1500 a month to save or invest

Paddy Dreadful

I can start to afford to save or invest 1500 euro every month, I have never invested before so don't have a clue about it, would appreciate some advice?

flended12

Save in credit union. If you haven't invested before leave well alone.

Jude13

Id be interested in this too, I have 'relationship manger' in Jeresey but they aren't exactly impartial as they are trying to sell me all HSBC products.

Irish_rat

Blue chip high dividend stocks with the likes of GE, AT&T are worth having and are generally the safest, at least if the market turns volatile you still have a guaranteed income. Might be worth keeping an eye on Walmart.

No point saving in a bank you're losing money straight away to inflation.

Amirani

flended12 wrote: »

Save in credit union. If you haven't invested before leave well alone.

If everyone followed this way of thinking, nobody would ever invest in anything.

I'd certainly say don't jump straight in, try saving a bit of money and reading some books on the topic. Read the FT at least once a week and keep and eye on market news. When it comes time to start, look at funds and diversified products. Some good information on this board.

Frogdog

I was in the same position, albeit with less resources, a few months ago. I've read a load of books since then and would highly recommend The Millionaire Teacher by Andrew Hallam, and anything else by him for that matter. I've recently opened up an account with Degiro and have bought my first ETF.

Sabre Man

What's your timeline for your investments?

lucky john

Frogdog wrote: »

I was in the same position, albeit with less resources, a few months ago. I've read a load of books since then and would highly recommend The Millionaire Teacher by Andrew Hallam, and anything else by him for that matter. I've recently opened up an account with Degiro and have bought my first ETF.

Have you researched the tax treatment of ETF's? if you are paying tax here in Ireland it's quite harsh.

topper_harley2

lucky john wrote: »

Have you researched the tax treatment of ETF's? if you are paying tax here in Ireland it's quite harsh.

Agreed. I have similar to OP to invest per month and had it all ready to go with etfs until I read up on tax. Now I don't know what to do. I want stock and bond market exposure but not by an expensive mutual fund. Any ideas? Or are etfs best option to out perform deposits using DIY even with tax disadvantages?

Fizman

topper_harley2 wrote: »

Agreed. I have similar to OP to invest per month and had it all ready to go with etfs until I read up on tax. Now I don't know what to do. I want stock and bond market exposure but not by an expensive mutual fund. Any ideas? Or are etfs best option to out perform deposits using DIY even with tax disadvantages?

At the start of this year I was in your shoes, with a similar amount of monthly income to put away as the OP.

After a lot of research on different financial platforms, I liked the idea of building my own DGI (Dividend Growth Stocks) portfolio and pretty much treat it as a savings account, but also my own self-directed pension fund for down the road.

Might be worth looking into for yourself. By purchasing one company per month, i'm essentially 'euro-cost-averaging', so i'm not rolling a huge ball of money into the market at any time, instead dripping it continuously in.

Check out blogs like Dividend Mantra and Dividend Growth Investor. From there you will find many others if interested.

Frogdog

Yes, I'm aware of the 8 year timeline and the tax implications with regards to ETFs. I'm of the belief that this will change between now and then however.

Phoebas

Paddy Dreadful wrote: »

I can start to afford to save or invest 1500 euro every month, I have never invested before so don't have a clue about it, would appreciate some advice?

Its a very vague question without information on what you're investing for, how long for, how liquid do you need it to be and what your attitude to risk is.

In the absence of any of that information, consider making/increasing pension contributions - not sexy, but often the most tax efficient investment out there.

Jude13

Ive no pension, hence wanting to invest. I am an expat at present paying no income tax.

Get yourself an online broker account and buy one individual share each month. Aim to build a basket of 10 to 12 shares in a year or so and after that to increase and fine tune your portfolio (don't exceed around 12 holdings). Read everything you can online about the shares you own and those that you might potentially buy.

To start, stick with blue chip dividend paying shares, the big guys - oil (good value atm), pharma, telecoms, consumer prioducts. Avoid low cap companies, funds, anything in newsletters, spreadbetting and 'trading'. Remember that shares go up as well as down and when they go down is the best time to buy.

Regard the first year as an education experience.

Tax on investments and savings in Ireland is crazy. The government should be trying to encourage wealth creation. Instead they hobble it by destroying the compounding effect on your assets (on which you have already paid tax). However, don't let tax avoidance direct your investment choices. After all you'll only pay tax if you make any profits...

Jude13

Jude13 wrote: »

Ive no pension, hence wanting to invest. I am an expat at present paying no income tax.

Ah, in that case you most certainly should invest. This is an opportunity not to be passed up. Get yourself an international online broker who can give you the forms so that the minimum withholding tax is collected on your dividends.
Also in your position you should consider which exchange to buy your shares. For example if you buy in London you pay stamp duty on the purchase, but you can buy the same shares in New York (in a form called ADRs) without that tax.
As this is a replacement for your pension, do not speculate. Stick to the categories I've mentioned in the above message and let compounding of the tax free dividends do its work.

Jude13

Cheers for the info. Any recommendations of an international online broker?

I haven't lived in Ireland for 7 years, in the middle east so not sure how tax on shares work. I don't trust any of the financial advisers out here.

Arbiter of Good Taste

OP get some good tax advice from someone who specialises in HNWI. There are a good few ex-Big 4 guys out there who have set up on their own, so you should be able to get the expertise without the exorbitant cost.

If you are living in the middle east and paying no tax, you are likely to end up suffering withholding tax at source - expect up to 20% tax leakage upfront. So, make sure you cost that into your return. You might find that it works out better to invest in low dividend yield shares with good capital growth prospects. Only you will know what works best for you. I have a good few high dividend yield shares as a result of employee share rewards. Dividends every six months. Each time I swear to reinvest my after tax return into different shares to diversify my portfolio. Unfortunately the cash always ends up covering the Xmas or summer holiday bills! :-)

I once heard that if you are looking for good capital growth go for shares in the major "sins" - tobacco, alcohol and armaments. :-)

Prezatch

Deleted User wrote: »

Aim to build a basket of 10 to 12 shares in a year or so and after that to increase and fine tune your portfolio (don't exceed around 12 holdings).

Why wouldn't you exceed 12?

topper_harley2

[Deleted User] wrote: »

Get yourself an online broker account and buy one individual share each month. Aim to build a basket of 10 to 12 shares in a year or so and after that to increase and fine tune your portfolio (don't exceed around 12 holdings). Read everything you can online about the shares you own and those that you might potentially buy.

To start, stick with blue chip dividend paying shares, the big guys - oil (good value atm), pharma, telecoms, consumer prioducts. Avoid low cap companies, funds, anything in newsletters, spreadbetting and 'trading'. Remember that shares go up as well as down and when they go down is the best time to buy.

Regard the first year as an education experience.

Tax on investments and savings in Ireland is crazy. The government should be trying to encourage wealth creation. Instead they hobble it by destroying the compounding effect on your assets (on which you have already paid tax). However, don't let tax avoidance direct your investment choices. After all you'll only pay tax if you make any profits...

I don't think individual stare picking is a good idea for a total novice. I'm similar to OP and acknowledge I have no idea what shares to buy. Also 12 shares is zero diversification as most people would buy companies they have heard of and hence are probably same geographical region and sector.

Compare 12 shares with MSCI world index which has 1500 shares from across the globe! Issue with this is the oenal tax regime.

topper_harley2

Frogdog wrote: »

Yes, I'm aware of the 8 year timeline and the tax implications with regards to ETFs. I'm of the belief that this will change between now and then however.

I wish! If not, then following applies. ... If I buy two chunks of same ETF, one at 100 and the second at 200.....then on the deemed disposal date tgeprice is 150, I can't offset 50 loss against 50 gain, meaning im even, and no net tax due. Ridiculous. This is how it works with shares etc.

Hence it seems very unfair to have to pay 41% tax on the 50 gain, meaning I've actually lost money overall.

topper_harley2

Fizman wrote: »

At the start of this year I was in your shoes, with a similar amount of monthly income to put away as the OP.

After a lot of research on different financial platforms, I liked the idea of building my own DGI (Dividend Growth Stocks) portfolio and pretty much treat it as a savings account, but also my own self-directed pension fund for down the road.

Might be worth looking into for yourself. By purchasing one company per month, i'm essentially 'euro-cost-averaging', so i'm not rolling a huge ball of money into the market at any time, instead dripping it continuously in.

Check out blogs like Dividend Mantra and Dividend Growth Investor. From there you will find many others if interested.

Euro cost averaging only works if you're buying same thing each time, and hence getting benefit of market ups and downs. In your case, since you're buying a different share each time, it's possible you'll always buy at high price since you are only buying that share once. I don't think that's a good strategy, you're basically timing the market on every single purchase.

Fizman

topper_harley2 wrote: »

Euro cost averaging only works if you're buying same thing each time, and hence getting benefit of market ups and downs. In your case, since you're buying a different share each time, it's possible you'll always buy at high price since you are only buying that share once. I don't think that's a good strategy, you're basically timing the market on every single purchase.

When did I mention that I was only buying that share once? I'd intend to add to positions in the future of stocks that I've already purchased.

I'm doing the complete opposite to timing the market. I'm purchasing an individual stock if close to fair value or cheaper at the point that capital becomes available to me.

My buy strategy involves making a shortlist of stocks that fit a certain criteria. I'd typically do this in the third week of the month. Then on payday, I'll reassess these and purchase whichever stock I think is fairest value.

E.g. I purchased Disney last month, and 2 weeks later it's up 11%.

I started purchasing in May on a monthly basis. The overall market is down roughly 15% since the highs of April / May, yet I've just checked my portfolio and it is up 2%.



Edit: Another example.......;

Allianz was my first and second purchase, so I effectively engaged in Euro cost averaging immediately (wasn't the plan but I was still getting my confidence up in terms of purchasing US stocks and having forex as another factor to consider).

I bought Allianz at €152, and again a few weeks later at €145. I now have an average value of €148.75 or thereabouts. Today it is at €150. If I just left it at my first purchase, my Allianz position would be currently -1.5% roughly. Instead it is +1.5% due to my second buy at €145.

Hope that clears up my what I'm up to!

topper_harley2

Fizman wrote: »

When did I mention that I was only buying that share once? I'd intend to add to positions in the future of stocks that I've already purchased.

I'm doing the complete opposite to timing the market. I'm purchasing an individual stock if close to fair value or cheaper at the point that capital becomes available to me.

My buy strategy involves making a shortlist of stocks that fit a certain criteria. I'd typically do this in the third week of the month. Then on payday, I'll reassess these and purchase whichever stock I think is fairest value.

E.g. I purchased Disney last month, and 2 weeks later it's up 11%.

I started purchasing in May on a monthly basis. The overall market is down roughly 15% since the highs of April / May, yet I've just checked my portfolio and it is up 2%.



Edit: Another example.......;

Allianz was my first and second purchase, so I effectively engaged in Euro cost averaging immediately (wasn't the plan but I was still getting my confidence up in terms of purchasing US stocks and having forex as another factor to consider).

I bought Allianz at €152, and again a few weeks later at €145. I now have an average value of €148.75 or thereabouts. Today it is at €150. If I just left it at my first purchase, my Allianz position would be currently -1.5% roughly. Instead it is +1.5% due to my second buy at €145.

Hope that clears up my what I'm up to!

When you said "one company a month" it sounded like once off buy. Didn't realise you were re-buying same companies, so apologies in that front. I wouldn't know how to judge what is "fair value" for any company however. Hence I don't like idea of buying individual stocks.

No offence, but 2% increase vs market decline of 15% can often be attributed to blind luck over such a short term of four months. Beating the market over 15 to 20 years us nigh on impossible. Riding the market wave itself is generally accepted as the way to long term returns.

Fizman

topper_harley2 wrote: »

When you said "one company a month" it sounded like once off buy. Didn't realise you were re-buying same companies, so apologies in that front. I wouldn't know how to judge what is "fair value" for any company however. Hence I don't like idea of buying individual stocks.

No offence, but 2% increase vs market decline of 15% can often be attributed to blind luck over such a short term of four months. Beating the market over 15 to 20 years us nigh on impossible. Riding the market wave itself is generally accepted as the way to long term returns.

I'm fully aware of the luck element. I wasn't putting those figures out there in an boastful manner of saying how much of a market genius I am, moreso to highlight that the fact that I have made 5 individual purchases over the last 5 months, compared to a lump sum 5 months ago, has had a positive effect on my overall balance.

I don't intend to beat the market. That's not in my strategy. I purchase dividend paying blue chip (or if not blue chip - very high cap) stocks that I don't ever intend to sell. That alone with some diversification should see me ride the market wave over the long term as you state.

Each dividend payment will then get reinvested along with freshly available capital. So even in times of bear markets, I will expect income from my selections and not be overly concerned about the value of my overall portfolio. If anything, DGI investors love when markets dip as they get great companies at discounted prices.

Again, I'm in my first year of this so very much my educational period, so I'm far far from an expert. But I'm enjoying it a lot so far.

topper_harley2

Ditto re: being new. I've made five buys as well this year, all etfs, cost averaging, same as yourself. The tax issue has kinda made me second guess a lot, even though tax regime may have changed twice over before first 8 year deemed disposal. I just don't have time or inclination of knowledge to do your approach.

etoughguy

askaboutmoney.com has loads of threads along the lines of the OPs query might be worth starting there

beware of "experts" they are everywhere!

Prezatch

topper_harley2 wrote: »

I wish! If not, then following applies. ... If I buy two chunks of same ETF, one at 100 and the second at 200.....then on the deemed disposal date tgeprice is 150, I can't offset 50 loss against 50 gain, meaning im even, and no net tax due. Ridiculous. This is how it works with shares etc.

Hence it seems very unfair to have to pay 41% tax on the 50 gain, meaning I've actually lost money overall.

This is incorrect - you will not lose money overall with an ETF. You have the choice of either FIFO or average cost basis. Say you bought 50 shares of the ETF at 100 and 50 at 200 then sold the lot in one transaction for 150. Your average cost would be 150 meaning no gain/loss therefore no tax.

If however if you sold your first 50 and made a gain, then went and sold your second 50 making a loss in a separate transaction the next day say, then you get screwed on tax as you cannot offset losses. So you have to be careful...

topper_harley2

topper_harley2 wrote: »

I don't think individual stare picking is a good idea for a total novice. I'm similar to OP and acknowledge I have no idea what shares to buy. Also 12 shares is zero diversification as most people .

I didnt say pick 12 shares at random. I said:
" stick with blue chip dividend paying shares, the big guys - oil (good value atm), pharma, telecoms, consumer prioducts. Avoid low cap companies, funds, anything in newsletters, spreadbetting and 'trading'."

12 shares is enough diversification if distributed amoung the various sectors. Thes big blue chip companies are generally multinationals so that in itself brings diversification.
12 holdings is also a number which is possible to follow in terms of keeping up with the news.. remember you must also spend time following other sectors too.
More than 12 or 15 and you end up trying to run a fund...

Jude13

Jude13 wrote: »

Cheers for the info. Any recommendations of an international online broker?

I haven't lived in Ireland for 7 years, in the middle east so not sure how tax on shares work. I don't trust any of the financial advisers out here.

Try TD International in Luxembourg.

If you are genuinely out of Ireland for 7 years, your shares will not be taxed in Ireland, so the only issue is the tax regime in your country of residence. Youre the best person here to know that.

topper_harley2

JoeyD wrote: »

This is incorrect - you will not lose money overall with an ETF. You have the choice of either FIFO or average cost basis. Say you bought 50 shares of the ETF at 100 and 50 at 200 then sold the lot in one transaction for 150. Your average cost would be 150 meaning no gain/loss therefore no tax.

If however if you sold your first 50 and made a gain, then went and sold your second 50 making a loss in a separate transaction the next day say, then you get screwed on tax as you cannot offset losses. So you have to be careful...

Just when I thought I had etf tax somewhat figured out! So for eight year disposal you average the cost of buying the 12 individual instalments and pay tax on overall gain relative to this. ...why would anyone use FIFO approach then? Do they allow averaging across 2+ funds or is averaging on per fund basis? Form 11 only has one area for etf tax so looks like you can lump all into one

Prezatch

topper_harley2 wrote: »

Just when I thought I had etf tax somewhat figured out! So for eight year disposal you average the cost of buying the 12 individual instalments and pay tax on overall gain relative to this. ...why would anyone use FIFO approach then? Do they allow averaging across 2+ funds or is averaging on per fund basis? Form 11 only has one area for etf tax so looks like you can lump all into one

Well I'm no expert but I would have thought you have to treat each ETF separately. Averaging across more than 1 defeats the purpose of the rule for not allowing offsetting losses. So using separate calculations for each ETF which average out the 'buy' price over the years, ignore those ETFs which show an overall loss and aggregate the tax charges on those that show gains into one figure for your Form 11.

I haven't done the maths but there may be some instances when FIFO is more advantageous to investors from a tax perspective.

topper_harley2

JoeyD wrote: »

Well I'm no expert but I would have thought you have to treat each ETF separately. Averaging across more than 1 defeats the purpose of the rule for not allowing offsetting losses. So using separate calculations for each ETF which average out the 'buy' price over the years, ignore those ETFs which show an overall loss and aggregate the tax charges on those that show gains into one figure for your Form 11.

I haven't done the maths but there may be some instances when FIFO is more advantageous to investors from a tax perspective.

Thanks for that. Gives a bit more hope to me to continue with my ETF plan anyway. Averaging makes tax sound less penal than my original example that you refuted. Think I'll continue as I am then, three etfs, covering world equity, just euro equity and euro bond. Maybe in 8 years tax will have changed again!

27cyrix

I invest about 500e twice a month. I buy more when market goes down. otherwise i invest in P2P lending.

This is my portfoilo(google sheets)
https://docs.google.com/spreadsheets/d/1h89VR-HrcboCa2xG7ZuWe-BPnmcOefBIhR46vzUZJIg/edit?usp=sharing

clickerquicklic

JoeyD wrote: »

This is incorrect - you will not lose money overall with an ETF. You have the choice of either FIFO or average cost basis. Say you bought 50 shares of the ETF at 100 and 50 at 200 then sold the lot in one transaction for 150. Your average cost would be 150 meaning no gain/loss therefore no tax.

If however if you sold your first 50 and made a gain, then went and sold your second 50 making a loss in a separate transaction the next day say, then you get screwed on tax as you cannot offset losses. So you have to be careful...

You are actually incorrect each purchase of an ETF is treated as a distinct purchase I rang revenue on this and emailed for full clarification it's grossly unfair but I gave a similar example if I buy at 100 and 200 and sell at 150 you IGNORE the loss ( you only can use averaging on the profitable ETFs) and you pay exit tax on the winners. A losing ETF is treated as 0 for calculator purposes , Susan is a great help at revenue.ie , try buy all your ETFs as one lump sum as buying at differnt prices could be very costly.

I hope this rule be changed as its grossly unfair I believe within 8 years it will be but currently the rule above is correct.

Prezatch

clickerquicklic wrote: »

You are actually incorrect each purchase of an ETF is treated as a distinct purchase I rang revenue on this and emailed for full clarification it's grossly unfair but I gave a similar example if I buy at 100 and 200 and sell at 150 you IGNORE the loss ( you only can use averaging on the profitable ETFs) and you pay exit tax on the winners. A losing ETF is treated as 0 for calculator purposes , Susan is a great help at revenue.ie , try buy all your ETFs as one lump sum as buying at differnt prices could be very costly.

I hope this rule be changed as its grossly unfair I believe within 8 years it will be but currently the rule above is correct.

:eek::eek: Yikes!! I stand corrected so, thanks for the info.

That's absolute BS really. I'd say most people who are using ETFs and calculating tax due for their return are probably doing it incorrectly so as there is so little guidance published on the matter.

I hope to exit my ETF positions as soon as they reach breakeven (took a hit during the Greek/China crisis in the last few months) and just use the funds for shares across a decent range of companies and industries instead as the tax treatment is simply too harsh on ETFs. Even if they lower the exit tax rate in the next few years, not being able to offset losses is a killer.

lucky john

clickerquicklic wrote: »

You are actually incorrect each purchase of an ETF is treated as a distinct purchase I rang revenue on this and emailed for full clarification it's grossly unfair but I gave a similar example if I buy at 100 and 200 and sell at 150 you IGNORE the loss ( you only can use averaging on the profitable ETFs) and you pay exit tax on the winners. A losing ETF is treated as 0 for calculator purposes , Susan is a great help at revenue.ie , try buy all your ETFs as one lump sum as buying at differnt prices could be very costly.

I hope this rule be changed as its grossly unfair I believe within 8 years it will be but currently the rule above is correct.

Correct. from a tax payer in Ireland's point of view there is very little incentive in buying ETF's. buying funds monthly is especially a pain and would require a very good spreadsheet to keep track of future liabilities. You were very lucky to find Susan as very few in revenue are on top of their own rules.

One interesting point though is that Michael Noonan is fond of investing in EFT's. You would hope he would realise how mad the rules are and fix them.

clickerquicklic

I put about 200k into ETF's as the base of my portfolio , this is total stock market ETF , now I am topping up every few months by buying individual shares , I am trying to diversify as best I can 10k into a different sector each quarter. Ireland do not make it easy for investors for sure , I do whoever think ETF's can play at part in a portfolio .

topper_harley2

So my original example was correct! Back to not knowing what to do now. Buying say 50k ETF in single purchase is not very appealing to me. Would much prefer monthly contributions. Is it possible to begin lobbying somehow to get this changed as it's total nonsense add it is.

I would hazard a guess many people are using losers to offset tax on winners anyways, either through lack of knowledge or "other reasons". With self assessment is assumed the person submitting returns has it correct.

topper_harley2

clickerquicklic wrote: »

I put about 200k into ETF's as the base of my portfolio , this is total stock market ETF , now I am topping up every few months by buying individual shares , I am trying to diversify as best I can 10k into a different sector each quarter. Ireland do not make it easy for investors for sure , I do whoever think ETF's can play at part in a portfolio .

There's little other option for someone who wants to use index funds, without using expensive Life companies like Zurich etc

etoughguy

Interesting thread with some great answers

What do people think of Solidarity bonds for 10 years giving 25% interest?

http://www.statesavings.ie/Downloads/Brochure3.PDF

pwurple

etoughguy wrote: »

Interesting thread with some great answers

What do people think of Solidarity bonds for 10 years giving 25% interest?

http://www.statesavings.ie/Downloads/Brochure3.PDF

I think the interest rate is too low.

etoughguy

pwurple wrote: »

I think the interest rate is too low.

Cheers, I can see where you are coming from. A yield of 25% over 10 years might be ideal for a newbie regular saver but alot less than the stock market alright

topper_harley2

clickerquicklic wrote: »

I put about 200k into ETF's as the base of my portfolio , this is total stock market ETF , now I am topping up every few months by buying individual shares , I am trying to diversify as best I can 10k into a different sector each quarter. Ireland do not make it easy for investors for sure , I do whoever think ETF's can play at part in a portfolio .

What about doing single ETF purchase per yer, thereby only having single buy for eight year rule, and its either profitable and hence taxable or else a lose and not taxable. You'd obviously lose out a bit on DCA average price across the year, but tax would be easier. Then when actually selling, wait until they're all in profit so you pay tax fairly on all of them? This would only work per single ETF, but could be an idea. .....any thoughts?

topper_harley2

etoughguy wrote: »

Cheers, I can see where you are coming from. A yield of 25% over 10 years might be ideal for a newbie regular saver but alot less than the stock market alright

Plus inflation could be increasing over next ten years and you're locked in at that rate

pwurple

etoughguy wrote: »

Cheers, I can see where you are coming from. A yield of 25% over 10 years might be ideal for a newbie regular saver but alot less than the stock market alright

Even for a newbie regular saver it's low.

A lot of savings accounts on the market offer more than that, with less rigmarole around withdrawal.

etoughguy

Frogdog wrote: »

I was in the same position, albeit with less resources, a few months ago. I've read a load of books since then and would highly recommend The Millionaire Teacher by Andrew Hallam, and anything else by him for that matter. I've recently opened up an account with Degiro and have bought my first ETF.

reading that book now cheers for the pointer

Do you mind me asking the name of the EFT on that site? Just looking around for the first time
Thanks

Prezatch

For example, the EURO Stoxx 50 is up by 2.3% so far today.... so put that into context with your bond yield example which gives 2.5% annualised.

etoughguy

JoeyD wrote: »

For example, the EURO Stoxx 50 is up by 2.3% so far today.... so put that into context with your bond yield example which gives 2.5% annualised.

Cheers (I don't mean to hijack the thread). Like the OP I'm new to the whole ETFs etc and this thread has been a great place to start

Frogdog

etoughguy wrote: »

reading that book now cheers for the pointer

Do you mind me asking the name of the EFT on that site? Just looking around for the first time
Thanks

The ETF I bought? It's an Ossiam European Equity Equally Weighted STOXX 600. Might not be for everyone though......

clickerquicklic

topper_harley2 wrote: »

What about doing single ETF purchase per yer, thereby only having single buy for eight year rule, and its either profitable and hence taxable or else a lose and not taxable. You'd obviously lose out a bit on DCA average price across the year, but tax would be easier. Then when actually selling, wait until they're all in profit so you pay tax fairly on all of them? This would only work per single ETF, but could be an idea. .....any thoughts?

If you buy an ETF every week in year 1 after 8 years you can total up all your gains and pay tax on year 9 , you don not have to wait till exactly 8 years for each disposal all purchases made in same year can be totalled I have confirmed this with revenue.

There are investment trusts that trade in sterling on the London exchange that offer the same diversification as ETF,s some of them have very low TER's and are around a long time , they are taxed like shares and loss relief is available. There's a website that compares all these AIC is the site , you can buy trusts at a discount to NAV which may appeal . They offer a viable alternative to ETF's. Check out foreign and colonial or Bankers for example .

One thing to remember is you are getting loss relief in an ETF itself , there are thousands of companies that make up as MSCI world , so your getting a lot of loss relief , tbh I think ETF's are still the best , the TER combines with the accumulated dividends makes them very appealing , your dividends get to grow tax free until year 8 , I don't believe in dollar cost averaging any more "time in market is always better than timing the market " put the money in and forget it till your retiring or need it for whatever.
at the moment I have 200~k as a base for portfolio , I downloaded the MSCI world holdings and am buying individual shares now the largest holding in each sub sector in that fund I'm buying individually so eventually I'll hold similar stock outside a find myself if that makes sense.

topper_harley2

clickerquicklic wrote: »

If you buy an ETF every week in year 1 after 8 years you can total up all your gains and pay tax on year 9 , you don not have to wait till exactly 8 years for each disposal all purchases made in same year can be totalled I have confirmed this with revenue.

There are investment trusts that trade in sterling on the London exchange that offer the same diversification as ETF,s some of them have very low TER's and are around a long time , they are taxed like shares and loss relief is available. There's a website that compares all these AIC is the site , you can buy trusts at a discount to NAV which may appeal . They offer a viable alternative to ETF's. Check out foreign and colonial or Bankers for example .

One thing to remember is you are getting loss relief in an ETF itself , there are thousands of companies that make up as MSCI world , so your getting a lot of loss relief , tbh I think ETF's are still the best , the TER combines with the accumulated dividends makes them very appealing , your dividends get to grow tax free until year 8 , I don't believe in dollar cost averaging any more "time in market is always better than timing the market " put the money in and forget it till your retiring or need it for whatever.
at the moment I have 200~k as a base for portfolio , I downloaded the MSCI world holdings and am buying individual shares now the largest holding in each sub sector in that fund I'm buying individually so eventually I'll hold similar stock outside a find myself if that makes sense.

Thanks for that, I haven't really considered trusts as I don't understand them, since I haven't read up. Similarly to your point, I'd prefer to stick with ETF if possible. I have made some initial contact with an advisor about converting UCITS ETFs into non-UCITS for tax at CGT Etc. Apparently it can be done using Canadian domiciled ETFs they are treated as CGT. Will see how that goes. Not 100% happy about using advisor but if he can fenagle lower tax then may be worth it