Seeking Suggestions: Managing Cash in Investment Strategy for Potential Move

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noonamer

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Hey everyone,

I'm seeking some perspective on my investment and savings strategy. I'm a 31-year-old married individual eagerly anticipating the arrival of our first child. We're considering a potential move from Ireland to a more affordable country like Poland, Lithuania, or Estonia, likely within the next 1-2 years. Here's a breakdown of our current situation:

Income and expenditure​

  • PAYE Salary: €6,500 per month after taxes
  • Rent: €2,500 per month (Dublin, as have to go to office)
  • Monthly Expenses: Average of €1,500
  • Spouse's Income: None
  • Loans: None

Summary of Assets and Liabilities​

  • Cash: €40,000 Irish Bank + €12,000 in Trade Republic (earning 2% per annum)
  • Crypto: €20,000 (which is down €8,000)
  • ETF: €15,000 in VWCE
  • Stocks: €8,000 from previous employer
  • Monthly Investment: Adding €1,200 to VWCE
  • Pension: Contributing 5% (with a 5% employer match)
My rationale for holding onto cash is our potential move abroad, which is likely to happen in the next year or so. Even after we relocate, we won't be rushing into purchasing property immediately, as we've decided to live there for a bit before making such a commitment. This means we'll probably need more cash around 2-3 years down the line. However, I'm concerned about inflation eroding the value of our cash. I'm looking for suggestions (though not official financial advice) on how to manage this situation effectively.

On that note, I'm contemplating stopping cash accumulation and instead increasing my contribution to VWCE. Your thoughts?

Thanks in advance for your insights!
 
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If you're likely to be using the money in savings/investments in the next year or so then there's probably not much that you can do other than put cash savings on deposit at the best rates on offer:

Best Buy - Savings Best Buys

Savings Best Buys: There are 3 savings best buy threads on AskAboutMoney that are updated frequently. Instant Access and Notice Accounts - Lump sum variable rate savings. Fixed Term Deposits - Fixed Lump Sum Term Deposits from a few months to a few years. Regular Savings - Smaller sum...
www.askaboutmoney.com
I would question the appropriateness of having such a large amount of your overall savings in crypto and maybe even in shares in your former employer instead of spreading the risk with a more stable and diversified portfolio - especially if your short term priority is to buy a home.

That being the case you should probably prioritise accumulating cash and maximising deposit returns - I'm not sure that investing further in the ETF is a good idea if the plan is to use much of your accumulated assets for a property purchase in 12-24 months.
 
Thanks for the reply!
I would question the appropriateness of having such a large amount of your overall savings in crypto and maybe even in shares in your former employer instead of spreading the risk with a more stable and diversified portfolio - especially if your short term priority is to buy a home.
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That being the case you should probably prioritise accumulating cash and maximising deposit returns - I'm not sure that investing further in the ETF is a good idea if the plan is to use much of your accumulated assets for a property purchase in 12-24 months.
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More likely it is going to be in 24-36 months. I'm really sad seeing cash being deflated so much these days, and with the uncertainty when to buy, it might be even more painful. But on the other hand, as far as I understand ETF worth doing with at least 5y horizon in mind
I would question the appropriateness of having such a large amount of your overall savings in crypto and maybe even in shares in your former employer instead of spreading the risk with a more stable and diversified portfolio - especially if your short term priority is to buy a home.
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I agree on crypto, but not sure about stocks, you mean selling them and put into ETF?

Stocks, ETF, Crypto is more like an investment with no intention to sell at near future (I hope). With the uncertainty in mind I'm strongly considering maximizing ETF investment for next 6-12 months and reviewing it on regular bases, this probably might help building bigger pie for long-term while things are still under current circumstances.
 
Interesting question.

What is your time horizon for spending this money? It seems very uncertain.

If you were definitely buying a house in Dublin or in Estonia in 24 months, then I would say stay in cash and live with the inflation.

But it's quite likely that you are not going to be spending this money for some time.

Under the circumstances, I think that you should be 100% invested in equities. Sure, they might go down before you spend the money, but the probability is that they will go up.

When you have definite plans to spend it to buy a house or to fund a move, move to cash.

Brendan
 
noonamer said:
Stocks, ETF, Crypto is more like an investment
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Stocks and ETFs are investments.

Crypto is a mad gamble. It is not an investment. You are betting that there will be bigger fools around when you go to sell it.

You cannot afford to gamble 20% of your wealth.

Forget the fact that you have lost €8k so far. Think of it like this. If you had €20k cash and no crypto would you gamble on it today? I hope that your answer is no. So if you would not buy it today, then you should sell it today.

Brendan
 
Thanks Brendan,
If you had €20k cash and no crypto would you gamble on it today? I hope that your answer is no. So if you would not buy it today, then you should sell it today.
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I'm really techy guy, so I'd put some money, probably not as big ratio tho. :D The once I have now, which I would buy they are still close to the profit, the once -8k is basically no reason to sell...
Under the circumstances, I think that you should be 100% invested in equities. Sure, they might go down before you spend the money, but the probability is that they will go up.
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Can you please elaborate this? You mean current cash or the future one?
 
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noonamer said:
I'm really techy guy, so I'd put some money, probably not as big ratio tho. :D The once I have now, which I would buy they are still close to the profit, the once -8k is basically no reason to sell...
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I don't really understand what you're trying to say here but it seems to be a rebuttal of @Brendan Burgess's sound advice.
 
Brendan Burgess said:
This is one of the problems of the crypto madness. "I understand the technology therefore it's a good investment"
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Probably that’s as stupid as it is, most chunk of it is staked which generates some not bad interest (about 200$ being 50% down). Price fluctuation surely the problem, but well the part I would be willing to sell is staked until the next year, second part (about 10k) I’d still keep as alternative investment (gambling).

I know that’s probably odd distribution between money: so much cash and a crypto, but when I was buying I set the goal not to sell until late 2024 early 2025, so I’d like to stick to that commitment.

I really do appreciate you making me to rethink it.
Brendan Burgess said:
Under the circumstances, I think that you should be 100% invested in equities. Sure, they might go down before you spend the money, but the probability is that they will go up.
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what did you mean by that? using current or future cash?
 
I mean that all your money which is currently in cryto and cash and future savings should be in equities along with what you have already in equities.

Brendan
 
noonamer said:
Probably that’s as stupid as it is, most chunk of it is staked which generates some not bad interest (about 200$ being 50% down). Price fluctuation surely the problem, but well the part I would be willing to sell is staked until the next year, second part (about 10k) I’d still keep as alternative investment (gambling).
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You're gambling with more than 20% of your overall assets when you want to move country and buy a property in 12-24 months. That's just bonkers.
 
ClubMan said:
You're gambling with more than 20% of your overall assets when you want to move country and buy a property in 12-24 months. That's just bonkers.
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yeah, thanks for highlighting it :D
I'll def consider selling them sooner, you have already put that pressure on me, highly appreciate really
 
Hey folks, bumping this thread, maybe I should create another one?
With considerations for timeframe, I decided to go with some equities by using some chunk of the spare cash. I have been buying VWCE for sake of diversification.
Curious if this still remains a good option, even if I have to sell small portion of it within next 3 years? or should I look for something else?
 
noonamer said:
Hey folks, bumping this thread, maybe I should create another one?
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I don't see why you need another thread?
noonamer said:
With considerations for timeframe, I decided to go with some equities by using some chunk of the spare cash. I have been buying VWCE for sake of diversification.
Curious if this still remains a good option, even if I have to sell small portion of it within next 3 years? or should I look for something else?
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Since you seem very unclear on your timeframe for moving abroad and buying property there (1-2 years has now become 3, or more?), @Brendan Burgess's earlier suggestions seem reasonable.

Time, and nobody here trying to predict the future, will tell if VWCE turns out to be a good investment but it seems reasonable from a diversification point if view as a medium/long term buy and hold investment point of view.
 
ClubMan said:
Since you seem very unclear on your timeframe for moving abroad and buying property there (1-2 years has now become 3, or more?)
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I mean, timeframe remains the same, but being more realistic and honest to myself we won't be buying anything in at least next 3 years. So yeah, I will stick to @Brendan Burgess's suggestion with pushing more into equities, but having a bit bigger emergency fund to cover relocation needs.
ClubMan said:
Time, and nobody here trying to predict the future, will tell if VWCE turns out to be a good investment but it seems reasonable from a diversification point if view as a medium/long term buy and hold investment point of view.
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oh, that's for sure, no one can predict the future and VWCE just a convenient way to diversify portfolio. My the only fear that I might need to sell some positions earlier than 5y (which is a shortest milestone for it) and have seen people are suggesting high-yield dividends ETF instead for such cases. But well, it is probably just an overthinking

Thanks for answering :)
 
noonamer said:
Monthly Expenses: Average of €1,500
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Well done living on €1,500 a month in Dublin as a married couple. I don’t think that’s sustainable though.
noonamer said:
a more affordable country like Poland, Lithuania, or Estonia,
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And keep your job in Dublin? Get a job in one of these countries?

I think be clear about objectives and then think about the financials, not the other way round.
 
NoRegretsCoyote said:
Well done living on €1,500 a month in Dublin as a married couple. I don’t think that’s sustainable though.
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we are doing a lot of budget planning in general, but this keeps getting harder with living cost increases. 1.5 year ago we were spending less than €1,000
NoRegretsCoyote said:
And keep your job in Dublin? Get a job in one of these countries?
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I work on IT, so most of the companies are having local branches within different countries (even current one), so shouldn’t be a problem.
They will just adjust salary to the country’s market.

Getting Dublin’s salary in a cheaper country would be nice, but I think really tax complicated :D
 
noonamer said:
I'm a 31-year-old married individual eagerly anticipating the arrival of our first child
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Is the anticipated child already imminent or is this pre planning?

No mention of this above but you are about to get a shock on your level of expenses…

I would not be investing anything in equities with such a short timeframe of around 3 years. I though conventional wisdom was 7+ years minimum.

Add in a potential change of country, a baby and new jobs into the mix. U need to De risk your savings completely.

50
 
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