# Basic financial suggestions invited



## Palantir_Use (29 Aug 2007)

Single / 32

Salary ? - €42,000p.a. gross 
[€2,400 per month after Savings, Pension tax & VHI]

Rent/mortgage ? - €600pm rent; awaiting "approval in principle" figures to proceed with 100% first-time-buyer mortgage

Pension ? - two:
Current (3 years contributions; Defined Contribution Company pension) 
- 6% EE/ 8% ER contributions; current value c. €18,500
Previous (3 years contributions; Defined benefits Public Sector pension)
- value unknown at this time

Savings ? - three:
Short-term Deposits (€100 p.f.) - c. €6,500 on deposit
Employee Stock Purchase Scheme (€130 p.f.) - c. US$8,100 in stock
Other - c. €1,200 in forestry (matures in 23 years)

Loans ? - one:
Credit Card - c. €3,500 (paying €820 per month)
[no laser card ... so I tend to use the credit card for almost all transactions]

Other outgoings ?
Maintenance Payments - €750 per month

After accounting for extraordinary payments like car insurance/services; birthday/christmas presents and holidays, I never seem to have any cash left over.

Any suggestions ?


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## ClubMan (29 Aug 2007)

Yet another case in which the first comments are:
 why are you saving when you have non mortgage debts to clear?
what is your detailed monthly budget (i.e. expenditure including monthly figures for annual outgoings)?


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## CCOVICH (29 Aug 2007)

What has led you to build up €3,500 in credit card debt?

Why don't you have a Laser card?

Can you use your savings to pay off the credit card?  Or do a balance transfer and avail of 0% interest for a period?

Is it wise to take out a mortgage at this time?  How much are your repayments likely to be, i.e. how much do you want to borrow and over what term?


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## Palantir_Use (29 Aug 2007)

The credit card is mainly lazyness ... I need to find time to get down to my local branch and transfer the money over from the savings.

It got that high because of a holiday and the purchase of a computer ... it normally runs at closer to €500

Why buy now? because I personally doubt that there's ever a "good" time to buy, and because house prices in the Meath area have taken a bit of a tumble recently.

Once I can pay off the credit card, I could do one of two things ...

1. Half the payments to the credit card and increase the deposit savings by the same amount

2. reduce by c. 80% the payments to the credit card; increase the savings as per #1, and get a laser card 

- either way the current setup does not make sense.

the "estimates" I've gotten are c. 1k per month for 35 years ... but in the last four years that figure has been going up faster than my ability to pay it, so with the recent downturn, i gotta get in!


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## ClubMan (29 Aug 2007)

Palantir_Use said:


> The credit card is mainly lazyness ... I need to find time to get down to my local branch and transfer the money over from the savings.


Surely you can deal with this by post or online?


> Once I can pay off the credit card, I could do one of two things ...


Why don't you clear the other loan rather than saving while carrying debt?


> - either way the current setup does not make sense.


Saving while carrying debt makes no sense to me. Using a credit card other than as a cashflow tool and clearing the bill every month before interest charges kick in likewise.


> the "estimates" I've gotten are c. 1k per month for 35 years ... but in the last four years that figure has been going up faster than my ability to pay it, so with the recent downturn, i gotta get in!


On what amount? Don't forget to factor in the once off (conveyancing and related fees etc.) and ongoing (mortgage protection life assurance premiums, home insurance premiums, other ongoing expenses/bills not applicable in a rental situation) expenses associated with buying a house. You probably need to detail your current budget and how this might be impacted by a house purchase.


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## Palantir_Use (29 Aug 2007)

Dealing with the savings account:
- the bank refuse to do ANYTHING to the savings account without me coming in and "shaking hands". I've considered closing the account over this issue several times ... particularly since it only pays 0.25% more interest than a standard 0-notice deposit account

other loan? - the only loan I have is the credit card ... waiting for my 2 kids to grow up so i don't have to pay maintenance would take too long


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## Palantir_Use (29 Aug 2007)

I intend liquidating the company stock and combining it with any balance in the savings account to cover conveyancing costs/solicitors fees/etc related to the purchase.

Also would halt contributing to the savings & ESPP at the same time

This will push my NET monthly pay check from €2400 to €2900

Subtracting the maintenance of 720 leaves me with €2180
Subtracting the amount I spend on rent/food/regular expenses leaves me with €1580

this is more than enough to cover a basic mortgage of €1100 plus house&contents and life insurance, with (hopefully) enough to cover the irregular expenses


(maybe??)


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## ClubMan (29 Aug 2007)

Palantir_Use said:


> Subtracting the amount I spend on rent/food/regular expenses leaves me with €1580
> 
> this is more than enough to cover a basic mortgage of €1100 plus house&contents and life insurance


Make sure to make allowance for possible interest rate hikes.


> with (hopefully) enough to cover the irregular expenses


Better than hoping would be to check what these expenses are or are likely to be and then draw up a budget to check if you can deal with them all.

Karl Jeacle's mortgage calculator suggests that (ignoring owner occupier mortgage interest tax relief) €1,100 would be the repayment on c. €216K over 35 years. Is this the amount that you will be borrowing? Will it buy you much?


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## CCOVICH (29 Aug 2007)

Palantir_Use said:


> Dealing with the savings account:
> - the bank refuse to do ANYTHING to the savings account without me coming in and "shaking hands". I've considered closing the account over this issue several times ... particularly since it only pays 0.25% more interest than a standard 0-notice deposit account



It costs nothing to switch-0.25% is a pathetic return.  There are plenty of threads on the best value savings/deposits-some in the Best Buys forum.


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## Palantir_Use (29 Aug 2007)

Aside from robbing my local post office, or winning the lottery, I don't have a whole pile of choice 

The rental market is unstable, and since I have joint custody of my kids, I cannot just "share" a house/appartment/whatever ... the rent I'm paying is likely to go up in the next few months when I try to extend my lease ...

?


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## ClubMan (29 Aug 2007)

Palantir_Use said:


> Aside from robbing my local post office, or winning the lottery, I don't have a whole pile of choice


Eh? Choice about what precisely? Have you done what I suggested?


ClubMan said:


> You probably need to detail your current budget and how this might be impacted by a house purchase.


And what _CCOVICH _suggested:


CCOVICH said:


> It costs nothing to switch-0.25% is a pathetic return. There are plenty of threads on the best value savings/deposits-some in the Best Buys forum.


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## colc1 (30 Aug 2007)

Palantir_Use said:


> The credit card is mainly lazyness ... I need to find time to get down to my local branch and transfer the money over from the savings.
> 
> It got that high because of a holiday and the purchase of a computer ... it normally runs at closer to €500
> 
> *Why buy now? because I personally doubt that there's ever a "good" time to buy, and because house prices in the Meath area have taken a bit of a tumble recently.*


 
Listening to the experts they could well tumble a lot further and you could apply for affordable housing/shared ownership would be much cheaper, whats the rush?  No offence meant or anything


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## Palantir_Use (31 Aug 2007)

Colc1

The "Affordable Housing" is currently running at c. 225k in Fingal ... and you're locked in for at least 10 years or face a large "claw back".

The "Vox Pop"/"Common Wisdom" says that prices may fall by another 5% (give or take 1%).


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## Palantir_Use (31 Aug 2007)

ClubMan

The bank claims that the return on the savings is 3.75%pa before dirt ... but its still well below inflation ... maybe I overstated abit, but it really isn't growing either 

As to my finances ... MS Money has the following "expense report" (only including essential expenses ... assuming I *stop* spending on CD's, Holidays and buying new computers)

Per Month
42 = Bank Charges / Interest / Payment Protection on Credit Card
40 = Broadband Connection
120 = Phonebills (50% counts towards the Maintenance above)
30 = Satellite TV (100% counts towards the Maintenance above)
210 = Food/Groceries (averaged over 6 months)
110 = Petrol (averaged over 6 months)

Current Occasional Bills
165 per year = AA
350 per year = Servicing for car (Assumes no accidents ... touches wood)
200 per year = Easy Pass road tolls (averaged over 6 months)
400 per year = Insurance

Extra bills ... Electricity/Gas/Bin Charges/etc ... not sure that those figures will be (anyone got averages?)

Extra costs ... 
Household & Contents Insurance - no idea how much this is ...
Life Insurance offset against Mortgage - again ... no idea (but my death in service benefit from my job already tops the amount GMC mortgages have gotten approval in principle for me - don't know if I can tie the two together?)


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## ClubMan (31 Aug 2007)

Palantir_Use said:


> ClubMan
> 
> The bank claims that the return on the savings is 3.75%pa before dirt ... but its still well below inflation ... maybe I overstated abit, but it really isn't growing either


And well below the 5.22% gross _CAR _it could be earning in _First Active's eSavings _account. Of course you probably should use some of the savings to just clear the _CC _balances first anyway.



> Household & Contents Insurance - no idea how much this is ...


 Why not? Did you not retain the renewal notice/payment receipt? Do you not shop around each year?


> Life Insurance offset against Mortgage - again ... no idea (but my death in service benefit from my job already tops the amount GMC mortgages have gotten approval in principle for me - don't know if I can tie the two together?)


 I don't think so. I doubt that you can assign the work policy to a lender.


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## Palantir_Use (1 Sep 2007)

I don't currently pay House&contents insurance ...


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## ClubMan (1 Sep 2007)

Sorry - thought you were a home owner and checked again and see that you rent.


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## Palantir_Use (1 Sep 2007)

Looking to buy 

<edited to remove off-topic question>


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## colc1 (1 Sep 2007)

Fingal affordable housing gone up to e225k really?  When they came around to my work around a year and a half ago they were talking max e170k!!

Then when I applied it was supposed to be either max of 170k or 190k, how come they're going up so much???  Sorry for going a bit off topic


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