Likely First Time Buyer - Savings V Pension

kennyb3

Registered User
Messages
269
Age: 26

Spouse’s/Partner's age: 26

Annual gross income from employment or profession: 41k

Annual gross income spouse: €40k


Type of employment: accountancy firm


monthly expenditure:

575pm rent (each), 506pm car (16k over 3 years - 2 years left), plus all the usual - electricity, gas, groceries. she has small car loan too approx €4k.



Rough estimate of value of home: N/A


Mortgage on home: N/A


Type of mortgage: N/A

Other borrowings – car loans/personal loans etc Credit card €12k approx re car above, couple of hunderd on credit card that will be cleared by end of teh month

Savings and investments: €10k PTSB, €3k anglo, €1k BOI

Do you have a pension scheme? No


Do you own any investment or other property? No


Ages of children: N/A


Life insurance: None


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

Basically my concern is over having not started a pension yet. Myself and the OH are saving at present, the above info mainly represents my own details, We have approx 14k saved each and are looking to buy a house later this year (€350k to €400k 3 bed semi in skerries/malahide). We will try hold off as long as possible obviously given the fall in prices (read the property pin etc regularly). however we will eventually bite the bullet.

I save about €450 per month at present and want to make sure we get the savings up to approx €35k (for deposit, solicitors fees). That will take approx 8 months at current savings levels. However I ve been working 6 years now and have no pension - i know very little re pensions detail wise and amn't sure if now is the right time to get involved given the stock market turbulance. any thoughts?

however i do know they are tax efficient and that for every €1 i pay in nearly €2 will go into the pot. Obviously though this will lower my net wage and thus my saving ability. Any thoughts? I know 26 is not old but obviously given the way compounding works the earlier i start the better. Should i hold off until house is bought?

Also should I consider clearing some or all of the car loan to lower interest part? Is it worth even clearing 2k? Id be worried if i cleared full amount using savings we might miss out on buying later this year (as deposit gone) if we say the right place.
 
My advice would be to prioritise.

The two options put forward by you are pension or buy a house.

If buying a house is your priority then my advice would be to

1) Pay off loans where the interest rate on them is higher than the rate you are earning on the savings.
2) Start to save for deposit.
3) Once this is done you can then focus on your pension.

You are 26 so plenty of time to sort your future pension requirements. Once the money goes into the pension, it's not coming out for a long long time!

Don't worry about missing out on a place later this year, there is no rush to buy a property in this market - just try and get yourself in a position where you can buy. If this takes a couple of years then so be it.
 
Back
Top