Advice needed - Impact of partner taking part-time employment

amascid

New Member
Messages
8
Age: 40
Spouse’s/Partner's age: 39

Annual gross income from employment or profession: 98k (including yearly bonus)
Annual gross income of spouse: 0

Monthly take-home pay: 4800

Type of employment: private sector, paye

In general are you:
(b) saving?: saving about 200/month but we live in a "doer-upper". We plan to use savings for an extension/general refurbishment in 3-5 years.

Rough estimate of value of home: 350k
Amount outstanding on your mortgage: 225k
What interest rate are you paying? split variable rate mortgage 140k@ 2.25% and 85k@4.3%

Other borrowings – car loans/personal loans etc. 5K loan to family member. paying off 200/month

Do you pay off your full credit card balance each month? yes but don't really use credit card
If not, what is the balance on your credit card?

Savings and investments: 25k savings cash

Do you have a pension scheme? yes - about 110k. i contribute 3%, employer contributes 8 %

Do you own any investment or other property? no

Ages of children: 3 (almost) and 5

Life insurance: no, but my employer has a death in service benefit. current value approx 310k.


What specific question do you have or what issues are of concern to you?
My wife took some time out to look after the kids. Now that my youngest is about to start ECCE year she is considering returning to part-time work. She has been offered a part-time job. The hours would be 9-1pm (20 hrs) 5 days a week. Her office would be closed during the summer months (June, Jul, Aug) and she would not get paid. The yearly salary would amount to approximately 12k. I think we will lose the home carer tax credit even though she will be looking after the kids after school. Despite this I estimate (using taxcalc) that we will be about 800-900euro a month better off if she takes the job.

I have 2 main questions:
- Do my calculations look correct? I expect we'll be 800-900 a month better off if my wife takes the job. I'm a little confused as to how it works out when she is paid/works for 9 months a year and how this will impact tax calculations.
- Is there anything on what I've provided above that you think we could improve upon or do.

Also, during the summer months she will have no work. Is it possible for her to claim job seekers during this period if she wanted to seek summer employment?

Thanks in advance..
 
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David1234

Frequent Poster
Messages
214
Using the PWC income tax calculator you would be better off by €802 per month on average. €5,457 non V’s €6,269 should your wife take the job.

2 things I would look at in your shoes-
  1. Your pension is modest for someone your age and on your salary. The additional household income would enable additional yearly contributions of €16,040.
  2. Your average interest on your mortgage is just a little over 3%. There is better value out there. Can you look to move the €85,000 to a lower rate as the 2.25% is very good. If not, look into switching your mortgage.
 

Feemar5

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Messages
296
Regarding Jobseekers Allowance your household income is accessed so I don't think she would qualify during the summer months.
 

SBarrett

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Messages
3,129
Ask your employer to provide income protection cover. If you are unable to work and earn an income, everything goes out the window.

You are in a very expensive time of life, young kids, one salary. Keep living below your means and save each month. Remember, the kids are going to get more expensive, so the demands on your money will increase. You want to have that extra bit of savings to pay for things later. Going without now will help pay for it then.

Steven
www.bluewaterfp.ie
 

amascid

New Member
Messages
8
Using the PWC income tax calculator you would be better off by €802 per month on average. €5,457 non V’s €6,269 should your wife take the job.

2 things I would look at in your shoes-
  1. Your pension is modest for someone your age and on your salary. The additional household income would enable additional yearly contributions of €16,040.
  2. Your average interest on your mortgage is just a little over 3%. There is better value out there. Can you look to move the €85,000 to a lower rate as the 2.25% is very good. If not, look into switching your mortgage.
Thanks for the confirmation. I agree about the pension contributions. I didn’t increase my contributions over the past few years because we really need to save to refurbish the house. Pension contributions will be my focus once we get the house out of the way.

2.25% is a tracker rate. We won’t be able to roll the other portion into that. I’d like a good 10year rate. I wonder if I should wait a few months to see what happens with the ECB?
 

Feemar5

Frequent Poster
Messages
296
She may build up benefit for future years but for jobseekers benefit you need to have paid 104 contributions since first starting work and
  • 39 weeks of PRSI paid or credited in the relevant tax year (a minimum of 13 weeks must be paid contributions*)
or
  • 26 weeks of PRSI paid in the relevant tax year and 26 weeks of PRSI paid in the tax year immediately before the relevant tax year. For 2019 claims the relevant tax year is 2017.
 

amascid

New Member
Messages
8
Ask your employer to provide income protection cover. If you are unable to work and earn an income, everything goes out the window.

You are in a very expensive time of life, young kids, one salary. Keep living below your means and save each month. Remember, the kids are going to get more expensive, so the demands on your money will increase. You want to have that extra bit of savings to pay for things later. Going without now will help pay for it then.

Steven
www.bluewaterfp.ie
Thanks for the tips Steven. I had been looking into income protection and met with a broker but I usually like to procrastinate over things like this :) will seriously look into it again now that we have extra income
 

amascid

New Member
Messages
8
She may build up benefit for future years but for jobseekers benefit you need to have paid 104 contributions since first starting work and
  • 39 weeks of PRSI paid or credited in the relevant tax year (a minimum of 13 weeks must be paid contributions*)
or
  • 26 weeks of PRSI paid in the relevant tax year and 26 weeks of PRSI paid in the tax year immediately before the relevant tax year. For 2019 claims the relevant tax year is 2017.
Ok- she is definitely not entitled to job seekers.. Thanks for posting!
 

Doorstop

New Member
Messages
1
Hi op, I'm sorry I can be of no assistance to you, but can I ask please where did your wife secure such employment? I.e. term time only? Was it offered to her or on a job website ?

I ask as I am a SAHM of 3 kids, youngest about to start ECCE and am desperate to get back to paid employment as we need the extra income badly !, but all part time options would require 14 weeks!!!! Full.time care for the children as that is how many weeks holidays they get from school per year !.( only aged almost 3, aged 6 and aged 8)

Best of luck with it all.
 

David1234

Frequent Poster
Messages
214
Hi op, I'm sorry I can be of no assistance to you, but can I ask please where did your wife secure such employment? I.e. term time only? Was it offered to her or on a job website ?
You could look at the special needs assistant jobs in primary schools. There appears to be a number of openings that may suit families with young children.
 

cremeegg

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Messages
3,028
With a gross income of €98k and a monthly take home of €4,800, I wonder if you are paying too much tax.
 

llgon

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Messages
400
Will you have additional childcare costs with your wife working 20 hours per week? ECCE covers 15 hours. Time for dropping off and collecting as well if pre-school not beside work.

May need to factor days off if children sick, school closed for teacher training, voting, bad weather etc.
 

amascid

New Member
Messages
8
Hi op, I'm sorry I can be of no assistance to you, but can I ask please where did your wife secure such employment? I.e. term time only? Was it offered to her or on a job website ?

I ask as I am a SAHM of 3 kids, youngest about to start ECCE and am desperate to get back to paid employment as we need the extra income badly !, but all part time options would require 14 weeks!!!! Full.time care for the children as that is how many weeks holidays they get from school per year !.( only aged almost 3, aged 6 and aged 8)

Best of luck with it all.
She saw this job advertised on a local notice board. She was also signed up to a job site for mums looking for flexible / part-time jobs..I think it was employmum.ie. Good luck with your search.
 

amascid

New Member
Messages
8
Will you have additional childcare costs with your wife working 20 hours per week? ECCE covers 15 hours. Time for dropping off and collecting as well if pre-school not beside work.

May need to factor days off if children sick, school closed for teacher training, voting, bad weather etc.
We’re still trying to figure out how this is going to work out. It is extremely difficult to find a creche that will keep kids till 1.30/2pm.. We’re on several waiting lists.
 

llgon

Frequent Poster
Messages
400
An alternative option could be a stay at home parent of another child going to the same pre-school as yours. Might be happy to bring them in and take them for an hour afterwards if they get a few Euro out of it.
 
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