Unexpected €5000 expense. What would you do?

timmyntc

https://www.boards.ie/discussion/2058266209/unexpected-5000-expense-what-would-you-do

How many households are pulling in 80k? Not many I'd wager. Nothing typical about it

mohawk

https://www.boards.ie/discussion/comment/119707054#Comment_119707054

For all the talk of society becoming more green there is very little talk of making corporations taking any hit to their profits to protect resources and the environment. Replacing an appliance shouldn’t be more expensive then repairing it. Across all industries quality has been sacrificed to cut costs.

ELM327

https://www.boards.ie/discussion/comment/119707475#Comment_119707475

80k isnt even particularly high for a household income these days. The median wage is over 40k so if you have two people on average incomes they would have 80k+.

To answer the OP question, Id be fine once but then would worry a little as the savings account would be gone. Normally I'd have a lot more in the savings but I just spent 25k on a solar PV array and large domestic battery.

timmyntc

https://www.boards.ie/discussion/comment/119707626#Comment_119707626

Median household income in Ireland is around 45-50k

Less than 20% of households in Ireland earn more than 80k gross

https://www.cso.ie/en/releasesandpublications/ep/p-gpii/geographicalprofilesofincomeinireland2016/incomeinireland/

Scotty #

Today, with both of us with good incomes and the kids grown up, I could pay it this morning and it would only be a very small dent in savings. 10 years ago we hadn't a washer, I'd have had to ask my folks for it and pay them back on the drip.

CaboRoig

I've about half of it in NIS savings. Could probably top up CU loan for the other half but honestly it would leave me pretty much penniless.

RedXIV

Been scraping money together for a house deposit for the last few years so I could take a 5k hit if I had to but it would set us back a bit on the house purchase journey.

I've also been at the point where I'm barely holding my head over water so I'm very keen on getting an emergency fund in place now that the deposit has finally been gathered.

BrianD3

As per the below link, in 2020 93.4% of rented households had savings but the median for the 93.4% was only 3200 euro. Median financial wealth (including pensions, shares etc.) for rented households was 3700 euro.

98% of owner occupied households had savings and the median savings for the 98% was 12500 euro with median financial assets of 20500 euro.

Even considering the fact that some people will understate their means in a household finance survey, that's likely a lot of people in a precarious position if they suddenly need 5k.

https://www.cso.ie/en/releasesandpublications/ep/p-hfcs/householdfinanceandconsumptionsurvey2020/assets/

Scotty #

https://www.boards.ie/discussion/comment/119707475#Comment_119707475

It's not necessarily about income. I know people in 90k+ who haven't a bean because they're up to their eyes in debt. Likewise, there's people in €28k a year who are great with money and would have good savings built up.

mickdw

As a self employed person it seems very odd to me how little savings people have in general.

I'm making average money but I need to keep alot of savings as you never really know what's around the corner.... A client doesn't pay, the economy tanks etc. You really need a couple of years wages in savings to be half secure. A 5000 unexpected bill is a kick in the teeth but it can be paid.

rob316

I have a rainy day fund of about that to cover anything like that. Cars can be notoriously expensive if major things go wrong.

ELM327

https://www.boards.ie/discussion/comment/119707713#Comment_119707713

That's from 2016. Still interesting, but I thought more recent data from CSO had the average/median wage at 43k, not household income

I've just had an unexpected medical expense that will work out about €10k after insurance but €13k before insurance which has to be paid upfront (surgery for one of my kids in London not done here). Insurance giving €3k for surgery under anesthesia and a night in ICU. No coverage for staying in London etc. Absolutely pathetic. So much for health insurance - realistically it's making very little difference to the total cost. Have some savings after many years of struggling to clear debt but now have had to call on the Credit Union again. Be paying it back for years and probably means the same kid won't be able to go to college or will need to contribute herself if she does as we don't qualify for a grant.

Edit - I could have paid an unexpected €5k bill but €13k - no.

Tork

These days, it'd come out of savings but it's still a lot of money in my world. My mind would be whirring, trying to work out how to save another €5,000 ASAP. I still remember the days when payday couldn't come quickly enough and when a bill like that would have been a nightmare come true. Even the thoughts of it now gives me the shivers. As to what I'd have done, I'd have tried to get a loan. Failing that, I'd have turned to my parents as a last resort. I've no doubt they'd have helped me out without being asked twice but I'd be mortified.

Andrea B.

https://www.boards.ie/discussion/comment/119707401#Comment_119707401

I actually do keep old flexes and plugtops, but didn't have a braided one😐.

We are a wasteful bunch.

EOQRTL

https://www.boards.ie/discussion/comment/119707552#Comment_119707552

Cutting costs is only part of it. If say a company that produces fridges makes a unit that last's 25 years a customer will make a purchase maybe 3 times in a lifetime. Now make that same fridge but with a life expectancy of 10 years and all of a sudden it's not too hard to see why items are made to not last as long.

Padre_Pio

I've been saving for a house for the past few years, so 5k would be a hit, but not a big one.

I'm fortunate that my rent is quite low, work mainly from home, and split bills with my housemates so the cost of living crisis hasn't hit us as much as others.

https://www.boards.ie/discussion/comment/119707993#Comment_119707993

People don't want to own a fridge for 25 years anymore. You name it, electronics, cars, appliances are all changed regularly. Why make a 25-year fridge when people change their kitchen ever 10-15 years anyways? Who buys a second hand 10 year old fridge?

timmyntc

https://www.boards.ie/discussion/comment/119707834#Comment_119707834

Yes I cant find any more detailed info on household gross incomes aside from the last census, hopefully soon the new census results will be out and give us a better picture.

The big thing to remember though is that many households have 1 parent working, or none working, pensioners, dolers, and everything in between. So not nearly as simple as looking as median wages and doubling up from there.

CSO do a stat of household gross discretionary income (post taxes) but Im not sure if it includes rent/mortgages or not. Would be good to get a stat of household net incomes less expenses (childcare/rent/mortgage/bills etc), or maybe household savings would be an even better stat?

Mellor

https://www.boards.ie/discussion/comment/119707030#Comment_119707030

Expected lifetime for fixtures is about 10 years. Some will last longer. anytime after that they will have things fail. You can get years out of something that half works but when the critical part goes its dead.

https://www.boards.ie/discussion/comment/119707045#Comment_119707045

There's a pretty logical reason for that.

A TV or any appliance used to be very expensive, relatively speaking. They also had consumable parts. The first colour TVs were ~£500-1000 in the 60s. That's maybe £5,000-10,000 in todays money. For a 24" screen that burned through vacuum tubes pretty quickly, you had to service it and replace parts. The labour was a fraction of the cost of the TV.

Today's technology does not have consumables. A 24" screen today is about 100 quid. The labour to repair the TV, would be worth more than the TV. It's not that they are making TVs badly these days, its that they are so much better at making them.

LeeroyJ.

Just been dealing with that exact issue, neighbours builders have been damaging all sorts of things around my house that needed urgent repair (3700 euro). Have had to dip deep into savings and hope to recover it from their or my insurance, but for now it's out of pocket and a huge hit to my finances.

lawrencesummers

5k is just short of a weeks wages so id cover it handy.

kirk.

https://www.boards.ie/discussion/comment/119708164#Comment_119708164

Not entirely true

There's lots of tech with modular parts mobiles , PlayStation's, external power supplies, PC's, laptops,

ELM327

https://www.boards.ie/discussion/comment/119708200#Comment_119708200

You'd need to be clearing 350k to be getting 5k net wages. What is your job?

kirk.

https://www.boards.ie/discussion/comment/119708261#Comment_119708261

Binman in Beverly hills he said

EOQRTL

https://www.boards.ie/discussion/comment/119708061#Comment_119708061

Our last cooker was handed down from my wife's mother. It was 29 years old when it finally gave in the ghost. Id have zero problems with owning a fridge 25 years once it still functions.

kirk.

https://www.boards.ie/discussion/comment/119708272#Comment_119708272

Ya not everyone would upgrade kitchen after 10-15yrs

My whirlpool fridge freezer must be nearing 25 years old or thereabouts, tiny rust marks on front but no issues , dunno on efficiency but I don't think there's any issues with the seals anyhow

Ubbquittious

https://www.boards.ie/discussion/comment/119706959#Comment_119706959

There are free ones on adverts.ie if you are stuck

Greyfox

Bank loan of 5k so, no other choice

I have it available atm so would put a slight delay on installing my kitchen. Overall though, save a fair bit each month so I've only had one loan outside of my mortgage and that's for my car, which I primarily paid for out of pocket. Car loan gets overpaid. I'm in a position where I can enjoy self but also try to avoid stupid expenses if I can.

lawrencesummers

https://www.boards.ie/discussion/comment/119708261#Comment_119708261

Mod on boards