Investing for your future
Most people have some form of savings in place. they can be for a specific purpose, like paying for your children’s education or saving for deposit on a house or home improvements. you may just want to build up a rainy day fund to deal with unexpected costs or you may have a lump sum you want to put away for the future. There are many ways you can go about investing your money and some of these include:
- Stocks and Shares
- Deposit Accounts
It is important to remember that investing does mean introducing some element of ‘risk’ to your money. Risk can result in making a gain on your investment but there is the possibility that you could lose some, or all, of your money.
With any investment product you need to thoroughly consider the level of risk involved before investing. How much risk you should take on depends on your own risk preference, your capacity to withstand risk and your financial objectives.
We will help you assess and measure your risk preference using risk questionnaires. Your risk capacity depends on your personal and financial circumstances – how much could you afford to lose? Objectives – what are you hoping to achieve with your fund? Is there a required return needed and are you and your family dependent on it? All of these elements come into play when assessing your risk profile.
We will give you the information you need to make the right investment decision based on your own financial circumstances, your attitude to risk and the length of time you want to put your money away.
Deciding where to best to invest is important but it is equally important to review the performance of your savings and investments on a regular basis. So whether you are looking for the best deposit rates available, building a savings fund or have a lump sum to invest we can provide the expert advice you need.
- Deposit accounts with all the major banks
- Regular savings accounts
Fixed term deposit accounts generally offer fixed interest rates which are higher than regular savings accounts. However, currently interest rates are at historic lows and there may be better value in longer term savings plans.
- Investment funds
A fund pools investors’ money together and uses it to purchase a mix of investments selected by the fund manager. Funds vary by what they invest in, be it shares in various markets, commercial property, government bonds etc. They also vary in terms of the aim of the fund aims and its risk profile. When you invest in a fund, you are also investing in the fund manager’s opinion, research and expertise, as well as the strength of the fund he or she manages.
- Longer term savings plans
These are available from life insurance companies and accumulate a lump sum over the longer term from regular monthly savings. They typically invest in investment funds as described above and are usually recommended for a minimum period of five years.
- Tracker or guaranteed investment bonds with capital security
These bonds typically lock up a lump sum for a period of around five years. At the term you are usually guaranteed to get back at least a high percentage of what you invested, together with a bonus related to the growth, if any, in specific multinational shares or specific stock market indices. If there is no growth then generally there is no bonus.
- Property Investments – including directly sourcing and purchasing commercial property on your behalf
The Irish property market is on the up and there is still good value out there particularly for cash buyers.
Factors to consider when choosing a savings and investment product
There a are number of different things to consider when choosing a savings and investment product:
- What is the recommended minimum term for the product?
Some products are best suited as short-term investments while others need a longer term view.
- What access, if any, will you have to your money?
Some products do not allow access during the term whilst others offer immediate access. Always check whether charges will be applied for early access.
- What is the investment risk?
Some products guarantee return of the full amount invested but many don’t and therefore include the risk of not getting back what you put in.
- Is the product geared towards providing an income or capital growth?
Some products are designed to provide an income along the way – others are aimed solely at capital growth.
- How will your returns be taxed?
How and when tax will be applied depends on the type of product, for example: deposit interest may be subject to Deposit Interest Retention Tax (DIRT) in the year the interest is credited to the account while gains from an investment policy may be subject to an “Exit Tax” deduction on maturity.
Investments can be complex but getting the right product for you can make a significant difference to your outcome, especially for longer term savings and investments. We can help you understand and guide you through the options available to you, and help you choose the products that will meet your needs.
Call us today for your no obligation consultation.
Warning: If you invest in any of these products you may lose some or all of the money you invest.