About to open Quinn Life Fund

[Carpenter]

The terms and conditions in relation to the Quinn Life Freeway product state that the 23% tax charge "will be made on any growth that you achieve" and that "this tax charge....will be paid over by us to the Revenue Commissioners. You will then have no further tax liability on your investment".

 

[practitioner]

Further to the query above, I incurred a capital loss in the past with a share sale and have paid 23% exit tax on a matured SSIA...am I entitled to claim this tax back by off setting one against the other?

 

[ClubMan]

No - the SSIA maturity/exit tax is not a capital gains tax.

 

[jrewing]

How does one calculate the assessable gain in the case of a unit linked fund? Especially if regular contributions are made over the years? And can one write off expenses, previously incurred losses and annual CGT allowance? And then how do they work out what the 23% exit tax applies to. Sounds like a recipe for a real mess if Revenue actually insist on this. Hopefully somebody will tell us that they do not actually plan to insist on this.

Dos anybody know the answer to this ?

 

[ClubMan]

According to another post relating to this issue the CGT thing is a red herring (on my part) since the tax in question is not CGT at all. Also most or all fund providers will be calculating this tax on behalf of customers as it triggers which is not what I expected. That's my current understanding.

 

[matrix1]

I am considering putting 700 per month into a Quinn policy with:

20% Euro Stoxx (€) [1% yrly mgmt]
20% Celtic (€) [1%]

5% UK FTSE 100 [1.2%]
10% US S&P 500 [1.2%]
5% Tech Nasdaq 100 [1.2%]
5% Biotech (subset Nasdaq Biotech?) [1.2%]

10% Latin America S&P Latin America 40 [1.5%]
10% Emerging Markets NY 50 ADR (looks like a mixture of China, India, Taiwan, Mexico and Brazil - some overlap with Latin AMerica, China funds??) [1.5%]
10% Japan [1.5%]
5% China (maybe this is less risky than Biotech?) [1.5%]

What do you think? I am assuming that Quinn let you split into this many funds! Seems strange that Quinn need to charge as much as 1.2% to track the S&P500...

Thanks!

 

[PMU]

Re allocations: If it costs you money to reblanance, I would try to rebalance by adding new funds.

SPC100 is correct. If you intend to re-allocate you must do it by adding new funds to your policy rather than opening a new policy or re-allocating across policies.

If you re-allocate between policies, you are in effect making an encashment of units in the policy from which you are re-allocating, so you pay tax on the gain in the units encashed. If you re-allocate between funds in the same policy this does not occur.

I was about to re-allocate between policies (i.e. from Celtic in one policy to S&P in another) when the very helpful lady in QL pointed out to me the tax implications of doing this. So instead I re-allocated from the Celtic fund to the S&P fund within the same policy, i.e. I added a new S&P fund to the policy).

 

[hattrick_12a]

Originally Posted by pator
If I decided I'd like to take a risk, does it make sense to open a sperate fund and invest say €4k in Biotech freeway for eg? This then does not effect my main fund

No - this makes no sense. Any gains or losses in the Biotech will have the same overall financial impact on you, regardless of whether it is in a seperate fund or not.

This has raised a Q for me.
What if someone wanted to do a reallocation. For the above, lets say, someone wanted to change the percentage stake they had in the Biotech freeway. Could they just put 4k directly in Biotech freeway, and not have it spread accross the various funds in you overall fund?

Anyone do this?

And, does it make sense if you wanted to rejig your allocations in the various funds? Thereby changing your risk/reward profile...

 

[PMU]

This has raised a Q for me.
What if someone wanted to do a reallocation. For the above, lets say, someone wanted to change the percentage stake they had in the Biotech freeway. Could they just put 4k directly in Biotech freeway, and not have it spread accross the various funds in you overall fund?

Anyone do this?

Yes, and I think I answered this question in my post just above your one.

T And, does it make sense if you wanted to rejig your allocations in the various funds? Thereby changing your risk/reward profile...

You're not changing your risk/reward profile: By re-allocation you are increasing your level of return at the same level of risk. Essentially re-allocation is forcing you to sell high and buy low (or switch units from the fund that has outperformed to one that has underperformed or performed inline). So you are retaining the same level of risk.

 

[messyleo]

This has raised a Q for me.
What if someone wanted to do a reallocation. For the above, lets say, someone wanted to change the percentage stake they had in the Biotech freeway. Could they just put 4k directly in Biotech freeway, and not have it spread accross the various funds in you overall fund?

Anyone do this?

And, does it make sense if you wanted to rejig your allocations in the various funds? Thereby changing your risk/reward profile...

I take it this would count as one of your two free switches a year?

 

[hattrick_12a]

Yes, and I think I answered this question in my post just above your one.



You're not changing your risk/reward profile: By re-allocation you are increasing your level of return at the same level of risk. Essentially re-allocation is forcing you to sell high and buy low (or switch units from the fund that has outperformed to one that has underperformed or performed inline). So you are retaining the same level of risk.

If you had:

50% Celtic (lets say 5k)
50% Euro (lets say 5k)

and you changed it by adding a lump sum in the Biotech to have
33% Celtic (lets say 5k)
33% Euro (lets say 5k)
33% Biotech (lets say 5k)

then you could continue your regular premiums from here

Would your risk/reward profile not be different above?
The 5k going into biotech is not from another fund so you are not "sell high and buy low" or vice versa. It could be savings or whatever...

 

[PMU]

If you had:

50% Celtic (lets say 5k)
50% Euro (lets say 5k)

and you changed it by adding a lump sum in the Biotech to have
33% Celtic (lets say 5k)
33% Euro (lets say 5k)
33% Biotech (lets say 5k)

then you could continue your regular premiums from here

Would your risk/reward profile not be different above?

Hattrick12a: I think there is a terminology problem here. To go back to my original post, I didn’t re-allocate, I re-balanced, i.e. moved units from a higher performing fund to lower performing funds while maintaining the original allocation between funds. (By the way, QL regarded this as one switch.)



You’re correct. If you add another fund you would change the overall asset allocation and thereby change the risk/reward profile.

 

[cork]

How long should you keep such investments?

 

[emsman]

Don't know an awful lot about the stock market but having met with a financial advisor yesterday he convinced me that I should put most of my monthly savings into investments rather than a bank account. So i have chosen Quinn-life. I have been thinkin about this for the past month and here is what i'm goin to do: Gonna put 700pm away into freeway funds:
40% Euro
20% Celtic
20% China
10% Tech
10% Bio

Not sure how i came up with this calculation but there it is!
Any opinions on this?

 

[PMU]

Don't know an awful lot about the stock market but having met with a financial advisor yesterday he convinced me that I should put most of my monthly savings into investments rather than a bank account.
Any opinions on this?

emsman: Did your financial adviser ask you to consider topping up your contributions to your pension plan or taking put a PRSA? There are tax advantages in investing this way. If you have a mortgage did your financial adviser show you the benefits of early repayment of a mortgage, or of increasing your monthly repayments of the capital element? These are issues you should consider before you invest in unit funds.



Unfortunately, nobody can make an assessment of your asset allocation without knowing a variety of factors on your personal situation.
I would suggest that your allocation 40% Euro 20% Celtic (i.e. 60% of your investments in euro denominated funds) is reasonably conservative (or rather it’s more conservative than mine) as it will not expose more than 60% of your portfolio to direct currency fluctuations; but you then allocate the rest to China, Tech and Bio; all of which expose you to currency risk and may well be more volatile. So there would appear to be an inconsistency between your allocations. My initial observation is why would you invest in Tech and Bio (sub-sets of the US market) without considering the US (S&P) fund (i.e. the main market)?
That being said, these are relatively well diversified investments, but you may be in for a bumpy ride.

 

[emsman]

Here's my situation:

He did mention pension contributions to me. At the moment I pay 6.5% and my employer pays 15% pm into a pension scheme which is quite good. I don't have a mortgage yet but would be hoping to get one in the next 3-5 years.
My situation at the moment is:

When I take away my expenses(rent, bills etc...) I am left with about 1200 per month. So by putting 700 into quinn-life that leaves me with about 500 to invest in something else. A saving account maybe??
I don't really understand your question about why I invested in bio and tech and not US. Can you be a bit more clearer on this?

 

[KS1]

The address on my passport and driving licence are different from my current address (on utitlity bill and visa bill). Does anybody know if this is a problem when opening a quinn life freeway fund (due to money laundering regs). rang them but they were a bit sketchy and waiting to hear back. just wondering if anyone had a similar situation.