Wondering where to invest

A

AdamWrent

Registered User
Messages
12
Age: 29
Spouse’s/Partner's age: Single

Annual gross income from employment or profession: c€200,000

Type of employment: Self employed professional

In general are you spending more than you earn or are you saving? Saving

Rough estimate of value of home : 650,000
Amount outstanding on your mortgage: 490,000
What interest rate are you paying? 4.75% (Tracker ECB+0.75%)

Other borrowings – car loans/personal loans etc
None

Do you pay off your full credit card balance each month? Yes


Savings/investments: €50,000 in very low deposit account c3%
£50,000 in sterling in UK account c6%
€12,000 in Halifax saver account 4.5% (was 7%)
€1,500 in First Active regular saver 7%(just opened)
€150,000 in Current account

Do you have a pension scheme? Have been putting max 15% of income into pension since starting work 4 years ago.

Do you own any investment or other property? No

Ages of children: None


What specific question do you have or what issues are of concern to you?
I am currently earning a lot more than I spend or need. I have been reluctant to tie up any money in last couple of years due to the possibility of needing capital for my own business. This need has reduced somewhat. The bank have advised me that my business is very strong and would not have any problems getting any finances for capital expenditure. This has left me with a sizeable amount in my current account. I have considered an offset mortgage, but if there are better longer term strategies out there (considering I do expect to keep my earning at least where they are and hopefully increase) I am not adverse to some fairly high risk investments.

I suppose my main question is: should I stop being a conservative hoarder and put my current account balance somewhere useful or should I build up a large capital ready to 'pounce' if the right opportunity to make a huge gain comes along?

Thanks for any replies and the time you put into them.
 
AdamWrent said:
Age: 29
Spouse’s/Partner's age: Single

Annual gross income from employment or profession: c€200,000

Type of employment: Self employed professional

In general are you spending more than you earn or are you saving? Saving

Rough estimate of value of home : 650,000
Amount outstanding on your mortgage: 490,000
What interest rate are you paying? 4.75% (Tracker ECB+0.75%)

Other borrowings – car loans/personal loans etc
None

Do you pay off your full credit card balance each month? Yes


Savings/investments: €50,000 in very low deposit account c3%
£50,000 in sterling in UK account c6%
€12,000 in Halifax saver account 4.5% (was 7%)
€1,500 in First Active regular saver 7%(just opened)
€150,000 in Current account

Do you have a pension scheme? Have been putting max 15% of income into pension since starting work 4 years ago.

Do you own any investment or other property? No

Ages of children: None


What specific question do you have or what issues are of concern to you?
I am currently earning a lot more than I spend or need. I have been reluctant to tie up any money in last couple of years due to the possibility of needing capital for my own business. This need has reduced somewhat. The bank have advised me that my business is very strong and would not have any problems getting any finances for capital expenditure. This has left me with a sizeable amount in my current account. I have considered an offset mortgage, but if there are better longer term strategies out there (considering I do expect to keep my earning at least where they are and hopefully increase) I am not adverse to some fairly high risk investments.

I suppose my main question is: should I stop being a conservative hoarder and put my current account balance somewhere useful or should I build up a large capital ready to 'pounce' if the right opportunity to make a huge gain comes along?

Thanks for any replies and the time you put into them.
Click to expand...

God, you're in trouble there skip.

Spend a months wages on the most expensive financial advisor you can find.
 
Thanks, I think! Was considering seeing an authorised adviser but I have an issue over doing something active with my money for my own business or whether to keep taking money from it and investing. I've figured after a long expensive meeting he would say "I can't help you 'till you decide if you want this money invested or to use it for the business".
 
"I can't help you 'till you decide if you want this money invested or to use it for the business". - You're probably correct there. But he should be able to educate you on all options and advise what he/she thinks is best.
 
What line of business are you in to have ended up in such a strong position at the age of 29 if you don't mind me asking?
 
I’d plough as much as I can into a pension and I’d also reduce my mortgage to a LTV level where I could negotiate a lower interest rate,
Have you thought about Business Expansion Schemes or other such investments?
 
I think you need to allocate yourself an investment budget, you have (at a rough calculation) about €120k in savings accounts. I would suggest that you do go to a financial advisor but go with a specific sum of money that you want to work with, that way you will start learning on part of your wealth rather than all of it, might make it easier to spot that big opportunity when it comes along, or at least to understand what to look out for. If you look at it, you already have taken some risk in that you have sterling savings, which would have dropped in euro value over the last few months, aside of course from setting up your own business in the first place!!

Also is it worth considering paying more off your mortgage, seeing as how the interest on that is greater than the interest you are earning on your main Irish savings account.
 
AdamWrent said:
Thanks, I think! Was considering seeing an authorised adviser but I have an issue over doing something active with my money for my own business or whether to keep taking money from it and investing. I've figured after a long expensive meeting he would say "I can't help you 'till you decide if you want this money invested or to use it for the business".
Click to expand...

At the very least stick your excess current account balance into RaboDirect until you know what do to with it.

150k will generate about 400/month interest for you ( over 3 months )while you're in discussions with a financial adviser.

Might it be more tax efficent and expose you to less personal risk if you borrowed for expansion against the buisness, should the need arise?
 
If you dont mind me asking what business are you in? I wouldn't mind having your kind of problem :)
 
Thanks for all your thoughts. Ha ha, I seem to have had a string of expensive girls to maintain- the current one is relatively low maintenance.

I did look at BES but my accountant told me that he felt as investments they usually weren't the best and that i shouldn't invest for tax reasons alone. Do you agree?

I'm sorry but I'd rather not give the exact line of work I'm in. It's not a line of guaranteed wealth anyway, I've been a mixture of lucky and good at what I do.

I would like to thank you all so far for your thoughts, it's heartening that smart people are willing to help out strangers here out of their own goodness.
 
I'd agree, the point of investment isn't tax...
Have you considered setting any goals or aims for your money? Like I suggested a budget to be adventurous with would be a safe but perhaps beneficial first approach for you. But other than that, have you sat down and listed out
Short term goals (within the next year)
Medium term goals (within the next five years)
Long term goals (with the next 15 years)
and looked at how you can best use your money for these while keeping yourself in the style to which you've become accustomed?
What you want to achieve is a mix of higher risk investment with a view to maximum return and lower risk savings perhaps with a view to generating a guaranteed income from them.
 
So-crates, I like what you have said especially regarding writing down my goals in short, medium and long term goals. I suppose I've tended to work and dream of where I'd like to end up in twenty years without actually formulating a proper plan of action. I think I need to do this as a first step. Thanks for the advice.
 
You're welcome Adam. I know where you are coming from there, I have difficulty quantifying goals too, but it can be very rewarding to set that challenge and achieve it.
 
so-crates said:
I'd agree, the point of investment isn't tax...
Have you considered setting any goals or aims for your money? Like I suggested a budget to be adventurous with would be a safe but perhaps beneficial first approach for you. But other than that, have you sat down and listed out
Short term goals (within the next year)
Medium term goals (within the next five years)
Long term goals (with the next 15 years)
and looked at how you can best use your money for these while keeping yourself in the style to which you've become accustomed?
What you want to achieve is a mix of higher risk investment with a view to maximum return and lower risk savings perhaps with a view to generating a guaranteed income from them.
Click to expand...

I agree with Adam that's good advice.
 
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