Advice of funding college & pension

Personal details

Age: 51
Spouse’s/Partner's age: 52

Number and age of children: 17 & 13


Income and expenditure
Annual gross income from employment or profession: €130,000 incl Bonus
Annual gross income of spouse: €65,000 + bonus circa €4,000

Monthly take-home pay €7,400

Type of employment: e.g. Civil Servant, self-employed PAYE employees

In general are you:
(a) spending more than you earn, or
(b) saving? Saving

Saving circa €1,500 a month, could be higher


Summary of Assets and Liabilities
Family home worth €475k with a €240k mortgage
Cash of €40k
Defined Contribution pension fund: €450k & spouse €75k

Family home mortgage information
Lender Ulster Bank
Interest rate 0.75% tracker
If fixed, what is the term remaining of the fixed rate?

(No need to tell us the monthly repayments or what term is left)

Other borrowings – car loans/personal loans etc

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


Buy to let properties
Value:
Rental income per year:
Rough annual expenses other than mortgage interest :
Lender
Interest rate
If fixed, what is the term remaining of the fixed rate?

Other savings and investments:

Do you have a pension scheme? Yes - see above
Making monthly contributions of 16% , spouse making 12% contributions.

Do you own any investment or other property? No

Other information which might be relevant

Life insurance:

Life policy of €650k
both have death in service


What specific question do you have or what issues are of concern to you?

Worried about being able to pay for college for both kids and save more into pension. want to get pension contributions for both of us up to 20%.
Not sure what to do with cash & savings - do I need to keep it readily available for college next year.
don't feel secure!

KAPATCHES said:

Not sure what to do with cash & savings - do I need to keep it readily available for college next year.

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I would say so, yes. Whatever about college, an element of emergency funding that you can tap into should be on hand to give you security as most of your investments are in pensions. The €40k cash on hand represents approximately 6 months of your present outgoings.

KAPATCHES said:

Saving circa €1,500 a month, could be higher

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This stands out for me. I think a review of your expenses would be worthwhile to see where your money is going to see if there is any potential room for improvement.

KAPATCHES said:

Worried about being able to pay for college for both kids

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What's the likely plan for your 17-yr old? Will they live at home during college or require accommodation elsewhere? What are the expected annual cash flow demands do you think?

I'd start at doing a spreadsheet and look at your family's current cash flow to see what's coming in and going out. Based on what the 17-yr old's plans are, I'd amend the numbers with the likely college costs and see where you stand after that.

KAPATCHES said:

Monthly take-home pay €7,400

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If your household gross income is €199,000 (€130k + €69k), I calculate that your monthly take home should be higher. Is there an element of pay that is going towards share remuneration etc?

AAAContributor said:

This stands out for me. I think a review of your expenses would be worthwhile to see where your money is going to see if there is any potential room for improvement.

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Thanks will do this.

Our saving were higher but we needed to change car last year & also got hit with 2 sets of braces so that ate a good chuck of savings.

AAAContributor said:

What's the likely plan for your 17-yr old? Will they live at home during college or require accommodation elsewhere? What are the expected annual cash flow demands do you think?

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They want to go to college one they can live at home but the other is in Limerick so we would have accommodations costs.

I’ve been trying to get an idea of costs, I might post them here to see what people think .

AAAContributor said:

your household gross income is €199,000 (€130k + €69k), I calculate that your monthly take home should be higher. Is there an element of pay that is going towards share remuneration etc?

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I’ve only realised that the bonus amounts aren’t included as they are only paid once a year , the bonuses add about €1,350 a month.

When I read that I wonder where all our money goes. Really need to look at our outgoings .

Will look at these & college costs & come back

KAPATCHES said:

Number and age of children: 17 & 13

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So your kids will overlap at third level for at most a year.

KAPATCHES said:

They want to go to college one they can live at home but the other is in Limerick so we would have accommodations costs.

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So only one will need accommodation costs.

KAPATCHES said:

Monthly take-home pay €7,400

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Won't you have enough to cover third-level costs out of regular income? Kids will presumably have some part-time work at some stage as well.

I'm not sure you need to pre-fund at all if you think you can sustain this income for the next decade or so.