What to do next?

[Sheridan]

Hi,
Looking for some advice please.

Age: 39
Spouse’s/Partner's age: 42

Annual gross income from employment or profession: 32K
Annual gross income of spouse: 66K

Type of employment: e.g. both public service jobs

In general we are

(b) saving?

Rough estimate of value of home 450k
Amount outstanding on your mortgage: 105k
What interest rate are you paying? 2.95%

Other borrowings – car loans/personal loans etc car loan 6k

Do you pay off your full credit card balance each month? No
If not, what is the balance on your credit card? 1500

Savings and investments: Scots prov with profit 250 per month(year 9 of 15), now worth 26k , also Norwich Union celebration bond (original investment 10k pounds due to mature 2010)

Do you have a pension scheme? Compulsory state (also paying AVC)

Do you own any investment or other property? Have paid a deposit on Portugese property (56k) due to complete in April will need 100K mortgage to cover the balance

Ages of children: (4,6,9,11)

Life insurance: Mortgage life insurance, also have a policy each (not for much )


The original aim of our investments were to provide an deucational fund for the children. However with the Scots prov the guaranteed return is 38.6k after the fifiteen euros which won't cover the investment. If I cash it in now I have only lost a small amount and could pay off car loan, credit card and put in a high interest account. The lump sum investment will mature next Jan and will probably go the same route with that.

Are we mad to be going ahead with the Portugese property? if our deposit was less would consider pulling out but 56k is too much to lose for us.

The important thing for me is to be able to pay the bills, save for the kids education and have a reasonable lifestyle.

Thanks

 

[capall]

If for example the portuguese property is only worth 100k on the open market when completed then effectively you will have lost the 56k anyway,except by keeping the property you might eventually recoup this. 156k seems cheap for a property in portugal ?
What was your original thinking and what has changed now ?

 

[Sheridan]

Hi,
The Portugal property is worth about 250k now we are purchasing it for 225k and extra costs, taxes etc(family member involved). So our investment will be 200k at the end. The original plan was to have a home in the sun and to rent it to off set some of the costs.

I know we are in a good financial situation compared to other posters. But I want to keep it like that as long as possible and making the right decisions now. My real concern was whether to cash in the Scots provident investments and put the money somewhere else or pay off outstanding loans. The amount we put in as been wiped out by the government pension tax, so it will make things tight 2 mortgages and the policy payments.

Thanks