Your family financial plan: 2026–2035
My overall view is that you are in a strong financial position. You have substantial property equity, two good incomes, no consumer debt, meaningful pension assets, and the ability to save regularly. The next stage is about turning that wealth into financial independence, a secure retirement, and more freedom to enjoy life as a family.
I would build your plan around five priorities:
- Decide what to do with the rental property in summer 2027.
- Make the most of your public-service pension and AVC opportunities.
- Decide whether to clear your family mortgage or retain a small balance.
- Build a diversified pool of accessible investments outside property and pensions.
- Set aside money for your children's education and, just as importantly, enjoy some of your wealth before retirement.
I would not rush to invest the entire proceeds of the rental sale. Your biggest opportunity is to use the money to simplify your finances while improving your long-term retirement options.
1. Where you stand today
Estimated household net worth
€1,237,000
Before any tax on a property sale, selling costs, or other unlisted assets and liabilities.
Family home equity
€432,000
Rental property equity
€495,000
Your pension / AVC
€64,000
Husband's pension figures
€446,131
As reported; DB figure needs clarification
Plus your Zurich investment fund and children's savings, whose values weren't supplied. Pension figures are included as reported, not independently valued.
Your combined monthly take-home pay is €7,326, and you report saving approximately €1,000 per month.
Monthly take-home income
€7,326
Current monthly saving
€1,000
Approximate savings rate
13.6%
Your household balance sheet is strong, but a lot of your wealth is tied up in property and pensions. The rental sale could help rebalance that towards a debt-free home, pension security and liquid investments you can access before retirement.
One important distinction: your husband's defined-benefit pension should not automatically be treated like an investment account. If the €240,959 figure is a transfer value, actuarial value or projected benefit value, its meaning for retirement planning is very different from €240,959 sitting in a personal pension fund.
2. Should you sell the rental property?
Based on what you've described, I would lean towards selling in summer 2027, provided you are comfortable with the after-tax proceeds and the property isn't likely to have an unusually strong financial advantage over the alternatives.
Your rental property is mortgage-free and valuable, but its return after tax appears modest relative to the capital tied up in it.
Rental property — estimated annual economics
Gross annual rent (€2,150 × 12)
€25,800
Estimated net rental income
€13,200
Net yield on €495,000 value
2.7%
The 2.7% figure is based on your estimate of €1,100 per month after tax and expenses, divided by the property's current value. It excludes any future capital appreciation.
You also say that the rental income covers the family mortgage payment of €1,068 per month. That is useful for household cash flow, but it doesn't mean the rental property is generating a high return: you have almost €500,000 tied up in it.
What selling would achieve
- Remove landlord responsibilities and exposure to tenancy rules.
- Reduce the concentration of your wealth in Irish residential property.
- Give you the option of eliminating your family mortgage.
- Free up cash to fund retirement and invest more broadly.
- Potentially make your finances much simpler before your children reach university age.
The main argument for retaining the property is the potential for long-term capital appreciation and future rent increases. However, I would not rely on property prices continuing to rise to make the numbers work.
First, establish your actual net sale proceeds
You estimate receiving €380,000. Before relying on that figure, ask your accountant to calculate the expected proceeds after capital gains tax (CGT), legal and selling costs, and any other relevant adjustments.
CGT is charged on the taxable gain, not the full sale price. Acquisition costs, eligible improvements, selling expenses, available reliefs and the ownership split can affect the calculation.
Revenue
+1
For planning purposes, I will use your €380,000 estimate as the net cash available after the sale, but treat it as provisional until the tax calculation is confirmed.
3. Should you pay off the €218,000 family mortgage?
My preference would be to pay it off when the fixed rate expires in February 2027, or shortly after the sale completes, rather than retain a mortgage just to keep money invested.
Your mortgage rate of 2.25% is attractive, but it is about to expire. Your next rate may be higher, and the alternative investment return would need to compensate you for tax, investment risk and volatility.
Paying off a mortgage is effectively a guaranteed saving on the interest you would otherwise pay. Keeping the mortgage and investing instead can work out better financially, but the outcome is uncertain.
Here is how your choices compare, assuming the sale produces €380,000 net.
Option A — Clear the mortgage
€162,000 remaining
€380,000 proceeds less €218,000 mortgage.
No mortgage payment, lower financial risk and a simpler household budget. You would free up €1,068 a month for saving, investing and family spending.
My preferred option
Option B — Retain the mortgage
€380,000 retained
You keep more cash available for investing, but still owe €218,000 and must pay interest at the new mortgage rate. This may be worthwhile if liquidity is a priority and your investments are expected to outperform the mortgage cost after tax and fees.
Option C — Partial repayment
€50k–€100k mortgage
A compromise if you particularly value liquidity. You reduce your interest bill while retaining some of the proceeds for accessible investments and planned spending.
Why I favour clearing it
You have approximately 15 years left on the mortgage. Clearing it would remove a significant fixed cost before your planned retirement at 56, although the precise value depends on your retirement date and mortgage terms.
It would also create a useful behavioural benefit: you could redirect the former €1,068 payment towards long-term investments automatically every month.
The one qualification is that your current mortgage rate is fixed until February 2027. Check the redemption terms with PTSB and avoid an unnecessary early repayment charge. You should also compare the new mortgage rate available after the fixed period expires.
4. Maximise your AVCs — but do it strategically
This is probably your biggest tax-planning opportunity.
At age 47, the normal Irish age-related limit for tax-relieved pension contributions is 25% of relevant earnings, subject to the €115,000 earnings cap and the rules governing your particular pension scheme. At age 50, the age-related limit normally increases to 30%.
Citizens Information API
+1
Based on your gross salary of €84,800:
| Calculation | Annual amount |
|---|
| Gross employment income | €84,800 |
| 25% age-related limit | €21,200 |
| Current contribution at 3% | €2,544 |
| Indicative remaining headroom | €18,656 |
This is an initial illustration, not confirmation of your actual allowance. Your existing public-service pension contributions and the precise rules of your scheme need to be checked before deciding the amount of additional AVCs you can make.
Why AVCs could be particularly attractive for you
If your contributions qualify for income tax relief at 40%, every €100 of eligible AVC contribution costs you only €60 after income tax relief, assuming you have sufficient income taxed at that rate. The contribution itself is not necessarily free of all taxes or charges, and relief is subject to the scheme's rules.
CERS
+1
Your goal of retiring at 56 makes the question especially important. You have around nine years to build the resources needed to bridge the period before other pension benefits become payable.
I would take these steps:
- Obtain a written pension projection. Ask your public-service pension administrator to show your benefits if you retire at 56, 60 and your normal pension age, including any early-retirement reductions.
- Establish your actual AVC allowance. Ask payroll or your pension administrator to calculate the remaining tax-relievable contribution after your existing pension contributions.
- Increase contributions gradually. Rather than jumping straight to the maximum, test a higher monthly contribution and see how much your household budget can comfortably absorb.
- Use some sale proceeds for a planned AVC strategy. A lump sum may be appropriate, but the amount should be determined by your annual tax-relief limit, retirement timetable and access requirements.
The important caution is that pension tax relief does not make every pension contribution the right decision. Money paid into an AVC is intended for retirement, and access and benefit options depend on the scheme. You need to keep sufficient accessible savings for the years before you can use those funds.
How much should you contribute?
I would not automatically put the maximum into your AVC every year without first modelling your retirement income.
A sensible starting point is to test the following contribution levels, assuming you qualify for 40% income tax relief on the contributions.
| Annual AVC | Approx. monthly gross contribution | Cost after 40% income tax relief |
|---|
| €6,000 | €500 | €300/month |
| €12,000 | €1,000 | €600/month |
| €18,000 | €1,500 | €900/month |
These are illustrations of income tax relief only, not a statement of your exact remaining contribution allowance.
Since you currently save approximately €1,000 per month, I would start by modelling an AVC contribution of €6,000–€12,000 per year. You could potentially increase this with future salary growth or a carefully planned lump sum, once your retirement projection and tax-relievable headroom are clear.
5. Your most important retirement question: can you really retire at 56?
You are 47, so retirement at 56 is roughly nine years away. Your husband is 45, so the two of you may have different retirement dates and income needs.
I would make this your main financial planning project over the next six months.
Your own public-service pension could be the foundation of your retirement income, but eligibility to retire and the age at which you can draw your benefits without reduction depend on your scheme and recruitment history. Some public-service arrangements permit early payment with actuarial reductions; others have different minimum ages.
publicservicepensions.gov.ie
+1
Ask for three projections:
- Age 56: your preferred early-retirement scenario.
- Age 60: a later alternative if early retirement reduces your benefits too much.
- Normal pension age: the benchmark against which to compare the other two.
For each scenario, request the expected annual pension, lump sum, AVC value and any reduction for early payment.
Your husband's pension should also be projected separately, particularly the defined-benefit element.
Build a bridge between retirement and pension income
I would divide your future finances into three stages.
47–56
Stage 1: Accumulation
Increase tax-efficient pension saving, sell the rental if appropriate, clear the mortgage and build accessible investments.
56–66
Stage 2: Early retirement bridge
Fund any gap between stopping work and receiving your full pension benefits using eligible pension benefits, AVCs, cash and accessible investments, depending on scheme rules.
66+
Stage 3: Long-term retirement
Combine occupational pensions, any applicable State Pension entitlement and investment income, with a plan for inflation, healthcare and later-life expenses.
The ages above are planning milestones rather than assumptions about when each pension will become payable.
My key advice: don't maximise a pension contribution simply because the tax relief looks attractive. Maximise the contribution that helps you retire when you want, with enough money accessible to live comfortably until all your pension income streams are available.
6. What I would do with the €162,000 left after paying off the mortgage
Assuming €380,000 is genuinely available after all sale-related tax and costs, clearing the €218,000 mortgage leaves approximately €162,000.
I would allocate this money deliberately rather than investing it all at once.
Here is an illustrative starting allocation, not a requirement to follow every amount.
1. Emergency and accessible savings
€30,000
Keep this in an accessible deposit account for unexpected expenses, home repairs and income disruption. Adjust for your actual household expenditure and job security.
2. Long-term investments outside pensions
€75,000
Build a diversified portfolio for flexibility and future wealth. Choose the mix of cash, bonds and equities according to your risk tolerance and when you may need the money.
3. Family experiences and goals
€15,000
Set aside a deliberate amount for a family holiday, home improvements or experiences you value. You have spent years building wealth; enjoying a measured portion of it is reasonable.
4. Pension contributions and retirement reserve
€42,000
Retain this as a reserve for a planned series of tax-efficient AVC contributions and additional retirement needs, subject to annual contribution limits and access rules.
Total allocated
€162,000
The €42,000 reserve is not a recommendation to pay €42,000 into an AVC immediately. At your current salary, the ordinary age-related limit is unlikely to support that entire amount as a single year's tax-relieved contribution. The money can be held safely and used according to your annual allowance and retirement timetable.
Likewise, the €75,000 investment allocation should be adjusted after reviewing your existing Zurich investment fund. You may already have significant investment exposure, or your fund may have fees or tax characteristics that make a different approach more suitable.
Why I would keep money outside your pension
Pension saving and accessible investing serve different purposes.
- AVCs can provide valuable tax relief and support retirement income.
- Accessible investments can fund the years before you can draw certain pension benefits, home projects and unexpected costs.
- Cash gives you stability and prevents you from having to sell investments during a market downturn.
You already have substantial property exposure. I would therefore favour broad diversification rather than replacing one Irish property with another or concentrating the sale proceeds in a small number of shares.
For Irish residents, investment taxation can differ substantially between deposits, direct shares, funds and other investment products. Check the tax treatment and fees before selecting the investment vehicle.
7. What about your children and other family goals?
Your children are 9 and 13. You expect to have €10,000 saved for each by the time they might go to college, which is a good start.
I would review that target in light of the likely cost of education, accommodation and living expenses when they reach college age.
For your 13-year-old, you have approximately five years until age 18; for your 9-year-old, approximately nine years. This difference matters when deciding how much investment risk to take.
My approach would be:
- Keep money needed in the next few years in cash or low-risk savings.
- Consider a diversified investment approach for the younger child's longer time horizon, if you can tolerate fluctuations and the tax treatment is suitable.
- Review the savings target annually rather than automatically committing a large amount of the property proceeds.
- Avoid sacrificing your own retirement security to fund every possible future expense for your children.
You can help your children substantially while still preserving your ability to retire comfortably.
8. A few other opportunities worth reviewing
Your Zurich investment fund
Review the fund's current value, charges, asset allocation, exit costs and tax treatment. If the property sale makes you more financially flexible, you may not need to take excessive risk with your existing investments.
Don't automatically surrender or sell the fund without checking potential tax consequences and charges.
Your husband's pension
Ask his pension provider for a statement showing:
- The current value and projected benefits of his defined-contribution pension.
- The precise meaning of the €240,959 defined-benefit figure.
- His projected retirement income at different ages.
- Any employer matching contributions he should be maximising.
Employer pension contributions can be a valuable part of his remuneration, so confirm that he is receiving the full benefit available under his scheme.
Review the rental tax relief before selling
Ireland's Residential Premises Rental Income Relief is available subject to qualifying conditions for 2026 and 2027. However, disposal rules can trigger clawback of relief claimed in earlier years. Ask your accountant whether any relief you have claimed, or intend to claim, would need to be repaid if you sell in summer 2027.
Revenue
+1
Also ask your accountant to review the rental property's tax position, ownership shares and sale date before you commit to a transaction.
9. Your practical action plan
Now — October to December 2026
- Obtain pension projections for both of you.
- Calculate your actual AVC allowance and marginal tax relief.
- Ask an accountant to estimate CGT and the net proceeds from a 2027 sale.
- Review the Zurich fund and your existing emergency savings.
Before February 2027
- Compare PTSB's new mortgage rate with alternatives.
- Check any early-repayment conditions.
- Decide whether you want the mortgage cleared as soon as the sale proceeds become available.
Spring to summer 2027
- Confirm the property sale price, selling costs and final tax estimate.
- Keep the amount needed for tax separate from money available to invest.
- If you sell, clear the mortgage if the final figures support that decision.
- Set up your accessible savings, investment and retirement reserves.
From late 2027 onwards
- Automate monthly investments using the freed-up mortgage payment and any additional savings.
- Revisit your pension contributions each year.
- Review your retirement plan annually and again when you approach age 52–53.
10. My overall recommendation
If I were organising this plan, my priorities would be:
- Sell the rental property if the net proceeds and your non-financial reasons support it. The current estimated net yield is modest, and reducing property concentration is sensible.
- Aim to become mortgage-free after the fixed rate expires and the sale completes. I favour certainty and a lower retirement spending requirement over keeping debt solely to invest the cash elsewhere.
- Increase your AVC contributions, but only after confirming your scheme rules and early-retirement projections. Tax relief is valuable, but flexibility is valuable too.
- Invest the remaining money outside pensions in a diversified, tax-aware way. This is important for your early-retirement bridge.
- Reserve some money for enjoyment. A family holiday, memorable experiences or a meaningful home improvement can be part of a sound financial plan, not a failure to save.
The objective is not to maximise your net worth at all costs. It is to reach your mid-50s with a paid-off home, reliable pension income, accessible investments and the freedom to choose how you spend your time.
