Mid 30s couple trying to make wise financial decisions pre children

[patontheback]

Personal details

Your age: 33
Your spouse's age: 36

Number and age of children: 0 - currently going through fertility treatment

Income and expenditure

Annual gross income from employment or profession: 100k + bonus (15%-30%)

Annual gross income of spouse/partner: 80k + bonus (10%)

Monthly take-home pay: ~€8k combined

Bonus is performance related.

I also receive RSUs amounting to about ~15-20k per year

Type of employment - e.g. Employee or self-employed: Both PAYE workers

Employer type: e.g. public servant, private company: Both Tech (non-engineering roles)

In general are you:

(a) spending more than you earn, or

(b) saving?

Saving €2.5k-3k per month after tax (outside of company shares and pensions)

Summary of Assets and Liabilities

Assets

Family home value: €500k
Car: €16k
Credit Union savings - €35k
Prize Bonds - €5k
Investments - €50k (standard life global index fund 80)
Irish Life pensions - me - €136k
Irish Life pensions - spouse - €75k

Liabilities

Mortgage on family home: €186k. A rated home.

RSUs have been used to fuel pension AVCs + Home improvements to date. Maxing pension for last three years. Home improvements include attic conversion.

Family home mortgage information

Lender: BOI

Interest rate: 1.9%

Type of interest rate: fixed

If fixed, what is the term remaining of the fixed rate? Fixed until July 2026

Remaining term: 23 years

Monthly repayment: ~€830

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? N/A

No other borrowings other than mortgage

Pension information

Value of pension fund: €211k combined, we both make maximum contributions.

Other information which might be relevant

Both work in Tech - quite volatile having both been saved from previous rounds of redundancy. My day could be up any day now hence like a bit of an increased cash on hand for such eventuality. While package may be generous, nothing is a given.

Fortunate to receive a lot of perks in work (strong compensation, bonus, life insurance (6x death in service), fertility treatment coverage (currently funding IVF), Income protection (⅔ salary)), which largely keep me where I am - however, also the fear of stress/burnout is real.

Note the IVF is paid and we’ve embryos frozen, so the bulk of the cost has been paid but building in a buffer in the emergency fund as who knows what future treatments may be needed.

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

My spouse and I both have demanding jobs with strong incomes, and I feel very fortunate to be in the financial position we’re in. A previous inheritance allowed us to pay off a significant portion of our mortgage, which was a decision we made during a period of potential layoffs to provide peace of mind. That choice has made a big difference in helping us sleep easy.

We’ve been trying to make smart financial decisions to prepare for the next chapter of our lives, including starting a family (hopefully soon). While I’ve sought professional advice in the past, I’m now curious to hear from others who’ve navigated similar situations.

Our financial goals:

1. Create flexibility so that we could consider roles with lower compensation but better work life balance once kids arrive
2. Achieve financial independence by ensuring we’re debt-free, have a fully paid-off mortgage, and have sufficiently funded pensions to retire in our late 50s or early 60s.

Our current strategy:

• Stick with our jobs for as long as possible while maximizing pensions.
• Aggressively pay down the mortgage while interest rate is so low.
• We are currently enjoying the double income no kids while it lasts so have a few holidays and treats, but try to save a good portion of our salary to control too much lifestyle creep with salary increases /bonuses
• In theory it’d be nice to maybe upgrade the car but this is purely a want rather than a need…

Are there any other steps we should be taking to set ourselves up for long-term financial stability and flexibility, especially as we prepare for kids? It’d be great to hear any advice based on your own experiences or insights.

Thanks a lot

 

[Persia]

If you're based in Dublin you really won't need a lot of stashed cash to put them through University, likely be able to manage fees quite easily from day to day expenditure.

Big cost if kids have to live in a University town though due to rents and having to eat etc

Carrying a lot of surplus cash but you've explained why....ensure you're getting interst on it ( at a minimum). Maybe buy something like Berkshire Hathaway or similar and sell when you need cash.

I wouldn't necessarily buy a brand new car, get one a few years old with a lot of the depreciation shaken off. I like cars myself and drive a decent German car but always get one 2-3 years old.

For your age, you're doing very well.

 

[Premos]

As you prepare for children, I would start to think how you will manage logistically. You mentioned that you both have demanding job. I would think of the plan in terms of child minding, additional help needed... I would plan for as much help as possible. It makes sense financially long-term to have adequate help and then be able to continue to juggle your jobs.

 

[Sarenco]

I think you’re doing great!

Personally, I would be inclined to liquidate the €50k after-tax investment and throw the proceeds at your mortgage.

Otherwise, I think you’re making all the right financial moves.

 

[misemoi]

If the intended birth givers role might be at risk of redunancy over the coming years when hopefully, you will be growing your family, inform yourself of the legalities of notice periods and notice of redundancy. Examine your contract of employment and have a clear understanding of what notice the company needs to give around redundacy and what notice needs to be given of intention to take leave. I am presuming here fully paid leave, six months plus accrued holidays and bank holidays plus the increased service is very valuable. If it means taking earlier than usual materntiy leave (check the current earliest dates), then at least know your options as you may need to make a decision quickly to take maternity leave. Similar for intention to take unpaid maternity leave. Companies generally want no fuss lay offs and usually treat expectant mothers well.

Also bear in mind how hard it might be to start a new role with young children at home in the event of a layoff. It's not for the faint hearted so in your position I would scenario plan for being a single income family for a time or maybe spending on a lot of help to facilitate it eg nanny versus a creche.