What to do with €500

jogdish · 08-10-2015 11:26AM #1

Hi,
I will be taking a part time temp job, and will end up earning approx €500. I already have a day job and this is just a once off thing. I have zero debts, and don't feel like buying more crap for myself.

So I have €500 in my hand and I would like to make it work for me - already have a savings/investments accounts, but the interest is depressing. What should I do with my modest amount of one off extra income ?

healthy_cynic · 08-10-2015 01:01PM

jogdish wrote: »

Hi,
I will be taking a part time temp job, and will end up earning approx €500. I already have a day job and this is just a once off thing. I have zero debts, and don't feel like buying more crap for myself.

So I have €500 in my hand and I would like to make it work for me - already have a savings/investments accounts, but the interest is depressing. What should I do with my modest amount of one off extra income ?

how often do you expect to have 500 euro in disposable income to invest ? , unless its every three months , 500 euro is far too small to be worthwhile investing , you will loose a quater of it through fees

if you could manage two hundred quid per month , rabbo direct have investment funds which will allow a minimum investment of that amount

aujopimur · 08-10-2015 01:29PM

Prize Bonds.

Prezatch · 08-10-2015 01:35PM

healthy_cynic wrote: »

500 euro is far too small to be worthwhile investing , you will loose a quater of it through fees

if you could manage two hundred quid per month , rabbo direct have investment funds which will allow a minimum investment of that amount

Terrible advice. You could set up an online stock broking account, and purchase an ETF that would give you coverage of the entire S&P500 (effectively spreading your 500 euro across 500 of largest and most well known companies in the US). The amount of money is too small to invest in individual shares without exposing yourself to risk as it would be difficult to diversify without racking up costs.

It's free to sign up with online stock brokers. Degiro will charge you 2 euro for the privilege of owning an ETF. Downside is keeping your tax affairs in order, search for 'exit tax' in this forum and on askaboutmoney.com investments forum.

Rabo funds have extremely high costs which would negate any gains you make with 500 euro. For the same diversification do it yourself as outlined above instead of paying through the nose to an 'investment manager' in Rabo.

FreeFallin · 08-10-2015 07:39PM

With €500, you could quite comfortably spread bet with IG markets, or a similar competitor. Spread betting can be extremely dangerous but if you educate yourself, you could get a good return.

In short, you can effectively secure a position worth multiples of what you actually need to put down physically. You are then exposed to gains/losses to the value of the full position.

callaway92 · 08-10-2015 07:44PM

No way should somebody starting off be spread betting.

Choose the website with the lowest fees and throw the money onto something low risk.

Or else invest it in Government bonds through your bank.

fits · 08-10-2015 08:04PM

Use it to boost your emergency cash fund and then when you have 2k more in there than you need, buy some shares.

Prezatch · 08-10-2015 08:16PM

I see Healthy Cynic has been banned also. I've noticed quite a few new users being banned when they start posting in investments & markets?

ulinbac · 08-10-2015 09:54PM

Do not spread bet. Too much risk there. Stick in a mutual fund, prize bonds or just in a standard savings account.

arrowloopboy · 10-10-2015 10:49AM

ulinbac wrote: »

Do not spread bet. Too much risk there. Stick in a mutual fund, prize bonds or just in a standard savings account.

Bullsh1t ! Savings account,he'll be on a zimmerframe by the time he'll earn a 100 quid.
Yes agreed ,spread betting can be risky ,so can handling a loaded firearm ,the amount of ''Risk'' is usually correlated with the amount of preparation carried out by the trader/firearm user .
The o/p could pick 10 decent ftse100/250 companies ,trade them on 9mth contracts ,trade them with a 20% trailing gs/l ,that way he's now be trading 2.5k ,and best of all ,he get great education,all for the price of a weekend away:):):).

Forgot to mention ,theirs none of this disgusting ''tax'' stuff to be paid on your profits .

seamusk84 · 10-10-2015 10:53AM

Linked Finance. Linkedfinance.com

You can support Irish business and get a solid return. They are putting up new businesses all the time.

drunkmonkey · 12-10-2015 03:48PM

JoeyD wrote: »

Terrible advice. You could set up an online stock broking account, and purchase an ETF that would give you coverage of the entire S&P500 (effectively spreading your 500 euro across 500 of largest and most well known companies in the US). The amount of money is too small to invest in individual shares without exposing yourself to risk as it would be difficult to diversify without racking up costs.

What kind of return would you be expecting with and ETF and what kind of time frame would you keep it before cashing in? Is it a continuous investment?

I'm just playing around with etoro virtual account since I lost my initial buy in, I've been using the virtual account now a few months and i'm feeling a bit more confident if I bought back in, the social side of it makes it a bit easier for a novice as you can see what some pro's are doing.
Today would have been a good day with Oil, Eur/USD and Ger 30, quick in and out with a 40% + return with a small stop loss. Does the ETF give you the same kind of opportunities.
What i'd ideally like is invest maybe 200 per month in something which is low/moderate risk and my investment to be compounded continuously over the next few years, etoro is straight up gambling, would prefer something safer. What should I be looking at.

Prezatch · 12-10-2015 07:41PM

drunkmonkey wrote: »

What kind of return would you be expecting with and ETF and what kind of time frame would you keep it before cashing in? Is it a continuous investment?

Today would have been a good day with Oil, Eur/USD and Ger 30, quick in and out with a 40% + return with a small stop loss. Does the ETF give you the same kind of opportunities.
What i'd ideally like is invest maybe 200 per month in something which is low/moderate risk and my investment to be compounded continuously over the next few years, etoro is straight up gambling, would prefer something safer. What should I be looking at.

I'd probably recommend you read more around the topic and take it slower, checkout The Intelligent Investor or something. Yes a global ETF would be considered low risk, more suited to someone looking to invest continuously and forget about it. Return depends on the global economy. But really do read up on it, taxes are higher than stocks and losses cannot be netted against gains, two major set backs.

People get burnt thinking they can back Oil or Eur/USD one day and get out making a 40% return...

drunkmonkey · 12-10-2015 08:07PM

What return would you be hoping for a ETF, would 8-12% be dreaming?

13-10-2015 08:28AM

500EUR is rainy day money so just keep it in a deposit account. Don't worry about making it work for you.
If at a later stage you have a few thousand available for investment that you are not likely to have to call on urgently you should consider buying some bluechip dividend shares (at present the oil majors are great value but it will probably be another sector when you come to buy).
Do not touch spread betting, short term trading, managed funds or small cap companies or anything advised in a newsletter.

Prezatch · 13-10-2015 08:55AM

drunkmonkey wrote: »

What return would you be hoping for a ETF, would 8-12% be dreaming?

Like I said, it's world economy dependent. If you had bought an S&P500 ETF at the start of the year you'd be down 3% (taking IUSE as an example)

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1444750200000&chddm=100667&chls=IntervalBasedLine&q=LON:IUSE&ntsp=0&ei=BrgcVsllioGyAbCBkqgM

However if you'd bought it at the start of 2013 and held you'd be up 47%, so 23% annually. Less exit tax 41%

bonyn · 13-10-2015 09:15AM

jogdish wrote: »

So I have €500 in my hand and I would like to make it work for me - already have a savings/investments accounts, but the interest is depressing. What should I do with my modest amount of one off extra income ?

Inflation and the giveaway budget will basically mean your €500 now will probably have the spending power of €480 this time next year.
As for investing.. so you invest, get lucky in your first year and get a 6% return... less tax... offset by inflation. So best case, you're still no better off.
Worse case, stock market crash and you lose over half of it.

Spread betting is terrible advice. The clue's in the name. Might as well stick it on the horses.

My advice would actually be to invest in yourself. Use it to pay for a training course that will increase your earning potential.
Or, invest in a small business. You didn't say how you're earning the 500 so we'll assume it's all above board. If you had your own tools, or better tools, could you earn more money.
If you needed to get a loan for a business, you could use the €500 as a deposit and get a loan for a few thousand. Credit unions do loans at 7% which is considered fairly low.

TheFin · 13-10-2015 06:40PM

Your first (say) thousand should be almost in cash - An Post savings account or bank demand deposit account - you wont get much by way of interest on that because its like you had it in your pocket i.e. emergency money. Next thousand should be invested somewhere its harder to turn into cash and that will pay better interest and so on.

el diablo · 19-10-2015 06:13PM

aujopimur wrote: »

Prize Bonds.

I assume this is a joke?

Frogdog · 19-10-2015 08:30PM

Pay off any debt if you have any, after that, keep it as an emergency fund somewhere where it is readily accessible.

It's too small to invest with. 500 a month - possibly. 500 once off - futile.

newacc2015 · 19-10-2015 08:38PM

bonyn wrote: »

Inflation and the giveaway budget will basically mean your €500 now will probably have the spending power of €480 this time next year.

My advice would actually be to invest in yourself. Use it to pay for a training course that will increase your earning potential.
Or, invest in a small business. You didn't say how you're earning the 500 so we'll assume it's all above board. If you had your own tools, or better tools, could you earn more money.
If you needed to get a loan for a business, you could use the €500 as a deposit and get a loan for a few thousand. Credit unions do loans at 7% which is considered fairly low.

We have no inflation at the moment. Its literally around 0.2% at most. Not the 4% rate which you are implying

Training courses are pointless. The best thing you can do is buy a subscription to wsj.com or ft.com. You can learn the trends of tomorrow today. Irish training courses are stuck in the mid 1990s. I literally had 1 college module which was in anyway relevant to any period after 2010

newacc2015 · 19-10-2015 08:38PM

bonyn wrote: »

Inflation and the giveaway budget will basically mean your €500 now will probably have the spending power of €480 this time next year.

My advice would actually be to invest in yourself. Use it to pay for a training course that will increase your earning potential.
Or, invest in a small business. You didn't say how you're earning the 500 so we'll assume it's all above board. If you had your own tools, or better tools, could you earn more money.
If you needed to get a loan for a business, you could use the €500 as a deposit and get a loan for a few thousand. Credit unions do loans at 7% which is considered fairly low.

We have no inflation at the moment. Its literally around 0.2% at most. Not the 4% rate which you are implying

Training courses are pointless. The best thing you can do is buy a subscription to wsj.com or ft.com. You can learn the trends of tomorrow today. Irish training courses are stuck in the mid 1990s. I literally had 1 college module which was in anyway relevant to any period after 2010

Chancer3001 · 21-10-2015 03:45AM

Just keep the 500 in your current account.

Something unexpected will arise.

A weekend at a wedding with a date would cost you most of that.

FRI Investments · 02-12-2015 11:45PM

FreeFallin wrote: »

With €500, you could quite comfortably spread bet with IG markets, or a similar competitor. Spread betting can be extremely dangerous but if you educate yourself, you could get a good return.

In short, you can effectively secure a position worth multiples of what you actually need to put down physically. You are then exposed to gains/losses to the value of the full position.

I used to work in the spread betting industry and the chances of blowing the whole €500 in a short period of time is quite high. Scratch card's offer better odd's for someone who is new to margin trading.

Stick the €500 under the mattress or in a account where you can access it easily and not be tempted into trading high leverage. As a lot of people said Rainy day fund.

@jogdish Great debate starter.

K.P. Egan · 02-12-2015 11:50PM

Buy some Bitcoin.

simdan · 02-12-2015 11:52PM

You could go to a casino and put it all on black. It works just less than 50% of the time for me..

K.P. Egan · 26-12-2015 04:39PM

Well i hope you took my advice that i gave you on 02-Dec-2015
Scroll down to see bitcoin chart for dec 2015
coingecko.com/en/price_charts/bitcoin/eur/30_days

lcwill · 27-12-2015 06:00PM

Buy 50 books about business and investing

lanos · 28-12-2015 01:21PM

K.P. Egan wrote: »

Well i hope you took my advice that i gave you on 02-Dec-2015
Scroll down to see bitcoin chart for dec 2015
coingecko.com/en/price_charts/bitcoin/eur/30_days

bitcoin is a classic pyramid scheme

stay well clear of it

alb · 28-12-2015 04:56PM

lanos wrote: »

bitcoin is a classic pyramid scheme

Incorrect, however it is a new technological experiment and is highly speculative and is probably not what OP is looking for.

lanos · 28-12-2015 05:54PM

Pyramid scheme in my opinion
Not a pyramid scheme in your opinion
We'll leave it there

What to do with €500

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