Investments – Why professional advice is essential
With over €110,000,000,000 sitting in savings, an post, credit unions, and deposit accounts in Ireland, people will likely shift deposits into more growth assets in the next 10 years, especially having seen the ultra-low returns on their savings over several years.
Interest rates have not been as low for a prolonged period for the last 120 years.
So, if you have money on deposit for 5 years or more, you could be losing out in terms of potential gains you could have received.
If you got a 2% net tax return on a €100,000 investment each year for 5 years, imagine the things you could do with that extra money!
Inflation is really the issue, so if you are trying to preserve your purchasing power into the future, you need to get a better return than inflation of 2% a year. Inflation is the rising costs of goods and services. For example, a coffee might cost you €3 in 2020, but in 5 years, it is likely to cost more.
Growth assets are typically shares and Property. Shares going forward from 2020 are expected to generate +4% a year and Property + 3.5% a year on average.
We have a view that helps our clients to maintain their wealth over time and potentially to create intergenerational wealth to pass on to their kids in the future.
With investments, the only guarantee is that you will see a fall in your investment value at some point in time. It will happen, we just cannot say when. Markets typically react to the news, so if there is bad news in the media 24/7 for long enough, people start to panic and sell off their assets at reduced prices. When the panic is significant, people lose a lot because they sell their assets at the wrong time.
In uncertain times, professional investment advice from those that understand the market is essential. Contact us to find out more about our investment advice.