# Is it possible to improve financial situation and work: life balance?



## mgv (29 Aug 2007)

Age: 39
Spouse’s age: 39

Annual gross: 67k
Annual gross of Spouse: 60k

Type of employment: both in health service

House value: 720k
Mortgage: 475k
Mortgage provider: NIB 2 year fixed 3.8%, ending August 2008

No other loans

Credit card: average monthly balance outstanding 350 Euro
Credit card current balance: 900 Euro

Savings/investments (combined savings including spouse): 31k (reinvested ssia’s in savings account, shares /ETF’s and Quinn-life European Fund)

Savings: Combined 450 Euro per month, of which 275 Euro invested in Quinn-life monthly. 

Both in Health Superannuation scheme
No other property or investments

Children: 3 and 5 years
Crèche fee: Euro 1340 per month
Child Benefit used in monthly expenditure

Life insurance: reducing balance on mortgage

General household bills: standard for 4-bed semi
One shared car

Questions: 
Can we improve on our current situation, bearing in mind if interest rates are the same this time next year we will be paying approx. 500 Euro more per month? Both working full time and trying to find a way of one of us taking parental leave to spend more time with our children. However the way crèche fees work the reduction in salary is not matched by the reduction in fees! Would also like a third child but feel too financially stretched at present.


----------



## ClubMan (29 Aug 2007)

You have savings and an outstanding _CC _balance (right now and habitually according to your post). This makes no sense. Clear your _CC _balance.


----------



## PGD1 (29 Aug 2007)

i'm sorry? you have earnings of 127k?  please step back from this an realise what you have got.

I am earning less than either of you and we have one person not working and are managing. The difference between us is in the size of mortgage (and I am saving the child benefit)

The easiest thing to do is sell up and downside or move elsewhere. It's a choice between earning money to pay a big mortgage or looking after your kids.


----------



## mgv (29 Aug 2007)

Will do, advice sought is really for the medium to long term tho, can you help?


----------



## z109 (29 Aug 2007)

Rather than invest in stock market/savings, could you overpay on the mortgage (it would depend on the terms and conditions, of course). This might reduce the long-term financial pressure you are under more than an investment would.

As you are both in public service with secure jobs and pensions, you have little to worry about in terms of the future IMO, so maybe you can look at going down to four days a week (one or both of you) and reduce the creche accordingly (you could either take the same day off and effectively have a three day weekend, or take different days off so one of you is home with the children four days out of seven).


----------



## nelly (29 Aug 2007)

PGD1 said:


> i'm sorry? you have earnings of 127k?  please step back from this an realise what you have got.


agree with this 


PGD1 said:


> The easiest thing to do is sell up and downside or move elsewhere. It's a choice between earning money to pay a big mortgage or looking after your kids.


agreed. 

If one of you gave up to take care of children i think it would be the same or higher income than an awful lot of folks in this country. I am amazed that at 127k pa you genuinely feel you cannot afford to have another child. 

is your job one that you may lose or want to retire early from (high stress)?Could you both job-share?


----------



## F. Kruger (29 Aug 2007)

Get some more life cover. 

You probably have some Death in Service cover through work but I would get some additional Convertible Term over 15/20 years.


----------



## moondance (29 Aug 2007)

What exactly are your current monthly mortgage payments and what will they be when your fixed rate finishes? And what is the term of your mortgage.


----------



## mgv (29 Aug 2007)

Hi Moondance,

monthly mtg repayments are 2300 euro plus 150 for home and life insurance, less TRS of 100 euro


----------



## moondance (29 Aug 2007)

And what is your take home pay per month between the two of you?


----------



## mgv (29 Aug 2007)

nelly said:


> agree with this
> agreed.
> 
> If one of you gave up to take care of children i think it would be the same or higher income than an awful lot of folks in this country. I am amazed that at 127k pa you genuinely feel you cannot afford to have another child.
> ...


Hi PGD1,

I can understand your reply however we moved house two years ago and yes commited to a very large mtg - so that is a decision we now have to live with. It is not an option to move again as the children are settled and one is starting school next week. also it would cost too much in fees. What I would like to do is to optimise our financial situation to improve on our work:life balance if its possible.


----------



## mgv (29 Aug 2007)

moondance said:


> And what is your take home pay per month between the two of you?


Hi Moondance,

take home pay combined is approx 6700


----------



## moondance (29 Aug 2007)

Ok so you have 6700 a month

Expenditure:
2300 mortgage
50 (life insurance minus tax relief)
450 savings / investments
1340 creche

Total expenditure 4140

So you have you have 2560 for living on per month which is loads if you're not eating out lots or going on a lot of holidays!


----------



## Berbatov (29 Aug 2007)

mgv

would have thought that your TRS should be a lot more than 100 euro per mth seeing as you'd be maximising the interest threshold with a mortgage of 475k


----------



## moondance (29 Aug 2007)

And you should easily pay off more on credit card.


----------



## mgv (29 Aug 2007)

Hi Moondance,

Other outgoings include household bills of approx 300 per month (gas, electricity, telephone, car maintenance and petrol etc) plus food/clothing etc for family of four and travel expenses means a zero balance each month. Granted we're saving approx Eur 450 per month but this is our fall back for emergencies.


----------



## mgv (29 Aug 2007)

moondance said:


> And you should easily pay off more on credit card.


Will definitely pay off cc and use it less!

Re going out/ holidays - very rarely go out and didnt take a holiday away this year!


----------



## moondance (29 Aug 2007)

Then I reckon you need to make a note of all your expenditure for a couple of months - food (can you try cheaper brands / shops), bills (can you cut down on your energy usage), clothes for kids (Penneys!?), telephone (cut down on use). That sort of thing so you can find out what you're spending that's not necessary. Also maybe get a cheaper car that's costs less to run - like a 1Litre engine or a diesel.


----------



## mgv (29 Aug 2007)

We dont shop extravagantly, telephone bill is not large, car is 1300cc (1999) reliable VW! Take your point re monthly expenditure, it seems to disappear will look at more closely thanks!


----------



## pc7 (29 Aug 2007)

try work out where the cash is going, do you both buy lunch out every day? if so there is 100 euro a week, so by keeping track of where the money is going you'll have better control over it.


----------



## lazing (29 Aug 2007)

On the face of it you're not in too bad a situation.  
- Certainly eliminate the credit card (or switch to interest-free balance transfer for new business, plenty periodically on the market - but ultimately eliminate credit card long-term debt)
- If very uneasy about mortgage payments, then perhaps look to split-out into different types when fixed term ends, eg half switched to fixed, half to variable.  Where possible accelerate the variable mortgage payments (even an extra 100 euro per month makes a difference)
- Seems like you have a perception that you have no money.  You may be straining yourself to maintain the regular monthly savings.  Perhaps move a portion of this to a "fun" fund, where you spend a little on frivolous items, and enjoy life a little.  Perhaps reduce down your regular savings for a short period, so that you feel you have more cash.

Other suggestions:
- Explore other savings / investment options with the 30k (deposit a/c returns are poor)
- Set yourself some goals / targets as to what you want to achieve.  If you're saving for something specific, it helps.  Having open ended goals will never be achieved.

Good luck.


----------



## bcol1 (29 Aug 2007)

Hi MGV,

so sounds like after you pay the bills (gas, telephone, car maintenance, petrol etc) of 300 month you would have a balance of 2,260. Plus as you mentioned in your original post you are spending child benefit on monthly expenses too (assuming this is 320 for 2 children) - that really means you have 2,580 left over each month to spend on Food / Clothes / Holidays. Unless i'm missing something here, you should have more than enough cash each month (And you also have the early childcare supplement of 1K per year for each child, are you saving this?)
As other posters recommended, you really need to start tracking where that 2,580 is being spent - which will mean writing down everything you spend according as you spend it, so maybe being a little notebook with you so you don't forget to jot anything down. You should soon be able to see where the money is going, and will probably realise you are spending a lot more on certain things than you would have realised, and this will hopefully help you decide where cutbacks can be made to free up cash to allow you achieve a better work life balance, it sounds like it should be possible.

Best of luck.


----------



## abi2007 (29 Aug 2007)

I'm surprised on the money you guys earn you've asked this question. I'm a single parent earning about half what one of you earns my morgtgage payment will be about 700 per month and creche fees 870 per month and i still have enough left over to do the things i want.


----------



## abi2007 (29 Aug 2007)

bcol1 said:


> that really means you have 2,580 left over each month to spend on Food / Clothes / Holidays.
> 
> I don't even come out with that!


----------



## F. Kruger (29 Aug 2007)

> Credit card: average monthly balance outstanding 350 Euro Credit card current balance: 900 Euro



Is there a second credit card?


----------



## mgv (30 Aug 2007)

Hi Kruger,
No other credit card. 

Thanks for everyones comments - we definitely need to keep track of daily expenditure. PC7 your right about the lunches, a sandwich and a drink and you've just about spent a tenner a daily. So for both of us thats Eur400 a month gone! We probably spend more on food than we think, we like to eat healthily and dont go out much - however we shop in Lidl/ Dunnes - great shops for value! Also more goes on the house than we probably realise - it needs a lot of work doing and even a tin of paint etc adds up to the expenses.


----------



## puffin (30 Aug 2007)

We had similiar prob regarding where did all the cash go! For one month we got receipts for absolutely every purchase we made...which was a tough task itself as most of the small buys you never get one! We had to constantly ask for receipts and when we forgot would write purchase into notebook. 
Most receipts detail what they are for so at end of month we were able to itemise exactly where the money was spent. We were amazed at the amount spent on hubbies lunches...usually dodgy sandwiches etc and also the amount spent at garages when filling up with diesel, we always spent 5+ euro on luxury items. It all adds up. It gave us a real wake up call.

 That's about a year ago and we will do again as now have number 3 baby and that will affect our spending patterns. Be ruthless and get a receipt for everything, it's your money and you work hard for it.


----------



## ClubMan (30 Aug 2007)

puffin said:


> Be ruthless and get a receipt for everything


Or just write down each purchase.


----------



## annR (30 Aug 2007)

I have been budgeting rigorously for a couple of years now and it's the miscellaneous cash purchases on lunch and coffees which amount to significant sums. Hate that!  but don't have time / focus to always make packed lunches.


----------



## davidoco (4 Sep 2007)

PGD1 said:


> The easiest thing to do is sell up and downside or move elsewhere. It's a choice between earning money to pay a big mortgage or looking after your kids.



In relation to downsizing.

With your joint income you’ve probably worked hard to live in a house worth 700k. 
I think you are better off by €280 a week and live in a nicer house than the couple with one income of 42k and one person in the home.

I've pasted this in from excel so apologises for the formatting.See this link for proper Excel file (right click and save as) [broken link removed]



Description	2 income	1 income
		2 kids	2 kids
	mortgage	475k	mortgage 200k
	PPR Value	720k	325k

Gross Income		
Parent 1		60000	42000
Parent 2		67000	
	TOTAL	127000	42000

tax and prsi		
tax		39000	8400
prsi @5%		6350	2100
	TOTAL	81650	31500

Tax Credits		
Credit 1 spouse	1760	1760
Credit 1 spouse	1760	1760
PAYE 1 spouse	1760	1760
PAYE 1 spouse	1760	0
Home Carers Credit		770
	TOTAL	88690	37550

Extra Income		
Childrens Allowance	3840	3840
Early Childcare payment	2000	2000
		TOTAL    94530	 43390

Main Outgoings pa		
mortgage		                        30000	12000
child care		           16080	0
those sandwiches and bus fares	2400	2400
2nd income sandwiches and bus fare	2400	
(€10 by 5 days by 48 weeks)	

	net income	
	per year	                         43650	28990
	per month	          3637.5	2415.83
	per week	                       839.42	557.5

	difference	        281.92


----------

