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Child Item

Beginning to Invest - All questions go here please

iMax

Guys,

Looking for a little bit of info from those more knowledgeable than me.

My five year old daughter has the above sum in her college fund. We've really skimped for it over the years (started before she was born).

Times are getting harder for us economically & it looks like we won't be able to contribute to it like we were (or at all) for the foreseeable future, but I want to keep it growing if at all possible.

It's currently in an AIB kids account where it ears a meager interest rate.

We were thinking of maybe the state solidarity thing or prizebonds (someone's gotta win, right???). IS there anything else we should look at ? No risk is much preferred (as much as anything can be no risk). I know you don't get as high a return, but it's my daughter's future I'm dealing with.

We don't mind it being locked away (probably a good idea in the long run). Also we'd like to be able to capitalise by being able to add to it if possible.

Looking forward to the replies

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displaced dub

hi iMax

I currently have my kids money paid into Anglo at 3.75%, my 2.5year old is making nice money and the newborns is now being paid into this account also.

If you are thinking of buying shares with this, think long and hard about it.
You could buy some ETFs in various exchanges also.

Xios

My advice has no weight what so ever, but heres my two cents, i see saving money long term could yield a loss, because of inflation it'll lose value over time. I'd be more inclined into putting the money into something physical that will hold it's value over the long stretch of time. Perhaps land? Or maybe a piece of farmland for lumber, maybe a certain type of tree that'll take 16 years to be ready for harvest and by then it'd be making a profit. Of course that has it's risks over 16 years and i know nothing of it, it could would be worth the research.
Also what if the euro collapses in that time?

Take the other posters advice over mine, i'm only new to this idea of investments and i've never had any money of my own to spend really, my biggest investment was a motorbike which was 2700 euro.

T Corolla

iMax wrote: »

Guys,

Looking for a little bit of info from those more knowledgeable than me.

My five year old daughter has the above sum in her college fund. We've really skimped for it over the years (started before she was born).

Times are getting harder for us economically & it looks like we won't be able to contribute to it like we were (or at all) for the foreseeable future, but I want to keep it growing if at all possible.

It's currently in an AIB kids account where it ears a meager interest rate.

We were thinking of maybe the state solidarity thing or prizebonds (someone's gotta win, right???). IS there anything else we should look at ? No risk is much preferred (as much as anything can be no risk). I know you don't get as high a return, but it's my daughter's future I'm dealing with.

We don't mind it being locked away (probably a good idea in the long run). Also we'd like to be able to capitalise by being able to add to it if possible.

Looking forward to the replies

A credit union account will yield you good dividends. On that sum you could get up to 7-8% per annum. I would pay tribute to you for saving such as sum of money for your children as well as providing from them in every there are not many out there with that kind of money set aside well done

pocketdooz

iMax wrote: »

Guys,

Looking for a little bit of info from those more knowledgeable than me.

My five year old daughter has the above sum in her college fund. We've really skimped for it over the years (started before she was born).

Times are getting harder for us economically & it looks like we won't be able to contribute to it like we were (or at all) for the foreseeable future, but I want to keep it growing if at all possible.

It's currently in an AIB kids account where it ears a meager interest rate.

We were thinking of maybe the state solidarity thing or prizebonds (someone's gotta win, right???). IS there anything else we should look at ? No risk is much preferred (as much as anything can be no risk). I know you don't get as high a return, but it's my daughter's future I'm dealing with.

We don't mind it being locked away (probably a good idea in the long run). Also we'd like to be able to capitalise by being able to add to it if possible.

Looking forward to the replies

For your particular situation, I would recommend putting it into the government 10 year solidarity bond.

40% return after tax over 10 years would mean you would have nearly €20,000 when your daughter is 15 years old.

Can't think of a better simple solution right now.

.

pocketdooz

T Corolla wrote: »

A credit union account will yield you good dividends. On that sum you could get up to 7-8% per annum. I would pay tribute to you for saving such as sum of money for your children as well as providing from them in every there are not many out there with that kind of money set aside well done

Do you really get 7-8% in the credit union?

I dont think so.

.

who what when

+1 on the government solidarity bond.
Safe, secure and good rate of interest

pocketdooz

who what when wrote: »

+1 on the government solidarity bond.
Safe, secure and good rate of interest

One caveat is you must hold it for the full 10 years or it becomes a far less appealing investment as you dont get the full advertised rate and are penalised.

.

iMax

pocketdooz wrote: »

Do you really get 7-8% in the credit union?

I'll be ooking into this as that would be (at a conservative 7%) around €900 per annum !!! :eek:

pocketdooz

iMax wrote: »

I'll be ooking into this as that would be (at a conservative 7%) around €900 per annum !!! :eek:

I think you'll find that's not true.

.

T Corolla

You will not get that kind of return but the sum of money you have invested you will get good dividend return. When I was saving for my house i was getting up to 100 euro's per annum in dividends plus intrest. If you put your money in shares you will earn more but there is always a risk with shares

Cantoris

Well done to those families who are putting some money away now for their childrens' long term education. I hope they appreciate it in time.

Why don't you split the funds between the solidarity bond and something else. Pocket knows his stuff and if he's advising the bond, I'd start with that and then put it in something else too.....just in case you ever need to borrow (!!) the money in the future.

mickman

Xios wrote: »

My advice has no weight what so ever, but heres my two cents, i see saving money long term could yield a loss, because of inflation it'll lose value over time. I'd be more inclined into putting the money into something physical that will hold it's value over the long stretch of time. Perhaps land? Or maybe a piece of farmland for lumber, maybe a certain type of tree that'll take 16 years to be ready for harvest and by then it'd be making a profit. Of course that has it's risks over 16 years and i know nothing of it, it could would be worth the research.
Also what if the euro collapses in that time?

Take the other posters advice over mine, i'm only new to this idea of investments and i've never had any money of my own to spend really, my biggest investment was a motorbike which was 2700 euro.

ur not goign to get much land for 13k

iMax

Thanks for the advice so far guys.

Is it not worth looking at prizebonds ?

T Corolla

Xios wrote: »

My advice has no weight what so ever, but heres my two cents, i see saving money long term could yield a loss, because of inflation it'll lose value over time. I'd be more inclined into putting the money into something physical that will hold it's value over the long stretch of time. Perhaps land? Or maybe a piece of farmland for lumber, maybe a certain type of tree that'll take 16 years to be ready for harvest and by then it'd be making a profit. Of course that has it's risks over 16 years and i know nothing of it, it could would be worth the research.
Also what if the euro collapses in that time?

Take the other posters advice over mine, i'm only new to this idea of investments and i've never had any money of my own to spend really, my biggest investment was a motorbike which was 2700 euro.

Land and property have not been as good value as they are now but there is an abundance of it at the moment and if you were to go down the rental route you would be make a low return but you would still have the property that will rise in value You are correct in saying that money does loose value due to inflation. I think if you were to invest into. I myself would go for the national solidarty bond for the 10yr term or Intel shares. I bought some at $11 in Jan 2009 and there are at 19:20 today.

Xios

T Corolla wrote: »

Land and property have not been as good value as they are now but there is an abundance of it at the moment and if you were to go down the rental route you would be make a low return but you would still have the property that will rise in value You are correct in saying that money does loose value due to inflation. I think if you were to invest into. I myself would go for the national solidarty bond for the 10yr term or Intel shares. I bought some at $11 in Jan 2009 and there are at 19:20 today.

Thanks for the reply, still know very little on the subject, i'll continue to lurk around the forum.

poodles

RRL

x5 by Christmas 2010 Guarnateed*

* not guaranteed

Speculator

How about Coke Cola, its looking very attractive at the moment and should look even better in 10 years time. Plus Warren Buffet is a big fan, so in my opinion you cant go far wrong!

Take a look at this article:

http://www.independent.ie/business/stocks-markets/coca-cola-its-cheap-again-after-a-decade-of-ranging-2250386.html

redroar1942

First thing I'd do in your situation is work out how much she'll need per annum for Uni in 13 years time. At the moment we have only partial fees under the guise of the registration fee which will be close to 2K in most of the Universities this year. On top of that you'll need approx 4-5K per year for rent/books/food/various. The amounts may vary depending on location etc. Worst case scenario you'll need 7K per annum for a minimum of 3 years. No inflation at the moment but hopefully in 3 years time we'll have 2% inflation every year untill she's 18. Roughly it'll be 21K compunded over 10 years would give you €25,998. Registration fee's will go up in the short term so I'd be aiming for the 30K mark myself.

If you stick it in the solidarity bond you should come out with €19,175. I'd go with that myself and try and save a €20 a week in an account with a minum rate of 2% till she's 18. Its more or less risk free and you'll get exactly what you need from it

Apologies if you've done all this already, and I'd say you have, but I did this with a friend recently who's kid wants to be a doctor. Its much worse when you work it out for 6+ years

Brendygg

Hi,

Iv been saving around 200e a week for the last year on aib online savings. Im thinking some of this money might be better invested.

The last few weeks iv been looking at stocks and trying to learn about investing.

I have an inital 5k to invest, im 23 with no ties, so not really worried about loss.

Im thinking of planning my portfolio like this

40% bluechip stocks
40% gold
20% other stocks and silver

What would be my best option regards buying theses?

Bluechip, good broker for these?
Gold, looking at bullion vault and goldmoney, would pert mint be better?
other stocks mostly uk and irish, so thinking of goodbodies or davies.

Also looking at the option of prizebonds too, are they worth it?

Any advice greatly appreciated.

Thanks

carveone

This is all very difficult. In 2006 I would have said Gold! Along with Money Under the Mattress! Now, a long term investment for me is 2 weeks before terror sets in. You could slap your money down on AIB with a trailing stop (a stop is a point at which your broker's computers sell if the stock falls to that point) and then start praying

Two things I'd like to say. Prize Bonds are not an investment. They depreciate at the rate of inflation which over 10 years can be very appreciable (sorry). Worse, they don't appreciate in face value which doubles your loss if you see what I mean.

Eg:
Basic 10 year Irish TBill yield is 5%. Assume inflation of 2%/year and ignore last 10 years :rolleyes: After 10 years NPV yield 63% - 22% = 41% (hope I got that right)

(Still planning on "investing" in a pension where you pay 5% + 1.5% per annum to some blue suited dicks for their incompetence, on the dubious bet that future tax rates will be less than today's? Ahem. Sorry...)

A prize bond's yield after 10 years would be -22%.

National Solidarity Bond is a nice way of saying "we'll pay you less than we pay others on the open market". Aside from the name which brings to mind Samuel Johnson's quote about appeals to patriotism being the last refuge of the scoundrel, the yield is an unutterably appalling 1%, only becoming vaguely rational after a tax free bonus applying to a 10 year lock in. That's a long time.

For the average invester however, it's not a terrible idea. Fire and forget so to speak. However, bear in mind that there are already similar rates available with An Post – the 17th Issue Savings Certificates over 5.5 years is paying 3.53% net per annum (aer).

carveone

While I'm making opinion and in no way disseminating financial advice that would possibly incur a mod's wrath I like to point out that:

- Gold is at an all time high. Not an opinion, more of an observation that these are points that don't necessarily make good investments.

- Equities are at an all time low. Finding a good stock that has been beat into crap has always been a good way of making money (Ask Mr. Buffett). Some things always have long term values regardless of what the market is doing.

Take Alcoa for instance (At $11. I only mention this stock as it's an example and because they are the first of the earning season on Monday. It's not a recommendation!). They make Aluminium since the 1880s. Don't see demand for Aluminium going away any time soon. Um. What else. Bank of America at $14 odd which includes Merrill Lynch for free (heh heh

)

- Pessimism always peaks before a rally. I remember Dow Jones at 7000 on Bloomberg with people screaming in the background. Good days. If I had a time machine, well, I'd be on a beach right now...

Smcgie

carveone wrote: »

While I'm making opinion and in no way disseminating financial advice that would possibly incur a mod's wrath I like to point out that:

- Gold is at an all time high. Not an opinion, more of an observation that these are points that don't necessarily make good investments.

- Equities are at an all time low. Finding a good stock that has been beat into crap has always been a good way of making money (Ask Mr. Buffett). Some things always have long term values regardless of what the market is doing.

Take Alcoa for instance (At $11. I only mention this stock as it's an example and because they are the first of the earning season on Monday. It's not a recommendation!). They make Aluminium since the 1880s. Don't see demand for Aluminium going away any time soon. Um. What else. Bank of America at $14 odd which includes Merrill Lynch for free (heh heh )

- Pessimism always peaks before a rally. I remember Dow Jones at 7000 on Bloomberg with people screaming in the background. Good days. If I had a time machine, well, I'd be on a beach right now...

Good post, in relation to the wrath of mod this is not askaboutmoney

you can give opinions.

mickman

carveone wrote: »

While I'm making opinion and in no way disseminating financial advice that would possibly incur a mod's wrath I like to point out that:

- Gold is at an all time high. Not an opinion, more of an observation that these are points that don't necessarily make good investments.

- Equities are at an all time low. Finding a good stock that has been beat into crap has always been a good way of making money (Ask Mr. Buffett). Some things always have long term values regardless of what the market is doing.

Take Alcoa for instance (At $11. I only mention this stock as it's an example and because they are the first of the earning season on Monday. It's not a recommendation!). They make Aluminium since the 1880s. Don't see demand for Aluminium going away any time soon. Um. What else. Bank of America at $14 odd which includes Merrill Lynch for free (heh heh )

- Pessimism always peaks before a rally. I remember Dow Jones at 7000 on Bloomberg with people screaming in the background. Good days. If I had a time machine, well, I'd be on a beach right now...

equities at an all time low? where did you see this nonsense?

UpAgainToday

Brendygg wrote: »

Hi,

Iv been saving around 200e a week for the last year on aib online savings. Im thinking some of this money might be better invested.

The last few weeks iv been looking at stocks and trying to learn about investing.

I have an inital 5k to invest, im 23 with no ties, so not really worried about loss.

Im thinking of planning my portfolio like this

40% bluechip stocks
40% gold
20% other stocks and silver

What would be my best option regards buying theses?

Bluechip, good broker for these?
Gold, looking at bullion vault and goldmoney, would pert mint be better?
other stocks mostly uk and irish, so thinking of goodbodies or davies.

Also looking at the option of prizebonds too, are they worth it?

Any advice greatly appreciated.

Thanks

Tbh any broker is fine for the amount your going to invest whether its goodbodies davies etc plus no one is going to front run or flash order at this level so you have nothing to worry about

In terms of gold id recommend just buying a gold ETF easier and better

ixus

As the Title says.

tagueule

Hi,

I am starting my final year in college this September. I have a small sum of money approx. 1k and I am considering making an investment. I am willing to take a risk. However, I may need this money in the not so distance future (2-3 years) to help towards paying for a masters, so nothing TOO risky

I have a great interest in getting involved in buying shares so I guess this is a good place to start.

I would really appreciate any advice.

Thanks in advance.

pirelli

These stocks according to Motely fool could yield a profit of up to 8,000 on your initial 1,000. There even better stocks out there. Hopefully some people will make suggestions and you could spread your portfolio into 2 or 3 stocks and might I recommend you get another few hundred euro and open a margin account ( $2000 minimum) and use the Brokers money also. They will double your initial invesment of $2,000 so you can invest up to $4,000 dollars. With the exchange rate it would only be a few hundred more euro. Then you could possibly seriously make money. I would look at shipping and banks also.

Perhaps DRYS and LYG and a bio tech HRBR and a lithium stock ROC or SQM and maybe the Lithium ETF coming out this week also. And perhaps one of the stocks below. Also Sandisk is another good pick and is retreating in share price so an oppourtunity buy might offer itself soon. Also take a gamble on an otc stock small cap for a big 300% gain.

So if you want to actually make some real money then get a margin account and dont be afraid to buy and sell at highs and lows.

IMAX Corporation (Nasdaq: IMAX)
(22.5%) 3-Month Change (%)
12.3 Forward P/E
N/A

Lowe's (NYSE: LOW)
(21.5%) 3-Month Change (%)
12.0 Forward P/E
2.2% Dividend Yield

Verizon Communications (NYSE: VZ)
(10.1%) 3-Month Change (%)
11.7 Forward P/E
7.2% Dividend Yield

Exelon (NYSE: EXC)
(7%) 3-Month Change (%)
10.0 Forward P/E
5.1% Dividend Yield

Activision Blizzard (Nasdaq: ATVI)
(5%)
13.7
1.3%

http://www.fool.com/investing/general/2010/07/15/5-stocks-that-could-make-ordinary-folks-rich.aspx

Saving for retirement is an extremely difficult task. If you're like me, after work, family, and errands, there isn't much time left over to plan for the future. And who really has all that extra cash laying around, just waiting to be invested? I know I certainly don't.

So what's the good news?

You don't need big bucks, recommendations from Wall Street, or hundreds of hours hunched over company financials in order to start saving. All you need is a couple hundred bucks, a little extra time on the weekend, and the realization that investing in individual stocks is both easier and much more lucrative than you previously thought.

Just look around you
With the recent oil spill, looming federal deficits, and financial troubles in Europe, no one would blame you for being fearful of getting into the market. The truth, however, is that many undeserving stocks have plunged, and there's actually a plethora of opportunities out there today.

Legendary investor Peter Lynch always recommended that investors use their common knowledge and buy stocks that they already knew. In his book One Up On Wall Street, Lynch describes his wife's admiration for L'eggs pantyhose, made at the time by Hanes. His wife liked it so much that it forced Lynch to look into the company, invest in the stock, and ultimately, he made six times his original investment.

In actuality, these sorts of opportunities are all around you. Over the last five years, a time in which the general market declined by 10%, you could have made a ton of money, simply by investing in companies that you already knew! Take a look at what would have happened had you invested $1,000 in each of the following companies

priceline.com

Company Details
Online Travel Company

826% 5-Year Return
$1,000 Original Investment
$9,256 Ending Investment

Apple (Nasdaq: AAPL)
Computers, iPods, iPhones
558% 5-Year Return
$1,000 Original Investment
$6,584 Ending Investment

ExpressScripts (Nasdaq: ESRX)
Pharmacy Services
354% 5-Year Return
$1,000 Original Investment
$4,539 Ending Investment

Steven Madden
Apparel & Footwear
235%
$1,000 Original Investment
$3,347

Hewlett-Packard
Computer Products & Services
145%
$1,000 Original Investment
$2,445 Ending Investment

Source: Google Finance; data from 1/7/2005 to 12/31/2009.

Almost everyone has booked a hotel reservation or plane ticket on priceline.com. And I'd be shocked if you've never bought a computer or printer that had the HP label on it. Companies like those and Apple are the obvious ones. If everyone you know has an iPod, an iPhone, an iPad -- then it's almost impossible to not notice the company.

Other times, it takes a savvy eye to recognize a good company. For instance, a few years ago, I should have noticed the convenience and ease at which my mom was ordering her multiple sclerosis medicine by mail. If I had, maybe I would have noticed it was ExpressScripts behind the scenes -- and if I'd made a simple investment of $1,000, I would have quadrupled my money.

So, let's get started!
Now that we've established it's not nearly as difficult to invest as you may have thought, let's take the first few steps. For new or beginning investors, these are the traits I like to see in a stock: a low forward price-to-earnings ratio to ensure good value; a solid dividend yield, and it's always great to find a stock that's trading cheap because of an irrelevant event or a bearish environment. Here are five stocks that I think fit the above criteria:

Stock

IMAX Corporation (Nasdaq: IMAX)
(22.5%) 3-Month Change (%)
12.3 Forward P/E
N/A Dividend Yield

Lowe's (NYSE: LOW)
(21.5%)
12.0
2.2%

Verizon Communications (NYSE: VZ)
(10.1%)
11.7
7.2%

Exelon (NYSE: EXC)
(7%)
10.0
5.1%

Activision Blizzard (Nasdaq: ATVI)
(5%)
13.7
1.3%

Source: Google Finance; data from April 15 to July 14.

Next time your kids are begging you to shell out nearly $20 per person for a movie and some popcorn, know that most likely it's an IMAX theatre they're going to. IMAX has continued to increase revenue this year, in addition to signing 89 new contracts for screens all the way from the U.S. to Russia to Japan. Despite reporting good news time and time again, the stock has been battered down to a pulp, leaving it ripe for you to buy.

How the heck could Lowe's have possibly dropped by 22%?! Sure, unemployment is high and the economic recovery is in doubt, so people are naturally spending less money. But the next time you need a ladder and some fresh paint, chances are it's Lowe's you'll be heading to.

As the leader in wireless carriers, you're probably on Verizon's network (unless you have an iPhone), and most likely you're using one of Verizon's smart phones. In fact, if you're a video gamer, you may have even played one of Activision's games like Call of Duty on a Verizon phone. Activision Blizzard is the largest video game publisher in the world and considering its vast pipeline of new games and past franchises, it's trading at a ridiculously dirt-cheap price.

You may not have heard of Exelon unless you live in southeastern Pennsylvania. That's because this utility provider provides electricity to 1.6 million in PA and over 3 million people in northern Illinois. Because of the BP debacle, it's been lumped in with other energy stocks and has lost ground. But trading at 10 times next year's earnings and paying a fat 5% dividend, this is a truly a stock to love.

The foolish bottom line
Of course there's no guarantee that any of the five stocks above can quintuple in value -- they're just examples of how easy it is to start investing. The point is that anyone can make a sound investment -- all it takes is an observant mind, some extra cash, and the motivation to get started

RATM

Great post Pirelli, especially for us n00bs=)

I agree fully what you say about watching what is going on around you for market trends. I remember living for Australia for a year in 1997. I was amazed at their concept of coffee which hadn't yet hit Ireland (At the time your choice in coffee in Ireland was instant or nothing at all).

I couldn't believe how many different coffees the Aussies were sserving, capucinos, lattes, mochas etc. Then about a year later I was at home and took a job as a bar manager in a swanky new 4 Star hotel. The hotel manager insisted on getting a swanky new coffee machine to make real coffee. When it was being installed I spoke to the tradesman about the price. He said the machines cost 9,000 each- my jaw nearly dropped.

We had a discussion about what it is exactly a coffee machine does (from an engineering perspective). We figuered it does the exactly the same function as a washing machine- it sucks in water, heats it up, throws it around a bit and then spits it back out again (simplified I know but you get the idea). To my mind a coffee machine wasn't that much different that a tumble dryer in terms of functionality yet a coffee machine was costing 9 grand and a washing machine around IR400 punts at the time.

I never really thought too much more about it as I was young and carefree. But then about 5 years later I read about an Irish company who claimed that they sold over 12,000 of these machines in Ireland. Every pub, cafe and even homes were getting swanky coffee machines as a coffee culture hit Ireland throughout the boom. I figure that even if this company was selling machine at 5k they would have had a turnover of over 6 million euro. From that it would be fair to assume that a 3 million net profit was possible from the venture.

Could I have made money from it? Almost certainly- I knew of the trend when I was in Oz and then I saw it continuing when I got home. I could have either looked up coffee machine manufacturers on the markets and invested or I could have starting importing them myself and undercutting the (then) 9k price per machine. Nowadays a coffee machine sold to a pub/cafe costs a hell of a lot less than 9k so there was a lot of money to be made in that market for those with the early mover advantage.

So by just observing what is going on around you money can certainly be made if you're willing to take the risks.

highlydebased

Basically, I'm starting College in September.

Essentially, I wish to invest money for the 4 years I'm in college and have it when I finish. I figured that I could get at least 650 from overdrawing a student account, interest free, and repay it at the end of my course and hopefully have some sort of a profit. Seeing as I have to pay it back it needs to be seemingly low risk.

I've looked at the various products that banks offer and the solidarity bonds etc however the return would not be worth it and others require a large investment.

So what would it be worth my while investing in, and how would I go about it?

offalyman

Hi All,

Hopefully i'm posting in the right place. I've 20000 that i would like to invest, any recommendations on where to put it? Don't really need to be able to access it for a few years but would like to be able to make a little more money than the banks are offering in interest. Any ideas would be appreciated!

Thanks