rollingstone
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- 14
Age: 43, single male, no child dependants
Annual gross income from employment or profession: €112,000 as senior manager in multinational
Monthly take-home pay: c.€5,226
In general are you: (a) spending more than you earn, or (b) saving?
Saving. I do not make a regular savings deposit because of the interest rate environment. I retain a minimum €3k in my bank of Ireland current account to avoid excessive bank charges, and to pay occasional outlays (motor tax and insurance, property taxes, payment for parents private medical insurance etc.). I also transfer funds on an ad hoc basis to my equity account and Rabo savings.
Rough estimate of value of home: €190,000
Amount outstanding on your mortgage: €139,000, repaying c.€922 a month. Original mortgage taken out in 2003 with EBS. Switched to Bank of Ireland in October 2011 (€157,500 mortgage), currently 17 years to run on mortgage.
What interest rate are you paying? 4.25% variable rate. I realise this is not the most competitive rate I can currently get. I need to address this point (the usual Irish inertia applies to my delay in doing so).
Other borrowings – car loans/personal loans etc.: None. In early 2015 repaid outstanding balance, from savings, on car loan with credit union.
Do you pay off your full credit card balance each month? Yes.
Savings and investments: savings €32,500 - €25,000 on deposit with Rabo savings a/c (1.25% gross interest), €2,500 in credit union savings, €5,000 in BoI.
Equity investments (with Goodbody) - €115k. Portfolio consists of mainly US technology, with additional investments in Irish stocks – BoI, Ryanair and CRH. Excluding the purchases of Irish shares over the past 18 months, I have held the other equities for c 6 years and they have performed very well. However the overall value has decreased by €10k in the past month.
Do you own any investment or other property? No
Do you have a pension scheme? Yes, defined contribution occupational scheme. The latest fund value is €165,627 (investment option in full - equities). Per the pension admin projections, based on current estimates I could have a pension of €27,300.00 p.a. and a Retirement Lump Sum of €153,700.00 if I retire at age 65. I stopped making monthly AVCs about 2 years ago as I felt that putting the spare cash into equities that i select myself would yield a greater return.
Life insurance: guaranteed mortgage protection plan with Zurich, taken out in 2011. Taken out based on 22-year term for home mortgage. Mortgage protection and serious illness cover of €157,500 reducing over a term of 22 years to match the mortgage. Monthly premium - €47.
I also currently have death (lump sum of 4 times my salary at date of death plus the value of my retirement savings account) and disability (2/3 salary less social welfare entitlements) cover via my job.
What specific question do you have or what issues are of concern to you?
As the thread title suggests, I feel I've reached a fork in the road in my life (classic case of middle age I suppose).
Financial - my priority is making the best of what I have, and ideally retire younger than 65 to be able to live a comfortable life. I grew up in a large family and we didn't have much, therefore I have a very conservative view towards the money that I have accumulated, on the back of working very hard and the huge sacrifices that my parents made to enable me to have what I do have today.
I'm currently at a stage/age that I feel I need to make some strategic decisions, my considerations currently include:
(a) Use my savings to make a lump sum AVC to the pension, maximising the tax relief threshhold.
(b) I currently live in a three bed semi in a large housing estate. Living on my own means that this is perfectly adequate. However I've always wanted to live in the countryside, and don't like the clausterphobic nature of a housing estate, including for example where you can hear it when your next door neighbour flicks the light switch. Such is general modern living these days I know. A detached rural property in my area (Cork) would cost minimum €350k.
As above, I have c €50k equity in my current home. I could sell it, or rent it out - no shortage of demand, monthly rent €850-€950 attainable.
(c) Invest in a 2-bed seaside apartment in my original homeplace down Kerry way - current asking price €160,000. Apart from the investment, it would give me somewhere to stay when needed down home direction and a long term option to live there some day. Given it's location, there would be regular demand for short term occupancy. Estimated total annual rental income €13k between the months of March and September (likely there would be demand Oct-Dec, but again I'm taking a conservative approach). Estimated cost of mortgage 10k per annum based min 75% financing over 20 years (that's a quick and dirty calculation, taken from Bonkers.ie). Of course there would be additional overheads and administration (time an effort advertising and arranging bookings).
(d) use my savings to reduce my existing mortgage balance.
(e) reduce my stake in equities and hold in cash for the time being. I'm invested in the long term in equities but the current market sentiment seems to be bearish. As stated above I've lost a bit on my portfolio recently, wondering if it's time to stop the bleeding.
(f) severance - the company I am working with is currently going through a period of restructuring through the group. I do not believe that I am being considered for the programme, but could possibly make it happen voluntarily (uncertain about the chances of it being accepted, but obviously need to manage the situation very carefully). Based on my length of service and current redundancy terms, I would get a net c €60k.
Finally, from a non-financial perspective - I feel weary, due to feeling burn-out from the job and other personal matters which I have gone through over the past decade or so. If I had the courage of my convictions, I would probably take a year out to go travelling/work abroad, life is short. However I fear that I would not get anywhere near the salary level on my return and at the age I would be, opportunities would be scarce enough. Maybe this is a case of far away hills are always greener.
I have not given up hope of having a family, but at the moment the above is my situation.
Something, I think it was Brendan said on here once, resonated with me - there's no point in living like a pauper to die a millionaire.
Thank you for taking the time to read this. I would greatly appreciate not just your financial recommendations but your life experience recommendations. Go raibh mile maith agaibh.
Annual gross income from employment or profession: €112,000 as senior manager in multinational
Monthly take-home pay: c.€5,226
In general are you: (a) spending more than you earn, or (b) saving?
Saving. I do not make a regular savings deposit because of the interest rate environment. I retain a minimum €3k in my bank of Ireland current account to avoid excessive bank charges, and to pay occasional outlays (motor tax and insurance, property taxes, payment for parents private medical insurance etc.). I also transfer funds on an ad hoc basis to my equity account and Rabo savings.
Rough estimate of value of home: €190,000
Amount outstanding on your mortgage: €139,000, repaying c.€922 a month. Original mortgage taken out in 2003 with EBS. Switched to Bank of Ireland in October 2011 (€157,500 mortgage), currently 17 years to run on mortgage.
What interest rate are you paying? 4.25% variable rate. I realise this is not the most competitive rate I can currently get. I need to address this point (the usual Irish inertia applies to my delay in doing so).
Other borrowings – car loans/personal loans etc.: None. In early 2015 repaid outstanding balance, from savings, on car loan with credit union.
Do you pay off your full credit card balance each month? Yes.
Savings and investments: savings €32,500 - €25,000 on deposit with Rabo savings a/c (1.25% gross interest), €2,500 in credit union savings, €5,000 in BoI.
Equity investments (with Goodbody) - €115k. Portfolio consists of mainly US technology, with additional investments in Irish stocks – BoI, Ryanair and CRH. Excluding the purchases of Irish shares over the past 18 months, I have held the other equities for c 6 years and they have performed very well. However the overall value has decreased by €10k in the past month.
Do you own any investment or other property? No
Do you have a pension scheme? Yes, defined contribution occupational scheme. The latest fund value is €165,627 (investment option in full - equities). Per the pension admin projections, based on current estimates I could have a pension of €27,300.00 p.a. and a Retirement Lump Sum of €153,700.00 if I retire at age 65. I stopped making monthly AVCs about 2 years ago as I felt that putting the spare cash into equities that i select myself would yield a greater return.
Life insurance: guaranteed mortgage protection plan with Zurich, taken out in 2011. Taken out based on 22-year term for home mortgage. Mortgage protection and serious illness cover of €157,500 reducing over a term of 22 years to match the mortgage. Monthly premium - €47.
I also currently have death (lump sum of 4 times my salary at date of death plus the value of my retirement savings account) and disability (2/3 salary less social welfare entitlements) cover via my job.
What specific question do you have or what issues are of concern to you?
As the thread title suggests, I feel I've reached a fork in the road in my life (classic case of middle age I suppose).
Financial - my priority is making the best of what I have, and ideally retire younger than 65 to be able to live a comfortable life. I grew up in a large family and we didn't have much, therefore I have a very conservative view towards the money that I have accumulated, on the back of working very hard and the huge sacrifices that my parents made to enable me to have what I do have today.
I'm currently at a stage/age that I feel I need to make some strategic decisions, my considerations currently include:
(a) Use my savings to make a lump sum AVC to the pension, maximising the tax relief threshhold.
(b) I currently live in a three bed semi in a large housing estate. Living on my own means that this is perfectly adequate. However I've always wanted to live in the countryside, and don't like the clausterphobic nature of a housing estate, including for example where you can hear it when your next door neighbour flicks the light switch. Such is general modern living these days I know. A detached rural property in my area (Cork) would cost minimum €350k.
As above, I have c €50k equity in my current home. I could sell it, or rent it out - no shortage of demand, monthly rent €850-€950 attainable.
(c) Invest in a 2-bed seaside apartment in my original homeplace down Kerry way - current asking price €160,000. Apart from the investment, it would give me somewhere to stay when needed down home direction and a long term option to live there some day. Given it's location, there would be regular demand for short term occupancy. Estimated total annual rental income €13k between the months of March and September (likely there would be demand Oct-Dec, but again I'm taking a conservative approach). Estimated cost of mortgage 10k per annum based min 75% financing over 20 years (that's a quick and dirty calculation, taken from Bonkers.ie). Of course there would be additional overheads and administration (time an effort advertising and arranging bookings).
(d) use my savings to reduce my existing mortgage balance.
(e) reduce my stake in equities and hold in cash for the time being. I'm invested in the long term in equities but the current market sentiment seems to be bearish. As stated above I've lost a bit on my portfolio recently, wondering if it's time to stop the bleeding.
(f) severance - the company I am working with is currently going through a period of restructuring through the group. I do not believe that I am being considered for the programme, but could possibly make it happen voluntarily (uncertain about the chances of it being accepted, but obviously need to manage the situation very carefully). Based on my length of service and current redundancy terms, I would get a net c €60k.
Finally, from a non-financial perspective - I feel weary, due to feeling burn-out from the job and other personal matters which I have gone through over the past decade or so. If I had the courage of my convictions, I would probably take a year out to go travelling/work abroad, life is short. However I fear that I would not get anywhere near the salary level on my return and at the age I would be, opportunities would be scarce enough. Maybe this is a case of far away hills are always greener.
I have not given up hope of having a family, but at the moment the above is my situation.
Something, I think it was Brendan said on here once, resonated with me - there's no point in living like a pauper to die a millionaire.
Thank you for taking the time to read this. I would greatly appreciate not just your financial recommendations but your life experience recommendations. Go raibh mile maith agaibh.
