Help with finances

[bagoftricks]

Age: 29
Spouse’s/Partner's age: 28

Annual gross income from employment or profession: €110,000 €27,500 bonus per annum

Annual gross income spouse:NA

Type of employment: employed

Expenditure pattern: not spending more than we are earning but not saving as much as we should be right now

Rough estimate of value of home:€520,000
Mortgage on home:€320,000
Mortgage provider:First active
Type of mortgage: Tracker
Interest rate: .95% above ECB

Other borrowings – car loan €16,000

Do you pay off your full credit card balance each month? Yes
If not, what is the balance on your credit card?

Savings and investments: €17k in cash, €73k in vested share plan(non approved, outright share plan) before tax
October 08 based on current share price: €68k before tax
October 09 based on current share price: €68k before tax

Do you have a pension scheme? Yes

Contributing 10% myself and employer contributing 5% roughly €1300 per month

Do you own any investment or other property? No

Ages of children: 5 months

Life insurance: yes 3 times salary and mortgage cover


What specific question do you have or what issues are of concern to you?

Although I find myself in a decent position for the most part I would like some advice in regards to what i should be doing regarding savings and pensions. I know that i spend way too much on day to day luxuries which i am looking to cut back on but can you give me some on advice on how i could best put my money to work. Should i put my savings off the mortgage, cash in shares and put them off the mortgage. The shares and the industry i work are quite volatile so this might be an idea. Any thoughts? Please feel free to ask any questions.

 

[Welfarite]

As a start, you have 17k in cash so pay off the car loan of 16k ...that will help your cash flow.

 

[z109]

If you use your share money to pay off some of your mortgage debt, that may bring you to an LTV of <50%. You could be able to beat your existing mortgage payment down.

The reason for my caution is that it appears that many lenders are no longer offering ECB trackers, but instead tracker variables (which can be adjusted by the lender without the ECB raising rates). If your current mortgage is already ECB tracker fixed at +0.95, you may not want to switch to a variable rate that starts lower, but could end up higher. Or am I making no sense at all?

 

[ClubMan]

many lenders are no longer offering ECB trackers, but instead tracker variables (which can be adjusted by the lender without the ECB raising rates).

This is misleading. A tracker rate is a (tracker) variable rate. But it has a fixed margin over the ECB base rate. What you seem to be talking about are "trackers" with a potentially variable margin which are not really trackers at all so since they are largely indintinguishable from standard variable rates which are not pinned to any base rate or fixed margin but will generally fluctuate somewhat in line with ECB rates with the lender reserving the right to set the rate to whatever level/margin they so choose.