What to do with sum of money

[Poc-ar-buille]

Age: 53
Spouse’s/Partner's age: 49

Annual gross income from employment or profession: 80k
Annual gross income of spouse: 40k

Monthly take-home pay 4.4k

Type of employment: e.g. Civil Servant, self-employed
Private and public sector

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

Spending

Rough estimate of value of home 450k
Amount outstanding on your mortgage: 30k
What interest rate are you paying? 1.05%
Loan 1 (PDH) 30k
Term remaining 15 years
Payment (Capital and interest): 200/month

Other borrowings – car loans/personal loans etc
Spouse credit union loan 15k

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

Savings and investments:
40k fund ring fenced for children university

Do you have a pension scheme?
Yes
Contributing 2.5k per month (max)
So far across 3 pensions total: 230k

Do you own any investment or other property?
Rental 1
Value 350k
Amount outstanding: 350k
Interest Rate: Tracker 1.05%
Management Fees: 2.5k
Rental income 1.85k / month =22.2k / year

Loan 2 60k 1.05% Tracker
Term remaining 15 years
Payment (Capital and interest): 378/month

Loan 3 110k 1.05% Tracker
Term remaining 25 years
Payment (Capital and interest): 408/month

Loan 4 180k 1.05% Tracker
Term remaining 25 years
Payment (interest only): 158/month

Loan 5 sold off property 8k 1.05% Tracker
Term remaining 4 years
Payment (Capital and interest ): 129/month

Loan 6 sold off property 10k 1.05% Tracker
Term remaining 4 years
Payment (Capital and interest ): 193/month

Rental 2
Value 300k
Amount outstanding: 200k (in arrears of 30k)
Interest Rate: Tracker 1.1%
Management Fees: 0.3k
Rental income 1.8k / month =21.6k / year

Loan 7 200k Tracker 1.1%
Term remaining 10 years
Payment (Capital and interest ): 1700/month

Ages of children:
15 and 16

Life insurance:
With work 4x salary


Summary

Paye income net: 4.4k + Rental income: 3.6k = 8k per month
Note accumulated rental losses 70k this reduces tax bill for next two years

Mortgages: Total 3.2k / month
Pension: 2.5k/ month


Question
We have emerged from the recession after some hardship and recovering the tracker mortgages as result of tracker examination.
We hope to get some money from the tracker appeal and wondering what to do with it.
The monthly outgoings generally exceed the income and so savings are falling rapidly
When the accumulated tax losses are used up (currently 70k) then will have to start paying tax on rental income
Then I would plan to scale back the pension contributions.
By then the pension fund would be up to 300k and would probably just contribute 8% plus employer 8%

Concerns
The bank has generously arranged some mortgages until I am 80 years old.
One loan of 180k is interest only.
Should I try to pay this down or continue with pension contributions.

Is 2045 too far in future to be paying mortgages?

Total borrowing 600k

If we get a lump sum in tracker appeal: what should we do with it?

As outgoings can be high at moment I would plan to pay down the 30k arrears and put rest in savings.

 

[Bronte]

Can you edit the post and put in the interest rates on each loan. Including the credit union.

If your outgoings exceed your time income you will go under. Don’t understand why you’re paying into a pension rather than paying down debt, starting with one with the most expensive interest rate.

Tracker money should also be used to pay down debt.

What income will you have in your seventies to pay the loans/mortgages.

 

[Poc-ar-buille]

Can you edit the post and put in the interest rates on each loan. Including the credit union.

If your outgoings exceed your time income you will go under. Don’t understand why you’re paying into a pension rather than paying down debt, starting with one with the most expensive interest rate.

Tracker money should also be used to pay down debt.

What income will you have in your seventies to pay the loans/mortgages.

Hi Bronte,
I added the rates. For pdh and rental 1 it's tracker 1.05%
For rental 2 it's tracker 1.1%

I'm paying into pension past 18months and next 24 months because pension was neglected.
And I can afford to pay with tracker compensation.
When that cash runs out it will be back to 8% + 8% employer

I'm not paying down debt because it's on schedule to be repaid per the lenders
And it's at low tracker rate
But in 2045 it will be mostly paid off except for 180k interest only lump sum

I am in two minds about this 180k

Currently things are tight with children in secondary and holidays. Then university hopefully.
After that I might tackle the 180k and convert it to capital and interest