Orlas Finance
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I plan to leave the funds for a minimum of 7 years before withdrawing to buy a house.
Hi Gordon
She has a longer horizon than 3 years.
Brendan
sorry yes it is unclear i wont be accessing the funds for at least 7 years as I plan to move abroad for a few years first. I wont be investing in the market in the last 3 years approaching the goal to purchase a house for the very reason you mentioned.If the money is required for a house deposit in three years’ time, you shouldn’t invest it at all and you should keep it in cash.
The logic being that you need the cash soon and therefore can’t handle the volatility of investing.
Basically, your €8k could be worth less than €8k in 3 years’ time and you need it for something.
Your post is a little unclear though, perhaps your time horizon is longer?
Calculating the tax on Etfs is hardly so complex if you keep a small spreadsheet of the date you purchased and the shares, just compare the price of purchase with the price in 8 years time and pay the tax on the growth. If you purchase monthly in 1 etf thats only calculations eash month. It cant be that hard if you put in a handful of hours work. Why pay a Zurich or Irish life to look after the taxes for you and miss out on thousands of potential profit?IMO seven years is on the lower limit of what constitutes long-term investing - others might say five, ten or longer.
If you’re reasonably sure you won’t require the funds for that long, consider studying up on Investment Trusts (IT’s). At time of writing they are classed for tax purposes as shares, so Capital Gains Tax is paid on profits over the annual allowance.
Personally, if investing outside of a pension, I would stay away from mutual funds/ETF’s - calculating the tax owed in Ireland is a complicated process. The Zurich fund will handle the tax owed for you, however IMO Life Company’s fee structures are not transparent and should therefore be avoided.
IT’s are a way to make a single investment that gives you a share in a much larger portfolio. A type of collective investment, they let you spread your risk and access investment opportunities you may not find on your own. You’ll find an excellent beginners guide to IT’s at ’The AIC’ website.
You can obtain information on individual IT’s there also in the ‘Find and Compare’ section.
A good starting point to research would be an IT investing in global shares across a wide range of sectors such as ‘Bankers’ or ‘F&C Investment Trust’ (these are not recommendations).
DeGiro is likely to be the lowest (or one of the lowest) cost platforms to buy individual shares or IT’s.
Good luck with your savings!
Calculating the tax on Etfs is hardly so complex if you keep Why pay a Zurich or Irish life to look after the taxes for you and miss out on thousands of potential profit?
Calculating the tax on Etfs is hardly so complex if you keep a small spreadsheet of the date you purchased and the shares, just compare the price of purchase with the price in 8 years time and pay the tax on the growth.
I am seeing more and more of "you can't lose on equities" sentiment on AAM.
If the money is needed in 7 years still throw it in Degiro. You will make a small profit by having fees of 0.2 or lower vs taking a life company with high fees. 8k is not much, where it will make a massive difference but a better deal is a better deal.Without getting into specifics, which ETF will pay thousands in profit over a life company offering on an €8,000 investment over seven years?
It's just a casual impression. I've increasingly seen people recommend equities on the basis that deposit interest is zero.I have not noticed that.
Hello! first thanks anyone for reading and helping I really appreciate it.
I am 19 yrs old and have 8K saved and want to invest the majority as I have a part-time job and live at home (college is online) so not worried about having an emergency fund and I have a car with no debt. I would also want to add about 6-9k to my portfolio for the next 3 years so I would be investing monthly also. Currently, I have zero investments.
My question is where should I put the money?
- Initially, I was thinking of using trading 212 and buying vanguard mutual funds and s&p 500 but there's a new 0.7% fee on credit/debit card deposits so it's no longer 'free'. Also, it is UK based so I'm confused about the tax on gains, etc. I plan to leave the funds for a minimum of 7 years before withdrawing to buy a house.
- I also liked the Zurich Prisma 4 fund but it has a high fee (1.5%ish) but if the tax makes more sense maybe its better?
So basically from my research, I thought vanguard was the way to go, any suggestions on where to buy this, and what taxes I would have to pay?
Also, my reason against setting up a pension is I obviously need the funds in the next decade but Id be open to opening a pension and maybe putting in 50 euro a month if it made sense tax-wise.
Thanks guys!
If the money is needed in 7 years still throw it in Degiro. You will make a small profit by having fees of 0.2 or lower vs taking a life company with high fees. 8k is not much, where it will make a massive difference but a better deal is a better deal.
Then if later on she ever sets up a long term portfolio, you wont go with the comfortable life company. DIY it on Degiro, build up your pot and hold it it for 30 years. When you have 50/100k invested you will be making big savings vs a life company.
Find me a period over 15 years where by investing in a broadly diversified ETF with low costs does not make you significant profits? Hint: You won't be able to!“Throw it in DeGiro”?
“You will make a small profit”?
“Hold it for 30 years”?
“You will be making big savings”?
Sounds like you have it all sussed.
Find me a period over 15 years where by investing in a broadly diversified ETF with low costs does not make you significant profits? Hint: You won't be able to!
This reminds me a lot of the sales pitch used to flog Bulgarian apartments circa 2005, i.e.‘You can’t lose’. I recall on one occasion a taxi driver telling me he bought two!
I might take a leaf out of Joe Kennedy’s book and take some profits off the table.
They’re simply not comparable.
One of the many downsides of Ireland’s economic crash is that it taught some people misleading lessons.
They acquired an “investing is bad” mentality.
Having all of one’s money in a single bank stock or buying four Bulgarian apartments off the plans are examples of buffoonery. And comparing them to holding a cheap global equity tracker held for 15 years is equally nonsensical.
I felt like a complete mug... my savings pot paying for all those fund managers' hefty salaries. I also realised that while I was grafting all day, my money matters were neglected.
HOWEVER, that has all changed now with online investment tools. Buying & selling shares is so much cheaper and easier to do online and at short notice. The company information & analysis is all online. Competition is fierce.
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