Personal details
Age: Early 30s
Spouse’s/Partner's age: Late 20s
Number and age of children: 0 (and agreed plan is to have none)
Income and expenditure
Annual gross income from employment or profession: €68,500
Annual gross income of spouse: €47,500
Monthly take-home pay: €6,500
Type of employment: Civil Servant x2
In general, we are saving.
Summary of Assets and Liabilities
Family home worth €440k with a €300k mortgage
Cash €22k
Family home mortgage information
Ulster Bank (soon to transfer to PTSB)
2.2% (BER is a D1 or D2)
Fixed until 2027
We are able to overpay by 10% of Jan 1st balance in each calendar year without penalty, though any more may attract a break fee. It is unclear how PTSB will deal with the issue of overpayment.
Other borrowings – car loans/personal loans etc
A single credit card in my name with €0 drawn and a €5,000 limit in case of emergencies.
Buy to let properties
None.
Other savings and investments
We both have defined benefit pensions under the Single Public Sector Pension Scheme, but we have no AVC PRSAs.
Other information which might be relevant
Mortgage protection insurance.
Spousal death benefit under the Single Public Sector Pension Scheme x2.
My spouse has life assurance and income protection, arranged through work. No idea on the details.
We have no private medical insurance.
What specific question do you have or what issues are of concern to you?
We are generating too much excess cash and have to do something with it.
We are looking for feedback on the following plan, which is set out in order of our current preference and sense of time priority. We're particularly interested in if you think we are missing anything or if you disagree with our rank ordering.
1. Take out income protection for myself, re-evaluate the terms of my spouse's income protection, and re-evaluate our life contracts. Our main asset is our ability to generate strong income for the next 30+ years, so illness or the death of one partner is a major downside risk.
2. Set up self-directed AVC PRSAs for each of us and make full use of Income Tax relief. We would track a cheap global equity index for around ten years, then re-weight by adding bonds and assess values relative to Revenue Commissioner occupational pension benefit limits as they relate to the Single Public Sector Pension Scheme. Re-weight further into bonds routinely as we age.
3. Overpay our mortgage fairly aggressively, though with an eye also on financing some home renovation in the next 2-5 years (possibly going as far as a grant-aided deep retrofit). If house prices fall 20%, we would like to still have a respectable (70-80%) LTV as we we will likely have to switch away from PTSB at some point.
4. Take out medical insurance, certainly before we each hit 35.
5. Spend more money on nice things.
6. Consider moving to a more expensive home if it would improve our lifestyle and, less importantly, to allow us to potentially release more equity later in life should we ever need it and to give us more exposure to CGT-free potential price growth. If high value Irish properties fall in price, then lower value Irish properties might do so also providing a partial hedge. We would sell our existing home if there is no tax efficient means of taking in rental income and/or the rent control environment is unchanged.
7. Consider investing further in international stocks and bonds, outside of a pension structure.
8. Consider getting Income Tax relief on through the Employment Incentive and Investment Scheme, accepting the relatively high risk exposure to small Irish companies.
Age: Early 30s
Spouse’s/Partner's age: Late 20s
Number and age of children: 0 (and agreed plan is to have none)
Income and expenditure
Annual gross income from employment or profession: €68,500
Annual gross income of spouse: €47,500
Monthly take-home pay: €6,500
Type of employment: Civil Servant x2
In general, we are saving.
Summary of Assets and Liabilities
Family home worth €440k with a €300k mortgage
Cash €22k
Family home mortgage information
Ulster Bank (soon to transfer to PTSB)
2.2% (BER is a D1 or D2)
Fixed until 2027
We are able to overpay by 10% of Jan 1st balance in each calendar year without penalty, though any more may attract a break fee. It is unclear how PTSB will deal with the issue of overpayment.
Other borrowings – car loans/personal loans etc
A single credit card in my name with €0 drawn and a €5,000 limit in case of emergencies.
Buy to let properties
None.
Other savings and investments
We both have defined benefit pensions under the Single Public Sector Pension Scheme, but we have no AVC PRSAs.
Other information which might be relevant
Mortgage protection insurance.
Spousal death benefit under the Single Public Sector Pension Scheme x2.
My spouse has life assurance and income protection, arranged through work. No idea on the details.
We have no private medical insurance.
What specific question do you have or what issues are of concern to you?
We are generating too much excess cash and have to do something with it.
We are looking for feedback on the following plan, which is set out in order of our current preference and sense of time priority. We're particularly interested in if you think we are missing anything or if you disagree with our rank ordering.
1. Take out income protection for myself, re-evaluate the terms of my spouse's income protection, and re-evaluate our life contracts. Our main asset is our ability to generate strong income for the next 30+ years, so illness or the death of one partner is a major downside risk.
2. Set up self-directed AVC PRSAs for each of us and make full use of Income Tax relief. We would track a cheap global equity index for around ten years, then re-weight by adding bonds and assess values relative to Revenue Commissioner occupational pension benefit limits as they relate to the Single Public Sector Pension Scheme. Re-weight further into bonds routinely as we age.
3. Overpay our mortgage fairly aggressively, though with an eye also on financing some home renovation in the next 2-5 years (possibly going as far as a grant-aided deep retrofit). If house prices fall 20%, we would like to still have a respectable (70-80%) LTV as we we will likely have to switch away from PTSB at some point.
4. Take out medical insurance, certainly before we each hit 35.
5. Spend more money on nice things.
6. Consider moving to a more expensive home if it would improve our lifestyle and, less importantly, to allow us to potentially release more equity later in life should we ever need it and to give us more exposure to CGT-free potential price growth. If high value Irish properties fall in price, then lower value Irish properties might do so also providing a partial hedge. We would sell our existing home if there is no tax efficient means of taking in rental income and/or the rent control environment is unchanged.
7. Consider investing further in international stocks and bonds, outside of a pension structure.
8. Consider getting Income Tax relief on through the Employment Incentive and Investment Scheme, accepting the relatively high risk exposure to small Irish companies.
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