Q. After 32 years in my job, I have been “given a package”. The amount involved is € 134,000 and already I am so confused with my options. Should I invest, or pay off my € 100,000 tracker mortgage, build that extension I have been planning for years etc. I am 54 years old, married with one child but will find work.  Paddy – Drogheda Co Louth

A. Financially you are well on the way to self-sufficiency Paddy. You are entitled to € 10,160 basic tax exemption and € 765 for each complete year of service. This means that your tax free element of your € 134,000 is € 10,160 + € 24,480 ( € 765 X 32 weeks) totalling € 34,640. However, you may also be entitled to an additional € 10,000 called the “Increased Exemption” available under certain conditions ( three of them – trust me, you qualify ) leaving therefore a total of € 89,360 to be taxed.. Therefore, while your tax liability is € 35,744 ( at 40%) you will still receive a tidy € 98,256 after tax. At this point, I would look at your entire financial circumstances. The extension aspiration might be warranted if your home is cramped – but paying off your tracker mortgage may be more timely – you’ve been hurting this last year… If you have any short term high interest debt though, pay it off first. You MUST do a budget – how much per month does it cost you to run your life and your family ? To sum up, sort out the lump sum – put it away even short term with the best deposit taker to give you time to think. Remember you also do have seed capital to potentially start up your own business if you are entrepreneurial ! Best wishes

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