Should have said my property is worth €260k. Thanks in advanceHi, I’d like some advice please about how I should be saving:
Salary: €73,000
Age: 40
Marital status: Single
Savings: €25,000
Loans: none
Credit card: none
Shares: €55,000 (work scheme)
Salary forgo: €12700 into work scheme annually which includes annual bonus & €500 per month from salary (tax efficient)
Pension: DB
Plus avcs: 7.5% of salary into scheme
Rent: €500 rent a room scheme Monthly
Mortgage: €205,000 remaining
Mortgage term: 20 years remaining
Mortgage overpayment; €35,000 (mortgage should be €240k)
Mortgage: PTSB, 3.25%
My question is: I would like to move within the next few years.
Should I keep putting my savings into (a) mortgage, or (b) cash savings or (c) sell shares?
Thanks for all your advice
Thanks for replies. Yes, 3 yearsIs there a minimum holding period for the company share scheme to avail of tax breaks?
Thanks Brendan. I’m hoping to buy a home up to €350k. I’m hoping equity, savings and shares bridge the gap. My current home will be sold.The key thing we need to know is what is the price range of the house you wish to trade up to?
I presume you are not trying to keep your current home as an investment?
As a single person, it's much easier to sell you own home first and then be free to buy. With kids, it's much more difficult.
1) Cash is king - stop making any voluntary payments into your pension scheme. You can catch up after you have bought the house and know where you stand. If your gross is higher, you may be able to get a larger mortgage.
2) You should not have shares in your employer's company after the tax benefit has expired. So, no matter how good you think it is as an investment, sell as man as you are allowed to.
3) You will have 10% in cash , so you do not need any other emergency or rainyday fund.
4) permanent tsb is the most expensive lender for existing customers. But I don't think it's worth switching as you intend to move to a new lender when you buy your own house.
When you are ready to trade up
1) Get loan approval from one of the non-cash back lenders. Avant is the cheapest followed by Finance Ireland and AIB.
2) I would not go to an expensive lender like permanent tsb to get cash back and hope to switch. The market is changing with the departure of KBC and Ulster. Pick a good lender now and plan to stay.
3) Put your own house on the market and if you get a good offer sell. When you have exchanged contracts, you will be able to exchange on a new house.
Brendan
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