Looking for advice on how best to make use of my savings

[shepherd_0806]

Firstly, apologies if I've posted this in the wrong forum, feel free to move.

Here goes.

Hi all,

I am looking for some advice on how best to make use of my savings. I work in tech, tho am currently between jobs having been made redundant a month or so ago. Not sure how long it'll take to find a new role as the market isn't great now, but hopefully within a month or two. I was on just over 90k at the time I was let go.

Anyway, heres my current financial situation -

115k in current account with an Irish bank (yes I know that's stupid)

1.5k in revolut current account. I top that up from the Irish bank account when needed

25k in revolut savings account at 2 1%

25k in prize bonds - I seem to win quite often on these

24.8k in shares in a large financial services company They are at their highest in at least 6 months so I'm considering selling some or all of them, tho I might wait til April when the dividend is due, however there's a risk in this if they drop in value. The drop could be more than the dividend payout

In terms of pensions, I've a defined benefit pension I was paying into for about 10 years, it ended in 2015 when I took redundancy and has sat there since.


I've also got a defined contribution one from the job I've just been made redundant from, maybe 4-5 years in that, minimum contributions from employer and myself, so not worth a lot. It's sitting there now also.

Primary home - we are 2.5 years into a 23 year mortgage, borrowed 250k, 230k owed, at 2.55% for next 2.5 years. House would definitely be worth twice what is currently owed


I own an apartment with a sibling, half each. Exactly 10 years left on the mortgage, about 82k owed, currently at 3% I think until pretty much the end of the term. It's rented out and pays for itself comfortably


No other debts, I own my car outright, it's grand and will easily do me for 3-5 years no problem

Other than being out of work, which I'm not used to and is stressful, I'm in a good place financially.
My partner has a good job and earns just over 80k, so we can survive on one salary easily enough.
We are not flashy, both from very humble, working class backgrounds.
We would like to invest in our house this year as it's old and needs insulation and a bit of modernisation and some improvements but I've no idea how much we'll spend on that.

I've always been very risk adverse when it comes to money, growing up my parents really struggled at times, so that has coloured my view on money a lot.
Looking forward to hearing some advice.
Thank you.

 

[conor_mc]

What’s the value of your DC fund?

Any idea what your DB will be worth to you on retirement?

Any kids? Now or in the future?

 

[shepherd_0806]

I don't know the value of those two pensions but I'll find out.
No kids now or in the future.

Edit -
Current value of the DC pension fund is just under 20k, protected value at retirement is just over 41k.

Edit -
Value of the DB pension at retirement is just over 25k on the latest statement I have, June 2013, exactly 2 years before I exited it. So it's probably a little above that. I will request an up-to-date statement this week

 

[ClubMan]

Primary home - we are 2.5 years into a 23 year mortgage, borrowed 250k, 230k owed, at 2.55% for next 2.5 years. House would definitely be worth twice what is currently owed

What is the value of the property?

I own an apartment with a sibling, half each. Exactly 10 years left on the mortgage, about 82k owed, currently at 3% I think until pretty much the end of the term. It's rented out and pays for itself comfortably

Even if it's paying its way this may not be the most appropriate investment for you as it, along with your home, concentrates a lot of risk in a single asset class/geographic region.

I'm considering selling some or all of them, tho I might wait til April when the dividend is due, however there's a risk in this if they drop in value. The drop could be more than the dividend payout

This sort of attempting to time the market isn't really a prudent investment strategy.

The general advice would tend to be...

1. Tackle any unsecured high rate debts (not relevant here?)
2. Get your mortgage down to a comfortable level in terms of LTV and/or monthly repayments
3. Maximise your pension contributions up to your age related tax relief limit
4. Create a diversified investment portfolio

The fact that you're out of work right now and plan to do some house upgrading imminently may influence the priorities here.

Ideally the household finances should be looked at holistically but the nature of your relationship with your partner isn't obvious - e.g. are you married or just cohabitating etc. - so maybe that's not appropriate here?

 

[Persia]

What age are you?

 

[ClubMan]

25k in prize bonds - I seem to win quite often on these

What is your actual annualised return on these? I suspect that it's marginal and maybe negative after inflation. I have some prize bonds myself but only c. 1% of my overall net worth, and even that's probably far too much. I'll probably cash them in imminently to use the money for something useful. In your case the €25K could most likely be used better - even paying it off your mortgage will most likely give a much better effective return.

 

[shepherd_0806]

Sorry I should have stated my age. 46.
In answer to other qs from @ClubMan
House is worth in the 450-500 I should confidently say.
Re. The apartment, any sale of that would require the agreement of my sibling who co owns it. We have a very good relationship, we've always been of the opinion to keep it til the mortgage is cleared (Jan 2035) and decide what to do then.
I'm in a long term relationship, not married, living together 9 years.
Re. the large amount off money in my current account, what would be a good place to put that, somewhere safe that gives a reasonable return? My revolut savings gives 2.1% but I'd not be comfortable putting any more into that given the horror stories you hear about their customer service.

 

[ClubMan]

the large amount off money in my current account, what would be a good place to put that, somewhere safe that gives a reasonable return?

Your mortgage(s?)?

If you're looking for the best deposit rates then see here:

Best Buy - Savings Best Buys

Savings Best Buys: There are 3 savings best buy threads on AskAboutMoney that are updated frequently. Instant Access and Notice Accounts - Lump sum variable rate savings. Fixed Term Deposits - Fixed Lump Sum Term Deposits from a few months to a few years. Regular Savings - Smaller sum...

www.askaboutmoney.com

But I think that your overall household financial situation should be reviewed systematically and holistically rather than just moving cash from one relatively low return deposit account to another slightly higher one.

 

[shepherd_0806]

@ClubMan
Don't know the exact return info on the prize bonds, I'll endeavour to find out.
That seems like good advice re. using it to pay down the mortgage, I never considered that. We are half way thru a 5 year fixed rate term on the mortgage (total term of 23 years) with ptsb, we got it when buying the house. It's at 2 55%
We took out 250k of a mortgage and bought the house for 395k, so loan to value was good.
With the increase in house prices in that time, that will only have improved.
I do regret not putting in more of my own money and getting a smaller mortgage at the time.

What is the best way to go about reviewing the overall household financial situation systematically and holistically? Speak to a professional financial advisor maybe?

 

[ClubMan]

Speak to a professional financial advisor maybe?

Doing a full money makeover here for the full household finances would be a good start and might even be sufficient.

Key Post - Basic information required for the "Money Makeover" forum

It can be difficult, but please try to use a meaningful title in your thread For example "27 year old with mortgage arrears". You will get a much better and much more coherent answer if you give as much information as possible in your first post. For example, if you give your mortgage rate, it...

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