What's going to happen to the ordinary Joe Soap?

dubh laoch

Hi all,


As the question illustrates, I'm no economic authority. I am just wondering if Greece defaults and subsequently Ireland goes the same route what's going to happen the ordinary Irish person on the street.

I'm currently working abroad so I'm only catching up on bits and pieces here and there by listening to Irish radio on the internet or reading the Irish Times website. Things are sounding pretty gloomy so I'm worried for my family back home.

I was recently (last week I think) listening to the Eamonn Dunphy show on newstalk where one of the panelists was suggesting Irish people should be considering moving their savings out of Ireland.

My mam has no one to advise her on financial matters so I want to be able to let her know whether she should keep her savings in Ireland or move them to another country.

Maybe I'm mad for even worrying about it but I'd prefer to hear from some of you guys who have a better grasp of the subject area as to what might transpire in the worst case scenario. Better to be safe than sorry.

Much obliged,

dubh laoch

tenchi-fan

Basically.. the people picking up the pieces are the Irish taxpayers. Limited companies come and go.. but bankruptcy laws mean Irish people will be stuck with their debts forever (even the proposed 5 years is too long considering the circumstances). The only euro-denominated cash that is certain is your mortgage and loans.

So, yes, your money is a lot safer outside Ireland than in Irish banks. I used to laugh at old people such as my granny for not trusting the banks or government.. but I'm from a generation that will never trust any Irish government or bank again for as long as I live - least of all the FG bastards who think they are going to sail through their first term by blaming all our current woes on the FF bastards.. they're all the same. Even as the main opposition party we heard FG usually bleating that FF "didn't go far enough" and making the usual promises made by desperate liars trying to get into power for their own financial and egotistical reasons. Let's not forget that FG are raiding private retirement savings funds by 2.4% of the fund value, as well as charging premium levies on all investment savings, pension savings and life assurance policies. If they get really desperate they will also nationalise private retirement savings funds and "invest" the money in infrastructure such as new roads, solar panels and broadband. Your money is NOT 100% anywhere.. in Ireland it's even less safe.

And as for banks.. I know someone who went into BOI and didn't want to invest. The BOI manager ADVISED her to put all her money (approx €200k) in a BOI term deposit. Crazy!

I'm not trying to be sensationalist, as the chance of you losing your deposits in Irish banks is pretty slim. You also only have to pay DIRT rather than income tax on interest on your savings in Ireland. Still, if security is a priority for you you should diversify. Have your money in several currencies, in several banks, in several geographic locations. And don't forget how inflation can ravage your savings.. so try to invest in government bonds, commodities, property and equities if you have considerable savings.

later12

OP be careful of what kind of advice you take seriously from the internet.

Personal finance, as it says on the tin, is a very personal matter and unwise decisions can have tremendously disruptive personal consequences. I wouldn 't take financial advice from anybody without being aware of their credentials any more than I would take medical advice from anyone without a medical background. Bearing in mind that internet forums - espeically political forums - can sometimes exaggerate or sensationalise events, I would take any such advice on here with a pinch of salt.

If I were in your position I would have my mother go and talk to a professional financial adviser, and also to a friend of the family who can help her process and weigh up his or her profesional perspectives. You don 't want to be giving someone you care about financial advice from an internet forum.

dan_d

A brief answer to your question OP (coz I'm on a crap phone).

Don't put all your eggs in one basket.Be wary of financial advisers who advise you to invest everything in one place...as with every profession there tends to be 'in' or 'hot' things to do at any one time, and these can be pushed on a consumer without any real thought of the consequences.

My attitude (I'm 28) to banks has always been that Wall Street happened, and can ALWAYS happen again.Always.I view them with suspicion.I've no idea where that came from in me, but it's there.I use them...but carefully.

Realistically I do not think anything much is going to happen to the ordinary joe soap.We have a very young population, a baby boom since 07 and we are dealing with our problems.To quote Noonan...we are not Greece. And it's true.

Always exercise caution with your money, regardless of the economic state of the country.

tenchi-fan

dan_d wrote: »

To quote Noonan...we are not Greece. And it's true.

We're not Greece. Greece is an animal.. we're worms. we slither under the radar. Low capital gains tax. Transfer pricing. Reliance on foreign direct investment in the financial service sector. Our economy is based on real tax on paper profits. It's nothing to be proud of.

But I'll +1 when you say "Be wary of financial advisers". Most of them either get paid directly from life companies or get huge commissions from them. There is nothing attractive about a 5% entry fee PLUS 1% (or possible 2%, not really up-to-date) levy on investment products PLUS fund management charge, or a government levy of 2.4% on retirement savings products, or an exit charge of up to 5%, or a bid-offer spread, or a 6-month moratorium to exit certain funds... or a levy on insurance products... or a 28% exit tax on profits even though losses on life assurance products cannot be offset against losses!! My God! I'll let you in on a secret.. financial advisers in banks are salesmen. Even the exams that accredit them are multiple choice questions. I did three out of 6 exams (5 of which are multiple choice). They require approx 2 weeks study to ace them. A trained monkey could pass them. Do not trust "financial advisers" unless you can be sure of their credentials... hint: the suffix QFA or the fact they are employed by a financial services company more work against them than for them!

later12

Obviously the QFA is a very basic qualification and does not equip someone to hand down financial advice. The new CFPs are a welcome entry in that regard.

Anyway, the OP need not necessarily ask a bank for their advice, although I struggle to be convinced that taking advice from faceless posters an internet forum - and a political forum at that - is any better.

amacachi

Remember that some peoples' idea of diversifying investments was to invest in property and to invest in banks which were providing loans for property. :pac:

beeftotheheels

While I would second Later10s position of being very wary of taking advice off people on the internet I think it is fair to say that we are acutely aware that almost all investments carry a risk these days, including putting a few bob in the post office, or indeed removing your cash and putting it under the mattress.

http://www.irishtimes.com/newspaper/ireland/2011/0628/1224299680486.html

What I have said to my parents is that, given they are worried about the risks of keeping their money anywhere, now might be the time to spend some of it.

Not blowing it for the sake of blowing it, but thinking about the things that they always wanted and were too prudent to buy.

So instead of spending €400 on a particular device which they're going to buy anyway, why not look at spending €1,500 on the top of the range one that they really want (this is a piece of farm equipment, not a luxury handbag by the way).

Being prudent is only good if the prudence itself will pay off, and while one would hope that it will, the logic of putting off buying things to tomorrow while having savings today may have shifted slightly.

Rubik.

dubh laoch wrote: »

I was recently (last week I think) listening to the Eamonn Dunphy show on newstalk where one of the panelists was suggesting Irish people should be considering moving their savings out of Ireland.

Was it someone connected to Declan Ganley's new company, St Columbanus? The company was set up to help clients move their savings into Swiss bank accounts. If so, maybe that panelists opinion was a bit biased.

Inverse to the power of one!

later10 wrote: »

Obviously the QFA is a very basic qualification and does not equip someone to hand down financial advice. The new CFPs are a welcome entry in that regard.

Anyway, the OP need not necessarily ask a bank for their advice, although I struggle to be convinced that taking advice from faceless posters an internet forum - and a political forum at that - is any better.

In absolute agreement with you....but alas there's no harbor in the so called experts either as they are merely sails in the economic winds. In this day and age, you can only research your own finances, and even then......there's so much you'll miss on a lack of experience.

No ideal solution I'm afraid.

Maybe a compromise would be to use the web to find a good adviser with an actual reputation worth more then letters after the name.

MrJoeSoap

What will happen to me???

Gareth2011

RichardAnd wrote: »

OP, your question is very difficult to answer because there really isn't such a thing as the ordinary Joe Soap. If Greece defaults, it could be the ruination of many people but a brilliant opportunity for others. It all depends on a person's personal situation, their own ingenuity, assets and lady luck. With so many variables, it's difficult to come down to a common denominator.

I personally do not think Greece will be allowed to default in the fullest sense of the word. It's likely that if they are beyond the point of no return, the EU will come up with some sort of mechanism to cut them off from the system without too much damage. Severing a gangrenous limb so to speak.

Yeah there saying now the greek debt could be more than they thought like 3 or 4 times the amount they thought. I'm sick of this at this stage tho. The Irish public gets screwed every year cause of the IMF and the EU. I know we have the get deficite down etc etc but look at this year fopr instance. We get a good report from trokia, we are doing good, country is getting back on its feet slowly. Ireland gets 2 interest rate cuts savings it millions every year and yet noonan is told to go above the 3.6bn so make sure everything is ok? Ireland has money they just use it for the wrong things like giving Billions to bailing out the banks who in return wont help out struggling customers and the f**ks still give there ceo's hefty bonu's and big wages packets. for what? they dont make any decisions that help people, bar the few like ptsb who In my opinion are the best when it comes to helping and understanding peoples situtation. Going after the little people when 5 fingers fingleton is let off and developers who transferred all there **** into the wifes name. pisses me off to no end i tell ya.:mad:

FreudianSlippers

Ireland is very different to Greece. There are various things that are incorrect about your post, but mainly I'm not sure exactly what the connection is here between Greek debt and Irish issues.

Gareth2011

There is no connection I just wanted to rant. If I had the money Id be gone from this Island we call home. Crap hole it is.

JimiTime

Gareth2011 wrote: »

they dont make any decisions that help people, bar the few like ptsb who In my opinion are the best when it comes to helping and understanding peoples situtation. Going after the little people when 5 fingers fingleton is let off and developers who transferred all there **** into the wifes name. pisses me off to no end i tell ya.:mad:

Could you elaborate on this? They're certainly screwing Variable rate mortgage holders at the moment, so I'm interested in the experience you seem to have with them? I may have to go to them in the next year, so what makes you say the above? Genuine question, as I'd like to know what to expect.
Cheers.

Gareth2011

JimiTime wrote: »

Could you elaborate on this? They're certainly screwing Variable rate mortgage holders at the moment, so I'm interested in the experience you seem to have with them? I may have to go to them in the next year, so what makes you say the above? Genuine question, as I'd like to know what to expect.
Cheers.

Well you see the thing is I took out my mortgage back in 2006 with ptsb and i got a tracker. I'm sure you know banks don't do the tracker's anymore. I have been struggling with my mortgage on and off since 2007 when I became unemployed originally and have been in and out of jobs since. They have always been understanding of my situtation and they are one of 3 banks (i think) that have implemented the "deffered interest option" for struggling home owners. It is true they are one of the banks that nail variable rate mortgage holders but all the banks are cause there not making the money from tracker's. But like all bank's they will only take so much when people cant pay but they will help you as much as they can say more than aib or boi.

JimiTime

Gareth2011 wrote: »

Well you see the thing is I took out my mortgage back in 2006 with ptsb and i got a tracker. I'm sure you know banks don't do the tracker's anymore. I have been struggling with my mortgage on and off since 2007 when I became unemployed originally and have been in and out of jobs since. They have always been understanding of my situtation and they are one of 3 banks (i think) that have implemented the "deffered interest option" for struggling home owners. It is true they are one of the banks that nail variable rate mortgage holders but all the banks are cause there not making the money from tracker's. But like all bank's they will only take so much when people cant pay but they will help you as much as they can say more than aib or boi.

Appreciate the response. Alas, its not what I had hoped for though:( Just to let you know though, BOI or AIB, are not nailing Variable holders like PTSB. They are still charging 3. something percent, while PTSB, are riding us for a whopping 6.19%!!!!

hatrickpatrick

You know the pecking order. Those responsible for the disaster, in the banking and political sector, will be called on to contribute only after the purses of every old age pensioner, sick child, and hard working citizen have been utterly emptied to pay for the mistakes and wrongdoing of others.

When we're all starving under Famine II, when there is literally not a single cent more for them to steal from us - that's when they'll have to finally face the music themselves.

Head The Wall

hatrickpatrick wrote: »

Those responsible for the disaster, in the banking and political sector, will be called on to contribute only after the purses of every old age pensioner, sick child, and hard working citizen have been utterly emptied to pay for the mistakes and wrongdoing of others.

I'm not aware of too many OAP's that have had their purses emptied, you're coming out with a lot of mistruths :pac: They appear to be the ones that have been pretty much entirely unaffected

hatrickpatrick

Head The Wall wrote: »

I'm not aware of too many OAP's that have had their purses emptied, you're coming out with a lot of mistruths :pac: They appear to be the ones that have been pretty much entirely unaffected

We've a long way to go yet. If it's a choice between burning old age pensioners and burning speculators, I'll bet you €50 I know who it'll be.

The medical card was one of the first things the last government attempted to screw with when the **** hit the fan, if you remember. They buckled under the strength of the protest against it, but it shows the priorities of the political class. "Bleed absolutely everyone else dry before even thinking about touching us and our friends."

Donal Og O Baelach

hatrickpatrick wrote: »

We've a long way to go yet. If it's a choice between burning old age pensioners and burning speculators, I'll bet you €50 I know who it'll be.

The medical card was one of the first things the last government attempted to screw with when the **** hit the fan, if you remember. They buckled under the strength of the protest against it, but it shows the priorities of the political class. "Bleed absolutely everyone else dry before even thinking about touching us and our friends."

Plus the fact that any new Govt can point to the bogey men in the IMF & EU when the blue rinse brigade come to surround the Dail.
"It was them made me do it Ma."

Head The Wall

hatrickpatrick wrote: »

We've a long way to go yet. If it's a choice between burning old age pensioners and burning speculators, I'll bet you €50 I know who it'll be.

The medical card was one of the first things the last government attempted to screw with when the **** hit the fan, if you remember. They buckled under the strength of the protest against it, but it shows the priorities of the political class. "Bleed absolutely everyone else dry before even thinking about touching us and our friends."

Why quote my post if you are not going to respond to it. You're just backtracking now on your lie

Maura74

Head The Wall wrote: »

I'm not aware of too many OAP's that have had their purses emptied, you're coming out with a lot of mistruths :pac: They appear to be the ones that have been pretty much entirely unaffected

There is a lot OAP's that are poor just scraping by with what they got and there again there is a lot of very wealthy OAP that are still in receipt of state pensions as well as personal pensions and ex politicians as well I am sure it must be about 50% of these pensioners. Of course there is Bertie that is being paid 100 of thousands pounds by the tax payer to keep his empire going.

When do the very rich pensioners start paying tax on their income or is it free for them.

catbear

Give me your money. You can forget about it then and get a good sleep.