The ask Bandage about mortgages thread

[Gavrilo-Princip]

Yeah it is in fairness the one complication though is that I’m with UB.

So I don’t know should I jump ship now with their impending exit from the market. AIB are meant to be taking over their residential mortgages over the next couple or years.

I can switch to Avant for 2 years fixed at 1.95% but it will cost €1’500 approx up front in solicitors fees, valuations etc which is putting me off as they don’t make any contribution towards the switching fees.

[Julio_Geordio]

@gilgamboa

I don’t know if anyone ever came to a firm conclusion on that

I have. I would say priorities for extra money should be as follows.

1. Pay off all high interest loans, credit cards, car loans etc chop up the credit card when finished
2. Save a few quid for a rainy day, every month until you’ve a pot to get you through a storm
3. Max out the pension

If you’ve done all that then maybe look at overpaying the mortgage.

I wouldn’t ever though. If I’d done all that I’d start investing in ETF’s. Mortgage is the cheapest money you’ll ever get & inflation is your friend if you’ve a mortgage.

[The_Most_Infamous]

Exchange tracking funds will hit a wall eventually though surely…are we not due a good auld recession/stock market correction?

[Julio_Geordio]

@The_Most_Infamous

Exchange tracking funds will hit a wall eventually though surely…are we not due a good auld recession/stock market correction?

We are of course, but it all evens out in the long run. Timing is for belts

[The_Most_Infamous]

Emerging market equities then is the next question…get them on a low fee charging ETF fund and you’re in decent shape over 20-30 years.

[Biff_Egan]

The tax man will come for 41% of your gains every 8 years. And you can’t offset losses

[gilgamboa]

@Julio_Geordio

I wouldn’t ever though. If I’d done all that I’d start investing in ETF’s. Mortgage is the cheapest money you’ll ever get & inflation is your friend if you’ve a mortgage.

I’d be similar. But I don’t think it’s that clearcut. Having no mortgage gives you massive options. And the taxation of efts and similar is a big negative.

[Phil_Leotardo]

If a mortgage is our only loan, is is not better if you can pay it off early if you are able to do so with a few lump sum payments?

Or will investing in your pension fund serve you better?

[Julio_Geordio]

@Phil_Leotardo

If a mortgage is our only loan, is is not better if you can pay it off early if you are able to do so with a few lump sum payments?

Or will investing in your pension fund serve you better?

Max the Pension. You are basically getting a 50% return straight away, and the earlier the money is in there the earlier it can grow

[TreatyStones]

We’ll all be dead before the time comes to collect though. You’d be better off spending it in the here and now.

[Appendage]

That’s it.

Although I do use the inflation is my friend logic to my life partner as I spiral further into debt.

Pensions are grand but why wait 20 years.

[gilgamboa]

@Phil_Leotardo

Or will investing in your pension fund serve you better?

The tax relief on pension investment trumps all… Plus your investment keeps growing tax free within the pension scheme…max it out if you can afford it

[Julio_Geordio]

@TreatyStones

We’ll all be dead before the time comes to collect though. You’d be better off spending it in the here and now.

Push the boat out, get the bigger island

[The_Most_Infamous]

@TreatyStones

We’ll all be dead before the time comes to collect though. You’d be better off spending it in the here and now.

That is a fact I reckon. Might change my tune when I turn 40.

[Perez2017]

Does anyone have any advice on life cover for mortgage? I am paying irish life 32 a month with bill cover, etc. I have a fairly secure job, should i switch to a basic, cheaper package?

[gilgamboa]

@Perez2017

Does anyone have any advice on life cover for mortgage? I am paying irish life 32 a month with bill cover, etc. I have a fairly secure job, should i switch to a basic, cheaper package

Impossible to answer based on this… Are you asking if you shoukd get cheaper cover for an existing mortgage?

Bare minimum requirement is the value of mortgage is covered at all times… So a cheap policy will decline in value in line with mortage

Do you have dependants is key next question. If you die is there a need for a lump sum for family

Does your pension in work have a death in service benefit that is essentially a life policy?

I’m not selling you anything but go to a fee paying advisor (who isn’t tied to an Ins company)
Who will review your overall position… Hard to advise otherwise

[Perez2017]

Yeah, cheaper cover for an existing mortgage. No dependants.

[Anniepower]

Are there two people named on this?

[glasagusban]

I was looking at this recently, it may be different for me because I have a “gold-plated” civil service pension but I came to the opposite conclusion. For me it was a question of paying a good whack extra contributions to buy more years of pension contributions. But the gains didn’t seem to me to massively outweigh the opportunity cost of using the money now or within the next 5-10 years. Actually, now that I think about it maybe I should have factored in another two promotions, that might make a difference alright. Even still, I think I’d get better use out of the money now.

[artfoley]

@glasagusban

I was looking at this recently, it may be different for me because I have a “ gold-plated ” civil service pension but I came to the opposite conclusion. For me it was a question of paying a good whack extra contributions to buy more years of pension contributions. But the gains didn’t seem to me to massively outweigh the opportunity cost of using the money now or within the next 5-10 years. Actually, now that I think about it maybe I should have factored in another two promotions, that might make a difference alright. Even still, I think I’d get better use out of the money now.

pension is far from gold plated, then again its better than DC pensions.

that said, i should have bought back the years when i was a CO. it’ll cost me around 248 per fortnight now to buy back the extra 8 years. or well over 100k over the next 18 years or so. dont think its worth it so im paying an extra 150 per month on both the family home and the apartment so both terms end about 5 years before i retire.

figuring in 2 promotions? are you gunning for A/Sec?