Blackrock1
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More like 15-16k between my wife and I including portions of bonuses but I agree we need to put more in
Review of our financial status
- Thread starter Blackrock1
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More like 15-16k between my wife and I including portions of bonuses but I agree we need to put more in
gnf_ireland
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Sorry, I just see now that you have updated to say your wife is putting in 10.5% of her wages in, as opposed to the 2.5% originally stated
Do keep in mind that your wife is talking about cutting back on her working week, or giving work up altogether. This will dramatically impact your pension as she currently pays in more than you do (assuming your numbers are correct)
Your contribution is currently 5% which equates to 600 euro per month.
What people are trying to say is - you will struggle to maintain your existing lifestyle into retirement, as it is dependent on a continual high income. The minute this drops, for whatever reason be it illness, retirement, redundancy etc, your lifestyle will come crashing down. People are just saying that you should average it out a bit better. But it is completely up to you
I agree that this thread is probably run its course, so good luck OP and hope it all works out for you in the long term.
Blackrock1
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update on this, as much for myself to keep tabs as anything else!
Age: 38 (in a few weeks)
Spouse’s/Partner's age: 38
Annual gross income from employment or profession: 160,000 (plus bonus 30-50k)
Annual gross income of spouse:85,500 (plus bonus 5-7k)
Monthly take-home pay pre bonuses 11,280
Monthly expenses: 9.5k
Mortgage: 2.7k incl protection
Childcare: 850 (ECCE has kicked in)
Car finance – 650
Family living expenses (i.e. monthly DDs, groceries etc): 1.65k (increase related to two income protection policies totalling 250 a month)
Spending money each per month : 1,850 (3.7k in total)
Mortgage overpay / savings – 1,750
Type of employment: both private sector
In general are you:
(a) spending more than you earn, or BREAKING EVEN
(b) saving?
Saving
Rough estimate of value of home 1.15m
Amount outstanding on your mortgage: 490k – 20 years
What interest rate are you paying? 2.5% 5 year foxed
Other borrowings – car loans/personal loans etc Car PCP 650 per month
Do you pay off your full credit card balance each month? YES
Savings and investments: Cash on deposit 20k
Do you have a pension scheme? 83,500 in a self-managed scheme with Davy. I pay 5% of my salary monthly into my pension + 4% employer. wife pays 5% and so does her employer and so does her employer and has done for the past 12 years so maybe a similar ish amount in her pot
Do you own any investment or other property? NO
Ages of children: One daughter aged 4, one more due shortly
Life insurance: Mortgage protection, policy that pays 4-6x salary on death, looking at serious illness cover
So we have managed to get the mortgage down from 600k to 490k mostly related to savings and a once off bonus related to a liquidty event. Keeping the payments the same and switching to UB for the best rate has brought the term down. Pension needs attention but for the next 2 years will focus on the mortgage plus my wife will be on maternity for a year (getting paid for 7 months of it) so some of this will have to be covered.
Prettier picture than the last post appreciate still not to everyones taste in terms on the spending etc!
Age: 38 (in a few weeks)
Spouse’s/Partner's age: 38
Annual gross income from employment or profession: 160,000 (plus bonus 30-50k)
Annual gross income of spouse:85,500 (plus bonus 5-7k)
Monthly take-home pay pre bonuses 11,280
Monthly expenses: 9.5k
Mortgage: 2.7k incl protection
Childcare: 850 (ECCE has kicked in)
Car finance – 650
Family living expenses (i.e. monthly DDs, groceries etc): 1.65k (increase related to two income protection policies totalling 250 a month)
Spending money each per month : 1,850 (3.7k in total)
Mortgage overpay / savings – 1,750
Type of employment: both private sector
In general are you:
(a) spending more than you earn, or BREAKING EVEN
(b) saving?
Saving
Rough estimate of value of home 1.15m
Amount outstanding on your mortgage: 490k – 20 years
What interest rate are you paying? 2.5% 5 year foxed
Other borrowings – car loans/personal loans etc Car PCP 650 per month
Do you pay off your full credit card balance each month? YES
Savings and investments: Cash on deposit 20k
Do you have a pension scheme? 83,500 in a self-managed scheme with Davy. I pay 5% of my salary monthly into my pension + 4% employer. wife pays 5% and so does her employer and so does her employer and has done for the past 12 years so maybe a similar ish amount in her pot
Do you own any investment or other property? NO
Ages of children: One daughter aged 4, one more due shortly
Life insurance: Mortgage protection, policy that pays 4-6x salary on death, looking at serious illness cover
So we have managed to get the mortgage down from 600k to 490k mostly related to savings and a once off bonus related to a liquidty event. Keeping the payments the same and switching to UB for the best rate has brought the term down. Pension needs attention but for the next 2 years will focus on the mortgage plus my wife will be on maternity for a year (getting paid for 7 months of it) so some of this will have to be covered.
Prettier picture than the last post appreciate still not to everyones taste in terms on the spending etc!
gnf_ireland
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First of all, congratulations on the pending arrival. I am sure you are all looking forward to it, and your 4 year old in particular. It will be great for your wife to have a 'little helper' 
Regarding the mortgage, kudos for switching for a better rate. If you done nothing else it will make a big difference in the long term. A 490k mortgage should be perfectly manageable on your salaries.
I think you need to increase the emergency pot a little bit more, to give you a little bigger buffer. I am not sure how long your wife is planning to spend on maternity leave, but from her point of view I am sure she would look to take some unpaid leave at the end. This may eat into your reserves in the short term, and something to be careful of.
Regarding the PCP - when does the car(s) financing end and are you planning to pay the balloon payment or re-PCP again for a further window?
Pensions as you say are low (in comparison), so think you should consider being creative with your bonus. If I was you, I would pay for a family holiday from it, put 50% of the remainder against the mortgage and the other 50% (net) into the pension fund. This is particularily important if the government reduce the tax inventives for paying into a pension from marginal rate to 20-25%, as muted. You can still pay into the pension fund for 2017 - although not for much longer. The limits for a 38 year old is 20% of your salary.
Regarding the mortgage, kudos for switching for a better rate. If you done nothing else it will make a big difference in the long term. A 490k mortgage should be perfectly manageable on your salaries.
I think you need to increase the emergency pot a little bit more, to give you a little bigger buffer. I am not sure how long your wife is planning to spend on maternity leave, but from her point of view I am sure she would look to take some unpaid leave at the end. This may eat into your reserves in the short term, and something to be careful of.
Regarding the PCP - when does the car(s) financing end and are you planning to pay the balloon payment or re-PCP again for a further window?
Pensions as you say are low (in comparison), so think you should consider being creative with your bonus. If I was you, I would pay for a family holiday from it, put 50% of the remainder against the mortgage and the other 50% (net) into the pension fund. This is particularily important if the government reduce the tax inventives for paying into a pension from marginal rate to 20-25%, as muted. You can still pay into the pension fund for 2017 - although not for much longer. The limits for a 38 year old is 20% of your salary.
Blackrock1
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yes she is she cant wait ! and is old enough to get properly involved.
We actually switched the mortgage twice, initial signed with EBS, got 2%, then moved to BOI another 2% and then to UB to get the cheapest rate on a 5 year fix so that was a useful exercise.
Emergency pot needs to be more like 40k. Mat leave will be 13 months or so, so 6 months unpaid.
PCP is for another 2 years, will probably do the same again (roll into another) unless things change and we need two cars, in that case i would get out of the PCP arrangement and buy two older cars outright most likely. for as long as we only need one im happy to continue financing in this way.
have prioritised the mortgage over pension for now and probably will for the next couple of years, if i can get to a position where i can see a path to be mortgage free by 50 then ill start to prioritise pension.
We actually switched the mortgage twice, initial signed with EBS, got 2%, then moved to BOI another 2% and then to UB to get the cheapest rate on a 5 year fix so that was a useful exercise.
Emergency pot needs to be more like 40k. Mat leave will be 13 months or so, so 6 months unpaid.
PCP is for another 2 years, will probably do the same again (roll into another) unless things change and we need two cars, in that case i would get out of the PCP arrangement and buy two older cars outright most likely. for as long as we only need one im happy to continue financing in this way.
have prioritised the mortgage over pension for now and probably will for the next couple of years, if i can get to a position where i can see a path to be mortgage free by 50 then ill start to prioritise pension.
Blackrock1
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I am going to update this annually, to keep me honest if nothing else. Not looking for advice really rather its a useful exercise for me to do every now and again. Main target over the next 5 years is pay down the mortgage, aim to be mortgage free by 45/46 and max pension contributions where possible.
Age: 39
Spouse’s/Partner's age: 39
Annual gross income from employment or profession: total including bonus 375k (large portion is bonus related, has been paid this year and will be paid next year but who knows after that.
Annual gross income of spouse:82,500 (plus bonus 5-7k) - will probably take a long career break later this year.
Monthly take-home pay pre bonuses circa 9k once my wife departs the work force
Monthly expenses: 9k
Mortgage: 2.7k incl protection
Childcare: 450 - monthly allowance for camps, activities etc
Car finance – 750
Family living expenses (i.e. monthly DDs, groceries etc): 2,250
Lifestyle money: 2.8k
Mortgage overpay / savings – 0
Type of employment: both private sector
In general are you:
(a) spending more than you earn, or BREAKING EVEN
(b) saving?
Saving
Rough estimate of value of home 1.2m (but who knows now!)
Amount outstanding on your mortgage: 457k – 18 years (have been paying this down)
What interest rate are you paying? 2.5 (UB high value fixed for another 3 years)
Other borrowings – car loans/personal loans etc Car PCP 750 per month
Do you pay off your full credit card balance each month? YES
Savings and investments: Cash on deposit 70k with 30k or so earmarked to pay off mortgage
Do you have a pension scheme? 93k in a self-managed scheme with Davy and 50k in an irish life scheme through employer. I have been maxing my pension contributions the last few years.
Do you own any investment or other property? NO
Ages of children: One daughter aged almost 6, and one under 2, no more planned.
Life insurance: Mortgage protection, policy that pays 4-6x salary on death and also have income protection cover.
Age: 39
Spouse’s/Partner's age: 39
Annual gross income from employment or profession: total including bonus 375k (large portion is bonus related, has been paid this year and will be paid next year but who knows after that.
Annual gross income of spouse:82,500 (plus bonus 5-7k) - will probably take a long career break later this year.
Monthly take-home pay pre bonuses circa 9k once my wife departs the work force
Monthly expenses: 9k
Mortgage: 2.7k incl protection
Childcare: 450 - monthly allowance for camps, activities etc
Car finance – 750
Family living expenses (i.e. monthly DDs, groceries etc): 2,250
Lifestyle money: 2.8k
Mortgage overpay / savings – 0
Type of employment: both private sector
In general are you:
(a) spending more than you earn, or BREAKING EVEN
(b) saving?
Saving
Rough estimate of value of home 1.2m (but who knows now!)
Amount outstanding on your mortgage: 457k – 18 years (have been paying this down)
What interest rate are you paying? 2.5 (UB high value fixed for another 3 years)
Other borrowings – car loans/personal loans etc Car PCP 750 per month
Do you pay off your full credit card balance each month? YES
Savings and investments: Cash on deposit 70k with 30k or so earmarked to pay off mortgage
Do you have a pension scheme? 93k in a self-managed scheme with Davy and 50k in an irish life scheme through employer. I have been maxing my pension contributions the last few years.
Do you own any investment or other property? NO
Ages of children: One daughter aged almost 6, and one under 2, no more planned.
Life insurance: Mortgage protection, policy that pays 4-6x salary on death and also have income protection cover.
JSnowWinterfell
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Congratulations!
Did you change job / promotion for the large increase in salary?
Did you change job / promotion for the large increase in salary?
Blackrock1
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nope same role, same company, a lot of the increase is bonus / incentive driven. Co is doing well and i have a big team now. I also make sure to bargain hard at pay review time, one thing i have learned is that generally people will pay you as little as they think you will accept.
@Blackrock1
I think if I was in your (very fortunate) position, I would ask my employer to direct all (or substantially all) of the bonus to your pension.
Bear in mind that your employer's contribution to your pension don't count towards your maximum relieved contributions (assuming your pension isn't a PRSA).
Also, with such a high income, you should definitely set a goal to be mortgage-free by 50 at the very latest.
I think if I was in your (very fortunate) position, I would ask my employer to direct all (or substantially all) of the bonus to your pension.
Bear in mind that your employer's contribution to your pension don't count towards your maximum relieved contributions (assuming your pension isn't a PRSA).
Also, with such a high income, you should definitely set a goal to be mortgage-free by 50 at the very latest.
Blackrock1
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it is a PRSA, im guessing this is something i should look to change?
hoping to clear the mortgage in next 5/6 years so thats the priority for now.