She has enough money that she can buy shares directly for a once-off fee and hold them - she doesn't necessarily have to buy into a fund with management charges (and for the same reasons as you, I would be wary of signing up to anything with substantial charges as it will really eat away at the returns). I think that's what I would do - a well diversified portfolio of shares with the intention of holding long-term, not trading regularly - and preferably shares with no/low dividends and high capital growth.I think that anyone 'investing' there is fair game to the vultures that reduce your capital with hidden management charges etc.
Bronte
Whatever your views on property vs. shares, it makes no sense to borrow to invest, when you have the cash.
She will not be able to get a "high and safe deposit" rate in excess of the cost of borrowing.
If her financial future is secure, she should not borrow as it just increases risk.
If her financial future is secure, she should not borrow as it just increases risk.
Well is there a risk if she already has the 'borrowed' money in a savings account I wonder?
If the yield on a purchased propery to rent is high it might be a good investment. Plus if property prices rise she may gain from capital appreciation, (hope that one is ok as sorry I overstepped the mark yesterday). And should property prices rise she has the added bonus of already having a Dublin property availabe to her kids when they go to college and thereby her outgoings will be less.
No need to do any further figures on this one. If Bank of Ireland lent you €100,000 at 5.5% to put on deposit at 3%, what would you say to them?
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Recently banks are not inclined to lend to someone who has cash they could use instead. They want the customer to be as committed as possible to the property purchase. The banks now look for details of all savings – not just to check if there’s something like a CU loan involved but to also to see if the bank is more exposed than they need to be on a loan.Bronte said:And it's easier to borrow if you have money
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