Thanks for the response Noel,Hi SuperMan.
Based on your plan, you will need access to cash at the drop of a hat for a property purchase. So you don’t have a lot of investment options. Whatever you invest in needs to be liquid and not too risky. That sounds like a bank account to me.
I would sell the stocks, metals, and bitcoin. As your investment horizon could be as short as one month, it is risky to hold this stuff, potentially suffer losses, and need to draw down a larger mortgage than otherwise necessary. Spread the cash into several bank accounts to ensure that it is all covered by deposit guarantees. You can find the best demand deposit rates in this thread.
I would see if I could contribute some of this very large cash pile as a lump sum into a pension and claim tax relief on the contribution. Separately, I would also step up regular monthly pension contributions to avail of generous income tax relief. Right now, you are doing your own DIY investing with your after-tax income. That's not very tax efficient and is a potentially expensive hobby if you don't know what you're doing.
I would set aside 3-6 months living expenses as an emergency fund and then use the rest of the cash (or as much as is needed) for a property purchase. I would aim to keep the mortgage balance as low as possible.
I would only consider investing my after-tax income if I had maxed out income tax relief on pension contributions, cleared any mortgage I had drawn down, and still had regular monthly savings to invest.
Do you really want to be viewing places for two years? You are wealthy and you say that your rent is affordable, so it’s not a big issue financially for you to wait. But you are well able to transact now on some of the most expensive properties in the state. Are you being too picky?
Thanks, I already am using Trade Republic, you suggesting just splitting into other like that?. I am not familiar with Bung.I agree with the above. Inflation beating investment is not guaranteed and would require a lot of risk that doesn't seem wise given the possible short investment horizon. By moving most or all of the €155k out of Irish banks deposit accounts and spread it across the likes of Bunq you should boost your deposit rate with no increase in risk.
On a side point if the aim of your wealth is to purchase a property then general inflation isn't the most relevant benchmark. Sure the CPI is increasing by 7.7% but you're not planning on buying €300k+ in Tesco or Aldi. The cost of you not purchasing a property in the last year is 3.2% i.e., the cost at which Dublin property increased over that time frame.
Yes, it's on the same link that @noelÓm provided. You can get a little extra on your new deposit for minimal effort.Thanks, I already am using Trade Republic, you suggesting just splitting into other like that?. I am not familiar with Bung.
I was speaking to someone from the US briefly yesterday.Yes, it's on the same link that @noelÓm provided. You can get a little extra on your new deposit for minimal effort.
I'd also be divesting from your risky assets if you're going to use those funds for the house purchase in the near term. Lock in those gains now so you've certainly in terms of your budget. Depending on price bracket it will also help reduce/avoid mortgage interest expense. If those investments cannot guarantee an after tax return equal to your mortgage rate you would be better off divesting.
If you can afford to buy for cash I wouldn't rule out taking out a mortgage:
1) re-saleability, if a lender is willing to lend to you for it then it goes someway to suggest it should be marketable of you want to sell it in the future.
2) if cashback options would allow for a quick profit ( assuming you can pay the mortgage back immediately).
You should never have cash assets in one currency (usd) and your liabilities in another (euro)I was speaking to someone from the US briefly yesterday.
They said they can get 4 percent rates on short term US treasuries over there but didnt go into much detail. Does anyone have any details on this, I guess not open to Irish?
How exactly do you believe that it's statistically likely?Small, tax free return ( not guaranteed, but statistically likely),
Not in the 4 weeks each year that the €250k prize is on offer.And you get the chance to win 50k every week....
Well, 135k of Prize Bonds is, likely to win a few 50 euro prizes per year. ( 0.35% tax free)How exactly do you believe that it's statistically likely?
Many people gave Prize Bonds for years and never win anything.
If the money is likely to be needed (e.g. for a house) imminently then better to put it on deposit for a guaranteed rate of return, even if marginal.
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