What would you do with €130K in savings as a 30 year old?

Jim2007

I see sheep wrote: »

In some ways fair play accumulating that much money at a young age.
But...

I hope you haven't wasted your 20s accumulating money rather than enjoying life.
If you have done, then start enjoying life now while you're still young.
Leave half the money in the bank and quit your job and travel the world for a few years with the rest.
When you come back (if you want to come back) you'll get another job.

There's more to life than a little bit of money, you know. Don'tcha know that?

Oh dear..... someone who associates enjoying life with blowing their savings...



Most people who accumulate savings tend to joy life just fine. They travel, see the world etc.... they just don't spend money on the crap the rest of us do.

Davauer

Buy a house after the prices crash this year
Also the stock market should crash when government stop pumping money into economy keeping prices high

Timmaay

Jim2007 wrote: »

Oh dear..... someone who associates enjoying life with blowing their savings...



Most people who accumulate savings tend to joy life just fine. They travel, see the world etc.... they just don't spend money on the crap the rest of us do.

+1 to this. If your a driven person who is happily succeeding in life and making nice money and especially if your also making a valuable contribution to the world, why the hell would you stop.

Mongfinder General

€130k at 30 years of age. Just keep doing what you’re doing.

markpb

Fred Cryton wrote: »

I don't understand this. You can still get a mortgage, right? You're just choosing not to. So what if you need to move in 5 years, can't you sell the house?

You’re ignoring the cost of buying and selling a house, the possibility that house prices will drop in five years so the OP won’t be able to sell when they need to, the flexibility that renting gives them in the short term, the fact that they’ll need a 20% deposit for the second mortgage.

Or alternatively you could buy an investment property now with this, rent it out to cover the mortgage, then save up another 100k plus and use that in 5 years to buy another home. Rinse and repeat about 3 more times and retire at 45.

If you’re buying a house to rent, you can’t get a normal residential mortgage, you’ll need a more expensive BTR mortgage. You’ll need to pay RTB fees, agent fees (unless you want to manage it yourself), tax rates (income and PRSI) will be quite high and none of the pre-letting expenses like furniture are tax deductible. If you’re buying a house for cash or mostly for cash, you’re removing one of the few tax deductibles available to you. You need to commit funds to pay for normal wear & tear, emergency repairs, damage done by tenants and be able to pay a rental mortgage even if the tenant stops paying for several months.

The more houses you rent, the more exposes you are to a recession.

That’s not too say either of those are bad ideas but you need to be aware of the pros and cons of them.

I see sheep

Jim2007 wrote: »

Oh dear..... someone who associates enjoying life with blowing their savings...



Most people who accumulate savings tend to joy life just fine. They travel, see the world etc.... they just don't spend money on the crap the rest of us do.

The op said he lived frugally and spent time living at home which implies he's been saving a huge amount of his salary.

If he has enjoyed himself & travelled etc. great but I doubt it going by what his post said.

What's the point in saving money just for the sake of it?

kravmaga

Yyhhuuu wrote: »

Ulster Bank pay 0.85 per year and you can pay 3,500 per month. But they may pull out of ROI.

I would not advise the OP to put any money into Ulster Bank, Nat West their parent bank in the UK are looking at options to pull out of ROI completely.

They already have outsourced all ROI private/ business accounts to a call centre in Scotland. Terrible customer service, plus they are going to sell off all non- performing loans.

I see sheep

I see sheep wrote: »

The op said he lived frugally and spent time living at home which implies he's been saving a huge amount of his salary.

If he has enjoyed himself & travelled etc. great but I doubt it going by what his post said.

What's the point in saving money just for the sake of it?

He said he lived rent free, he didn't say at home.

HamSarris

€30,000 Stocks (weighted value versus growth and includes emerging markets)
€25,000 deposit for rental property or buy own house and use rent a room scheme
€25,000 Gold
€15,000 Silver, Copper, Uranium & Oil
€10,000 Silver, Copper, Uranium & Oil miners/producers
€15,000 TLT Bonds
€10,000 Short High Yield Corporate Bonds

garbanzo

Champagne and strippers....at you age I’d set aside a small bit for that. 😃😃😃

sphinx501

I am in a similar situation, have 50k in Irish Life MAPS but the returns have stagnated after 5 years so trying to decide between...

- Maximising AVC on an existing PRSA
- Maximise Mortgage Repayments (Currently 30 Years Remaining)
- Invest in ETF (VWCE)

I am contemplating ETF option with continuous monthly buy in, as I don't want the money locked into PRSA or property. Thinking a decent % return on ETF will out grow my mortgage (currently 2.2%).

garbanzo

garbanzo wrote: »

Champagne and strippers....at you age I’d set aside a small bit for that. 😃😃😃

At that age I'd set aside a small bit NOT for that.

massdebater

If it was me at 30yo, I'd aim for:

60ish% Total world stock market (this can be split up further into regions but no need to add extra complexity at this stage)

20-30% cash (to be invested monthly into the above over the next 12-18 months until it's all invested or lump sum invested in the event of a big dip in the markets)

10-20% crypto (BTC, ETH should make up the bulk of this)

Mathematically you're better off not having any cash on the sidelines and investing it all right now, but keeping some to the side is easier psychologically. So long as you have a plan to regularly invest this cash portion and don't leave it out of the market. Also having cash has other perks (you can bargain with landlords for cheaper rent if you pay for a few months up front etc)

With this plan, if the market goes up: happy days, you have most of your money working for you and a solid plan to add the remaining amount over the next short while. If the market goes down, you get to take advantage of cheaper prices and your average cost per share will go down. This should help with your hesitations around getting the timing wrong.

Pension might be a good option if you're ok not having access to that money for another 30ish years but I'd probably stay away from that personally. I also wouldn't buy a house if you might end up moving in a few years anyway.

You seem to have the frugal lifestyle down already so you can probably afford to be a bit riskier than most with your investments at your age. Good luck with whatever you decide to do!

Shiny

Consider the tax benefits of a pension if you have not already done so.

If you are moving abroad for work use that to your advantage and use the temporary location as a jump point to visit places that are difficult/expensive to reach from Ireland.

Talk to a financial advisor, if you spent a bit of time talking to a professional they will present a number of different options and explain the risks.

Padre_Pio

massdebater wrote: »

If it was me at 30yo, I'd aim for:

60ish% Total world stock market (this can be split up further into regions but no need to add extra complexity at this stage)

20-30% cash (to be invested monthly into the above over the next 12-18 months until it's all invested or lump sum invested in the event of a big dip in the markets)

10-20% crypto (BTC, ETH should make up the bulk of this)
!

Im in a similar boat, probably have 60k to invest. I have no idea about stocks and no desire to learn.

Any recommendations for a managed fund?

Buddy Bubs

Padre_Pio wrote: »

Im in a similar boat, probably have 60k to invest. I have no idea about stocks and no desire to learn.

Any recommendations for a managed fund?

http://funds.irishtimes.com/

Theres a listing of the different funds where you can see historical returns. Massive database but its interesting to have a poke around and compare different types of funds and similar funds in different companies.
It's all historical so no guarantees but interesting site all the same.

Bobeagleburger

Max pension, and if you have a mortgage pay it off. That's two of the quickest ways to start accumulating wealth. Maximise that pension tax break.

After that with a lump sum investment:

ETF such as one from Vanguard or Investment Trusts.
Blue Chip portfolio.


I'd stay away from ETFs if it's regular savings.

I'd limit stocks paying dividends due to tax. I'd move into them at retirement if you have money to play with then.

Good luck.

Stark

Be wary of the tax on ETFs , it's a nightmare. That's the big advantage of pension funds. They can invest in ETFs on your behalf and not worry about the tax. Though if you buy US domiciled ETFs, it's not so bad.

Bobeagleburger

Stark wrote: »

Be wary of the tax on ETFs , it's a nightmare. That's the big advantage of pension funds. They can invest in ETFs on your behalf and not worry about the tax. Though if you buy US domiciled ETFs, it's not so bad.

They are fine for lump sums if you leave them there accumulating.

A massive pain if you are making regular purchases. I've been advised against this sort of regular purchase by many tax experts.

HillCloudHop

Thanks for all your thoughts so far.

I'm on the single public service pension scheme. AFAIK I can't alter my contribution to max this out any further. Maybe I'm wrong though.

Are investment trusts a better alternative to ETFs?
They seem to be taxed as stocks at 33% and without the deemed disposal rule.
What disadvantages are there with an investment trust compared to an ETF?

Which stock broker is best from an Irish perspective? Degiro or Trading212?

lisasimpson

HillCloudHop wrote: »

Sorry, I phrased this poorly. I have to move across the country and likely abroad every year for the next 5 years to progress in my career. Would it be a lot of hassle renting a property out and dealing with tenants in this case?

Well done on saving that amount.i hope you have also enjoyed some of your hard earned cash in your downtime.
If your not in a position for a set number of years check out the state saving certs via An Post. Best of returns. Best sacings return at the moment. Also looking into maximising your pension contributions.

RobbingBandit

Buy 40k worth of a low value cryptocurrency in bursts of 5k watch its value increase buy low sell high.

lisasimpson

Have to laugh at some people asuming if you saved loads in 20s you havent enjoyed life. In a previous job a woman started a thing about what salary was i on paying rent and always going on holidays, nights out, matches, gigs etc and she was always broke. Little did she know i was saving a nice bit too and had a deposit saved

Its taking time to sit down and work out a little financial management moving home wasnt an option. 1st off direct debit into a notice savings account on payday you wont miss the money and the few times i got a pay increase i upped the direct debit amount.
Make sure your tax credits are up to date esp if employers are paying you health insurance. Thats worth 200 a year. Claim any other tax refunds to you can ie med1 form for doctors visits etc. Last year the younger members of the team at work didnt know about this and i got refunds for a number of them when i explained it to them
Also if you have health insurance employer paid or otherwise make sure you read what day to day expense you can claim for ie physio, contact lenses etc
A revoult account and a bit of discipline is handy too. Any revenue or health refunds amounts into a vault. Always use loyality cards in dunnes, tesco boots and those saving also into the revoult vault...surprising how it adds up.supervaue card is handy if your a fan of online shopping. That vault had paid for many a ryanair flight.
Aldi and Lidl also become your friend.. Review your subscriptions regularly. Do you need to pay for netflix every month. For summer months i always cancelled it as i dont be home enough to get ful value for it. Same with mobile plan review regularly. Im not a massive drinker compared to when I was younger so sometimes I drive on a night out. Had a flatmate who loved travel wasnt on massive wages so she was great not running up bills etc. We use to often do taxi for each other on weekends. She was great at using adverts and done deal for selling stuff she no longer needed. Try to take your own lunch to work 2 or 3 days a week is another good saving. Often its the small thinga when they all add up make a difference

wfdrun

Deleted User wrote: »

And I have zero and highly unlikely to buy one, but to say they have zero value is clearly wrong.

clearly wrong?? can you evidence please

djan

wfdrun wrote: »

clearly wrong?? can you evidence please

I mean if they have zero value they'd be "trading" for €0 no?

Sure stocks can be analysed by fundamentals but look at Tesla, a lot of it is hype. Crypto currencies have utility too.

Back to the OP, I'd like to add to be wary of maxing out pension as while it is tax free, drawing it down certainly isn't and you are pretty much locked out of it for the next 35 odd years. Would it be an idea to move funds to a country with more favourable investment taxation and let it grow there or move elsewhere all together?

Regarding investment property, it is a lot of work with and plenty of risk given the current legislation of not enforcing evictions and backpayment of rent (even outside of the covid eviction bans).

I would look into compounding investments in the long term plan of ideally living off dividends.

bilbot79

It depends on your goals in life and when you might need that cash. Even when maxed out on pension contributions, the pension is a nice place for the net cash to be if for example your ultimate intention is to retire early. It could take a couple off years of the time it takes to reach e.g. 2m etc.

Given your lifestyle so far I wouldn't be surprised if this was a goal for you. I'm 42 and doing good now but not as well as you

Jimbobjoeyman

djan wrote: »

Would it be an idea to move funds to a country with more favourable investment taxation and let it grow there or move elsewhere all together?

Almost certain revenue will still want their share of this.
I've an ISA which is tax-free right now as I'm living in London and thinking about moving home and from what I can see they will want their share of this as long as your living in Ireland and are tax resident regardless of where the investment structure is based.

djan

Jimbobjoeyman wrote: »

Almost certain revenue will still want their share of this.
I've an ISA which is tax-free right now as I'm living in London and thinking about moving home and from what I can see they will want their share of this as long as your living in Ireland and are tax resident regardless of where the investment structure is based.

I wonder if this would be the case if you were to transfer funds abroad and let them compound there and never bring them or the gains back to Ireland.

Jimbobjoeyman

djan wrote: »

I wonder if this would be the case if you were to transfer funds abroad and let them compound there and never bring them or the gains back to Ireland.

What use is that to you then?
You've to realize the gains at some point or why bother saving at all and just blow it on hookers and drugs as suggested earlier and have some fun with it.

Only way this makes sense is if you move with the money and then realize it in a more tax efficient country when your no longer tax resident in Ireland.
But tbh for this amount of money I wouldn't think that'd be worth ripping up your life for.

djan

Jimbobjoeyman wrote: »

What use is that to you then?
You've to realize the gains at some point or why bother saving at all and just blow it on hookers and drugs as suggested earlier and have some fun with it.

Only way this makes sense is if you move with the money and then realize it in a more tax efficient country when your no longer tax resident in Ireland.
But tbh for this amount of money I wouldn't think that'd be worth ripping up your life for.

What you describe is exactly what could be done. Keep saving and investing abroad and within 25 odd years you should be hitting 500k on a relatively on a conservative outlook and at that point take a half year long holiday to said country, realise profits and enjoy retirement.

TimeToShine

I don't disagree that you can save and have a good time but realistically if you finish college at 22 and spend the next 8 years working a very well paid job earning 60k on average (being very generous) you are probably bringing home 35k a year after pension contributions. That's 280k in revenue so in this specific example if you've managed to save pretty much 50% of that and still enjoy yourself to the fullest that would definitely be a tough one to pull off, in my view it is unlikely that you did anything and everything you wanted to while you had the time and freedom.

wfdrun

wfdrun wrote: »

clearly wrong?? can you evidence please

https://www.google.com/search?q=bitcoin+value&rlz=1C1CHBD_enIE873IE873&oq=bitcoin+value&aqs=chrome..69i57j0l9.3930j1j7&sourceid=chrome&ie=UTF-8

If you want to philosophize you're in the wrong thread.

Jim2007

HamSarris wrote: »

€30,000 Stocks (weighted value versus growth and includes emerging markets)
€25,000 deposit for rental property or buy own house and use rent a room scheme
€25,000 Gold
€15,000 Silver, Copper, Uranium & Oil
€10,000 Silver, Copper, Uranium & Oil miners/producers
€15,000 TLT Bonds
€10,000 Short High Yield Corporate Bonds

Total nonsense, you are proposing a portfolio that goes beyond the any concept of high risk in portfolio management.

rapul

RobbingBandit wrote: »

Buy 40k worth of a low value cryptocurrency in bursts of 5k watch its value increase buy low sell high.

Yep, dogecoin!

Unreal movement lately

McGiver

Stark wrote:

Be wary of the tax on ETFs , it's a nightmare. That's the big advantage of pension funds. They can invest in ETFs on your behalf and not worry about the tax. Though if you buy US domiciled ETFs, it's not so bad.

Why? What's the issue? And how is it different to stocks?

I'm using the same platform/broker for both.

Stark

Individual stocks are taxed as capital gains (33%) which is relatively straightforward.

ETFs are taxed higher at 41% and they also have this really annoying 8 year "deemed disposal" rule so calculating the tax can be quite burdensome for a retail investor https://www.askaboutmoney.com/threads/etf-deemed-disposal-example.216821/

I have some ETFs myself. Will probably try to sell them all before 8 years is up on the first payment rather than trying to calculate the tax on a month by month basis after that.

JasonStatham

berocca2016 wrote: »

OP could be a woman?

And she could be gay. Will the speculation ever end?

Sam Hain

patsy_mccabe wrote: »

OP, whatever you do, stay away from cryptocurrencies. Its frightening the amount of people that don't realise they're worthless.

Its frightening the amount of ignorance in one post.

masterboy123

I would play safe:

-Avoid crypto!
-Invest upto 10% in well recognised multi national companies such as Google.
-Buy what you like and don't regret.
-Keep your savings securely.

Enjoy!

P.S. I am in the same age group with similar amount of savings.

Jim2007

Sam Hain wrote: »

Its frightening the amount of ignorance in one post.

It’s frightening that you seem to fail to understand the intrinsic value of a currency.... it is zero! Now it does not matter if it is a dollar, a Euro of your favorite crypto currency, it’s worthless unless people believe in it.

Now people believe in say the Dollar or the Euro because the are the currency of major trading blocks. Which means that is widely accepted in business transactions and there are mechanisms in place to support or at least people have that expectation.

This is not the case with any crypto currency, there is nothing behind it but people’s believe in its story, nothing in place that might be used to try and restore confidence in it, should that confidence be shattered and no why to widely use it in commerce without being able to convert it into a monetary unit such as the dollar or the euro. It has all the risk characteristics of a tulip bulb and no amount of sophisticated maths etc is going to calm the nerves if the balloon goes up.

Currency speculation is always a high risk undertaking for the retail investor and even more so when the entire value is based on market perception.

Warnings are well justified.

Jim2007

Jim2007 wrote: »

Warnings are well justified.

For sure, but the point was well made that the poster referenced is completely wrong in saying there is no value in a bitcoin. Try buying one now for $30k and you'd be laughed out of it.

What's the value of the Mona Lisa? A couple of euro in wood and canvas ruined by being used. Yet, it's considered priceless.

While people place a value on bitcoin and the like it has value in the exact same way as a canvas with oil paint hanging in the Louvre.

bilbot79

sphinx501 wrote: »

I am in a similar situation, have 50k in Irish Life MAPS but the returns have stagnated after 5 years so trying to decide between...

- Maximising AVC on an existing PRSA
- Maximise Mortgage Repayments (Currently 30 Years Remaining)
- Invest in ETF (VWCE)

I am contemplating ETF option with continuous monthly buy in, as I don't want the money locked into PRSA or property. Thinking a decent % return on ETF will out grow my mortgage (currently 2.2%).

I think you have order right there. After AVC it's mortgage and then stocks n shares.

Debt is cheap now but if you pay it off while rates are low you'll be able to take advantage of impacts of higher rates later with the spare cash. If you don't pay it off and rates go up well it'll be more money to the bank and less invested for you.

patsy_mccabe

Deleted User wrote: »

For sure, but the point was well made that the poster referenced is completely wrong in saying there is no value in a bitcoin. Try buying one now for $30k and you'd be laughed out of it.

What's the value of the Mona Lisa? A couple of euro in wood and canvas ruined by being used. Yet, it's considered priceless.

While people place a value on bitcoin and the like it has value in the exact same way as a canvas with oil paint hanging in the Louvre.

You still don't get it. Just because something is trading for a certain value, doesn't mean that it is worth that value. Think of the classic bubble of trading tulips.

Think of it this way. Anyone can set up a cryptocurrency. Its all unregulated. Let's say you set one up and so does your friend. Let's say there's a 1000 units in each. You buy one of his units for €1000 and he buys yours for €1000.
Your cryptocurrency is now worth a million € and so is his. It really is that crazy.

timeToLive

Jim2007 wrote: »

It’s frightening that you seem to fail to understand the intrinsic value of a currency.... it is zero! Now it does not matter if it is a dollar, a Euro of your favorite crypto currency, it’s worthless unless people believe in it.

Now people believe in say the Dollar or the Euro because the are the currency of major trading blocks. Which means that is widely accepted in business transactions and there are mechanisms in place to support or at least people have that expectation.

This is not the case with any crypto currency, there is nothing behind it but people’s believe in its story, nothing in place that might be used to try and restore confidence in it, should that confidence be shattered and no why to widely use it in commerce without being able to convert it into a monetary unit such as the dollar or the euro. It has all the risk characteristics of a tulip bulb and no amount of sophisticated maths etc is going to calm the nerves if the balloon goes up.

I don't think ignorant investors should put their money in cryptocurrency but your post reads like a mishmash of critiques you have heard. It sounds like you haven't really read up on it because all of that has been discussed to death.

patsy_mccabe

patsy_mccabe wrote: »

Think of it this way. Anyone can set up a cryptocurrency. Its all unregulated. Let's say you set one up and so does your friend. Let's say there's a 1000 units in each. You buy one of his units for €1000 and he buys yours for €1000.
Your cryptocurrency is now worth a million € and so is his. It really is that crazy.

It would be if that's how it worked. In your scenario your coin has no liquidity. Nobody else is going to buy the coin for €1,000. To see how wrong your scenario is why don't you try and show us your bank statement with €1m in it. You will find people that made millions out of bitcoin.

People think they are being smart when they say bitcoin has no value, they claim to be inheritors of the wisdom from person that cried 'the emperor has no clothes' - 'You still don't get it.'. It's a bit sad really.

Take shares as an example where some here think are safe whereas bitcoin isn't. Some shares are crazily priced. I wouldn't buy bitcoin or the likes of TSLA for that matter, but I can see they have value.

BTW, reread your sentence very carefully.

patsy_mccabe wrote: »

Just because something is trading for a certain value, doesn't mean that it is worth that value.

Now think about gold, or lots of art.

Jim2007

Deleted User wrote: »

For sure, but the point was well made that the poster referenced is completely wrong in saying there is no value in a bitcoin. Try buying one now for $30k and you'd be laughed out of it.

What's the value of the Mona Lisa? A couple of euro in wood and canvas ruined by being used. Yet, it's considered priceless.

While people place a value on bitcoin and the like it has value in the exact same way as a canvas with oil paint hanging in the Louvre.

It is not the same at all, art works have a price as far as the owners are concerned - the amount the insurers are willing to pay in the even of the piece being damaged, stolen or lost. And it is not a currency so there is not possibility for currency speculation involved.

Tar.Aldarion

There is crypto, and there is bitcoin, I'd consider them two different levels of safety and validity. Especially since they are being adopted by paypal/visa and being rolled into bank usage.

patsy_mccabe

What about Titcoin? It has a market cap of $ 17,931. With a name like that, it can only go in one direction.
( See what I did there ...... tits up, and all that)

https://crypto.com/price/titcoin

Unearthly

Tar.Aldarion wrote: »

There is crypto, and there is bitcoin, I'd consider them two different levels of safety and validity. Especially since they are being adopted by paypal/visa and being rolled into bank usage.

Tesla announced today big investment into Bitcoin sending the shares up. I intended to put money in last night but hadn't yet passed KYC with the broker

Car99

[Deleted User] wrote: »

Will it be a great anecdote? Or will it be a brief amusement, and the main takeaway people will have is "what a gobsh1te that guy must be"?

Only if he lost on the table and became financially ruined afterwards would ppl think that. If he was rich while charismatically delivering his anecdote people would say fortune favours the brave bravo and all that.