Advice for a young guy with disposable income

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Newcash11

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Cards on the table here, I’m a 24 year old doctor living at home for at least the next year. Very minimal expenses. Currently I have about €3,000 a month marinating in a credit union account.

i’ve no previous investing experience, I met with an AIB financial advisor re the fusion funds. However after coming here I decided to pump the breaks on that.

I’ve learned enough from this website to max out the pension, but with 40+ years ahead of me, that still leaves me with a lot to play with.

Now I’m obviously aware that family and mortgage and life in general expenses are ahead of me and not behind me.
So with those future costs in mind, is there’s any advice out there for financial growth at my age?
 
FintanJ said:
What are your financial objectives next 10 years?
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Loosely, to own my own property, maybe considering a second (but that might be naive, I don’t know enough to say). Have a somewhat diverse investment portfolio - probably the main thing I’m here asking guidance for. And to have a solid bed of savings that can cope with wedding, childcare expenses etc that’ll crop up in my 30’s
 
You could start by depositing some of your cash elsewhere to get a better interest rate.
Check out Raisin.ie
 
Your posts seem a bit confusing and lacking in detail to me.
E.g. you say "3K p.m." but you don't actually say what your current total savings are.
And your medium/long term goals and priorities are a bit unclear to me.
You would probably be better off posting a Money Makeover in order to get more informed feedback.

Money makeover

Budgeting and dealing with debt moved to Mortgage Arrears and Debt Forum .
www.askaboutmoney.com
 
What specialty are you planning? Big difference between timelines and costs for say GP versus neurosurgery.
 
ClubMan said:
Your posts seem a bit confusing and lacking in detail to me.
E.g. you say "3K p.m." but you don't actually say what your current total savings are.
And your medium/long term goals and priorities are a bit unclear to me.
You would probably be better off posting a Money Makeover in order to get more informed feedback.
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You might be right, I haven’t discovered all the nooks and crannies of the site yet, so thanks for pointing that out, I’ll definitely have a look.
To answer some of your points. I’m starting from almost 0, having started work in July, I have just short of 10,000 between current and savings account. My overall goals are coming from no financial background, wondering how best to grow assets, even though I know, I’ll have some big expenditure to deal with (a home) so I can’t lock everything away into the pension or some other very long term strategy.
 
arbitron said:
What specialty are you planning? Big difference between timelines and costs for say GP versus neurosurgery.
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It’s going to be hospital based. Meaning higher earning potential in my late 30’s and onward, but I won’t get the early return that a young GP gets
 
Hospital based doesn't tell us a lot, could be pathology, GIM, ENT... all very different costs and 10-year outlooks. Anyway, you should consider costs of research years OOP where the salary can dip significantly, as well as costs associated with moving around the country or going abroad for fellowship(s), etc. Some specialties you will spend 5 figure per year on courses some years.
 
arbitron said:
Hospital based doesn't tell us a lot, could be pathology, GIM, ENT... all very different costs and 10-year outlooks. Anyway, you should consider costs of research years OOP where the salary can dip significantly, as well as costs associated with moving around the country or going abroad for fellowship(s), etc. Some specialties you will spend 5 figure per year on courses some years.
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While the earning potential at the end of those roads are different, the next 10 years look reasonably similar in all of them, financially speaking anyway. Maybe it might be simpler to reduce this whole idea to 5 years. Before any fellowship, or other big career variations.
To simplify this whole post, feel like putting 30-50k per year into a deposit account for the rest of my 20’s is not prudent. What would you wise folk do with that in my position?
 
Newcash11 said:
post, feel like putting 30-50k per year into a deposit account for the rest of my 20’s is not prudent.
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If it’s what you want then it’s feasible for you to buy a property in the next three years. You will have the earning power and deposit.

If home purchase is your goal then keep everything in cash, and seek the highest interest rate. There is greater expected return but also too much risk with other products. Heavy cash saving is also a good signal to lenders.
 
Newcash11 said:
I’ve learned enough from this website to max out the pension,
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No, you should not be investing in a pension.

Your first priority is to build up the deposit to buy your own home.

As that is still a few years away, you should be investing in the stock market. It will go up and down but overall it should rise over the next 5 years or so that you will be investing for.

When you get close enough to the deposit to buy a house, then you should switch to cash to avoid any sudden falls.

After you have bought your house, and got your mortgage down to a comfortable level, then start contributing to the pension.

The downside of this strategy, is that you can get 40% tax relief on pension contributions now. But that might not always be the case. The tax relief could be reduced to 20% at some stage which would cause you to regret not having maxed your pension contributions.

However, I think that as your overwhelming priority is to buy a house as soon as possible, then I think you should take this risk.

Brendan
 
Brendan Burgess said:
No, you should not be investing in a pension.

Your first priority is to build up the deposit to buy your own home.

As that is still a few years away, you should be investing in the stock market. It will go up and down but overall it should rise over the next 5 years or so that you will be investing for.

When you get close enough to the deposit to buy a house, then you should switch to cash to avoid any sudden falls.

After you have bought your house, and got your mortgage down to a comfortable level, then start contributing to the pension.

The downside of this strategy, is that you can get 40% tax relief on pension contributions now. But that might not always be the case. The tax relief could be reduced to 20% at some stage which would cause you to regret not having maxed your pension contributions.

However, I think that as your overwhelming priority is to buy a house as soon as possible, then I think you should take this risk.

Brendan
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Thank you Brendan. This is hugely helpful. I was wondering how my age and pre house scenario factored in to all this. Now I have my answer.

Appreciate it!
 
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