I’ve a while left until then. I’ll be pushing the cards all in so.
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You’d want your head examined paying off the mortgage if you have extra money lying around. I’m not being facetious when I say that. @Raylan is right. Its the cheapest money you’ll ever get your hands on. If you’ve a mortgage and are paying 2- 3% interest it is a natural hedge against the runaway inflation we have at the moment. Load up on AVCs if you have a few extra bob lying around. If you need something for kids 3rd level education maybe a Zurich dynamic fund or something might be for you if you just want to preserve the value of your money. Waste of time having it sit in a bank account anyway.
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I’ve always wondered why leaving it in a savings account is deemed a waste. I get the inflation argument but there are surely arguments against investing it also.
Yes you can choose a low risk investment but surely the returns on these are low also There are fees associated with your investment even if it is does shite. There are no penalties for the broker if they fuck your investment. They still get a fee. They also get a good chunk of your profits if it goes well.
Say tomorrow your investment makes 15% and it coincides with a broker fee crystallisation. The broker takes his cut. The day after, the investment takes a turn and you haven’t cashed out, does the broker hand his bonus back? Does he fuck.
Depends what you mean by “a while”
20 plus ‘hopefully’!!!
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Yeah but you are 100% going to lose long term vs inflation. If you put €1,000 in your credit union in 2018. In nominal terms its still a €1,000. In real terms though by my rough calculations its probably more like €753.65 today looking at CPI index and predicting 2024 inflation. Compound that over next 10 years and it will be further eroded. You can set up and manage your own portfolio. If you are risk averse you can set up a growth portfolio and all you really want is something that will beat inflation year on year.
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How do you go about doing that? I’m loathe to go to a financial advisor or the likes of Irish Life. Might be an irrational distrust. Would be happy to go low risk like Govt Bonds.
The awkward types online were pushing Gold bigly during the pandemic but despite a 15-20% increase in the price of gold since. any gains have been eroded by inflation.
Need to set one up again in EIRE. Should I go with current bank, or look elsewhere? e.g. Credit Union? Not sure if they do them or not etc…
My pal has just moved back to Ireland. He/She/they is mortgage free. They earn a high salary. The salary incorporates a good pension scheme. Should he/she/them pay extra into a pension scheme on top of this ?
If they can afford to and aren’t planning to use some of that extra money in the immediate future, they might as well if their pension isn’t maxed out.
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Age comes into it. If they have money lying around that is just sitting in a bank account I’d suggest they top up using AVCs. If you’re 40 - 49 you can put in anything up to 25% of your gross salary, 50 - 54 - 30%. For arguement sake if they elected to put in €500 per month of their salary they’d only be down a net €250 due to the tax relief. So all told it is a very efficient way of planning for the future.
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Any particular company youd advise to do these AVCs with?
Most rates are north of 3.75% at this stage. Still point taken. I guess it comes down to personal preference. i prefer being debt free where possible no matter what the rate. Maybe i need my head examined.
What does maxed out mean?
Great, sorry, I should have read this. Thanks.
I was like that, and haven’t regretted it tbh.
Those of us in the private sector can only accumulate a pension pot in the region of 2.1m before you start paying a supertax on it that I think is in the region of 68%. The rate isn’t really important because nobody ever pays it they just stop paying into the pension before that figure is hit hence the expression maxed out.
I believe they have something similar in the UK except the limit is much lower.
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It’s about 1.2 I think, I’m not sure. There’s other supertaxes as well, because they calculate the raise in value as part of the amount you’re allowed to put in or something.
Pay into the pension at max allowable tax relief levels…otherwise you are just handing over half of it unnecessarily to the revenue
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