More equities?

B

Bearsandbulls

Registered User
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28
Age: 33
Spouse’s/Partner's age: 34

Annual gross income from employment or profession:81k (71k salary,5k overtime, 5k additional income)
Annual gross income of spouse:50k

Monthly take-home pay 5.5k , was lower than this over last year for extended maternity leave and will be reduced again in 4 months for a year

Type of employment: e.g. Civil Servant, self-employed me private, spouse public

In general are you:
(a) spending more than you earn, or
(b) saving? Saving 2k per month

Rough estimate of value of home €280k
Amount outstanding on your mortgage: 0
What interest rate are you paying? N/a

Other borrowings – car loans/personal loans etc none

Do you pay off your full credit card balance each month? Yes
If not, what is the balance on your credit card?

Savings and investments: 30k cash
30k equities

Do you have a pension scheme? me DC scheme 100k (maxing out AVC)
Partner post 2013 public scheme

Do you own any investment or other property? No

Ages of children: 2,0

Life insurance: me death in service 284k
Partner none

We have saved our rainy day fund and I would like to know your suggestions of what to do with future savings?

I currently max out my AVCs in the company scheme but I am considering setting up a PRSA AVC instead as I want to make my own investment choices.
Partner (soon to be wife) currently has no AVCs but is considering going to reduced hours with the small kids. If she stays on full hours, I will prioritise AVCs for her.

Would you recommend continuing to put all futures savings into equities?
 
Bearsandbulls said:
Thanks Coyote, just wondering if there was alternatives to equities that people are considering.
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There are bonds of course. They've taken a dip recently, but prices are at all time highs and there is a natural ceiling to prices as interest rates cannot go much lower. Equities have huge upside potential over 40 or 50 years. Bonds just don't.

You can also invest in property directly but for pensions this makes little sense as you get no tax relief like with a pension fund, you are taxed on the rental profits, and taxed on any capital gains.
 
NoRegretsCoyote said:
There are bonds of course. They've taken a dip recently, but prices are at all time highs and there is a natural ceiling to prices as interest rates cannot go much lower. Equities have huge upside potential over 40 or 50 years. Bonds just don't.

You can also invest in property directly but for pensions this makes little sense as you get no tax relief like with a pension fund, you are taxed on the rental profits, and taxed on any capital gains.
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I'll consider bonds later in my life when the time comes but agree with you that there is no appeal in them now.

Regarding pension tax relief, I'm currently getting the maximum available to me here through my AVCs. Will do the same for partner once she decides what shes doing regarding reduced hours.

I've considered property and its something I'm unsure of. I live in the countryside and am about 1 hours drive to nearest city. Rental returns around here are modest, approx €700pm for a 3 bed house. Looking for even a 7% yield would require a livable standard house for €120k. The only people here that can get rental property for that kind of outlay are tradesmen who have the skill and knowledge to be able to renovate a fixer upper themselves. Simply knowledge I dont have, and it would cost me in excess of this to pay for a builder to complete renovation. I would have no interest in purchasing property in the city to rent
 
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