My ex -husband was betting on our $ 900,000 savings. Do I use 401 (K) to buy a home?

I’m very pleased to read the money. I need advice and I hope you can provide some enlightenment.

A short story: My second husband had an addiction to gambling and unknown to me, cleaning our savings and a joint investment account for six years for a total of nearly $ 900,000. He managed these accounts and assured me that we were on the territory of $ 1 million. However, he never showed me documents to prove it, and I did not ask because I loved him and trusted him completely; He also processes taxes for tax filing.

I have never seen the losses from our tax returns until a forensic accountant revealed it during the divorce. I learned a difficult lesson – a very, very difficult lesson – to divert my financial responsibility. I am 65 and do six digits in a new job in the last four years. I have about $ 80,000 in my 401 (K) and $ 10,000 savings. I had an inheritance that I paid all my debt. I am a tenant and do not own real estate after my divorce.

I am a dual citizen of the United States and the UK and I am about to move to the UK for a new position in the world company I work for. I hope to work for another five years and then retire. Unfortunately, I will no longer be able to contribute to social security, but I will contribute to the UK’s pension system, which will not make me benefit, as one has to work for 10 years to get that benefit. But the cost of life will be more cheap there.

Don’t miss out: I have my ex -husband’s social security benefits. Should I retire at 65 and travel?

I will stay with family members a few months after my relocation. I hope to find something affordable that I can invest 50% of my 80,000 British pound income, as well as my 20% bonuses in the company’s pension plan for the next five years (they make an 11% contribution). Now everything is about saving every penny, dollar and penny. (Don’t worry about him, he is already marrying a much older woman who is rich and who is also wise enough not to put his name on any of his assets.)

Regarding my social security, I planned to contribute to it until the age of 70 so I could get the maximum amount. However, I am a little confused, I was under the impression that I had to constantly contribute to the end of the age of 70 to get the maximum amount, but others said that even if they stop contributing now with this move in the UK, I would still receive the same maximum amount in the dollar, just waiting for up to 70?

Should I take out 401 (k) and use it as an advance payment for a home in the UK? I have serious concerns about financial stability with advancing age and it is not in my plans to look for another marriage. I was hoping to buy a small piece of land and put a assembly on hebhome on it and pay it until I retire, so at least I have the safety of my own home and not be subject to growing rents with advancing age. I will probably live outside the social security and whatever I can accumulate.

Any financial wisdom you can pass on is highly appreciated.

Once bitten twice shy

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I congratulate you on the courage it took to get to this point.

Every time I encounter difficult or unwanted development, I say to myself, “Quentin, this is another human experience that you must have.” You had to travel through such an unexpected deviation in your life. Anyone who has experienced financial loss, either through bad investment, or from a third -party misdeed, will know the type of endurance that it will take to get you so far. You are now on the abyss of your new life and the United Kingdom is a great place to start.

Financially, you probably go ahead if you use those $ 80,000 to buy a home when you move to the United Kingdom if you bought a $ 300,000 home (I stick to dollars to simplify it), using your $ 80,000, at 6.7% interest rate, you will have a monthly payment of $ 1420. You will be left with $ 195,000 for the mortgage in 10 years and with a 3% annual increase in value, ending with a $ 403,000 house. It’s $ 208,000 in equity.

If, on the other hand, you have left those $ 80,000 in your 401 (K) for the next 10 years by accepting a moderate 7% annual return (again to do it simple), you may have/maybe you will have $ 157,372 in your 401 (K). So you’ll go forward with $ 50,600, but you’ll still hire. So mathematics/logic suggests that it is better to buy. Libra would be directed in favor of investing 401 (k) if you had more money invested but would not have those 10 years to live in your own home.

Good news: You will still reap the benefits of delayed retirement loans if you wait for your full retirement age (67) to collect social security. You delay each year, your benefit increases by 8%until you are 70 years old. Your social security benefits will be determined by your 35 years with the highest profit. You will be able to gather these benefits when you reach the appropriate FRA or then if you decide to wait.

Don’t miss out: We live in “End Times” when you can’t retire at $ 1 million

Your joint citizenship of the United Kingdom/US will serve you well after turning luck. You will need an income of about 44,000 British pounds a year for convenient retirement in the UK and £ 32,000 a year for moderate retirement, all depending on where you live, according to Pensions UK, a non -profit organization that aims to help people plan their retirement. In the US, you will need more than $ 1.25 million, based on the latest estimates from the real global investor, a website for investing.

The US has a tax contract with the US, which means you do not need to pay income tax twice on your income or investment while living in the UK as a double citizen of the UK/US. However, if you are no longer employed by an American company, you are usually not allowed to contribute to 401 (K). In addition to the United Kingdom, Germany and Canada, among others, they have contracts that allow credit for paid taxes in the United States.

Some warning notes: The US dollar has its oldest year, as President Richard Nixon was in office, and some analysts believe it would become more glorious in the second half of the year. This said the pound in the UK also has a difficult time for fears about the British economy. The loud dollar means you won’t get that much bang for your dollar. Currently, expect to receive about 74 pence for one US dollar. (You would have achieved a better deal a few years ago.)

The truth is a happy and peaceful retirement will depend on whether you have enough money to cover your expenses, your lifestyle and quality of life. Although some people require millions of dollars retirement to take cruises and live big, the latter is not governed by money. It is managed by your own tastes. Would you prefer a weekly card game with friends, or would you rather be a member of an exclusive rural club?

You have five years until retirement and more to build a community.

Related: I have a specialty economy: I am at $ 70, earn $ 250,000 a year and I have $ 3.7 million in investments. Is it time to retire?

Previous columns from Quentin Fottrell:

“I felt invisible, disrespectful and broken by the heart”: my firstborn son wants nothing to do with me. Did I cut it?

“I’m considering giving up my citizenship in the US”: I move to the UK how to invest $ 30,000 money?

“The sales agent has long been dead”: my $ 250,000 life policy costs $ 2,000 a month. I’m 80. Is it time to dig it?

S