# Looking for makeover advice on investment and loans



## Bryan99 (29 Mar 2011)

Age: 32
Spouse’s/Partner's age: 
30

Annual gross income from employment or profession: 
Mine: 36,000

Annual gross income of spouse:
Spouses: 46,000

Type of employment: e.g. Civil Servant, self-employed 
Public sector

In general are you:
Saving somewhat.
After paying all my bills I normally have about 300 left a month. I use this for socialising, buying treats etc!

Rough estimate of value of home
EUR220,000

Amount outstanding on your mortgage: 
EUR260,000 over 30 years

What interest rate are you paying? 
ECB =0.75. Payments are around EUR940

Other borrowings – car loans/personal loans etc
Home improvement loan. Year two of three. I took this out for EUR8,500 and have about EUR5,000 left. The interest rate is 3.75%

Do you pay off your full credit card balance each month? 
If not, what is the balance on your credit card? 
EUR200

Savings and investments:
I have a Quinn Life investment fund since 2006. The principle is EUR5800 but it's only worth 4,900. I've had it for five years and pay in EUR65 a month.

I also have a thousand euro in savings in a Rabo Savings account.

Do you have a pension scheme? 
Public sector

Do you own any investment or other property? 
No

Ages of children: 
1 and 6
Life insurance: 
No

What specific question do you have or what issues are of concern to you?
Up until last month I also worked as a contractor for another company and received a total gross income of EUR40000 a year. This has now come to an end (I reflected this in my gross income above) and I also have to pay child minding and face a possible increase in my mortgage over the next few months. 

I am concerned that if I cash in my policy I will have no rainy day funds left and will realise a loss of nearly 20%. I am considering 

a) Cashing in half and buying EUR2,000 shares in Microsoft and Petrochemical. I think the former is undervalued and represents a good avenue for savings. I also expect the latter to grow over the next 24 months. I know there are no guarantees but the Quinn Life funds have performed so poorly for me that I'd rather take a more hands on approach.

or

b) Cash it in in its entirety and pay off my home improvement loan and finding another place to invest. This would mean starting again with a blank slate. Any ideas on a good way to do this?


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## niceoneted (30 Mar 2011)

Given your combined income and great tracker I think you should be in a position to save more. 
You should do a spending diary to see where your money is going. 
I would hold on to what you have with Quinn but save more in order to be able to buy the shares and also clear the loan.


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## goingforgold (30 Mar 2011)

Does your figures include your spouse's savings etc?


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## SarahMc (30 Mar 2011)

I have to agree thar your savings are very low. You certainly don't have enough imo to invest in risky shares like petroceltic.

Work out where your cash is going, build up 3 months living expenses in the rabo account. What are the exit charges on the fund?


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## Bryan99 (1 Apr 2011)

Hi,

Thanks for the responses. No those figures don't reflect spouse's cash. I think she has about two grand in savings think and she has cleared some loans recently.

There are no exit charges. I am currently invested in the Technology, Emerging Markets and Tech funds (evenly split). I lost 15% of my premium after investing in the Irish/European funds. I am disappointed the policy has never made any money and unsure about continuing with it but I know if I cash it in my loss crystalises.

If I build up three months,where's the place place to keep that money? Shares, the Post Office, Credit Union, Rabo savings etc?

Also, should I concentrate on saving, clearing loan or investing more?

I've been keeping a spending diary  and am surprised by how much I am spending on little things such as haircuts, bottles of water, papers, snacks, etc.

I also have a tendency to splurge, I nearly bought an iPad 2 today even though I know I don't need it.

I should mention I live very near work and I could technically get rid of my car. It a 2001 Clio (65000 miles) but I am reluctant as we have kids and what if  I needed a car down the road? Insurance was just under 500 in October and road tax is 160 every six  months.


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## horusd (1 Apr 2011)

Hi Bryan99

A few observations:

Planning is key to getting finances in order. As you've seen, you are spending money on frivolous things. You need a plan, a definite budget and discipline. Here is a useful spreadsheet:

http://www.askaboutmoney.com/showthread.php?t=145557

As a rule of thumb, you should pay down higher rate loan interest instead of saving with a lower return.

You need to prioritise and simplify you budget targets. Reduce spending, pay down debt, increase savings. *Perhaps in this order*.

Can you hold onto your share investments rather than selling them? Investments like these are long term products. Early encashment almost always entails losses.

Rather than complex investments like shares, perhaps consider a high interest online savings account from the likes of P/TSB. See best buys in Deposits. These are instant access.

If you don t need the car, lose it. A taxi here and there in emergencies will probably cost a lot less than ongoing maintainance, tax etc.


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## Bronte (4 Apr 2011)

You should concentrate on paying down your loans first.  Then you save to an account that is safe and gives you the best interest rate.

It's not good that you and your spouse do not discuss or know exactly what the other has in loans.


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## Bryan99 (4 Apr 2011)

I know where my partner is financially but we manage our affairs somewhat separately after the bills are paid as I am sure many couples do.


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## SarahMc (6 Apr 2011)

Of course many couples do, and whatever works for each couple works for each couple.

I am curious though how you work out your long term savings goals as a couple - eg for children's college, house moves etc, even for short term like holidays.  

Most couples would have separate day to day money, but would save jointly, I ask as perhaps the disposable income cited excludes joint saving, and you would then be in a better position to invest rather than save?


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