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50K to invest prsa vs managed fund advice

  • 05-11-2021 11:35am
    #1
    R0me0
    Registered Users Posts: 2 ✭


    Folks

    First Post here and thanks if you can offer any tips/ideas.

    Mortgage paid, no loans , kids reared.Healthy savings and public pension in 6yrs time.

    Looking for advice on investing 50k. Thinking of maxing out my and my wife's existing prsa over a few years due to the tax relief and small fees payable.

    Other idea which I have verbally committed to with a financial advisor.invest the 50k in the irish life protected consensus market fund.total annual management fees 1.82%.

    Just don't want the 50k sitting in a bank.

    Thanks again.



Comments

  • #2
    grassmoon
    Registered Users Posts: 29 ✭grassmoon


    AMC of 1.82% is quite high. Davy Execution only PRSA offer 0.75% and let you invest in passive index funds.



  • #3
    Supercell
    Registered Users Posts: 15,319 ✭✭✭✭Supercell


    Open a Degiro account and put it all in SMT, thank me in 6 years.

    https://www.loughlinstown.ie

    Have a weather station?, why not join the Ireland Weather Network - http://irelandweather.eu/



  • #4
    grassmoon
    Registered Users Posts: 29 ✭grassmoon


    Any active fund you get from an Irish finance company will have high fees and poor performance.



  • #5
    Static M.e.
    Registered Users Posts: 3,087 ✭✭✭Static M.e.


    (SMT = Scottish Mortgage Investment Trust PLC)

    How long do you plan on investing for?

    Depending on that answer. Similar to SuperCell above, I would open a Degiro account and put it all on an ETF or something like SMT. Just make sure you understand the tax implications of whatever options you choose.

    For some background reading, I really like this website AnIrishInvestorsGuide – The simple guide for Irish investors.

    and this is worth reading too

    Don’t invest in an ETF until you understand the tax (irishtimes.com)



  • #6
    [Deleted User]
    Posts: 281 ✭✭[Deleted User]


    AMC of 1.82% is horrendous.


    If you add the Other Ongoing Costs to that (assumimg that you can Irish Life to disclose them) you're probably looking at an equivalent Total Expense Ratio of circa 2.5%.


    Way better value in the market than that for these products.


    What dod the finiancial advisor say about putting some money into the PRSA?



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  • #7
    The J Stands for Jay
    Registered Users Posts: 5,645 ✭✭✭The J Stands for Jay


    https://www.boards.ie/discussion/comment/118143645#Comment_118143645

    It's the worst possible type of fund in this case. It's protected, which contributes to the cost, but the protection is likely not worth it, and then it's a consensus fund, which means the active management is merely copying the average asset allocations of other actively managed funds; hardly worth paying an active sized fee for.



  • #8
    grassmoon
    Registered Users Posts: 29 ✭grassmoon


    A low cost investment trust like SMT is a good option. I'm invested in them myself.



  • #9
    R0me0
    Registered Users Posts: 2 ✭R0me0


    Thanks Folks.

    Decided not to go ahead with the Irish life investment even before I read your opinions.

    I didn't discuss in depth the prsa idea with the financial advisor.

    The investment would be long-term 10yrs min.

    FYI. I have a deffered pension from a prior employment that i left in 1999 that was worth £10k at the time.Its current value is €74k.Hence my interest in putting the lump sum into equities.

    I will do a bit of research on your advice and take it from there.

    Thanks again.



  • #10
    uli84
    Registered Users Posts: 1,666 ✭✭✭uli84


    https://www.boards.ie/discussion/comment/118132205#Comment_118132205

    Why are you so optimistic about it?



  • #11
    uli84
    Registered Users Posts: 1,666 ✭✭✭uli84


    https://www.boards.ie/discussion/comment/118149611#Comment_118149611

    Would you be able to tell me more regarding tax implications when investing in SMT?



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  • #12
    Static M.e.
    Registered Users Posts: 3,087 ✭✭✭Static M.e.


    @Uli84 I personally don't invest in Investment Trusts (ITs) so I'm not the best person to answer. I believe the main difference is how they are treated for tax. With ITs you pay 33% Capital Gains Tax when you withdraw the funds as opposed to the 41% exit tax every 8 years and on withdrawal with EFTs. With ITs you can also use your annual CGT allowance of €1270 to offset losses against any gains. They are definitely worth looking into and they have a lot of strong\experienced followers here so I hope one of those could jump in and help you.



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