Independent investment advice in Ireland is a rare thing, at least under current Central Bank of Ireland regulations. Currently, only an investment advice firm in Ireland that does not receive any form of commission can call themselves 'Independent'. So does that mean getting independent investment advice in Ireland is deeply flawed, not at all! This week I'll help you learn about;    Key considerations before you invest Knowing the source of your advice If any investment advice is truly impartial?  I hope it helps!

Independent investment advice in Ireland is a rare thing, at least under current Central Bank of Ireland regulations. Currently, only an investment advice firm in Ireland that does not receive any form of commission can call themselves 'Independent'. So does that mean getting independent investment advice in Ireland is deeply flawed, not at all! This week I'll help you learn about; <ul> <li>Key considerations before you invest</li> <li>Knowing the source of your advice</li> <li>If any investment advice is truly impartial?</li> </ul> I hope it helps!

5 Challenges to Independent Investment Advice in Ireland #268

If securing a high-quality retirement income is high on your agenda, nailing the answers to the following questions ought to be high on your list of priorities.  Whether you are just starting your career or approaching retirement age, 'today' is the next-best time to explore these, if you haven't already done so. With the intention of helping you make informed decisions, here are 9 important retirement planning questions to consider and answer.  I hope it helps!

If securing a high-quality retirement income is high on your agenda, nailing the answers to the following questions ought to be high on your list of priorities. Whether you are just starting your career or approaching retirement age, 'today' is the next-best time to explore these, if you haven't already done so. With the intention of helping you make informed decisions, here are 9 important retirement planning questions to consider and answer. I hope it helps!

Important Questions About Retirement Planning #267

This week we bring back episode one in the popular 'A Listerner's Journey' podcast series with William Lacey.   Throughout this series, William talks about his journey of escaping full-time employment. This is an insightful and helpful series that discusses many of the concerns, thoughts, priorities, and actions that many of us face as we transition to retirement.   If you enjoy episode one, you can listen to the rest of the series as follows:   Part 2Part 3Part 4Part 5     Enjoy!

This week we bring back episode one in the popular 'A Listerner's Journey' podcast series with William Lacey.   Throughout this series, William talks about his journey of escaping full-time employment. This is an insightful and helpful series that discusses many of the concerns, thoughts, priorities, and actions that many of us face as we transition to retirement.   If you enjoy episode one, you can listen to the rest of the series as follows:   <a href="https://informeddecisions.ie/escaping-full-time-employment-william-lacey-part-2-218/" rel="nofollow" target="_blank">Part 2</a><a href="https://informeddecisions.ie/escaping-full-time-employment-william-lacey-part-3-224/" rel="nofollow" target="_blank">Part 3</a><a href="https://informeddecisions.ie/escaping-full-time-employment-with-william-lacey-part-4-233/" rel="nofollow" target="_blank">Part 4</a><a href="https://informeddecisions.ie/escaping-full-time-employment-with-william-lacey-part-5-248/" rel="nofollow" target="_blank">Part 5</a>     Enjoy!

A Look Back at the Popular 'A Listener's Journey' Series #266

Lars Kroijer

While Paddy is off enjoying his annual leave we bring you a classic and popular podcast from 2021.  Lars is a former hedge fund manager, author, and entrepreneur from Denmark.  Can we beat the market? If we can’t what should we do? Lars and Paddy talk about investments, hedge funds, beating markets, and much more that we hope you will find helpful.

While Paddy is off enjoying his annual leave we bring you a classic and popular podcast from 2021.  Lars is a former hedge fund manager, author, and entrepreneur from Denmark.  Can we beat the market? If we can’t what should we do? Lars and Paddy talk about investments, hedge funds, beating markets, and much more that we hope you will find helpful.

Flashback To a Classic: Lars Kroijer Interview 'Can We Beat the Market' #265

Inheriting a house can be a significant financial event. It carries its own set of implications and considerations.  From taxes to inheritance thresholds, the financial aspects of inherited property can are worth considering if it is on your horizon, or that of your beneficiaries! In this week's podcast, I will explore:    The intricacies of inheriting a house in Ireland The implications of taxes and how they affect inheritance tax thresholds Why many people choose to sell an inherited home The benefits and drawbacks of such a decision 

Inheriting a house can be a significant financial event. It carries its own set of implications and considerations.  From taxes to inheritance thresholds, the financial aspects of inherited property can are worth considering if it is on your horizon, or that of your beneficiaries! In this week's podcast, I will explore: <ul> <li>The intricacies of inheriting a house in Ireland</li> <li>The implications of taxes and how they affect inheritance tax thresholds</li> <li>Why many people choose to sell an inherited home</li> <li>The benefits and drawbacks of such a decision</li> </ul>

Inheriting a House in Ireland #264

Like any individual in any profession, every Financial Advisor will have different strengths and weaknesses. They each have different skill sets. None of them are perfect, and I include myself in that!   In this short piece, I will delve into the importance of what financial advisors can do with and for their clients, even though many clients receiving said advice might not immediately recognise what they are actually helping them do, achieve and avoid!   Key Points    Avoiding fear-mongering Personalising the approach Keep investors on course, in 'good' and 'bad' times Taking time to provide the correct answer for you 

Like any individual in any profession, every Financial Advisor will have different strengths and weaknesses. They each have different skill sets. None of them are perfect, and I include myself in that! In this short piece, I will delve into the importance of what financial advisors can do with and for their clients, even though many clients receiving said advice might not immediately recognise what they are actually helping them do, achieve and avoid! Key Points <ul> <li>Avoiding fear-mongering</li> <li>Personalising the approach</li> <li>Keep investors on course, in 'good' and 'bad' times</li> <li>Taking time to provide the correct answer for you</li> </ul>

What We Need From Financial Advisors #263

This week we have something a little different. We recently hosted a webinar with Pension and Revenue expert Clive Slattery. If you missed the webinar, here is the audio, which I hope you find helpful. Clive will talk about recent PRSA changes.  - The implications for PAYE &amp; Business Owners - How &amp; Why these changes have come about - The significant tax opportunity that exists   PRSAs are relevant to most people as it is a pension that anyone can start. Thanks    Sunday Times Article

This week we have something a little different. We recently hosted a webinar with Pension and Revenue expert Clive Slattery. If you missed the webinar, here is the audio, which I hope you find helpful. Clive will talk about recent PRSA changes. - The implications for PAYE &amp; Business Owners - How &amp; Why these changes have come about - The significant tax opportunity that exists PRSAs are relevant to most people as it is a pension that anyone can start. Thanks <a href="https://www.linkedin.com/feed/update/urn:li:activity:7066373790796017664/" rel="nofollow" target="_blank"> Sunday Times Article</a>

Changes in Retirement Planning with Clive Slattery #262

What happens to my pension benefits if I suffer a death in service? (die while being an employee and a member of the company pension scheme!).   On a regular basis, we help clients to manage their pension planning, so as to avoid potential pitfalls in this area. Reason being, it has the potential to have a hugely negative impact on one's financial future.   What you'll learn:    How Personal Pension assets are treated on death (with simple example!) How Company Pension assets are treated on death (with worked example) How you can plan around the current rules for pensions in death in service  I hope it helps

What happens to my pension benefits if I suffer a death in service? (die while being an employee and a member of the company pension scheme!). On a regular basis, we help clients to manage their pension planning, so as to avoid potential pitfalls in this area. Reason being, it has the potential to have a hugely negative impact on one's financial future. What you'll learn: <ul> <li>How Personal Pension assets are treated on death (with simple example!)</li> <li>How Company Pension assets are treated on death (with worked example)</li> <li>How you can plan around the current rules for pensions in death in service</li> </ul> I hope it helps

Death In Service Pension Benefit #261 

This week we are joined by William Lacey who we followed on his transition to retirement in a series of podcasts. William talks about the lessons he has learned from his journey and the key things he would do if he were to transition to retirement again. The goal is to hopefully, by sharing his experiences help others that are on their retirement journey. I hope it helps

This week we are joined by William Lacey who we followed on his transition to retirement in a series of podcasts. William talks about the lessons he has learned from his journey and the key things he would do if he were to transition to retirement again. The goal is to hopefully, by sharing his experiences help others that are on their retirement journey. I hope it helps

3 Keys To Preparing For A Successful Retirement #260

This week I talk about Estate Planning; what to think about and what is important. While it might not be a topic that gets you all revved up, Estate Planning is considered to be a key aspect of managing one's long-term personal finances, regardless of how simple or complex their financial situation.      Key Estate Planning Points    Make use of the small gift exemption to the max you can Ensure you have a will in place Is section 72 really a good idea Estate planning is an essential part of your financial plan Things to consider, if Estate Planning is on your mind  I hope it helps.

This week I talk about Estate Planning; what to think about and what is important. While it might not be a topic that gets you all revved up, Estate Planning is considered to be a key aspect of managing one's long-term personal finances, regardless of how simple or complex their financial situation.  Key Estate Planning Points <ul> <li>Make use of the small gift exemption to the max you can</li> <li>Ensure you have a will in place</li> <li>Is section 72 really a good idea</li> <li>Estate planning is an essential part of your financial plan</li> <li>Things to consider, if Estate Planning is on your mind</li> </ul> I hope it helps.

Estate Planning: Should I Bother? #259

Take control of your financial future by joining us on Ireland's Independent &amp; award-winning Investment &amp; Retirement Planning Podcast, with Paddy Delaney (QFA RPA APA).Join Paddy &amp; guests as they cut through the noise, nonsense and smoke-n-mirrors of financial services in Ireland. We want you to avoid costly mistakes and to make informed financial decisions in your investments and retirement planning.Paddy Delaney QFA RPA APA

Everyone in Ireland should be listening to this podcast!

Paddy, host of Informed Decisions Financial Planning and Money Podcast, highlights all aspects of investing in this can&#39;t miss podcast.  Paddy along with the occasional expert guest offer insightful advice and tips helpful to anyone that listens!

Awesome Podcast

Take control of your financial future by joining us on Ireland's Independent &amp; award-winning Investment &amp; Retirement Planning Podcast, with Paddy Delaney (QFA RPA APA). Join Paddy &amp; guests as they cut through the noise, nonsense and smoke-n-mirrors of financial services in Ireland. We want you to avoid costly mistakes and to make informed financial decisions in your investments and retirement planning. Paddy Delaney QFA RPA APA

Informed Decisions Independent Financial Planning & Money Podcast

Many of us deal with budgets in a work environment, everything revolves around budgets. Yet for many the thoughts of budgeting our own finances seems alien! Paddy &amp; John discuss the merits and the ways to approach budgeting, and most importantly WHY bother! A large emphasis is on identifying your own personal Financial Goal, then and only then will budgeting be an activity you'll be motivated to actually do. Thanks so much for listening, you're a legend! Paddy.   Available on iTunes and Podcast Addict. Just search for 'Informed Decisions'.   For more check out www.informeddecisions.ie

Many of us deal with budgets in a work environment, everything revolves around budgets. Yet for many the thoughts of budgeting our own finances seems alien! Paddy &amp; John discuss the merits and the ways to approach budgeting, and most importantly WHY bother! A large emphasis is on identifying your own personal Financial Goal, then and only then will budgeting be an activity you'll be motivated to actually do. Thanks so much for listening, you're a legend! Paddy. Available on iTunes and Podcast Addict. Just search for 'Informed Decisions'. For more check out <a href="http://www.informeddecisions.ie" rel="nofollow" target="_blank">www.informeddecisions.ie</a>

Podcast #4:- Personal Finance Budgets.....the joys!

Welcome to Ireland’s award-winning investment and financial planning Blog &amp; Podcast. As our final Blog of 2019 I have given a lot of thought about what message I would love to share. I have imagined that this was the last ever thing we write, and reflected on what we'd want to share. By the way, unless I unexpectedly die over the holidays it won't be the last ever piece - which you may or may not see as a positive! Paddy Delaney

Welcome to Ireland’s award-winning investment and financial planning Blog &amp; Podcast. As our final Blog of 2019 I have given a lot of thought about what message I would love to share. I have imagined that this was the last ever thing we write, and reflected on what we'd want to share. By the way, unless I unexpectedly die over the holidays it won't be the last ever piece - which you may or may not see as a positive! Paddy Delaney

Podcast 162: Markets at My Birth

'What should I do with an inheritance' and 'How should I invest an inheritance' are questions we might never hope to need to consider but many are forced to consider these every year here in Ireland. This week in Ireland's award-winning and unbiased personal finance blog I hope share some insights which might be of value to anyone that does every find themselves faced with this question. The reason I guess that this is a relevant topic here is because I have seen several cases where people inherit money, then act irrationally or in ways that is to their own detriment, and they end up blowing the lot on senseless stuff that they wound up regretting a short time later. That is hardly a respectful way to behave with the likely hard-earned legacy that a loved-one has left you!? Likewise I have seen some people handle it really well and have made decisions that have supported their goals, and the result being the inheritance was a positive impact on their life. Surely, a better outcome! I'm out to help even a handful of people to avoid that same regret. Read full blog here. Paddy Delaney QFA RPA APA Coach

'What should I do with an inheritance' and 'How should I invest an inheritance' are questions we might never hope to need to consider but many are forced to consider these every year here in Ireland. This week in Ireland's award-winning and unbiased personal finance blog I hope share some insights which might be of value to anyone that does every find themselves faced with this question. The reason I guess that this is a relevant topic here is because I have seen several cases where people inherit money, then act irrationally or in ways that is to their own detriment, and they end up blowing the lot on senseless stuff that they wound up regretting a short time later. That is hardly a respectful way to behave with the likely hard-earned legacy that a loved-one has left you!? Likewise I have seen some people handle it really well and have made decisions that have supported their goals, and the result being the inheritance was a positive impact on their life. Surely, a better outcome! I'm out to help even a handful of people to avoid that same regret. <a href="https://www.informeddecisions.ie/?p=5359&amp;preview=true" rel="nofollow" target="_blank">Read full blog here.</a> Paddy Delaney QFA RPA APA Coach

Podcast124: What Should I Do WIth An Inheritance

Hi, Welcome Back! It was in my 'schedule of topics to blog about' and it seems it is timely as in the past 3 weeks only I have been asked about the above topic on 3 different occasions. In addition to that my present wife &amp; I have just returned from a weekend city break to UK, and there is no doubt that flashing the oul' Credit Card around the place is an easy pit to fall into, hence the reason I don't currently operate a Credit Card (&amp; hence why I use the term present wife!!). The 3 people I have chatted to about the issue of Credit Cards in the past few weeks all have or have recently had fairly sizeable amounts owing on their cards, and all for various reasons. One was to pay day to day bills on a 1-income household and to tie them over till pay-day, another was an accumulation of expenses for house furniture and electronics, and the other was a big blow-out holiday last year. Each of them were really aware of the debt, however what was surprising was that two of the individuals were paying the minimum monthly payment only, and not making a concerted effort to clear the actual loan. Upon speaking to them this was not due to an inability to repay the debt but a lack of awareness of the cost of the debt. We are out to fix that in this week's Blog! How Do Credit Cards Work? Credit Cards may seem to many as a Celtic Tiger thing, when we over-indulged and purchased luxury items at a rate of knots and never bothered repaying them, only for the levels of personal unsecured debt to spiral out of control. They were, but they haven't gone away! Credit Cards are still a phenomenally profitable product for the providers, because for that very reason; many of us don't clear them each month and therefore pay really high interest on the balances and are exactly the type of customer which will generate very healthy profits for the providers. As outlined in our most popular Blog#3 we shared 5 basic principles in managing our finances, clearing debt and Credit Cards was one of them! So how not to do it? The following are the steps involved in your being an ideal customer for a Credit Card provider:  You Apply For Credit Card You Are Given Credit Card You Buy 'Stuff' On Credit Card You Repay The Minimum Repayment Amount Each Month (e.g. €10-€20 per month) You Are Charged The Maximum Interest On The Outstanding Balance (15-30%!) You Stay In This Pattern &amp; Said Company Make Lots of Profit From You  If you were to follow steps 1, 2 &amp; 3 however on step 4 you actually clear the balance the Credit Card provider will make next to nothing from your custom. Typically you can get between 30 and 60 days interest free credit on a Credit Card, which can be very handy! It is only when Credit Card users start coughing up the massive interest that the provider's gravy train rolls in! The minimum repayment amount is a figure which will you are invited to repay on the card after a certain period of time of their being a balance outstanding on the card. Paying that amount will go nowhere near clearing your debt over a short period of time, typically it is a figure which will go towards paying the interest you owe at that point in time on the balance outstanding, plus fees. Therefore it is important to note that merely paying the minimum repayment amount is not in your best interests, if you can at all afford to pay more! Why Get A Credit Card? They are shocking handy! In the past they were particularly useful when we did not have Visa Debit Cards or indeed didn't use cheque books (how many of us here every wrote a cheque I wonder!?) and you needed to make purchases for items such as travel expenses etc. They quickly became a really convenient form of on demand personal loan, which is where it can get dangerous. However in today's society of 'see it- want it- buy it' the Credit Card can be a way of getting what you want without having to save for it, which in my book (not an actual book, yet!) is a habit which will erode your savings capacity and future wealth massively. Can I Get A Credit Card Now? After a few years of silence we now see providers back in the market of issuing Credit Cards; we are being enticed with cash-back offers, discounts on grocery bills, complimentary travel insurance and low introductory rates. We will shortly get to the latter and how it can be of real assistance to you in managing your Credit Card balance. So yes, provided you have a reasonable income and a reasonably clear credit history most providers will be open to doing business with you. The providers are not giving these incentives for your benefit, they are profitable products and generate lots of income for them because many of us (including yours truly before I saw the light!) are often quick to purchase and slow to repay, a Credit Card provider's dream! What Is My Credit Card Costing Me? Every Credit Card attracts a €30 Stamp Duty fee per annum, no avoiding that one, unless you don't have one! We will run through an example of the cost of having a credit card and the interest payable on it, for illustration. Credit Card Balance Outstanding €5,000 Rate of Interest is 23% If you are paying €120 per month you might think that you are making progress, however it will take approximately 7 years to repay the €5,000 (assuming you cut up the card now and make no more purchases!). 7 years! Totaling just over €10,000 in repayments, €10,000! If you decide you can pay more and repay €200 per month, you will have €5,000 cleared in just under 3 years time, a much much shorter period of time, and a much much lower amount of interest. Total Repayment of €6,900 approx. It is still a very saucy amount of interest, the typical rates of interest of 18-25% are really high and even over 3 years as above on a smallish amount can be quite difficult to stomach. Should I Clear My Credit Card As Early As Possible? Eh, yes! If you have the means to do so immediately then it can be a very prudent thing to do. Say you have €5,000 in the bank, and you have a €5,000 credit card debt it makes a lot of financial sense to clear that debt, and then start building your emergency, retirement, education funds etc thereafter. Purely on the basis of the prohibitive cost of the Credit Card. Is There Another Way To Clear My Credit More Effectively? Yes, potentially. There are 2 angles to tackle this from. The first is the good old fashioned 'ask for a discount' approach. It has been known to work in the past. If you contact your provider and ask them to reduce the rate on your outstanding balance, they may just do it! Secondly, I mentioned above that many providers offer an introductory discounted rate, and indeed most offer 0% balance transfers. Essentially what that means is that once your are granted the card you can transfer your outstanding balance from the old card to the new card and not pay any interest on that for a period of typically 6 months. This allows you the opportunity to really pay off the actual loan of €5,000 and not just interest. If you were to do this, and even if you don't get a better rate than the illustrated 23% on your existing card it can have a massively positive impact on the time it takes to clear the debt (again assuming you cut up the card on receipt of it so you don't use it!). In the above example your €120 would have this new card cleared in just over 5 years instead of 7 years. Might not sound earth shattering however that is a saving of  €2,800 approx, on a debt of €5,000. Massive! In the case of the €200 monthly payment example you would have your debt cleared in less than 2 and a half years instead of 2 years 11 months, which is a saving of €1,200 on a €5,000 debt! I was delighted to hear in one of the cases at the start of this piece that the couple who were telling me about their need to use the Credit Card to tie them over till pay-day have managed to clear their Credit Card debt, it is a financial as well as emotional weight lifted and allows them to focus on managing their money in a proactive way and to plan for some family events and milestones which are very close to their hearts, so well done to you guys down in Limerick, you know who you are! As always I need your help and support in spreading the Informed Decisions word so please do share this with anyone who you believe may benefit from the information, and if you have yet to please do take the 4 minutes involved in completing the Annual Informed Decisions Survey. Many thanks for your interest and for sharing the love. Paddy.

Hi, Welcome Back! It was in my 'schedule of topics to blog about' and it seems it is timely as in the past 3 weeks only I have been asked about the above topic on 3 different occasions. In addition to that my present wife &amp; I have just returned from a weekend city break to UK, and there is no doubt that flashing the oul' Credit Card around the place is an easy pit to fall into, hence the reason I don't currently operate a Credit Card (&amp; hence why I use the term present wife!!). The 3 people I have chatted to about the issue of Credit Cards in the past few weeks all have or have recently had fairly sizeable amounts owing on their cards, and all for various reasons. One was to pay day to day bills on a 1-income household and to tie them over till pay-day, another was an accumulation of expenses for house furniture and electronics, and the other was a big blow-out holiday last year. Each of them were really aware of the debt, however what was surprising was that two of the individuals were paying the minimum monthly payment only, and not making a concerted effort to clear the actual loan. Upon speaking to them this was not due to an inability to repay the debt but a lack of awareness of the cost of the debt. We are out to fix that in this week's Blog! How Do Credit Cards Work? Credit Cards may seem to many as a Celtic Tiger thing, when we over-indulged and purchased luxury items at a rate of knots and never bothered repaying them, only for the levels of personal unsecured debt to spiral out of control. They were, but they haven't gone away! Credit Cards are still a phenomenally profitable product for the providers, because for that very reason; many of us don't clear them each month and therefore pay really high interest on the balances and are exactly the type of customer which will generate very healthy profits for the providers. As outlined in our most popular <a href="http://www.informeddecisions.ie/blog3-stepping-stones/" rel="nofollow" target="_blank">Blog#3</a> we shared 5 basic principles in managing our finances, clearing debt and Credit Cards was one of them! So how not to do it? The following are the steps involved in your being an ideal customer for a Credit Card provider: <ol> <li>You Apply For Credit Card</li> <li>You Are Given Credit Card</li> <li>You Buy 'Stuff' On Credit Card</li> <li>You Repay The Minimum Repayment Amount Each Month (e.g. €10-€20 per month)</li> <li>You Are Charged The Maximum Interest On The Outstanding Balance (15-30%!)</li> <li>You Stay In This Pattern &amp; Said Company Make Lots of Profit From You</li> </ol> If you were to follow steps 1, 2 &amp; 3 however on step 4 you actually clear the balance the Credit Card provider will make next to nothing from your custom. Typically you can get between 30 and 60 days interest free credit on a Credit Card, which can be very handy! It is only when Credit Card users start coughing up the massive interest that the provider's gravy train rolls in! The minimum repayment amount is a figure which will you are invited to repay on the card after a certain period of time of their being a balance outstanding on the card. Paying that amount will go nowhere near clearing your debt over a short period of time, typically it is a figure which will go towards paying the interest you owe at that point in time on the balance outstanding, plus fees. Therefore it is important to note that merely paying the minimum repayment amount is not in your best interests, if you can at all afford to pay more! Why Get A Credit Card? They are shocking handy! In the past they were particularly useful when we did not have Visa Debit Cards or indeed didn't use cheque books (how many of us here every wrote a cheque I wonder!?) and you needed to make purchases for items such as travel expenses etc. They quickly became a really convenient form of on demand personal loan, which is where it can get dangerous. However in today's society of 'see it- want it- buy it' the Credit Card can be a way of getting what you want without having to save for it, which in my book (not an actual book, yet!) is a habit which will erode your savings capacity and future wealth massively. Can I Get A Credit Card Now? After a few years of silence we now see providers back in the market of issuing Credit Cards; we are being enticed with cash-back offers, discounts on grocery bills, complimentary travel insurance and low introductory rates. We will shortly get to the latter and how it can be of real assistance to you in managing your Credit Card balance. So yes, provided you have a reasonable income and a reasonably clear credit history most providers will be open to doing business with you. The providers are not giving these incentives for your benefit, they are profitable products and generate lots of income for them because many of us (including yours truly before I saw the light!) are often quick to purchase and slow to repay, a Credit Card provider's dream! What Is My Credit Card Costing Me? Every Credit Card attracts a €30 Stamp Duty fee per annum, no avoiding that one, unless you don't have one! We will run through an example of the cost of having a credit card and the interest payable on it, for illustration. Credit Card Balance Outstanding €5,000 Rate of Interest is 23% If you are paying €120 per month you might think that you are making progress, however it will take approximately 7 years to repay the €5,000 (assuming you cut up the card now and make no more purchases!). 7 years! Totaling just over €10,000 in repayments, €10,000! If you decide you can pay more and repay €200 per month, you will have €5,000 cleared in just under 3 years time, a much much shorter period of time, and a much much lower amount of interest. Total Repayment of €6,900 approx. It is still a very saucy amount of interest, the typical rates of interest of 18-25% are really high and even over 3 years as above on a smallish amount can be quite difficult to stomach. Should I Clear My Credit Card As Early As Possible? Eh, yes! If you have the means to do so immediately then it can be a very prudent thing to do. Say you have €5,000 in the bank, and you have a €5,000 credit card debt it makes a lot of financial sense to clear that debt, and then start building your emergency, retirement, education funds etc thereafter. Purely on the basis of the prohibitive cost of the Credit Card. Is There Another Way To Clear My Credit More Effectively? Yes, potentially. There are 2 angles to tackle this from. The first is the good old fashioned 'ask for a discount' approach. It has been known to work in the past. If you contact your provider and ask them to reduce the rate on your outstanding balance, they may just do it! Secondly, I mentioned above that many providers offer an introductory discounted rate, and indeed most offer 0% balance transfers. Essentially what that means is that once your are granted the card you can transfer your outstanding balance from the old card to the new card and not pay any interest on that for a period of typically 6 months. This allows you the opportunity to really pay off the actual loan of €5,000 and not just interest. If you were to do this, and even if you don't get a better rate than the illustrated 23% on your existing card it can have a massively positive impact on the time it takes to clear the debt (again assuming you cut up the card on receipt of it so you don't use it!). In the above example your €120 would have this new card cleared in just over 5 years instead of 7 years. Might not sound earth shattering however that is a saving of  €2,800 approx, on a debt of €5,000. Massive! In the case of the €200 monthly payment example you would have your debt cleared in less than 2 and a half years instead of 2 years 11 months, which is a saving of €1,200 on a €5,000 debt! I was delighted to hear in one of the cases at the start of this piece that the couple who were telling me about their need to use the Credit Card to tie them over till pay-day have managed to clear their Credit Card debt, it is a financial as well as emotional weight lifted and allows them to focus on managing their money in a proactive way and to plan for some family events and milestones which are very close to their hearts, so well done to you guys down in Limerick, you know who you are! As always I need your help and support in spreading the Informed Decisions word so please do share this with anyone who you believe may benefit from the information, and if you have yet to please do take the 4 minutes involved in completing the <a href="http://www.informeddecisions.ie/survey" rel="nofollow" target="_blank">Annual Informed Decisions Survey.</a> Many thanks for your interest and for sharing the love. Paddy.

Podcast #25: How To Destroy That Credit Card Balance, Quickly!

For many establishing an emergency fund may seem like an unnecessary hassle, or indeed an impossible mountain to climb. Your new co-host, and Paddy discuss the ins and outs and ways to get started on this journey. This is the first Podcast the 2 guys have embarked on together, so go easy on them! Thanks for tuning in. Paddy.   Now available on iTunes for iPhone, and Podcast Addict for all Android.   Or visit the site for more info.... www.informeddecisions.ie

For many establishing an emergency fund may seem like an unnecessary hassle, or indeed an impossible mountain to climb. Your new co-host, and Paddy discuss the ins and outs and ways to get started on this journey. This is the first Podcast the 2 guys have embarked on together, so go easy on them! Thanks for tuning in. Paddy. Now available on iTunes for iPhone, and Podcast Addict for all Android. Or visit the site for more info.... <a href="http://www.informeddecisions.ie" rel="nofollow" target="_blank">www.informeddecisions.ie</a>

Podcast #3 - Emergency Funding

'Mind the pennies and the pounds will look after themselves' is a well-worn saying, the origin of which I have no idea! While it might give the perception of being 'mean' or 'tight' I reckon it's basis is in being proactive and deliberate in our approach to managing our personal finances. This week I share 10 small changes that can have a siginificant and positive result for you as an investor, saver or retiree. I hope it helps. Paddy.

'Mind the pennies and the pounds will look after themselves' is a well-worn saying, the origin of which I have no idea! While it might give the perception of being 'mean' or 'tight' I reckon it's basis is in being proactive and deliberate in our approach to managing our personal finances. This week I share 10 small changes that can have a siginificant and positive result for you as an investor, saver or retiree. I hope it helps. Paddy.

Personal Finance....Small Changes Big Difference - Podcast 155

Hi there! Investments can be ferociously complex things, and made even more complex by some, for their benefit and not yours! This episode of the Informed Decisions Personal Finance podcast shares some basic insights to the 5 main Asset Classes, giving you a working understanding of what they each are and what sort of volatility they each tend to carry. Valuable listening whether you are a newcomer to the world of savings, investing or pension planning in Ireland, or are a seasoned regular. Please visit the website www.informeddecisions.ie for access to all of our blogs and podcasts. Thanks for listening and sharing. Paddy.

Hi there! Investments can be ferociously complex things, and made even more complex by some, for their benefit and not yours! This episode of the Informed Decisions Personal Finance podcast shares some basic insights to the 5 main Asset Classes, giving you a working understanding of what they each are and what sort of volatility they each tend to carry. Valuable listening whether you are a newcomer to the world of savings, investing or pension planning in Ireland, or are a seasoned regular. Please visit the website <a href="http://www.informeddecisions.ie" rel="nofollow" target="_blank">www.informeddecisions.ie</a> for access to all of our blogs and podcasts. Thanks for listening and sharing. Paddy.

Podcast #11: Asset Class Basics & Diversifying Your Investments & Savings

Hi again dear listener! If you are new here, welcome! This is a great place to begin the journey if you are a new visitor. This is the 2nd in our 'financial foundations' series, and will further explain one of the many protection options available to us all in today's market. For the first in this series we looked at the ins and outs of specified illness cover. Click here to listen.     Income Protection, also known in some quarters as Income Continuance, Income Insurance, Income Cover &amp; Permanent Heath Insurance. Confused yet!!? I'm gonna stick with the label of Income Protection on this one, purely because that is what it is designed to do, protect your income if yours stops! Before we get into the basics of this potential financial foundation lets picture the following. (Disclaimer: this might seem like an old insurance sales technique but bear with me!!). Imagine for a second that you had a printer in the corner of your bedroom, every morning as you wake up you hear this printer printing out the equivalent of a day's wages for you. Because there is no such thing as work in this dream-land you survive on your printer's ability to print this money for you every morning. Having said that, like all printers on this planet yours is prone to breaking down occasionally, indeed it is also susceptible to breaking down permanently. If it does your income will stop, cease, finish. Bearing in mind it is your sole form of income would you insure this printer against such an incident, bearing in mind it is your sole form of income? If you woke up one morning and it was all flashing red lights would you feel it prudent to have a back-up plan to help pay the bills? On the face of it it probably seems like pure gambling to not do so, yet the fact is that a huge percentage of us do not have such a plan in place. If we go back to the analogy of building a home on solid foundations, it would seem that doing so without a core foundation would be a risky approach. So why don't people have this protection in place? Personally I believe there are a few core reasons for that; cost, awareness and understanding of what it actually is! So here goes............. What is it? As already mentioned above, it is a type of protection which should pay you an income if you are medically unable to work for a minimum period of time due to an accident, illness or injury. As with the majority of income sources it is taxable.  (You will note that this is quite different to Specified Illness Cover which pays you a lump sum (one-off) upon diagnosis of a certain type of illness, and not related to your ability to continue to work or not). So its Sick Pay, right? No! Typically 'sick pay' from an employer is paid for a set period of time, for example 2, 6, 12 months, after which time the benefit stops and you are on your own. Income Protection however is designed to continue to provide the income benefit until either a)  you are deemed medically able to return to work or b) your protection plan reaches the end of its term, you can select usually between 55 and 65 years of age, at which point the benefit stops. What about the State Disability Benefit? Importantly receiving Income Protection, while it is a taxable income, does not immediately impact on your ability to receive your entitlement to State Benefits. The State 'Illness Benefit' is paid for a maximum of: a) 2 years if you have at least 260 (5years) weeks reckonable social insurance contributions paid since you first started work b) 1 year if you have between 104 and 259 weeks reckonable social insurance contributions* paid since you first started work How much Income do I get from an Income Protection Plan? Depends on how much your printer prints each morning! You can protect up to a max of 75% of your Gross Income with one of these plans. When/If you do claim as a result of being unable to work you make your claim, have it supported by medical evidence of you being unable to work, and the insurance company essentially become your employer, they deduct the tax payable and you get the Net Income paid into your bank account. Example: You are 34 years of age, an Accountant, non-smoker. Your income is €50k. You put in place an Income Protection plan which will cover 75% of your income (€38k per annum benefit). You are married and 1 child. Your spouse is working also. If you were to become ill/injured/sick for a minimum of 1 week you could apply for State Disability Benefit, if successful it would provide in the region of €940 per month. (11k per annum). How Much Does it Cost? The above plan would cost in the region of €130 per month to put in place. Do note however that the Revenue recognise the importance of having this in place and have generous tax relief available on the cost of putting it in place, so if our Accountant above was on the 40% tax rate his actual cost would be around the €70 per month mark...........not bad for a potential monthly benefit of €3,167 if in a claim, and a claim which could last from now until he/she gets to 60 years of age! Worth noting that the more physically perilous or manual your occupation the more expensive the cover would be for you. Who Can Have It? A lot of folks might want it but not everyone can get it! Typically anyone in an occupation which involved mostly driving or very heavy manual labour can have difficulty in getting an application through what is often very rigorous underwriting/assessment. But once you have it you have it! If you are not sure if your occupation would qualify you can easily check this by 'googling' income protection quotes, and they all ask you your occupation, before either quoting you or saying 'thanks but no thanks'! Likewise, if you have previous medical history or medical/physical illnesses or conditions it may impact on you getting the cover at 'standard rates', which simply means at the price you were quoted for, and covering you for all eventualities. Are There Any Down-Sides? Like everything, it is important to know what you are covered for and what you are not covered for with these types of things. For example, you would likely not be covered if you were out of work due to an illness/injury suffered as a result of something you did while under the influence of alcohol, so no climbing trees or lamp-posts after a trip to the 'local'! Another thing to watch out for, is if you intend traveling for a period of time, as in moving to another country. Most plans will only pay you for a short period of time if you are living abroad at the time of claim, so it's one to be aware of if this might apply to you. As always, read the details, be informed of all the facts. You need to be medically certified as unable to work, if this is not the case then a company would likely refuse your application. The company covering you are charging you a price which will ensure they make a profit, pay the advisor/agent, and also ensures that other people who have the cover will get paid if they have a valid claim, so it is in everyone's interest to be upfront and honest about what is and what is not covered, and when it would or would not be paid. Conclusion? As always I will leave it to you to form your own conclusions on this. If your income stopping would have a massive impact on your financial, physical or mental well-being then it could be a worthwhile foundation for you. If you feel the State Benefit would not be sufficient, and you have few other crutches to support you should you be out of work for a considerable period of time, then it could be worth considering, big-time! Please use this information in the manner it is intended, inform yourself and supporting you in creating a better financial future for yourself. Thanks so much for reading, sharing and spreading the word. Paddy Delaney (QFA, RPA &amp; Now Qualified Coach too- yay!!)

Hi again dear listener! If you are new here, welcome! <a href="http://www.informeddecisions.ie/about/" rel="nofollow" target="_blank">This</a> is a great place to begin the journey if you are a new visitor. This is the 2nd in our 'financial foundations' series, and will further explain one of the many protection options available to us all in today's market. For the first in this series we looked at the ins and outs of specified illness cover. Click <a href="http://www.informeddecisions.ie/blog-18-specified-illness-cover/" rel="nofollow" target="_blank">here to listen</a>. <a href="https://itunes.apple.com/ie/podcast/informed-decisionss-personal/id1150625286?mt=2" rel="nofollow" target="_blank"> </a> Income Protection, also known in some quarters as Income Continuance, Income Insurance, Income Cover &amp; Permanent Heath Insurance. Confused yet!!? I'm gonna stick with the label of Income Protection on this one, purely because that is what it is designed to do, protect your income if yours stops! Before we get into the basics of this potential financial foundation lets picture the following. (Disclaimer: this might seem like an old insurance sales technique but bear with me!!). Imagine for a second that you had a printer in the corner of your bedroom, every morning as you wake up you hear this printer printing out the equivalent of a day's wages for you. Because there is no such thing as work in this dream-land you survive on your printer's ability to print this money for you every morning. Having said that, like all printers on this planet yours is prone to breaking down occasionally, indeed it is also susceptible to breaking down permanently. If it does your income will stop, cease, finish. Bearing in mind it is your sole form of income would you insure this printer against such an incident, bearing in mind it is your sole form of income? If you woke up one morning and it was all flashing red lights would you feel it prudent to have a back-up plan to help pay the bills? On the face of it it probably seems like pure gambling to not do so, yet the fact is that a huge percentage of us do not have such a plan in place. If we go back to the analogy of building a home on solid foundations, it would seem that doing so without a core foundation would be a risky approach. So why don't people have this protection in place? Personally I believe there are a few core reasons for that; cost, awareness and understanding of what it actually is! So here goes............. What is it? As already mentioned above, it is a type of protection which should pay you an income if you are medically unable to work for a minimum period of time due to an accident, illness or injury. As with the majority of income sources it is taxable.  (You will note that this is quite different to Specified Illness Cover which pays you a lump sum (one-off) upon diagnosis of a certain type of illness, and not related to your ability to continue to work or not). So its Sick Pay, right? No! Typically 'sick pay' from an employer is paid for a set period of time, for example 2, 6, 12 months, after which time the benefit stops and you are on your own. Income Protection however is designed to continue to provide the income benefit until either a)  you are deemed medically able to return to work or b) your protection plan reaches the end of its term, you can select usually between 55 and 65 years of age, at which point the benefit stops. What about the State Disability Benefit? Importantly receiving Income Protection, while it is a taxable income, does not immediately impact on your ability to receive your entitlement to State Benefits. The State 'Illness Benefit' is paid for a maximum of: a) 2 years if you have at least 260 (5years) weeks reckonable social insurance contributions paid since you first started work b) 1 year if you have between 104 and 259 weeks reckonable social insurance contributions* paid since you first started work How much Income do I get from an Income Protection Plan? Depends on how much your printer prints each morning! You can protect up to a max of 75% of your Gross Income with one of these plans. When/If you do claim as a result of being unable to work you make your claim, have it supported by medical evidence of you being unable to work, and the insurance company essentially become your employer, they deduct the tax payable and you get the Net Income paid into your bank account. Example: You are 34 years of age, an Accountant, non-smoker. Your income is €50k. You put in place an Income Protection plan which will cover 75% of your income (€38k per annum benefit). You are married and 1 child. Your spouse is working also. If you were to become ill/injured/sick for a minimum of 1 week you could apply for State Disability Benefit, if successful it would provide in the region of €940 per month. (11k per annum). How Much Does it Cost? The above plan would cost in the region of €130 per month to put in place. Do note however that the Revenue recognise the importance of having this in place and have generous tax relief available on the cost of putting it in place, so if our Accountant above was on the 40% tax rate his actual cost would be around the €70 per month mark...........not bad for a potential monthly benefit of €3,167 if in a claim, and a claim which could last from now until he/she gets to 60 years of age! Worth noting that the more physically perilous or manual your occupation the more expensive the cover would be for you. Who Can Have It? A lot of folks might want it but not everyone can get it! Typically anyone in an occupation which involved mostly driving or very heavy manual labour can have difficulty in getting an application through what is often very rigorous underwriting/assessment. But once you have it you have it! If you are not sure if your occupation would qualify you can easily check this by 'googling' income protection quotes, and they all ask you your occupation, before either quoting you or saying 'thanks but no thanks'! Likewise, if you have previous medical history or medical/physical illnesses or conditions it may impact on you getting the cover at 'standard rates', which simply means at the price you were quoted for, and covering you for all eventualities. Are There Any Down-Sides? Like everything, it is important to know what you are covered for and what you are not covered for with these types of things. For example, you would likely not be covered if you were out of work due to an illness/injury suffered as a result of something you did while under the influence of alcohol, so no climbing trees or lamp-posts after a trip to the 'local'! Another thing to watch out for, is if you intend traveling for a period of time, as in moving to another country. Most plans will only pay you for a short period of time if you are living abroad at the time of claim, so it's one to be aware of if this might apply to you. As always, read the details, be informed of all the facts. You need to be medically certified as unable to work, if this is not the case then a company would likely refuse your application. The company covering you are charging you a price which will ensure they make a profit, pay the advisor/agent, and also ensures that other people who have the cover will get paid if they have a valid claim, so it is in everyone's interest to be upfront and honest about what is and what is not covered, and when it would or would not be paid. Conclusion? As always I will leave it to you to form your own conclusions on this. If your income stopping would have a massive impact on your financial, physical or mental well-being then it could be a worthwhile foundation for you. If you feel the State Benefit would not be sufficient, and you have few other crutches to support you should you be out of work for a considerable period of time, then it could be worth considering, big-time! Please use this information in the manner it is intended, inform yourself and supporting you in creating a better financial future for yourself. Thanks so much for reading, sharing and spreading the word. Paddy Delaney (QFA, RPA &amp; Now Qualified Coach too- yay!!)

Podcast #20: What is Income Protection & Should I Bother??

George Kinder

What is the relationship between life and your money? Listen to this conversation we had with George Kinder to hear more about Life Planning.  For years I have been fascinated about how our relationship with money influences what we do, and don't do in life. So much so that I have begun my own journey to become a Registered Life Planner, to compliment my technical financial qualifications and experience. I was delighted to chat with George Kinder, the 'godfather' of Life Planning within Financial Planning circles, and to share how it can help us all. I hope you find it insightful and useful in your own life/financial planning. Paddy. Links: Kinder Institute George Kinder Site Ryokan Poetry

What is the relationship between life and your money? Listen to this conversation we had with George Kinder to hear more about Life Planning.  For years I have been fascinated about how our relationship with money influences what we do, and don't do in life. So much so that I have begun my own journey to become a Registered Life Planner, to compliment my technical financial qualifications and experience. I was delighted to chat with George Kinder, the 'godfather' of Life Planning within Financial Planning circles, and to share how it can help us all. I hope you find it insightful and useful in your own life/financial planning. Paddy. Links: <a href="https://www.kinderinstitute.com/" rel="nofollow" target="_blank">Kinder Institute</a> <a href="https://www.georgekinder.com/" rel="nofollow" target="_blank">George Kinder Site</a> <a href="https://en.wikipedia.org/wiki/Ry%C5%8Dkan" rel="nofollow" target="_blank">Ryokan Poetry</a>

Podcast 167: Life Planning with George Kinder 

If I come across another 'Best Investments For 2019' or 'Best place to invest €100,000' article I will lose the plot. Reason being that, just like the title of this blog, these articles really are just another form of click-bait. As we all will know, even if we didn't, click-bait is merely a hook with which to drag you into a website, and ultimately to sell you whatever they have in their warehouse, maybe the 'worlds most powerful torch', or the amazing 'world's quickest can-opener'......things designed to solve problems that you don't really have! Likewise, you may not have the problem of needing to know where to invest €500,000 right now, yet you still find yourself reading this! I am not sure what that says about you, or indeed about me who is writing the blessed thing! Yet there is a proliferation of 'best way to invest such &amp; such' and 'best investments in such &amp; such' on the web here in Ireland. The web is great, I really do love it, but my god it's also so full of dross. I have read 5 such articles this morning in the hope of finding something which represents some sort of sense......but alas I have drawn a blank! One article suggests investing it all in a certain investment product, which on closer inspection has a really rubbish performance record and carries 2.7% fees per year, and another suggests investing the entirety in gold in the interests of 'accessing the world's greatest commodity'! If we really were reliant on the information at hand then mistakes could be our hobby of choice for years to come! I understand that media need to create content, it is what generates traffic and subsequently advertising revenue, but as we all will accept, let's not take what we read or hear on the internet as gospel (including what you read or hear right now). Having said that some sources might be more well-intentioned than others! Read Full Blog Here. Paddy Delaney

If I come across another 'Best Investments For 2019' or 'Best place to invest €100,000' article I will lose the plot. Reason being that, just like the title of this blog, these articles really are just another form of click-bait. As we all will know, even if we didn't, click-bait is merely a hook with which to drag you into a website, and ultimately to sell you whatever they have in their warehouse, maybe the 'worlds most powerful torch', or the amazing 'world's quickest can-opener'......things designed to solve problems that you don't really have! Likewise, you may not have the problem of needing to know where to invest €500,000 right now, yet you still find yourself reading this! I am not sure what that says about you, or indeed about me who is writing the blessed thing! Yet there is a proliferation of 'best way to invest such &amp; such' and 'best investments in such &amp; such' on the web here in Ireland. The web is great, I really do love it, but my god it's also so full of dross. I have read 5 such articles this morning in the hope of finding something which represents some sort of sense......but alas I have drawn a blank! One article suggests investing it all in a certain investment product, which on closer inspection has a really rubbish performance record and carries 2.7% fees per year, and another suggests investing the entirety in gold in the interests of 'accessing the world's greatest commodity'! If we really were reliant on the information at hand then mistakes could be our hobby of choice for years to come! I understand that media need to create content, it is what generates traffic and subsequently advertising revenue, but as we all will accept, let's not take what we read or hear on the internet as gospel (including what you read or hear right now). Having said that some sources might be more well-intentioned than others! <a href="https://www.informeddecisions.ie/?p=5389&amp;preview=true" rel="nofollow" target="_blank">Read Full Blog Here.</a> Paddy Delaney

Podcast130: Best Way To Invest €500,000....Kinda!

Hi All, Colm McCarthy (our esteemed Irish Economist) recently said "retirees don't eat equities and bond for their breakfast, they eat rashers and eggs and bread and stuff".......meaning we need cash to survive and feed ourselves in retirement, not funds and technical products. Paddy &amp; John discuss why this matters and how we can begin to consider catering for our retirement. Recorded in a busy pub, there is a nice background ambience to compliment the lad's dulcet tones! Thanks for tuning in! Paddy.

Hi All, Colm McCarthy (our esteemed Irish Economist) recently said "retirees don't eat equities and bond for their breakfast, they eat rashers and eggs and bread and stuff".......meaning we need cash to survive and feed ourselves in retirement, not funds and technical products. Paddy &amp; John discuss why this matters and how we can begin to consider catering for our retirement. Recorded in a busy pub, there is a nice background ambience to compliment the lad's dulcet tones! Thanks for tuning in! Paddy.

Podcast #5: An Intro to Pensions

Emerging Markets might sound a little technical, but please do bare with me, even I can understand it, so you'll be totally fine! It might even be worth your while reading on, if you ever intend investing in Emerging Market Index Funds in Ireland! We explore the past investment returns, what the 'experts' are suggesting they might deliver in the future, and what to watch out for when picking the index funds you desire. Paddy Delaney QFA RPA APA

Emerging Markets might sound a little technical, but please do bare with me, even I can understand it, so you'll be totally fine! It might even be worth your while reading on, if you ever intend investing in Emerging Market Index Funds in Ireland! We explore the past investment returns, what the 'experts' are suggesting they might deliver in the future, and what to watch out for when picking the index funds you desire. Paddy Delaney QFA RPA APA

Podcast 160: Emerging Market Index Funds Ireland

Hi, Thanks for tuning in again! In previous episodes we have discussed the basics of emergency funding, clearing debts and having awareness of where our money goes. Assuming that you have those things in order (or on the way to being in order!) here is a useful podcast episode sharing the key things to consider before you invest for the medium or long term. While we will delve into 'asset allocation' in more detail, this episode is an introduction to the 4 key things to consider when doing an Irish Investment. If listening via iTunes etc. please visit the website www.informeddecisions.ie for all other blogs and podcast episodes Thanks for tuning in. Paddy Delaney.

Hi, Thanks for tuning in again! In previous episodes we have discussed the basics of emergency funding, clearing debts and having awareness of where our money goes. Assuming that you have those things in order (or on the way to being in order!) here is a useful podcast episode sharing the key things to consider before you invest for the medium or long term. While we will delve into 'asset allocation' in more detail, this episode is an introduction to the 4 key things to consider when doing an Irish Investment. If listening via iTunes etc. please visit the website <a href="http://www.informeddecisions.ie" rel="nofollow" target="_blank">www.informeddecisions.ie</a> for all other blogs and podcast episodes Thanks for tuning in. Paddy Delaney.

Episode#10 - Successful Investing - Key Considerations

Happy New Year! It's Officially 2017, and I genuinely wish you every success in whatever you are aiming for in the coming year. How can I take my Pension? The first part of the answer to this question was launched last week (click here), and this week we tackle the second part to this, getting our money from pensions we have 'through work', most often known as company schemes or occupational pension schemes. So, how do I get my money from my company pension you might ask, we here we go, and yes we are going to 'cakify' it again! Trustees: When you are drawing from a Personal Pension as we saw in Blog# 15 you are tied to the Revenue 'rules' when accessing it at retirement. However in the case of Company Schemes you are most often tied to the 'rules' as set out by the Individuals who generally oversee and manage that particular pension scheme. These Individuals are known as 'Trustees' and more often than not they are experienced in this space, have to compete 'Trustee Training', and are bound to act in accordance with the pension scheme 'mandate' which sets out how it should be managed. So the 'trustees' are acting in the interests of the people who have 'cake in the oven'!   What is a Defined Benefit Pension Scheme &amp; How Do They Work? If you work with a company that is promising to pay you x % of your 'final salary' when you finish, and the x is based on the number of years you have worked with the company at that point then you may well have a Defined Benefit Pension, yeeehaaaa! They are generally a great thing to have as the size of the cake at the end is largely dependent on how long you serve in the scheme instead of how much ingredient you yourself add to it! If you have a DB here is how you can most often access your cake.  You can take a slice of cake immediately upon retirement up to a max equivalent to 1.5 times your final annual gross salary. If you have worked between 20-40 years in that scheme you may qualify for that max slice of cake. You do with this what you wish, happy times! You are then drip-fed cake each month until you/your spouse passes away. As noted above the amount of cake which you are drip-fed will depend on the number of years you have been in that pension scheme as an employee.  Typically these schemes pay you 1/60th of your final year's salary for every year you have served. So if you were 20 years in the scheme you may expect to get 1/3 of your final salary as your gross income for the rest of your days, separate to any State Pension entitlement. Not too shabby I'm sure you'll agree! These are a dying breed, the cake requires a huge amount of ingredients and the burden can often be too much for employers to bear, they then stop cooking this particular cake and direct employees into the next and often less favourable type of pension cake!   What is a Defined Contribution Pension &amp; How Does It Work? You will know you are in a 'DC' cake if you are told that you need to put ingredients in, your employer may or may not put ingredients in, and that the size of the cake at the end will be subject to how well the cake gets on in the oven, there's no promises made from the employer. In short the only thing defined with a DC scheme is the contribution you are making, hence the name! Unlike the DB above you are not told 'do x years here and you will get x every year when you retire'. In many ways a DC scheme is very similar to a Personal Pension as we heard about in  Podcast 16. How Do I Access My Money From a Defined Contribution Company Pension Scheme? Almost everyone in a Defined Contribution Company Pension will have the choice of the following methods to access their funds. Drip-Feed Cake Method:  Take up to max of 1.5 times annual final salary immediately and eat that slice as they wish Give the remaining cake to a Life Insurance Company and they will drip feed you a small slice of cake each year until you/your spouse pass away (as taxable income)  Your Own Cake Tin Method:  Take 25% of the cake at retirement as tax free slice If you have guaranteed €12,700 of cake each year from other source you can do any of the following a) pop the remainder in your own cake tin, and access it as you need it (can be very tax efficient and enable high control over your own cake) b) Give the rest to a Life Company and they will drip-feed you a slice each year c) take it all as a taxable lump sum At retirement if you do not have guaranteed income of €12,700 you must lock away €63k of your cake until you are 75. If there is any left over at this point you can pop this into your own cake tin and eat as you like as per #2  So there you have it, pheewww! There is a lot to how we claim our pension funds. This and the previous blog have been an introduction to it, to informing you as to what the finishing line looks like currently. As always when the time comes for you to put plans in place to give yourself the retirement you want you can refer to these and they should help you on the road to making informed decisions. Thanks for engaging and sharing. Paddy Delaney Join Our Weekly 'Informed Decisioners!'           Recommended Reading: Firestarter Sessions- Danielle LaPorte (Great Read/Listen!)  http://www.audible.co.uk/pd/Health-Personal-Development/The-Fire-Starter-Sessions-Audiobook/B007SY96II Actual Book! (Could not find it online on any of the Irish Books Sites)  https://www.amazon.co.uk/s/ref=nb_sb_ss_c_2_20?url=search-alias%3Dstripbooks&amp;field-keywords=firestarter+sessions&amp;sprefix=firestarter+sessions%2Caps%2C206&amp;crid=2ZIF7TQPS5V7S

Happy New Year! It's Officially 2017, and I genuinely wish you every success in whatever you are aiming for in the coming year. How can I take my Pension? The first part of the answer to this question was launched last week (<a href="http://www.informeddecisions.ie/take-my-pension-pot/" rel="nofollow" target="_blank">click here</a>), and this week we tackle the second part to this, getting our money from pensions we have 'through work', most often known as company schemes or occupational pension schemes. So, how do I get my money from my company pension you might ask, we here we go, and yes we are going to 'cakify' it again! Trustees: When you are drawing from a Personal Pension as we saw in <a href="http://www.informeddecisions.ie/take-my-pension-pot/" rel="nofollow" target="_blank">Blog# 15</a> you are tied to the Revenue 'rules' when accessing it at retirement. However in the case of Company Schemes you are most often tied to the 'rules' as set out by the Individuals who generally oversee and manage that particular pension scheme. These Individuals are known as 'Trustees' and more often than not they are experienced in this space, have to compete 'Trustee Training', and are bound to act in accordance with the pension scheme 'mandate' which sets out how it should be managed. So the 'trustees' are acting in the interests of the people who have 'cake in the oven'! What is a Defined Benefit Pension Scheme &amp; How Do They Work? If you work with a company that is promising to pay you x % of your 'final salary' when you finish, and the x is based on the number of years you have worked with the company at that point then you may well have a Defined Benefit Pension, yeeehaaaa! They are generally a great thing to have as the size of the cake at the end is largely dependent on how long you serve in the scheme instead of how much ingredient you yourself add to it! If you have a DB here is how you can most often access your cake. <ol> <li>You can take a slice of cake immediately upon retirement up to a max equivalent to 1.5 times your final annual gross salary. If you have worked between 20-40 years in that scheme you may qualify for that max slice of cake. You do with this what you wish, happy times!</li> <li>You are then drip-fed cake each month until you/your spouse passes away. As noted above the amount of cake which you are drip-fed will depend on the number of years you have been in that pension scheme as an employee.</li> </ol> Typically these schemes pay you 1/60th of your final year's salary for every year you have served. So if you were 20 years in the scheme you may expect to get 1/3 of your final salary as your gross income for the rest of your days, separate to any State Pension entitlement. Not too shabby I'm sure you'll agree! These are a dying breed, the cake requires a huge amount of ingredients and the burden can often be too much for employers to bear, they then stop cooking this particular cake and direct employees into the next and often less favourable type of pension cake! What is a Defined Contribution Pension &amp; How Does It Work? You will know you are in a 'DC' cake if you are told that you need to put ingredients in, your employer may or may not put ingredients in, and that the size of the cake at the end will be subject to how well the cake gets on in the oven, there's no promises made from the employer. In short the only thing defined with a DC scheme is the contribution you are making, hence the name! Unlike the DB above you are not told 'do x years here and you will get x every year when you retire'. In many ways a DC scheme is very similar to a Personal Pension as we heard about in <a href="http://www.informeddecisions.ie/episode-16-how-do-i-access-my-pension/" rel="nofollow" target="_blank"> Podcast 16</a>. How Do I Access My Money From a Defined Contribution Company Pension Scheme? Almost everyone in a Defined Contribution Company Pension will have the choice of the following methods to access their funds. Drip-Feed Cake Method: <ol> <li>Take up to max of 1.5 times annual final salary immediately and eat that slice as they wish</li> <li>Give the remaining cake to a Life Insurance Company and they will drip feed you a small slice of cake each year until you/your spouse pass away (as taxable income)</li> </ol> Your Own Cake Tin Method: <ol> <li>Take 25% of the cake at retirement as tax free slice</li> <li>If you have guaranteed €12,700 of cake each year from other source you can do any of the following a) pop the remainder in your own cake tin, and access it as you need it (can be very tax efficient and enable high control over your own cake) b) Give the rest to a Life Company and they will drip-feed you a slice each year c) take it all as a taxable lump sum</li> <li>At retirement if you do not have guaranteed income of €12,700 you must lock away €63k of your cake until you are 75. If there is any left over at this point you can pop this into your own cake tin and eat as you like as per #2</li> </ol> So there you have it, pheewww! There is a lot to how we claim our pension funds. This and the previous blog have been an introduction to it, to informing you as to what the finishing line looks like currently. As always when the time comes for you to put plans in place to give yourself the retirement you want you can refer to these and they should help you on the road to making informed decisions. Thanks for engaging and sharing. Paddy Delaney <a href="http://www.informeddecisions.ie/spreadtheword/" rel="nofollow" target="_blank">Join Our Weekly 'Informed Decisioners!'</a> Recommended Reading: Firestarter Sessions- Danielle LaPorte (Great Read/Listen!) <a href="http://www.audible.co.uk/pd/Health-Personal-Development/The-Fire-Starter-Sessions-Audiobook/B007SY96II" rel="nofollow" target="_blank">http://www.audible.co.uk/pd/Health-Personal-Development/The-Fire-Starter-Sessions-Audiobook/B007SY96II</a> Actual Book! (Could not find it online on any of the Irish Books Sites) <a href="https://www.amazon.co.uk/s/ref=nb_sb_ss_c_2_20?url=search-alias%3Dstripbooks&amp;field-keywords=firestarter+sessions&amp;sprefix=firestarter+sessions%2Caps%2C206&amp;crid=2ZIF7TQPS5V7S" rel="nofollow" target="_blank">https://www.amazon.co.uk/s/ref=nb_sb_ss_c_2_20?url=search-alias%3Dstripbooks&amp;field-keywords=firestarter+sessions&amp;sprefix=firestarter+sessions%2Caps%2C206&amp;crid=2ZIF7TQPS5V7S</a>

Podcast #17: How Can I Access My Pension Money, Part 2....Cakified!

Ever wonder about Financial Advice in Ireland? Are financial advisors worth their salt? Are financial advisors worth paying? Should I bother getting financial advice? My take is that it totally depends on what you are hoping to achieve, and what support you are hoping to get. The thing that strikes me about both of the examples above is that both Client A and Client B are probably already PAYING for financial advice, irrepsective of whether they are actually benefiting from it or not! In pretty-much every retail financial product relating to financial planning (investments, protection, pension, savings) there is probably a commission going to the advisor or agency that you bought it through, even if you have not seen sight nor sound of them since! Unfortunately this it totally true, and what I believe is as equally as unfortunate is that you could potentially be benefiting from the equivalent of an extra 3% in investment returns per year! Paddy 

Ever wonder about Financial Advice in Ireland? Are financial advisors worth their salt? Are financial advisors worth paying? Should I bother getting financial advice? My take is that it totally depends on what you are hoping to achieve, and what support you are hoping to get. The thing that strikes me about both of the examples above is that both Client A and Client B are probably already PAYING for financial advice, irrepsective of whether they are actually benefiting from it or not! In pretty-much every retail financial product relating to financial planning (investments, protection, pension, savings) there is probably a commission going to the advisor or agency that you bought it through, even if you have not seen sight nor sound of them since! Unfortunately this it totally true, and what I believe is as equally as unfortunate is that you could potentially be benefiting from the equivalent of an extra 3% in investment returns per year! Paddy

Podcast154: Advisor Alpha in Ireland

This week we are going to explore two concepts, 'Diversification' and 'Asset Allocation' which can have significant impact on investment success over the long term, and which are shrouded in mystery and often misunderstood. We are going to tell it like it is, share some insights which may surprise you, and give you some food for thought if this applies to you. What Is Asset Allocation? This is the term most commonly used to refer to the proportional distribution of an investment portfolio between different assets. The asset allocation of a portfolio will determine how much of that investment will be allocated to two or more different asset classes; the most common being Equities, Bonds, Property, Commodities and Cash. The rationale for allocating across asset classes is founded in the alleged correlation in returns between various assets at different points in the cycles of each. The principle here is that if the portion of your portfolio in 'asset A' is in a temporary decline that your portion in 'asset B' will be on the ascent. I say alleged because there is a lot of conflicting evidence as to whether there is a negative correlation or not. Ultimately this concept aims to deliver consistently positive returns while reducing volatility of the overall portfolio. Read Full Blog Here..... Paddy.

This week we are going to explore two concepts, 'Diversification' and 'Asset Allocation' which can have significant impact on investment success over the long term, and which are shrouded in mystery and often misunderstood. We are going to tell it like it is, share some insights which may surprise you, and give you some food for thought if this applies to you. What Is Asset Allocation? This is the term most commonly used to refer to the proportional distribution of an investment portfolio between different assets. The asset allocation of a portfolio will determine how much of that investment will be allocated to two or more different asset classes; the most common being Equities, Bonds, Property, Commodities and Cash. The rationale for allocating across asset classes is founded in the alleged correlation in returns between various assets at different points in the cycles of each. The principle here is that if the portion of your portfolio in 'asset A' is in a temporary decline that your portion in 'asset B' will be on the ascent. I say alleged because there is a lot of conflicting evidence as to whether there is a negative correlation or not. Ultimately this concept aims to deliver consistently positive returns while reducing volatility of the overall portfolio. <a href="https://www.informeddecisions.ie/?p=6206&amp;preview=true" rel="nofollow" target="_blank">Read Full Blog Here.....</a> Paddy.

Podcast131: Diversify Vs Asset Allocation...The Numbers

Hey, We are almost at the very end of 2016, much like all the years before it there was lots happening for everyone. If you had plans for the year you probably have reviewed them and identified what you want out of 2017. Or perhaps you didn't have plans, which probably accounts for many of us. Stephen Covey coined the phrase 'begin with the end in mind', meaning we should focus on the end goal of whatever it is were are doing, this will keep us on track, accountable, moving forward, and progressing in the right direction. I'm always conscious of this when we in the this industry tell people they should be preparing an income for themselves in retirement. Irrespective of whether that is through pension, estate planning, alternative assets or indeed sheep (check out blog #13) unless we know what we are aiming for, what the end goal is, it's really difficult for us to engage in anything. That's what this blog is going to address, how do I get my money from my pension in Ireland, when I finally reach that point? Podcast Episode 16 (here) focused on the ages at which we can retire in Ireland, this is going to focus on the 'how'! Pensions are technical, there is no avoiding that fact. Another fact, we almost all love cake! So I've set myself the challenge of helping you understand all this through cake terminology, just to keep you all sweet.....!   Imagine that as we work we are contributing 'ingredients' (money) to our giant 'cake' (pension fund). The more ingredients we put into this cake, the bigger it will get. Provided we keep the 'temperature' &amp; 'cooking time' (risk &amp; volatility) to a manageable level for the size of cake then we should end up with the cake that we had planned for, just as the 'recipe' (your financial plan) had outlined! Simple yes!? Key Point #1: "When I get access to my cake (retire) can't I just take the cake out of the oven and devour it?" Not that simple I'm afraid. There are rules as to how you can eat your cake, just as there were rules as you were adding ingredients and cooking it over all those years. Irrespective of which type of pension (cake) you have there are 4 methods of accessing it, your circumstances at the time of retirement and the type of cake you have will determine which options are open to you. They are:  Take a decent slice tax free immediately, and eat it! Hand the cake to an insurance company and they will send you a small portion of the cake each year until you die (can be taxable) Put the cake into the press and take a slice as and when you need it (can be taxable) Put the cake into a sealed container until you get to 75, only having access to a tiny slice each year until reaching that age.  There are 2 main types of pensions which the majority are members of, either personal pensions (Personal Pensions and PRSAs), and secondly members of company pension schemes (Occupational Pension Schemes). In this post I will focus on the following; How do I take my money from a Personal Pension or PRSA (Personal Retirement Savings Account)? #1: Congratulate yourself on reaching retirement #2: Take 25% of the cake as a 'tax free slice', and do with it as you please #3: Provided you have enough cake from another source (min €12,700 per annum guaranteed income) you are allowed to put the rest of your cake into the press and take a slice of it as you wish, you control it and the full cake remains in your name. (This is called an ARF). There is a minimum % of cake which you must take each year either 4 or 5 per year, but you can take more if you wish. You pay Income Tax, USC and PRSI (if applicable) on the cake that you take at this point. #4: If you do not have the minimum guaranteed income from other sources you can still do #2 above, but #3 changes for you. Instead of putting it into the press and taking it as you need, the revenue insist that you place just over €63k of it into a sealed container (AMRF) until you are 75. This is a requirement apparently in order to stop you leaving yourself with nothing in later life! After doing that, if you still have cake left over, you can put that amount then into your own press and take it as you want it, as above.   Pardon the pun but this may all seem very spongy, so lets stop trifling around and bring this to the plate! For example, you accumulate a PRSA with €200k value at age 68, happy days, a nice lump of cake you might say! Using #2 you take €50k tax free and do with as you wish. #3, assuming you have the minimum income sorted via State Pension (€12k approx) and another small guaranteed annual income, you can then put the rest of your cake into the press (ARF), manage it and take out (for example) 4% which would give you €6,000 Gross, per annum. If you lived for a long time then the cake could run out, or if you didn't eat all the cake before you passed away then the cake goes into your estate and passes to your beneficiaries. Lets run the same example, but this time you do not have enough cake to allow you do the 'pop it in the press' option. You take the €50k tax free and live it large. You then have to put just over €60k of the remainder and lock it away until 75. You have just under €90k of your cake (less than 50%) which you can 'pop into the press' and take slices as you need. If you were taking the minimum 4% of this it would provide a shade under €3,500 per annum.   So there you go, that is the 'end in mind'. If you 'have a pension' and believe it to be 'enough', consider how much cake you might like to have when you get to that point of your life. If you feel you need to make your cake a bit bigger or smaller then speak to a professional, find out how exactly you will be able to get your hands on your cake, and then you bake it accordingly. Next week we will look into accessing money from Company Pensions, Occupational Schemes and the likes. More cake analogies are in store, I hope you like cake! Thanks for sharing and spreading the 'informed decisions' word, please keep the shares going! Your're a legend, Paddy.

Hey, We are almost at the very end of 2016, much like all the years before it there was lots happening for everyone. If you had plans for the year you probably have reviewed them and identified what you want out of 2017. Or perhaps you didn't have plans, which probably accounts for many of us. <a href="https://en.wikipedia.org/wiki/Stephen_Covey" rel="nofollow" target="_blank">Stephen Covey</a> coined the phrase 'begin with the end in mind', meaning we should focus on the end goal of whatever it is were are doing, this will keep us on track, accountable, moving forward, and progressing in the right direction. I'm always conscious of this when we in the this industry tell people they should be preparing an income for themselves in retirement. Irrespective of whether that is through pension, estate planning, alternative assets or indeed sheep (check out <a href="http://www.informeddecisions.ie/blog-13-pension-tips-ireland/" rel="nofollow" target="_blank">blog #13</a>) unless we know what we are aiming for, what the end goal is, it's really difficult for us to engage in anything. That's what this blog is going to address, how do I get my money from my pension in Ireland, when I finally reach that point? Podcast Episode 16 (<a href="http://www.informeddecisions.ie/when-can-i-retire/" rel="nofollow" target="_blank">here</a>) focused on the ages at which we can retire in Ireland, this is going to focus on the 'how'! Pensions are technical, there is no avoiding that fact. Another fact, we almost all love cake! So I've set myself the challenge of helping you understand all this through cake terminology, just to keep you all sweet.....! Imagine that as we work we are contributing 'ingredients' (money) to our giant 'cake' (pension fund). The more ingredients we put into this cake, the bigger it will get. Provided we keep the 'temperature' &amp; 'cooking time' (risk &amp; volatility) to a manageable level for the size of cake then we should end up with the cake that we had planned for, just as the 'recipe' (your financial plan) had outlined! Simple yes!? Key Point #1: "When I get access to my cake (retire) can't I just take the cake out of the oven and devour it?" Not that simple I'm afraid. There are rules as to how you can eat your cake, just as there were rules as you were adding ingredients and cooking it over all those years. Irrespective of which type of pension (cake) you have there are 4 methods of accessing it, your circumstances at the time of retirement and the type of cake you have will determine which options are open to you. They are: <ol> <li>Take a decent slice tax free immediately, and eat it!</li> <li>Hand the cake to an insurance company and they will send you a small portion of the cake each year until you die (can be taxable)</li> <li>Put the cake into the press and take a slice as and when you need it (can be taxable)</li> <li>Put the cake into a sealed container until you get to 75, only having access to a tiny slice each year until reaching that age.</li> </ol> There are 2 main types of pensions which the majority are members of, either personal pensions (Personal Pensions and PRSAs), and secondly members of company pension schemes (Occupational Pension Schemes). In this post I will focus on the following; How do I take my money from a Personal Pension or PRSA (Personal Retirement Savings Account)? #1: Congratulate yourself on reaching retirement #2: Take 25% of the cake as a 'tax free slice', and do with it as you please #3: Provided you have enough cake from another source (min €12,700 per annum guaranteed income) you are allowed to put the rest of your cake into the press and take a slice of it as you wish, you control it and the full cake remains in your name. (This is called an ARF). There is a minimum % of cake which you must take each year either 4 or 5 per year, but you can take more if you wish. You pay Income Tax, USC and PRSI (if applicable) on the cake that you take at this point. #4: If you do not have the minimum guaranteed income from other sources you can still do #2 above, but #3 changes for you. Instead of putting it into the press and taking it as you need, the revenue insist that you place just over €63k of it into a sealed container (AMRF) until you are 75. This is a requirement apparently in order to stop you leaving yourself with nothing in later life! After doing that, if you still have cake left over, you can put that amount then into your own press and take it as you want it, as above. Pardon the pun but this may all seem very spongy, so lets stop trifling around and bring this to the plate! For example, you accumulate a PRSA with €200k value at age 68, happy days, a nice lump of cake you might say! Using #2 you take €50k tax free and do with as you wish. #3, assuming you have the minimum income sorted via State Pension (€12k approx) and another small guaranteed annual income, you can then put the rest of your cake into the press (ARF), manage it and take out (for example) 4% which would give you €6,000 Gross, per annum. If you lived for a long time then the cake could run out, or if you didn't eat all the cake before you passed away then the cake goes into your estate and passes to your beneficiaries. Lets run the same example, but this time you do not have enough cake to allow you do the 'pop it in the press' option. You take the €50k tax free and live it large. You then have to put just over €60k of the remainder and lock it away until 75. You have just under €90k of your cake (less than 50%) which you can 'pop into the press' and take slices as you need. If you were taking the minimum 4% of this it would provide a shade under €3,500 per annum. So there you go, that is the 'end in mind'. If you 'have a pension' and believe it to be 'enough', consider how much cake you might like to have when you get to that point of your life. If you feel you need to make your cake a bit bigger or smaller then speak to a professional, find out how exactly you will be able to get your hands on your cake, and then you bake it accordingly. Next week we will look into accessing money from Company Pensions, Occupational Schemes and the likes. More cake analogies are in store, I hope you like cake! Thanks for sharing and spreading the 'informed decisions' word, please keep the shares going! Your're a legend, Paddy.

Podcast #16: How Can I Access My Pension Money?.......Cakified!

Welcome back! 'Relief' is an interesting word. If we were to tell someone that we are going to 'relieve myself' it can strike up all sorts of suggestions! Apparently it comes from the Latin 'relevare' which meant 'to alleviate'. In this instance Retirement Relief is all about 'relevare', and to 'relevare' oneself from a burdensome Capital Gains Tax bill! Retirement Relief is a nugget that is quite often missed as a really lucrative opportunity to reduce one's tax bill, particularly if one is a director, or owns a business or company. Can I claim retirement relief? I am on a mission to help answer that very question. Treat this article as an introduction to Retirement Relief, to wit, like everything you read on the internet, if you are going to pursue this type of route then please do (obviously) seek individual guidance on it! I have often wondered why not many people know about it or at least why most of us don't hear much about it.....If we were being cynical we would suggest that the reason is because nobody really makes or saves much money from doing it other than the individual client.....but that would only be the response if one was being cynical! But really, I can't think of any other reason! So in this episode I am aiming to share insights on what it is, how it works and ultimately to answer that question; 'Can I claim retirement relief?' Paddy Delaney QFA RPA APA

Welcome back! 'Relief' is an interesting word. If we were to tell someone that we are going to 'relieve myself' it can strike up all sorts of suggestions! Apparently it comes from the Latin 'relevare' which meant 'to alleviate'. In this instance Retirement Relief is all about 'relevare', and to 'relevare' oneself from a burdensome Capital Gains Tax bill! Retirement Relief is a nugget that is quite often missed as a really lucrative opportunity to reduce one's tax bill, particularly if one is a director, or owns a business or company. Can I claim retirement relief? I am on a mission to help answer that very question. Treat this article as an introduction to Retirement Relief, to wit, like everything you read on the internet, if you are going to pursue this type of route then please do (obviously) seek individual guidance on it! I have often wondered why not many people know about it or at least why most of us don't hear much about it.....If we were being cynical we would suggest that the reason is because nobody really makes or saves much money from doing it other than the individual client.....but that would only be the response if one was being cynical! But really, I can't think of any other reason! So in this episode I am aiming to share insights on what it is, how it works and ultimately to answer that question; 'Can I claim retirement relief?' Paddy Delaney QFA RPA APA

Podcast128: Retirement Relief in Ireland (The Outhouse Version)

Hi All, Thanks for visiting the Informed Decisions Blog. The last few Blogs have been focused on informing you on how you can access money from your Pensions, both Personal Pensions and Employer Company Pension Schemes, when that time comes. If you are a new visitor you can check these out here and  here! For many of us I am conscious that the single biggest financial mountain to climb is one's mortgage. This can often lead, and I'm sure has done for some of you, to the question; "Should I invest and save for the future, or focus on getting rid of my mortgage." You can access the full show notes below, or jump in here:       I had the very same question put to me by a friend recently, he had a large lump sum of money which he had been managing for several years, rolling it over in various accounts, the interest rates constantly falling. He was considering throwing it at the mortgage, bring down the term left. What should he do...................................................What would you do? Listeners to the Informed Decisions Podcast will recall Episode 8 (listen here) where we saw the massive impact a relatively small change in mortgage repayment can have on the term of one's mortgage. This Episode was hugely popular and the Pro's below outline why. For completeness sake lets look at some Pro's and Con's of 'Clearing my Mortgage' instead of 'Investing my Money For the Future' Clearing My Mortgage – The Pros…(not exhaustive)  Guaranteed Return on Investment: If you invest your money in clearing your mortgage you are guaranteeing your return on that investment, there is no danger that the mortgage could come back in future if markets got rocky! You achieve the immediate return of eliminated interest expense. Save on Interest Costs: As above it can save you tens of thousands in interest, which you would have been paying had you not cleared the mortgage. Peace of Mind: This is probably the single most obvious and rewarding one, the fact we now own our home can be a great source of peace of mind for the future, irrespective of what might happen your income. Reduced Cost: By removing the mortgage payment from your monthly outgoings you are reducing your costs, and for some it's big-time! No Need for Mortgage Protection Insurance: If you have no mortgage loan the lender does not need you to have Life Cover on that loan in order to repay it if you die, another cost reduction. Satisfaction: Many of us will remember forever the people we meet who tell us they have 'no mortgage'. It's akin to meeting a celebrity, it is that highly revered! Not necessarily justifiably so, yet it is a primal instinct in us to own the roof over our heads. Achieving that can result in a great sense of satisfaction.  Clearing My Mortgage – The Cons…(exhausting!) So there are lots of really great 'Pros', but before we write the cheque lets look at the full picture, this side is somewhat technical, so brace yourself!  Low Return on Investment: If you invest your money into clearing your mortgage you could be signing up for comparatively low returns on that money. Why? A mortgage is likely the cheapest money you will ever borrow. The rate on majority of mortgages in existence today is in the 3-4% region. You are essentially signing up to that rate with the investment you are making to the loan. Consider for 1 second that in the 1980's when our parents were in the same position the rates were upwards of 20%! There would be no debate in those circumstances! Savings Are in Lower Future Value: All the monetary Pro's were in future savings, meaning they need to be adjusted for inflation. This has a large impact. For example, let’s assume you pay off your mortgage in 25 years instead of 30. Using this Investopedia present value calculator, you’ll see that €1,000 in 25 years time is only worth €423 in today’s terms at a 4% inflation rate. In other words, you have to discount all savings by inflation because the payments you avoid will be in this lower future value. Takes the sheen off slightly? All Eggs in One Basket: Investing all your funds into clearing your mortgage (property) flies in the face of logical and informed Investing. Make Money by Owing:  If you have a Tracker Mortgage or indeed a very good deal on a fixed rate it could in time be lower than the prevailing inflation rate. Inflation rate is currently hovering around the 0% but if it were to rise you could literally be earning by borrowing, in real terms (after inflation), even though you’re paying interest every month. If your mortgage rate was 1.5% and inflation was 1.6% you essentially make more by owing than by owning. If you clear your mortgage you give away that potential financial advantage.    As you have deduced by now, the 'Pros' to clearing your mortgage are fairly obvious and appetising to most of us, however the 'Cons' are somewhat more murky and financially complex, reliant on long term inflation effects and discounted present and future values! Debate: If you sought advice on the matter many Financial Advisers may will quickly highlight to you the long-term historical returns for a given investment product of 6-8% per annum. When this is compared to mortgage rates of 3-4% it seems there is no debate. Common sense would also suggest the following: Investment returns via such a vehicle are highly variable, they can have periods of double digit growth which far outstrip mortgage rates, and indeed periods of double digit downside (losses) where even paltry mortgage interest rates represent a far superior return on your investment. As we all know the future is not the past and returns will vary, but mortgage interest saved is a bird in the hand. It is important to acknowledge however that suitably chosen investment funds have more often than not outperformed mortgage interest rates over the term of an average mortgage (20-30 years). While the mathematics may well point to the fact that investing for the future should provide the investor a greater return in the long term than clearing the mortgage it really is a personal decision. This decision will usually be driven by one's motivations and by how they want to feel, and that to me is proper, provided it is an informed decision.   Thanks for tuning in, please do share, tell your friends, and support Informed Decisions in becoming the leading personal finance podcast in Ireland. Paddy Delaney. QFA, RPA

Hi All, Thanks for visiting the Informed Decisions Blog. The last few Blogs have been focused on informing you on how you can access money from your Pensions, both Personal Pensions and Employer Company Pension Schemes, when that time comes. If you are a new visitor you can check these out <a href="http://www.informeddecisions.ie/take-my-pension-pot/" rel="nofollow" target="_blank">here</a> and <a href="http://www.informeddecisions.ie/blog-16-how-can-i-take-my-pension-cakified-part-2/" rel="nofollow" target="_blank"> here</a>! For many of us I am conscious that the single biggest financial mountain to climb is one's mortgage. This can often lead, and I'm sure has done for some of you, to the question; "Should I invest and save for the future, or focus on getting rid of my mortgage." You can access the full show notes below, or jump in here: I had the very same question put to me by a friend recently, he had a large lump sum of money which he had been managing for several years, rolling it over in various accounts, the interest rates constantly falling. He was considering throwing it at the mortgage, bring down the term left. What should he do...................................................What would you do? Listeners to the Informed Decisions Podcast will recall Episode 8 (<a href="http://www.informeddecisions.ie/podcast-episode-8-pay-off-debt/" rel="nofollow" target="_blank">listen here</a>) where we saw the massive impact a relatively small change in mortgage repayment can have on the term of one's mortgage. This Episode was hugely popular and the Pro's below outline why. For completeness sake lets look at some Pro's and Con's of 'Clearing my Mortgage' instead of 'Investing my Money For the Future' Clearing My Mortgage – The Pros…(not exhaustive) <ul> <li>Guaranteed Return on Investment: If you invest your money in clearing your mortgage you are guaranteeing your return on that investment, there is no danger that the mortgage could come back in future if markets got rocky! You achieve the immediate return of eliminated interest expense.</li> <li>Save on Interest Costs: As above it can save you tens of thousands in interest, which you would have been paying had you not cleared the mortgage.</li> <li>Peace of Mind: This is probably the single most obvious and rewarding one, the fact we now own our home can be a great source of peace of mind for the future, irrespective of what might happen your income.</li> <li>Reduced Cost: By removing the mortgage payment from your monthly outgoings you are reducing your costs, and for some it's big-time!</li> <li>No Need for Mortgage Protection Insurance: If you have no mortgage loan the lender does not need you to have Life Cover on that loan in order to repay it if you die, another cost reduction.</li> <li>Satisfaction: Many of us will remember forever the people we meet who tell us they have 'no mortgage'. It's akin to meeting a celebrity, it is that highly revered! Not necessarily justifiably so, yet it is a primal instinct in us to own the roof over our heads. Achieving that can result in a great sense of satisfaction.</li> </ul> Clearing My Mortgage – The Cons…(exhausting!) So there are lots of really great 'Pros', but before we write the cheque lets look at the full picture, this side is somewhat technical, so brace yourself! <ul> <li>Low Return on Investment: If you invest your money into clearing your mortgage you could be signing up for comparatively low returns on that money. Why? A mortgage is likely the cheapest money you will ever borrow. The rate on majority of mortgages in existence today is in the 3-4% region. You are essentially signing up to that rate with the investment you are making to the loan. Consider for 1 second that in the 1980's when our parents were in the same position the rates were upwards of 20%! There would be no debate in those circumstances!</li> <li>Savings Are in Lower Future Value: All the monetary Pro's were in future savings, meaning they need to be adjusted for inflation. This has a large impact. For example, let’s assume you pay off your mortgage in 25 years instead of 30. Using this Investopedia <a href="http://www.investopedia.com/calculator/pvcal.aspx" rel="nofollow" target="_blank">present value calculator</a><a href="https://financialmentor.com/calculator/present-value-calculator" rel="nofollow" target="_blank">,</a> you’ll see that €1,000 in 25 years time is only worth €423 in today’s terms at a 4% inflation rate. In other words, you have to discount all savings by inflation because the payments you avoid will be in this lower future value. Takes the sheen off slightly?</li> <li>All Eggs in One Basket: Investing all your funds into clearing your mortgage (property) flies in the face of logical and informed Investing.</li> <li>Make Money by Owing:  If you have a Tracker Mortgage or indeed a very good deal on a fixed rate it could in time be lower than the prevailing inflation rate. Inflation rate is currently hovering around the 0% but if it were to rise you could literally be earning by borrowing, in real terms (after inflation), even though you’re paying interest every month. If your mortgage rate was 1.5% and inflation was 1.6% you essentially make more by owing than by owning. If you clear your mortgage you give away that potential financial advantage.</li> </ul> As you have deduced by now, the 'Pros' to clearing your mortgage are fairly obvious and appetising to most of us, however the 'Cons' are somewhat more murky and financially complex, reliant on long term inflation effects and discounted present and future values! Debate: If you sought advice on the matter many Financial Advisers may will quickly highlight to you the long-term historical returns for a given investment product of 6-8% per annum. When this is compared to mortgage rates of 3-4% it seems there is no debate. Common sense would also suggest the following: Investment returns via such a vehicle are highly variable, they can have periods of double digit growth which far outstrip mortgage rates, and indeed periods of double digit downside (losses) where even paltry mortgage interest rates represent a far superior return on your investment. As we all know the future is not the past and returns will vary, but mortgage interest saved is a bird in the hand. It is important to acknowledge however that suitably chosen investment funds have more often than not outperformed mortgage interest rates over the term of an average mortgage (20-30 years). While the mathematics may well point to the fact that investing for the future should provide the investor a greater return in the long term than clearing the mortgage it really is a personal decision. This decision will usually be driven by one's motivations and by how they want to feel, and that to me is proper, provided it is an informed decision. Thanks for tuning in, please do share, tell your friends, and support Informed Decisions in becoming the leading personal finance podcast in Ireland. Paddy Delaney. QFA, RPA

Podcast #18: Clear My Mortgage Early or Invest For My Future

Paddy Delaney

Hi, and welcome to Ireland's #1 Finance Blog &amp; Podcast. This is a first for Informed Decisions, and this week you get to hear it! We recently got to know Rob O'Donoghue of the Rob Of The Green Podcast. Rob interviews all kinds of really interesting guests, and has over 100 episodes at this stage, he is dedicated to it for sure! Rob invited me to be a guest on his podcast, and I was happy to oblige. I share the interview with you dear listener, and hope that you get something of value from the conversation we had. We discuss:  A Bit Of My Own Background How I Started Blogging &amp; Podcasting Financial Planning Insights My Top Investing Tips Personal Development  All of Rob's podcasts are available  here on iTunes and here on  his Website. I hope you enjoy!?  Paddy.

Hi, and welcome to Ireland's #1 Finance Blog &amp; Podcast. This is a first for Informed Decisions, and this week you get to hear it! We recently got to know Rob O'Donoghue of the <a href="http://robofthegreen.ie/home/" rel="nofollow" target="_blank">Rob Of The Green Podcast</a>. Rob interviews all kinds of really interesting guests, and has over 100 episodes at this stage, he is dedicated to it for sure! Rob invited me to be a guest on his podcast, and I was happy to oblige. I share the interview with you dear listener, and hope that you get something of value from the conversation we had. We discuss: <ul> <li>A Bit Of My Own Background</li> <li>How I Started Blogging &amp; Podcasting</li> <li>Financial Planning Insights</li> <li>My Top Investing Tips</li> <li>Personal Development</li> </ul> All of Rob's podcasts are available <a href="https://itunes.apple.com/ie/podcast/paddydelaney-how-to-make-informed-financial-decisions/id1212137500?i=1000434195445&amp;mt=2" rel="nofollow" target="_blank"> here on iTunes</a> and here on <a href="http://robofthegreen.ie/episodes/paddydelaney-informeddecisions-ep102/" rel="nofollow" target="_blank"> his Website</a>. I hope you enjoy!?  Paddy.

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