Can't see the wood from the trees... please help

Discussion in 'Money makeover' started by rboyddd, 13 Mar 2019 at 2:58 PM.

  1. cremeegg

    cremeegg Frequent Poster

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    water WaterWater, surely ?
     
  2. SBarrett

    SBarrett Frequent Poster

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    Sorry, but that is nonsense. Paying €4.50 for a cake will not make any difference to whether you can live comfortably or not in retirement. It's the big purchases that make a difference. Does the OP want to live in a wealthy community with a big, expensive house. And have to fund the lifestyle of people in the area...€100k car, €30,000 for golf club joining fees.

    If he bought all his clothes in Brown Thomas, there would be questions to ask but not spending €4.50 on a slice of cake.


    Steven
    www.bluewaterfp.ie
     
  3. noproblem

    noproblem Frequent Poster

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    Ah come on, where's your sense of humour Steven? Anyway, "Let them eat bread" :)
     
  4. RedOnion

    RedOnion Frequent Poster

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    Make sure you're doing things for the right reasons.

    Property 1 is not making a loss. You have rental income of 15,600 Vs interest expense of 7,000. That's profitable in my book.
    Its cashflow negative because you are repaying capital.

    However, I would still get rid (obviously only when you crystallise the loss to offset).
    After expenses and taxes, you're probably netting a little over 3k on it. But paying 6,600 interest in your PPR. So it doesn't make sense to keep in those circumstances.

    I assume you've structured your income earning assets to fully utilise your wife's lower rate tax band?
     
  5. Sarenco

    Sarenco Frequent Poster

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    I suspect a pension that pays €40kpa from the age of 55 would have actuarial value well in excess of €1m, particularly where a surviving spouse continues to receive benefits.

    I would have thought that establishing the level of pension that you would receive if you retired early would be the first area to investigate.
     
  6. moneymakeover

    moneymakeover Frequent Poster

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    The investments look nicely balanced because they are paying for themselves

    You're getting 48k per annum income

    Outgoings 30k when second property paid off

    Not sure what your tax bill is

    You have 15k in interest to reduce your tax bill
    Add repairs, management fees, insurance. All helps to reduce tax liability

    Down the line, if you retire, your tax rate will reduce as your income drops
     
  7. SBarrett

    SBarrett Frequent Poster

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    Was it supposed to be a joke? If so, it went way over my head :(

    Got mixed up with all the other examples on here of people who walked out cafes because they didn't want to spend €4 on a scone.

    By way of disclosure, yesterday I went to my local coffee shop and got a big sausage roll (€4) and a coffee (€2.80) and finished off reading my book. I'd had a really busy morning and it was a great way to take a break. The €6.80 spent was totally worth it :)


    Steven
    www.bluewaterfp.ie
     
  8. RETIRED2017

    RETIRED2017 Frequent Poster

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    Keep eating big sausage rolls you need to be retiring before 55 to get any value from your pension pot,;);)
    If you make it to 55,
     
    galwaypat likes this.
  9. rboyddd

    rboyddd Registered User

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    Thanks RedOnion. I fully agree with your assessment. #1 is going once we are in a position to reduce the CGT bill. With respect to my wife's tax credits, I believe so, but will put this question to my accountant shortly.
     
  10. rboyddd

    rboyddd Registered User

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    I should have clarified, €1m should provide a €40Kpa pension from the age of 65+.... the immediate question is, the best way to fund getting to 65 without necessarily disposing of all/most of the performing assets.
     
  11. SBarrett

    SBarrett Frequent Poster

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    A rare treat. Everything in moderation ;)
     
    huskerdu likes this.
  12. huskerdu

    huskerdu Frequent Poster

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    I'm a firm believer in being careful with money and saving for a pension, but not at the expense of living life a little.

    Don't listen to him. What would life be without an occasional sausage roll.
     
  13. SBarrett

    SBarrett Frequent Poster

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    Worth every clogged artery. :D

    Usually eat fruit for a snack and work out 5 days a week, so I think I can afford a little treat here and there
     
  14. NoRegretsCoyote

    NoRegretsCoyote Frequent Poster

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    @rboyddd

    A few pieces of advice on the portfolio:
    • Get a better rate on your PPR. There are threads on this.
    • The tracker properties should be the last thing you sell, I would think not before the expiration of the trackers.
    • You seem a bit ambivalent about being a landlord, although it is an easy option for someone in semi-retirement. If you want to be a landlord you should look for yield. One- and two-bed apartments in unfashionable places carry nearly double the yield of your current portfolio.

    Can't answer your bigger questions. I think you have a relatively expensive lifestyle (more power to you - you can afford it!) but you would need to think hard about what you would cut back on with less income.
     
  15. noproblem

    noproblem Frequent Poster

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    The important thing is, you enjoyed it.
     
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