paradoxmillin
New Member
- Messages
- 2
Age: 34
Spouse’s/Partner's age: 30
Annual gross income from employment or profession: approx 100000
Annual gross income of spouse: 55000
Monthly take-home pay: Avg E4300 Spouse: E3062
Type of employment: PAYE
In general are you:
(a) spending more than you earn, or
(b) saving?
Saving E3700 per month.
Rough estimate of value of home: 425K
Amount outstanding on your mortgage: 266K
What interest rate are you paying? 2.8% fixed for three years
Other borrowings – car loans/personal loans etc - None
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:
97K in savings and 44K in employer stocks
State Savings 10 Year Bond which is funded by the monthly child benefit - approx 3000E
Do you have a pension scheme?
Yes, default organizational pension schemes. Worked abroad for a few years. So, current portfolio value is only 60K and 10K.
Do you own any investment or other property?
No.
Ages of children: 2 years
Life insurance:
4 times gross salary for me and 6 times gross salary for wife, both through work
Private life insurance - 150k, other than the mortgage cover.
Specific Questions:
Which investment option would you suggest and why?
Investment options:
Option 1: Buy an investment property worth 350000 to let. If I pay 20% down payment, I'd end up having to pay approximate EMI of 1500 Euros PM considering an interest rate of 5%. If I get a rent of 2300, after tax, I might be left with 150 Euros and that too excluding maintenance costs.
This isn't anywhere near ideal. So, one option is to increase the down payment to 30% so that I could cover the maintenance costs, if any.
Option 2: Mortgage: Payoff the lumpsum against the home loan. Convert from fixed to variable when the rate expires and make additional payments each month. Close the loan faster and then rent out the current property. Move to another new house then so as to give the benefit of lesser interest rate on primary residence as it'll be a logical step to get mortgage with lesser interest rate.
Option 3: Payoff the lumpsum against homeloan. Max out pension contributions. Divert the incoming additional cash to equities.
This seems to be the popular suggestion. But even this option will cost capital gains, trading account fees etc., if I were to sell the stocks at some point and doesn't seem ideal.
Option 4: any other??
Thank you in advance.
Spouse’s/Partner's age: 30
Annual gross income from employment or profession: approx 100000
Annual gross income of spouse: 55000
Monthly take-home pay: Avg E4300 Spouse: E3062
Type of employment: PAYE
In general are you:
(a) spending more than you earn, or
(b) saving?
Saving E3700 per month.
Rough estimate of value of home: 425K
Amount outstanding on your mortgage: 266K
What interest rate are you paying? 2.8% fixed for three years
Other borrowings – car loans/personal loans etc - None
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:
97K in savings and 44K in employer stocks
State Savings 10 Year Bond which is funded by the monthly child benefit - approx 3000E
Do you have a pension scheme?
Yes, default organizational pension schemes. Worked abroad for a few years. So, current portfolio value is only 60K and 10K.
Do you own any investment or other property?
No.
Ages of children: 2 years
Life insurance:
4 times gross salary for me and 6 times gross salary for wife, both through work
Private life insurance - 150k, other than the mortgage cover.
Specific Questions:
Which investment option would you suggest and why?
Investment options:
Option 1: Buy an investment property worth 350000 to let. If I pay 20% down payment, I'd end up having to pay approximate EMI of 1500 Euros PM considering an interest rate of 5%. If I get a rent of 2300, after tax, I might be left with 150 Euros and that too excluding maintenance costs.
This isn't anywhere near ideal. So, one option is to increase the down payment to 30% so that I could cover the maintenance costs, if any.
Option 2: Mortgage: Payoff the lumpsum against the home loan. Convert from fixed to variable when the rate expires and make additional payments each month. Close the loan faster and then rent out the current property. Move to another new house then so as to give the benefit of lesser interest rate on primary residence as it'll be a logical step to get mortgage with lesser interest rate.
Option 3: Payoff the lumpsum against homeloan. Max out pension contributions. Divert the incoming additional cash to equities.
This seems to be the popular suggestion. But even this option will cost capital gains, trading account fees etc., if I were to sell the stocks at some point and doesn't seem ideal.
Option 4: any other??
Thank you in advance.
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