Average Job, No Mortgage. Any advice appreciated

[TommyM1]

Personal details

Age:47
Spouse’s/Partner's age:45

Number and age of children:
2 kids aged 17 and 12

Income and expenditure
Annual gross income from employment or profession: 70000
Annual gross income of spouse: 40000
Monthly take-home pay €5450 for both of us after pension contributions taken out
Type of employment: I work in the retail sector and my wife is a public servant

In general we save about €1500 per month which sits in a normal bank account

Summary of Assets and Liabilities
Family home worth €650,000 with no mortgage
Cash of €50k inn bank
Defined Contribution pension fund: I max it out at 25% of my salary and my employers puts in 6%. Only really started to do this last year. Before that between me and employer I have made a 10% contribution since 1999. Pension worth about €190,000 at the moment but will be about €500,000 by the time I am 60. Will get one and a half times my salary tax free at 60.
Wife has defined benefit pension but smaller value. Her salary is €40k.
Company shares : Too risky, not for me
No other properties

Family home mortgage information
No mortgage. Thank God

Other borrowings – car loans/personal loans etc
No other borrowings




Other information which might be relevant
I have death in service which will give my wife three times my salary should I die. She will also have my pension and the house. I mean how much insurance do you need ?

My eldest is looking at either doing an apprenticeship or else doing a course in the university that is local to us, so hopefully no big accommodation fees etc.


What specific question do you have or what issues are of concern to you?

I think we are doing ok. Our salaries won’t set the world on fire. Just wondering what people think I should do going forward to keep us safe financially in this big bad world or any advice on something that you might think I am doing wrong. All advice appreciated,

 

[PGF2016]

I think you're doing pretty well but If shares are too risky then what lower risk options are there?
Inflation will erode the value of bank deposits.
Property? Check out all the threads on here.
Prize bonds? Where is the return?

 

[jpd]

Presumably your DC pension is invested in shares and not cash?

 

[Sarenco]

I think we are doing ok.

I think you're doing a lot better than ok.

Mortgage-free in your 40s with two kids - that's really impressive.

Just keep doing what you're doing - you're making all the right moves.

Maybe keep a high equity allocation in your pension (even 100% at your age) and move some of your 50k into State Savings Certs.

But, really, that's a detail.

 

[TommyM1]

I think you're doing a lot better than ok.

Mortgage-free in your 40s with two kids - that's really impressive.

Just keep doing what you're doing - you're making all the right moves.

Maybe keep a high equity allocation in your pension (even 100% at your age) and move some of your 50k into State Savings Certs.

But, really, that's a detail.

My AVCs are in a medium risk fund which according to advisor is correct as I am 13 years away from exit

 

[Sarenco]

My AVCs are in a medium risk fund which according to advisor is correct as I am 13 years away from exit

I would be pretty sure the advisor doesn't know your overall financial position.

Mortgage-free home with 50k on deposit in your 40s means you could (and possibly should) take on more risk in your pension.

Also, the fact that your wife has a DB pension would suggest that you could afford to take on more risk than your average 47 year-old.

But that's very much at the margin - the more important point is that you keep maxing your pension contributions.

 

[thedaddyman]

Start with some of the basic's, have you a will in place for example?. Have you done a full tax review to see if there is anything you can claim back and are your credits set up in the best way forward.?

You also have an emergency fund which at roughly speaking 9 months of your take home is probably more then sufficient.

Do you have any planned big spends coming up, work to the house, holiday etc?

After that, it is an investment strategy and it may be worth going to an advisor on that.