EBS is not mentioned at all in that article as far as I can see.
The link above doesn't work properly for me (keeps refreshing the page) so this one might be more reliable.
I read this article and thought it made a lot of sense. I'm not sure where you got the EBS angle?
You can then either leave the SSIA on deposit with Rabo/NR and drip feed it in to a regular saver product maximising your return. Yes you will be losing out technically but not by much. And having cash on hand is worth something.
If you can find an investment that pays more than 6.9% after tax then it might make sense but why not spend the money and put money directly into the same regular saver account?
Sure, you won't have a lump sum for a period but you'll end up with more money in the end and even after 1 year if you get an interest rate of 4.75% you'll have over 6,000 in the bank.
So for the 'peace of mind' of having the money in the bank, you'll lose 3000 euros and have less left over after 3 years
Why did you do this? In pure monetary terms it doesn't seem to make sense.
I suppose it might make sense if one didn't have a rainy day fund already. SSIA money is in bank for emergencies etc. However I think it's foolish to borrow and pay interest while keeping a large sum in the bank.
I agree with liteweight above - if you SSIA money is your emergency fund and you don't have one otherwise then it may make some sense. Otherwise I don't think that it does make sense to borrow while maintaining savings in this context (unless you are lucky enough to have something that guarantees returns in excess of the loan rate).A combination of liking to have an emergency slush fund and knowing I'll need the money for an investment shortly.
I would of thought it was similar to not using lump sums to pay off your mortgage? I know the rates are obviously lower and DIRT is an issue but do you think I'm mad to do this?
I agree with liteweight above - if you SSIA money is your emergency fund and you don't have one otherwise then it may make some sense. Otherwise I don't think that it does make sense to borrow while maintaining savings in this context (unless you are lucky enough to have something that guarantees returns in excess of the loan rate).
It was the Tesco rate that clinched the deal for me. 6.9% over 2 years seemed very good to me. Was just going to use cash but figured I'd prefer to have a sizeable enough emergency fund...plus thinking of getting married plus will need cash for an investment shortly.
So would you agree that this approach may make sense for you but that in general it is probably a bad idea to borrow to fund the purchase of car while leaving the same sum of money on deposit?
Since you are eligible for the loan, then why not just apply for it if/when the emergency arises?
As you say, seems silly to pay interest on borrowed money when you have the same amount sitting on deposit earning far less interest.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?