Best way to save for students

G

globy

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Im a PhD student earning a wage of €1000 a month with no savings other than my SSIA (~7,000) which is due to mature next month. I am paying rent at 450 a month and have the usual domestic bills. I have no car and am very good at saving. However, I am a complete virgin when it comes to savings and interest accounts etc and now that I have this lump sum of money I want to know how best to invest it while I am in college for another four years. I aim to fully invest €5,000 of my SSIA without touching it over the next say 5 years.

I see A.I.B has a regular saver account with interest of 6%. Having talked to a customer service agent of AIB, they informed me that should I lodge €300 a month into this account, I will get my 6% interest rate. Is this true???

Also would it be wise to save with AIB and BOI or open a rabodirect account or another online account and save with them too i.e have your AIB account and/or an BOI or online account. A close friend advised me to invest ~3000 into prize bonds. Has anyone any opinion on this.

Really I would just like to know what would be the best way to invest with this money. People are telling me to do different things and some are skeptical about the AIB reg saver account, claiming that there is no way a bank would give you 6% interest-is this true!!!

Thank you in advance
 
Have you checked the for details of the best lump sum and regular savings deposit rates on offer? Longer term investments with higher returns will generally involve taking more risk and will probably mean some form of direct or indirect (e.g. low charges unit linked or index tracking funds) equity investment. Have a read of the key topics and the many threads on this sort of issue.
 
i have those prize bonds for years and never got a win from them forget about them, unless its for a small sum say 100 euro
 
Prize Bonds are not really an savings/investment instrument in my opnion. They are tickets to a lottery that are redeemable at their face (nominal!) value (which will be eroded over time by inflation). No harm in having a few for the sake of being in the game but not something to put most or all of your savings into.
 
ClubMan said:
Have you checked the for details of the best lump sum and regular savings deposit rates on offer?
Click to expand...
Thanks to all who posted me. In regards to the above quote by ClubMan, I saw during the weekend that Bank of Ireland has a savings scheme that is quite like the orignal SSIA i.e.
Want to keep earning a 25% bonus based on new savings?*

You can with the Special Bonus Investment Plan* - a life assurance equity-based investment policy.
Bank of Ireland Life is offering you the chance to get a 25% bonus based on new regular savings for the first 6 months of the policy term.* All you need to do to get started is invest an initial lump sum plus set up and maintain a monthly regular payment for at least 3 years.
If you already have an SSIA, once it matures, you too can avail of a 25% bonus. To qualify for this, simply invest an initial lump sum equal to 3 times your regular annual savings and continue to save for at least a further 3 years. You will then receive the bonus based on your new direct debit amount.
The chart below illustrates how your regular savings amount determines the lump sum needed to get started. It also shows how quickly another lump sum can be built up.
Projected Returns

Monthly Contribution
Initial Lump Sum
Projected Value after 5 years​

€100
€3,600
€10,825
€254
€9,144
€27,495
€500
€18,000
€54,122

Figures include 25% Contribution Loyalty Bonus for the first six months, assume growth of 6% p.a., and are net of tax and charges. These figures are estimates only, and are not a reliable guide to the future performance of this investment. Terms and conditions apply.*
The Special Bonus Investment Plan is an equitybased life assurance policy and has the potential to outperform deposit savings accounts*. Ask for a more detailed brochure which is available at your branch.

Would it be wise to choose this option? I have enough funds in my SSIA account to lodge the lump sum of €3,600 and €100 monthly for three years. My fear is that I am putting all my savings into one savings account. Also am I correct in saying that if that the above scheme operates by an initial lodgement of e.g. 3,600 and 100 monthly instalments for three years. Afterwards I can withdraw my money or do I have to wait two years. Would anyone suggest that the AIB regular saver account is actually a better option that BOI? Or maybe do both???

Many thanks
 
A chance to earn a 25% bonus sounds a bit iffy to me. Looks like this product may be a tracker bond. You should read up on some of the comments on such products before deciding that it's for you. Before picking on individual products you really need to review/understand your short, medium and long term savings/investments goals and only then look for products that match those requirements. Not the other way around. Have you read the key topics that I linked to earlier in particular the AAM and IFSRA guides to savings & investments?
 
Thanks Clubman,

I have read up on your earlier posts and advice too. I have recently spoke to an AIB customer service rep and as stupid as this question is-if I open the regular saver account and save the max of €300 a month for at least three years-how much interest will I have gained?

I am very confused on this ECB+2.5%. Am I correct in saying that for the first 18 months, I am guaranteed ~ 6% interest in my €300 monthly lodgements and after the 18 months, I will only get ECB interest.

Thanking you in advance.
 
I was reading about Rado Direct new interest offer. When does one need to open an account with them in order to qualify for the 4.75% interest
 
Quote from www.rabodirect.ie:

However, from the 1st of January 2007 to the 31st of December 2007 we will be offering our customers a variable rate of 4.75%* on savings from €1 up to €10,000. Balances from €10,000 up to €1 million will get a variable rate of 3.70%** on their savings. Standard variable rates will apply thereafter.
 
Hi Globy, I'm a student as well. I don't think you should 'invest' in a savings account. At your age you should have a very high risk tolerance, putting money in savings accounts or bonds is more suitable for people approaching retirement. Also note that these methods rarely beat inflation, especially after taxes.

IMHO you should put the money into index funds, maybe with a small percentage in bond funds. Try to diversify these positions as well, maybe over different markets, currencies and capitalisations.
 
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