Allpartied
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Another option to consider if you have 3 children going to college at the same time that if your income is under 60k you dont have to pay the student contributions, if its under 55k they will each get 1.6k of a grant as well.Can I ask how this scenario worked out for the poster. And put my own situation up for discussion.
I find myself in a similar position. I have four daughters, all close in age. Three will be in Dublin, from September 2022 and when one finishes in May 2023, another one will be starting. So, assuming the youngest goes to Dublin too, it looks like it would be a no brainer for me to buy a small property.
Renting for the next three years, for three children. Then renting two years for two and one year for one. So five years of renting in Dublin.
The cheapest rental, onsite accomodation, is 7k per year, so that is 21k per year, for three years. The cheapest rental apartments in North Dublin are 2k per month, with most demanding a 12 month contract.
I could buy a nice 1 bed apartment, with big sitting room, for 190k. This would, easily, accomodate three sisters.
With a 60k deposit that would leave 130k mortgage.
A couple of problems.
I am 56.
My salary is 80k, gross. There is capacity for contract work, if needed, which can get another 10-15k.
I have a small mortgage ( 50k) left on my PPR, paying 410 per month.
It will only work if I can get an interest only mortgage.
By putting a 60k deposit down, I would deplete my savings. I would have about 25k left.
Are interest only mortgages available for this type of scenario, or would I have to classify the mortgage as Buy to Let?
As far as I can see, if I am paying interest only on 130k, that would be about 6k per year, as opposed to 21-25k per year.
Over three years, that is a saving of, at least, 15k per year. 45k over the three years and 8k for the fourth year and 1k for the final year.
So, buy the property, use if for five years and then sell. If I get back what I paid, I'm still quids in.
I retain my 60k deposit, which I would have spent on rent over the years.
The only risk is a catastrophic property collapse ( 30% or more) .
Am I right, or have I missed something?
Any mortgage that is not your PPR will be at BTL rates and yes there are options to get it as interest only particularly from the non bank lendersAre interest only mortgages available for this type of scenario, or would I have to classify the mortgage as Buy to Let?
The cheapest rental, onsite accomodation, is 7k per year, so that is 21k per year, for three years.
But more importantly, you are comparing apples and oranges to justify the savings. 3 sisters sharing a one bed apartment is miles apart from on campus accommodation.I could buy a nice 1 bed apartment, with big sitting room, for 190k. This would, easily, accomodate three sisters.
Does your under 60k income for 3 children re no student contribution apply in the case of 1 child too ?Another option to consider if you have 3 children going to college at the same time that if your income is under 60k you dont have to pay the student contributions, if its under 55k they will each get 1.6k of a grant as well.
You could put 1/3 of pay into pension to reduce income and if paying 40% rate of tax it will cost 15k but you will save close to that on fees plus grant.
While increasing pension pot by 27k yearly.
Thanks for your reply. It is just an idea, at the moment, but I will have to move in the next few weeks, if it is viable.Any mortgage that is not your PPR will be at BTL rates and yes there are options to get it as interest only particularly from the non bank lenders
But more importantly, you are comparing apples and oranges to justify the savings. 3 sisters sharing a one bed apartment is miles apart from on campus accommodation.
On campus accommodation is probably a single room each sharing with friends or other students. It'll give them some independence
3 sisters living in a one bed apartment sounds awful. No privacy, no space, no independence. You need to be realistic about what university is, its not just about a degree. They will meet friends, boyfriends/girlfriends along the way and they need to be allowed behave like an adult
If you still plan on going the route of buying an apartment, it should be a 2 bed minimum.
It would be a much better idea to sit your daughters down and explain to them that they need to work part time to cover the cost of accommodation. When you paint the picture of the 3 of them sharing a one bed, I think they will be straight out job hunting...
You are taking on €130,000 of debt to fund this idea. That is the risk.Can I ask how this scenario worked out for the poster. And put my own situation up for discussion.
I find myself in a similar position. I have four daughters, all close in age. Three will be in Dublin, from September 2022 and when one finishes in May 2023, another one will be starting. So, assuming the youngest goes to Dublin too, it looks like it would be a no brainer for me to buy a small property.
Renting for the next three years, for three children. Then renting two years for two and one year for one. So five years of renting in Dublin.
The cheapest rental, onsite accomodation, is 7k per year, so that is 21k per year, for three years. The cheapest rental apartments in North Dublin are 2k per month, with most demanding a 12 month contract.
I could buy a nice 1 bed apartment, with big sitting room, for 190k. This would, easily, accomodate three sisters.
With a 60k deposit that would leave 130k mortgage.
A couple of problems.
I am 56.
My salary is 80k, gross. There is capacity for contract work, if needed, which can get another 10-15k.
I have a small mortgage ( 50k) left on my PPR, paying 410 per month.
It will only work if I can get an interest only mortgage.
By putting a 60k deposit down, I would deplete my savings. I would have about 25k left.
Are interest only mortgages available for this type of scenario, or would I have to classify the mortgage as Buy to Let?
As far as I can see, if I am paying interest only on 130k, that would be about 6k per year, as opposed to 21-25k per year.
Over three years, that is a saving of, at least, 15k per year. 45k over the three years and 8k for the fourth year and 1k for the final year.
So, buy the property, use if for five years and then sell. If I get back what I paid, I'm still quids in.
I retain my 60k deposit, which I would have spent on rent over the years.
The only risk is a catastrophic property collapse ( 30% or more) .
Am I right, or have I missed something?
You are taking on €130,000 of debt to fund this idea. That is the risk.
Bank of Ireland seem to be unable to provide interest only options. When you say " non bank lenders" , is that building societies, or other institutions?Any mortgage that is not your PPR will be at BTL rates and yes there are options to get it as interest only particularly from the non bank lenders
That is the unfortunate reality for students today and you as a parent trying to fund the difference.To be fair, they are all working and earning during the summer/weekends. They pay for everything themselves, clothes, food, nightlife, travel and books. But minimum wage, part time jobs, do not pay 2k a month Dublin rentals.
Campus accommodation is, actually, very difficult to access. Most likely you will get it for one year, if you're lucky.
I would second this as well. Make sure you are eligible for every grant and support possible. Speaking to school guidance counselors or paying for advice from someone like an experienced accountant familiar with the grant process could save you thousandsAnother option to consider if you have 3 children going to college at the same time that if your income is under 60k you dont have to pay the student contributions, if its under 55k they will each get 1.6k of a grant as well.
It's not possible to reduce one's reckonable income for SUSI grant purposes by paying into a pension.Another option to consider if you have 3 children going to college at the same time that if your income is under 60k you dont have to pay the student contributions, if its under 55k they will each get 1.6k of a grant as well.
You could put 1/3 of pay into pension to reduce income and if paying 40% rate of tax it will cost 15k but you will save close to that on fees plus grant.
While increasing pension pot by 27k yearly.
As an accountant myself, I would seriously question the wisdom in almost all cases of significantly cutting ones income (in this case by €20-25K) to avail of a grant package worth a fraction of that sum.I would second this as well. Make sure you are eligible for every grant and support possible. Speaking to school guidance counselors or paying for advice from someone like an experienced accountant familiar with the grant process could save you thousands
The idyllic student life, strolling from rooms to campus to union bar, is long gone. Another of the great progressive advances of neoliberalism.
Agreed, I missed the OP's salary of €80k, I thought it was €60k from what I quoted. My point was more around the fact that if you are on the border of eligibility, you should be falling on the right side of it with some guidance.As an accountant myself, I would seriously question the wisdom in almost all cases of significantly cutting ones income (in this case by €20-25K) to avail of a grant package worth a fraction of that sum
Fair enough and that goes without saying but I would still be wary to tell someone 10-15 years off retirement to forego a promotion for example to keep themselves eligible for a student grant or any other similar short-term benefit.Agreed, I missed the OP's salary of €80k, I thought it was €60k from what I quoted. My point was more around the fact that if you are on the border of eligibility, you should be falling on the right side of it with some guidance.
You are mistaken it isIt's not possible to reduce one's reckonable income for SUSI grant purposes by paying into a pension.
No for 1 child its 50k for student contribution or 55k for halfDoes your under 60k income for 3 children re no student contribution apply in the case of 1 child too ?
I was just working of op figures and not suggesting he forgoes anything.Fair enough and that goes without saying but I would still be wary to tell someone 10-15 years off retirement to forego a promotion for example to keep themselves eligible for a student grant or any other similar short-term benefit.
Can you direct me to rules. Our joint income falls below 55k if we exclude invalidity pension.No for 1 child its 50k for student contribution or 55k for half
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