My deposits: What would you do next?

Y

Yogi

Guest
Folks,
Apologies if this is posted in the wrong section but I am in search of your opinions and would be grateful to recieve all views in the context of the current economic situation in Ireland (I have read the Key Posts and done many searches on the site but need to clarify my thinking further):
My general financial position is that that I have an interest only .95% tracker mortgage on an investment property. The mortgage amounts to approx. half of my deposits which I have recently moved to 3 banks in Ireland who operate outside the Irish guarantee. The house is rented at the moment, I own my own house, I am working in a relatively secure and relatively well paid job and I have no other loans (I do realise how lucky I am!).
Up to this I was happy to leave the mortgage as interest only because I am making more money on deposit and had the money in demand accounts so it could be easily moved if that was needed but I am now torn as to what to do now beacuse of what I percieve to be the worsening Irish financial context e.g. should I:
*move the deposits into euro or other currency accounts outside of Ireland.
*Pay off the mortgage and be debt free and hope for the best
*Pay off the mortgage and put the deposits outside the country
*Leave the money and mortgage where it is and hope for the best

What would you do in my situation? All thoughts / advice appreciated. Thanks in advance.

Yogi (probably not smarter than the average bear!)
 
I would pay off the mortgage. I know that is not the best thing to do from a financial perspective, but I would feel better having no debt.

I have moved all my savings offshore. (Currently in Keytrade Belgium; trying to get them in a DB account I set up two months ago).
 
Your investment mortgage is keenly priced, ultimately you will have to address the capital repayments, will the tenant pay most of the mortgage on a capital and interest based mortgage over say 15 to 20 years..., what effect does paying off the mortgage have as it would relate to taxation...as against now..

I would not pay down this mortgage, you are under no pressure, you have funds spread across other State guarantees rather than any reliance on our Irish state guarantee, personally I considered a transfer of funds out of Ireland but I didn't follow through, I have diversified the deposits very similarily to yourself, I don't really see that as hoping for the best but who knows...,

It is comforting to have that cash, hold onto it.
 
Can anyone put an approximate average % cost on transferring money into other currencies? Thanks

DocOc
 
The 0.95% tracker mortgage( plus 1% ECB I presume) is an excellent thing to own. At present you are earning a higher rate of interest on your money in deposit accounts. You can also deduct 75% of the interest against tax on the rental income.

If you are a higher rate tax payer that is a tax saving of 1.95 x 0.75 x .4 = 0.585% on your mortgage amount. I can see no reason to pay off the mortgage.

Moving your savings out of the country is a different issue, and depends on your opinions, if you trust the Irish banks and govt.
 
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