Thank you Duke, appreciate your replies, I need to think about them, yes I’m a financial illiterate as regards some things, this website is not just for those who seem to know all about funds etc. As far as I know these schemes are supposed to be aimed at Joe & Mary Soap. So it has to be explained in an easy manner. I just don’t see anything 50k being aimed at those of you on here who are trading/investing. 50k is nothing.
Special Investment Accounts limits announced in Budget
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I beg to differ, here is an AI on a simple google
Two sources, from AI.
I knew this because I'd read some article about it in the last few weeks, that would have either been in the Indo or the Irish Times. That the idea of the savings scheme was to get at the 'problem' of Irish people keeping their savings in the banks. Now I've no idea who decided this needs to be sorted. I could hazard a guess. And I could also hazard a guess as to their motivation.
Until this thread I'd not really looked into it, thinking it was a new savings idea. It's to get people to take their money out of safe deposits into funds/markets etc. If you and the others think it's not for that reason, then what is the reason for it at all. 50K is nothing compared to the 170 billion in the deposits.
I assume some genius in Simon Harris's department has a figure for how much is going to come out of the 170 billion into this new scheme. That someone educated like you guys on here has done the math on this.
Perhaps some of you would venture a guess as to how much will flow into these funds from the savings accounts?
Djimi Traore
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This is why they're pushing for improved financial literacy. You are coming at this with a myriad of biases and assumptions from your own previous experience and you're not alone. Irish people need to move past Eircom shares and the financial crash and be willing to learn about investing with an open mind, not an assumption that it's all gambling. Even if you don't want any volatility you could invest in a money market fund and earn a tax-free return equivalent to a bank deposit.
Victor Carrera
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Two of the requirements are that you possess an Irish PPSN and be an Irish tax resident. If not you can ignore my earlier advice as it does not apply to you.
You're forgetting I made money on the Eircom shares, for which I borrowed to invest, like many. But I sold, immediately. Easy money. My bank here did a full and proper risk assessment on me, I'm so bad they could offer me nothing to invest in. But apparently I'm a gambler because of property. Me I just think some people are good at shares, some are good at cars, some are good at property, some are good in corporate, some are good at farming.
(my money is in a bank as I'm trying my level best to build, not helped by a very difficult county council - and I put a large whack back into a property investment that is working out very nicely )
Duke of Marmalade
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What is your interest in the Simonsaver?
So let's see what the Irish Times says:
Ireland’s new personal investment scheme: ‘What happens if I put €10,000 straight in?’
Better with Money with Aideen Finnegan
The personal investment accounts are being designed to tempt ordinary savers to take their money off deposit, where it’s earning little interest and losing value due to inflation, and put it into the stock market, where – over the long term – it is likely to rise in value.
So I'm right, it's to get people to take money out of their deposit accounts in the banks/credit unions. Love the word 'likely' there.
Duke said this was one of the reasons we don't
But the biggest barrier to ordinary Irish people investing their money is tax-reporting obligations that are complex and intimidating.
I don't agree with him or the article. And the article actually goes on and on about tax this and that, something most people don't probably think about at all as they don't know about those types of complex taxes. So to me it's a red herring.
The minute, and it is not written ANYWHERE, that the possibility of the 'fund' (savings) going down starts being written about, there will be carnage as regards this 'scheme'.
As far as I know every single ad I've heard in the last 20 years has a stock (your investments can go up or down ) nada in the Times or the Indo, I didn't even cop it myself until today. (as I thought it was some kind of incentivised saving scheme.
Words like Personal Investment Accounts - sounds great.
Great name.
I thought it might be something that gave a decent safe return. Until now it was a bit up in the air, so I didn't really concentrate on it until today. Safe is my main aim. Even though I'm aware of inflation eating capital. To get people to move they will need certaintity, to feel safe, to trust, all this talk of tax is just a side show.
Wolframius
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Bronte, with all due respect, what is your point? Are you salty because this account is not a SSIA 2.0? Are you upset because investment returns are directly correlated with risk? I don't understand.
It didn't come from irish government but from EU, the irish government had to be pushed into this. The reason is that the EU is falling behind the US and China in not developing global tech companies because europeans dont invest in european stocks but leave their money on deposit, ireland is actually way behind even our european colleagues. The EU wants to shift that mindset and high and complicated tax regimes especially like ireland's discouraged this. In the last 15 years the net wealth of US citizens has increased by 150K mainly because of their exposure to the US markets whereas in EU it has only increased by 50K , thats pretty stark. In fairness the tech bros in US hold a large portion of that stock market wealth
You are right though, "savings" should not have been used in the coverage about this scheme. Savings means zero-risk cash/deposits.
Yes you can move your savings into this account, but once you do they become investments, which carry risk.
but 1% regardless as to making money or not (or cystalising a gain) vs CGT with an allowance against crystalised profits.
And each year you have >50k in the saver account you pay tax on the portion over 50k. EACH YEAR. you pay the tax once for CGT.
When that comparison is established, I was wondering if they take into account private pensions or just savings? A lot of pensions would have some exposure to markets and also represent an important proportion of household assets.
Of course, it doesn't help that the media keep calling it a "savings scheme"
Have to be straight that there is, of course, risk; suspect the final products will have this in big red writing; bond-like products may well have less risk
Peter Browne made some good points on the radio earlier, in fairness, about a lot of uninitiated investors hitting the market at once and the calls to Liveline if there is a crash!
Have to be straight that there is, of course, risk; suspect the final products will have this in big red writing; bond-like products may well have less risk
Peter Browne made some good points on the radio earlier, in fairness, about a lot of uninitiated investors hitting the market at once and the calls to Liveline if there is a crash!
Duke of Marmalade
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But it isn't available to you as a non-resident.
Duke of Marmalade
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That was a very misleading comparison. The actual CBI report points this out. When pension savings and life assurance savings are included we are on a par with the rest.
Duke of Marmalade
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Agreed, but I was genuinely interested in what is motivating @Bronte's rather passionate interest in the initiative.
In fairness, you're quoting from news sources which try to distil information into a form that's digestible for the general public, and many of those news sources will put their own slant on the facts.
The idea that there was ever a goal to shift all or nearly all of that €170b on deposit into Simonsaver accounts (good name btw) - I don't buy that for a minute. The new accounts are absolutely not for everyone; there's a level of financial literacy and appetite for risk involved, and I don't think the members of this forum are a good cross-section of society in that respect.
Even if the new scheme was 100% everything you personally wanted it to be, it would still be a step too far for the average person.
Duke of Marmalade
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I experimented the other day with investing €50 through Revolut in a Vanguard ETF tracking the S&P 500. Absolutely child's play. So I was wondering where are the warnings. And with the help of AI I learn that they are required to have their Key Information Documents (KIDs) online. And indeed they do. I suppose I had to do KYC disclosure at some stage, I can't remember.
This is a farce of transparency but nonetheless, I struggle myself a bit with these KIDs, I think it is good that it is that easy to buy ETFs on the likes of Revolut.
So indeed there is a need for some ladybird financial literacy around this and AskAboutMoney is ideally placed to provide that free!