Moneymakeover Advice for this couple

[Brendan Burgess]

I have put this case study into Chat GPT and Claude before posting it on askaboutmoney.

Please respond so that I can compare the Askaboutmoney answers to AI.

Age 45
Wife’s age 43

Children aged 4 and 6

My income €80,000 a year – civil servant
Her income €50,000 a year – part-time in US multinational

Home value: €600,000
Mortgage : €450,000

Interest rate: Fixed at 3.5% ending in March 2027

20 year term so repayments are €2,609 per month

We have a €20,000 car loan with the Credit Union, but I don’t count that as borrowings as we have €20,000 in shares with them as well.

Pension fund - 15 years in Civil Service so a Defined Benefit Scheme – no AVCs

Her pension fund: Defined Contribution c. €20,000

Investments

Crypto worth €100,000
Educational Fund for children €50,000 in a Zurich fund

Wife has shares in her employer worth about €50,000 which will vest over the next three years

We also have €20,000 in a current account as a rainy day fund

Questions

We save about €1,000 per month. What is the best thing to do with it?

Our house is a bit small for a family of 4. It’s ok for the moment, but we will probably trade up in about 3 to 5 years.

I don’t want to touch the Zurich fund as that is for the kids’ education – is this the best way to save for their education?

We live quite frugally but don’t deny ourselves the basics.

 

[stantheman]

Use the credit union share balance to clear the car loan.
Sell the crypto and potentially the Zurich fund to bring down your mortgage to a <50% LTV to avail of a better rate. Kids are 12-13 years away from college - should they choose to go down that route you will have cleared the mortgage and can pay for it from income.
Pensions are light (at least hers - little details available on his) - use spare funds to top up pension contributions.
After pensions, use remaining funds to overpay on the mortgage - you already have an emergency fund (which should be moved out of the current account and into something generating interest) and will not get >3.5% return on your savings.
Both kids likely to be in school in the next 18-24 months - does she plan to return to work full time then?