# Looking to invest



## siofrahd93 (31 Jan 2021)

Hi, 

this is kind of a two pronged question. 
1) I have 10 thousand and I'm looking to invest - I'm okay with this being long term as I'd like it to go for a deposit for a house. I'm looking at putting it into a savings investment with a bank. Is there any banks that do this better than others or would a different option be better again? So far I've looked at Bank of Ireland and EBS. I'm happy to go with 15 year investment - the projections for a bad return on BoI are not too bad, but I'm aware that the banks would want to advertise themselves as being relatively reliable so I don't know to what extent I can trust them.

2) I'm interested in starting to buy shares with small amounts of disposable income I have now. This would be very small, more like 50 euro a week, but maybe up to 200 very occasionally. I'm not naive enough to think I'll get big returns, if any, but I'm doing some research now and want to know if there is benefits to buy small amounts of shares and hopefully make small profits from time to time. I registered with Degiro, and my account still needs to be processed. Is there any advice for someone starting out & starting small?


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## RedOnion (31 Jan 2021)

Firstly, 'the banks' don't actually create these products.  They're just Brokers for life companies.
The EBS product is Irish Life (AIB group are tied agents of Irish Life).
The BOI one is New Ireland (New Ireland is a subsidiary of BOI)

You could go to a broker that deals with all the life assurance companies, and will find the best fit for you, in terms of risk / fees.  They will have access to the same products as the banks, plus many more.

Personally, I'd be using the 10k to invest in shares, and the life product to save the 50 per week.  They look after all the administration and tax for you.  Or by putting in a lump sum, you'll end up with lower charges on the life savings product.

With life products there's a 1% Government levy on all investments.  Any gains are taxed at 41%.  And the fees can be high, but take a bit of time to actually work out what you're paying.

There are lots of threads about life products if you have a look through the forum to inform yourself.

You haven't provided enough information to make any kind of recommendations around investment types suitable for you.


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## siofrahd93 (31 Jan 2021)

RedOnion said:


> You haven't provided enough information to make any kind of recommendations around investment types suitable for you.


What information would be relevant to give recommendations? 
I'm 27 and in my final year of college, looking to work in an industry where I will likely be freelance, and probably not earning loads. My work is heavily affected by covid and will be the last to open up so I want to focus on making the best financial decisions now so that I can hopefully not worry too much about house prices and pension in the future.


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## Younginvestor93 (1 Feb 2021)

Degiro and putting a lumpsum in and purchasing a diversified ETF would be a good choice. You will have to pay 41% tax on profits when you sell however or after 8 years have passed. Likely it will have grown over the 8 years and you will have that little bit extra available with you when purchasing the house.


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## _OkGo_ (2 Feb 2021)

siofrahd93 said:


> What information would be relevant to give recommendations?
> I'm 27 and in my final year of college, looking to work in an industry where I will likely be freelance, and probably not earning loads. My work is heavily affected by covid and will be the last to open up so I want to focus on making the best financial decisions now so that I can hopefully not worry too much about house prices and pension in the future.



The information laid out here would help you get better opinions





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siofrahd93 said:


> 1) I have 10 thousand and I'm looking to invest - I'm okay with this being long term as I'd like it to go for a deposit for a house. I'm looking at putting it into a savings investment with a bank. Is there any banks that do this better than others or would a different option be better again? So far I've looked at Bank of Ireland and EBS. I'm happy to go with 15 year investment - the projections for a bad return on BoI are not too bad, but I'm aware that the banks would want to advertise themselves as being relatively reliable so I don't know to what extent I can trust them.



This sounds a bit unusual. You are 27 and willing to leave this money invested for 15 years to then use as part of a deposit when you are 42? We have no idea where house prices could be in 15 years time. For example the potential growth in your investment could be wiped out by growth in house prices. Or worse, your investment stagnates or loses money and house prices increase anyway making your lumpsum less valuable to you. And you will have paid 15 years worth of rent in between. Leaving your money to grow while paying lots of rent does not make sense

In your situation, you should focus on:

Career stability & income growth - not always easy depending on the industry as you have said
Building a deposit for a property in cash - the sooner you are not renting the better
Planning for a mortgage - as a freelancer/self employed person, it can be much harder to get a mortgage. You need to be more financially prudent than the average person because you need to supply a lot more documentation to show affordability
Find a spouse/partner if you don't have one already - everything is easier to afford when there is a joint income and the cost of living is split. It opens up more possibilities, for example, a €200k property for a single person may be out of reach but a €300k property might be achievable as a couple.


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## siofrahd93 (2 Feb 2021)

In that case what should I do with 10 thousand? 
You're right we have no idea what house prices will look like, and I'm asking what to do because I *don't* know, although I'm researching as much as possible at the moment. I don't see the point of putting my money into a government bond because the returns are so low, but I don't know what I can do. Would a 5 year investment be better?
I'm looking at some of the MAPS options but I've seen some people say that they're not great.



_OkGo_ said:


> In your situation, you should focus on:
> 
> Career stability & income growth - not always easy depending on the industry as you have said
> Building a deposit for a property in cash - the sooner you are not renting the better
> ...


I am focusing on my career. This is my number one priority, but due to the pandemic and low funding, the pay may not be amazing, as I have said.
I would be happy to earn 25k per year. I'm working in theatre, so not the most stable. As I am still in college I have a very small income because a) we're in a pandemic, and b) my course demands 72 hours per week at least for at least half of the weeks I'm there. This also affects how much time I can give to finding a spouse or partner. Believe me, I know it's easier with two salaries, but I'm not going to settle for someone just for the extra income. 

What do you think of regular investments such as into Irish life or Aviva? 
To be honest, the prospects for my earning potential looks pretty bleak to me, but I need to carve out some plan for future security.


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## _OkGo_ (2 Feb 2021)

siofrahd93 said:


> In that case what should I do with 10 thousand?


Is this all of the cash you have? If it is, I would suggest keeping it readily available to you for at least the next 12-24 months until you are finished in college and normal life has resumed & you are earning consistently. I would not put any of it in a life product as there can be significant setup and early withdrawal fees so if you need it for any reason, you will almost certainly have lost money on it



siofrahd93 said:


> I am focusing on my career. This is my number one priority, but due to the pandemic and low funding, the pay may not be amazing, as I have said.
> I would be happy to earn 25k per year. I'm working in theatre, so not the most stable


It is good that you are focusing on your career but €25k/yr is low. Do you see this growing much into your 30's? Or can you explore ways to increase your earnings, e.g can you further your education in an area that is connected or related to your current industry but is more stable? Using the €10k now to improve you potential income is a far better investment than putting the €10k away for 10-15 years



siofrahd93 said:


> Believe me, I know it's easier with two salaries, but I'm not going to settle for someone just for the extra income.


Never a truer word said and you certainly shouldn't settle for the income  My point is more that at some point in your 30's when you want to buy a property, there is a good chance that you will be doing it as part of a couple and things should be easier.


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## NoRegretsCoyote (2 Feb 2021)

siofrahd93 said:


> I have 10 thousand and I'm looking to invest -



€10k is both tiny and huge.

It's tiny because many investors have a lot more and you won't get a good deal on fees with this amount. It's huge because it's all your wealth.


In your shoes I would keep it in something low risk, low return like state savings.


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## pcrowley (4 Feb 2021)

1. My kids got a inheritance of 10k each, they bought 5 stocks at ~2k each. Most people stick to brands they have a connection with, which is good & bad.  Good: You are able to follow it without getting bored to tears; bad: such shares are inevitably overvalued (which is fine until they cease to be a household brand).
My kids stuck mainly to 'FAANG' stocks and have done quite well so far.

2. Just keep making you monthly deposits into DEGIRO, perhaps use this as a moment to check how your shares are doing. When you make the occasional trade you can add your cash balance to the next purchase.


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## SPC100 (6 Feb 2021)

No doubt they have been doing well on FAANG based on recent history, but You might want to encourage them to diversify beyond FAANG. They (companies not your kids!) may not remain darlings forever.

[broken link removed]

OP what is your total annual/monthly expenditure? I think you should consider keeping 6-12 months of expenses in cash (in cash your income dries up). If lean towards 12 here as it seems your income is not stable and covid likely will continue to affect theater for at least another year imo.


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