Retired Couple - Losing savings to inflation

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Barney 123

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Couple - late sixties
Combined pensions - €4,100 per month
3 adult children - contributed to their mortgage deposits

No debt or mortgage
Savings €300,000 in post state savings
Question: What to do to conserve value of savings?
 
Barney 123 said:
Couple - late sixties
Combined pensions - €4,100 per month
3 adult children - contributed to their mortgage deposits

No debt or mortgage
Savings €300,000 in post state savings
Question: What to do to conserve value of savings?
Click to expand...
Hi Barney.
Maybe one of the replies you got to date is from somebody living in mammys box room complaining about house prices etc.
Late sixties at least one of you have at least 15 years to go.
300k a substantial amount of hard earned cash.
Firstly if you are both content living on 4100pm great stuff. Happy days. I am 60 married and could live well on that.
Now I think you know the next part.
Get out of the state savings and even if you need a little help get your 3.5% with raisin. No dirt tax for your age.
Any better return involves risk something you may or may not wish to consider.
Happy health dont stress.
 
I wasn't going to respond to this, but I share similarities. Trying to beat inflation is like trying to stop day going into night. Most likely, for us mere mortals it cannot be done, but you can take steps to reduce the worst impact of inflation. Investing in your late 60's is likely also folly and worse again stressful..

Ordinary cost of living in Ireland is expensive. Electricity is dear, so is gas, petrol, internet and almost everything else. Move to Spain or Portugal or Italy for twelve weeks over the colder months and you can live much cheaper. OK! - You have to pay for flights, transfers, accommodation rental. When abroad you live cheaper depending on your lifestyle. Electricity is not cheap on the continent, but you use a hell of a lot less. Neither do you drive as much as you would in Ireland (optional). Wine, beer etc are a fraction of what you would pay in Dublin. If you smoke you're into huge savings immediately.

Book your cheaper flights as early as you can after booking accommodation. You're not going on holidays - you're just temporarily changing your lifestyle for a while and all the sunshine is bonus. You don't have to stay in the dearest areas and good (centrally located) accommodation costs €900 per month with internet, electricity, refuse, cleaning, water charges included. You can get cheaper, but , , , Figure out a way to make it work for you (and that ain't too difficult) and suddenly you're in clover (well, competing with and not giving into inflation for a change). And when you wake up every morning you can read your brains out, surf the net, walk til you drop and hey! live in shorts and tee shirts while most nearly freeze in Ireland.

Alternative:- Carry on as is . . .
 
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If you want to beat inflation, you have to invest in the markets. That means exposing some of your money to the ups and downs of the market. In the short term, volatility is greater but over the longer term, it should smooth out and you should beat inflation. You need to give your investments at least 5 years. And always keep a decent amount of cash on hand for spending.

If you are not comfortable with this, accept your money on deposit will not beat inflation.

Do not invest in one of these structured products that promises stock market returns with the security of a deposit. That is not how markets work, so there is something wrong. There is a very good chance you don't get any market returns and someone uses your money over 5 years to make money for themselves and you just get a return of your capital.


Steven
www.bluewaterfp.ie
 
ClubMan said:
I presume you mean tracker bonds or the like? Are they still being sold? :oops:
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I was offered the Dynamic 95 Protected Bond 26 earlier this year by BOI- very like this older one from 2016

The newer one offered 100% capital protection - still called it Dynamic "95" as they're too dumb to understand their own naming convention.

30% maximum return over 5 years 11 months - before tax of course. Best case you end up only marginally ahead of higher interest rate deposit accounts - which is definitely not worth the risk of not beating deposits and the restrictions on accessing the investment before the end of the 6 year period. The 100k government guarantee also disappears for anyone moving their savings into these products.

They don't seem to advertise these products online at least - they push them one to one. Protects them from public analysis and allows them to pretend they're exclusive products - I was told my one was closing soon so you'll need to get in quickly!
 
ClubMan said:
I presume you mean tracker bonds or the like? Are they still being sold? :oops:
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They never went away. They are big business. Especially with inflation so high, people who traditionally keep their money in cash are now looking for a return but are nervous about market volatility. Prime targets for those selling these products.
 
Leper said:
I wasn't going to respond to this, but I share similarities. Trying to beat inflation is like trying to stop day going into night. Most likely, for us mere mortals it cannot be done, but you can take steps to reduce the worst impact of inflation. Investing in your late 60's is likely also folly and worse again stressful..

Ordinary cost of living in Ireland is expensive. Electricity is dear, so is gas, petrol, internet and almost everything else. Move to Spain or Portugal or Italy for twelve weeks over the colder months and you can live much cheaper. OK! - You have to pay for flights, transfers, accommodation rental. When abroad you live cheaper depending on your lifestyle. Electricity is not cheap on the continent, but you use a hell of a lot less. Neither do you drive as much as you would in Ireland (optional). Wine, beer etc are a fraction of what you would pay in Dublin. If you smoke you're into huge savings immediately.

Book your cheaper flights as early as you can after booking accommodation. You're not going on holidays - you're just temporarily changing your lifestyle for a while and all the sunshine is bonus. You don't have to stay in the dearest areas and good (centrally located) accommodation costs €900 per month with internet, electricity, refuse, cleaning, water charges included. You can get cheaper, but , , , Figure out a way to make it work for you (and that ain't too difficult) and suddenly you're in clover (well, competing with and not giving into inflation for a change). And when you wake up every morning you can read your brains out, surf the net, walk til you drop and hey! live in shorts and tee shirts while most nearly freeze in Ireland.

Alternative:- Carry on as is . . .
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When I grow up I want to be Leper.
 
Nost sure if this is relevant on this thread (mods feel free to cut and/or paste) but there are good inflation savers inbuilt:- We've just returned to Ireland after spending 10+ weeks in Andalucía. I don't often keep a daily journal of money spent and time used but here goes:-
1. General Groceries/Food - Easily 11% cheaper than our Irish equivalent (We didn't use Kelloggs Cornflakes or Nescafe Coffee etc; using the Spanish equivalent though). Supermarket Delivery costs €6.00 but charge is waived fully if you spend €100.00 - Free Delivery and a strong young lady arrives with a battery powered hand-cart which easily brings stuff up steps.
2. Tap water is undrinkable except after being boiled to make tea/coffee. Drums of water were the elephant in the room; we wouldn't have been buying these in Ireland. But, with free delivery and us not having to carry them up steps no complaints from me.
3. The likes of Pataks jar curry sauces would be dearer in Spain, but again use some other form of curry. If you are tied to Irish/English brands such groceries are dearer.
4. Wine:- The Spanish wouldn't be seen dead drinking the stuff we buy in Ireland for a tenner. It retails there for around €1.00 per bottle. But, pay €3.25 for a bottle of wine and you're purchasing wine that would easily cost in excess of €25.00 per bottle in Ireland.
5. I swim every day so I took out 120 day membership for the local heated indoor municipal swimming pool. Use of sauna and other facilities were included. I did have to buy a small padlock for the clothes locker (€2.00). I used the pool 6 days per week minimum;
6. Mrs Lep started a friendship with one of our Spanish neighbours. She was a cook in a local restaurant. I gave her daily instruction in English in exchange for her instruction in Spanish (my Spanish was better than Improvers Level beforehand). This took about 45 minutes per day. She also showed us how to cook proper tapas and other Spanish food. Effectively, she was a godsend and we'll be renewing our acquaintance next September for our next long stint there. Mrs Lep went from Beginners Spanish to Beginners Spanish (just had to get that in as Mrs Lep is an expert in everything). My Spanish came on a ton, I kid you not!
7. I joined a local Walking Club (free, but no point showing up without proper walking shoes) and walked with them twice per week. Minimum Walk 10 kms and over ground 100% rough, desert, rocky, stony and trying. My main objective this visit was to maintain my weight level having lost in excess of 4 stone. Hey! - I returned to Ireland a half stone lighter than my arrival in Spain. Each walk including stop in a Spanish eatery for tapas was easily 4.5 hours start to finish. I'll elaborate on such walks in another thread sometime.
8. We have all the Irish television channels and on internet radio and I was able to listen to Marty-in-the-Morning (even better when it was George-Hamilton-in-the-Morning). So we were able to keep abreast of news in Ireland. Free Online newspapers helped too. I'd read everyday too; The Irish RM being my most popular read this time - read it 3 times along with preparing for my "Spanish Lesson" through my Spanish Grammar books.

Summary:- All-in-All we spent much less money than we would have in Ireland. We didn't have our car (inconvenient but savings on petrol!!!). We used much less electricity. Public transport costs €1.20 per trip (included transport to nearby towns). We lived more healthy and in all the weeks we were there perhaps we had 4 hours rain? It was windy some days and there were some nights when it was necessary to turn on the heating.

We were at Mass yesterday (Sunday) in Cork after which the amount of people we met who wished they could spend some of the colder months away as we did was staggering, but they all had reasons why they couldn't e.g. Who'd cut the grass? - I couldn't visit my grandkids! - I'd miss the league games - I wouldn't know how to spend my time there - Who'd mind the dog our son-in-law inflicted upon us?. Again I'm more than toying with bringing the car to Spain next February, but it's still early days.
 
That sounds very attractive

It’s not feasible for us at the moment as we are both still working and I’ve elderly parents who need support but longer term it’s our plan. We had envisaged buying abroad but renting sounds more attractive.
 
Sounds amazing! Have you considered bringing your car over if going for such a long stint? Rosslare to Bilbao then drive to your destination? Though it sounds as if you don't really need it and can manage without.
 
We had meant to bring the car on this visit, but our departure date had come outside of our control and therefore could not book the ferry until their prices skyrocketed. Also, we had Ryanair vouchers which were nearing their expire date and made air travel more convenient. Next year though I’ll think about taking the car again. A car is very handy but not necessary.
 
Leper said:
4. Wine:- The Spanish wouldn't be seen dead drinking the stuff we buy in Ireland for a tenner. It retails there for around €1.00 per bottle. But, pay €3.25 for a bottle of wine and you're purchasing wine that would easily cost in excess of €25.00 per bottle in Ireland.
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While wine is far cheaper in Spain it's not that much cheaper.
A bottle that costs €3.25 is Spain will cost around €10 here. If you pay €3.25 in Spain you're still getting cheap table wine. The Duty on wine here is €3.19. Out VAT rate is 23%, theirs is 21%. We have at least one extra link in the distribution chain which adds cost. Our wages and fixed retail costs are far higher so the retailer has to add a bigger mark up to cover those costs. That's what accounts for the difference.
 
Barney 123 said:
Couple - late sixties
Combined pensions - €4,100 per month
3 adult children - contributed to their mortgage deposits

No debt or mortgage
Savings €300,000 in post state savings
Question: What to do to conserve value of savings?
Click to expand...
You have an income of €946 a week with no mortgage and no dependents. Well done. You don't needs lots of savings. Travel, eat out, buy a sports car. Enjoy yourself. You'll be a long time dead and the graveyards are full of rich corpses. You probably have another 10 years or so where you are both healthy and mobile enough to really enjoy spending it. It may or may not have been hard earned but it's your money so spend it.
 
Leper said:
We were at Mass yesterday (Sunday) in Cork after which the amount of people we met who wished they could spend some of the colder months away as we did was staggering, but they all had reasons why they couldn't e.g. Who'd cut the grass? - I couldn't visit my grandkids! - I'd miss the league games - I wouldn't know how to spend my time there - Who'd mind the dog our son-in-law inflicted upon us?.
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I love it. :)
 
@Purple said:- "A bottle that costs €3.25 is Spain will cost around €10 here. If you pay €3.25 in Spain you're still getting cheap table wine."

1. That is not true (I'm definite on what I said).
2. Pay €3.25 for a bottle of wine in Andalucia does not indicate it's below par wine and also you won't get a bottle of same for a tenner in Ireland.- Usually it's pretty good. I do agree the price in Irish terms is cheap though. I'll gladly go through any Irish wine store with anybody here to prove my points.
 
As for the cheap wine in Spain you can blame the Irish government for that, high alcohol taxes and now MUP. I heard that the MUP price is up for review within a year. Obviously that means raising the MUP price again.This must be resisted enough of this imposing costs by unelected bureacrats
 
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