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What to do with €40,000....

  • 02-04-2022 8:11am
    Registered Users Posts: 80 ✭✭

    I am entitled to access 25% of an old private pension in September that was "bought" off me which will be roughly €40,000 tax free. Would love to do something with it but am very undecided.

    My initial thoughts are

    - leave it in the fund, €40k now might be €45k or more (being 25% of the fund) in a few years

    - buy a garden room & do up the garden, the former isn't essential but the latter is needed.

    - invest in a small H&S and workplace training business I currently have. No idea what to do with it in that context though.

    - spend more time with my 2 kids (5¾ & 2½) using the extra money to replace the second income from my 2nd job. I currently do the 2nd part-time job largely because we need the additional income. Not the most intelligent use of money but it would give me invaluable extra time with my kids on my days off. (I work shift so I'm off during the week quite a bit)

    - buy an investment property, although I think I'd need to at least double the €40k to have a viable deposit.


  • Registered Users Posts: 1,919 ✭✭✭Andrea B.

    Food for thought; How much per annum do you spend on heating, energy, travel fuel?

    What type of systems do you have using these energies?

    Items like condensing boilers, insulation and EV's are offering faster ROI based on higher fuel prices. After payback, they are savings year on year.

  • Registered Users Posts: 80 ✭✭SmithsFan

    I'm in an A3 BER rated home, so the only option would be the EV.

  • Registered Users Posts: 1,760 ✭✭✭ballyharpat

    How much do you spend on petrol per year at the moment? is it enough to justify a change?

    How old are you? do you have a fund set up for your kids in college? Are your kids currently missing out on time with you? are they with family when not with you, or with a carer? Would the time be better spent with them when they are older?

    If you did the extra room, would you get a lot of use out of it? Would the garden improve your quality of life. and/or that of yourkids/family?

    Buying an investment property is going to involve a lot more time from you, taking more time and money away from your kids and mainly more costs for a certain period of time, as well as a learning curve to being a landlord, which, imo as a landlord, is not worth it unless you plan on buying more properties at some point.

  • Registered Users Posts: 80 ✭✭SmithsFan

    Am saving the children's allowance so that will yield approx €30k for each of them when they turn 18, hopefully a bit more depending on the returns from the policy.

    We'd definitely use the garden more if it was in better nick, it's very boggy after any damp spell so I'd look to install artificial grass. The extra room (garden room) would be ideal as an office or man cave given we only have 2 rooms downstairs in the house currently, a living room and a large kitchen/dining room.

    Despite working 2 jobs I do get to spend more time with my kids than most because my main job is shift work. That said, I don't think you can ever spend enough time with young kids.

    I was just curious what the best use of the money might be. I won't say it's entirely risk free, but in the circumstances I have a few options available to me as to how to use it.

  • Registered Users Posts: 292 ✭✭pjdarcy

    Set up a meeting with a financial advisor. They'll be able to assess your current financial situation fully, how secure you'll be in the future and be able to advise you accordingly.

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  • Registered Users Posts: 80 ✭✭SmithsFan

    I have a good one on the case already. That's where the €40k is coming from originally.

    I was more interested in people's views on investing the money in a small business, doing up the garden or just spending it. Keeping it where is or reinvesting it in another policy is probably a safe bet. This was more about maybe enhancing our family life or taking a punt on the small part-time business (2nd job) I currently have and who knows, maybe turning €40k into a really successful business.

    Some people seem to have a knack of spending money well, people with a good head for business etc and can sometimes give interesting accounts of their experiences.

    Thanks for the feedback so far.

  • Registered Users Posts: 114 ✭✭AnF Chuckie egg

    Just because you have a lump of cash doesn't mean you have to go and use it right away. It will not vanish overnight or in 12 months no matter what the inflation sceptics say.

    For me I made a lot of money over the years just by being long term invested. If you want to invest and are not up to speed with investing then avoid short term investments that you know nothing about, or short term in general. Look at managed investment funds, and know that cheaper is not always better. Those low cost funds usual have next to no body doing any work with the money. If you want returns then you have to pay the people working to get them.

    Personally my biggest regret is not missed investments but missed time with my family while they were growing up

  • Registered Users Posts: 3,098 ✭✭✭Browney7

    Is the 40k invested in a pension wrapper and so is accumulating tax free? If this 40k is accumulating tax free it seems a no brainer to leave it where it is and use the 30k you have for college education for kids for any spending as any investment return is suffering DIRT or income tax or CGT. Just a thought