Pension in your twenties

talking money
Is there assets tied up in your credit Union loan that you cannot touch until loan is paid off in full . always factor in the amount credit union insist on having to keep on deposit until loan is paid off when you look at the % charged ,As the loan shrinks insist savings required as backing are transferred to pay loan off faster,
 
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Richard

This strongly suggests that you should not be contributing to a pension as you can't afford it.

You do not need to buy a house now while your accommodation is cheap and while you don't expect to live there for very long.

But your circumstances may change. You and, maybe a future partner, might want to buy a house together in Dublin. But you may well be borrowing 90% to buy a house you don't really want while looking at a load of your own money inside a pension cage which you can't access.

When your plans are uncertain, the right thing to do is to keep your money accessible. That trumps everything else.

Brendan
 
Firstly, thank you all for the opinions - it is gladly received.

From advice here and reviewing all said, I won't increase my pension contributions by a further 3K this December. I think I will place a standing order for the after tax amount to a savings account, that account can either be eventually be a house fund or a travel fund if I decide to take a career break over the next few years.

As my employer pays 8%, I pay 5% plus AVC of 6% - I wonder after reading this thread would I be best just to match the employers contribution* (*Although I don't need to pay more than 5% to get their 8%). Then it would be Employer 8%, me 5% plus 3% AVC - as I mentioned earlier the extra 3% isn't felt in my pay package, although it is helpful bringing down the top rate of tax.



Yes, shares are held against the loan.

No non money physical assets are held against this, I am paying ahead of schedule and more than agreed expecting this loan to be gone by Dec 2018 or so, ideally I would like to replace the loan with a standing order to save.
 

I had missed this because I was focusing on the main question. Your financial priority is to clear this very expensive credit union loan.
If you have a loan of €10,000 @12% and shares of €5,000 @0%. you are paying 24% APR on your net loan of €5,000.

You don't need a rainyday fund if you have a good record with the credit union.

Ask them to set the shares against the loan. They will probably refuse. But push them. Then liquidate enough of your assets if there is no penalty to clear this loan.

Brendan
 
Reactions: jjm
Lots of time on askaboutmoney you see advice given on having a large emergancy fund the never ask if the have a sick pay/health insurance which should be factored to the size of fund required especially if the are single ,The best advice any one can give anyone is after there mortgage look very careful at the cost of any loans the take out. some people take out loan from credit unions before it is paid off they get a top up while still paying money into buying shares finish up paying very high % when you look at the amount of money backing up such loans,
 

in a long standing climate of cheap credit , is it any wonder people are so slow to pay down debt ?
 
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