redundancy cash advice

[waxwork]

I just received a redundancy pay out and have 25,000 euro 'spare' so was wondering what would be my best options to do with it. Haven't really a clue as have never really had a big lump of money.
I used some of the package already to pay off the deposit on apt I have bought jointly with my girlfriend. (We had previously taken out a credit union loan to pay this deposit)
I got a phone call from my bank BOI asking me to come in and talk to them about some investments schemes.
Would really appreciate some advice on the pros and cons of these type of schemes, as well as any other options I might have like lumping it into my mortgage etc.
Yours in hole burning in my pocket, Waxwork.

 

[ClubMan]

I got a phone call from my bank BOI asking me to come in and talk to them about some investments schemes.

Don't expect independent, professional advice from tied agents. Better to go to a good multi-agency intermediary or authorised advisor who deals with more than one product provider. If you are buying a house then why not save money by reducing your borrowing requirements (e.g. borrow up to €25K less than you would otherwise and thus save a significant amount on long term interest costs)? Or if you have other even higher cost debts then consider clearing/reducing these first.

 

[LDFerguson]

Hi Waxwork,

The Key Posts are a good place to start.

 

[waxwork]

Don't expect independent, professional advice from tied agents. Better to go to a good multi-agency intermediary or authorised advisor who deals with more than one product provider. If you are buying a house then why not save money by reducing your borrowing requirements (e.g. borrow up to €25K less than you would otherwise and thus save a significant amount on long term interest costs)? Or if you have other even higher cost debts then consider clearing/reducing these first.

I bought an apartment earlier in the year (before I got the redundancy) with my girlfriend and have used some of my redundancy already to pay off the loan we got out to pay the deposit on that.
I now have 25,000 left and it's just sitting in my bank. I have no other debts really apart from my jointly held mortgage of around 280,000.
Just wondering what my options are with this 25,000 and how much I would be likely to make over the course of a year or two if I were to invest it or put it in one of the savings accounts contained in the other link (thanks, Ferguson).
Mainly I suppose I'm asking what would people do if they were in my position??

 

[South]

Two choices:

1. Use it to pay off some of the mortgage of 280k
2. Invest it

What is the interest rate on your loan?

If you expect the return on investment to be in excess of the interest rate, it would probably make sense to invest it...but that is a big IF!

 

[ClubMan]

I have no other debts really apart from my jointly held mortgage of around 280,000.

So why not reduce this? Use Karl Jeacle's mortgage calculator to estimate how much you might save by reducing the capital outstanding on your mortgage. I estimate that by paying off €25K of a €280K mortgage (assuming 5% over 30 years) you could save c. €23K in interest payments.

Just wondering what my options are with this 25,000 and how much I would be likely to make over the course of a year or two if I were to invest it or put it in one of the savings accounts contained in the other link (thanks, Ferguson).

There are lots of options but you would need to post much more detailed info about your overall situation, plans, investment timeframe, attitude to risk/volatility etc. etc. for people to comment. You probably need to get professional advice.

Mainly I suppose I'm asking what would people do if they were in my position??

What other people might do and what might be appropriate for your specific needs may not be the same thing. Have you checked the keys posts as suggested and, in particular, the AAM and IFSRA guides to savings & investments?

Once again I would urge you not to go to BOI expecting them to give you independent, professional advice since they will just try to sell you their own products no matter how suitable or otherwise these may be for your specific circumstances.