Looking for advice, illness and insurance

[MrsBeechRyan]

Personal Details
Age 52
Spouse age 55
Children 21 ,21 &18

Income and Expenditure
Annual gross income €56,000
Annual gross income of spouse €200,000

Monthly take home pay €7,500 (remainder left in company)

Type of Employment
Me civil Servant
Spouse -Contract (own limited company)

In general savers

Summary of Assets and Liabilities
Family Home worth €750K with €84K mortgage repayment €1,300/mth tracker 4.1 BOI 6yrs remaining
2nd property worth €300K with mortgage €54K repayment €660/mth tracker 4.2 BOI 8 yrs remaining
rental €1,700/mth

No other borrowings
Credit cards paid in full each month

Other savings and investments
€40K in savings account. 2 kids currently in uni

Will likely have inheritance approx €1-200K

Pensions
Me Public sector 34yrs with AVCs x 15 yrs
Spouse €260K from previous employment (current position only x 3 yrs)
€80K in private pension

Adequate health insurance
Life insurance and critical illness on both of us
Income protection on both salaries

Recent illness of spouse. Critical illness claim of €184,000 received.
Prognosis good and has returned to full employment.

Need advice re best placement of critical illness claim.

My gut says *clear home mortgage
* keep emergency fund of €20K
* redirect all of spouse’s salary to company pension
* use remainder of insurance claim as monthly “income”
* take a well deserved holiday

 

[Brendan Burgess]

1) Absolutely - clear mortgage

2) Take professional tax advice on planning how to best extract the profits from the company. Maximising pension contributions may be the answer, but it may also be worthwhile building up cash and trying to avail of Retirement Relief or Entrepreneurial Relief.

I don't like this "Monthly take home pay €7,500 (remainder left in company)" unless it's part of a documented tax plan which I presume it's not as you have not mentioned it.

You will have no mortgage payments.
You will have rental income.
You don't need much of an emergency fund.

Brendan

 

[MrsBeechRyan]

1) Absolutely - clear mortgage

2) Take professional tax advice on planning how to best extract the profits from the company. Maximising pension contributions may be the answer, but it may also be worthwhile building up cash and trying to avail of Retirement Relief or Entrepreneurial Relief.

I don't like this "Monthly take home pay €7,500 (remainder left in company)" unless it's part of a documented tax plan which I presume it's not as you have not mentioned it.

You will have no mortgage payments.
You will have rental income.
You don't need much of an emergency fund.

Brendan

Thanks Brendan, Need to find the professional tax advisor , have no insight into retirement relief or entrepreneurial relief.
With future 3rd level fees and accommodation anticipated a back up fund of cash will give me a sense of peace.