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2 year 10k investment

  • 22-09-2020 11:51am
    #1
    Registered Users Posts: 72 ✭✭ oreo47


    Hi
    I am currently going into second year of college.
    I have been left 10k by a kind uncle.
    I have also been told by my parents I will have to pay for fees and living expenses in 4th of college. I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks


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Comments

  • Registered Users Posts: 3,030 ✭✭✭ Browney7


    oreo47 wrote: »
    Hi
    I am currently going into second year of college.
    I have been left 10k by a kind uncle.
    I have also been told by my parents I will have to pay for fees and living expenses in 4th of college. I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks

    Seems like capital preservation is your number one priority for this money so a bank deposit or prize bonds is the only realistic option in my opinion.


  • Closed Accounts Posts: 170 ✭✭ DilD


    Browney7 wrote: »
    Seems like capital preservation is your number one priority for this money so a bank deposit or prize bonds is the only realistic option in my opinion.

    Agreed. If you will need it in 2 years then investing it may not work out for you in that timeframe. Market may reward you between here and then but that's not to say we won't be in a serious correction when it comes time for you to withdraw your funds.


  • Registered Users Posts: 72 ✭✭ oreo47


    so it best to just do nothing with it?


  • Registered Users Posts: 15,807 ✭✭✭✭ Mantis Toboggan


    oreo47 wrote: »
    so it best to just do nothing with it?

    Prize bonds


    IRISHMEN AND IRISHWOMEN: "In the name of God and of the dead generations from which she receives her old tradition of nationhood, Ireland, through us, summons her children to her flag and strikes for her freedom"

    Irish Proclamation



  • Registered Users Posts: 2,649 ✭✭✭ cooperguy


    Prize bonds

    Came to say the same thing. You dont get a (safe) return in two years. Buy prize bonds, you'll keep your money safe and maybe you win big!


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  • Registered Users Posts: 4,198 ✭✭✭ An Ri rua


    Browney7 wrote: »
    Seems like capital preservation is your number one priority for this money so a bank deposit or prize bonds is the only realistic option in my opinion.

    Condolences on your uncle. A wonderful gift and life-changing at your age if treated wisely.

    Get some real advice. From heavy hitters, be it on YouTube or face to face perhaps for a nominal fee.

    However...

    Real capital preservation or just nominal? With unprecedented amounts of dollars, euro and yen printed in the last 9-12 months, the only sound advice on both investment and real buying power preservation is investing in physical gold, via the likes of goldcore.ie or Bullionvault.com Op.
    It's a totally liquid position that you can be out of 100% in just over 48 hours. I've already skimmed the maximum yearly CGT (Capital Gains Tax) amount from my investment (approx 1270 tax free on 25k in 4 months). If you time YOUR withdrawal s correctly, there is no way you couldn't do the exact same in December 2020, 2021 and 2022 for instance. Gold is not some crazy pipedream, it has a very predictable reaction to unfettered Central Bank largesse, particularly now with unlimited currency 'printing' i.e. Modern Monetary Theory.
    Watch Kitco.com or Stansberry Research on YouTube. Don't get overwhelmed by it, the perfect logic of s significant gold (and silver) price rise is rather simple to internalise.
    If you invest in straight money vehicles like Prize Bonds etc, you will lose money over 2 years (buying power) due to incoming inflation.
    Don't let anyone convince you otherwise.

    I had 10k in Prize Bonds a number of years ago. A family member had 25k. They were of limited value years ago but now, now they're just daft.


  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    Gold started 2011 around $1300 an ounce and finished the year around $1800. Come 2016 it was down to about $1100. It suits people who hold gold already to talk up the market so their asset might increase. They won't be around to explain themselves if the market crashes again.

    People with Prize Bonds don't care if more people buy them or cash them in, makes no difference to the notional interest rate.


  • Registered Users Posts: 4,198 ✭✭✭ An Ri rua


    Gold started 2011 around $1300 an ounce and finished the year around $1800. Come 2016 it was down to about $1100. It suits people who hold gold already to talk up the market so their asset might increase. They won't be around to explain themselves if the market crashes again.

    People with Prize Bonds don't care if more people buy them or cash them in, makes no difference to the notional interest rate.

    You're leaving serious inflation risks (this time, versus 2008-2012) out of the picture then? On a purported investment forum?

    Talk up the market.... I think you need to wallow in the conspiracy theories forum perhaps. I had no idea my posts were so powerful. Gold is a tiny market. Any entrance into it by mainstreamers will rocket the price.
    I commit to revisiting this thread every 3 months for the next 2 years (the Op's timeframe) to guage both of our assessments.

    Oh and please re-post and retweet my gold ramblings so that the price rockets.

    Thanks in advance.


  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    Prize Bonds is a sensible suggestion, not daft. Unless the OP wants to specify how much a "bit extra" is. They won't get much extra from any product which fully protects their capital. And they might get nothing from Prize Bonds.

    But everything else, including gold carries the risk of losing some of their original money. If the bit extra is say €2,000 after all taxes and charges, then I cannot offer any advice. They will have to make their own choice, and depending on anyone else on the internet to give them a guarantee is not wise.


  • Registered Users Posts: 469 ✭✭ PHG


    Hi OP,

    The best investment atm is in yourself. As you cannot really risk this money as you need it to spend on your future (college) you should not play around with this money.

    If you want to look at investing, only do so with dummy money atm. One of the golden rules is only invest with money you can afford to lose e.g. Imagine you put this into some stocks, gold or anything and it dropped 30%, where would you get the difference from (not even taking into account fees here).

    Put it in Prize Bonds and let it sit and pay for college and graduate with a min of a 2.1. If you have time and are able to, get a part time job and pull an emergency fund together of a few thousand by the time you leave (I am assuming that you may not have a job at present).


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  • Registered Users Posts: 2,645 ✭✭✭ krissovo


    Hey OP, stay away from Gold oh and any other liquidities at the moment. Its due a drop as the impact of COVID is no where near as bad as predicted. Gold is the go to resource for recessions or when there is risk of high inflation and history tells us it drops quite fast once economies pick up.

    You might be lucky and make a small gain but in two years the likely hood is that you will lose. If it was 6 months ago the advice would have different.


  • Site Banned Posts: 1,463 RIGOLO


    oreo47 wrote: »
    Hi
    I am currently going into second year of college.
    I have been left 10k by a kind uncle.
    I have also been told by my parents I will have to pay for fees and living expenses in 4th of college. I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks

    It would have been great if you provided a bit more information , like do you want to be active or passive, whether you want to day trade or just put it aside, what are your interests . Are you comfortable with risk or do you want very low risk, medium risk , etc. It would help people give you better advice.

    Anyways, whats your major and are you interested in trading stocks. Ive always liked the idea of investing in stuff that interests you, so if your major is computing then invest in that technology. Your young have a look at your friends and see what they are spending their money on and invest in that.
    Also the US election is coming up so you need to watch out for that, but again thats part of the game .

    I understand your 2 year timeline , but dont limit yourself, as someone else said, try to earn and save during this time and who knows the 10k you invest can sit and grow for 3,4,5,10 years,

    In general dont EVER put all our eggs in one basket, diversify and invest in somethign that stimulates you. Leave some in cash in case of emergency, although if you put it into prize bonds you can access it at short notice.
    If you want to trade then open an account and go ask in the other thread here for stock tips. If art, books or artefacts interest you then consider buying some physical items that you enjoy and will hold value or appreciate.
    Your uncle left the money for you to also enjoy as well as benefit, so respect that gesture, dont blow it, but dont forget to live a bit with it.

    good luck.. its a first world problem .. hope ye get back to college soon


  • Registered Users Posts: 1,788 ✭✭✭ Cute Hoor


    oreo47 wrote: »
    Hi
    I am currently going into second year of college.
    I have been left 10k by a kind uncle.
    I have also been told by my parents I will have to pay for fees and living expenses in 4th of college. I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks

    IMO oreo you would be batsh1t crazy to invest your €10k in Gold, or indeed any asset class, given your timeframe and this fine inheritance accounting for your total wealth, buying/holding/insuring/selling gold will cost you at least 5% so it would need to be increasing by at least 5% in value before you break even. The price of Gold has dropped by 3% in the last month, who’s to say it won’t drop further, it may double, triple, quadruple, same as any other asset class, but are you willing to take that risk and anybody who tells you where the price will be in 2 years time (and that’s your timeframe) is also batsh1t crazy, the longest timeframe that anybody could reasonably accurately predict for any asset class is probably between this moment and Trump’s next twitter. There are 3 potentially game changing scenarios right in our headlights at the moment, COVID, the Election and Brexit, any or all of which have the capacity to seriously damage any/all asset class(es). And that is just what we know about, the known knowns, what about the unknown unknowns, literally anything could happen that could seriously impact if not devastate any asset class in your timeframe.

    If you want to be guaranteed that your €10k is there when you need it in 2 years time then there are probably very limited choices for you, and you are going to get minimal return. With Prize Bonds you are guaranteed to get your money (€10k) back, nothing will be deducted from it for buying/holding/selling, the actual value may have decreased somewhat but given the current rate of inflation it should be minimal, and you also have a limited chance of winning. Other that that some bank might give you a minimal bit of interest.

    Your uncle was generous to you, you can make very good use of that money in 2 years time, don’t blow it. But do enjoy it!


  • Registered Users Posts: 2,832 ✭✭✭ Poor_old_gill


    Prize Bonds is a sensible suggestion, not daft. Unless the OP wants to specify how much a "bit extra" is. They won't get much extra from any product which fully protects their capital. And they might get nothing from Prize Bonds.

    But everything else, including gold carries the risk of losing some of their original money. If the bit extra is say €2,000 after all taxes and charges, then I cannot offer any advice. They will have to make their own choice, and depending on anyone else on the internet to give them a guarantee is not wise.

    I'm not advocating buying gold at the moment as I dont know enough about the market, however I need to take you up on one of your statements above.

    You have said gold carries the risk of losing money, due to the fact that CB's are printing & will continue to print money at a very accelerated rate over the next few years - doesn't the incoming inflation mean that prize bonds is guaranteed to lose money (in real terms) unless you have a very big win?


  • Closed Accounts Posts: 2,743 ✭✭✭ Heres Johnny


    Anything with a meaningful return to get your 10k even to 11 k in 2 years is inherently risky.
    If you need the full 10k for college keep it safe on deposit or prize bonds. If you only need part of the 10k for college you could invest the remainder as you see fit, but have an investment horizon of more than 2 years.


  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    I'm not advocating buying gold at the moment as I dont know enough about the market, however I need to take you up on one of your statements above.

    You have said gold carries the risk of losing money, due to the fact that CB's are printing & will continue to print money at a very accelerated rate over the next few years - doesn't the incoming inflation mean that prize bonds is guaranteed to lose money (in real terms) unless you have a very big win?

    There's 100 billion in the banks, 20 billion in State Savings, and I don't know how much in Credit Unions all losing money like that. If you are not going for gold, what advice would your give the OP?


  • Registered Users Posts: 2,832 ✭✭✭ Poor_old_gill


    There's 100 billion in the banks, 20 billion in State Savings, and I don't know how much in Credit Unions all losing money like that. If you are not going for gold, what advice would your give the OP?

    I dont have to give him advice, I'm not a financial advisor.

    I was just pointing out the fact that the suggestion of prize bonds will almost certainly crystalise a real loss, which was ironic considering the main argument made against gold was the risk element


  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    I dont have to give him advice, I'm not a financial advisor.

    I was just pointing out the fact that the suggestion of prize bonds will almost certainly crystalise a real loss, which was ironic considering the main argument made against gold was the risk element

    There was no need to point that out, I know what the effect of inflation is on savings, and so should a prospective university student. There is no irony in pointing out that gold halved and double its price over the last 10 years or so, it is a real fact.


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    There's 100 billion in the banks, 20 billion in State Savings, and I don't know how much in Credit Unions all losing money like that. If you are not going for gold, what advice would your give the OP?


    Could you also tell us the price of tea in China?


    There was no need to point that out, I know what the effect of inflation is on savings, and so should a prospective university student. There is no irony in pointing out that gold halved and double its price over the last 10 years or so, it is a real fact.


    It is also totally irrelevant, given the profile of the op and his objectives.


  • Registered Users Posts: 2,832 ✭✭✭ Poor_old_gill


    There was no need to point that out, I know what the effect of inflation is on savings, and so should a prospective university student. There is no irony in pointing out that gold halved and double its price over the last 10 years or so, it is a real fact.

    So you were recommending investing in something that you knew would lose real value as opposed to something that might lose real value?

    Maybe you shouldn't be giving out advice to people and you should probably be a little less sensitive aswell.


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  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    Jim2007 wrote: »

    It is also totally irrelevant, given the profile of the op and his objectives.

    His/her objectives are too vague for me.

    I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks


  • Registered Users Posts: 17,211 ✭✭✭✭ dxhound2005


    So you were recommending investing in something that you knew would lose real value as opposed to something that might lose real value?

    I joined the thread to disagree with the notion that Prize Bonds are daft. That poster also knows about the effect of inflation on savings, so that makes three of us.

    If you invest in straight money vehicles like Prize Bonds etc, you will lose money over 2 years (buying power) due to incoming inflation.
    Don't let anyone convince you otherwise.

    I had 10k in Prize Bonds a number of years ago. A family member had 25k. They were of limited value years ago but now, now they're just daft.


  • Registered Users Posts: 5,440 ✭✭✭ daheff


    There was no need to point that out, I know what the effect of inflation is on savings, and so should a prospective university student. There is no irony in pointing out that gold halved and double its price over the last 10 years or so, it is a real fact.
    Jim2007 wrote: »


    It is also totally irrelevant, given the profile of the op and his objectives.

    I don't think this is.

    dxhound is making the point (not fantastically well:rolleyes:) that gold is a volatile investment which can go up and down significantly over a given time horizon.

    The op hasn't very well explained the motivation for the investment AND the risk profile they are willing to take.

    On the 1-7 scale, 1 being no risk (capital preservation) 7 being extreme risk(could lose it all) the OP should decide where they sit.

    I'm guestimating that the OP is a 1 on this scale.

    as such, Prizebonds are one of the better investments the OP can make right now. Very liquid, 100% capital preservation (today) and with the possibility of a return.

    While we all know about inflation, which at the moment inflation is negligible. If that changes, having invested in prizebonds (and keeping an eye on things) the op could change the investment should inflation increase and better investment opportunities arise.


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    His/her objectives are too vague for me.

    I was just wondering whats the best way I could invest this now to have a bit extra when it comes to my 4th college year (so in 2 years time)
    thanks


    In that case you really should hold off until you understand an awful lot more..


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    I joined the thread to disagree with the notion that Prize Bonds are daft. That poster also knows about the effect of inflation on savings, so that makes three of us.


    Just because there are three of you does not mean your are right, you are advocating a high risk strategy to avoid negligible inflation.


    It's the kind of nonsense that would see you taken to court for incompetence if you were a financial advisor.


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    daheff wrote: »
    The op hasn't very well explained the motivation for the investment AND the risk profile they are willing to take.


    Which part of he needs the cash to cover his expenses in two years time do you not understand?


  • Registered Users Posts: 5,440 ✭✭✭ daheff


    Jim2007 wrote: »
    Which part of he needs the cash to cover his expenses in two years time do you not understand?

    I find your posting here very aggressive.

    The op has not started whether they are happy to risk any kind of losses in the hope of possibly achieving a gain (risk/reward), or whether they are extremely risk adverse and do not want any capital losses at all.... Or if they are happy to risk a larger loss for the possibility of a larger gain. Hence my point on risk reward scale.

    We don't know if the op's future expenses are 1k,5k,10k,15k. We suspect the amount is covered by the lump sum, but don't know by how much.

    Until we can know this we can't give very accurate advise. We can advise against investing in volatile assets (gold) as it's a risky strategy and the op needs money in 2 years. Investing in such an asset could leave the op with a loss when the funds are needed.

    Prize bonds are one of the least risky & most liquid investments that the op can make right now.

    But if inflation starts to pick up the funds in prize bonds (or a deposit account) will lose value in real terms. There may be a higher capital balance at the end of the term, but it's purchasing power could be reduced. This we don't know.


  • Site Banned Posts: 1,463 RIGOLO


    why are we all debating this dudes finances when he hasnt had the decency to respond to anyone in weeks.

    he probaly took the 10K and blew it all on VBucks...


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    daheff wrote: »
    I find your posting here very aggressive.


    Finance is not a game, people can loose serious money based on the comments made here.


    Poor advice and mistakes need to be challenged, because it can seriously impact people's lives.


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  • Registered Users Posts: 1,478 ✭✭✭ HarveyHunt


    Jim2007 wrote: »
    Finance is not a game, people can loose serious money based on the comments made here.


    Poor advice and mistakes need to be challenged, because it can seriously impact people's lives.

    Maybe so, but you were arguing with someone who defended prize bonds, can you set out why you think prize bonds are high risk in this instance? Seem to be a fair place to essentially deposit 10k for 2 years, not much return but not much risk of inflation devaluing 10k to any great extent atm either.


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