# €200k to invest



## ingalway (19 Mar 2007)

I have around €200k to invest - don't really want a monthly investment plan as I already have a small one with New Ireland and have doubts about the charges etc - have been too lazy to go into it in greater depth to get the finer detail but feel I am not getting great value for money.  I also have a fairly healthy stock portfolio that I manage myself.  I am looking for something fairly risk free that will give me a lump sum after a given period.  I am thinking of myself and partner each investing €80k in post office savings certs and another €40k in something like Rabo.  I estimate that would give us approx €70k return in 5 years - are my sums correct on this?  Any other options that might be better?
Thanks


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## CCOVICH (19 Mar 2007)

I calculate an after tax return of less than €10k on the Rabo deposit (subject to certain assumptions).  I have no idea what An Post Savings Certs offer-the website says 16%, but no further info other than to contact them.  But I assume they mean 16% after 5 years, which would suggest a return of €25,600 on €160,000.

Between An Post and Rabo, this suggests a total return of around €35k, which doesn't look great in % terms on €200k.

So I think one of us is way off in our calculations/assumptions.

For €200k, it may be worth paying someone (and Authorised Advisor) to take you through other investment options.

Do you have a mortgage?
What about pensions?
What do you want to do with the money in 5 years?


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## oldtimer (20 Mar 2007)

Saving certs are a poor investment at the moment. They are offering 16% over 5.5 years and to get that you must leave them for the full term. It works out at 2.74% per annum which, although tax free, is still poor. Likewise An Post saving bonds are no better, offering 8% over 3 years and again you must leave for 3 years to get that amount. It works out at 2.6% tax free, again poor return in to-days terms.


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## ingalway (20 Mar 2007)

Thanks very much for your responses.  I, very stupidly, assumed that the interest rates were yearly and not accumulated over the 5.5 or 3 years - should have known it was too good to be true!
I don't have a mortage, have very little outgoings.  Do have a pension which I have not kept up with properly for the last few years - again I am very sceptical of pensions now as there seems to more and more stories about what you will actually get back on them - I have another 25 years before I will be 65.  Maybe I am being very shortsighted but I just feel that things will be so different by then that I am more inclined to take my future into my own hands more and try and make good investments myself up until then and maybe invest a smaller amount in a managed pension fund.  Goes against all current wisedom I know....


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## CCOVICH (20 Mar 2007)

I would seriously look at the pension situation-the tax relief alone could make it very worthwhile.  Going with an index tracker with low charges (e.g. Quinn Life) may be a good idea over a 15/20 year term, switching to cash thereafter, but that's just my own (amateur) opinion.


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## Happy Girl (20 Mar 2007)

ingalway said:


> Do have a pension which I have not kept up with properly for the last few years - again I am very sceptical of pensions now as there seems to more and more stories about what you will actually get back on them - I have another 25 years before I will be 65. Maybe I am being very shortsighted but I just feel that things will be so different by then that I am more inclined to take my future into my own hands more and try and make good investments myself up until then and maybe invest a smaller amount in a managed pension fund. Goes against all current wisedom I know....


 
I am in completely the same situation as you. Have investigated pensions until my eyes and brains are sore and eventually decided to go with a PRSA - only because I was going with the herd not because I felt it was a huge plus. However I have spoken to Eagle Star today re PRSA and they are now pushing me towards a Personal Pension Plan rather than PRSA. So I have decided just as you said above. Will shove 20k into Quinnlife for the next 25yrs and forget about it until I retire and take my chances.


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## KalEl (20 Mar 2007)

Golidilocks said:


> I am in completely the same situation as you. Have investigated pensions until my eyes and brains are sore and eventually decided to go with a PRSA - only because I was going with the herd not because I felt it was a huge plus. However I have spoken to Eagle Star today re PRSA and they are now pushing me towards a Personal Pension Plan rather than PRSA. So I have decided just as you said above. Will shove 20k into Quinnlife for the next 25yrs and forget about it until I retire and take my chances.


 
I'm no expert either...trying to set one up myself at the moment without being raped on commissions and charges.
But aren't you forsaking the massive advantages of tax-relief?
I've done a fair bit of research and am just going to run with an Eagle Star PRSA through a flat fee broker run on the default investment strategy to be invested in an ARF when I retire.
I agree that pensions are a mess but the advantages are too good to overlook...in my opinion


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## Happy Girl (20 Mar 2007)

I hear what you are saying but we have to remember that it is not a tax saving but a tax dererral. You save one end to pay at the other or is this too simplistic a view?


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## KalEl (20 Mar 2007)

Golidilocks said:


> I hear what you are saying but we have to remember that it is not a tax saving but a tax dererral. You save one end to pay at the other or is this too simplistic a view?


 
Well, as I said I'm no expert but there are tax advantages which hold true initially and at retirement. For example, you can take a nice big dropsy (technical term is tax-free lump sum!) at retirement.
And the savings and growth from lashing money in and getting full relief far outweigh the tax you will pay on income derived from the pension in the future. Plus there are benefits for your family after you die.
As I said I'm no expert and sceptical as hell about these matters but pensions are a good idea.


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## z106 (26 Mar 2007)

Property !!!


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## ClubMan (26 Mar 2007)

qwertyuiop said:


> Property !!!


Why???


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## KalEl (26 Mar 2007)

qwertyuiop said:


> Property !!!


 
Probably what investors will scream as they throw themselves off this new docklands skyscraper!
With a relatively substantial sum like this, as CCOVICH said, you should seek professional advice from an independent authorised advisor. Avoid banks and tied agents who'll just try and sell you their own (sometimes dare I say it unsuitable) products.


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