What do i do with my Savings ???

Scalepro

Hi everyone.

I have a substantial amount of money saved (5 digit figure)and I am wondering what to do with it??? I don't want to get sucked into the housing Market ...(I think)as it is too unstable and I don't fancy a mortgage hanging over me for 33 years. I would like to put it into something that will see a good return with minimum risk (if that's even possible). Im hoping I can get a few good pointers here.

PS .. Please don't suggest crypto currency.....



Thanks

Taylor365

Scalepro wrote: »

good return with minimum risk

No such bet my friend.


good return = great risk


Great risk:
Stock market
P2P Lending
Mortgage
Commodities
Buy/Start a business


Min risk:
Prize bonds
Deposit account
Reg saver accounts
Upskill yourself

granturismo

You want low risk - post office schemes.

When do you want access to your part or all of your funds?

Scalepro

Thank you for your reply. I'll have to research p2p lending and commodities. I would love to start a business. But one where there is high demand for the service or product and good return on investment.
I would also consider upskilling but I want to see if the company I work for will pay for that first.

Taylor365 wrote: »

Scalepro wrote: »

good return with minimum risk

No such bet my friend.


good return = great risk


Great risk:
Stock market
P2P Lending
Mortgage
Commodities
Buy/Start a business


Min risk:
Prize bonds
Deposit account
Reg saver accounts
Upskill yourself

Scalepro

granturismo wrote: »

You want low risk - post office schemes.

When do you want access to your part or all of your funds?

I suppose in an ideal world it would be great to have access to some of my savings at all times for a rainy day fund but if it meant i would get a guaranteed return on securing the savings in i would seriously consider it.

Have you used these post office schemes yourself ?

granturismo

I have college money for my eldest that I'll need access to next year in prize bonds for the last 3 months, no wins yet. I'll have a second child starting college in 3 years and that money is half way through a state savings 5 year savings certificate.

I had these monies in various bank savings accounts over the years with little return. Its money I couldnt afford to take any risk with.

Scalepro

granturismo wrote: »

I have college money for my eldest that I'll need access to next year in prize bonds for the last 3 months, no wins yet. I'll have a second child starting college in 3 years and that money is half way through a state savings 5 year savings certificate.

So what's the story with the prize bonds. I presume the money( my savings)has to be locked into it for x amount of time or can I choose to take it out when i feel like it ?
Is the 5 year savings certificate a different scheme ? What's the return in the 5 year period ?

Thanks

Scalepro

granturismo wrote: »

I had these monies in various bank savings accounts over the years with little return. Its money I couldnt afford to take any risk with.

I hear ya . The thing is if I take a risk with this money and loose...I'm back to square 1 . I worked so hard for every penny and dont want to loose any of it.
Maybe I'll just put this Into something like the bonds and save up some more money which i could take a risk on .

PHG

Scalepro wrote: »

I hear ya . The thing is if I take a risk with this money and loose...I'm back to square 1 . I worked so hard for every penny and dont want to loose any of it.
Maybe I'll just put this Into something like the bonds and save up some more money which i could take a risk on .

Hi OP,

To be honest, you sound very risk averse. If you don't have a pension get on that. If you are looking at Bonds you are going to lose money anyway through inflation. There will have to be some risk... A mortgage is not a bad idea. But why take out a mortgage for 33 years. I personally believe any mortgage over 20years is not a wise choice and those who take out 30 year mortgages (they always say they will repay earlier and rarely do) are just not that smart.

If you have the makings of a 15% deposit on a property, an emergency fund of 3/6months living expenses separate and the other fess associated with a property (stamp duty, legal furnishing etc.) that is what I would do and am currently saving to do. Then again, I am just some guy at the end of a computer who could be talking pure sh*te!

Talk to a financial advisor as your best bet though and go from there!

Thanks,

PHG

granturismo

Scalepro wrote: »

So what's the story with the prize bonds. I presume the money( my savings)has to be locked into it for x amount of time or can I choose to take it out when i feel like it ?
Is the 5 year savings certificate a different scheme ? What's the return in the 5 year period ?

Thanks

https://www.statesavings.ie/our-products

Taylor365

Scalepro wrote: »

I hear ya . The thing is if I take a risk with this money and loose...I'm back to square 1 . I worked so hard for every penny and dont want to loose any of it.
Maybe I'll just put this Into something like the bonds and save up some more money which i could take a risk on .

Keep it tight and it won't become loose.

Scalepro

PHG ,
I agree, I am very risk averse but I come from a construction background so I've seen what can happen with peoples investments in pensions and property.
I would consider a 10/20 year loan from the credit union put with my savings to buy a property . They only do renovation loans where I'm from though so I would need a property in my name first. I need to find a way around that if I was to consider it .

Jim2007

Scalepro wrote: »

PHG ,
I agree, I am very risk averse but I come from a construction background so I've seen what can happen with peoples investments in pensions and property.
I would consider a 10/20 year loan from the credit union put with my savings to buy a property . They only do renovation loans where I'm from though so I would need a property in my name first. I need to find a way around that if I was to consider it .

You obviously have not learned very much from your construction background, then. There is a very good reason why Irish households lost more in wealth than any other EU country in the last recession - they broke every rule of investing:
- They invested in a high risk asset class
- They failed to diversify
- They borrowed to invest
And now you want to do the same thing on the eve of a new recession... I thought you were very risk averse

Taylor365

Scalepro wrote: »

I would consider a 10/20 year loan from the credit union put with my savings to buy a property .

What? Why?


Surely rates form the banks are A LOT better?

Lu Tze

PHG wrote: »

Hi OP,

To be honest, you sound very risk averse. If you don't have a pension get on that. If you are looking at Bonds you are going to lose money anyway through inflation. There will have to be some risk... A mortgage is not a bad idea. But why take out a mortgage for 33 years. I personally believe any mortgage over 20years is not a wise choice and those who take out 30 year mortgages (they always say they will repay earlier and rarely do) are just not that smart.

If you have the makings of a 15% deposit on a property, an emergency fund of 3/6months living expenses separate and the other fess associated with a property (stamp duty, legal furnishing etc.) that is what I would do and am currently saving to do. Then again, I am just some guy at the end of a computer who could be talking pure sh*te!

Talk to a financial advisor as your best bet though and go from there!

Thanks,

PHG

Just to be the exception to prove the rule, we took out a 32 year mortgage 4 years ago, now sowing as about 22 years left, should be clear of it in 10 years. We drop a lump every year, and have the lower monthly payment to fall back on, based on the 32 year mortgage, if things ever get tight.

Tiddlypeeps

Scalepro wrote: »

PHG ,
I agree, I am very risk averse but I come from a construction background so I've seen what can happen with peoples investments in pensions and property.
I would consider a 10/20 year loan from the credit union put with my savings to buy a property . They only do renovation loans where I'm from though so I would need a property in my name first. I need to find a way around that if I was to consider it .

Property always recovers, the markets always recover. For these things to no longer be true there would need to be a massive social, economic and political change. Even if that happens then cash isn't even safe.


Generally speaking the further out you think you will want/need the money the riskier you can be. If you are saving for retirement in 30 odd years then you can be fairly risky. Investing in property or ETF stocks over 30 years are actually pretty safe, as long as getting closer to retirement you start moving money out of those investments. The key is being able to wait it out when the markets are low.


If you know you will need the money in the short term then you should be very risk averse with it, otherwise it's better to take on some risk because without it you are essentially losing on average 2% of your money every year due to inflation.


So the biggest decision you need to make is what do you want the money for and when will you need it. And likely the answer isn't one thing, it's in the form of X amount in a few years to buy a house or start a family and Y amount in 30 years for retirement etc. So figure out what you think your major financial milestones will be, how much you think you will want for them and then go talk to a financial advisor and they will help you with the specifics of where to put your money with those goals in mind.

PHG

Lu Tze wrote: »

Just to be the exception to prove the rule, we took out a 32 year mortgage 4 years ago, now sowing as about 22 years left, should be clear of it in 10 years. We drop a lump every year, and have the lower monthly payment to fall back on, based on the 32 year mortgage, if things ever get tight.

I did say rarely , and you both are the rare few. Side question though, you drop a lump sum, is this savings/bonus each year or something like inheritance?

PHG

Tiddlypeeps wrote: »

Property always recovers, the markets always recover. For these things to no longer be true there would need to be a massive social, economic 11and political change. Even if that happens then cash isn't even safe.

This 100%. All markets have recovered since the crash. You buy the highs and the lows if you keep investing. I think S&P (may be wrong here, top of the head figure) has grown 7% year on year over the last 30 years, on average, even with the major dips. The worst thing people do is stop paying in when the market crashes and get back in when it is going up again. Plus the tax benefits from a pension are great.


Unfortunately OP, you have only noticed what has happened in a snapshot, not the bigger picture. Google any major Index over the last 30 years and you will see it is an upward trend. On a side note, fees can be a nightmare, watch out for the allocation rate!!

Jim2007

Tiddlypeeps wrote: »

Property always recovers, the markets always recover. For these things to no longer be true there would need to be a massive social, economic and political change. Even if that happens then cash isn't even safe

Only true if you ignore all the empirical evidence. Property in general may recover, you are not invested in property in general, you are invested in a particular property and that may or may not recover and even if it does it could take years to do so, in which case you have lost.

If you put more that say 6% or 7% of your wealth in property you should not be at all surprised that you suffer a significant loss.

antimatterx

PHG wrote: »

Scalepro wrote: »

I hear ya . The thing is if I take a risk with this money and loose...I'm back to square 1 . I worked so hard for every penny and dont want to loose any of it.
Maybe I'll just put this Into something like the bonds and save up some more money which i could take a risk on .

Hi OP,

To be honest, you sound very risk averse. If you don't have a pension get on that. If you are looking at Bonds you are going to lose money anyway through inflation. There will have to be some risk... A mortgage is not a bad idea. But why take out a mortgage for 33 years. I personally believe any mortgage over 20years is not a wise choice and those who take out 30 year mortgages (they always say they will repay earlier and rarely do) are just not that smart.

If you have the makings of a 15% deposit on a property, an emergency fund of 3/6months living expenses separate and the other fess associated with a property (stamp duty, legal furnishing etc.) that is what I would do and am currently saving to do. Then again, I am just some guy at the end of a computer who could be talking pure sh*te!

Talk to a financial advisor as your best bet though and go from there!

Thanks,

PHG

If you can lock in a low interest rate, get a mortgage for the maximum term allowed. You'll have smaller repayments, and you can use the excess money to invest in index funds, a pension ect and you'll be financially better off over the long term.

antimatterx

Tiddlypeeps wrote: »

Scalepro wrote: »

PHG ,
I agree, I am very risk averse but I come from a construction background so I've seen what can happen with peoples investments in pensions and property.
I would consider a 10/20 year loan from the credit union put with my savings to buy a property . They only do renovation loans where I'm from though so I would need a property in my name first. I need to find a way around that if I was to consider it .

Property always recovers, the markets always recover. For these things to no longer be true there would need to be a massive social, economic and political change. Even if that happens then cash isn't even safe.

Property hasn't recovered since the boom. While I think it's a fantastic investment, anyone who bought in 05/06 are down money.

Scalepro

Scalepro wrote: »

PHG ,
I agree, I am very risk averse but I come from a construction background so I've seen what can happen with peoples investments in pensions and property..................... .

BailMeOut

Pay a good independent financial adviser for 2-3 hours of time to put a plan together for you. I know an excellent one if you want a recomendation (PM me for details).

Scalepro

Taylor365 wrote: »

Scalepro wrote: »

I would consider a 10/20 year loan from the credit union put with my savings to buy a property .

What? Why?Surely rates form the banks are A LOT better?

So heres the thing Taylor365 and everyone..Aib would give me €140000 based on my current annual income and savings.The interest on that Is €88000 over a 33 year period. On top of that I would have to pay for them to get an engineer to sign off on it, take out mortgage insurance( Payed annually), I make that about €240000. They dont do mortgages for houses that are not in turn key condition eg( cant be signed off by engineer). Also they dont sell doer upper mortgages orrr.... the way I look at it ... they dont do affordable mortgages for AFFORDABLE houses. If you wanted to borrow say €30000 from Aib and put with your savings to buy an older more affordable house you would be looking at a personal loan . The interest on this is variable and its 9% right now . Credit union will do a renovation loan of €50000 @ 6% over 10 years. So with CU A) fixed rate 6%B) it's a ten year loan C) No engineering costs ( I'm a builder myself so I can do my own assessment of the property ) D) No monthly/annual morgtage insurance or other additional hidden costs that AIB will most certainly will have. I'd rather take my chances with a 10 year loan from CU for alot less money for a bog standard house which I can work on myself over the years. If the recession comes back in the next couple of years, at least I would only have to travel to work for 8 years or less. Makes sense in my world 🙂Now I need to figure out a way they will give me the renovation loan without actually owning a property yet ....🀔

Taylor365

Reminds me of listening to a hairdresser a good few years ago:

"We're saving in the credit union. If we save 50 grand, we can take out a loan 3 times that against our money and we won't need a mortgage."

Think the cu rate was 12% at the time....

Mike9832

Scalepro wrote: »

Hi everyone.

I have a substantial amount of money saved (5 digit figure)and I am wondering what to do with it??? I don't want to get sucked into the housing Market ...(I think)as it is too unstable and I don't fancy a mortgage hanging over me for 33 years. I would like to put it into something that will see a good return with minimum risk (if that's even possible). Im hoping I can get a few good pointers here.

PS .. Please don't suggest crypto currency.....



Thanks

I bought nickel recently

Only a few hundred euro worth but price has gone up 30% in the few months I have it, that €100,000 of yours would have went to €130,000

Been reading alot about electric car market and nickel is extremely important

Its going to be 90% of the materials of batteries soon and with all manufacturers moving to electric, demand is going to increase big time

Thinking of buying a few k worth in the next few days

https://markets.businessinsider.com/commodities/nickel-price

Scalepro

Scalepro wrote: »

..........I don't want to get sucked into the housing Market ...............

In a week you've seemingly sucked yourself in.

Scalepro wrote: »

................. So with CU A) fixed rate 6%B) it's a ten year loan C) No engineering costs ( I'm a builder myself so I can do my own assessment of the property ) D) No monthly/annual morgtage insurance or other additional hidden costs that AIB will most certainly will have. I'd rather take my chances with a 10 year loan from CU for alot less money for a bog standard house which I can work on myself over the years. If the recession comes back in the next couple of years, at least I would only have to travel to work for 8 years or less. Makes sense in my world ��Now I need to figure out a way they will give me the renovation loan without actually owning a property yet ....��

Scalepro

Just because I know what my options are doesn't mean I'm sucked in ...

Scalepro

Scalepro wrote: »

Just because I know what my options are doesn't mean I'm sucked in ...

So you won't be going near the housing Market with your wad of cash so.

Scalepro

Augeo wrote: »

Scalepro wrote: »

Just because I know what my options are doesn't mean I'm sucked in ...

So you won't be going near the housing Market with your wad of cash so.

I'm exploring all options across the board

Scalepro

Scalepro wrote: »

I'm exploring all options across the board

Scalepro

Augeo wrote: »

Well what would you suggest smartie pants ???

Scalepro

Taylor365 wrote: »

Reminds me of listening to a hairdresser a good few years ago:

"We're saving in the credit union. If we save 50 grand, we can take out a loan 3 times that against our money and we won't need a mortgage."

Think the cu rate was 12% at the time....

As I said, i dont want to go down the road of getting a mortgage. Small loan to buy a property (max 50000) I would consider but not a mortgage.

I just want to get some feedback to see what other people are doing with their savings.

Scalepro

Scalepro wrote: »

Well what would you suggest smartie pants ???

' like to put it into something that will see a good return with minimum risk ' ..... If the stock market for 10 years doesn't appeal then leave it in the post office.

Lu Tze

PHG wrote: »

I did say rarely , and you both are the rare few. Side question though, you drop a lump sum, is this savings/bonus each year or something like inheritance?

Only seeing this now, it's the previous years savings we drop, just save away, and if there aren't any large expenses in the foreseeable future we drop a chunk of it in, and start over.