# 75k to invest



## doctordog (2 Apr 2010)

I have about 75k to invest. what are the best (general) approaches now?

Should I use it to clear down mortgage ?
Should I invest it in some saving account and take some income from it each year ?
Buy 75k worth of lotto tickets ?

My requirements are:
- must be 100% safe and secure.
- Not interested in shares for this.
- I have a pension which is well funded (by myself) 
- I have a number of properties already so dont want to buy any more.


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## Anfear (2 Apr 2010)

Nice financial situation!
What timescale are you looking at?
Realistically the only thing that would be "100% safe & secure" would be actual individual Government Bonds & I'm not sure what the minumum denomination is.
You would get the "coupon" every year & a refund of the face value when the bond matures. Don't sell it before it matures because the market value at a point in time (up to maturity) fluctuates with long-term interest rates. Hold it til maturity & the full initial face value is returned. Of course it is only as "safe" as the sovereign state issuing the bond! The risk is that of default, either not paying the coupon every year, or not being able to repay the capital at maturity. Very few sovereign states default!

Just be aware, if you invest in a "bond fund", ie an investment fund that consists of a large number of individual bond issues of varying maturity and quality, as opposed to an individual bond, the unit price of the bond fund can vary so you could not regard your capital in a **bond fund** as 100% safe. There are various reasons for this, but be aware there is a clear distinction between individual bonds and bond funds as investment vehicles.

The only thing is, as I said, I am not sure what the minimum investment level is in a government bond here. Perhaps someone else can enlighten.

There is a nice little book called "Understanding Bonds & Gilts in a Day" by Ian Bruce, gives a good explanation without getting too technical. It's probably available on Amazon. Regards


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## Bob_tg (3 Apr 2010)

doctordog said:


> Should I use it to clear down mortgage ?
> .



If you don't need the cashflow in the medium term, and if you have the facility within your mortgage for paying early (e.g. some fixed products don't allow for early payments) this option could be well worth considering, as paying down loans is a certain return.


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## PeterBrennan (3 Apr 2010)

-must be 100% safe & secure. 

There is no such investment. Even govt's can collapse and the currency become worth less in relative terms  eg Iceland recently. Safest thing is the Post office bonds.


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## Lightning (3 Apr 2010)

It seem like a savings account would suit your needs. 

Have you checked out the savings best buys threads?


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## ringledman (3 Apr 2010)

Anfear said:


> Nice financial situation!
> What timescale are you looking at?
> Realistically the only thing that would be "100% safe & secure" would be actual individual Government Bonds & I'm not sure what the minumum denomination is.
> 
> You would get the "coupon" every year & a refund of the face value when the bond matures. Don't sell it before it matures because the market value at a point in time (up to maturity) fluctuates with long-term interest rates. Hold it til maturity & the full initial face value is returned. Of course it is only as "safe" as the sovereign state issuing the bond! The risk is that of default, either not paying the coupon every year, or not being able to repay the capital at maturity. Very few sovereign states default!


 
This is a fallacy of investing - That government bonds are safe.

Government can devalue the currency until it becomes worthless. Yes you will get back your face value, unfortunately the currency that supports the face value could be worthless and your 75k would only buy a tin of beans.

On the second point - Very few states default - 

Have a read of 'This Time its different' by Rogoff & Reinhart.
http://www.amazon.co.uk/This-Time-Different-Centuries-Financial/dp/0691142165

It charts 800 years of governments defaulting, debasing and inflating their way out of their obligations.

There is not an investment in this world that is 100% safe and secure.

Western Government bonds are the next 'bubble' to explode if you listen to Marc Faber, Jim Rogers and Peter Schiff. 

I think they will be proven right...


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## plendoza (9 Apr 2010)

Pay €60,000 off the mortgage - at least that's banked then and nothing to worry about.

Fool around with the other 15k (or even less if you are not comfortable) and buy some shares of one company - dont spread it around too much between different investments - you only live once. If you are taking on Ringledman's advice into account I would convert to Norwegian krone and buy a stock of Norwegian shares. Norwegians don't know what national debt means, they have a big soverign wealth fund instead.

Whatever investment you make, you need to get down and dirty and do the research. The fool and his money are soon parted


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## Cynic (15 Apr 2010)

Disagree on the mortgage front- rates are low at the moment and you can make your cash work for you in a far more productive way.  My advice is diversify as much as possible, nothing is 100% safe and eggs in one basket is always a bad idea.  Make sure you get your IFA (or even your lawyer) to do good due dilligence on anything which is "alternative" or go for a Swiss savings account.  You may not want any more property, but there are some amazing bargains out there at the moment.


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## Daddy (15 Apr 2010)

Peter Brennan

states post office bonds are the safest thing.

not if a country defaults surely ?


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## EMG (15 Apr 2010)

Dont invest it all in the one pot... think wisely... consider your stage in life.. will you need it or not in 2-3 years... the older you are the less risk you should involve yourself in... Speak to someone with a good track record in investments, speak to someone like a broker who has access to more than one product, if you go directly to one investment company you are limited to what they have to offer. Hope this Helps Emma Gollogly


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## PeterBrennan (26 Apr 2010)

Daddy, if the country defaults, the best things to invest in are gold (offshore) and tinned food.


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## Markjbloggs (26 Apr 2010)

PeterBrennan said:


> Daddy, if the country defaults, the best things to invest in are gold (offshore) and tinned food.



Shotguns - don't forget the shotguns....


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## doctordog (27 Apr 2010)

thanks for all the help.

I didn't think the "100% secure" requirement would be taken so literally....

Following some "external" advice, I think the best option for me is some form of deposit or saving accounts that pays a reasonable amount of interest.

The An post scheme over 3 and 5 years seems reasonable to me.






SPC100 said:


> The only thing that I can think of that meets 100% these requirements is to pay down the mortgage. But the current return on that is the same as your mortgage interest rate, which is likely close to a historic low.
> 
> Other strategies result in you depending on governments, currencies, banks, 3rd parties to some degree or another e.g.
> 
> ...


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