Childrens allowance

Guerilla Dub

Hi. Where do people who are in the fortunate position to save the Childrens allowance, put it?

I was looking at the state savings 10yr account with a 10% return. Anything better with zero risk?

Guerilla Dub

No answer. What else would I expect from a dead site...

Henry Ford III

It's far from dead. Perhaps the nature of your question was the issue?

A return of 10% after 10 years without risk is probably as good as you'll find. The problem is that with high inflation it's buying power will have fallen significantly.

You really need to look at investing with a view to at least matching inflation.

Jim2007

https://www.boards.ie/discussion/comment/119120081#Comment_119120081

People who ask for advice here often act on it, so responders are mindful of this and only contribute when the can make a useful contribution. Expecting a 10% return over 10 years at zero risk, is difficult to achieve and while people might have some ideas obviously none felt it worth making suggestions.

Jim_Hodge

https://www.boards.ie/discussion/comment/119120081#Comment_119120081

So busy we can't see all the posts.

We went the state savings route. The return's as good as you'll get without risk or tax. It worked out well and we gave the kids the money shortly after each married. They were flabbergasted by the amount at a time when it really was of value to them.

The J Stands for Jay

https://www.boards.ie/discussion/comment/119120081#Comment_119120081

There is no answer that gives zero risk . Even your state savings idea is not risk free.

Jim_Hodge

https://www.boards.ie/discussion/comment/119125315#Comment_119125315

In practical terms State Savings as as damn near risk free as you can get. Of course it may slip below inflation but from a protection of your investment point of view its safe: any perception of risk is academic.

Henry Ford III

https://www.boards.ie/discussion/comment/119125497#Comment_119125497

I wouldn't agree. The state was essentially bankrupt not that long ago.

There is always risk.

https://www.boards.ie/discussion/2058246258/childrens-allowance

When my kids were little, it often went towards the mortgage, food, clothing, etc. Never managed to save any.

Jim2007

https://www.boards.ie/discussion/comment/119126148#Comment_119126148

I would totally disagree. The state had a liquidly problem no a bankruptcy problem, states that continually produce positive balances of traded to not go bankrupt. So long as you continually sell more than you buy, you will eventually work your way out of the problem. That is why we continued to advise clients to invest heavily in Ireland during the last recession and it worked out very well for them.

The J Stands for Jay

https://www.boards.ie/discussion/comment/119126772#Comment_119126772

I saw some people who were advised that since the banks were all guaranteed by the government, they were essentially the same risk as government bonds. These people did pretty well by investing in Irish government bonds.

macvin

https://www.boards.ie/discussion/comment/119126148#Comment_119126148

Please explain, cos no intelligent person / economy commentator has said that.

Please don't come back with a sh1te answer saying sinn fein or paul Murphy said so.

The J Stands for Jay

https://www.boards.ie/discussion/comment/119126148#Comment_119126148

The outcome for state savings would be political rather than financial. No politician is going to burn the savers of Ireland, who are all potential voters. These products were always marketed at pensioners and parents. It wouldn't be a good look for the government to lose their guaranteed savings.

Jim_Hodge

https://www.boards.ie/discussion/comment/119126778#Comment_119126778

That has absolutely nothing to do with risk associated with State Savings.

Mrs OBumble

Anyone who is actually wealthy enough to not actually need the Children's Allowance for raising their children has access to proper financial advice about how to invest their cash.

Jim_Hodge

https://www.boards.ie/discussion/comment/119126875#Comment_119126875

You can be in a position to put Child's Allowance aside without being wealthy. Most who do don't pay for financial advice in doing so.

The J Stands for Jay

https://www.boards.ie/discussion/comment/119126835#Comment_119126835

It does, it gives an example of better returns that can be available for the same level of risk.

Jim2007

https://www.boards.ie/discussion/comment/119126778#Comment_119126778

Well that was more luck than good advice because the banks were not guaranteed by the government, they were taken over! Government bonds, selective corporate bonds and private corporate lending were the most interesting.

Jim2007

https://www.boards.ie/discussion/comment/119126785#Comment_119126785

Henry Ford III and Paul Murphy seeing eye to eye, now there is a disturbing thought ;-)

Jim2007

https://www.boards.ie/discussion/comment/119126875#Comment_119126875

No definitely not, they might have they flexible to afford the typical independent financial advisor fees from time to time but most are unlikely to do so.

coylemj

https://www.boards.ie/discussion/comment/119128172#Comment_119128172

The Govt guaranteed Irish bank deposits before a lot of them were taken over, it was to forestall a run on the banks.

https://www.independent.ie/business/irish/irelands-bank-guarantee-could-be-model-for-other-countries-26480997.html

This was quickly exploited by Michael Fingleton's son who ran an office for Irish Nationwide in London. He pointed out that as Irish Nationwide was now guaranteed by the Irish Govt., deposits in INBS were as secure as Irish Govt bonds. For which INBS got a €50,000 slap on the wrist..

https://www.irishtimes.com/news/irish-nationwide-fined-50-000-over-bank-guarantee-e-mail-1.829754

Henry Ford III

I think you're missing the point.

The financial meltdown was of such magnitude that the entire country would have gone bust without appropriate intervention from abroad.

A deposit account guaranteed by a bankrupt country has no value.

In this context once again every investment carries risk, albeit at different levels.

Guerilla Dub

My wife and I both work full-time and are not wealthy. We have enough to pay the bills every month, put food on the table, and have the odd holiday. I'm glad to see a discussion started from my OP, but I want to save the children allowance so I can give them a help in the future with a big event i.e. wedding, first car, travel etc. I was just asking where's best to put it, to get a bit if a return, without a real risk of losing anything.

Edit: That's a reply to Mrs. OBumble. (Quote didn't work)

Henry Ford III

Get proper advise, and be prepared to pay for it.

To make real returns over and above inflation you need to invest. There will be a risk element involved, which is unavoidable.

Shedite27

This thread got a bit off topic.

OP, depends what your time frame is for needing the cash, if it's saving for college (ie more than 10 years), equitiy fund sounds approporiate for a better return than 10% total over 10 years.

All the life companies have funds, Aviva, Zurich etc.

Call a broker and chat through the options. Most will meet for no initial fee (they get paid by the life company if you go ahead with the policy.

Jim2007

https://www.boards.ie/discussion/comment/119161647#Comment_119161647

The OP asked for "Zero Risk", which of these are you suggesting would meet that criteria?

Jim_Hodge

https://www.boards.ie/discussion/comment/119161647#Comment_119161647

Too risky. I did those for 10 and 15 year periods in the past and list on both investments. The OP wants low risk.

olestoepoke

https://www.boards.ie/discussion/comment/119126148#Comment_119126148

The beauty of this type of saving is that you tend to forget about it. It's saved automatically and you adapt to do without it. We started with the state savings scheme when the two kids were young and we could be looking at close to 40k by the time they are ready for college. Could potentially alleviate some of the the expense associated with college when the time comes.

Henry Ford III

https://www.boards.ie/discussion/comment/119162390#Comment_119162390

That would apply to any savings plan though, and you'd have made a lot more of it with a better plan in real assets.

Shedite27

https://www.boards.ie/discussion/comment/119162353#Comment_119162353

Presume that's a typo and you meant you lost twice on 10-15 year index fund investments. History's shown that investing in a S&P tracker for 10 years, you've only a 6% chance of a negative return, so for it to happen to you twice is incredibly unlucky. Yes it's not risk free but with the time frame involved it's worth considering

BN-OK832_ahapod_G_20160610131443.jpg

Jim_Hodge

https://www.boards.ie/discussion/comment/119166912#Comment_119166912

Look, you can quote stats all you like but the fact remains that I had one lot for 10 years that had a negative return on surrendering it. Another was after 15 years and I just got my capital investment back. Timing is everything and you can easily get caught out. This was in the 80s and 90s BTW.

Gant21

We are not in the 80s and 90s now Jim. Different times brother.

Jim_Hodge

https://www.boards.ie/discussion/comment/119167038#Comment_119167038

And you think things can't change, 🤣

Brother??

🥱

Shedite27

https://www.boards.ie/discussion/comment/119167025#Comment_119167025

I’m not disputing your outcome, I’m just pointing out that it’s rare. One persons experience shouldn’t colour the market as a whole. There’s lots of reasons why different people get different outcomes

Henry Ford III

https://www.boards.ie/discussion/comment/119162353#Comment_119162353

You must have either been spectacularly unlucky, or just had absolutely awful advice, or perhaps used the wrong vehicle. A review would have highlighted any issue and I'm assuming you didn't have any of those either.

Or maybe a combo of all of those?

Jim2007

https://www.boards.ie/discussion/comment/119168278#Comment_119168278

He mentions 'surrendering it', so I expect it was a product of some kind rather than dollar cost averaging an index....