26 years old. Advice on planning for the future

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frankandhonest

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Age: 26
Spouse’s/Partner's age: 26

Annual gross income from employment or profession: 73500
Annual gross income of spouse: 35000

Monthly take-home pay:
4200 + 2,400 = 6600

Type of employment:
me: private sector - full time, permanent
spouse: public sector - full time, temporary

In general are you:
I'm saving 2k per month, spouse saves 500 per month.

Rough estimate of value of home:
Renting @1000/month

Other borrowings:
None

Do you pay off your full credit card balance each month?
Yes

Savings and investments:
me:
31k prize bonds
9k in regular investment fund (I give 300 per month)
5k emergency fund in a savings account. I am going to keep building this to 10k and stop then due to the poor interest available in saving accounts.
spouse:
12k savings

Do you have a pension scheme?
Yes, I contribute 3% + employer gives 7%. Current value is 8k

Do you own any investment or other property?
No

Children
No children, and I don't anticipate this changing in the next 3/4 years.

Life + health insurance:
Paid by my employer

What specific question do you have or what issues are of concern to you?
While I enjoy my current job, it is not my passion. My dream job (unfortunately!) is in the public sector within the HSE. Salary scale starts at 30k and goes up to 42k + allowances. I plan to remain in my current position for another 3 years at most before changing.

I'm quite lucky to be earning such a good salary without have the high living costs of Dublin. I want to know how I can leverage this high income while I have it.

In the short/medium term, our goals are to buy a house. Our plan is to do this in the next 12-18 months (not in Dublin, so we're looking at 350k being the absolute maximum price). It doesn't have to be the "forever" home but we'd both like to get on the property ladder.

Long term, I would like a sense of financial security when I move to a lower paying job. I'm not sure if it makes sense to invest money in ETF's to achieve this and would appreciate any advice on this also.

Would it make sense to visit a financial advisor? Prices I see online are north of 1000 so I'm curious to hear of other people's experiences.
 
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If you're planning on buying a property in the next 12-18 months, I would suggest you simply keep your savings on deposit.
 
Sarenco said:
If you're planning on buying a property in the next 12-18 months, I would suggest you simply keep your savings on deposit.
Click to expand...

I had loosely earmarked the prize bonds for a deposit. I'll probably add another 5 - 7k to that value over the next year and that should cover the initial costs of buying.
 
frankandhonest said:
What specific question do you have or what issues are of concern to you?
While I enjoy my current job, it is not my passion. My dream job (unfortunately!) is in the public sector within the HSE. Salary scale starts at 30k and goes up to 42k + allowances. I plan to remain in my current position for another 3 years at most before changing.

I'm quite lucky to be earning such a good salary without have the high living costs of Dublin. I want to know how I can leverage this high income while I have it.

In the short/medium term, our goals are to buy a house. Our plan is to do this in the next 12-18 months (not in Dublin, so we're looking at 350k being the absolute maximum price). It doesn't have to be the "forever" home but we'd both like to get on the property ladder.

Long term, I would like a sense of financial security when I move to a lower paying job. I'm not sure if it makes sense to invest money in ETF's to achieve this and would appreciate any advice on this also.

Would it make sense to visit a financial advisor? Prices I see online are north of 1000 so I'm curious to hear of other people's experiences.
Click to expand...

you are going to take what will probably amount to a 60% paycut (once you get around to moving) to work within the HSE,

are you 100% sure that this is your dream job, how do you know?
 
To afford the kind of paycut you're talking about, you will need to reduce your mortgage as quickly as possible.
You should be aiming for a large cash deposit, not the minimum 10%.
Keep your money in cash equivalents that can be accessed quickly when you need it, and continue to pay down your mortgage as aggressively as possible once you buy.
 
frankandhonest said:
While I enjoy my current job, it is not my passion. My dream job (unfortunately!) is in the public sector within the HSE. Salary scale starts at 30k and goes up to 42k + allowances. I plan to remain in my current position for another 3 years at most before changing.
Click to expand...

Decent salary for a 26 year old, especially outside of Dublin. I would be thinking long & hard before dropping to 30k....
 
Blackrock1 said:
you are going to take what will probably amount to a 60% paycut (once you get around to moving) to work within the HSE,

are you 100% sure that this is your dream job, how do you know?
Click to expand...

It really is. I've volunteered in a similar area and have done some work experience with the ambulance service since. I know that 30k will be a shock to the system but I am trying to keep my spending low for this reason and to maximise the savings while I can save aggressively. I don't want to be rich, but I really don't want to spend my life struggling financially. That's the real thing that I'm trying to protect against.

Would it be foolish to buy an apartment for the next few years, given that we could, in theory, pay 2,500 (the amount we currently save each month) on the mortgage and then save the 1,000 that we pay on rent. The idea being that this would supplement our incomes if I do end up making this move.

Should I be putting more into my pension now, or just the bare minimum to get the employer matching? The position in the ambulance service is pensionable so I'm not sure if I'm wasting my time on the private pension.
 
Fair play to you. Not many people would take such a large drop in income for the dream goal, the attraction of a high salary would be too much. It is something to be admired.

Save as much as you can for your home so you have as small a mortgage as possible. You want to be in a position that when you do take that drop in income, your mortgage repayments are at a level you are comfortable with. If they are too high, it may put you off making the switch.


Steven
www.bluewaterfp.ie
 
Someone close to me did a very similar thing, dropped from a senior management job on at least what you are on if not more to paramedic salary which is shockingly low for new entrants considering the job, there was great salaries to be made there years ago whether rightly or wrongly with the extras. I know there are other allowances and a bit of overtime which bumps it up but the overtime is getting lower every year as they recruit more. That said they did it mid life as it was also a dream job so if you really want it you may as well go for it!

You will need to keep costs as low as possible as you can imagine so I'd agree that saving as much as you can to reduce amount of mortgage needed is the best plan for now.
 
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