# State Savings - 40/50k for 10yrs



## tosullivan (16 May 2019)

Looking at this at moment, just want somewhere risk free with moderate returns for next 10yrs on 40-50k

I have a bit in stocks so covered there

Put in the numbers on their calculator online for 50k for 10ys
Return is 8k on the 50k, is there dirt charged on that?

Thanks


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## adox (16 May 2019)

No dirt on state savings.


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## Logo (16 May 2019)

Just googling Irish inflation calculator (http://www.hargaden.com) indicates that "€50000 in 2008 was worth about €49965.47 in 2018."
The CPI inflation calculator (www.cso.ie) for €50K during that same 10 year period shows that "A basket of goods and services that cost €50,000 in Apr 2008 would have cost €50,703.56 in Apr 2019."

Based on those figures a return of €8K with no dirt charges appears attractive.


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## RedOnion (16 May 2019)

Logo said:


> that same 10 year period


Except you are using 11 years...


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## Logo (16 May 2019)

RedOnion said:


> Except you are using 11 years...


Fair enough  but I expect that you can plug in the same figures and get almost the same result over a ten year period.


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## Logo (16 May 2019)

If you invested €45K in 5.5 year savings certs in Nov 2012 you would have a gain of €9,450 by May 2018. I'm sure the return would have been much better with the 10 year product.


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## RedOnion (16 May 2019)

Logo said:


> Fair enough  but I expect that you can plug in the same figures and get almost the same result over a ten year period.


You get exactly the same result, because both calculators are looking at the same CSO CPI data.



Logo said:


> I'm sure the return would have been much better with the 10 year product.


Yes, the 1st launch in April 2010 paid 50% after 10 years.

But we're gone way off topic.

Interest rates were a lot higher back then.


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## Logo (16 May 2019)

I fail to see why the thread has gone "way off topic". The OP stated a return of 8k on 50k over 10 years. I simply replied with CPI figures for the past years and compared future returns with those available previously.


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## RedOnion (16 May 2019)

Logo said:


> I fail to see why the thread has gone "way off topic".


Question: "is there DIRT charged on that?"
Answer: Over the last 10 year, the rate of inflation was..

Bang on target. Now he just needs a time machine to travel back to 2008.

*Edit*: apologies for tone of the above - maybe you saw a relevance that I don't, and I think it could confuse the matter.
Past interest / inflation rates, while interesting to look at, are of no relevance in making a financial decision now. The returns available before aren't available now, and nobody knows how inflation is going to pan out.
The best available risk free return available to an Irish resident, assuming they have no debt, are state savings. They provide a return in excess of 1% per annum above what government debt is yielding in the markets. They also have an in built calculation of early redemption, so if interest rates suddenly shoot up to 5% per annum, you can take your money back.


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## NoRegretsCoyote (16 May 2019)

Logo said:


> Just googling Irish inflation calculator (http://www.hargaden.com) indicates that "€50000 in 2008 was worth about €49965.47 in 2018."
> The CPI inflation calculator (www.cso.ie) for €50K during that same 10 year period shows that "A basket of goods and services that cost €50,000 in Apr 2008 would have cost €50,703.56 in Apr 2019."
> 
> Based on those figures a return of €8K with no dirt charges appears attractive.



It's unreasonable to assume that consumer prices over the next ten years will be as low as the last ten years.

Ireland faced a unique set of economic circumstances that has kept inflation low. I wouldn't expect them to be repeated.

Ireland is still part of the euro area, and the ECB has an inflation target of close to 2% per annum.

I would expect a return to inflation somewhat as normal sometime soon.


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## jpd (17 May 2019)

NoRegretsCoyote said:


> I would expect a return to inflation somewhat as normal sometime soon.



This has been the standard remark for the last 10 years or so but it isn't anywhere near what has been priced into the market price of euro bonds - but it will eventually come to pass, so … (it's a bit like fusion energy, it's always just 10 year or so away and has been for the last 50 years)


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## Laramie (18 May 2019)

I have quite a sum of money in State Savings. Looking at the awful returns on the 3 year and 5 year products I decided not to reinvest a sum of money that was maturing from them. I was actually looking at the list of accounts that I have with maturing dates in to the 2020's and wondered what in God's name am I doing.
Instead I topped up on a high yielding dividend share that returns just over 5% per annum.  I know that the price of this particular share fluctuates but I have had a holding in them for over 20 years and I am happy to do so with a little bit of risk.
We had thought of becoming landlords but we are of the age where we don't need the hassle. We had thought of a Spanish holiday home purchased in one of our adult children's names but there was no guarantee that all the family would use it.
So we have decided to spend the dividends on renting someone else's holiday home and generally up our daily spend on enjoying ourselves.
The thoughts of putting more money in State Savings for long periods is kind of depressing. I am however very grateful for everything that I have and appreciate that others haven't been so lucky. Having said that, everything I have has been hard earned, with some risk taking over the years. So tosullivan, have you thought of just spending it?


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## Brendan Burgess (18 May 2019)

tosullivan said:


> just want somewhere risk free with moderate returns for next 10yrs on 40-50k



There is no such thing. 

The Irish Exchequer is way overborrowed. I think that it will last another 10 years, so you should get your money back. But you might not. 

If you are a public servant with your income coming from the government, you should definitely diversify away from it as the guarantor of your savings as well. 

In any event, you should not tie up your money for 10 years. Your personal circumstances may change or the investment landscape may change.

Brendan


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## noproblem (18 May 2019)

Is it the country as a whole you expect to last for another 10 years or the low interest rates


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## RedOnion (18 May 2019)

Brendan Burgess said:


> In any event, you should not tie up your money for 10 years. Your personal circumstances may change or the investment landscape may change.


The funds are accessible at 7 days notice at any time during the 10 years.


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## Brendan Burgess (18 May 2019)

RedOnion said:


> The funds are accessible at 7 days notice at any time during the 10 years.



I had forgotten that. 

But even still, isn't that a severe penalty in terms of lost interest? 

Brendan


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## RedOnion (18 May 2019)

Yes, return is dismal if you cash out in first 5 years, but it's not as bad as a fixed deposit with a bank @Brendan Burgess 

You always get 100% of you're money back, and the amount of interest you receive is pre determined before you start. Banks will refuse to allow access if they can't charge a break fee.


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## Bettyk (26 May 2019)

Laramie said:


> I have quite a sum of money in State Savings. Looking at the awful returns on the 3 year and 5 year products I decided not to reinvest a sum of money that was maturing from them. I was actually looking at the list of accounts that I have with maturing dates in to the 2020's and wondered what in God's name am I doing.
> Instead I topped up on a high yielding dividend share that returns just over 5% per annum.  I know that the price of this particular share fluctuates but I have had a holding in them for over 20 years and I am happy to do so with a little bit of risk.
> We had thought of becoming landlords but we are of the age where we don't need the hassle. We had thought of a Spanish holiday home purchased in one of our adult children's names but there was no guarantee that all the family would use it.
> So we have decided to spend the dividends on renting someone else's holiday home and generally up our daily spend on enjoying ourselves.
> The thoughts of putting more money in State Savings for long periods is kind of depressing. I am however very grateful for everything that I have and appreciate that others haven't been so lucky. Having said that, everything I have has been hard earned, with some risk taking over the years. So tosullivan, have you thought of just spending it?



Im intrigued to who the shares are in!!


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## Niall-1980 (26 May 2019)

Heres your Brother Brendan I too am curious. Id take 5% with minimal risk all day


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## Laramie (29 May 2019)

Bettyk said:


> Im intrigued to who the shares are in!!


I am not allowed under AAM rules to name specific shares. However if you Google High Yielding Ftse 100 shares you will get an idea. The nice thing about this share is that it pays a dividend 4 times a year rather than just twice.


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## noproblem (29 May 2019)

Laramie said:


> I am not allowed under AAM rules to name specific shares. However if you Google High Yielding Ftse 100 shares you will get an idea. The nice thing about this share is that it pays a dividend 4 times a year rather than just twice.



It's possible the moderator might allow an exception in this case.


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## RedOnion (29 May 2019)

There is no such thing as 5% return with 'minimal risk'. The poster is either willing to accept, or doesn't fully understand, the risks involved.

There are lots of equities with 5% dividend yield. There's no point in discussing a specific one.


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## Niall-1980 (29 May 2019)

RedOnion said:


> There is no such thing as 5% return with 'minimal risk'. The poster is either willing to accept, or doesn't fully understand, the risks involved.
> 
> There are lots of equities with 5% dividend yield. There's no point in discussing a specific one.



If its all the same to you id still like to know what specific share the poster is talking about.


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## Brendan Burgess (29 May 2019)

Niall - please read the  https://www.askaboutmoney.com/threads/posting-guidelines.191252/


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## Bettyk (30 May 2019)

Laramie said:


> I am not allowed under AAM rules to name specific shares. However if you Google High Yielding Ftse 100 shares you will get an idea. The nice thing about this share is that it pays a dividend 4 times a year rather than just twice.


 Sounds good Laramie!!


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## Niall-1980 (30 May 2019)

Brendan Burgess said:


> Niall - please read the  https://www.askaboutmoney.com/threads/posting-guidelines.191252/



Ahh I see it know. Sound as a bell I understand.


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## IgniteMyFire (28 Jun 2019)

Investing in a low fee index fund ETF would get you 5% - 6% per year as a long-term investor. But as RedOnion said, there is no such thing as 5% return with "minimal risk", there is always risk involved when investing. An index fund ETF does spread the money over multiple stocks though which should reduce the risk.


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## Daddy Ireland (5 Jul 2019)

No Problem.
The share that pays a dividend I think is fairly obvious.  Think of the black stuff .


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## Tintagel (6 Jul 2019)

Looking at the stock markets upwards and upward rise on a daily basis, I am of the opinion that there has to be a correction soon. I cashed in my shares a few weeks back and I am sitting on a pile of cash waiting to buy back in, when it happens.
Those of you who held off are doing well. But a profit is a profit and there is always a time to buy and a time to sell.

Those of you who shorted Bitcoin but didn't take their profit when they dropped toward $3k will know what I am talking about. Could have...should have.....


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