Personal details
Age: 28
Spouse’s/Partner's age: N/a
Number and age of children: N/a
Income and expenditure
Annual gross income from employment or profession: €90,000 pa
Monthly take-home pay: €4,500
Type of employment: Private sector
In general are you: Saving c. €2,500 pm
Summary of Assets and Liabilities
PPR: One bed apartment worth €300k with €130k mortgage. Repayments are €500pm with 1 year remaining on 2.6% fixed term.
Investment properties: Rental property worth €200k with no mortgage
Cash: €90k
No stock
Other borrowings – car loans/personal loans etc
N/a
Buy to let properties
Value: €200k
Rental income per year: €16k
Other savings and investments:
Do you have a pension scheme? Yes 12% employer and 8% personal. I just started contributing last year so it's only worth €20k
What specific question do you have or what issues are of concern to you?
I appreciate I have considerable assets for my age but hoping to get some advice on how best to leverage them more effectively. I have always held excessive amounts of savings in the bank instead of investing. I'm relatively comfortable with investing in property but have no idea when it comes to the stock market. My immediate plan is to buy a larger home so that I can avail of the €14k rent-a-room scheme, and to then max my pension and start investing my savings into stocks.
My current plan:
I always thought it made sense to leverage the maximum mortgage possible when interest rates were relatively low but this doesn't seem as clear with current rates. I noticed recommendations on here often lean towards paying off mortgages in full but not sure if that applies at my age. Is there a risk of being mortgage free too young and not extending yourself enough? Is it better to invest in the stock market in the long term?
I know it ultimately comes down to the price of the home I'll be happy with, but I'm currently leaning towards maximising my deposit and borrowing the smallest mortgage possible. This would result in low monthly repayments while still maximising the €14k net rental income. Alternatively I could borrow the maximum, minimise my deposit and invest the remainder elsewhere. Or just max out both and hope the property increases in value with no CGT liability.
Any advice welcome!
Age: 28
Spouse’s/Partner's age: N/a
Number and age of children: N/a
Income and expenditure
Annual gross income from employment or profession: €90,000 pa
Monthly take-home pay: €4,500
Type of employment: Private sector
In general are you: Saving c. €2,500 pm
Summary of Assets and Liabilities
PPR: One bed apartment worth €300k with €130k mortgage. Repayments are €500pm with 1 year remaining on 2.6% fixed term.
Investment properties: Rental property worth €200k with no mortgage
Cash: €90k
No stock
Other borrowings – car loans/personal loans etc
N/a
Buy to let properties
Value: €200k
Rental income per year: €16k
Other savings and investments:
Do you have a pension scheme? Yes 12% employer and 8% personal. I just started contributing last year so it's only worth €20k
What specific question do you have or what issues are of concern to you?
I appreciate I have considerable assets for my age but hoping to get some advice on how best to leverage them more effectively. I have always held excessive amounts of savings in the bank instead of investing. I'm relatively comfortable with investing in property but have no idea when it comes to the stock market. My immediate plan is to buy a larger home so that I can avail of the €14k rent-a-room scheme, and to then max my pension and start investing my savings into stocks.
My current plan:
- Sell my 1-bed apartment and buy a 2/3-bed property where I can avail of the €14k rent-a-room scheme.
- Sell my rental property in 1-2 years unless tax treatment for landlords changes significantly. I would sell now if I could but this is jointly owned.
- Maximise my pension contributions to 15% this year and 20% next year.
- Start investing a large portion of my monthly savings in stocks - No idea where to start.
I always thought it made sense to leverage the maximum mortgage possible when interest rates were relatively low but this doesn't seem as clear with current rates. I noticed recommendations on here often lean towards paying off mortgages in full but not sure if that applies at my age. Is there a risk of being mortgage free too young and not extending yourself enough? Is it better to invest in the stock market in the long term?
I know it ultimately comes down to the price of the home I'll be happy with, but I'm currently leaning towards maximising my deposit and borrowing the smallest mortgage possible. This would result in low monthly repayments while still maximising the €14k net rental income. Alternatively I could borrow the maximum, minimise my deposit and invest the remainder elsewhere. Or just max out both and hope the property increases in value with no CGT liability.
Any advice welcome!