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Breaking my pension to buy a car

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  • 26-11-2014 11:49am
    #1
    ThatFatGal
    Registered Users Posts: 56 ✭✭


    Hi

    Please excuse me if this sounds dumb - just looking for an opinion.

    I am in a secure job and I might have to get my own car for commute soon for a new job I'm starting.

    I have a very small saving of around 5K which I do not want to break for emergency purposes.

    The only way I can buy a reasonable car (nothing too expensive - something around 3-4K) is either get a small loan or else break my pension plan with my current employer. I only joined the pension plan about 2 years ago and I believe I have around 5-6K saved in that account.

    Considering that I will get deducted an income tax and I will be left with around 4K which I can buy a car with and the rest into my personal savings account.

    I will probably join a pension plan with my new employer next year. I'm in my early 30's.

    Now, does this sound unreasonable?

    I'd rather not draw a loan if possible - just never had a loan and feel a bit uncomfortable about getting a loan.

    Thank you.


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    #2
    mickman
    Closed Accounts Posts: 4,661 ✭✭✭mickman


    get a loan and pay back early. it will look good for you when you go for a mortgage

    done go near the pension plan


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    #3
    Gheadphone
    Registered Users Posts: 196 ✭✭Gheadphone


    Agreed, you should try and build your pension up in your 30s, it will keep earning interest for the next 35 years tax free. Id get a loan, thats what theyre for (plus interest rates are so low it should be decent value).


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    #4
    ThatFatGal
    Registered Users Posts: 56 ✭✭ThatFatGal


    Thank you both - now, where can I get a loan that I can pay off within a year?

    Credit union or my bank? Never had a loan so completely at loss here!


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    #5
    bee06
    Registered Users Posts: 4,514 ✭✭✭bee06


    ThatFatGal wrote: »
    Thank you both - now, where can I get a loan that I can pay off within a year?

    Credit union or my bank? Never had a loan so completely at loss here!

    See who has the best rates and will lend you the money you want.

    And for future info you can't use your pension fund like that unless you have contributed AVC's to it and you can only cash in a certain % of your AVC amount.


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    #6
    Mrs OBumble
    Registered Users Posts: 25,941 ✭✭✭✭Mrs OBumble


    Is it possible to lease rather than buy a car here?


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    #7
    on_my_oe
    Registered Users Posts: 991 ✭✭✭on_my_oe


    Mrs OBumble wrote: »
    Is it possible to lease rather than buy a car here?

    It is, but it's expensive for private individuals

    OP - Get a credit union loan and overpay, I did


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