FinanceConvo
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Personal details
Your age: 39
Your spouse's age: 37
Number and age of children: 2yo & 4yo
Income and expenditure
Annual gross income from employment or profession: 140,000 + 20% bonus, depending on company performance
Annual gross income of spouse/partner: 85,000 + 15% bonus, depending on company performance
Monthly take-home pay: 10k after all deduction (pension, health)
Type of employment: PAYE
Employer type: both private
In general are you:
Saving - average 2k p/m. Should be more but we have high fixed costs (€4-€5k p/m) with childcare & mortgage. That along with working long hours means we are not as frugal as we should be with groceries and other expenses- meal planning etc is hard! Will work on improving this but need to be realistic.
Summary of Assets and Liabilities
Family home value: 730,000
Mortgage on family home: 480,000
Net equity: 250,000
Cash: 73,000 across blended ~2% instant access accounts
Defined Contribution pension fund: 370,000 - equities
Company shares : 7,000 locked for 3 years
Total net assets: 700,000
Family home mortgage information
Fixed 3.5% for next 2 years
Remaining term: 29 years
Monthly repayment: 2,200
Other borrowings – car loans/personal loans etc
Do you pay off your full credit card balance each month? Yes
No other loans
Pension information
Value of pension fund: 370,000 - equities
What specific question do you have or what issues are of concern to you?
We are currently both maxing our pension contributions to tax free cap (20% limit). Our employers only match to 6%.
We cannot over-pay our mortage until fixed term ends.
Current plan is keep maxing pension and save 2k p/m to have 120k or so cash by time fixed term ends. Pay off 100k from mortgage and retain 20k for emergency fund and rebuild savings. This would reduce mortgage payment to 1,700 at current rate. Risks to this plan are job losses or if we need to replace either of our >10 year old cars. Opportunities are upside from bonuses which I do not consider for financial forecasting - there has been very bad years in the past!
Seeking advice on if this is a sound strategy or if we are missing anything. We are in well paying jobs and are both experienced professionals. However, we are both in private industry and getting the same salary again quickly in a downturn will not be easy. We are conservative and want to pay down our mortgage but do not want to lose out on pension benefits. Long hours take their toil and ideally we would seek to reduce income when our fixed costs reduce.
Specific questions:
Your age: 39
Your spouse's age: 37
Number and age of children: 2yo & 4yo
Income and expenditure
Annual gross income from employment or profession: 140,000 + 20% bonus, depending on company performance
Annual gross income of spouse/partner: 85,000 + 15% bonus, depending on company performance
Monthly take-home pay: 10k after all deduction (pension, health)
Type of employment: PAYE
Employer type: both private
In general are you:
Saving - average 2k p/m. Should be more but we have high fixed costs (€4-€5k p/m) with childcare & mortgage. That along with working long hours means we are not as frugal as we should be with groceries and other expenses- meal planning etc is hard! Will work on improving this but need to be realistic.
Summary of Assets and Liabilities
Family home value: 730,000
Mortgage on family home: 480,000
Net equity: 250,000
Cash: 73,000 across blended ~2% instant access accounts
Defined Contribution pension fund: 370,000 - equities
Company shares : 7,000 locked for 3 years
Total net assets: 700,000
Family home mortgage information
Fixed 3.5% for next 2 years
Remaining term: 29 years
Monthly repayment: 2,200
Other borrowings – car loans/personal loans etc
Do you pay off your full credit card balance each month? Yes
No other loans
Pension information
Value of pension fund: 370,000 - equities
What specific question do you have or what issues are of concern to you?
We are currently both maxing our pension contributions to tax free cap (20% limit). Our employers only match to 6%.
We cannot over-pay our mortage until fixed term ends.
Current plan is keep maxing pension and save 2k p/m to have 120k or so cash by time fixed term ends. Pay off 100k from mortgage and retain 20k for emergency fund and rebuild savings. This would reduce mortgage payment to 1,700 at current rate. Risks to this plan are job losses or if we need to replace either of our >10 year old cars. Opportunities are upside from bonuses which I do not consider for financial forecasting - there has been very bad years in the past!
Seeking advice on if this is a sound strategy or if we are missing anything. We are in well paying jobs and are both experienced professionals. However, we are both in private industry and getting the same salary again quickly in a downturn will not be easy. We are conservative and want to pay down our mortgage but do not want to lose out on pension benefits. Long hours take their toil and ideally we would seek to reduce income when our fixed costs reduce.
Specific questions:
- Is the plan above correct or should we be doing something different like aiming to pay off more of the mortage and reduce pension contributions?
- Does our financial situation seem healthy or are there any concerns?