Where to focus savings: trade up v pension: single parent

I

Isabel S

Registered User
Messages
22
Hi All,

I’m looking to trade up:

Current value of apartment: 350-370k; outstanding balance about 108k (fixed at 2.25% for next 2 years). Mgt fees are very high: 2022 they were 6k, 2023 they were 4k. I'm not happy at all about this and want to move out in 1-2 years if feasible.

I have been saving 1.5k for the last 6 months as advised by a broker to show good saving history. So 9k so far saved.

Salary is 80k in permanent full time public sector role, I am a single parent to one child aged 4; childcare support from family, ECCE fees: 260 euro a month (attends 3.5 hours a day). Will start primary school in Sep 2024 and no childcare fees then.

No other loans apart from mortgage; circa 90k in shares (CGT needs to deducted from this amount if/when sell them). Circa 5k cash as buffer.

My questions:

Would it be wise to focus all my saving efforts into saving the monthly amount till I do trade up? I can’t invest/save much beyond 1.5k each month. Not putting away any AVC into pension or anything else. Am I foolish for not topping up pension? I have a pension of 115k from previous employment. Also, its abit morbid, but I will most likely will inherit 1/2 house in Dublin in 20 plus years but probably don't want to factor this in at this stage?


Any advice appreciated, I'm very conscious there is no buffer for my child if things goes wrong financially (by action from me).
 
I think we need some more details to advise.

What age are you?
When did you become a public servant and join their (presumably DB) pension scheme?
How much would you need to borrow to trade up?
 
Sarenco said:
I think we need some more details to advise.

What age are you?
When did you become a public servant and join their (presumably DB) pension scheme?
How much would you need to borrow to trade up?
Click to expand...
Hi Sarenco,

I am 43 years old, joined public sector in 2018 and looking to borrow 200-240k (max 3.5 times salary). Also to add 80k salary is 90% of salary, as currently on 0.5 day unpaid parental leave over a 5 day week. Thank you very much.
 
Ok, that all looks very doable.

You have presumably been accruing decent pension entitlements over the last 5 years and a €115k pension pot from your previous employer isn’t too bad @43.

As a public sector worker, I don’t think you need a big cash buffer.

I’d say go for it but try and keep the mortgage borrowings below 3 times your gross income if you can.
 
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