This is a bit of a red herring. While it obviously helps, it is more important for you to reach the maximum level of contribution that you can afford. At 50, you can contribute up to 30% of your income so you need to strive for this. The best way of doing this is for your wife to return to work as soon as is reasonable.Would this (company scheme with company matched contribution) be considered the fastest and most optimal way to build up your pension fund?
With the level of debt that you have (mortgage & home loan) and 3rd level on the horizon for the 3 older kids, you are likely to need additional loans when all 3 could be in university together. With a single income, you are at serious risk of missing payments and affecting your credit report which could make it very difficult to access loans in the futureCash/savings: 0
You are massively under-insured. If anything happened to you, the €400k covers your debts. Your spouse would have no ability to maintain your current lifestyle even if they returned to work. The home would have to be sold to free up money. Ideally this wouldn't have to be done at least until the older 3 are through university and independentLife insurance:
Yes, cover for 400k+
IMO, this is a failure of the CB rules. You might have been within the limits but in your mid-40's with a single income, 5 dependents and no pensions, the bank should never have allowed you to borrow that amount as it is now putting you under pressureOur mortgage is 3.15 times my gross salary, so it's bit under the new Central Bank lending loan-to-income limit.
This is not a choice but a necessity. As your kids approach 15/16, you should talk to them as adults and explain some of the financial choices you are making. You can't afford to pay their rent elsewhere so they have to choose a university closer to home. Encouraging them to get weekend and holiday work will also take the pressure off youthere are lots of 3rd level colleges to choose from when the kids reach that age, plus they could live at home if the end up going to college in the area
This is encouraging that you have good control of your budget. You should be able to see how important it will be for your spouse to return to work and the impact that an additional €20/30/40k will have on your ability to fund pension and clear debt.We manage our family budget in a large spreadsheet, every penny is accounted for from the moment I get paid each month. We change gas/electricity/broadband providers every year on the exact day the contract is up to keep costs are a bare minimum. Shop at discount supermarkets such as Lidl to keep costs down. Two cars in the household, both over 10 years old. Nothing fancy, no frills, no crazy expensive purchases, food is always on the table and bills/loans always paid, one "budget" holiday once a year... but yes, it is tight, especially with the cost of living these days.
I fully agree. These rules are the same for a 25YO as a 45YO.IMO, this is a failure of the CB rules. You might have been within the limits but in your mid-40's with a single income, 5 dependents and no pensions, the bank should never have allowed you to borrow that amount as it is now putting you under pressure
The OP should not be taking on additional loans they can't afford.With the level of debt that you have (mortgage & home loan) and 3rd level on the horizon for the 3 older kids, you are likely to need additional loans when all 3 could be in university together.
IMO, this is a failure of the CB rules. You might have been within the limits but in your mid-40's with a single income, 5 dependents and no pensions, the bank should never have allowed you to borrow that amount as it is now putting you under pressure
This model is the most underused 'perk' in the country in a lot of cases. They should be encouraged to wait until they're over 23 before they decide to apply for a course. They can also be working and/or use the back to education grants. This gives them a way better chance or getting the course they want and making an informed choice as they are not competing with a rediculous best in class rather than most suited for model. It was only when I worked at the crappy, dirty, low paying jobs that I appreciated the 5 years of scrimping and studying that others did to be as smug as they were.How about the adults (they will be adults) get jobs and pay for their own education?
Personal details
Age: 47
Spouse’s/Partner's age: 49
Number and age of children: Four children: 12, 9, 8 and 4
Income and expenditure
Annual gross income from employment or profession: €106k
Annual gross income of spouse: €0
Monthly take-home pay: €6,000
Type of employment: Private sector - permanent full-time
In general are you:
(a) spending more than you earn, or
(b) saving?
- Barely breaking even every month, very difficult to save for pension or childrens' education
Summary of Assets and Liabilities
Family home worth €900k with a €334k mortgage remaining
Cash/savings: 0
Defined Contribution pension fund: 0
Company shares: 0
Family home mortgage information
Lender: Avant - 20 Year fixed term
Interest rate: 2.50%
If fixed, what is the term remaining of the fixed rate? 20 years.
Monthly repayments: €1769
Other borrowings
Home Improvement Loan (40k)
Lender: Avant - 7.5 years remaining, €30k balance remaining
Interest rate: 5.9%
Monthly repayments: €500
Additional monthly payments: €300 (attempting to clear entire loan early - in ~3 years)
Do you pay off your full credit card balance each month?
YES
Other savings and investments:
- No investments
- Saving €50 a month for each child, deposited directly into their BoI Child Saver accounts, 0.25% interest rate (for future education)
Do you have a pension scheme?
No
Do you own any investment or other property?
No
Other information which might be relevant
Life insurance:
Yes, cover for 400k+
What specific question do you have or what issues are of concern to you?
We have roughly 20 years until retirement age, and neither of us have a private pension. My employer has just introduced a company scheme, due to start in a few months, where they match up to 3% of an employee contribution - so I will be availing of this, and would hope to contribute even more. My wife is currently unemployed, due to looking after the children, although it is likely she will need to return to work so that we can maximise pension contributions and savings for our children's future education. We have a lot of catching up to do, and it appears we'll need to start lumping thousands into savings aggressively as soon as possible.
Pension Question
With 20 years until retirement age, we need to put as much into private pensions as possible. I'm assuming that the best way to get the most 'mileage' for our money is to be with a company scheme where the employer also matches a certain percentage, thereby building up the fund much faster than if it were just a private pension? Would this (company scheme with company matched contribution) be considered the fastest and most optimal way to build up your pension fund?
Education Fund Question
We are not saving enough for our children's education at the moment. The Zurich Insurance "cost of college calculator" estimates we should be putting at least 1k monthly into an investment fund. We're currently only saving 200 euro into child saver accounts, and the money isn't growing. We need to increase payments and move the money somewhere where it will grow. Would a fund with Zurich/Irish Life/other be the best way to go to maximise the return on the college savings?
Thanks for reading.
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