Where to start?

[lexi]

This is my first thread and wondering if anyone can give me advice on my finances so that I can start getting life together. I have 15k savings - and literally that is all I have. No pension, no house, no car..... It is all a bit daunting and I don't know where to start.

I have saved roughly €1,000 per month over the last 15 months in a BoI smart save account (all the disposable income I can afford) - I know that there are better savings schemes out there from reading some previous threads, but need a steer in the right direction. Do I invest in property? Do I continue saving? How much do I put in a pension and where?

My personal situation is that I am late 20’s, living in my boyfriend’s house. I probably qualify (earnings wise) for the affordable housing scheme, but if I remain living with him – I will not be an owner occupier – with the obvious implication of not being eligible. This also has implications if I would like to buy a place to rent out – I will be deemed an investor with the resulting tax implications – when really I’m just looking for a back up plan.

Does anyone have any good advice for my situation?

 

[ClubMan]

Where to start?

 

[lexi]

Sorry clubman - maybe my queries are a bit wishywashy anyway.. please feel free to delete...

L

 

[CCOVICH]

Rather than asking 'where to start', it could make just as much to ask 'where do I want to be in X years'.

For example:

Do you want to buy your own house (to occupy)? When? Where?
When do you want to retire? On what sort of pension?
Where do you see your career/salary in X years?

 

[brian1]

I have 15k savings - and literally that is all I have. No pension, no house, no car..... It is all a bit daunting and I don't know where to start.

Well the first thing is that you should be proud of yourself. You have started well and you are in far better shape then many people in your age group, who often have no savings and high cc debit, etc.

You are saving 1k a month which is a lot more then most people in your circumstances.

The first thing you should do right now, as in today, is:

1) Open a demand online savings account with rabodirect.ie and put 10k in it (you will get a 4.75% return on it).

2) Open a demand online savings account with northernrock-ireland.ie and put the remaining 5k in it (you will get a 4.15% return on it).

For your ongoing savings

3) Open a Halifax monthly saver account and put the maximum €750 a month into it (you'll get 6.65% return on it).
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4) Open an AIB Regular Savers Account and put the maximum €300 a month into it (you'll get 6.60% return on it).
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The reason why you should do these things right now, is that you'll get a good return on your money, it doesn't cost anything and you can take the money out of these accounts at anytime you want.

So even if you decide to buy a house in two months time, you can still take the money out of these accounts and have at least benefitted from two months of interest.

Once you have that done, your next step should be taken much more slowly and with great thought and it really depends on your circumstances and future plans.

Don't forget your pension, specially if you are paying tax at the higher rate, the earlier you start a pension, the better it will be in the end and the less it will cost monthly. Of course don't let it interefere with buying your own home etc.