Informed Decisions Independent Financial Planning & Money Podcast

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Turning 60 with a significant pension pot and nothing forcing your hand? This episode is a worked case study on the pension lump sum decision at 60 in Ireland: Take the tax-free lump sum now, or leave the fund invested and revisit it at 65.

Paddy goes through a study-case: Larry is 60, a senior private-sector executive, with €1.4 million in a defined contribution scheme. He doesn't exist. The numbers do.

What you'll learn in this Episode:

How the retirement lump sum is actually taxed in Ireland: the first €200,000 tax-free as a lifetime limit across all schemes, the 20% band to €500,000, and the marginal rate above it
Why an uncrystallised pension carries no mandatory drawdown, and what imputed distribution at 4% from age 61 means once you have crystallised
What five years of 5% to 6% growth is actually worth in net lump sum terms and why the honest answer is a range, not a number
Where the Standard Fund Threshold genuinely bites and where it doesn't, including why a threshold rising €200,000 a year to 2029 changes the usual "don't let it grow too big" advice
The three mistakes that decide most of these cases in practice

If you're approaching retirement with a significant pension pot and you've been assuming 60 or 65 is the moment you have to act, this episode is for you.

🎙️ Full podcast episode and 📖 Blog: www.informeddecisions.ie/post/tfls-at-60-or-wait-ireland

📊 Want to check where you are? Try our free 5-minute Retirement Readiness

Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

DISCLAIMER This content is for general educational purposes only and does not constitute personalised financial advice. Everyone's situation is different — always speak to a qualified, independent advisor before making pension or investment decisions. Tax rules and pension regulations change; figures quoted are accurate at time of recording.

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There is a pitch doing the rounds in Irish advice circles at the moment: private markets have finally been democratised, and private credit and private equity are now open to anyone with a decent pension pot. But is it really like that? In this episode, Paddy looks at what is actually being sold, and at the one feature that matters more than anything else in the brochure, because liquidity here is offered, not guaranteed.

Have a listen, if you'd like to get an idea of what these 'zombie funds' in the private markets sector are all about, what your ARF has to do with them, and what considerations there are regarding private loans and equity investments when it comes to your retirement planning.

What you'll learn:

What an evergreen or semi-liquid fund actually is, and why a redemption window is nothing like selling a share
Why the value on your statement can lag what is really happening in the underlying businesses by months
What a zombie fund is, and why roughly 48% of the institutional investors surveyed by Coller Capital already hold one
Why illiquid assets collide badly with ARF drawdown, where Revenue requires you to draw at least 4% a year from age 61
The four questions to ask before you sign anything and what a vague answer actually tells you

None of this means private markets are wicked, or that nobody should ever own them. It means a bit of healthy scepticism is no bad thing. If you are approaching or already in retirement and someone has put one of these opportunities in front of you, this episode is for you.

🎙️ Full podcast episode and 📖 Blog: www.informeddecisions.ie/post/zombie-funds-private-markets-ireland

📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

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If you've built a pension pot of €1m or more, you've almost certainly thought about how you'll invest it in retirement. What a bunch of people haven't thought through properly is how they'll actually take the money out: that decision, not the fund selection, is often what determines whether your ARF supports you comfortably for thirty years, or gives you a fright in year eight.

After his well deserved holiday, in this episode Paddy talks about retirement withdrawal strategies for an Irish ARF: the bucket strategy versus the total return strategy, and why the choice works differently here than in the US or UK research you'll have read. If you're approaching, or already in, retirement with €1m+ in an ARF, and you're not sure whether you have a withdrawal plan or just a fund value, this one is for you.

What you'll learn:

• How the bucket strategy and the total return (guardrails) strategy actually work inside an ARF

• Why Revenue's imputed distribution welds a hard 4% floor under your withdrawals from age 61 (ARF under €2m)

• What a 20% down year does to a €1.2m ARF under each approach and why a hybrid often captures the best of both

• The three most common drawdown mistakes and how to avoid them

If you're approaching retirement with a significant pension pot and want genuine clarity on turning it into a sustainable, tax-aware income, this episode is for you.

🎙️ Full podcast episode and 📖 Blog: https://www.informeddecisions.ie/post/retirement-withdrawal-strategies-drawdown-risk

Check out our new category on YouTube: Paddy's Pension Pieces. Smaller, condensed content of our topics, where Paddy condenses longer topics into shorter clips, covers topics that are hot off the press or shares timeless classics that are always relevant to pension planning.

📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

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Most people spend decades building wealth and never quite get to the second question: not how do I protect this, but what do I actually want it to do? On this episode, Paddy Delaney talks to Denise Charlton, CEO of Community Foundation Ireland, about strategic philanthropy in Ireland. How it actually works, and where to start.

What you'll learn:

How a Donor Advised Fund works in Ireland, and why the entry point is lower than most assume (€25,000–€50,000)
The difference between ad-hoc giving and strategic philanthropy
How tax relief and Capital Acquisitions Tax exemptions apply to charitable giving in Ireland
How families bring the next generation into a giving conversation, and how endowments work in perpetuity

If you've built significant wealth and you're starting to ask what it's actually for, this conversation is worth your time.

About the Guest

Denise Charlton is Chief Executive of Community Foundation Ireland, the country's leading philanthropic foundation. Her career spans senior leadership at the Immigrant Council of Ireland and Women's Aid; she was a founder of Marriage Equality, and she currently sits on the board of Cuan, the State's statutory agency for sexual and gender-based violence. You can find Community Foundation Ireland at communityfoundation.ie.

🎙️ Full podcast episode and 📖 Blog: www.informeddecisions.ie/post/strategic-philanthropy-ireland

📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

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This one was recorded a while back (in 2024), but the argument hasn't dated a day, if anything, it holds up better now than when we first put it out. A of complexity in Irish pension and investment advice isn't there to help you. It's there to help the person selling it. In this episode, Paddy explains why simplicity almost always beats sophistication when it comes to your pension and investment planning, and what a genuinely simple structure actually looks like.

What you'll learn:

● Why financial firms are often incentivised to make your pension and investments more complicated than they need to be

● The real-world cost of sophisticated, structured investment products that underperform

● What a simple, transparent pension and investment structure actually looks like in practice

● The questions worth asking any advisor before trusting them with your retirement assets

If you've ever had a feeling that your own pension or investment structure is more complicated than it needs to be, this episode is for you.

🎙️ Full podcast episode and 📖 Blog: www.informeddecisions.ie/post/simplicity-over-sophistication-pension-planning

And a quick word on something new: alongside the podcast, I've started putting together shorter pieces for YouTube: Paddy's Pension Pieces. Each one built around a single question from a fuller episode or a specific topic I'd like to discuss in shorter time . The first is up now, on what a €1 million pension pot in Ireland actually leaves you with after tax: check out our YT Channel to discover :) More to follow.

📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

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Two people can retire with the same ARF, the same average return, and the same withdrawal rate and still end up in completely different places. One leaves over €1m to his family. The other runs out of money before he turns 88. The only difference is the order in which the returns arrived. In this episode, Paddy breaks down sequence of returns risk in Ireland. The risk that gets far less attention than fund performance or pot size, but can matter more than either. What you'll learn: • Why sequence of returns doesn't matter at all while you're still accumulating • Why the first ten years of drawdown can account for roughly 77% of your final outcome • How Revenue's 4%/5%/6% imputed distribution rules interact with this risk in an Irish ARF • Four practical ways to protect your ARF: cash buffers, dynamic withdrawal, portfolio construction, and timing flexibility If you're within a decade of retirement, or already drawing an income from your ARF, this is worth half an hour of your time. Enjoy! 🎙️ Find all the full podcast episode and 📖 Blog here: www.informeddecisions.ie/post/sequence-of-returns-risk-ireland 📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: www.informeddecisions.ie/pension-calculator 📅 Find out how we work: www.informeddecisions.ie DISCLAIMER This content is for general educational purposes only and does not constitute personalised financial advice. Everyone's situation is different. Always speak to a qualified, independent advisor before making pension or investment decisions. Tax rules and pension regulations change; figures quoted are accurate at time of recording.

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An Enduring Power of Attorney (EPA) is the planning step most Irish adults never get to. Only around 8% have one, against roughly a third who've made a will. Yet if you lost capacity tomorrow, it's the document that decides whether the people you trust can actually act for you, or whether your family ends up in front of the Circuit Court.

Paddy Delaney is joined by Áine Flynn, Director of Ireland's Decision Support Service, for a clear, practical conversation about planning ahead. If you're approaching retirement with assets to protect, this one matters.

For more information about Áine Flynn and the work of Ireland's Decision Support Service: https://www.decisionsupportservice.ie

In this episode:

Why your next of kin can't automatically step in. And what an EPA changes
The joint-account trap most couples assume protects them
What it costs (€30 to register, €90 to activate) and how the DSS process works
The "holy trinity": Will, EPA and Advance Healthcare Directive, and what each one covers

If you want genuine clarity on protecting yourself and the people you love, whatever happens, this episode is for you.

🎙️ Full episode (video) and 📖 Blog: www.informeddecisions.ie/post/enduring-power-of-attorney-ireland

📊 Want to check where you are? Try our free 5-minute Retirement Readiness Scorecard: https://www.informeddecisions.ie/pension-calculator

📅 Find out how we work: https://www.informeddecisions.ie

DISCLAIMER This content is for general educational purposes only and does not constitute personalised financial or legal advice. Everyone's situation is different — always speak to a qualified, independent advisor (and a solicitor for legal documents) before making pension, investment or estate-planning decisions. Rules and figures change; figures quoted are accurate at time of recording.

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As you get closer to retirement, move your money to safer investments. It sounds reasonable. But what if that one piece of conventional wisdom could cost you €80,000 or more?

In this episode, Paddy unpacks one of the most consequential (and most overlooked) investment decisions you'll make: whether to reduce investment risk before you retire. For a lot of Irish pension holders, this decision has already been made for them automatically, through something called lifestyling often without their knowledge or consent.

Paddy works through the two opposing risks at the heart of the decision: de-risking too early and leaving significant growth on the table in your final accumulation years and sequence-of-returns risk, the single most underappreciated danger in early retirement. Using two scenarios he shows how a default setting can quietly create an €85,000–€100,000 gap, and why the order in which your returns arrive matters more than the average.

You'll come away with a simple three-question framework to bring deliberate, personalised thinking to your own pension, instead of leaving it to a system designed for an average that doesn't exist.

What this Episode covers:

• The two real risks and why most people only know one

• Lifestyling: what your provider may be doing without telling you

• The €85k–€100k cost of de-risking too early

• Sequence-of-returns risk and the retirement 'red zone'

• The bucket strategy as a simple income buffer

• A three-question framework for the ten years before retirement

And if you like to read this episode again, read the full blog post here: www.informeddecisions.ie/post/reduce-investment-risk-before-retirement-ireland

Chapters:

00:00 - The €80,000 question

01:30 - The two real risks

04:00 - Lifestyling explained

07:00 - The real numbers

12:00 - Sequence-of-returns risk

17:00 - The decision framework

21:00 - Mistakes to avoid + ARF considerations

24:30 - Summary & key takeaways

📊 Check out our new Retirement Readiness Scorecard: www.informeddecisions.ie/retirement-readiness-scorecard

📖 Find out how we work at www.informeddecisions.ie

ABOUT THE SHOW

The Informed Decisions podcast is hosted by Paddy Delaney, QFA RPA APA, independent, fee-only retirement planner in Ireland. The podcast and the blog at informeddecisions.ie are educational resources for Irish professionals, business owners, and high-net-worth individuals navigating retirement, tax efficiency, and investment strategy.

DISCLAIMER

This podcast is for general educational purposes only. It does not constitute personalised financial advice. Figures and rules referenced reflect the position as at May 2026 and are subject to change. Always speak to a qualified, independent financial advisor about your specific situation.

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If your pension is approaching or has passed €2 million, the question is no longer just how to grow it, it's how to generate income without handing a significant portion to Revenue unnecessarily. The Standard Fund Threshold in Ireland rose to €2.2 million in January 2026, and the decisions you make in the next few years will determine how much of that headroom you actually use.

In this episode, Paddy covers the income strategies that matter most at the SFT level.

If your pension is approaching €1.5 million or more, this episode is for you.

• Why timing your Benefit Crystallisation Events can shelter up to €500,000 from Chargeable Excess Tax

• How the lump sum offset mechanism reduces your CET exposure — and what the effective SFT really is in 2026

• What the imputed distribution rules mean when your ARF exceeds €2 million

• How to manage income through the standard rate tax band efficiently

• Why spousal pension planning is one of the most underused strategies at this level

📊 Find out how we work and have a look at our Retirement Readiness Scorecard: https://www.informeddecisions.ie

📖 Read the full blog: www.informeddecisions.ie/post/generating-income-standard-fund-threshold-ireland

ABOUT THE SHOW

The Informed Decisions podcast is hosted by Paddy Delaney QFA RPA APA — independent, fee-only retirement planner in Ireland. The podcast and the blog at informeddecisions.ie are educational resources for Irish professionals, business owners, and high-net-worth individuals navigating retirement, tax efficiency, and investment strategy.

DISCLAIMER

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A lot of investors have written off bonds after 2022. In this episode, Paddy Delaney explains why that conclusion is based on a misreading of how bonds work — and what the historical data actually shows.

The 10-year US Treasury yield went from under 6% to over 11% during the 1970s. Bonds still returned 5.4% per year. The worst single year was a loss of less than 1%. If bonds survived that rate environment, what does it mean for the environment we are in today?

In this episode:

How bond returns are calculated (starting yield and duration)
Why rising interest rates improve your future bond returns, not reduce them
What the 1970s data shows, using Damodaran historical records
What this means practically for anyone with bonds in an ARF or occupational pension
A short note on lifestyling: being moved into bonds automatically is very different from choosing to hold them

This episode is relevant if you are approaching retirement, already in retirement, or reviewing an ARF or pension that includes a bond allocation.

If you would like to talk through your own situation, book a Clarity Call at www.informeddecisions.ie

Full blog post:

www.informeddecisions.ie/post/bonds-arf-retirement-ireland

• All Informed Decisions podcast episodes:

www.informeddecisions.ie/podcast/

ABOUT THE SHOW

Find Paddy at www.informeddecisions.ie

TIMESTAMPS

00:00 Introduction to Bonds and Market Perceptions

02:43 Understanding Bonds: Their Role and Functionality

05:20 The Impact of Interest Rates on Bond Investments

08:20 Predictability of Bond Returns and Historical Context

11:11 The Mechanics of Bond Funds and Their Advantages

14:01 Current Bond Market Landscape and Future Outlook

17:03 Strategic Considerations for Investors and Pension Holders

19:46 Common Misconceptions and Mistakes in Bond Investing

22:25 Key Takeaways and Final Thoughts

DISCLAIMER

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"There's a pension somewhere in your name that you haven't looked at in five years."

That's a sentence Paddy finds himself saying in client meetings more often than you'd expect. Across a 25-year career, the typical Irish professional works for three or four different employers — and the result, by the time someone reaches their mid-fifties, is often €100,000 to €500,000 spread across multiple dormant pensions that haven't been reviewed in years.

In this episode, Paddy walks through what he calls the forgotten pension problem: the structural feature of Irish pension administration that means employer-funded pensions don't follow you when you change jobs. He explains the 2-year vesting rule, what it means to be a "deferred member" of a scheme, and the four decisions every senior professional faces when leaving a role with a pension: leave it where it is, transfer to your new employer's scheme, transfer to a Personal Retirement Bond, or transfer to a PRSA.

He also covers two structural changes that took effect at the start of 2026. The first is auto-enrolment "My Future Fund", which launched on 1 January 2026 and now automatically enrols workers earning over €20,000 who aren't already in a workplace pension. The second is a new restriction: transfers from group occupational schemes to personal pension structures (PRSA or PRB) are now only permitted before Normal Retirement Age — a planning point for anyone approaching a late-career exit.

The episode closes with the annual pension audit — three questions Paddy walks through with clients each year to address the forgotten pension problem deliberately rather than letting inertia decide.

TIMESTAMPS

(00:00) Introduction to Forgotten Pensions

(01:53) Understanding the Forgotten Pension Problem

(07:32) Options for Managing Your Pension

(18:26) Recent Changes in Pension Regulations

(27:12) Key Considerations for Senior Professionals

(31:15) Strategies to Address the Forgotten Pension Problem

RESOURCES MENTIONED

• Full blog post (with the four-options framework, 2026 rule changes, and audit checklist):

https://www.informeddecisions.ie/pension-when-you-change-jobs-ireland/

• Companion episode — PRSA vs Company Pension / Master Trust:

https://www.informeddecisions.ie/prsa-vs-company-pension-ireland/

• All Informed Decisions podcast episodes:

https://www.informeddecisions.ie/podcast/

ABOUT THE SHOW

Find Paddy at https://informeddecisions.ie

DISCLAIMER

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After the 22 April IORP II deadline, thousands of Irish directors are now in a pension structure they didn't deliberately choose. Most transitioned from an executive pension to a Master Trust or a PRSA under time pressure. Few sat down to ask whether the resulting structure is actually the one that serves them best.

In this episode, Paddy walks through the PRSA versus Executive Pension / Master Trust decision in detail: Funding mechanics, lump sum comparison, death benefit treatment, and the second decision most people never review: the investment mandate inside the structure.

The episode is anchored to an anonymised client story: a company director in his mid-60s who came to Informed Decisions in early 2023 with a €1.4m pension and one question. Less than three years later, with a different structure and a different investment mandate, that pension is worth over €2m. The estimated cost of taking the "safe" advice he was offered elsewhere: approximately €500,000 of growth.

WHAT'S COVERED

Why the IORP II deadline forced a structural decision under time pressure
How PRSA contribution rules changed in 2023 and 2025
When the Master Trust's salary-and-service formula beats the PRSA's 100 % cap
How the 1.5× salary lump sum compares to the PRSA's 25 % rule
Why the PRSA's uncapped death benefit can change estate planning
How the Standard Fund Threshold (€2.2m → €2.8m by 2029) affects strategy
Why de-risking at 65 doesn't fit modern Irish retirement timelines

Full written breakdown with comparison table, IORP II timeline, and FAQs: www.informeddecisions.ie/post/prsa-vs-company-pension-ireland

If this episode raised questions about your current contribution strategy is going to get you where you want to go, that's exactly what we work through with clients. Find out more at https://www.informeddecisions.ie

ABOUT

Informed Decisions is an independent, fee-only financial advisory firm in Ireland. Paddy Delaney works with a small number of clients each year, typically business owners and senior professionals approaching retirement, to plan and protect retirement decisions in coordinated, tax-efficient ways.

If today's episode raised questions about your own pension: whether the structure is right, whether the investment mandate has been reviewed, or how to think about both together: visit https://www.informeddecisions.ie to see how we work.

DISCLAIMER

This podcast is for general educational purposes only and does not constitute personalised financial advice. Everyone's situation is different. Always speak to a qualified, independent advisor before making pension or investment decisions. Tax rules and pension regulations change; figures quoted are accurate at time of recording.

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Most people approaching retirement believe their job is to reduce risk. Get out of equities. Move into something safe. Ben Carlson disagrees — and he has the research to back it up.

Ben is Director at Ritholtz Wealth Management in the US, author of Risk and Reward (Harriman House, May 2026), and one of the most widely read financial writers working today. He's spent his career studying every major market crash in modern history: the Great Depression, Japan's lost decades, the dot-com bust, 2008 and what they actually mean for long-term investors.

In this episode, Paddy and Ben talk about Ben's new Book:

They cover the yin and yang of Risk and Reward
Why globally diversified investors still came out ahead from financial crises
The three dimensions of risk tolerance (willingness, need, and ability)
How to think about drawdown and bucketing, inflation psychology, and the only benchmark that actually matters for someone approaching retirement.

Ben's new book Risk and Reward is available now in Kindle, paperback, and audiobook (read by Ben himself) from Harriman House.

There's a full written article about this Interview with Ben on the blog at http://www.informeddecisions.ie/post/retirement-risk-and-reward-ireland

If this episode raised questions about where you sit on the age-related table or whether your current contribution strategy is going to get you where you want to go, that's exactly what we work through with clients. Find out more at https://www.informeddecisions.ie

DISCLAIMER: This content is for general educational purposes only and does not constitute personalised financial advice. Always speak to a qualified, independent advisor about your own situation.

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Most Irish high earners are claiming roughly half the pension tax relief available to them. Not because the rules are complicated, but because the contribution percentage set years ago has simply never been revised.

In this episode, Paddy walks through

the age-related contribution limits (15% to 40%)
the €115,000 earnings cap and what it actually means in practice
and a real worked example of a director, age 56, on €180k — who could be claiming €16,100 in tax relief every year but isn't.

He also covers the year-end October timing window (you can still reduce last year's tax bill with one decision), five common mistakes that quietly cost high earners thousands, and why the personal contribution question and the structural question, PRSA versus company pension, really need to be looked at together.

There's a full written article with the age-related table, the worked example, and year-end timing details on the blog at www.informeddecisions.ie/post/pension-tax-relief-ireland-explained

Free Webinar: Should You Sell Your RSUs? - A Practical Guide for Tech Employees in Ireland, 20th May 2026: https://www.informeddecisions.ie/webinar/webinar-should-you-sell-your-rsus

DISCLAIMER: This content is for general educational purposes only and does not constitute personalised financial advice. Always speak to a qualified, independent advisor about your own situation.

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Most ARF holders know their fund value. Most know Revenue requires a minimum annual drawdown. Very few have stopped to ask whether meeting that minimum is actually a strategy, or simply the path of least resistance.

In this episode, Paddy explores safe withdrawal rates in an Irish context: the research on real retiree behaviour, why the 4% rule is both useful and misunderstood, and why the sequence of returns in the first five years of retirement carries disproportionate weight on long-term outcomes.

He walks through a concrete sequence-of-return scenario: same starting fund, same average annual return, same withdrawal rate, completely different outcomes and shares a real-life case study of a retired solicitor whose conservative ARF mandate was quietly eroding her fund at a 7% real rate of depletion annually.

Covered in this episode:

The US Health and Retirement Study findings on actual retiree withdrawals
Bill Bengen's 4% rule and its Irish limitations
Sequence of return risk and how a cash buffer changes the equation
Three common ARF drawdown mistakes and three concrete takeaways.

The imputed distribution sets the floor. It doesn't set the strategy.

Read the full blog post at www.informeddecisions.ie/post/safe-withdrawal-strategy-arf-ireland

DISCLAIMER: This content is for general educational purposes only and does not constitute personalised financial advice. Always speak to a qualified, independent advisor about your own situation.

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You've built a €2 million pension. Now here's the question nobody asked you: how much of it will you actually keep?

In this episode, Paddy runs the real numbers on what a €2 million ARF looks like in Ireland in 2026: mandatory drawdowns, income tax, USC, PRSI, and the phased strategy that could save you tens of thousands every year in the early stages of retirement.

What this Episode covers:

Why a €2M ARF triggers a mandatory €120,000 income. Whether you need it or not
The real net income after tax: €72,614 at a 39.5% effective rate
How phasing your drawdown across two crystallisation events drops your annual tax bill from €47,386 to €8,088
What happens to the deferred pot if it grows at 6% for 8 years, and how that interacts with the Standard Fund Threshold
The couple scenario: why joint assessment changes everything
SFT mechanics at each Benefit Crystallisation Event and where the margin gets tight

The numbers are stark. The structure matters. And getting this wrong (or not thinking about it at all) is one of the most expensive planning gaps we see.

Discover the full blog post and show notes on informeddecisions.ie

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In this week's episode, Paddy tackles the question he gets asked more than any other: how much do I actually need to retire in Ireland?

Well, for an answer to that question, one should make a proper calculation beforehand, and Paddy is here to help you out by covering the key benchmarks from the Pensions Council report, what they mean in practice, and where they fall short.

Some of the specific points covered in this episode:

Why the state pension — currently €299.30 per week in 2026 — changes the calculation significantly, and what it means for couples where both partners qualify
The simple framework for working out your own number: current spending, minus what disappears, plus what increases, minus state pension, divided by 0.04
Why many couples targeting a comfortable retirement need a private pension pot closer to €300,000–€400,000 than the €1 million figure people often assume
The healthcare wildcard — private health insurance costs that the benchmarks don't fully capture
Why the question changes completely for those with €1 million or more in pension assets: it's no longer "do I have enough?" but "how do I structure what I have?"
The imputed distribution rules every ARF holder needs to understand before drawing down

If you're in your 50s or 60s and haven't yet put a real number on what retirement will cost you, this episode is a practical and reassuring place to start. Enjoy listening!

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In this week's podcast, Paddy talks about what a €1 million pension can actually generate in retirement—and why the headline number doesn't always match the reality of income.

The tax-free lump sum explained You can take 25%, but only the first €200,000 is fully tax-free. The rest may be taxed, reducing what you actually receive.
ARF income isn't as high as you think A €750,000 ARF might generate around €30,000 per year—but after tax, that's closer to €25,000 net.
The State Pension makes a big difference Adding the State Pension can bring total income to roughly €45,000+, improving monthly income significantly.
Annuities offer certainty—but at a cost They provide guaranteed income for life, but you give up control, flexibility, and access to your capital.
You can take more—but it comes at a price Higher withdrawals from an ARF are possible, but they increase your tax bill and may reduce long-term sustainability.
A mix of ARF and annuity may work best Combining both can give you a balance of guaranteed income and flexibility.
Couples have a clear advantage With two State Pensions and wider tax bands, married couples can generate significantly higher net income.
What matters isn't the €1 million It's the income it produces—and whether that income supports the life you want.

What's realistic, what's sustainable, and what €1 million actually means in retirement. Enjoy listening!

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In this week's podcast, Paddy talks about why leaving your cash in a current or low-interest account is quietly costing you.

Your savings could earn more Demand deposit accounts now offer around 2% and fixed-term options near 3%, so idle cash loses ground to inflation.
Use the right tools The CCPC comparison tool helps Irish savers easily compare domestic and international deposit accounts.
Rates vary widely Foreign platforms often offer better rates than Irish banks, but terms matter—don't just chase the headline numbers.
Tax makes a difference DIRT takes 33% of your interest, so tax-free options like State Savings and some government bonds can be surprisingly competitive.
Read the fine print Platforms like Raisin show strong rates, but the advertised "3%" often comes with conditions. Actual easy-access rates are closer to 2%.

What's realistic, what's competitive, and how to make your cash work harder for you.

Hope it helps.

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Most people with significant pension assets have no real idea what their financial advisor earns from their money. Not because the information is illegal to share — it isn't — but because the system is designed in a way that makes it genuinely difficult to see.

In this episode, Paddy looks at how commission structures work in Irish financial advice, why the difference between a percentage and a euro figure matters enormously, and what a truly transparent client-advisor relationship should actually look like.

Key points covered:

How initial and trail commissions work on Irish ARFs, pensions and investment products — and what those percentages look like when converted into real euro figures
Why the structure of commission-based advice creates a conflict of interest that isn't malicious, but is very real
The difference between a suitability standard and a fiduciary duty — and why that distinction could be worth a significant amount of money to you
A real client story: a couple who were being advised to keep working and keep contributing, when in fact they already had enough to retire comfortably
What good transparency would actually look like — and the three questions every investor should be asking their advisor right now

I hope it helps.

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In this week's episode, I welcome Aaron to the podcast before diving into a timely topic for Irish savers and investors: how inflation quietly erodes cash savings over time.

I look at why holding too much cash can damage long term purchasing power, why fear often keeps people on the sidelines, and why a diversified, low cost investment approach has historically offered a stronger path for long term wealth.

Key points: • Inflation reduces the real value of cash, even when your account balance stays the same • Too much money on deposit can weaken long term wealth and legacy outcomes • A diversified global portfolio has historically rewarded patient investors despite short term volatility

I hope it helps.

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Michael Houghton returns to the Informed Decisions Podcast seven years after his first appearance to share how his thinking on money, work and property has evolved. Michael is a personal finance writer, former software developer, FIRE advocate, Irish Independent columnist, and now an active property investor building income and wealth through rental property in Ireland. In this conversation, Michael explains why financial independence is really about choice, not simply giving up work. He shares how he and his family went from extreme saving and FIRE to a more flexible life built around purposeful work, property income, and long term planning. Key talking points • Michael's journey from New Zealand visitor to living in Ireland for 15 years • How he and his family pursued FIRE by saving aggressively and working towards financial independence • Why hitting your number does not always mean you want to stop working • How he thinks about retirement, purpose, and the value of meaningful work • Why he sees property as a strong long term wealth building tool • The role of rental yield, leverage, refinancing, and bank appetite in building a portfolio • The risks of property investing, including concentration, leverage, insurance, and tenant issues • How property fits alongside pensions and other investments in an overall financial plan I hope it helps.

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In this week's podcast, Paddy is joined by specialist solicitor Elaine Byrne to demystify trusts and explain why they're one of the most powerful — and underused — tools in Irish estate planning.

From discretionary trusts for young children to protecting a family member with additional needs, Elaine covers the types of trusts, the tax implications, how to update your will, and what it actually costs to get it done right. If you've been putting off your will or wondering whether a trust is relevant to your family — this one's for you.

I hope it helps.

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We can spend decades building our wealth, protecting our families, and planning for retirement. But there's one question most people avoid until it's too late: what happens if you can't make decisions for yourself?

In this week's podcast I look at Enduring Power of Attorney.

I hope it helps

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In this week's podcast, Paddy sits down with guest Brendan Allen to unpack the rental market right now, and it is messy. They get into why so many landlords feel stuck between shifting government rules and real world supply shortages, and how that tension can push rents higher even when the aim is tenant security. Brendan also breaks down the practical business case for staying invested long term, why commercial property can suit some investors better than residential, and what you need to check before you jump in. If you have ever thought, surely it cannot be this complicated, bad news: it can. Good news: you can still make smart calls if you do the work.

Key talking points • Why landlord confusion is rising as regulations change and market rent keeps moving • Supply shortages as the core issue, especially outside big cities, and how that affects rents • Commercial vs residential property: returns, maintenance, and what type of investor each suits

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If you're saving for retirement or nearing the end of your career, or eyeing retirement or a 'handier' role :) a significant change is on the horizon that could meaningfully affect how much tax you'll pay on your pension. From 2026, the Standard Fund Threshold (SFT), the maximum value you can accumulate across all retirement benefits without triggering additional tax charge, will begin to increase for the first time in over a decade.

For many high earners and diligent savers, this represents a genuine opportunity to improve tax efficiency, reduce liabilities, and plan more strategically around when and how to access your retirement benefits. This piece aims to keep it plain English, and I hope you will learn:

‍ • What the Standard Fund Threshold is in 2026 and why it matters • How your pension is valued for SFT • What tax applies if you breach it, and differences between Defined Benefit, and the rest! • Smart planning moves before you retire • When to get help and stop guessing

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If you are thinking about retiring in 2026, or even easing back from full time work, this is the year where small decisions start to matter a lot. In this week's episode, I look at how to check if retirement is actually realistic, which pension moves still make sense, and how to think about income rather than just fund size. This is about clarity, not hype. And avoiding expensive mistakes! Key talking points • Why the year before retirement is the most valuable planning window • The five numbers you must know before saying "I'm nearly there" • Why income planning beats obsessing over pension fund size • Pension contribution and AVC opportunities that disappear if you delay • Cash buffers and why they reduce stress more than people expect • When investment risk becomes your friend and when it becomes a problem • Sequence risk explained in plain English • Common mistakes we see from people one to two years out from retirement • What you should have ready before speaking to a financial planner I hope it helps!

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If you have an Executive Pension/SSAS or are a member of an Occupational Pension Scheme approaching retirement, you might want to know about these big changes coming your way!

Two major pension updates are colliding;

One from European regulation relating to 'Exec Pensions' and 'Small Self Administered' schemes (SSAS) which impacts self employed directors - One from Revenue relating to employees and losing control over their group pension schemes after 'Normal Retirement Age' (NRA)

Both can change where your pension sits, how it is invested, and when you can access it.

And all of it can happen without your say so, if you do nothing.

‍Key points I'll share today;

What the European IORPS2 deadline really means for Executive and SSAS pensions
How automatic moves to Master Trusts work
The big Revenue change limiting pension transfers from Occupational Pension Schemes
Why early retirement plans are most exposed
What practical steps make sense now

I hope it helps.

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Welcome to the very last, and shortest, Informed Decisions Blog of 2025!

We've had a very interesting investment year so far, and I want to share some brief investment observations and comparisons of the year.

Also, I'll share a few acknowledgements of those that helped me and Informed Decisions during the year.

Thanks,

Paddy.

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In this week's podcast -

Your Essential Pre-Retirement Checklist

Retirement starts long before you hand back the laptop or walk out of the office for the last time! The real work happens in the final decade, when you bring everything together; pensions, savings, tax, debts, lifestyle, and the practical bits that make life run smoothly.

This pre-retirement checklist Ireland will hopefully give you a clear, practical path that helps you can step into the next stage with clarity and confidence (not a big ask is it!?).

What we'll explore in this week: • How to calculate your retirement number • How to review pensions and income sources in an Irish context • How to tidy up investments without derailing long-term returns or compounding • The key tax and admin tasks to complete before leaving work • When professional planning adds value

I hope it helps

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In this week's podcast - The Income Investor's Dilemma in Ireland

Many investors in their 50's and 60's want dependable and sustainable incomes from their investment assets, fair enough!

You may be wondering should you invest in Dividend Stocks or Distributing Funds in order to generate income - and it is a fair question.

The choice often falls between 'Dividend Stocks' and 'Distributing Funds' (both pay dividend income) or 'Total Return Stocks' and 'Accumulating Funds' (don't pay dividends, instead accumulate profits in the business or fund).

Key points (I hope!) you'll take away: • Why dividends feel attractive • How Irish tax rules affect dividend income • When bonds can support more stable withdrawals • How total-return investing can offer control and flexibility • Practical ways to build retirement income without chasing dividends purely for the sake of it!

I aim to walk through how dividends really work, how Irish tax treatment impacts, and the key differences between it and a total-return approach for your income plan.

And while we won't be going hugely deep into the weeds here today - it will hopefully help clarify a few things for you.

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This episode looks at practical ways to pull income from pensions without handing more to Revenue than you need to. You hear how rental income fits into the picture, how a non-earning partner's tax band can save you money, and why timing matters when you've no salary coming in. The chat keeps circling back to one point. Your own setup dictates the smartest drawdown plan.

Takeaways

• You can pull income from pensions in a planned, tax-efficient way.

• Your personal position drives every decision. No two households look the same.

• Rental income changes the order in which you tap different pots.

• A partner with no taxable income can unlock unused standard-rate band.

• Taking modest amounts early can help you avoid chunky tax later.

• A quick yearly review keeps you from drifting into higher tax.

• State pensions may give you room to delay pension withdrawals.

• Mixing income sources often gives you steadier and cleaner results.

• Avoiding forced withdrawals in later life protects long-term value.

• You worked for it. You should enjoy it.

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Is now the right time to move a chunk of your investment or pension assets out of equities, and into Bonds, Money Market Funds or Cash?

It's a question that you may be asking because of a headline you read, an online commentator with a scary statistic, or someone you chatted with spoke of impending doom!

I'll not tell you here whether you should or you should not, but I will briefly share actual potential outcomes for you to consider, before you give it another seconds' thought!

I hope it helps!

This podcast is guidance only. Always seek qualified financial advice for your own situation

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Many Irish parents in their fifties are still financially supporting adult children—and it's quietly delaying their retirement goals.

Key takeaways: • Each adult child can cost around €15k–€20k per year in ongoing support—rent, car, health cover, and general expenses. • Those costs directly reduce pension contributions and long-term savings, sometimes delaying retirement by years. • Using tools like the McClements Scale shows how each extra person in the home adds significant cost pressure. • Setting clear timelines, gradually stepping back support, and redirecting funds into pensions can rebuild financial freedom fast.

When kids finally stand on their own two feet, your savings—and sanity—get a big lift!

I hope it helps!

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You've probably wondered: what does financial advice actually cost in Ireland, and is it worth it?

Indeed, many people are also probably wondering if they are actually paying for advice, who may or may not be getting any!?

‍ Many professionals in their 50s ask that question when they start thinking about retiring, reducing hours, or simply getting their finances in order. They may have accumulated assets through their careers, may or may not have had an advisor during that time, but are now considering the need as they plan their next chapter.

At Informed Decisions, we believe clarity beats guesswork. So let's break down what you pay, what you get, and how to know if you're getting real value.

What you'll learn: • Typical fees Irish advisors and providers charge • What clients (should) get for those fees • Whether advice adds measurable value to clients • How to tell if advice is independent and worth paying for • How to find a professional and transparent advisor

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If you're retiring in Ireland with around €1 million in pension savings, one of the biggest questions you'll face is whether to take income from an ARF (Approved Retirement Fund) or to buy an annuity.

In this episode, I break down both options in plain English — what they mean, how they work under Irish tax rules, and which might suit your lifestyle and risk appetite.

Key Points:

What's an ARF?

What's an Annuity?

Typical Income from a €1m Pension

Taxation

Pros and Cons

I hope it helps

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In this week's podcast, I talk about investing your pension at 50.

Turning 50 is a wake-up call for your pension. It's not about panic - it's about planning smart.

Here's what matters most:

Key Points: • At 50, your goals shift — you're closer to retirement, but growth still counts. • Review your pension funds now: what's in equities, bonds, or cash? • Rebalance gradually. • Diversify — global funds, low costs, and no guesswork. • Check old company pensions. Consolidate only if it saves on fees or boosts control. • Understand your tax position — up to 25% tax-free lump sum (max €200k). • Know your retirement routes: ARF for flexibility, annuity for certainty. • Independent financial planning helps avoid big mistakes — and stress!

I hope it helps.

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In this week's podcast, I unpack the growing issue of unregulated investments in Ireland — from headline-grabbing collapses to the hidden risks facing everyday investors. Discover why so many well-intentioned savers were caught out, what to watch for, and how to protect yourself from high-risk "opportunities" that promise too much.

Key points:

The rise and fall of high-profile unregulated firms like Arena Capital, BlackBee, and Custom House Capital
Why ordinary savers — not just speculators — were drawn into risky investments
How commissions and incentives can cloud financial advice
The lack of Central Bank protection and investor compensation for unregulated products
Common fee structures and hidden costs investors often overlook
Practical steps to verify if an investment is regulated
Simple rules to stay safe and avoid losing hard-earned savings

Disclaimer

The content of this site including blogs and podcasts is for information purposes only. Everybody's financial situation is different and the content we share on our site and through podcasts may not be applicable to you.

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In this week’s podcast, we dive into why so many investors underperform the very funds they invest in. Drawing on Morningstar’s Mind the Gap 2025 research, we explore how “magpie behaviour” — chasing shiny new investments, panicking in downturns, or tinkering too much — quietly erodes long-term wealth.

The evidence is clear: bad behaviour can cost over 1% per year, compounding into massive losses over time. But the gap isn’t inevitable. This episode shares practical steps to help you capture more of the returns you deserve — and avoid being the magpie.

Key Points * Morningstar “Mind the Gap 2025” shows investors lose ~1.2% per year due to poor timing and bad behaviour. * Chasing shiny investments (like tech, AI, or thematic funds) often backfires. * ETFs and bond funds show wider performance gaps due to frequent trading. * Behaviour matters more than markets or fees — discipline drives long-term returns. * Five ways to close the gap:

+ Automate contributions, rebalancing, and withdrawals
+ Work with an advisor to stay disciplined
+ Focus on low-cost, globally diversified core holdings
+ Keep “fun money” small if dabbling in niche funds
+ Build a margin of safety into your financial plan

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Would you rather build a financial future lined with velvet cushions, or one pieced together with spud bags?? Too many households in Ireland—and globally—are entering retirement without the savings needed to sustain their lifestyle. In this episode, I explore the uncomfortable truth behind retirement readiness, from the dominance of State Pensions to the worrying lack of planning, and why delayed gratification and early saving matter more than ever. Key Points: * State Pension reliance: In Ireland, over half of workers without private pensions expect to rely mainly on the State Pension (€15,100 p.a. in 2025). * Research insights: CCPC data shows 26% of adults are completely unprepared for retirement; many regret starting pensions too late or don’t understand how they work. * Spending reality: Retirement spending often follows a U-shaped “smile”—high early, lower mid-life, higher again with health costs. But reductions are often enforced, not chosen. * Global parallels: US data mirrors the same challenge—most middle-aged households have modest pension balances, and Social Security dominates retirement income. * Cultural habits: Rising instant-spending patterns today may make cutting back tomorrow feel like deprivation. * Solutions: Start saving early, define retirement goals, regularly review pension performance, seek professional advice, and prepare for Auto Enrolment (2026). * The takeaway: Financial freedom in retirement won’t just happen—it must be planned for deliberately, and the time to act is now.

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In this week's episode, I chat with Dan Haylett, Director of TFP Financial Planning in the UK, author of The Retirement You Didn’t See Coming, and host of the Humans vs Retirement podcast. Dan has built his career around helping people prepare for retirement in a way that goes far beyond the numbers, focusing on the human side of life after work. Together, we explore: * Why retirement is less a maths problem and more a human challenge. * The dangers of the “blank canvas” problem and why day 182 of retirement can be the most difficult. * Dan’s five pillars of a thriving retirement: purpose, identity, relationships, structure, and wellbeing. * The concept of memory planning—turning money into meaningful experiences rather than just numbers on a page. * Why modern retirees are “first-generation retirement rebels” and how to overcome the fear of spending after decades of saving.

I hope you find this episode, full of insights for anyone thinking about how to make the most of their second half of life—financially, emotionally, and personally. Paddy What Will I Do All Day?by Patrice Jenkins — a short, self-published book full of stories and insights from retirees, which Dan describes as a "wonderful punchy read" TFP Financial Planning Dan's LinkedIn Disclaimer The content of this site including blogs and podcasts is for information purposes only. Everybody’s financial situation is different and the content we share on our site and through podcasts may not be applicable to you.

The articles, blogs and podcasts are not investment advice. They do not take account of your individual circumstances, including your knowledge and experience and attitude to risk. Informed Decisions can’t be held responsible for the consequences if you pursue a course of action based on the information we share

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In our last podcast, we celebrated Fran's incredible achievement of amassing a €2 million pension pot through decades of disciplined saving and investing.

Some who read it were inspired, some were envious, and others said "I don't bloody need €2m pension pot"!

Today, we're asking a different question entirely: Do I actually need a €2 million pension pot to retire comfortably? And you'll see why I suggest the following are appropriate pension pots to fund a 'comfortable' retirement lifestyle;

c€500k if you plan to retire in your mid 60's
c€1m if you would like to retire in your mid 50's

‍These may seem like a luxury questions, but are the most important aspects in our retirement planning in Ireland.

Because here's the truth: knowing how much you need to spend in retirement is key to knowing how much you need to save for your pension pot Ireland. Disclaimer: Seek professional advice before taking any course of action.

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Today, we’re diving into the real-life(ish) story of Fran – a regular guy who built a €2 million+ pension pot and retired at 55.

No big lotto win. No magic investment hacks. Just smart use of Ireland’s pension system, discipline, and a few skipped car upgrades!

Fran started young, contributed consistently, and maximised every bit of tax relief and employer matching he could get his hands on. He invested for growth, kept his cool through market crashes, and stuck to the plan. Over 30 years, a €350,000 net contribution turned into a €2 million pension pot.

We walk through: • Exactly how Fran built that pot • How he drew income tax-efficiently from 55 onwards • How he used the ARF to stay flexible and keep control • And how he left a legacy worth millions – without giving half of it to Revenue

If you're working in Ireland and want financial independence on your own terms, Fran’s journey is a blueprint worth paying attention to.

No fluff, no jargon – just a straight-talking guide to building your future wealth and freedom.

Let’s dive in and see what we can learn from Fran’s €2M success story.

I hope it helps.

Disclaimer The content of this site including blogs and podcasts is for information purposes only. Everybody’s financial situation is different and the content we share on our site and through podcasts may not be applicable to you.

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Welcome to Informed Decisions Podcast, where we bring you expert insights for Irish investors and retirees.

Today, we have a rip-roaring guest joining us - Bill Bengen, the financial planner who literally wrote the book on retirement withdrawals. Back in 1994, Bill's groundbreaking research established what became known worldwide as the "4% rule".

This was the cornerstone of retirement planning, that suggests you can safely withdraw 4% of your portfolio annually without running out of money.

But here's where it gets interesting for our Irish listeners: Bill has been revisiting his own work, and his latest research suggests that retirees today might actually be able to take 5% from their Approved Retirement Funds over multiple decades, not the traditional 4% many have been following.

For those managing ARFs here in Ireland, this could be game-changing news. We know how crucial it is to balance enjoying your retirement years while ensuring your money lasts - it's that delicate dance between living well today and having security tomorrow.

Bill's going to walk us through exactly why he believes this adjustment makes sense in today's market conditions, and how to think about implementing this approach with your own ARF strategy.

Whether you're already drawing from your ARF or planning for that transition, this conversation could reshape how you think about your retirement income. Let's dive in with the man who started it all!

I hope it helps.

Paddy Delaney QFA RPA APA

Disclaimer: Seek professional advice before taking any course of action.

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In this episode of the Informed Decisions podcast, I chat with Rob Halligan and Scott Ashmore, co-founders of Shuttle, a platform aiming to democratise access to private equity and venture capital investments. The conversation dives into the fundamentals of private markets, how they differ from public equity investing, and why early-stage companies often turn to private capital over traditional bank loans. Rob and Scott shed light on the risk-reward profile of venture investing, the importance of diversification, and how Shuttle helps everyday investors participate in an asset class typically reserved for institutions and high-net-worth individuals. The discussion also explores the mechanics of venture funding - from pre-seed to Series D rounds - highlighting how company valuations are set and the expected timeframes for returns. With Central Bank of Ireland authorisation, Shuttle operates a quarterly investment model, allowing users to gain exposure to a portfolio of vetted startups. The duo outline their vision for the platform, its future expansion into VC fund access, and how it aligns incentives by charging only a modest annual fee and a performance-based profit share. Key Points: * Private vs Public Markets: Private equity involves investing in unlisted companies, offering potentially higher returns but greater risk and illiquidity. * Venture Capital Basics: VC is a subset of private equity focused on early-stage, high-growth startups, structured around funding rounds (e.g., Seed, Series A-C). * High Risk, High Reward: Venture capital returns follow a power law distribution—few winners generate most of the returns. * Diversification is Key: Investors should aim for 50+ holdings to reduce risk; Shuttle structures this via quarterly “drops” of 2–3 companies. * Accessibility: Shuttle enables retail investors to participate in venture deals from as little as €250 per quarter. * Platform Model: Investors pay €250/year plus a 10% fee only on realised profits, aligning platform and investor interests. * Liquidity & Exit: Returns typically take 5–10 years; Shuttle is exploring secondary markets to improve interim liquidity. * Market Trends: Private companies are staying private longer; institutional data points to retail access as the next frontier. * Educational Focus: Shuttle supports investor understanding through simplified UX, content, and risk-appropriate onboarding.

I hope it helps JoinShuttle.com Grit by Angela Duckworth – recommended by Rob Halligan. A book about the power of passion and perseverance in achieving success. Outliers by Malcolm Gladwell – recommended by Scott Ashmore. It explores what makes high achievers different, focusing on the factors that contribute to success. Disclaimer

Grit: The Power of Passion and Perseverance

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If you’ve ever looked at your pension statement and thought, “What does this actually mean?” You’re not alone. In this episode, #338, we’re cutting through the jargon and making sense of Defined Benefit (DB) pension schemes, especially for Irish employees and retirees.

These schemes can offer incredible long-term value, but many people don’t fully understand how they work, what they’re worth, or what decisions they might face around them. Whether you’re still paying into a DB scheme or left it behind years ago, we’ll walk you through the key numbers, why these pensions are so unique, and how to approach big decisions, like whether to transfer out. It’s all about helping you understand, appreciate, and protect one of your most valuable financial assets.

I hope it helps.

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For the past 8 years, I’ve been making the case that most investors, particularly those who can tolerate volatility, should avoid Lifestyle investment strategies in pensions. It’s been a lonely stance, with little to no mainstream coverage, even though investor feedback on my analysis was consistently positive.

Back in early 2024, I shared updated research on Lifestyle and Default Investment strategies used by pension funds in Ireland. The results were clear: even after more than a decade of strong market performance, investors who took the ‘Do It For Me’ route, defaulting to cautious, de-risking strategies, ended up with significantly poorer outcomes than those who chose a more hands-on, equity-focused approach.

Was I mad? Or missing something? It appears not.

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This week I flashback to a podcast from 2021! While it is a few years old its a common and important question.

Key takeaways

How big your pension should be when you start drawing down income
How big your pension should be at various stages of your life
What you can do if it's not as big as you would like it to be!
How to live 14.9% longer!

I hope it helps!

Disclaimer

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In this week's podcast I chat with Dr. Daniel Crosby. He discusses the evolution of behavioral finance over the past eight years, reflecting on the growing acceptance and understanding of the field. He shares insights from his latest book, 'The Soul of Wealth,' emphasising the importance of health, happiness, and meaningful spending. The discussion also covers the role of community in financial behavior, the impact of delayed gratification, and the future of wealth management in an AI-driven world. Crosby highlights the necessity of practical applications in financial education and the importance of understanding one's relationship with money.

Dr. Daniel Crosby is a psychologist, author, behavioral finance expert and asset manager who applies his study of market psychology to everything from financial product design to security selection.

Key takeaways

Behavioral finance has gained significant traction in the last eight years.
Investors today are better educated and more disciplined than in the past.
The focus of behavioral finance is shifting from avoiding mistakes to enhancing well-being.
Health is a crucial component of wealth and happiness.
Experiences often bring more joy than material possessions.
Delayed gratification is a powerful tool for achieving long-term goals.
Community and social connections enhance financial well-being.
AI will play a significant role in the future of wealth management.
Practical applications of financial wisdom are essential for real change.
Creativity is vital for personal and professional growth.

I hope it helps!

The Soul of Wealth: 50 reflections on money and meaning

Daniel's Linkedin

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In this week's podcast #334 I take a look ARFs

If you google 'best ARF Fund in Ireland' today, you will get many results.

The first few are of course paid-for, sponsored adverts from firms who want your clicks (and are paying handsomely for them!). There are then quite a few other firms who have written about this 'best ARF fund in Ireland' topic.

This week I share a very short piece which shows the actual outcomes of a scenario where one invested in different funds, portfolios and companies over the past decade or more, and what we can learn from it.

And if anyone needs a reminder, an ARF is an Approved Retirement Fund. It is what happens to most of our personal pensions when we start drawing income from them, if we have not chosen an annuity pension. More on all this here if you want a refresh!

Disclaimer

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In this week's episode, I explore crucial financial planning lessons for Irish families, highlighting examples where small oversights led to significant tax bills.

Discover how one family's misunderstanding of Ireland's Dwelling House Exemption resulted in an unexpected €77,000 tax liability, and how another family's mismanagement of the Small Gift Exemption cost them over €65,000.

Learn essential strategies for gifting, saving, and inheritance planning, and understand why precise adherence to tax regulations, supported by expert advice, is key to safeguarding your family's financial legacy.

Good intentions aren’t enough - strict compliance with Irish tax law is essential.
Document and complete transactions properly - incomplete paperwork can lead to significant taxes.
The Small Gift Exemption (€3,000 annually) must involve actual yearly transfers - accumulating gifts without documentation won't satisfy Revenue.
Seek professional financial and legal advice early to avoid costly errors in wealth transfer and inheritance planning.
Understand clearly defined tax exemptions like the Dwelling House Exemption - missing even one condition can result in major unexpected taxes.

Hope it helps!

Disclaimer

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In episode 332 of the Informed Decisions Podcast, Paddy speaks with Glen Gaughran, Director and Head of Business Development at Independent Trustee Company (ITC). With nearly two decades of experience overseeing thousands of self-administered pension schemes, Glen offers insight into how the pension environment in Ireland is evolving and what individuals and business owners need to know. We explore the significant regulatory changes impacting Irish pensions, including the closure of executive and single-member schemes under the IORP II directive. Glen explains how the government’s temporary relaxation of funding rules for PRSAs in 2023 and 2024 offered a window of opportunity; allowing employers to contribute well beyond traditional limits, and how that door has since closed in January 2025, when contributions became capped at an individual’s salary level. We also compare PRSAs and Master Trusts from a planning and tax perspective, highlighting the trade-offs between contribution limits, inheritance outcomes, and drawdown flexibility. It’s an essential discussion for business owners trying to optimise their pension funding while avoiding tax traps and regulatory missteps. Key Insights * Regulatory changes have ended executive one-member schemes, pushing attention toward PRSAs and Master Trusts. * In 2023–2024, PRSAs allowed virtually unlimited employer contributions, making them highly attractive for late-stage funding. * As of January 2025, employer contributions to PRSAs are capped at 100% of salary, significantly reducing flexibility. * Master Trusts still allow actuarial-based contribution limits based on salary and years of service, offering an alternative path. * PRSAs allow the full pension value to be inherited on death, while Master Trusts may require most of the fund to be used to purchase an annuity. * Strategic planning around salary levels, timing, and long-term drawdown goals is now essential for maximising pension efficiency.

Hope it helps.

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Informed Decisions Podcast | Episode 331 In this insightful episode, Paddy engages with Dr. Gregg Lunceford - retirement researcher, Certified Financial Planner®, and author of Exit from Work: What Will the New You Look Like? -to explore the evolving concept of retirement. Gregg discusses the emotional and psychological aspects of transitioning from traditional employment, emphasising the importance of planning for a fulfilling "third age" of life. He offers valuable perspectives for those in Ireland contemplating retirement or a career pivot, highlighting strategies to navigate this significant life change beyond mere financial considerations. Key Takeaways * Retirement is a transition, not a destination Gregg emphasises that retirement today is less about stopping work and more about reshaping purpose and lifestyle in your later years. * Identity and purpose need planning too Many retirees struggle not financially, but psychologically. Planning for how you’ll stay engaged, socially connected, and purposeful is just as crucial as financial readiness. * Partial retirement is rising Gregg discusses the growing trend of phased retirement and encore careers, where individuals continue to contribute professionally in more flexible, meaningful ways. * Ireland’s demographic shift mirrors global trends The Irish workforce is aging, and like in the US, people are living longer and working differently. Gregg’s insights help contextualise these changes locally. * Retirement success is holistic True retirement readiness includes emotional well-being, social networks, mental stimulation, and health - not just a pension fund or lump sum

I hope it helps!

Gregg's book - EXIT FROM WORK: What Will The New You Look Like? eBook : Lunceford, Gregg: Amazon.co.uk: Books

Gregg's book recommendation - Loaded: Money, Psychology, and How to Get Ahead without Leaving Your Values Behind

Disclaimer

EXIT FROM WORK: What Will The New You Look Like?

Loaded: Money, Psychology, and How to Get Ahead without Leaving Your Values Behind

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In this week's podcast, 330, I take a look at Gillen Markets.

Gillen Markets have built a solid reputation as investment managers and advisors over the past decade and a half, led by founder Rory Gillen. They reportedly manage and advise on over €600m for c.500 families.

They made the headlines last week, having announced that they were selling their business to Quilter Cheviot, a UK and Irish based Discretionary fund manager, for an undisclosed sum.

As these things always do; it piqued interest in terms of the consolidation of yet another firm, but also in Gillen Markets own Gillen Market Fund (GM Fund).

So we are sharing a few thoughts on;

Market consolidation going on in Ireland
Analysis of the GM Fund itself (performance, allocation and fees)

I hope it helps.

Paddy

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In this week's podcast I talk about what's on a lot of people's minds - the markets. As many expected, the media ran amock with the 'Liberation Day' announcements, and the resultant panicked actions of some investors led to the markets falling (as they do, a lot, temporarily!). Last Friday it seemed that every post I saw on Linkedin was by an advisor saying something to the effect of 'Don't worry your little head about the markets - we'll be fine'. As advisors, our intent in saying such things is generally always positive, however we don't generally always get that across effectively! Most investors are well-educated and know what is going on in the world, so rather than talk down, perhaps we should express more empathy and less condescension?? Maybe something to the effect of, 'This is bloody terrible' or 'I'm an advisor and I hate market declines'!? Disclaimer

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In this week's podcast I chat with Kevin Carter, founder and CIO of EMQQ, investors in the emerging market technology sector. A really interesting conversation, which I hope you find helpful

Key topics: * What EMQQ does

Kevin's approach
Future of Emerging Markets
Non Traditional Way to Invest in Emerging Markets
China and India

Kevin T. Carter is the Founder & Chief Investment Officer of EMQQ Global, including EMQQ, FMQQ, and INQQ. While he considers himself an active “value” investor first and foremost, he has collaborated with Princeton economist and indexing legend, Dr. Burton Malkiel, for more than 20 years. EMQQ Global is a San Francisco-based investment management and research firm focused on the Emerging and Frontier Markets Technology Sector. Disclaimer

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Back in 2020, I wrote a piece outlining the uncomfortable truth that active fund managers find it hard to wrestle with....that most of them consistently fail to outperform 'the market'.

Fast forward to 2025, and guess what? Nothing appears to have changed.

In this podcast, I'll share the following:

Why low-cost index funds continue to outperform the majority of actively managed funds
The latest 2024 hardcore data that confirms the long-term underperformance of most active managers
Why much spoken-about market concentration isn’t a reason to abandon passive investing
Common arguments against indexing, and why they don’t stack up
How this applies to you if you're approaching retirement and looking for a smart, stress-free investment approach

If you're a successful professional in your 50s, maybe eyeing the exit door at your company, or looking for an exit from your business, you're now facing a different kind of pressure: how to make sure your hard-earned wealth works for you over the (hopefully) several decades of your retirement!

You’re not alone, and the good news is, the data keeps making the case for a simpler, smarter approach.

Let’s dive off the top ropes and explore shall we!?

Oh, as a 'big treat' I took my lads to a WWE event in Belfast at the weekend - it was such an over-the-top show that it's imprinted on my brain, so you'll have to pardon the many wrestling references here :)

I hope it helps.

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In this week's podcast I talk about pension options for self-employed directors. Over the past 3 years, the actual best pension option for self-employed directors has changed 3 times! Not because Financial Advisors and Planners were flip-flopping on their options (or trying to churn new business!), but because Revenue rules kept changing! So to help clear any confusion, and to light the way for directors that need to know, I'll share the following; * -The main pension planning options for directors in 2025

-The best pension option for self employed directors in different situations
-What to keep an eye-out for if you are moving or switching pension scheme in Ireland

I hope it helps!

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In this week's podcast, I chat with Brendan Allen a specialist in property tax. He is a Chartered Tax Accountant and Chartered Tax Advisor, and is the owner of Allen & Co Tax Accountants and Landlord Tax Returns and is passionate about tax talk. Key topics Intricacies of tax of landlords Landlord tax credit Rent pressure zones Pros & Cons Pensions Private landlord current situation I hope it helps! The Mysterious Affair at Styles The World According to Garp Link to our Blog in 2017 and our Podcast here Is It Profitable Being A Landlord??........The Maths! Blog 33 Link to Rental Income Stress Test Calculator Property Stress Test Calculator - Landlord Tax Returns - Landlord Accounts Landlord Tax Returns Brendan Allen LinkedIn Disclaimer

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On this week's podcast, episode 324, I chat with Olympian, David Gillick about resilience and his journey and how he got through some really dark days. Something we will experience as investors. David shares some fun and interesting stories David is one of Ireland most successful sprint athletes. He stepped off the track in 2013 after a successful athletics career which included winning Ireland’s first sprint gold medal in 76 years when winning the European Indoor 400m championships in 2005. He went on to retained his title in 2009 and became an Olympian in 2008. David currently works in a number of areas, mainly corporate wellness and performance. Consulting and supporting organisations, teams and individuals in realising their potential and operating efficiently and effectively to achieve their respective goals. I hope it helps. The Racket By Conor Niland Simon Sinek Start with Why Robin Sharma The Monk Who Sold His Ferrari Andre Agassi OPEN David Gillickwebsite David Gillick LinkedIn @davidgillick On Instagram Disclaimer

Start with Why: How Great Leaders Inspire Everyone to Take Action

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There is more and more commentators shouting from the roof-tops about the massive growth of North American stock values and earnings over the past few years (since Covid really). I’ll explore what is and isn’t really happening, and what one’s practical options are.

Specifically, the following are the claims/alarms being flagged;

US Tech stocks have gone so incredibly well for several years, these companies, and the US is now over-priced and make up larger proportions of Globally Market than they ‘should’.
The future expected returns from S&P500 as a whole, so people ‘should’ now re-allocate to Europe, Emerging Markets and other locations, for future returns

I hope it helps.

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In this week's podcast I talk with Kevin Canning, Managing Director of Quintas Capital. Kevin specialises in private markets and is the Investment Director of The EIIS Innovation Fund managed by Quintas. He is a Chartered Accountant (ACA), a Chartered Tax Advisor (CTA), and a respected member of the Irish Tax Institute, underscoring his comprehensive understanding of finance and taxation. I hope you enjoy this interesting conversation. Key Topics What Quintas does EIIS Innovation Fund How private investing works Kevin Canning - Quintas Capital Kevin LinkedIn The Psychology of Money Disclaimer

The Psychology of Money: Timeless lessons on wealth, greed, and happiness

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In this week's podcast I chat to John Murphy a Director of OmniPro Tax and Legal Limited John is a Chartered Tax Adviser, who works with clients on income tax, tax planning, restructuring to exit planning as well as advising on company law in relation to these and many other matters. We talk about holding companies and family partnerships for smart tax planning. Key topics * Who are OmniPro

2025 changes to tax planning
Business Structure planning
Holding companies
Non Business Assets
Family Partnerships

To learn more about OmiPro's services and contact John head to their website here: OmniPro Tax and Legal Limited

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In this week's podcast I talk to Dr. Jordan Grumet, about the topics he covers in his new book The Purpose Code. Bringing together the topics of longevity, health, purpose and money. The Purpose Code hopes to help you what purpose really is and the role it plays in our lives.

Jordan’s podcast – Earn & Invest

Jordan Grumet.com

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Planning for, and subsequently living (!) a dignified and choice-filled retirement is the biggest financial goal many of us have, or will have. It’s also a journey of uncertainties, and one of the biggest uncertanties is market volatility, both positive and negative.

We have experienced such positive market growth in the past 2 years in particular.

So, in the interest of being prepared financially and mentally :), in this week's podcast I explore the impact of the stock market having an illustrative 30% decline in 2025. This is not a prediction of market mayhem this year, it's a premortem to allow us consider what it might mean for us, how we might or might not react, in order to deliver better outcomes for you.

I hope it helps.

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In this week's podcast, the last for 2024 I talk about Tax Rates for Retirees in Ireland (2025).

We spend a lot of time planning, analysing and accumulating retirement assets, often without clarity on the tax rates for retirees in Ireland! Time to start fixing that dear listener.

Planning take-home retirement income requires careful consideration of tax bands, credits, and income sources. In 2025, singles and couples can benefit from expanded tax bands and additional credits from 2024, which can and will positively affect their take-home income

I hope it helps

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In this week's podcast, I talk about should I stay invested when markets are at all time highs, is something many will rightly ask. And here is the data to show it;

S&P 500 is at 6,090 right now (all-time high)
Eurostoxx at 4,980 now (whisker under all-time high)
Nasdaq at 19,859 now (all-time high)

Large sections of the global equity universe are at or just below all-time highs. Does this mean there is a massive correction coming? Should I move to cash or some other low volatility asset class to protect my pot from a correction? Natural questions to ask. You probably know what my answer will be, but maybe don't know why it will be so.

I hope it helps.

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In this week's podcast, I talk about Index Investing in Ireland – A topic that will be of interest to all

As you know at Informed Decisions, we believe in helping build a secure financial future through strategies grounded in research, not speculation. Today, I’d like to share why evidence-based investing, a disciplined approach driven by decades of data, stands out as one of the most reliable ways to achieve long-term financial success and security.

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In this week's podcast, Paddy chats with Steve Selengut, a.k.a The Income Coach about income generation strategies. An interesting and different approach.

Steve has accumulated over 40 years of experience as a private investment manager, with a strong focus on increasing the spendable income generated by client portfolios. Today, his role has transitioned into that of an Income Coach, where he dedicated to teaching investors how to more than double the income produced by their portfolios.

Steve is the creator and instructor for the unique "Working Capital Model" portfolio operating system and the "Market Cycle Investment Management" methodology, both of which he developed back in the 1970s. Additionally, He introduced several proprietary concepts, including the QDI + PT, Smart Cash, The Investor's Creed, and Base Income. Steve also developed the Investment Grade Value Stock (IGVSI) identification system.

Key topics:

Steve's 4 basic principles
What's it is like in Ireland
Profit taking
Comparing Ireland & US investing systems
Distribution income
Sustainable income

I hope it helps!

Disclaimer

Interviewee refers to Closed End Funds which have a very particular set of Pros and Cons. As always, due your own due diligence, and anything discussed is not a recommendation or endorsement. Closed-End Funds: Definition, Pros & Cons | Seeking Alpha Steve Selengut The Income Coach Retirement Money Secrets by Steve Selengut Jack Reacher Novels

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In this week's podcast, I talk about investment options in Ireland.

There are a bucket-load of investment options in Ireland. It is one of the biggest questions we see and hear from people. Yet, the landscape is fairly straight-forward once we get your head around it.

Plus, the route someone will take with their investments is often not led by logic, but by their internal biases. The same occurs when one is choosing their next car to buy!

Show me someone's car, and I'll tell you what kind of investments they have! So much so, I'll go on record as saying;

"The type of car you drive is a lead indicator of the type of investments options you choose" -Paddy Delaney :)

And to jump right-in, here is how I see the investment routes comparing to cars on the Irish roads!!.....

Discretionary Investment Manager = BMW
Life Insurance Investment Product = Volkswagen
Advised Investment Platform = Honda Civic

This week, having had time to do so, I share:

The main investment options in Ireland (via personal & corporate investment and/or pensions)
How they compare to the car you might (or might not) drive, and why....

I hope it helps!

Disclaimer

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In this week's podcast I speak with Nick McGowan from Lion.ie about protection from all angles. Particularly chatting about questions that often come up from those that are approaching or just starting retirement. Lion.ie is a bespoke protection advisor based in Tullamore that advises on all areas of protection - mortgage, life insurance, income protection, serious illness cover, etc. Lion offers advise to all but specialise in helping those with health issues get protection at the lowest cost. Key topics: * Should we keep life insurance cover

Is there a financial need
Section 72 policies
Death in Service Benefits while employed
Income protection

I hope it helps. The Trading Game by Gary Stevenson Lion.ie

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In this week's podcast, I talk about how much income will €1 million generate in retirement.

Planning for retirement in Ireland involves making important decisions about how to generate reliable income from your pension savings (assuming you use pensions as part of your strategy!).

We're going to take the case of our illustrative friend, Harry Houdini, who managed to escape from high-strain corporate role at the ripe young age of 55!

Key points:

Buying an Annuity to generate income
Using an Approved Retirement Fund (ARF) instead
Pension drawdown considerations
How much income will a €1 million pension pot generate?
How do you make it last?

I hope it helps!

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In this week's podcast, I chat with Paul Molloy from Box Clever Tax. His motto is "to help clients pay the correct and lowest amount of tax possible."

#Please do check some comments made around tax rates & rules, and what is and is not allowable for tax relief, as these are important considerations# We have a chat about owning investment via a company or in our personal names and the tax considerations around that. Key topics

Investing in property
Air B & B taxation
Pensions and the fact that he's not a fan (we'll agree to disagree)

I hope it helps.

Box Clever Tax

Atomic Habits by James Clear

Paul on LinkedIn

Atomic Habits: An Easy & Proven Way to Build Good Habits & Break Bad Ones

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If you're like most people we work with, as you approach retirement , you've probably found yourself asking the question: 'How much do I need to retire comfortably?'

It’s one of the most common questions we get here at Informed Decisions, and it’s a crucial one to address, especially with the financial landscape constantly shifting!

In this podcast, we’ll break it down step by step, using an example to give you a practical sense of what your retirement might look like financially, based on prudent and best-available assumptions.

I hope it helps.

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This week I take a look at Pension Adjustment Orders.

Pension Adjustment Orders are things that none of us probably anticipate we need to know about, until we do. This week I will share the following, in the hope that it might help you or a loved-one;

What is a Pension Adjustment Order?
What type of pension benefits does it apply to?
What is a Contingent Benefits Order?
How do you divide or split the pension benefits following a PAO?

I hope it helps.

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In this week's podcast, I take a look at lump sum invested vs dollar cost averages €1m in Ireland.

Key topic points:

Pros and cons of Lump Sum Investing and Dollar Cost Averaging
A 'look-back' to see which has been most profitable for €1m invested in Ireland
A look-forward to see which might be most profitable in future
Investing when markets are deemed to be 'High'
My conclusion

I hope it helps!

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In this week's podcast we have a fantastic, informative chat with awarding winning, international expat tax advisor, KPMG chartered accountant, and tax specialist, Stephanie Wickham.

Key topics include:

Responsibilities for US Citizens living in Ireland (annual returns/pension income management/how to be compliant)
Considerations for people who are retiring and thinking of spending time/large portions of the year in Portugal/Spain/Non-Eu
Tax domicile
Non property assets

I hope it helps.

Expat Taxes

No Rules Rules: Netflix and the Culture of Reinvention

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In this week's podcast I talk about Guardrails for Irish retirees.

One of the big questions I hear from clients heading into their 'next chapter' (blissful retirement!) is: how much can I actually spend each year without running out of money?

It’s a great question – and one that deserves a well-thought-out answer. As financial advisors, it’s part of our job to help you figure that out, and there are a few different ways we can go about it.

Take what Revenue tells you to!
OR
Take a dynamic approach each year, to try optimise your income and legacy

I hope it helps!

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This week I share a short piece with you to help prepare for relevant (potential) changes in the upcoming Budget. What we'll all want to avoid is seeing a change come into effect that we could have seen coming, and that we could regret not having taken action on! We want to avoid regret, so lets not look back in anger - I heard you say! I'll touch on;

PRSA changes and limits to contributions
Inheritance changes
Pension pot size changes

I hope it helps.

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In this week's podcast we talk about what’s happening with bonds and why you should care.

Over the past two years, we've seen dramatic shifts in the bond markets. Lots of investors and pension holders in Ireland have often large swathes of Bond Funds within their investment and pension portfolios. But often have never had clarity on what they are or why they move around a bit!

It’s been a bit of a rollercoaster, to put it mildly.

I hope it helps.

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In this week's podcast, I cover a topic that I did a couple of years ago. FET is still an issue that I believe awareness is still not as wide as it should be.

Potential Federal Estate Tax (FET) on US-based assets is critical for for us all to be aware of, and is often unknown. If you have more than $60k worth of assets domiciled in the USA, could this be a lurking menace in your wealth??

There are a huge number of people here in Ireland, c20,000 in the top 5 US companies alone, who are receiving US stock options and who therefore own US assets.

I hope this helps.

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This week's podcast was a difficult one to do, and I'm still not sure if it's appropriate or not for this space, but my intent is to look for the positives, and to be reminded of a few key principles, financial and non-financial. I hope it helps, both you and I!

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For those looking to pass on wealth while trying to simultaneously reduce tax on the proceeds, Section 73 investment plans offer a potential solution. These plans are specifically designed and sold to try manage Capital Acquisitions Tax (CAT) liabilities on gifts, and to provide a potentially tax-efficient way to transfer assets to loved-ones. But do they work? Lets explore!

What are they
How do they work
What do they 'cost'
What the commissions are like
Specific scenario testing

I hope it helps.

Paddy Delaney QFA RPA

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In this weeks podcast we have a interesting guest with us - Alan Purcell from Cloud Accounts in Dublin. Alan is unique as he is both a Chartered Accountant and Chartered Tax Advisor. We had a quite broad conversation and covered a lot of ground, which I hope that you find helpful. Key topics include: * PAYE taxes as an employee and what you should consider

Landlord tax planning
How to find a good accountant, what to look for
Business owners, limited companies, sole traders
Pension contributions vs not
Taxes - Personal tax credits, tax bands, capital gains tax, and exit tax

Harry Potter

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For this week's podcast we welcome a fantastic guest, Chet Bennetts. A professor of Financial Planning with a wonderful story about how he got to where he is and shares some interesting ideas with us. Main topics: * Chet's journey to financial planning

His current role
Why he got involved with helping veterans with financial planning
His PhD work

I hope you enjoy and we look forward to having Chet join us again later in the year. A little more about Chet and the AmericanCollege of Financial Services Ender's book series

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This week's podcast is the 300th Informed Decisions Personal Finance Podcast, so it is a little bit different than the usual!

Key topics are:

Inflation vs Investments over the past few years, what has or has not retained your purchasing power
Informed Decisions Financial Planning may be hiring!
I interview my kids, my most challenging interview to date!

Hope you enjoy!

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In this week's podcast I take a look at Section 72 policies. What are they and what's good and bad about them? What would the outcome look like if you saved the premium instead?

Section 72 policies are often discussed as a tool to manage inheritance tax liabilities and to maximise the legacy they leave to loved-one.

I hope it helps.

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In this week's podcast I tackle a topic that's been heavily addressed already, inflation - but in the context of what it means for your pension assets. You may have noticed the Consumer Price Index (CPI) suggesting that inflation rates are easing off from recent highs. However, if we cast our minds back to the mid-1960s to the early 1980s, history shows us that inflation tends to come in waves. It's not gone away - particularly for us long term investors!

I hope it helps

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In this week's podcast I take a look at Bonds

If you've got a slice of your pension or investment pie in bonds—be it individual or a fund, government or corporate—you're in good company. Many savvy investors do, and have always done. It's always been seen as a smart move, a bit of "financial wisdom" passed down through generations! But lately, thanks in no small part that Bonds haven't been doing great, some are second-guessing this wisdom.

I hope it helps.

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In this week's podcast, I take another look at Lifestyle and Default Investment strategies for pension funds in Ireland. Something I've discussed before.

For the past 7 years, I have been making the case for avoiding Lifestyling for most investors (those that can handle volatility). And it's been a lonely place! While I had nothing but positive feedback from investors regarding these pieces - there was been little if any coverage of it from anyone else. Was I mad, or missing something? It appears not.

I hope it helps.

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In this week's podcast, I talk about Larry Fink, Warren Buffet, and my granny's kitchen.

Larry Fink is renowned for his role as the CEO of BlackRock, one of the world's largest investment management firms. Much like Warren Buffett, Fink has earned a reputation as a visionary in the world of finance, leveraging his expertise to advocate for long-term investment strategies and the power of capital markets to drive economic growth.

While it might be considered by some as a 'poor cousin' of the Berskshire Hathaway annual shareholder meeting, Fink publishes an annual letter that gets little coverage but does contain some interesting ideas and reflections on markets, investing and life.

Hope you find it interesting.

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In this week's podcast, I talk about the Wealth of Health.

Something slightly off-topic this week, and something far more concise that usual. I hope it helps you.

A definition of wealth is 'a plentiful supply of a particular desirable thing'.

Money is a desirable thing - and we put a lot of focus here on accumulating and protecting that in an efficient, stress-free and proven way. What else is desirable to most of us?

I hope it helps.

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In this week's podcast I take a look at Fisher Investments Ireland.

Fisher Investments have been around the USA a long time apparently, and recently set-up shop in Ireland, but are Fisher Investments Ireland any good, I hear some ask? Are they a fish out of water, or are they a saviour landed on our shores! Lets find out!

I hope it helps.

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One of my favourite podcasts is The Compound & Friends featuring hosts Josh Brown and Michael Batnick of 'Ritholtz Wealth' in the US. They are irreverent, funny, informative and between them and their varied guests (they call them 'friends'!) share some great insights and information.

In recent weeks they have touched on a wide variety of topics, but two in particular caught my attention most, and I felt might be worth sharing with you in this weeks' podcast.

I hope it helps.

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In this week's podcast I talk about the scandal of UK investment firm Saint James' Place. It is a monstrous financial advice and investment firm regulated by the FCA in the UK.

It has been marred by scandals over the past few years. They've been accused of it all; from 'rogue' investment managers (whose clients are still trying to get their money back), to recent over-charging claims. Is there a lesson for us to learn here about it? Lets take a quick look.

I hope it helps.

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In this week's podcast we talk about Retirement Investment: The Case for Equity Over Bonds.

Research published in October 2023 suggests a significant shift in retirement investment strategies is merited. The research indicates that retirees often benefit more from an equity-focused portfolio rather than the traditional equity/bond split.

In Ireland, embracing an all-equity portfolio comes with its distinct advantages and challenges for retirees.

I hope it helps.

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In this week's podcast I talk about S&P500 and if it's a good idea or not to go All-In.

Should you bet all your investment or pension assets on the good 'ol S&P500? Or would you be considered 'bananas' to do so?!? As with a lot of my podcasts, this is inspired by a recent conversation. Conversations that I love to have and to explore with clients.

Could one say that a financial advisor is not doing right by their clients if they are NOT advising all their clients to go all-in on S&P500 or the Nasdaq??!

It's important to make an informed decision.

I hope this helps!

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Pension Lifestyling in Ireland is rampant.

By my reckoning, the vast majority of people with pensions are invested in insurance company pension schemes using 'Pension Lifestyling'. This week I explore if that is a prudent approach for you as a pension holder on the cusp of retirement, or a useless sales tool that you should avoid like the plague.

I hope it helps.

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In this week's podcast Paddy has a fantastic chat with Anne Lester. Anne Lester is a retirement expert, author, media commentator, top-rated speaker and former Head of Retirement Solutions for JPMorgan Asset Management, where she worked almost 30 years. In 2020, Anne was recognized for her extraordinary lifetime contributions to Americans’ economic security with the prestigious Ray Lillywhite Award. Anne, like Paddy is on a mission, her mission is to help rising leaders to retire on their time and target. Key topics * Financial planning * Anne's journey * How and why she wrote a book * How and why she didn't lead by example all her life * Key things she recommends people can do to rewire and rethink how they go about their own money management

Anne's book: Your Best Financial Life is set to be released on 12 March, 2024. Money Doesn't Grow On Trees: A Parent's Guide to Raising Financially Responsible Children https://annelester.com/ https://www.linkedin.com/in/savesmartwanne/ @savesmartwanne on Instagram https://www.youtube.com/@savesmartwanne Hope it helps.

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Something a little different, and a lot shorter this week.

Far too often, when a prospective client asks me to run the rule over their financial affairs, I see complexity and sophistication, and resultant negative outcomes. It is not their fault, it is the fault of 'experts' plying their 'sophisticated' trade.

I hope it helps.

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On this week’s podcast, Paddy talks about which investments of the past few years in Ireland were the best.

He will analyse two very different investment approaches; one a middle of the road insurance company approach, the other an aggressive multi-national fund manager approach. And before delving in, consider what you believe the meaning of 'best investment' is!?

Depending on your perspective it could be any of the following;

Least volatile
Lowest cost
Most transparent
Highest returns
Most diversified
Most volatile

Hope you find this helpful

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In this week's podcast, we talk about retirement planning strategies for business owners in Ireland.

Retirement marks a significant milestone in life. And I believe it fair to say that it is especially so for many business owners, who have often spent years nurturing their beloved businesses!

In Ireland, effective retirement planning is crucial, not just for ensuring a comfortable retirement but also for optimising tax liabilities.

The main reason I am choosing this short topic this week is because when one hears the words 'retirement planning' one may automatically think of 'pensions'. However, in any effective strategy, a pension is only one of several tools at your disposal to maximise your financial life.

I hope it helps.

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In this week's podcast, we talk about Auto-Enrolment Pensions.

In the second half of 2024, Ireland is hoping to introduce Auto-Enrolment Pensions. Many people will have heard whispers, and some may be fully aware of it. However, for many employers, there is a bit of concern as to exactly what they may or may not need to do about it all!

Let’s take a quick look.

To register for this free webinar CLICK HERE to book your spot.

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In this week's podcast, we chat with Christine Kearney CTA from VengaPeople.

Christine offers tax and business advice to people living in Ireland and Irish people living abroad.

Key topics

Business exit and expansion planning
Estate planning
Residency planning

I hope it helps.

Shoe Dog: A Memoir by the Creator of Nike

Christine Kearney

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Gifting €2m to your family tax free. At first glance, this seems impossible and/or undesirable but with smart planning it is possible to avoid all tax burdens on such a gift, legally and legitimately.

In Ireland, the tax landscape, especially concerning wealth transfer, can be a bit like navigating a maze. The culprit? Capital Acquisitions Tax (CAT), with a hefty 33% rate for gifts and inheritances. This is what we are now conditioned to, but it is frustrating when you see that in the USA for example there is no federal inheritance tax! And while there is a federal estate tax, it only applies to assets over $13m, and the bands start at 18% above that level!

But here's the good news for Irish residents. There are legal loopholes, and we're about to spill the beans on the ones that can work wonders for many of us.

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I recently came across a wonderful infographic showing 20 mistakes that investors make, and which they should try to avoid. It reminded me that sometimes we in the investing world talk down to retail investors, many of whom are way smarter than those actually in the investment world!

It also reminded me of a parenting tip I got once. That was to always encourage a child to do something in a certain way, as opposed to telling them what not to do!

So, instead of saying 'Don't bloody drop that glass', encourage them by asking them 'show me how well and how carefully you can carry that glass over to the table'! The positive impact and chances of success are apparently far higher by doing the latter.

In an attempt to increase your chances of investment success, here are 20 things (yes, just 20!) that I encourage Irish investors to try and do with their long term investing.

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When it comes to leaving a PAYE job or winding-up your own company, there are various types of payments you might receive, or give yourself!

But what about the tax implications of these payments? In Ireland, the tax treatment of payments on cessation of employment can seem like pie in the sky for many people – I'm here to clear the air for you!

I hope it helps.

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In this week's podcast, we talk about how taxation of ARF and your Tax works in Ireland.

We will put to bed the question of how much tax you pay when you reach retirement and draw State and Private pension incomes.

We'll talk about how tax of ARFs works when you make withdrawals and for inheritance and how PRSI works when it comes to an ARF.

Hope you find it helpful.

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Today we have a very interesting and unique chat with Ravi Koka, CEO and found of StockSnips.

Paddy talks with Ravi about how AI is affecting our world and also how it affects the investing and wealth management world.

Hope you find it helpful and would love to hear your thoughts!

The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution by Gregory Zuckerman | Goodreads

StockSnips

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Only last week I talked about Money Market Funds in Ireland and how they should and should not be used by businesses to generate some returns on their liquid cash.

But I want to explore whether Money Market Funds in Ireland are a real and valuable investment vehicle that everyone should consider, or if they are purely a sales tool used by financial advice firms to get money in the door!?

I hope it helps!

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In this week's podcast, we embark on an oceanic exploration of a topic of paramount significance to every discerning business owner, whether or not to use Money Market Funds for Company cash!

Indeed, this topic can and will apply to business owners and non-business owners alike, it's just that business owners are usually more concerned about having large amount of money sitting in cash!

I hope it helps!

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In this week's podcast, we talk to Glenn Gaughran, Head of Business Development & Marketing at Independent Trustee Company (ITC), about PRSAs and Pension Property.

With big changes in 2023 to PRSAs, Glenn tells us some great nuggets about what opportunities are available to those who have or wish to set up a PRSA.

Key points:

What are Trustees
PRSA 2023 changes
Who can benefit from PRSA changes
Master Trusts
Property in pensions

I hope it helps!

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I was fortunate to attend FutureProof last week, the world's biggest Wealth Management and Financial Advice conference, attended by c3,000 Financial Advisors. It was held in L.A, California and so was attended mostly by US and Canadian advisors and institutions.

And given US/Canada are probably 15 years ahead of us in progressive advice in clients' interests, it is a great place to get ideas and inspiration as to how best serve clients here in Ireland.

This week, you benefit from some of that inspiration; where I share the top 5 trends that I observed from being immersed in FutureProof for 3 days

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In the ever-evolving ocean of investments, where trends and fads can shift like the currents of the oceans beneath us, it's essential to keep a steady hand on the wheel.

Amid the chorus of voices clamoring for the latest high-flying assets, one must pause and reconsider the tried-and-true: bonds.

As financial advisors, it's our duty to ensure our clients make informed decisions. That's why we'll discuss why abandoning bonds might not be the wisest move, especially in today's dynamic market

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This week I share some lessons we can learn from Johnny Sexton's reported pension planning in recent weeks! I've not even met the man (yet!) but he is a sporting legend, and I admire everything that he's done (even balling the referees for some of their Cup Final decisions!). And he has set yet another fine leadership example in terms of his pension planning. Let's learn from the boss!

I hope you enjoy it!

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In this week's podcast, Paddy has a fantastic chat with Brad Barret the MD of a $5Bn planning firm.

Brad is a Managing Director with One Capital Management. He advises private individuals and families on their personal investment and advanced planning needs.

In addition, he oversees the firm's Retirement and Corporate Services practice. His firm manages nearly $5 Billion dollars for thousands of families across the United States and abroad.

Brad is the author of, Retire Right: Secure the Right Path to Your Retirement - here is the link to his book on Amazon, and here is a link to his website.

He is also the host of two podcasts, Make Your Money Matter and Pension Attention.

Make Your Money Matter with Brad Barrett

Key topics include:

Favourite part of being a financial advisor
Stork theory
Personalising the approach for each client
Making your money matter
Approaching giving

I hope you find it helpful!

The Psychology of Money: Timeless lessons on wealth, greed, and happiness

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Today I share some thoughts on holding cash, some saucy Central Bank of Ireland research on Irish households, and a warning about going all-in!

Irish Household Wealth

Aside from their regulatory role over financial services, Central Bank of Ireland share some really interesting research and reports. One such recent report was their 'Quarterly Financial Accounts' for Ireland.

For me, one of the greatest signals of our financial health as a nation is our 'Household Debt'. This rate hit a high in 2007 when it stood at €203BN. Working on the basis that there are c3.6m adults in Ireland this was around €60k debt for every man and woman over 18 years of age in the country!

That €203BN debt figure has fallen steadily since 2007, to €131BN in 2020, (€36k per adult) and now sits at c€120BN (€33k per adult).

Read on!

Paddy.

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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!

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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!

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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 2 Part 3 Part 4 Part 5 Enjoy!

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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.

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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

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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

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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 & Business Owners - How & 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

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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

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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

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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.

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Even subconsciously, the question surely pops into most people's heads; "Why Do I Need A Will?"

Given that a large percentage of the human race is reluctant to take action now that will benefit their future self, it is no surprise to hear that the majority of people in Ireland haven't made a Will (which will benefit their heirs and loved ones, and not themselves!). The Farmer's Journal put that figure at 70% of Irish people do not have a Will as of 2022.

In this week's episode, in an effort to shift that needle, I will share with you 7 Important considerations in making a Will.

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This week we bring you our first-ever Guest-Post, all about Entrepreneur Relief versus Pension Contributions. I will keep the author a surprise until the end of the piece (don't fast forward!), and it might indeed be a fairly big surprise when you do discover who wrote it!

Entrepreneur Relief Principles
Pension Contribution Watch-Outs
Comparison of the two approaches
A practical comparison of doing €1m on both

All I (Paddy) will say, is that I sure hope you don't like this style better than my own :).

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This week I share 12 clear signs it's time to retire from your full-time job. Perhaps it is to start some new professional journey, a new personal journey, or a combination of both.

I share this piece in the hope that it will give you hope! Give you hope if you are on the cusp of retirement and doubting if you can or you can't. Give you hope if you are wondering if you are alone, mad, or simply wrong to retire.

Key Takeaways

Your pension fund is healthy and can provide you with a comfortable retirement income
Your children are financially independent
'Work' is incapable of giving you a sense of purpose
You want to spend more time with family and other interests
Your health is starting to suffer

I hope it helps.

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If you have ever heard of Custom House Capital, Dolphin Trust, or Solar 21, you will know that Unregulated Investments in Ireland are commonplace and contentious.

I'm certainly not an expert on these types of products, but I know enough to realise that I wouldn't touch unregulated investments with my own money, never-mind someone who trusts me to mind theirs! So this week, I'll share with you:

What are Unregulated Investments
It's all about the money!
Do they go wrong?
How to spot if something is regulated or unregulated
Why you might consider some alternatives

This piece is being shared based on a suggestion from a long-term podcast listener, so thanks for the prompt!

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This week Paddy chats with Jason Parker. Jason is the author of Sound Retirement Planning, the host of the Sound Retirement Radio podcast, a frequent guest on ABC, NBC and Fox, and the inventor of the Retirement Budget Calculator.

Key talking points:

Key things to know if you'll be ok in retirement
Retirement Budget Calculator
Retirement cashflow
What questions should you be asking about your money when you retire
Temporary safety vs. long-term strategy
Reinforcing your discipline and understanding
Bucket Strategy

I hope you enjoy the conversation.

Resources:

RBC - Calculator (retirementbudgetcalculator.com)

New research shows the bucket strategy is better than previously thought. - RBC (retirementbudgetcalculator.com)

Retirement Calculator: How much money do I need to retire?: Parker, Jason R., Rounds, Hannah: 9798841614555: Amazon.com: Books

Sound Retirement Planning: A retirement planning journey designed to achieve clarity, confidence & freedom.: Parker, Jason R.: 9781727749861: Amazon.com: Books

Books:

Ryan Holiday – Discipline Is Destiny

Ryan Holiday – The Obstacle Is the Way

James Allen – As a Man Thinketh

Randy Alcorn – The Treasure Principle

Other:

Brian Buffini Podcast It's a Good Life on Apple Podcasts

The Treasure Principle, Revised and Updated: Unlocking the Secret of Joyful Giving

As a Man Thinketh (Volume 1) (Classic Thoughts and Thinkers, 1)

Discipline Is Destiny: The Power of Self-Control (The Stoic Virtues Series)

The Obstacle is the Way: The Ancient Art of Turning Adversity to Advantage

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Choosing a Financial Advisor in Ireland is not an easy task! There are many different types of advisors, operating in different ways, being remunerated differently, and all delivering different services.

In this piece, I will share with you;

How to recognise the different types of financial advisors in Ireland
Why Financial Advisors are comparable to prostitutes, escorts and spouses!
How different types of advisors are paid for what they do
Why all Financial Advisors are not the same

I hope it helps.

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In this episode, Paddy has a great chat with Paul Merriman from The Merriman Financial Education Foundation in the USA.

The foundation is dedicated to providing financial education to those of all ages.

Paul shares his wealth of knowledge from decades of experience from starting his own Merriman Wealth Management after retiring to setting up his foundation.

Key topics covered:

Investing successfully
Equity asset classes
Emotions of Investing
Hardest thing about investing
Maths of investing
Follow the history

I hope you enjoy this insightful interview.

Resources:

Merriman Financial Education Foundation Lifetime Investment Calculator - Paul Merriman

About Paul

Here are some helpful resources from The Merriman Financial Education Foundation:

Selecting of the appropriate amount of fixed income (Fine Tuning Your Asset Allocation)

Choosing the best fixed distribution asset allocation

Choosing the best flexible distribution asset allocation

Quilt charts

Investing for Children

The Merriman Financial Education Foundation

Free E-book from Paul - get it here We’re Talking Millions! 12 Ways to Supercharge Your Retirement or here Free E-book

Paul Merriman Podcast

Your Money and Your Brain: How the New Science of Neuroeconomics Can Help Make You Rich by Jason Zweig - Paul's book recommendation

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This week I bring you some facts, no metaphors, no story, just facts about recent and important pension changes in Ireland!

Important changes to PRSAs
Upcoming changes to UK State Pension benefits (applicable to all those in Ireland with some time accrued in HMRC UK State Pension)
Recent changes to Lump Sums from foreign pensions (including Malta etc.)

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I estimate that there are approximately 100 people retiring today, and tomorrow etc. etc. Of these c100 people retiring each day of the week, some are really well prepared and will have a smooth journey.

However, others will be less prepared and so face a little more challenge and hurdles. My hope is that this piece will help a few to blow any hurdles out of their way with ease!

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2022 was a testing investment year for many. Rather than jump headlong into 2023, let's take a few minutes to reflect and observe what we can learn from 2022! To me, there are 3 main investment lessons to be taken from last year:

Inflation continues to be the real risk
Diversification matters
Embrace uncertainty

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Welcome back to the latest Informed Decisions podcast: Transitioning from full time employment. This week we have William Lacey back to talk about his journey toward retirement.

We continue to talk about his progress, his thoughts, and his reflections on what he has learned since he began this journey with us in February 2022.

Zen Habits – Leo Babauta

Die with Zero - Bill Perkins

Dr. Mark Hyman

Fritz Gilbert - The Bucket Strategy In A Bear Market - The Retirement Manifesto

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Investing in Ireland can be like staring into a fog at the best of times, until now of course! You have stumbled upon the oracle which will clear that fog for you! In today's podcast I will talk about:

The 'best investments' Ireland offers
How you can get your hands on them!
Why all of this may be utter nonsense!

I hope it helps

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You have decided to make a career change or take a redundancy offer but can’t help but ask, ‘what happens to my pension benefits?'.

When leaving your job, apart from the small matter of securing your financial future, what to do with your pension benefits is one of the most important things you need to consider. This can be especially so if you and your employer have been diligently contributing to your pension scheme for many years!

Key Points:

Beware 'Advisors' that tell you to move it, without due analysis to ensure it is best for you
You will have 3 main options for your pension benefits when leaving employment
You are entitled to an option statement after leaving, it's important to know what it means
If it is a good idea to combine multiple older pensions into one scheme

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One of the biggest questions for people who are transitioning from full-time employment is ‘how does spending change in retirement?’. It is a difficult question to answer, but there is a lot of research out there, which points to some key takeaways.

Retirees can expect to spend less on food and clothing
You can expect to spend less on transportation in retirement
Expect healthcare costs to increase
Many retirees plan to spend more on gifting
More favourable tax rules apply to retirees
Expect your overall spending to remain broadly in line with current spending

I hope it helps.

Thanks

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In this week’s episode, I chat with Dan Cooper, CEO of ROC Investments, about investing in the character of CEOs of large cap companies.

What return on character as an ETF means
How this ETF came about and how it is implemented
How ROC Investments are trying to deliver returns in excess of the benchmark for investors in their ETF
How they are trying to drive positive change within corporations
The long-term goals of this EFT

I hope you find the conversation interesting and helpful.

Thanks

ROC Investments

Book Recommendations:

Shantaram

Return on Character

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'Safe' Investment funds in Ireland are drowning in the past year, much to the surprise of many investors. In this short piece, you will learn:

How 'Safe' and Conservative Investment Funds are performing
Why 'Safe' Funds are suffering badly
What you can do to improve things for yourself

Thanks

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In this week’s podcast, Paddy talks to Jordan Grumet, a.k.a. Doc G. Jordan is a Hospice doctor who found a passion for personal finance, public speaking, and finding purpose in life.

Jordan's experience working with patients in end of life care brings a really unique, insightful and interesting perspective to living a life with no regrets.

Key topics we cover:

What is important to you
What he has learned from hospice patients about life regrets
Financial independence
Finding what's important to you
Discovering what your identity really is

I hope it helps

Thanks

Jordan's podcast - Earn & Invest

Jordan Grumet.com

Taking Stock: A Hospice Doctor's Advice on Financial Independence, Building Wealth, and Living a Regret-Free Life

The White Coat Investor: A Doctor's Guide to Personal Finance and Investing by James M. Dahle MD

The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life by JL Collins

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This week's podcast tackles 8 of the most common financial mistakes retirees make.

Be prepared for retirement lifestyle changes
Have a plan in place for elder care
Understand how Income Tax works in retirement
Don’t forget about inflation (kinda hard not at the moment!)
Stay active and socialise
Don’t delay retirement planning
Test your retirement lifestyle before retiring
Make a plan for any debt, or gifting

I hope it helps.

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If you are a soon-to-be-retiree, or an already-retiree, you may well be grasped with fear in times like these.

In three short parts, I will outline where we are in the greater scheme of things.

Where exactly are we now?
What we know
When will markets recover?

I hope it helps

Paddy

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This week, I’m bringing you an interview with Santi Burridge, who is the CEO of what’s going to be a very impactful company, I believe in the world of financial planning and financial advice. I met and interviewed Santi at the Future Proof Festival two weeks ago in Los Angeles.

Santi is a great guest, full of energy and who is driving forward. He is here to share what they're doing with Lumiant by bringing value based financial advice to the world and ultimately helping people to live their best life.

He also talks about what has happened to financial advice in general in Australia, which has followed a similar track to the UK and America. And probably a tract that Ireland is heading down in the future.

We also speak about the non-financial spouse. Those people who quite often get left behind by financial advisors and why they are people that we need to engage.

I hope you enjoy the conversation.

Lumiant

The Knowledge Project: #142 Marshall Goldsmith: The Essentials Of Leadership

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Are we seeing the death of ESG Investments in Ireland, before they even got off the ground?

In this piece, I'm going to share a little bit about what's happening in other parts of the world with regard to ESG investing and explore what options we do have here in Ireland.

It's an interesting topic and it's one I'm not fully decided on yet; as will become clear.

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What is most important when deciding to retire?

The road to retirement and the decision to exit full-time employment is an undulating road. It is one that brings up many questions, concerns, and indeed many doubts for lots of people.

This is particularly so when you are fortunate to have a choice on when you actually retire. In that situation, the internal debate could actually give you a throbbing headache!

While only you can make the decision to take an early leap from the purpose and steady income of work, there are some factors that will help you clarify your questions. I hope this helps you, either now or in the future.

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Hello! I hope life is good. This week I’m going to be talking about retirement lump sums and what to do with them. This equally does apply to most lump sum investment decisions that we do or will have to make in the future.

I will talk about the top 3 considerations you should think about when making the decision to invest a retirement lump sum.

Taking or investing a retirement lump sum isn’t a one-off decision. There are many aspects that one should consider both at the point of investing but also on an ongoing basis when taking or investing a retirement lump sum.

I do hope that it is helpful for one and all that choose to listen to this week’s episode.

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I will talk about the top 3 considerations you should think about when making the decision to invest a retirement lump sum.

I do hope that it is helpful for one and all that choose to listen to this week’s episode.

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Having clarity around the management of your RSUs in Ireland is critical to successfully avoiding major tax and succession issues in the future.

In this short piece, I will share 3 critical aspects to US RSUs, and outline steps you can take to achieve successful outcomes for you and your loved ones.

According to the American Chamber of Commerce Ireland, there are 190,000 people in Ireland, employed by US Companies. Many of these individuals are employees of financially successful companies (think Google, Meta, Paypal, Intel, Oracle etc.) and have benefitted from that success, often in the form of Restricted Stock Units (RSUs) from their employer.

Thanks for listening

Paddy

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How are you doing, hope life is good. We have a very enthused, knowledgeable, and contagious personality on the podcast this week. Roger Whitney.

He is The Retirement Answer Man in the US. Podcaster, blogger, financial advisor, community organsier head; he’s a ball of energy.

And he has some great ideas to share with us in this episode. With Roger, you’re going to hear about all sorts of preparations for retirement.

You’re going to hear about a thing called that ‘Tart Cake’, which is a new concept we created in our conversation. You're going to hear about his book recommendation.

His investment philosophy. His approach to leaving both a financial and a non-financial legacy and how to successfully retire.

So we cover quite a bit of ground in this episode, and Roger could talk for days on this one.

Roger Whitney has been a Certified Financial Planner for more than 25 years. And he really is on a mission to help people live well today without sacrificing tomorrow, as he puts it.

Roger’s book recommendations:

Top 5 Regrets of The Dying

Necessary Endings by Dr Henry Cloud

Roger’s website: The Retirement Answer Man

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Escaping Full Time Employment With William Lacey Part 4

Thank you for joining us for what is our fourth conversation with William Lacey who is in the midst of transitioning out of full time employment out to a life of freedom and choice.

In this particular episode it was really interesting to hear William’s progress, transitions and works on the various aspects both financial and nonfinancial.

We continue to talk about his progress, his thoughts and reflections, on what he has learned since he began this journey with us in February 2022.

And what he’s going to continue working on next to aid his smooth, successful transition to full time employment to the life of freedom and choice we mentioned

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"My Bonds & my equities are falling in my pension - I must do something"....said almost everyone who has an invested pension or investment.

It is the natural reaction, and it seems the obvious one, but should you do something, and if so what?

In this weeks' super-short piece I share 3 things you might consider doing about it your Bonds & Equity values falling. I hope it helps.

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Lars Kroijer is our guest on today’s podcast. Lars is a former hedge fund manager, author, and entrepreneur from Denmark.

He talks with Paddy about can we beat the market, investment edge, hedge funds, and many interesting related topics.

Can We Beat the Market? If We Can’t What Should We Do?

Hello and welcome to this week’s episode. Really interesting topic if you’re into investments. If you’re into ensuring that you get the optimal long term return for yourself into the future.

This episode has some really interesting insights from our guest today. I hope you enjoy it.

This is from last year, 2021, but the content, the ideas, and the principles that Lars shared with us are still applicable. Enjoy

Lars Kroijer YouTube Channel

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Welcome, dear listeners. This is the second of our from the archives podcast and this is from a Tribe episode that was launched in August 2021.

We got a really interesting question through the Ask Me Anything function which was a part of Tribe, which is no longer. But the question is a great one.

Here we delve into it in quite a bit of detail and got great feedback from the Tribe members. So, hopefully, this episode is of real value to you. Enjoy

Consolidate Old Pensions, Or Not?

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This episode was originally recorded and published in September 2021 for the Tribe when things, and by things I mean our pension funds and our investments were saving.

They were on the upward curve having recovered from a recent downturn. It’s amazing how short our memories are when it comes to these things.

I’m resharing it now for two reasons:

It’s a really timely reminder of when things aren’t going so well in terms of our pension and our investment values
Because I’m taking a couple of weeks' break from podcasting and other professional duties until mid-July

However, the ideas, the insights, the thoughts, the planning, the concepts, and the confirmations and clarifications without overegging it still stand. The world is not coming to an end we have been here before and we will be here again.

How To Prepare Your Pension For The Next Big Crash. Blog 186

I hope you enjoy!

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Hello dear listener. As promised we have Niall Tinney, founder, and creator of Elder Care Finance joining us for an interview.

Niall is going to share his own learning, his own experience, and really deep insights about what you need to know when it comes to planning for elder care. Whether that’s home care or indeed nursing home care.

He’s going to share information about the application forms
The considerations you need to make when it comes to your planning.
We’ll take a look at the Fair Deal Scheme
The nursing home loan
Concepts around availing of tax relief when it comes to paying for all of this.

I do hope that this is the start of a journey for you to ensure that you’re prepared for navigating this if it is something that you or a loved one might need in the future.

Thanks

Paddy

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Many people are dubious about giving a large gift to adult children. If you find yourself having relatively significant amounts of assets, and adult children, this is for you.

In this piece, I share with you 4 smart ways that might allow you to be both tax efficient and supportive (in the right way) to your adult children.

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Greetings hope life is good. In this week’s episode, we are back with another interview. This week we chat with John Swolfs.

John is kinda unlike a lot of the interviews we’ve done in the past when it comes to people from the world of financial services. John is an organiser of a lot of events. He is organising the Future Proof Festival in September of this year, which happening in California.

He is originally from America and has worked with Blackrock and Barclay’s Global. He was the CEO and Vice President of Inside ETFs, so has a depth of knowledge about ETFs. And he is now the CEO of Advisor Circle.

He brings a real cutting edge view and outlook on things. Which is something that we probably haven’t had before.

We touch on:

ETFs
Bitcoin
Advisors
Financial planning

He is a really interesting guy and I do hope that you find it an interesting conversation and that you get some nuggets from it.

Thanks,

Paddy

Future Proof Festival: Home - Future Proof (advisorcircle.com)

John Swolfs: John Swolfs | LinkedIn

Financial Media Executives Matt Middleton, Josh Brown, John Swolfs, Barry Ritholtz and Matt Hougan Announce ‘Future Proof,’ a Groundbreaking New Wealth Festival | Business Wire

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One of the biggest concerns for most people as they approach retirement is ‘Have we enough to retire?’

One of the biggest concerns for most people as they approach retirement is ‘Have we enough to retire?’. There are a lot of variables (which we will outline shortly), but one of the most significant over the course of a three-decade retirement is the amount that we will spend. This week we share:

The variables to consider when exploring the question, ‘Have we enough to retire?’
The latest research on how our spending changes in retirement
Some practical things to help you achieve positive long term outcomes

Finally, here are a couple of handy tools and insights that might help you in your own planning.

Calculate your tax: free online calculator here PWC Income Tax Calculator
CCPC Budget and Spending Tools here
Our interview with Fritz Gilbert on the ‘non-financial aspects of retirement that many people miss‘
Our ‘When To Take My Pension‘ Article
Our ‘Investing In Later Life‘ Article
Economic & Social Research Institute Report On Spending In Retirement
Our Services for those approaching retirement

Thanks,

Paddy

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Hope you are well, hope all is good. We are back with part 3 of our listener’s journey with William Lacey.

William has been sharing his journey with us as he transitions from full-time employment and his concerns, his hopes, and considerations for the future.

In today's episode, William shares his progress on the following three areas:

His financial arrangements
Decisions on how to successfully exit his business
Considerations on where to reside, and what interests to pursue

Thanks,

Paddy.

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Award-winning Blogger and successful recent retiree Fritz Gilbert shares with us the financial and non-financial aspects of planning and executing a successful retirement.

Fritz discusses:

Financial ‘Bucket’ strategy to manage their finances
The 90/10 Rule of Retirement
Finding purpose and structure once you pass the ‘start line’
The importance of having freedom and choice in retired years
How to ensure you will ‘have enough’ money to retire

Thanks,

Paddy.

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Hello, I hope you are well, I hope you had a fantastic Easter time. We’re back at the coalface and loving it. Speaking of coalface, we have today a guest who is at the coalface of the legals of pension changes in Ireland.

We have a partner of a law firm and he specialises in pensions and what is going on with pensions in Ireland. And it is very, very relevant, indeed to everybody, but particularly those that have established net worth in pension pots.

We look at this from both a PAYE, so an employee’s perspective but also those who might own or run small or medium businesses that typically have Small Self Administered schemes or Executive pensions. So it hopefully answers a lot of questions for all of those individuals. So, I certainly do hope that this conversation with Stephen Gillick is helpful to you.

Stephen Gillick | Irish Business Law Firm LLP Mason Hayes Curran (mhc.ie)

The Pensions Authority - Welcome to the Pensions Authority

Financial Services and Pensions Ombudsman (fspo.ie)

The Only Plane in the Sky: The Oral History of 9/11 by Garrett M. Graff | 9781913183417. Buy online at Charlie Byrne’s

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Merry Easter dear listener, I hope you’re well and I hope you had copious amounts of chocolate or not as the case may be. I’m taking a bit of time out over the Easter Mid Term break to hang out with the kids, have the craic, and of course, help them eat their Easter eggs. That is my duty. That is my calling at Easter time.

Welcome to podcast 221, which we are pre-recording. And which you are getting to listen to a bit of bonus content. Something a little bit different than the norm. It is a really interesting interview with the director of coaching from a company called Win Without Pitching. A US-based pricing strategy, value recognition, company. If that means nothing to you, bear with me and bear with this conversion.

I do believe that the concepts, and the thinking that Shannyn Lee is about to share with us in this podcast interview which was recorded in 2021, will help everyone. It was released as part of the Tribe podcast series last year.

We’re re-releasing it to the general public today because I believe there is so much value in this for everybody. The concepts and thinking will encourage all of us to really consider our value.

Give it the 40 minutes and let it stew in your brain. I guarantee you, if you’re open to it, it will help you in some way, shape, or form.

Thanks

Paddy

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One of the big questions that people we work with ask is; ‘where will we live and enjoy our retirement decades?’.

There is no set of accurate answers to that question – finding the right solution for you requires exploration, discussion and tangible planning.

We are joined this week on the podcast by Mary Conway of Janus Estates, who does this for a living.

As Ireland’s first Certified Senior Move Manager, Mary shares with us some of the biggest considerations people need to make when they look at their options.

I hope it helps,

Paddy.

https://www.irishtimes.com/business/construction/bartra-plans-blackrock-build-to-rent-scheme-for-older-people-1.4844427

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If you are approaching, or indeed planning for retirement (exit from full-time employment) you may benefit from knowing about a strategy which can be both financially and emotionally beneficial; move from Company Pension to PRSAs.

While certainly not a strategy that will be beneficial to everyone, in the right scenario, it can be very much so. This is very different to the more common strategy of moving your Company Pension to a Personal Retirement Bond (PRB/BOB) when you leave a company - which doesn't change anything materially from a strategy/planning perspective.

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Hope you are well, hope all is good. We are back with part 2 of our listener’s journey with William Lacey.

In the first episode, 214, William and I chatted about where he’s at, why he’s doing this particular episode, and series with us as he transitions out of full-time employment. He shares his concerns, his hopes, considerations, how it applies to him, and how his thinking and planning evolved over time. And I’m sharing it because it's a very relevant topic and it's interesting to see a live test case, so to speak, evolve in front of our eyes and share that with you dear listeners.

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Plan for the worst and hope for the best. Everyone is only talking about one of two things at the moment, either a disease or an invasion. However, there are other, much more closer to home events that we ought really be prepared for, but of which few have been giving much thought to, including yours' truly.

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If you are heading towards retirement with zero pension planning done, this piece might help.

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"Daddy, the lady at dancing class had toes coming out of her eyes and coming out of her ears!".

That's what 4 year-old Emily told me yesterday through rampant giggles, and I'm not one to disagree with her! One big observation of recent years as a parent - is the wonderfully wild imaginations that kids can have. Depending on what they may have been absorbing recently, whether it's Harry Potter stories or something lighter, such as 'Cocomelon' nursery rhymes, their minds can take a perfectly mundane daily event or encounter and turn it into a wild and scary thing. It's a wonderful privilege to see and hear it in action. The tangible impact of their imagination running mad are little or none, at least in the short term! The imagination does not usually cause an action or event to occur.

However, the same cannot be said of the imagination of us adult investors, particularly in the face of actual horrific world events, and subsequent detailed coverage of market movements. Reading the home page of any media outlet over the past week may well have had you terrified about your finances, even on days when the markets movements were up! That is their intention - to keep you clicking and reading. Clicks = Revenue, never forget!

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This week we kick-off our podcast series where we share the journey of listener and client William Lacey, as he exits full-time employment.

This is a topic close to many listeners’ hearts, and William has offered to help us share insights that will help others.

William will join us every 6/8 weeks over the coming 12 months.

Each episode will see William and Paddy discuss William’s thinking, actions, priorities, concerns and outcomes as he transitions from full-time running his business.

This week hear his background, where he is right now, and the topics that are next on his list to clarify and decide-on.

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Aside from deciding to actually accumulate money for your post-work living, the decision about 'when to take my pension benefit' is the biggest financial life decision that many of us will need to make. It is akin to breaking open the cookie-jar that we have been diligently accumulating for decades. For many, it is an emotional and financial conundrum, that I hope to help with. A combination of academic research and supporting people in this phase of life has given me some insights that I share here, and which I hope will be even somewhat helpful to you. No single article can address all that needs to be considered fully but the aspects we'll explore today in this questions of 'when to take my pension' are;

The basics of taking pension benefits
Tax & Income factors to consider
Investment/return factors to consider
Personal factors to consider

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In this weeks' (really) short piece I'm going to share with you a couple of thoughts about investing in later life; for those that may be in the final decade or two. Key things covered this week:

A new way to look at long term investing in later life
The madness of only investing in 'low-risk' as you age

I hope it helps you or a loved-one.

Paddy.

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Trust, they say, exists at the intersection of 'Character' and 'Competence'. In this week's piece I'm sharing a short story about a fictional accountant (Steady-Eddie), a fictional Financial Advisor (Friendly-Fiona), and you!

Through this short story we'll look at at trust, and whether it is deserved or not, and we'll look at the murky world of unregulated financial advice and unregulated investments in Ireland. Before I start, I want to reiterate that I know and trust quite a few accountants and financial advisors!

I hope it helps.

Paddy

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Financial Independence, when you hear it, often means different things to different people. For some, it's having more money/assets accumulated than they'll ever be able to spend - for others, it's having regular and reliable income that'll cover their every future need. For others, it's removing as many on-going expenses as they possibly can. Whichever way you look at it though; it almost always goes hand-in-hand with being confident about your financial independence. It is one thing seeing it on paper, it is another to actually believe it and have conviction that it is so.

This week I want to share some brief yet impactful nuggets from a legendary book called 'The richest man in Babylon', which details one man's journey to Financial Independence. I share these nuggets in the hope that it might add another layer of confidence and clarity in your own Financial Independence.

Paddy

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This week I share evidence & facts about investment returns, and also invite you to ask yourself an important question! Our agenda for this first piece of 2022:

The investments returns you should have got in 2021
The investments returns you will get in 2022!
Another way to think about 'New Year Resolutions'

Paddy.

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Hi,

I'm delighted to share with you a conversation I had recently with UK-based Chartered Financial (&Life) Planner, Justin King. He shares his experience on:

How to financially prepare to 'transition' to retirement
Life-Planning's role in considering our priority & future-selves
Justin's views on optimal Investment Management approaches for retirees

Hope you find it interesting,

Paddy

Justin's Youtube Channel

MFP Wealth Management

Justin's Book 'Ready, Steady, Retire'...FREE!

Retirement Cafe Podcast

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Hi,

It is a sad state of affairs when we have to rely on individual authors and thinkers publishing books and articles, in order to help the youth of today to develop financial wisdom. Yet, here we are!

Despite sounding very negative, I was delighted to speak with such a thinker and author, Will Rainey (former Pensions Actuary!). In our conversations he shared his ideas on:

Helping kids to save, spend, & importantly to invest
Investing for younger and older children
What he believes is the optimal approach to investing
How he transitioned from being in 'high finance' in UK to moving to rural Vietnam with his family!

Hope you enjoy the chat.

Paddy.

Dennis Harhalakis - The Money Coaching Institute

Blue Tree Blog

Tim Ferriss and The 4-Hour Workweek (fourhourworkweek.com)

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This week we share a few nuggets that I hope will offer clarity and assurance on a few key aspects of our investment and pensions planning;

-Important changes to pensions in Ireland coming into force

-An update on Active Manager performances

-The link between balance and longevity!

I hope it is useful for you - I sure enjoyed doing it!

Paddy.

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This week we bring you the David Worrell Interview - where we discuss all aspects of Investment Platforms in Ireland.

David is head of relationship management at Conexim Investment Platform in Ireland and shares his insights on the following:

The rise of platforms in UK/USA - and subsequently in Ireland
What platforms actually do - processes and people involved
Pros & Cons for investors versus other routes
Are Investment Platforms 'safe'?
Navigating tax regimes for investors
Transparency issues and opportunities for Irish investors

Hope it helps,

Paddy.

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Robin Powell is a force within the investing world - on a mission to inform the public and financial advice firms of the facts of investing. I was thrilled to have him back on the podcast, having spoken to him in Episode 76 a life-time ago!

In this episode, we discuss:

His progress in dispelling investment myths & educating investors
The role of regulators in making it better for retail investors
What investors should focus on & what they should not focus on!
The Advice Gap in the UK and other countries and how it may be fixed
A great book!

Hope you enjoy.

Paddy.

Invest Your Way To Financial Freedom Book

Evidence Based Investor Website

Adviser 2.0 Website for advisers

4,000 Weeks Book Recommendation

SPIVA Reports

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As with most things in Financial Services in Ireland, (Environmental, Social & Governance) ESG Investing in Ireland is one that takes a bit of figuring-out, if you want to do it right that is! In the hope that it will help you build and protect your own wealth, I share the following in this short piece:

The theory of ESG investing in Ireland, and why it is to be applauded
The practical application of ESG investing for Irish Investors, and why it is less than straight-forward
Some revealing research that shows most ESG investing is not actually ESG at all!
What we will do to get to the bottom of it

Paddy Delaney Informed Decisions

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This week I share some interesting research and insights on how to prepare for the biggest surprises in Retirement, both financial and non-financial.

We will mostly all agree that 'Life' is not about reaching some destination in a particular state. The same can be said of our financial lives, but yet a large focus for most of us is to reach a point in the future where we have amassed sufficient financial resources to be financially independent.

Learn from the people who have been there and done that in this weeks' episode.

Paddy.

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Thanks for coming back to us in this Episode 201!

This week I tell you about bad investment funds in Ireland, it promises to be a doozy! I hope it is actionable and impactful for you in your own wealth creation and preservation. This week I'll share some insights on the following:

Another specific example of the ridiculousness that is Investment Funds in Ireland charging silly fees for delivering absolutely terrible investment outcomes for retail investors like you & I
What you can/could/should do if you are involved in these type of 'all-picture & no-sound' funds
A quick market update for 2020 (it'll be real short)
A quick market prediction for 2021 (it'll be even shorter)
Confirmation that neither the aforementioned 'update' nor 'prediction' matter!

Paddy Delaney - Informed Decisions

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It's not ever day that you get to launch your 200th episode - so who better to help us mark this event than Pete Matthew!

Pete has been at the vanguard of personal finance podcasting and sharing of deep insights for many years now - and was an inspiration to Informed Decisions.

We trusted Pete to take over the show - and it'll be fairly obvious to you dear listener that we should probably ask him to stay!!

Thanks for your continued listenership, support and for being part of the journey.

###October 2021 UPDATE####

In November 2020 following this episode we launched the Podcast Tribe - over the following 11 months we donated €4k to charity thanks to our members. As of October 2021 we are reverting to sharing our insights, ideas and interviews publicly, so you can catch Episode 201 at the end of October 2021 on your usual podcast player!

###See You Soon!####

Paddy Delaney - Informed Decisions

Check out Pete's show if you haven't already - it's great!

Meaningful Money Podcast

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Dr. Sarah Fallaw shares her insights on the following:

Her research of wealth builders all across the US
What works and what doesn't work
How our behaviours and personalities impact on our wealth creation
Her latest book, a combination of her and her late father's research

I hope you enjoy,

Paddy Delaney Informed Decisions

Resources:

The Next Millionaire Next Door
Datapoints
The Millionaire Next Door

The Next Millionaire Next Door: Enduring Strategies for Building Wealth

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Investment Trusts have been in vogue for a little while - in no small small part due to the tax treatment of any realised gains. Many investors are hell-bent on finding an option that might allow them to invest in a diversified and low-cost way, and try to invest via Capital Gains Tax regime as opposed to Exit Tax regime. Some believe Investment Trusts in Ireland allow you to do that, but like many things it's not as straight-forward as that!

Hope it helps,

Paddy.

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Hey!

Financial Service firms love their acronyms, as in they love them! Maybe it's an insecurity thing, or maybe it's an attempt to hold onto some semblance of power. To help you develop the knowledge and to prepare you for a conversation with even the worst acronym offenders (AO!), I'm covering each of the main investment and financial acronyms related to financial services in Ireland. Plus, I'll offer a one-liner on each as to what it really is and why it matters!

Paddy Delaney QFA RPA APA

Informed Decisions

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Tax on investments in Ireland is a doozy! There is a warning often quoted in investment articles that suggest "you shouldn't let the tax tail wag the investment dog". Based on a recent conversation I had with a prospective client and from many emails that I get from investors, it seems that people aren't even aware that there is a tail! This is an important part of investing and is a significant issue for many investors, so I made sure to allocate sufficient time to get to write a short piece to hammer the message home!

Paddy.

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This week we chat with Todd Tresidder, financial coach and educator at FinancialMentor.com. He's also the author of five financial planning books.

You'll learn about:

How to build wealth
What stops us reaching Financial Independence
Using leverage to help you get there

Todd built his own wealth as a hedge fund investment manager before "retiring" at 35 to teach others. Today, he provides advanced investment and retirement planning education at FinancialMentor.Com showing what works, what doesn’t, and why based on a depth of proven experience.

Hope you enjoy,

Paddy Delaney Informed Decisions

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Something a little different this week - give it a go!

If your life was one week long what day of the week would you be on, and what would you do about the rest of the week!? We explore this, and aspects of our financial lives that will hopefully help you to avoid mistakes and achieve your priorities.

Hope it helps,

Paddy Delaney

Informed Decisions

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In this episode we share:

Why I get stick about our cars
What Opportunity Cost is & why it matters
How to go after what is really important to you & stop wasting money on the unimportant

I hope it is helpful.

Paddy Delaney QFA RPA APA

Paddy Delaney Informed Decisions

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What's Love Got To Do With It, Baby They suggested that we hate losing something about twice as much as we enjoy gaining something! Think about it - in all walks of life it holds water. Take 'love' for example. I remember vividly when I was unceremoniously dumped by my first girlfriend! I was about 15 at the time - and 'devastated' was not the word for how I felt! Despite my father telling me; 'Cheer up son, the next one is always better' (!!!!) I was inconsolable for a week or two.

Did 'the next one' bring as much joy as the being dumped brought pain - we'll see!

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Actively Managed Funds under-perform Passive Index Funds in the majority of cases. Managed funds usually exist in order to beat the market. They generally don't succeed. This is not an opinion or a prediction, it is a fact which you will see full evidence of in a moment.

I will start however by reminding you of another fact. Your behaviour as an investor will have potentially far more of an impact on your investment success than whether you are invested in actively managed funds or passive. By 'behaviour' I mean whether you stick to the strategy or not when your portfolio is either screeching upward or downward at a future date. With that irrefutable truth out of the way, lets look at the facts.

When it comes to investing and choosing the best available solution, whether managed funds or passive or whatever, we like facts. We try to ensure you, dear reader, have access to facts. We abhor opaqueness and smoke-n-mirrors when it comes to you investing your future wealth. Whether it is a kids savings account, a windfall, a retirement pot, your life savings or a retirement income vehicle. Facts are the only things any of us should focus on.

Paddy Delaney QFA RPA APA

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This week we share a short piece from the Oracle of Omaha, Warren Buffett.

We learn about 'Gotrocks Family', how they had it all, and how they managed to throw it away, or more accurately, to have had it taken away from them!

I consider if this 'informed turkey' is actually voting for Christmas?!

We also share our view on how Irish investors might avoid such disasters, and to keep more of the returns they deserve.

Hope it helps,

Paddy

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What is the Standard Fund Threshold in Ireland? This week, in what is a short 4 day work week, we share a short 4 minute read that will give you most of what you might need to know about the Standard Fund Threshold, for now! You'll learn the history, the current threshold, the REAL threshold, and a little-known nugget that can help you squeeze the max value and tax efficiency out of your pension pot. I hope it helps.

Paddy Delaney QFA RPA APA

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This week we share an investing concept that applies to investments and pensions equally. If I successfully and coherently share here what is in my head, it will hopefully help remove stress for investors as they begin, continue or end their investment journey.

Paddy Delaney QFA RPA APA

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If you are lucky, every now and again you will get introduced to someone that opens your eyes, that adds real value to you. I've been fortunate, partly due to my general curiosity and partly because I've been blessed to just encounter some really interesting people, to have met several such influences recently. This week, in a very short piece I'm aiming to share the love a little!

Paddy.

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Will 2020 Be The Best Year Ever For Irish Investors? We take a look at some of the headline facts of recent performance, to shed some light. We also share a few concise truths that Irish investors (as distinct from speculators) might benefit from being reminded of.

Hope it helps.

Paddy Delaney QFA RPA APA

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When Chip offered to appear on the Informed Decisions podcast we jumped at the chance to speak with him.

Chip Munn is a senior financial advisor and CEO of Signature Wealth Strategies in South Carolina in the US. He is the author of The Retirement Remix: A Modern Solution to an Old School Problem, and host of The Retirement Remix and Maximum Advisor podcasts.

Chip shares his ideas on:

building successful businesses
retiring with purpose, and on your terms
the role of financial planning in our lives

Hope you enjoy,

Paddy Delaney.

Chip's website:

Book Recommendations (Irish websites to buy them if you wish - not affiliate links!!)

The 4-hour work week

The E-Myth

Rocket Fuel

Paddy Delaney Informed Decisions

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Patricia Rickard Clarke has unique experience in preparation for, and planning for future life. Patricia shares her insights on:

Preparing for our financial future
Preparing for care and health wishes
Preventing and avoiding abuse issues of ourselves or loved-ones.

Patricia has, and continues to work across many organisations and groups who are focused on the promotion and development of rights and wellbeing of people who are or may at some point be vulnerable.

Resources:

https://www.safeguardingireland.org/about/

https://www.sageadvocacy.ie/

https://www.mhcirl.ie/DSS/

https://hospicefoundation.ie/

https://www.easons.com/being-mortal-atul-gawande-9781846685828

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Hi,

If you are wondering 'how does an ARF work', may I suggest we consider instead the question; 'how should an ARF work'!? Given that your draw-down strategy in retirement will be one of the biggest financial decisions you will make in your mature life, this really is a topic worth doing some homework on.

Unfortunately, ARFs are generally managed in a pretty laissez-faire manner by most providers. They take your money, stick it into a mid-volatility fund and hand you a cheque every month for 4% of the average over the month, and let your hard-earned pot do whatever it will do. There are options.

Paddy.

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This week I share with you 5 instances where you should seriously question the advice you get from your financial advisor, and some questions to ask to help explore the suggestions!

Now, if you've got a good one whom you trust, your Financial Advisor can be the difference between you having a successful financial life, and not. But if your advisor gives you a bum steer that you act on, the impact of that could be significant on your long term financial success.

Paddy Delaney Informed Decisions

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Dr. Thomas Gilovic has conducted several studies, some spanning decades, which measured the level of satisfaction and joy that people get from experiences versus material purchases. Here is a link to one particular study he was involved in, the insight of which is really quite fascinating. There appears to be three core reasons that experiential purchases give us more long term satisfaction.

Hopefully you get some value from this week's episode. Enjoy!

Paddy Delaney.

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What happens my pension when I, you know!? I'm never one to shirk the hard questions, but it seems crass to talk of 'you know' while all of 'this' is going on!

If you are any of the following, you really ought to know about this:

A director of your own company with pension benefits
An employee and an active member of the 'Company Pension Scheme'
A former employee of a company, with benefits still in your old employer's 'Company Pension scheme'

"Life is like playing the violin in public and learning the instrument as one goes on", or so said the 19th Century English author Samuel Butler. I'm including that quote for no other reason than I really like it. A friend of ours recently had a baby, and she is bouncing hundreds of questions off Fiona (who is an 'old hand' at this stage!). It just goes to show that we are all learning. None of us know everything - a valuable lesson in humility in times like these!

I hope this helps, even a little!

Paddy Delaney Informed Decisions

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In this weeks' Podcast you will hear from someone with some unique insights on the topics we discuss week in and week out. Dr. Moira Somers from Canada is someone I have admired and benefited from learning from in recent years.

In our conversation, Moira shares some ideas around:

Why money decisions can be very difficult for many of us
What we can do to make it a little easier
When to seek financial guidance, and how to find one that will help you most
Moira's top tips to reach your financial priorities

We hope you find it of real interest, and of value to you.

Thanks,

Paddy Delaney

Dr. Moira Somers Website:

https://moneymindandmeaning.com/about-moira/

Advice That Sticks Book:

https://www.goodreads.com/book/show/38821455-advice-that-sticks

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Wondering what the best investments 2020 are?! Or if your investments or pensions are down the pan!? It is indeed one of those 'once every 5 year' situations for investments at the moment (more on that later), but we hope to share some insight that will help you see the wood from the trees.

If you are a regular or occasional visitor or listener of this site you likely have a fair idea of our response to the question of which are the best investments 2020. Short answer remains; investments which are low in cost, high in diversified equities and high in a decent track record versus it's peers. But, has the sheen of that 'Holy Trinity' been tarnished based on how 'things' have gone so far this year!? Let's see.....

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This week, as promised in our recent Pros & Cons of Pension Property, we share with you further details of owning a Property within a Pension.

We were delighted to have Tommy Neilsen, qualified Solicitor and 'Head of Legal' with Independent Trustee Company (ITC) Dublin. Tommy has been with ITC since 2005, and deals with all legal aspects relating to the Pension Trustee services they provide.

In this episode you will hear:

Legal considerations around Pension Property
How the structure actually works
How safe it is or isn't
Further Pros & Cons
Lessons Learned

As chairman of the Law Society’s Sub-Committee on Pensions and chairman of the Association of Pension Trustees in Ireland, Tommy brings a level of knowledge and understanding of Pension Property that hopefully helps you in learning about it.

Thanks for listening,

Paddy Delaney

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How would you feel if you discovered you were paying double the level of fees on your pension or investment that you were led to believe? ‘Clarity On Fees’ is the #1 thing consumers say would improve the level of trust they have in Financial Advice. 76% of people do not know how or what their Financial Advisor is paid. Most pension holders have no idea they are likely paying over 2% fees every year. These are just a sample of the startling results from consumer research we recently conducted. As someone who is hell-bent on finding a win-win for both Consumers and the future of Financial Advice, these results are pretty terrifying, for everyone involved! There is an urgent need for the Financial Advice profession to pull it’s socks up, and to start playing fair with you the consumer. Either it does, or it’ll be sat on the Sub’s Bench for eternity.

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Paddy chats with Ireland's former Pensions Ombudsman, Paul Kenny. Paul remains an active member of the pension profession in Ireland. Among other roles he is remains a Programme Leader in the Retirement Planning Council. In this episode he shares his insights about the following relevant topics:

Keeping track of your pensions when you move employments
Ensuring your ARF gets treated as per your wishes
Impact of ARF values on your eligibility to allowances

We hope it is of value, and please do spread the word with anyone you believe needs to hear what he has to say!

Paddy Delaney Informed Decisions

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Should I buy property with a pension? Ever wonder what the pros and cons are if you did decide to establish a pension property? Is having a pension property a good idea? Hopefully this will help. In the short piece we will share:

Financial benefits of buying a property with your pension
The pit-falls of having a property in your pension
Some other insights that you should know

Paddy.

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1st April 2020 will bring with it the dawn, or the dusk of 'Independent Financial Advice' in Ireland. I really have no clue which way it will go! At least initially, finding an actual living, breathing and practicing 'Independent Financial Advisor' in Ireland may be like the proverbial hen's tooth. (Wouldn't that be a novel name for a Financial Advice firm - 'Hen's Tooth Independent Financial Advisors'!).

I hope it helps in some small way.

Paddy Delaney Informed Decisions

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'Are Equities For The Scrap Heap'? I feel compelled to nail our colours to the mast at the outset. I am always open, and deliberately expose myself to contrary thinking, the fact remains that Equity investing has delivered the greatest outcomes for patient and long term investors. That fact will have come into question in people's minds in recent weeks, so I'm going to share with you in this short piece exactly where Equities are right now - and encourage you to decide for yourself.

Paddy Delaney

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What to do with my investments and Pensions in a declining Market? Absolutely Nothing. That is all.

Listen-on for a 'slight' elaboration!

I hope you are keeping well - that must remain a priority.

Paddy Delaney

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This week, following a recent conversation (there I go with 'conversations' again!), we share a detailed analysis of the Davy GPS Funds. You may be thinking of investing, or are already invested, via pensions or investments.

Either way, we share insights on what are they, what's in them, how they compare to their competitors, and how they have served investors that have entrusted their funds in them.

I hope it helps.

Paddy Delaney

Warning....The value of your investments will rise and fall. You could get back less than you invest in any investment. But you knew all that! All info correct at time of analysis early March 2020.

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Welcome back to Ireland's award-winning Financial Planning Blog & Podcast. This week we were excited to chat with return-guest, Derek Bell of the Retirement Planning Council (RPC).

In this episode Derek and Paddy explore and share insights on:

State Pension changes
Income Tax in retirement
RPC courses & supports
Common retirement planning mistakes
Retirement spending Do's & Don'ts
Retaining control of your Time in retirement

And more!

We hope it helps.

Paddy Delaney

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This piece is inspired by some recent conversations. These conversations have got me thinking about Financial Independence. It also reminded me how much I love conversations with other people - how the words that other say can have such meaning and depth to them, it's quite a thing! Thanks too to the recent iTunes Review-leavers - such positive words of recommendation and encouragement, thanks!

Perhaps you have already reached Financial Independence but you just haven't realised it yet! Or perhaps you are afraid to consider it!

I hope this gets you thinking a little.

Paddy.

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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

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What is the relationship between life and your money? Listen to this conversation we had with George Kinder to hear more about Life Planning.

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

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What is the relationship between life and your money? Listen to this conversation we had with George Kinder to hear more about Life Planning.

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

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This week there have been two 'big news' revelations about Irish Commercial Property Funds, neither of which will be deemed positive. This media coverage has many thousands of investors very concerned and dare I say, anxious.

In a break from tradition, I am engaging in current market events, in the interest of helping ease some anxiety for investors. This week we share some ideas and experience which might be useful for anyone who has concerns about their investments in Irish Commercial Property Funds, whether through your pension or investments. I hope it helps.

Oh, so as to be totally clear, a couple of comments on where we stand on these funds.

Firstly, whatever about investing directly in bricks and mortar or via a clients' pension structure, Commercial Property Funds are not something we engage with for our clients (partly due to the very things that are currently happening to investors in them)

Secondly, we have zero professional financial planning relationship with any of the companies that are getting the brunt of the media coverage this week. We are on the side of the investors on this one. This is a message aimed at giving some context for investors that are 'in the eye of the storm'.

Paddy Delaney QFA RPA APA

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Many of us hear about Financial Independence, and it being a distant objective. But does it have to be a distant objective?? This week we chat with Kelvina Galavan (Mrs. Smart Money) about her journey, and how she, her husband and kids have begun living on their own terms. They took control of their finances, and are reaping the rewards!

I hope you enjoy the chat as much as I did!

Mrs. Smart Money website

Paddy Delaney QFA RPA APA

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As of March 31st 2020 new Central Bank of Ireland rules will mean that only a financial advice firm that does not receive commissions from sales of products will be entitled to state they are an 'Independent Financial Advisor' in Ireland. These firms (of which Informed Decisions is one of a handful in the country), will be entitled to use the term 'Independent' in describing their service. That will see quite a few firms which currently use the term Independent having to get websites altered and cabinet-fulls of marketing materials re-printed. It is intended, I understand, to help consumers more easily identify what type of advice they are likely to receive, based on the firms' description. I've said it before and I'll say it again, there are hundreds of really great advisors in Ireland - irrespective of what title they go by. You and your financial future stand to do far far better with even an average advisor than with no advisor - that fact has been proven time and time again.

Anyway, back on track, this week I hope to share with you 5 signs that suggest you need to engage an Independent Financial Advisor. The 5 signs that I am about to share, while I might like to think so, is not an exhaustive list, and is based on my own experience working with valued clients directly, and also with Independent Financial Advisors across the country. Everyone will have their own individual motive and driver for seeking financial advice, but the following will perhaps help guide you if you find yourself with one of these headaches.

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A lot of folk, mostly at the encouragement of some advisors, decided to invest in Absolute Return Funds in Ireland. While they promised a lot, many of those same people are now questioning the decision to do so. This week, on Ireland's #1 Finance Blog & Podcast I hope to help you understand what they are, why their performance have been pretty rubbish, and whether they are worth staying in or not! This is an un-biased(ish) review of absolute return funds in Ireland. I hope it helps.

Paddy Delaney QFA RPA APA

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Welcome to Ireland’s award-winning investment and financial planning Blog & 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

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Welcome to Ireland's award-winning investment and financial planning Blog & Podcast. If you are wondering if now is the right time to invest or not, this piece might be of some value. Indeed if you are unsure if you should invest in equities now, or wait for the crash, this Blog-post hopefully will help educate and inform, a little!

Paddy Delaney QFA RPA APA

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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

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Looking for Financial Advice in Ireland you can trust? A few weeks ago I did a piece on finding 'Independent Advice in Ireland', this week I intend to share some ideas that might help you evaluate a firm before engaging them.

"I just checked my investment portfolio - now I know why they call them Brokers" - anonymous. I came across that quote in a sketch cartoon recently and found it amusing. With MSCI Index up over 20% so far this year it's not really applicable however!

Perhaps you already have an advisor but are unclear about their intent, fees or abilities. You may have had several over the years but none really 'did it' for you! Or perhaps you are thinking about engaging one for the first time. I hope this piece will help a little.

I fully accept also that being a fully independent fee-based advisor, I will carry some biases here - but as always I'll tell it as I see it.

Paddy

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This week I aim to share some brief insights that might be worth knowing when you are building an investment portfolio in Ireland.

When it comes to investing it’s probably fair to say that there is so much choice, probably too much! Reminds me of that weird situation referred to as the ‘paradox of choice’ where, when confronted with too much choice we can stall, suffer from inaction and often make choices that are far from the ones that really wanted! Barry Schwartz’s TED Talk is here, worth a watch!

That same paradox seemingly happens to often to investors and pension-holders in Ireland also. When we are faced with a choice of multi-asset funds, private banking funds, insurance products, index funds, Lithuanian car parks, Alaskan leisure centres, you name it, there are options available for all tastes!

Paddy QFA RPA APA

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Expat Tax is a subject that I often get asked about from listeners. These are individuals that may be leaving or returning to Ireland. Tax being such a specialist area I felt the best thing to do was to invite someone onto the show who specialises in tax mobility.

I was delighted to be joined by Barry Murphy of Expat Tax Services Ireland (www.etsi.ie). In this episode we discussed and chatted about:

Tax Domicile and Residence, and the impact these have
Pension transfers across different countries
Applying for tax reliefs and grants on relocation
Employment Tax Reliefs
How to benefit from State Pension if living/relocating from abroad
Special Assignee Relief Programme (SARP Ireland)
How to split your tax year between countries
Foreign Earning Deduction (FED Ireland)

Expat Tax is such a niche area, with limited credible information available.

If you know anyone currently living abroad whose thinking of coming back to these fair shores, do them a favour and send this to them! And vice-versa!

I hope it is of value.

Paddy.

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Ever wondered which is the best multi-asset investment Fund in Ireland?? Well if you have, you came to the right place!

Welcome back to Ireland's dedicated Investment and Financial Planning Blog & Podcast! In my work with clients I frequently get asked about Multi-Asset Investments, whether they are any good, and which ones might be best. So this week I aim to answer a question that I think has yet to be answered in these parts; which is the best Multi-Asset Investment Fund in Ireland!

Owning any investment is kinda like 'Pick n Mix' sweets, you can have all of one type of you can have lots of different types in the one bag!

Paddy Delaney QFA RPA APA

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'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.

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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

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I was fortunate enough to get to attend the annual Nucleus Platform Conference in Manchester last week. They had an agenda with some of the most exciting speakers in Financial Planning from Canada and USA. While Nucleus are a UK-only platform I was really chuffed to get on the ticket, and made full use of my day over there, meeting lots of quality advisors, hearing some extra-ordinary speakers, and have a super fun time too!

In this episode I get to share insights with you from the following:

Westside Financial Planning, Sheffield.

Vanguard

Michelle Hoskin

Nick Lincoln

Alan Smith

I hope it is of some value!

Paddy.

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When it comes to Financial Planning in Ireland it is fair to say that it is a pretty new service to many. It seems many of us are aware of the role of traditional Brokers and Insurance Agents, but perhaps not the same level of awareness or understanding of Financial Planning. In this short piece I hope to convey what Financial Planning is and how it can potentially be of significant value to people.

Paddy Delaney

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I frequently get asked by listeners and readers about funding into a Self Administered Pension. There seems to be a lot of confusion about what it is, or indeed isn't, and who they are or aren't well suited to. So that is this weeks' objective, to answer these very queries. I hope it is of use.

My father used to shoot. He'd go out with his busted old shotgun with the stock taped on with insulation tape! He'd walk around fields for what seemed like days at a time, coming home with the occasional pheasant! As frowned upon and macabre as that may seem to some today, when you are from the midlands of Ireland that was (and remains) the equivalent of golfers hunting for birdies today! I remember vividly the first time he took me out shooting. Being fiercely animal-centered I wasn't up for shooting any live animal, but I do remember taking my first shot with a shot-gun in the wilds of Kilkenny. Aiming for a tree, with nerves and an unsteady hand (I was 10!) I let fly a cartridge, missed the tree and very nearly shot a passing duck. Luckily he passed unharmed, but that was essentially the beginning and the end of my shooting career! Whenever I see a duck these days I'm reminded of that fond memory.

If It Looks Like A Duck, Quacks Like A Duck, Its A Duck!

A Small Self-Administered Pension Scheme (SSAS) is just that, a pension, which is small in number of members, and which is self-administered! There are lots of misconceptions about what they do and don't do. If you like detail then I strongly suggest reading this, Chapter 19 of the Revenue's Pension Manual. That will keep you going for a while!

I get a lot of questions about Self-Administered Schemes, so here are some of the typical questions I get asked about them, and a broad answer to help get some clarity around them.

Thanks for your time.

Paddy.

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Welcome back to Ireland's award-winning Financial Planning Blog & Podcast, with me Paddy Delaney. Delighted you have decided to join me! This week we are going to explore an approach to retirement income planning that I mentioned months ago. It is customary for retirees in Ireland to decide to generate pension income by using either an annuity, or an ARF. In Blog113 we explored the pros and cons of both of these in isolation. However, as we like to look at things a little differently here we're going to dissect the merit or otherwise of using a combination of the two.

If you google it you'll find millions of results for articles and pieces outlining why an ARF or why an Annuity, but you might struggle to find one which addresses the topic we are about to! We will briefly summarise the probable outcome from using an ARF only, an annuity only, and only then will we analyse using a combination of both.

Paddy Delaney RPA QFA APA

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Welcome to Ireland's award-winning Personal Finance Blog & Podcast. This week we explore a topic which is being asked more and more, what fees are payable, and what is the impact of these fees on a pension, with particular focus on Approved Retirement Fund (ARF). We will not just determine the impact monetarily but also the impact on how long that ARF might actually last you, which is kind of a big deal! This won't be a long episode, but I sure hope it helps shed some light on a dark corner! If you haven't already caught last weeks' episode, which helps explain how to maximise the duration of your ARF, you can grab that here.

Now it goes without saying that you get nothing for nothing, and that we will pay fees in both the accumulation phase of pension/retirement planning, and in the spending-phase. Much like an egg-timer, where you turn it over, there is no halting it, there is a finite amount of grains in the top and there is a finite amount of time before they all pass through. We are precious of every grain, we only have so many to use. I guess in this case what we are trying to do is to be aware of any grains that might be escaping out the sides without us even knowing about it. We're looking to plug any leaks!

The focus of this piece is very much on the impact of the fees on our ability to draw income from an Approved Retirement Fund over the course of our 'Life 2'!

Paddy.

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Welcome to Ireland's #1 Personal Finance Blog and Podcast, with me Paddy Delaney! This week we explore an important topic for many, and that is managing our income when we leave full-time employment. When we enter 'Life 2' we are switching from accumulation to spending, which is a big shift for many people to take. I hope this piece offers some insights that will help you.

In this article I aim to answer the following questions that I frequently hear in working with clients who are in this stage, and for many are a cause of concern, until answered:

How much can I safely take from my Approved Retirement Fund?
Should I be flexible about how much I take from my Approved Retirement Fund (ARF)?
Should I invest in Bonds in order to avoid volatility

Drop me a mail here.

Paddy Delaney - Informed Decisions

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Welcome back to the #1 Investment and Retirement Planning Blog & Podcast in Ireland. Of late our focus has been very much around preparing our finances in advance of, and indeed after we leave full-time employment. Some people call it retirement, other people don't like that term (hear Fin's interview here!).

This week, as promised we will explore that big question for many, When can I retire? A few readers got in touch after Blog 118, where we looked at maximising the income you achieve from an ARF. They were asking why not just retire earlier? So here we go!

Oh, for those of you that don't like the term 'retirement' I'm delighted to share an alternative! I came work by a US guy, Don Ezra recently. All about preparing for retirement. He calls retirement phase 'Life Two'. He suggests it came about when the accronym for 'Life After Full Time Work' (LAFTWO) was converted into 'Life Two'. I like it! I also like 'Accumulation' phase and 'Spending' phase however if you are anything like many who find their calling in Life Two you may find yourself so busy that you don't have much time for spending!

See website for full Blog 119

Paddy Delaney

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The concept of Financial Independence Retire Early means different things to different people. Friend of the show, Fin Goulding has no shortage of experience when it comes to the investment and insurance industry, and joins us on the show to share his own take on FIRE, and how people can achieve Financial Independence.

Be sure to stay till the end where Fin shares his take on how to manage and achieve long term investment success.

Paddy Delaney

Fin's Twitter

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If you have, or are soon to have, an Approved Retirement Fund (ARF) you might benefit from the following research. Wondering how to make your ARF last longer? How to generate as much income as feasible from your ARF? This week we continue where we left off 2 weeks ago, and as promised share some strategies that can

Welcome to Ireland's #1 Finance Blog, where we're on a mission to share insights that'll hopefully help you with money. If you have any questions, feedback or suggestions on the back of this piece please do get in touch with me directly here. Would love to hear from you.

Paddy

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Welcome to Informed Decisions Podcast, Ireland's #1 Finance Blog & Podcast.

As we continue out focus on managing and optimising pension and retirement income in Ireland we are delighted to bring you one of the leading lights in the academic research of this topic, Abraham Okusanya.

As the creator of Finalytiq in the UK, author of 'Beyond the 4% Rule', and host of the 'Science Of Retirement' Conference there is not much that he does not know about delivering results for customers in their investing and retirement planning. Sit back and enjoy!

Paddy Delaney

P.S. apologies for the dodgy sound quality when I am speaking - my fault entirely. Will sort it for the next interview!

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How long will my ARF Income last? This week we continue our analysis of how we can actually go about drawing and maximising our pension and ARF incomes when we reach the age where we start to 'spend' instead of 'accumulate' our money.

For me at least this is the fun bit for us. We don't have pensions because we want a pension, we have pensions because we want what it can potentially give us. Ultimately what it will hopefully give each and every one of us is financial independence and choice when we get to that stage of life. Unfortunately this is the bit that doesn't get very well covered in media and education. What we tend to read and hear about is 'the pension' or 'the ARF' (the products people are trying to sell us!) - we rarely hear about the finer details, and the details that will be the most significant when we get to that stage. I aim to arm you with the ideas and knowledge now so that you can achieve tangible results when you get there yourself and you are drawing an income from your ARF or other pension funds.

We will be looking at two core aspect to Retirement Income Planning; Withdrawal Rates, and Dynamic Spending Strategies. First up are Withdrawal Rates.

Paddy Delaney

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Investing in Bonds, particularly in retirement (or once we stop working full time!) is the norm. If you are a member of an Occupational Pension scheme or you have a mass-market pension fund you are more than likely signed-up to LifeStyling on your scheme. We covered it in Blog 53. What LifeStyling will do is move a large chunk of your pension or investment portfolio from Equities and into Bonds as you approach your 'normal retirement age'. Can be a good thing, can be a not-so-good-thing.

This week I aim to share a short piece outlining the key aspects of Bonds, how they work, what you need to know about them if investing in them, and how they can stand to benefit/hinder investors in the mature stages of their financial planning. We will focus on Bond funds, and Bond Index Funds specifically in this weeks' edition.

Paddy Delaney

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Welcome, and thanks for checking out Informed Decisions Blog. Over the past couple of weeks we have focused on managing finances in later life. Last week we explored the 2 options many of us have when we get to draw our retirement funds, Annuity or ARF.

Seeing as it currently accounts for the majority of retirement income strategies it will form a large part of coming weeks. We will be exploring how one can attempt to maximise the income one gets from an ARF. Make sure you stay till the end because we will also be exploring how you can aim to ensure that your ARF lasts at least as long as you do - and hopefully longer, potentially leaving a sizeable legacy to loved-ones.

This week we will now share insights on some really important aspects of Approved Retirement Funds (ARFs). I was being a little cheeky calling this 'what you should know about ARFs' but I do honestly believe these are the basics. I also believe that knowing these fundamentals will help, whether you already have an ARF, or will have one in the future.

We will determine how ARF-income is taxed, how it is handled on death, and explore how you can maximise the income you get from your ARF. This latter element is an entire science on it's own however I will intro the main aspects to consider.

Thanks,

Paddy Delaney

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Should I buy an Annuity or Approved Retirement Fund (ARF)? Unless we are retiring from a defined benefit (DB) pension scheme we will have this decision to make in regards how to access our pension benefits. Once we take out tax free lump sum we will have this decision to make with the balance. It is a big decision with multiple complexities involved, both financial and emotional.

Do I want the predictable route or do I want the less predictable but potentially more lucrative route? Do I want the peace of mind knowing that I'll get €x every month for the rest of my days, or do I want the potential to get more every month and potentially leave a legacy? Do I want a piggy-back down Everest or do I want to navigate it on my own two feet? That last sentence might seem odd but bear with me. Before I outline the considerations I believe we should make before deciding on annuity or ARF, I want to put this decision in a little context.

I was speaking at a recent 'Point of Retirement' event in Croke Park. As part of my piece I compared managing one's income in retirement to climbing and descending Everest. I made the comparison that when we are in 'accumulation' phase of building and preparing for leaving full-time work we are on the 'ascent' of the mountain. We reach the peak at the time we depart full time employment - however as anyone who has ever climbed a mountain will confirm - the descent is far from easy. One stumble and it could be damaging or indeed fatal. This is a much lesser risk when we are ascending, a fall or stumble has a much lesser probability of significantly screwing-up our accumulation plan.

While some could argue it is slightly dramatic, I do believe that managing our income in retirement is very similar to ascending and then descending Everest. Given the potential dangers, the impact of a stumble financially, and the significant importance of staying on track draws many comparisons. One of the attendees at the session sent me a link that very night, which was breaking news of the Irish climber who had unfortunately gone missing on the descent of Everest, only for another Irish climber to be confirmed dead a week later, again on the descent. It was obviously a pure (and really awful) coincidence but it surely hammered home the point about the dangers of descending, or in this situation, of navigating our 'spending phase'.

Paddy Delaney

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Welcome back to Informed Decisions with me, Paddy Delaney!

A couple of weeks ago I mentioned that the coming 'season' would be focused on how to prepare for and importantly, navigate our incomes in retirement. It's not that I am breaking a promise but this week I want to take a very slight diversion from that, for two very valid reasons a) an article I wrote was published int he Sunday Times this week, and b) I didn't allow myself sufficient time this week to complete the next piece as fully as I had hoped.....so you'll have to wait till next week for that one I'm afraid! Sorry!

It is not everyday that someone like you and I gets a full article published in one of the main weekend papers - and for someone that has been an admirer of these papers, and of the people who write articles in them, it was a big deal! So I'd love to share the article with you, in the hope that it is of value.

Before I do that I have an ask of you. I have been blogging and podcasting (or 'casting pods' as my mate Lenny calls it!) for 3 years now. I absolutely love writing and creating the Blog every week, get tons of feedback and emails from people, and indeed some of you have become hugely valued clients who I work with on an on-going basis.

During the 3 years I have had a strong desire to do more, to reach out and connect personally, to perhaps meet as part of a group or community of sorts. In my mind at least there is nothing more rewarding than spending time with people who are interested in similar things and sharing ideas, forming new relationships, and learning from each other.

With that in mind, if you are reading this in June or July of 2019, I would really love your thoughts on the following:

If I were to host a Personal Finance/Investing/Retirement conference, meeting or Webinar, would you be interested in attending? If so, have you any suggestions on the specific topics or aspects you feel would be of most value and importance to you?

I have some ideas on what I feel would be of value to people, and based on my own years as a facilitator and coach feel would be able to bring something of real value - the question in my mind however, would there be anyone else there apart from me!? So who better to ask than you, my supporters. Would love you thoughts, email me here with your thoughts.

Pause me, reflect on this, would you attend, and what topics or format would be of value to you? Let me know either way! Once you've that done have a read of the following Sunday Times article as of 2nd June 2019.

The Generation Game… click here to read full article.

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Financial Planning in Ireland is on the up. Based on my experience at least, Planning is what people really really want. They may NEED a product to help them achieve their plan, maybe. But they want a plan first and foremost. They want to know that they will be OK financially, that they can afford to do xyz, that they can graduate from full-time employ at x age, and any number of other personal money-dependent goals.

Sure, the actual planning can be hard work, can require work, time, thought, challenge, compromise, debate and decision-making. These activities can and will stir up all sorts of emotions; fear, hope, pain, love, excitement, regret, joy, the list goes on. It is the emotion that it creates is what I get a real kick from. Helping people to plan, and to witness these emotions is what I love most about the work that I do with individual clients. It was in a conversation last week with a client that the topic of inflation came up. It had been mentioned in the news recently, inflation has hit a 7 year high of 1.7%. This blog topic is one I have had on 'the list' for a very long time. It is a huge topic, and some may be disappointed at how short a piece this is, given it's significance, but I feel less is more on this topic - it is a simple concept, too often over-complicated.

Full Blog Here.

Paddy Delaney

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Inheritance tax planning is most certainly a balancing act, is fraught with concerns and challenges, and is one that I see individuals struggling with quite often. When you die you may want your estate to pass to your children or other loved-ones but them having to potentially pay a significant % of the estate in Inheritance Tax may reduce greatly the amount that goes to those you intended, and increase the amount that goes to Revenue. I often hear people say 'sure I won't be here to worry about how much tax they have to pay', and I fully accept that logic. I do however also know that many of us would prefer not to see a significant portion of our assets go to the Revenue due to a lack of planning or perhaps a little foresight.

This week on Ireland's #1 finance blog and podcast I will share some ideas that I hope will help anyone that is struggling with this particular conundrum, or indeed may have this conundrum but doesn't yet realise it! I do hope you find it an excellent guide in the main aspects of inheritance tax planning, and I would also caution that everyone's scenario is obviously different, and what might work for one person may not be the optimum route for someone else, so please do bear that in mind as you digest this!

Paddy Delaney

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ARFs, AMRFs, AVCs, Annuities all form part of retirement planning, but as usual there's far more to it than products! Welcome back to Informed Decisions Finance Blog.

As part of my own motive to share information and to help others with their financial education I am a volunteer representative of the CCPC (State body that aims to help consumers, check out their website - tons of useful resources). I was delivering a talk to a large group last week in Dundalk, at the end of which we have time for Q&A. What struck me was that most of the questions relate to retirement planning, and indeed how to ensure that the planning we do is effective and of value to us when we get to the 'spending' phase after retirement. What also struck me is that in the past I have typically varied our topics, jumping from beginning to invest, to managing existing investments, regular savings, borrowings, mindset, education etc.

Based on feedback and also based on this recent experience the Blog will take a fairly heavy retirement-planning and indeed income-planning slant over the coming weeks at least. Having said that I hope to share ideas that are as relevant to those that are in 'accumulation' phase (mid-career) as much as it does to those that are in the 'spending' phase (retired or close to it!).

Intro:

I was talking to a friend of the family a few weeks back, recently retired and full of energy. This lady loves life, has a huge network of friends and family and is looking forward to hopefully many years of good times! When she asked me 'what are you doing these days' and I proceeded to tell her, she informed me that she has only 1 major regret, that she didn't plan a little better financially for her retirement. She doesn't have as much income as she would like in order to do the stuff she would like. It got me to thinking, about my own situation, and indeed of the situations of many people that I have come across over the years who have one eye on their graduation from full-time employment to a more leisure-based lifestyle!

We all obviously have differing circumstances and different opportunities and constraints however there are at least 5 pretty common mistakes I have seen happen again and again. Here I share the culmination of those thoughts, into '5 common retirement planning mistakes', in the hope that they might be of value to you, or indeed to your loved-ones.

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you can enjoy in years to come......so buckle in!

Intro:

It's been mentioned to me a handful of times that the topics of the Blog tend to be focused on the 'upper end' of things, and that for most 'ordinary people' the figures I talk about here are out of reach. To be fair the figures I sometimes talk about are aspirational, I get that. At the same time I fell that irrespective of the level you are aiming for the principles are the same, the ideas are the same. So whether the figures are 2x or 5x what you are aiming for, go with it and hopefully you'll gain some insights that'll help you get to where you want to get. Also, we gotta surely aim big....or as a friend of mine says 'keep your eyes on the stars and your feet on the ground'!

I covered 'can a couple retire with €1m' last year, and this week I will explore how to actually get to that level of a pension pot! In this relatively short piece I will explore the impact of different ages and different strategies in retirement planning, and we'll see how they each impact. The strategies differ in regards the duration of 'accumulation phase', asset allocation and fee structure.....

Paddy Delaney

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Welcome back!

Many of us have heard of FIRE (Financial Independence - Retire Early) but not many of us have met many that are actually doing it! In this episode we chat with Michael to hear his story, how he is working on his own financial independence, and the vehicles he is using to maximise his own financial future.

Michael stresses that his approach works for him, and that everyone should find their own way based on what they feel will work for them, so please don't replicate what he does without determining the risks and the suitability to you first.

Michael's website is here, and we hope you enjoy the interview.

Paddy.

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Hi, and welcome to Ireland's #1 Finance Blog & 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 & 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.

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This week I share a short (but hopefully valuable) piece to raise awareness of something that impacts us all and how we make decisions, and often without us even being aware of it!

What Are Biases?

If you were shown a photo of 2 different people, based on their appearance, dress, facial expression, ethnicity, and any number of other visuals, we would have our own 'impression' of that person. In essence, though we might not like to admit it, we have made a judgement about that person based on what we see, but more significantly, based on our biases.

Biases, which we all possess by the way, can cause us to be unintentionally prejudicial, and are formed over decades of experiences, beliefs, perceptions, information and thought. Our biases can have a positive, negative or neutral impact on our experiences and decisions.

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Paddy Delaney

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This week I share a short (but hopefully valuable) piece to raise awareness of something that impacts us all and how we make decisions, and often without us even being aware of it!

What Are Biases?

Full Blog Here

Paddy Delaney

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This week I share a short (but hopefully valuable) piece to raise awareness of something that impacts us all and how we make decisions, and often without us even being aware of it!

What Are Biases?

Full Blog Here

Paddy Delaney

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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.

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Paddy.

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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 & such' and 'best investments in such & 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!

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Paddy Delaney

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Investors are said to achieve far less in returns than the markets in which they invest. How is that possible you may ask? Typically it is down to investor behaviour. Investors get blamed for doing silly things when it comes to investing, however my take is that it is the financial professionals who must shoulder the responsibility for it.

This is not to suggest that the advisors/planners that might assist investors have total control over what an investor does, but I do believe that if an investor is engaging with an advisor/planner that that professional has a duty of care to let that investor know how investments have worked since 'time began'. Without this knowledge then it is only utterly natural that an investor will succumb to fear and do something irreversibly costly which will have a lasting negative impact on their future.

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Paddy Delaney

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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?'

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Hope all is well?! Last week we shared some ideas on the best way to accumulate €1m, and whether a deposit regular savings account or a pension route might be the most effective way of doing it. We analysed these two routes and factored in deposit rates, pension fund returns, fees and charges and various tax rates that apply to both and how they will impact on the end result. As always, it pays to begin with the end in mind! This week I hope to share ideas on how to select a suitable investment fund, how to avoid common mistakes, and how to deal with the consequences of funds not performing as you may have hoped.

If you have read or listened to last weeks' episode you will recall that based on realistic assumptions that the pension route would stand to be in the region of €400,000 more effective than a deposit account! A large portion of this net euro benefit was as a result of the tax reliefs (currently) available to 'Sam' on the contributions made to a pension. The remainder of the net euro benefit came from the average annual return that the pension delivered to 'Sam'. I received a lot of emails from individuals on that last episode, some expressing surprise and some seeking further information. One of the questions that was put to me was, 'Well what if the fund I am in does not deliver the 6% return, or indeed if it is negative returns for a long period of time'. In my experience at least this is a very real concern that many have, and feel quite uncertain about it, so lets explore.

Thanks for listening,

Paddy Delaney QFA RPA APA

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Should I invest in a pension or save money in a bank account!?

Last week I shared some ideas about the value (or potential lack thereof) in having a pension of 'average' size. The reaction to that piece was really quite interesting; it seemed to have surprised some people! There is no question that €100,000 is a lot of money, no matter what way you slice it however having that in a pension fund at the point of retirement leaves one with, to be fair, quite limited options to access a meaningful withdrawal income. In last weeks' piece I referred to a previous blog we shared about the value of amassing a pension pot of €1m, and the considerable options that offers one at retirement. That got me thinking and so this week I take a hearty stab at comparing the merits of saving into a regular deposit savings account, or into a pension if one was aiming for a lump sum of €1m! We will explore which of these in this 2-horse race, in Net terms stands to offer you the best possible chance of success. This is not something that I have never seen done before, maybe there's a reason for that.....let's see!

Paddy Delaney

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The title of this piece may seem overly alarmist, however it is my firm belief that most pensions that people here in Ireland have are really ineffective and the investors would quite possibly be better off doing something else with their funds. Are pensions useful? Absolutely they can be hugely useful (read here for 1 example!) however if they are entered into in a half-baked way they can be pretty useless, and unfortunately I have seen it far too many times.

We all see lots of articles and blogs and media mentions of not enough people having pensions etc etc, however it is also true that getting a pension just for the sake of it is not necessarily the right solution. In this article I hope to share insights which will potentially help you avoid getting into something that is of no value nor use to you, and give you a good chance of getting into something that stands a strong probability of being of real value to you.

What Is The Average Pension or Retirement Income In Ireland?

It really depends on what survey or research you are relying on but I have seen various figures quoted. Some say that the average pension pot for those retiring is €60,000 and other 'research' that puts that figure at €90,000. Either way I am not sure how those figures are arrived at, but my experience would suggest that for those that have pensions it may indeed be an average of that sort of level. Some have pension pots of €20,000 and others have pension pots of €1m or more, so it varies greatly! Depending on the size of the pot, the level of volatility you are exposed to and the number of years over which you intend to draw that income, you'll have a varied retirement income available to you.

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Paddy Delaney.

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'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.

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Paddy Delaney QFA RPA APA Coach

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Welcome back to the new home of Personal Finance in Ireland, where we share insights which we hope help you to avoid mistakes and achieve the results you seek. All we ask in return for sharing these ideas is to tell a friend, and use the ideas with the intention in which they are shared, thanks!

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The title of this week's blog is a little vague or possibly might appear abstract, granted, but I do believe that it's contents will help people to see the light! To help explain, I was speaking to an advisor recently who I was helping to connect with and recognise the real value she can bring to her clients. She is an experienced advisor who is trying to transition from an old-school sales-person to operate in a more transparent and client-focused way. As you know I am all about the transparency and the client-focused side of things so I was more than happy to play a small part in helping her make this transition.

Anyway, we were chatting about investments and recent volatility, I passing the recent volatility off as 'par for the course' while she was very much seeing it as a distraction and bordering on something to be fearful of as an investor. At that point I mentioned something like 'but sure it's only down in the region of 15%, that happens every year on average, and it's the very thing that rewards those who stay invested'. She looked at me as if I had two rock-filled heads. She stated that there is no way that global equities have declines of that amount every year, even on average.........and that is where she was very much ill-informed, and where I guess the vast majority of us are also ill-informed. Let's fix that!

J.P Morgan Guide To The Markets

I have mentioned this beauty of a quarterly document before here, and I wish to re-iterate that (as far as I am concerned) it is one of the most easily digestible and insightful economic/investment/macro reflections available anywhere, at absolutely no cost. Click here to get the December edition. So in my conversation with the advisor I was working with I referred to this nugget. Page 14, to me, is essential reading for anyone that is ever contemplating investing in any form of decent equity portfolio. Irrespective of the fact that this chart, as you'll see below, is a reflection on the top 500 Companies in the USA only (S&P 500 Index), summarises what long term investing is about, and indeed portrays the great contradictions of equity investing, you face temporary declines but always win over the long term!

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Welcome to Informed Decisions, Ireland's #1 Personal Finance Blog & Podcast! Hope you managed to catch last weeks' Podcast with Andy Agathangelou, all about developing more transparency in Financial Services, it was a decent chat!

This week I am on a mission to shred some myths about that big question: Should I take my benefits out of my Defined Benefit pension scheme, or leave my benefits in my Defined Benefit pension scheme. Granted it is not a question that everyone of us will need to answer over a life-time but it is one that I see more and more in recent times. In addition to that it is a decision which can potentially have such a significant impact on one's future lifestyle and financial well-being that it deserves a closer inspection! Given that in the region of 60% of people who have a Defined Benefit scheme have left that employment and so will typically have the option to leave if they want. We're gonna try help them understand whether that's a wise move or not!

Before we begin I have to declare a bit of a bias I have on this topic......I firmly believe that generally speaking a Defined Benefit scheme is a hugely valuable benefit to hold onto for dear life, that you'd have rocks in your head to leave it, that it represents better value than you could possibly hope to achieve if you transferred your benefits out of it, that it will sustain you in retirement, and go a long way potentially to sustaining your partner if they survive you, that thousands of others would give their left and/or right arm to have the preserved benefit that you have, and that it is usually a case that your advisor may be steering you to leave because it will benefit them more than if you stay......but hey I could be totally and utterly misplaced in my bias. I'm just outlining that I do have a bias, and a belief that in most circumstances you'd want to have rocks in your head to take a transfer! Let's see if I'm way off or way on....

What Is A Defined Benefit Pension?

In simple terms a Defined Benefit pension scheme is one in which you are 'guaranteed' a certain level of income in retirement, based on your salary at time of leaving employment, and the number of years you were a member of that scheme. Traditionally they have been the Rolls-Royce of pensions, offering great security, value and certainty of income to retiring employees. In recent years their reputation has been tainted with swathes of employers 'closing' their DB schemes, due for no other reason than they are hugely expensive for employers to provide. Defined Contribution schemes, where the employer will make a certain payment each month on your behalf are far more manageable for employers, and usually less effective for retiring employees.

When Can I Take A Transfer Value From My Defined Benefit Scheme?

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Paddy

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Hi and welcome to Ireland's dedicated Financial Planning and Personal Finance Podcast. We are on a mission to share ideas and unbiased insights that might help you make beneficial decisions.

Speaking of mission we are joined this week by non-other than Andy Agathangelou who founded the Transparency Task Force and which is on a mission to have a positive and lasting difference on financial services and on those that it exists to serve.

I was so taken by Andy and the band of volunteers that have joined him that I have accepted the invitation to become Ireland's first (and so far only!) Ambassador. It is my intent to help have a positive difference on this mighty profession so that it can survive, serve and help many more thousands in the years ahead.

Thanks for listening!

Paddy Delaney

QFA |RPA | APA | Qualified Coach

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Hey there and welcome back to Ireland's #1 personal finance blog. This week we are exploring what is quite a common challenge for people, the decisions about investing a lump sum now or waiting for markets to fall or crash. Funnily this is not usually a challenge for would-be investors when markets are calm and rising. It more often becomes a challenge when market volatility hits, or when media is claiming that the market it 'over-priced' or at an 'all-time high'.

The Impact Of Time

In considering this it obviously makes sense to consider what the intent is with investing. When doing a presentation last week for a group of advisors I asked them what the main purpose of investing is, 50% of the room said it is to beat inflation, while the other 50% of the room said it was to achieve decent growth. If you are considering an investment perhaps it is worth considering what your intent is with that investment. I firmly believe that unless there is a clear goal or plan for the funds then you are much more likely to make decisions that would be detrimental to your long term investment success. We can never obviously predict what the future holds for markets, and that history may well not repeat itself, but history (and the constant upward curve!) are all that we have to go on.

One piece of data I particularly like relates to the impact of time in the market, as opposed to timing. It analyses the Standard & Poors 500 (S&P500) between 1926 and 2011, and determines what percentage of rolling periods had positive returns, for various durations in that market.

1 Year - 73% of rolling periods positive (752 of 1021 rolling periods)

5 Years - 86% of periods positive (844 of 973)

10 Years - 94% of periods positive (860 of 913)

15 Years - 99.7% (851 of 853)

20 Years - 100% of periods positive!

These numbers basically speak for themselves here but to quickly look at both ends, 1 year and 20 year periods. We can see clearly that we stood a fairly decent likelihood of our investment being in positive territory after 12 months, but certainty of positive returns if we had invested for a 20 year period. Not everyone will have a 20 year window over which to invest but there is no denying that it clearly demonstrates the old and over-used mantra of 'its not about timing the market, rather time IN the market'!

Read the full Blog here.

Paddy Delaney QFA | RPA | APA | Coach

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Hey there, it's great to be back after a few weeks of rest over the Christmas, it was probably good for all of us to have a break from listening to me! Anyway, very excited about developing what we are doing here, growing the community, and helping more people get the information they need to make good financial decisions for themselves. On reflection over the Christmas I am more keen than ever to keep trying to make a positive difference and to keep telling it like it is! Ever wondered how to get financial advice in Ireland?? This week in our first episode of 2019 I want to outline the options open to people who are perhaps hoping to get their financial lives sorted or who have some big financial decisions to make. Looking for financial advice in Ireland can be confusing; who to trust, how they can help, what they can do or can't do and what do they charge? Here I hope to outline the various options clearly, outline some of the possible pros and cons of each, and ultimately share some ideas that might help....I hope it is useful. If you haven't seen it then I suggest reading Blog 27 where I share ideas on what to consider prior to getting advice.

Where Should I Get Financial Advice?

This is a question that many who have had financial decisions to make have considered, some may have had an obvious answer and others less so. My intent with this episode is to outline the various options and help in your decision, if you have one to make. The answer to that question really revolves around the outcome you seek and the manner in which your advisor operates. For some people the way that your advisor works will be important, they will want to know how they are paid and what potential conflicts might be present in their advice. Others will not care one way or the other provided they get what they need in place.

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Welcome back to Ireland's award-winning & independent Financial Planning blog and podcast. We are on a mission to share ideas and educate people to avoid mistakes and make decisions that will benefit them in the future. Drop me an email here with any of your ideas or feedback on making the site/podcast better, would love to hear from you.

For a while now I have been really keen to get a 'non-advisor' to tell us what has changed in recent years in the UK in the financial advice arena, and how that has impacted consumers like you and I. The reason I have been keen to get speaking to a non-advisor is because advisors can have tainted views of things particularly when it comes to regulatory change etc, understandably they don't always like it!

Rory Percival is the person for the job here, as a former FCA regulator and now running a Consultancy and speaking business that helps advice firms to stay abreast of regulatory change, there aren't too many others as well placed to share some insight with us.

We have a fairly broad-ranging conversation covering some questions like:

What has changed in recent years in financial services and advice?

What lessons can we learn about transferring defined benefit pension scheme?

How are people protected when it comes to seeking advice and is that advice up to scratch?

Should I transfer out of my defined benefit scheme, and if so what should I look out for?

What are investment platforms and can they be trusted?

Be sure to listen to the end where Rory shares his top tips for people in how to best manage income in retirement, and ensure that they have the best chanve of maintaining lifestyle in retirement.

Have a hugely Merry Christmas and see you in 2019!

Paddy Delaney

QFA RPA APA Coach

Links:

Rory Percival site

Rory's guide to Defined Benefit Pension Transfers (UK)

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Welcome back to Ireland's independent & award winning Financial Planning Blog & Podcast. We don't claim to be perfect but we have been creating and sharing ideas here on the podcast for the past 2 years and are on a mission to help people of Ireland (& beyond!) to make decisions which benefit them in the long-run. All we ask is that if you like what we are doing that you'd tell a friend or loved-one about us and see if it can be of any use to them!

Speaking of long-run we are hugely grateful for your ongoing support, readership and listenership, if the few thousand of you who listen every month didn't do so we wouldn't still be producing the show, so thanks for that, we love it! I know I say 'we' but it is really only me, but for some reason it seems right to me! Maybe we will be a we in future! Last week we tackled Entrepreneur Relief, and had some interesting emails from some entrepreneurs who have learned a thing or two as a result, which is cool!

This week I have to vent a little, not for my own good but as a bit of a warning or war-cry for us all. It is pretty disappointing that people still need to be warned about what I am talking about today but it is a fact, and an important one at that. What I am talking about is a charging structure that I witnessed on a retail savings product recently, that was being promoted on a state-funded website by an 'advisor' with national media coverage. It also ties-in with my announcing that I have recently become Ireland's first Ambassador for the Transparency Task-Force. This is a voluntary group/movement based in several countries, with a few hundred members, and a dozen or so ambassadors. As the title suggests they exist in order to encourage more transparency and improved provision of information in financial services industry. I hope to interview the founder Andy Agethangelou in January so we'll have more for you in a few weeks!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome back to Ireland's award winning & independent financial planning blog & podcast, where we are on a mission to share ideas and information that hopefully helps you make decisions that delivers long term results for you. Thanks for the lovely reaction to last weeks' episode, I certainly enjoyed sharing the story! This weeks' topic is kinda closely related to the oul' lizard-brain and relates to entrepreneurship!

We are not tax experts but it has been asked of us a few times recently so this week we will share a wee bit of info about how 'entrepreneurs' can stand to benefit from a pretty significant chunk of relief......of the financial sort.

A Short Story:

Maria Dalmation set up a dog grooming company back in 2010, called 'I Shitzu-Not' Limited (I don't think I'll ever make it in advertising!). Anyway, she had a steady start, and then when she won a national dog-grooming title for her grooming skills her business took off. For the 4 years from 2013 to 2017 she had revenues each year in the region of €200,000, business expenses including wages of €100,000 meaning she had profits of €100,000 per year. She did pay corporation tax at 12.5% on the money in the business each year however the company had cash of €550,000 in it's bank account at the end of 2017.

Maria Dalmation had an epiphany in January of this year, she wanted to leave the grooming business, it was time for a new adventure, to pursue her love of discovering and documenting Mongolian Cave Art (please understand I had to make this really random so as to avoid the chances of anyone coming forward to claim I was talking about them!). So she sought to leave it all behind, and sell the business to a colleague that had been working with her for the past few years.

Maria's business at that stage was worth €750,000 (including cash and goodwill), she sells it for €750,000 and pays a measly €75,000 Capital Gains Tax on that sale of her shares in the business. She pocketed, perfectly legitimately and appropriately, €675,000 of the €750,000 sale price. To put that in context had she sold an investment, property or other asset other than a limited company on which she had the same gains she would have paid Capital Gains Tax at 33%, equating to €247,000, meaning she would have pocketed €500,000. A simple thing now called 'Entrepreneur Relief' has reduced her tax liability on disposal of her business by €175,000.

Continued.........

Paddy Delaney

QFA | RPA | APA | Coach

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Welcome back to Ireland's award-winning Finance Blog where we are on a mission to share ideas that will have a lasting and positive impact for you. This week were are sharing something a little different, and hope that it hits the mark, that it perhaps gets you thinking and perhaps even encourages you to do something you want to do! It is bigger than personal finance or financial planning, this is about you and your life!

In November each year, for the past 6 years anyway, there has been an 'unconference' called Congregation happening in the small and lovely village of Cong in Mayo. It was created by and organised each year by one man, a guy by the name of Eoin Kennedy, who is a digital communicator, entrepreneur, trainer and all round good guy it seems! Not sure where he got the idea but he gets 80-100 people to Cong every year, from a hugely diverse range of backgrounds to present their thoughts, ideas and debate on various different topics. Unlike a typical conference where you sit and listen to a speaker Congregation revolved around the principal that everyone in attendance presents a piece during the day, and then the groups have an opportunity to discuss what was just said, share their views and get lots of different input from lots of different people. I always find it hard to explain it, indeed I was total at a loss when it was first explained to me by Alan O'Rourke from Bettystown who is a speaker, lecturer, marketer & writer.

Anyway, unlike a typical conference you can't buy a ticket, you can only gain entry by submitting your thoughts on the given topic each year. This year it was 'ideas' so in order to get a spot you had to write, record, create a short piece about 'ideas', and then prepare to pitch that to the group on the day. Sounds daunting to some but this is the most familial, non-threatening and open gathering of interesting and smart people I have had the pleasure of attending in my 38 years! It is an eclectic mix of all-sorts; writers, CEO's, farmers, coaches, teachers, entrepreneurs, educators, inventors, makers, doers and dreamers, and all in it to share ideas and hear from other interested folks, where would you get it!

Thanks For Listening,

Paddy Delaney

QFA |RPA | APA | Qualified Coach

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It was in conversation with a friend recently, who has just started working for a new company, that I was asked if I believed it makes any sense to join a pension scheme offered by an employer. He was told that if he put 4% of gross salary into his pension that the employer would put 6% in, totaling 10% of his gross salary. This seems like a reasonable offer from the employer in this Defined Contribution scheme however he had concerns which he shared with me!

Having done a little of his own research he had concerns about the fees that he had read of, concerns about the fact that 'you could get back less than you invest', and the mystery about how one goes about taking the money out at the end. These 3 very real and very common questions and concerns lead to, I guess, many people not engaging with pension, and without answers to those questions I wouldn't blame them for a second!

Welcome to Ireland's double-award-winning Finance Blog and Podcast where we are on a mission to help readers and listeners make decisions which benefit them now and into the future. We thank you for reading and the greatest compliment you can pay us is to tell a friend about us, or drop me a mail here with any ideas or suggestions that would make this site as useful as possible.

In trying to answer the question 'should I join my company's pension scheme or not' it might be worth taking each of the 3 questions, not with a view to finding an answer in the affirmative but a considered and credible answer!

Paddy Delaney

QFA | RPA | APA | Executive Coach

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BlackRock Investment Managers conduct an annual piece of research (in the US) of around 30,000 individuals and get their sentiment and preparation for retirement. Obviously it is heavily slanted to the financial. One of the surprising things, for me at least, was that the #1 concern for the majority of respondents was not health or social interactions or purpose, it was 'running out of money'.

I guess running out of money in retirement does bring up all sorts of miserable and unfortunate images in our minds, and that is probably enough of a motivation for us to want to do something about it! Sequence risk is something that can result in us running out of money, and which we covered in a little detail last week, and this week we aim to share some ideas in how to minimise the impact of that very occurrence.

Welcome back to Ireland's double-award winning Blog & Podcast. On a mission to share ideas which will help you both now and into the future. The biggest compliment you can pay us is to tell a friend about us and/or drop me an email here with any ideas, suggestions or feedback.

Thanks,

Paddy Delaney

QFA | RPA | APA | Executive Coach

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We are not talking about death here today, but we will be looking at a thing called Sequence Risk which in my book is one of the most unknown and under-rated influences on your income in retirement. I would go so far as to say that it can have much more of an influence on your retirement lifestyle than the amount that you actually have at the beginning of your graduation out of full-time employment.

Plain and simple this is one of the biggest factors affecting people's incomes in retirement. Essentially this is the very real risk of the order of investment returns you achieve being unfavourable. We will show you how big an impact this has on a portfolio, why you should know about it and begin to explain the very real impact it can have on the legacy that you leave your loved-ones.

Welcome to Ireland's only dedicated and straight-talking personal finance and financial planning Blog. We are on a long term mission to share ideas and raise awareness about topics that impact us all and which will hopefully be a positive benefit for you into the future. Please drop me a mail here with any ideas, suggestions or feedback which would help make this resource as useful as possible.

Thanks for listening,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland’s only dedicated and straight-talking Personal Finance & Financial Planning Podcast. Delighted you have decided to have a look at this weeks’ episode. Firstly, want to say a heart-felt thank you to all listeners of the Podcast and readers of the Blog for their encouragement and feedback over the past 2 years, we picked up the title of ‘Ireland’s Best Finance Blog’ at the Irish Blog Awards last week in Dublin, totally surprised to win it for the 2nd year in a row, particularly against such top-drawer blogs as the Zurich, Bank Of Ireland, Taxback.com to name just a few. I’m a big believer is not focusing on the past too much, whether it is a high or a low, o lets get stuck in to this weeks’ episode!

We are joined in conversation by Derek Bell, the Chief Exec of the Retirement Planning Council of Ireland, which is based in Dublin. While it might sound a little like just another pensions company they are actually anything but. They provide, what to me sounds like, an invaluable service to people who are on the verge of retiring from their jobs here in Ireland. They run courses which help people to consider all they need to consider in advance of ‘graduating’ from their full-time permanent positions…….and to head off into the sun-set.

Derek shares with us in this 30 minute or so Podcast what he believes are some of the main aspects which people often overlook when considering retirement, and the funny thing a lot of those aren’t the financial, which makes it all the more interesting to hear and consider.

And be sure to listen through to the end where Derek shares the single biggest piece of advice he believes will impact on anyone who is preparing to retire, be that 40 years or 40 days away…….enjoy!!

Oh, be sure to drop me a mail here with your ideas, suggestions or feedback on how to make the Podcast/Blog as effective and useful as it can be, please!

Cheers,

Paddy Delaney

QFA | RPA | APA | Coach

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'I'm not a procrastinator, I just prefer doing everything in a dead-line induced panic!'......Honest words shared with me by an acquaintance recently. And to be fair it totally struck a chord with me, as a former repeat procrastinator it sounded so accurate a description of the logic a procrastinator uses to rationalise their behaviour (or lack thereof). It is only when the pressure is on, the procrastinator will them him or herself, that I am at my best....so there really is no point in that particular item until such time as it is time-sensitive or urgent! We did touch on the subject previously and shared a story about a granny and €8k! We are not now here to criticise or condemn that approach, rather to try and understand why it is a default for so many of us in lots of aspects of our lives, and not just financial planning & money aspects.

Welcome back to Ireland's only dedicated Financial Planning Blog & Podcast, we're on a mission to share ideas and help you make decisions about your money that will benefit you now and into the future. We love to hear from readers and listeners to the podcast, and invite you to drop us an email here with suggestions, ideas or feedback.......thanks!

It is said that the avoidance of a task, postponing until tomorrow what can (and often should) be done today, is one of the main obstacles to us achieving success in our professional and personal lives. Think about that, how many times has an idea, a picture of a desired outcome, a goal or a wish entered your head, and for you to talk yourself out of it, for whatever reason? This is procrastination at work, and it nigh-on constantly prevents many of us from doing stuff that we want to do!

Read Full Blog Here.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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In 2016 The Natural Environment Research Council in the UK invited the public to name their latest scientific research vessel, which was costing £200m. This vessel was going to be doing (and currently is doing) really insightful and exploratory work, making new discoveries and so on. Really important, noble and global research for the good of the natural world. In the initial stages the likely suggested winner was names such as 'Endeavour' and 'Poseidon' etc. Which made sense. However you can imagine the consternation internally when the public unanimously got behind a viral idea of calling it something rather ridiculous, yet pretty hilarious at the same time. And so it was that the winning vote, by some margin, was ‘HSS Boaty McBoat-Face’!

In the past week we saw the 2019 Budget being released, and depending on your level of interest you may have either read every single iota of info in it, listened-out for any major bits that will impact you, or paid no heed to it at all. Each to their own. For me at least, The Budget is one of these things that happens every year (as far as I'm aware) and which the media latch onto and utilise to create a good week's worth of material and supplements and 'special reports' etc. But for many of us, The Budget is something that largely happens in the background, and has little impact on our overall financial lives or indeed financial planning. For many the drama of the Finance Minister somberly walking onto the steps of the Dail with his or her brief-case looking all serious is all a bit much, it is over-dramatising a budgetary process that any prudent government in any nation attempts to do in a way that ensures it’s financial stability. Between the media and the incumbent government they try and whip us up into a state of frenzy about the Budget…..perhaps so that we’ll notice them and think more of them, I’m not clear on the motive to be honest, as it seems they use the same of hype whether it is a give-away’ or a ‘tightening’ Budget!

I’m not suggesting we change the name from ‘The Budget’ to Budgety McBudget-Face’ but I am inviting us to look at it in less of a reactive ‘Oh-my-God-look-at-what-they-are-doing-to-us’ sort of way, and in more of a pragmatic and proactive manner. So this week we are going to share a bit of a budget update, and invite you to observe how significant (or otherwise) it might be to you individually, particularly if you are in the process of either building and maintaining your wealth over the long term.

The Update Bit:

The budget didn’t carry too many shockers in fairness, while it was being reported as an ‘election-friendly’ budget you’ll see from our highlight reel here that there was nothing overly generous or prohibitive in it. Here’s our ‘Super 7’ list of Budget Updates:

Standard rate income tax band increased by €750 from 2019 onwards
Self Employed & Directors increased by €200 to €1,350 from 2019
Some tweaks to the lower USC bands and rates
DIRT tax reduced to 35% - Exit Tax remains unchanged at 41%
€5 increase to State Pensions per week, from March 2019
Capital Acquisitions Tax (Class A) increased by €10,000
Mortgage Interest relief against rental income increases to 100% from 2019

Read on here.

Paddy Delaney QF| RPA | APA | Qualified Coach

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If you have ever invested money in a fund or collective fund with a 3rd party, either through a pension or through an investment structure (product or platform) you will most likely have already completed a 'Risk Questionnaire' or 'Risk Survey'. It may have formed part of the bigger conversation about your investment goals, or it may have been the sole basis on which you made your investment decision. If it was the latter than there may be cause for some concern.

Welcome to Ireland's only dedicated and straight-talking Personal Finance Blog & Podcast, and thanks for reading! If you want to gain some insights about money, hear from some super guests and to help yourself to make financial decisions which benefit you, then you are in the right place! We are always keen to hear from readers so please do send me a mail with any ideas, suggestions or feedback, you can mail me here.

The Conflict:

If an individual seeks financial guidance they generally do so in good faith that the person they seek it from will have their best interests at heart. In a recent interview with Eric Brotman we explored what the term Fiduciary meant, and it means. In essence it relates to the relationship between a financial advisor and a client as being one established on trust, and where the advisor is bound by a responsibility to act in the best interests of a client. That is to say that they place the client's interests before their own......which for many people in Ireland will seem like a strange idea.

When we seek any help, whether it is to buy a car, have some domestic appliance fixed, book a holiday, visit a physio, hire a painter, as a nation we expect that the person(s) providing the product or service to be acting in their best interests and will perhaps try to sell us or charge us more than may perhaps be strictly necessary.....it is a cultural thing, perhaps in every corner of the globe.

To suggest then that a 'financial advisor' would not act in their own best interests, to act in a fiduciary manner, seems almost alien, and totally counter-intuitive! Yet this is a formal means of working for a small yet growing population of financial services professionals in the US. I, for one, am looking forward to the growth of such a population in Ireland....perhaps it starts right here.

Need Versus Wants:

You are perhaps wondering what any of this has to do with Risk Questionnaires, thanks for bearing with me. Lets image a scenario where you are a 60 year old with €250,000 sitting in deposit accounts but who now needs to generate an income of €15,000 per year (6% of fund) from your investment in order to pay for the lifestyle you maintain. In addition you want to have that income increase in line with inflation each year, your circumstances demand it.........Listen to hear more!

Or check out our Blog here.

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Are you swimming in the nip dear reader?

This week we share some ideas with you about a what the State Pension looks like currently, how much we might get, how we go about qualifying for it, and how the level of income we have from 'guaranteed sources' when we do retire determines how we can access other retirement funds we have set for ourselves.......so a nice simple one!!

Welcome to Ireland's only dedicated and straight-talking Financial Planning and Personal Finance Blog & Podcast. We are on a mission to share insights and to help people to help themselves. In return if you feel it is of value to you then please do tell a friend! We'd love to hear from you with any feedback, suggestions or questions, drop me a mail here.

This week we help answer the following questions.....

How Much Is The State Contributory Pension Right Now (at time of writing!)

What Age Can I Get The State Pension?

How Do I Qualify For Contributory State Pension?

How Much PRSI Need I Pay To Qualify?

Why It's Not Enough?

Hope you enjoy...

Thanks for listening!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we are finally getting round to a topic that has been on 'the list' for quite a while. One of the main benefits of pensions that 'the industry' of financial services harks on about a lot is the tax relief that is available on contributions, and that is certainly true. Having said that what is not true is that pensions are the only tax effective vehicle in which to invest in this fine country of ours, there is also (among a handful of others) the Employment and Investment Incentive Scheme as declared by the Revenue. This is the artist formerly known as Business Expansion Scheme (BES)!

We will now share the ins-and-outs of this scheme, the pros & cons and hopefully a few examples which will show how an investor (with a lump sum) might aim to reduce his or her income tax bill by investing in such a thing. Like night becomes day the rules around this Scheme can change in future but they are a reflection of things as they stand today!

As is customary I would like to welcome you to Ireland's only dedicated and straight-talking Financial Planning blog & podcast! We are on a mission to change how financial advice is done in Ireland and to help people help themselves to make decisions which will benefit them in the future. Love to hear from readers and listeners so drop me a mail here with any ideas, suggestions or questions you have and I'll be sure to reply post-haste!

Oh, regular readers might recall that we won Best Finance Blog in Ireland last year, we are short-listed again this year and the awards are on 25th October......it might be a case of 'difficult 2nd album' but sure we'll see how we go......It's not about winning it's about taking part and all that!

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Charles Dickens' novel about Dr. Manette, his 18 year incarceration in Paris and subsequent relocation to London to spend time with his daughter Lucie, and all the messing that apparently ensued is meant to be quite a read. I haven't managed it myself but am reliably informed that I should. Some day I will, as soon as I have read every investment and retirement planning book in existence! A Tale of 2 Cities was set against the back-drop of the run-up to the French Revolution and one could potentially say that there may be a revolution ahead in terms of investing in Ireland, there is a groundswell building around the inconsistencies in how investments are taxed and the access to various investment options. This week we explore the tax implications of investing in 2 different vehicles in Ireland, what tax an investor will pay, and the net impact that that means over the term of an investment. It's an investment tale of 2 cities as such......I know, a very tenuous link indeed!

Welcome to Ireland's only dedicated Financial Planning Blog & Podcast, on a mission to make a positive difference in how people like you & I manage their finances and make decisions. Your input and feedback are of real importance to us so would be delighted if you were to drop us a mail with any such ideas or feedback you have here.

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we are joined in conversation with Eric Brotman from US-advisory form Brotman Financial. Eric shares with us many ideas and helps answer many questions including:

How best to prepare for 'graduating into retirement'?

What is Fiduciary Advice and how does it differ to other types of financial advice?

Should I invest a lump sum or clear my Mortgage?

He also tells us a little about the challenges faced in the US with the infamous 'student loans' situation, which if nothing else might make you feel a little better about your own situation!

Thanks for checking it out......

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we are hoping to answer several questions we have had from listeners in the past 6 weeks or so. It has been put to me that it would be valuable to share our thoughts and to explore whether it would be more beneficial to invest in a low-cost investment plan, achieve a decent level of return and pay whatever tax is due on withdrawal, or to invest into a pension, achieve the same level of return, pay what tax is due on withdrawal.......on the face of it, to me at least, it seems there will be no competition, but you know what they say about assumptions (My favourite quote about assumptions is...... 'Don't Make Assumptions'!)

Welcome to Ireland's only dedicated and straight-talking Personal Finance & Financial Planning Blog. We are on a mission to make a positive difference and to help people take control of their finances in a meaningful way. If you have a suggestion, question or feedback for us please do drop me a mail here, love to hear from readers. Oh, and one more thing, we are trying to make a difference, so if you feel anything you hear or read on this site might be useful to a friend please do send them a link......they might even thank you for it!

Invest or Pension......?

To be frank when I sat to do this analysis I wasn't sure where to start, I may have resembled the confused looking dog on the cover for a while initially! It is not a question that I have ever really been asked before in detail, so it took quite a lot of thought! The essence of the questions that I have received from listeners is, factoring-in the potential returns, fees and taxation of the 2 options, which one will yield greatest net return, an investment in a low-cost fund (if such a thing actually really exists!) or a pension in a regular managed fund!? We are making one BIG assumption here, and that is that in the investment you are paying low fees and in the pension you are paying high fees. I say this is an assumption because this is not always the case of course.....but it was the question posed so let's take it head-on!

Paddy Delaney

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This week we are taking a closer look at the fabled '4% Rule' relating to drawing-down on investment or retirement pots. This particular 'rule' gets plenty of airtime in the US, UK and many other countries but from my own experience very few investors, pension holders here in Ireland seem to have heard of (and indeed even many advisors!). Let's try fix that! We are not going to challenge this 4% Rule today, merely we'll determine what it is, how it is relevant and how to go about figuring out what it might suggest for you.

Welcome back to Ireland's only dedicated and straight-talking personal finance blog/podcast. We are on a mission to tell the truth about money and are so thoroughly enjoying the journey! It is always great to hear from listeners so if you have any suggestions or ideas for us to explore please do send me an email here. As an aside, this week I got to meet a bit of a hero of mine. I travelled over to Penzance in Cornwall and spent a good few hours trying to learn as much as I could from the one and only Pete Matthew who has been creating really engaging personal finance information via video, blogs and podcasts for 5 years now. Such a pro, it was great to meet him. Check out the magic here!

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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We have recently been asked to share ideas on how an individual (or couple) can ensure their investments/estate/assets are properly distributed and managed once they die. It is an area that is of real value and interest to both the people who may be 'receiving' and indeed obviously to the people that are 'giving' it!

While Trusts are an area that we have touched-on in previous episodes we would not claim to be legal experts on the matter. For that reason we have invited Pauric Druhan, a qualified solicitor and trust expert from Pearse Trust, to join us on the Podcast.

Pauric shares his experience and knowledge on the different types of Trusts but more practically he shares examples of how they can be used and in what circumstances they can be of benefit to people who want to manage the 'distribution' of their estate before and indeed after they die. It is a key part of Estate Planning in Ireland and in reality it is something that most in this space would benefit from being more aware of.

Have you ever asked; What Are Trusts? Do I Need A Trust? How Do Trusts Work? If so, you might find some useful ideas in this episode of Ireland's award-winning Blog & Podcast.

As you will by now be well aware we are on a mission here at Informed Decisions to help our listeners and readers to make effective decisions for themselves which will result in better financial outcomes, and this episode is no different! Please do drop me a mail with your suggestions, questions or feedback.

You're a Legend!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland's only dedicated Financial Planning & Investing Podcast & Blog. We are on a mission to do things differently and to actually help people make decisions that help them achieve the results (& life!) that they want to achieve.

This week we have a rather special guest, Mr. Guy Spier. Guy is the fonder of, and has been been the sole decision-makers of the Aquamarine Investment Fund for 2 decades. This is nothing outlandish however the fund has an impressive return rate for investors over that period of time.

He has recently launched a superbly insightful and honest book called 'The Education Of A Value Investor', aspects of which we discuss in some detail.

We are thrilled to chat with Guy and gain his insight on many aspects of both money and life. He tells us about his approach to work, investing, life and how the likes of Warren Buffett and Monish Pabrai have shaped him.

Be sure to drop us a mail if you have any ideas, suggestions or questions following this episode. You can mail me directly here.

Enjoy!

References:

The Education Of A Value Investor

Warren Buffett

Monish Pabrai

Guy's Aquamarine Fund

Guy's Twitter

Nassim Taleb

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In a meeting last week I was asked why my philosophy toward successful long term investing was so simplistic and boring. I was delighted! For context the people I was working with had understood me to have been in the financial planning profession for 13 years (correct) and that I was a 'finance expert' (marginally correct!). Based on these two bits of information they had concluded that I would have a very complex, very elaborate, and dare I say it, very confusing approach when it comes to investing. This is what most of us have been conditioned to believe. That is most likely as a result of the unnecessarily complex products and layers that are rife in the Financial Services Industry.

When I explained my (very non-complex) belief on how one can achieve long term success they essentially scoffed at it, as if disappointed that I had not unleased a bout of verbal financial terminology and nonsense on them! It really got me thinking, it challenged me, and for that I am so grateful. As a result of that interaction this week I am sharing a short (true) story about long term results when one investor took a complex approach and when another took a very very simplistic and boring approach....and let you decide which might work best!

Welcome back to Ireland's only dedicated and non-smoke&mirrors Blog and Podcast on a mission to help people make better decisions and ultimately to live the life that they want to live. All we ask in return is that you tell a friend and if you are feeling really enthused that you drop me a mail to say Hi, offer feedback that could help us improve this site, or indeed ask a question!

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As a young boy growing up many years ago a million euros (or pounds as it was!) always sounded like an inexorably large amount of money. If you had €1m you were officially a millionaire and were in our eyes elevated to a stratospheric status.......The same can't be said anymore though! While it no doubt is still a significant amount of money by anyone's standards the sheen of being a millionaire has dampened thanks to inflation mostly! Nevertheless we are are today going to explore how and if €1m in an Irish Pension is enough, and specifically explore if it would be enough on which to retire at say 60 years of age.

Welcome to Ireland's only dedicate Financial Planning where we are on a mission to help you get the financial outcomes you want and to avoid mistakes when it comes to planning, investing and decisions with your money. If you find the information that we create of use then all we ask is that you help us spread the word and tell a friend! All our blogs can be found here. If you have a question or indeed a suggestion on how we can make this site more useful to you I'd be delighted to hear from you, please do send me a mail here.

Impact Of Inflation On Your €1m:

In order to elaborate on the comments about impact of inflation on your €1m lets just look at that for a moment. It was 25 years ago when I was 13 years of age. When I was 13 years of age €1m seemed like a crazy amount of money. Indeed it was, and still is however if you had €1m 25 years ago (1993) and you put it under the mattress, it would today have approximately 40% less purchasing power, due solely to inflation.

According to data from Central Statistics Office you would need to have €1.61m today to be able to buy what €1m would have bought in July 1993! The price of goods and services here have increased by over 60% in those 25 years. If on the other hand you had invested that €1m in the S&P 500 Index in 1993 it would now be worth approx €12m!

Bottom line is that if you decide to invest your funds under the mattress you will lose every time! If you want to retain and indeed potentially grow your funds above inflation you may need to consider this. If you are a long-time listener you will know our views on that whole topic very well by now however!

Let's look at how you would be set if you retired right now with €1m, as a couple at 60 years of age......

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland's only dedicated Financial Planning & Personal Finance Blog & Podcast. Last year we won the award of 'Ireland's Best Finance Blog'......we have re-entered that same competition again this year, and will hear how we get on over the coming couple of months.....this might just be akin to the 'difficult second album'!! As we approach our 100th Podcast we have really tried to focus on the areas that our readers and listeners get in touch with us about and who come to us for help on an individual basis.....we are on a mission to help people to achieve what is important to them, and stay authentic and true to our values in the process. If you have any questions or have suggestions on how we can make this site the best possible resource it can be please do drop me a mail directly here.

Speaking of Financial Planning there is one short story which, for me, sums up exactly what Financial Planning is all about, and the part it plays (or not!) in people's lives. I first read it about 3 years ago and have often thought about sharing it here, but perhaps felt it wasn't 'financy' enough. That view changed when I was working with a really motivated and hard-working person recently, who was really consumed and motivated by growing her business (which she loved in fairness!) and making sure she made the most of the financial situation she finds herself in. I shared this story with her, and it really resonated with her. I am not going to pretend that it changed her life dramatically over-night but she did say that it gave her a little perspective on what is real importance to her both now and into the future....I hope you enjoy it!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome back to Ireland's award winning Finance Blog & Podcast. Delighted you have joined us! Our mission is to help people avoid mistakes and help themselves to live successful financial lives. Our big aim is to ultimately change how financial advice is done here in Ireland, to put the focus back on what you want to achieve, not the products that only really serve as the tools to enable you to do it!

This week we are exploring a much-covered topic. It has not been much-covered by us but if you google 'Director's Pensions Ireland' you will see 3.9million results, and every single one of them is trying to flog you one! However we are not talking about the pensions themselves here today, we are talking about the much more important aspect of all of this and focusing on the 'planning' aspect, the bit is (or at least should be) central and should come before the 'product' (pension!). We will compare the stories of 2 fictitious brothers, who have very different approaches to life, and who go about planning in 2 very different ways...............full blog here.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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There was a large scale research study done by Gallup Consulting Group (a hugely credible global research company) this year which shows that the majority of people under 35 years of age do not own any form of shares/equities through investments, pensions or savings. This is in comparison to 2007 when the majority of people under 35 did own some for of equities. The research also demonstrated that the majority of people over 35 years of age held them in 2007 and that today the majority of people over 35 still hold them! It got me thinking!

I remember vividly cycling my bike on my way from school when I was about 7 years of age and living in Skerries (yes I originally hale from 'enemy territory!). I was cycling along a quiet street and was passing a row of parked cars on my left. I was probably imagining I was Sean Kelly in the Tour De France and so getting a buzz from cycling past the cars a little too close, and mistakenly clipped one of the rear view mirrors of what I think was a Renault 11! Now i barely clipped it on my little peddler, i didn't even move it or damage it in any way. However that didn't stop what I can only assume was the owner of the car, who happened to be standing on the path beside the car, from letting an almighty roar at me, followed by some sort of fist-waving expression and a brief chase. It all seemed a huge over-reaction and a deliberate attempt to scare a young boy on his bike!

Needless to say the harmless young Paddy was terrified and with increased motivation cycled home at a truly speedy pace! Not sure why this was so ingrained in my memory however I do know that for the remainder of that school year I avoided that street altogether for fear of encountering the 'Reno Man' again! I ended up cycling a very long way to and from school and cost myself lot of unnecessary time and concern. That was the first time I experienced being bitten, and then being twice shy about repeating the experience. However I happened to pass the 'scene of the crime' as a teenager and it reminded of that day, but to say the least there was zero fear about encountering the 'Reno Man' again, if anything I was keen to see him so I could tell him what I should have told him that day! On reflection it was OK to feel the fear but it was foolish to act upon it and to then pay the price and the inconvenience for the rest of the year!

You might wonder what this has to do with investing in equities (quite rightly!). My take is that when it comes to pensions, investments, savings and all that boring stuff the truth is that many of us got quiet a fright 10 years ago (seems much more recent than that!) when the Global Financial Crisis hit. Anyone that owned equities/investments/pensions during that period felt the fear, the concern and either made a decision to act upon that fear or to do nothing!

A typical portfolio fund in an investment, personal or Director's Pension with 80% Equities and 20% Bonds fell by 35% from January 2008 to December 2008. A portfolio with 100% equities fell by 40% in the same period. Forgetting about the fact (yes the FACT!) that they both rebounded by 55 and 70% respectively in the following 12 months, this was a genuinely scary time for investors. Many people made the mistake of getting out of Equities during these temporary declines. They panicked. Some may have been forced to, as in they needed to get their hands on the money for some genuine emergency, but the vast majority who sold their equities during the temporary decline did so out of fear and panic.

In order to relive it let's picture a scenario. In 2006 everything is rosy. The Irish economy is booming, the good times are here. Bertie and his merry men are saying that this will last forever, that we're a mighty little country and that we should keep spending and lapping it up! Investments have delivered double-digit growth for past few years (since the tech bubble) and there is no reason to doubt that it will continue. You see your investment or pension pot grow in value from €200,000 to €250,00 over the course of 2005-2006. You are happy, you buy a few more houses, you buy a new car, install a new en-suite, a hot tub Jacuzzi out the back garden. The new decking is looking fabulous and your neighbours are all envious! All is well in the world!!

And then WHACK! The global economy collapses, we lose jobs, Joe Duffy is telling us the world is coming to an end, Lehmans Brothers and a few 'big hitters' (non prudent ones obviously!) go bust. Your property empire starts to crumble. Your decking goes mouldy and your hot-tub doesn't get used anymore because you're too busy worrying about things! Your investment/pension pot falls in value by 40%, from €250,000 to €150,000, and continues to fall. You fear for your life savings. What is going On? What Sort Of A Fund Is This? Will I lose It All? These are questions you ask yourself or indeed ask your broker or advisor. They probably don't have an answer that assures you in any meaningful way.

What happens next defines whether this investor achieves financial success or not. Full Blog at www.informeddecisions.ie

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Growth and Value Investing are both around a long time as an 'investment strategy', and there are compelling rationale for investing in either, there are many fans of both, yet there is also quite a lot of regular investors that have no real familiarity with either. We aim to fix that even if ever-so-slightly in this episode. We will endeavor to explain a few key things about this 'earth-moving' topic......!

1) What is Value Investing?
2) What is Growth Investing?
3) Who does either or both?
4) Which has given greatest level of return? (that's all anyone really cares about right!?)
5) Which one should I do??

Before we get into the nitty-gritty however I wish to let you know that I am thrilled that you are reading this, you obviously have an interest in your own finances and in making some good decisions when it comes to your money, which I admire greatly. I would personally be very thankful if you would tell a friend about what we are trying to do here at Informed Decisions, who knows, it might help them help themselves! Thanks.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Nobody likes to be suffering from something that they aren't aware of, particularly if it is a nasty and invasive something that has a long term impact on their well-being, & that could do so in a pretty significant way.......so this week we are going to explore and try to diagnose if anyone here is suffering from a nasty dose of Bid-Offer Spread on their investment or pension planning.

Welcome back to Ireland's dedicated Financial Planning & Money Podcast/Blog. We are on a mission to help you to achieve the things that are important to you, to achieve the life that you want to achieve, and to avoid costly costly mistakes! We are not doing any advertising, we are shipping our 'art', loving it, and hoping that it has the impact we intend it does (feedback so far suggests it is!). If you value what we are doing and feel it of worth to others then please do tell a friend, thanks!

Check Out Full Blog Here...

Paddy Delaney

QFA | RPA | APA | Qualified Coach

Drop us an email here....

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Thanks for joining us here on Ireland's only dedicated Financial Planning Podcast & Blog. We are on a mission to help you get what you want, and to help you make decisions which will help you lead a successful financial life, and to avoid costly mistakes.

This week we are joined by Hugh Murray, founder of Dolmen Recruitment in Dublin. Hugh has many years experience working with individuals and firms in Financial Services here in Ireland. He is well placed to share the latest trends and opportunities for people, be that Funds, Compliance, Sales, Accounts or Fintech!

Hugh tells us about trends in Financial Services, where there are opportunities for people who are new to it, or indeed those with many years experience and are looking for a new challenge. He also shares some of his knowledge on shaping a cracking CV, if you need to sharpen yours up!

We are always keen to hear from our listeners so do drop us a line here, if you have any feedback, suggestions or questions, we'd love to hear from you!

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland's dedicated investing and Financial Planning Podcast & Blog. We are on a mission to enable our listeners to help themselves to a better financial life. Thanks for checking us out!

It is not every week we get to chat to one of the most successful investors of recent times, who has also founded a fintech firm (Rubicoin) that is changing how investors go about their investing!

In this 45-minute interview we explore Emmet's own back-story, the origins and successes of Rubicoin, and he also shares his own top-tips on how to achieve successful long term investing, which is both practical and based on his considerable experience.

For more investing and financial planning insight please do check out our website and blog here.

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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For decades Bonds have been touted as the elixir to an investors' nervous tendencies when investments hit volatility. If you look hard enough it will become clear that the only rationale for having Bonds in your investment portfolio is to help you cope when the market tanks again. Whether it is an existing pension fund or a personal investment you have then you may already have a shed-load of Bonds in there, and you may be very wise in doing so, or not! We conduct a study of 3 very different Portfolios to determine the impact having Bonds in an investment portfolio has, whether times are good or whether times are bad!

We do not react to markets here, we do not run with the topical 'noise' that is flaunted on media, all of that is just noise, and you as an investor would be well advised to ignore it all and stick to your plan. The fact that market volatility has been mentioned in the past week is merely a coincidence, this episode was being created now, irrespective of the noise!

If you are new here then you are indeed most welcome to Ireland's dedicated Financial Planning Podcast & Blog. We are not perfect by any means, but we are brutally honest and hopefully convey relatively complex stuff in a clear manner, which ultimately will hopefully help you make decisions which result in positive outcomes for you, and helps you avoid costly mistakes! To our returning readers, you know we love you!

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If we were to take a close and honest look at it very many of us, I'm guessing, would admit that we have not given much if any consideration to where our journey in life might take us, or indeed where we WANT it to take us. For some reason we don't accept the fact that we actually do have some control over it, some.

Welcome back to Ireland's dedicated Financial Planning & Personal Finance Blog & Podcast. We are on a mission to help as many people here in Ireland to achieve what is important to them, whether that be life or money related......it's all tied into one! We create a weekly blog & podcast in the hope that it will help some people make decisions that will increase their chances of achieving or doing whatever is important to them; which is exactly what we are talking about here today actually!

There is a movement happening in the UK for the past 10 years or so, and we are slowly starting to see it happen here in Ireland. I was invited to speak at a Financial Planning conference (short video here) last week in DCU, which was lots of fun. But more importantly, the fact that over 200 Financial Advisors & Planners were present indicated a desire and a commitment to improve the service and benefit that you (the client) receive from financial advice. There is a definite realisation that there is more to advice than products! I have been beating the drum for the past 2 years and encouraging our readers and listeners to 'begin with the end in mind', but it's probably time to delve a little deeper in that, and explore the positive impact that doing that can have.

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This week in Ireland's dedicated Financial Planning & Personal Finance Blog & Podcast we take a look at what has been my worst investment ever, but also my greatest lesson as an investor. I am an open book, and happy to share this with you, in the hope it may help others avoid the same mistake! It revolves around a company share scheme that I was involved in 10 years ago, and a cheque which I received only last week for a grand sum of €0.26 (yes 26 cents!) which was what I got back, in total, having previously invested almost €10,000! Here's how it happens.......

Thanks for listening, please tell a friend!

You're a Legend,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we are trying to share a simple message, an appeal to you, one which we hope will help move things forward for you in a positive direction. When we procrastinate about or delay committing to positive action we will always manage to rationalise it in our own heads, always! We are masters at it!

Some of us are more prone to this than others, personally it's one I regularly struggle with. No matter how blatant our delaying tactics are we will quickly come up with an excuse, a rationale as to why delaying it is the right thing to do. Even if we know deep-down that we are dragging our heels and jeopardising the thing that we really do want to do, achieve or get. That's what makes us human, and so very interesting beings!

Welcome back to Ireland's only dedicated Financial Planning & Personal Finance Blog & Podcast. We are on a mission to help you get what you want in life, and you are truly welcome to our little website! We would be delighted to stay in touch, and to share with you a weekly update, just pop your email over here.

Thank You,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome back to Informed Decisions, Ireland's only dedicated Financial Planning Blog & Podcast. Hope you are winning! When it comes to investing in Ireland there are many folks that have no interest in what they are investing in, provided it makes them a decent return and it doesn't disappear over-night!

Others like to take a closer look at their options, to think about portfolios and what they should be doing. They might like to identify what will work for them as a suitable portfolio, to figure out if there is anything they could invest in that they had not previously heard of or been aware of much. This episode is for these types of people! (not to suggest that the 'other type' aren't welcome to keep listening!).

Is Small Cap one of the best things you can invest in? What are the risks of investing in Small Caps? How can you invest in Small Caps? These are some of the aspects we take a look at in this weeks episode.....thanks a mill for checking it out.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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We don't ever go out of our way to be pessimistic on this blog, in fact we tend to be quite the opposite, having a firm belief that optimism is the only valid way when it comes to investing. However, when it comes to borrowing, which as we all know is essentially the reverse of investing, it pays, quite literally, to be even a little pessimistic!

If you are new to our website then you are truly welcome, thank you so much for giving us a chance to help create a positive financial future for you. We are on a mission to become THE place where people of Ireland turn to for practical and truthful information and ideas in regards their Financial Planning, Investing & Personal Finance. Thank you for playing a part in this mission. Be delighted if you joined our growing community here.

Buying a home, whether it is your first, second, third, fourth (well maybe the novelty wears off around now!) or whatever, is an exciting time. For many purchasing a home is a way out of a tough situation or indeed an opportunity to put down roots that they feel desperate to put down. We have no intention of talking anyone out of doing what they need to do, but invite you now to consider some aspects prior to committing..........

Thanks for tuning-in,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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"Gold gets dug out of the ground in Africa or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around and guard it. It has no utility. Anyone watching from Mars would be scratching their head"

Those remarks about the logic of owning gold as an investment were made by someone far more experienced and accomplished in the world of investing than I, and who has been recognised over the past 4 or 5 decades as one of the single most successful investors of all time, Warren Buffett.

We have written about the fact that there is a significant fall in the value of markets on the horizon, there always is, it is merely a matter of when it will happen, not if! Whenever that happens there is usually a run to gold as it is seen by many as a 'safe-haven' for their funds when the equity markets are falling. Why people don't just do nothing, and leave their investments alone in order to benefit from the constant upward curve of growth that the equity market provides is another issue altogether! Aside from that the fact is that gold gets very popular when markets hit a downturn, so we are going to explore the pros and cons of owning gold for investment purposes.

If you are new here then you are most welcome to Ireland's dedicated Financial Planning and Personal Finance blog and podcast......we are delighted that you have joined us! If you are a returning visitor you'll already know we love you!!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome back to Ireland's dedicated Financial Planning Podcast & Blog.

We have had a lot of enquiries about Peer 2 Peer Lending over the past few months, so we thought what better way to find out the detail than to interview a man that has been involved in it for many years. Oli Cavanagh is co-founder of an Irish Fintech 'Fender' which is focused on growing the Peer2Peer marker in Ireland.

We met with Oli to learn about P2P lending, how it works, what to watch-out for and to hear about the growth of their firm Flender.

Drop us an email here with any questions or suggestions you might have, would love to hear from you!

You're a legend,

Paddy Delaney,

QFA | RPA | APA | Qualified Coach

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In Blog 61 we mentioned Section 72 plans and said the following....These are creations of the Financial Services industry endorsed by the Revenue and are sold to people as a means to reduce or indeed eliminate a potential Inheritance or Gift Tax Bill down the road. They cost money and I am told are not as much fun nor rewarding as giving the money to loved-ones while you are alive! Having said that they can work very well for some people in building an effective Financial Plan and planning their inheritance in a tax effective manner, particularly if the estate is of a size and time is against them in gifting enough in the time left! We will devote full episodes to both these types of plans in the near future.

So, as promised a few weeks ago we now going to try explain what exactly a Section 72 is, and isn't, and how to ensure that, if this is something you are thinking is for you, how to ensure it does what you want it to do for you, to achieve the goal you have in mind.

Speaking of goals, that is what we are on a mission to do here at Informed Decisions, to help you achieve the goals that are important to you. I completely empathise that our industry doesn't always make it easy to see the wood from the trees but that is our mission, to help you get whatever it is that is important to you. You can join our community here, and please do share this with anyone you feel may benefit from it. Boom!

If you can't or don't want to spend the money or give it away before you die then a Section 72 plan may very well be a really useful and cost effective last resort to help cover the tax bill that inherently (no pun intended!) arises when someone dies with too much money. The very worst case scenario is that a vast swathe of the estate is handed over to the revenue, this might just be a means to protect against that fate.

Thanks.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Optimism is the madness of insisting all is well when we are miserable.

These words are reported to have come from Voltaire, the acclaimed French writer and philosopher. I am neither a Frenchman or a philosopher but I would like to put forward the suggestion that Optimism is actually the only way! When backed by concrete evidence it is the only rational belief to have, particularly so when it comes to investing your money over the long term.

This piece aims to convey the rationale for such a belief whether you are savings €100 per month into a savings or pension plan, or have €10 million invested in a well diversified equity portfolio. This is not a debate about the virtues of owning equities over commodities, or for indeed property. Developing and nurturing this belief is the single most important attribute to have in achieving long term investment success. We can't predict the future values of equities, nobody can. The future is always uncertain, however it is rational and human to base our expectations and beliefs on what has gone before.

Firstly please allow me to confirm that optimism does not equate to sentiment. The Consumer Sentiment Index hit a 17-year high in January of this year. This suggests that as a nation we feel confident about the outlook for the economy, right now. This sentiment is a fickle thing which changes constantly based on our environment, it is not an over-arching belief.

Optimism, in this instance is an over-arching belief. It is a belief based on evidence. This evidence shows long term growth of the 'equity market' is upward only in its trajectory. While our industry might like to mystify and complicate things the 'equity market' is nothing more than the value of the World's profit-generating companies.

The basis for this belief is supported by a vast ocean of evidence. One recent piece of credible and researched evidence to refer to is 'The Rate of Return on Everything, 1870 - 2015, produced by five economists including Oscar Jorda of the Federal Reserve Bank of San Francisco and Katharina Knoll from the Deutsche Budesbank - examined the return on all asset classes in 16 developed countries over that 145-year period. It found equities returned 10.75% a year over that time. That is, more than 10% annual growth every year, on average, for almost a century & a half.

There were, of course, years where the return was negative 20-40% over that time period. Investors must learn to accept this fact, for it is these temporary declines in values that deliver such impressive returns for the investor who does stay the course. Those who cannot stay the course in the face of these temporary declines ultimately pay the price for their pessimism. Enabling you to stay the course is where a credible financial advisor can pay for themselves many time over, their value far exceeding their cost, but only if that relationship is build on mutual respect and trust! History has shown that over the long term a well diversified equity portfolio has delivered far in excess of inflation, which is ultimately the curve most investors strive to stay ahead of, otherwise they are losing money.

If the world's companies is your investment of choice then there is much to be optimistic about based on current trends. According to the World Bank 42% of the world's population was defined as living in extreme poverty in 1990. As of 2016 the World Bank suggest the percentage in extreme poverty has fallen to below 10%, meaning 90% of the ever growing population now have more disposable income, and can purchase the produce and services they desire. Who benefits from this expenditure? The companies of the world who provide them with goods and services. The same companies form the 'equity market' which investors can be owners of when they purchase a well diversified equity portfolio. In addition, research by Brookings suggest that 140 million people are exiting poverty and entering middle-class each and every year on this planet. That's nearly 3million people per week with ore disposable income.

There will be another equity market crash, the evidence has shown that volatility is part and parcel of the journey. A period of temporary market decline is never more than a few years away....but learn to accept that, to welcome it, to see beyond it, and recognise that the 'markets' reward those who believe that declines are temporary, nothing more and nothing less. The 10% returns mentioned earlier were achieved despite many global crises, many dark days, many wars, and many self confessed experts predicting that this time the world really was going to end!

Please excuse me if I conclude by contorting Voltaire ever so slightly and suggest that.......madness is insisting that all is miserable when all is well!!

Optimism is the way....

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Andy Hart is one of the UK's highest profile Financial Planners. He hosts his own Podcast, runs a successful Financial Planning firm, and is the organiser of the what is rapidly becoming UK's premier Financial Advisor & Planner Conference (Humans Under Management). And to top it all off he has invited me to share some ideas at his upcoming Dublin Conference.....so I'm super excited about that......We chat with Andy Hart of UK Financial Planning firm Maven Advisers to discover what exactly Financial Planning is, how it benefits clients, and how he saves them from themselves!

As you will know we are on a mission here at Informed Decisions to help improve the financial futures of our listeners and readers. We have been voted Ireland's #1 Finance Bog & Podcast in Ireland, and are on a mission to keep the boot down and get the message out to as many people as we possibly can.....your help in sharing this with your friends, family & colleagues helps spread the word (and keeps me motivated!), so please do share the love! While you are at it we'd love to have you join our wee community here.

Drop me an email here with any questions or ideas for future episodes you would like covered.

You're a Legend!

Paddy Delaney

'Chief Informer'

QFA | RPA | APA | Qualified Coach

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Recently we had a few questions from people who were saving for deposits for their first homes. This week we had another, from Daniel (surname not shared for obvious reasons!), who having read our piece about the impact of inflation on deposit values over the medium term has been moved to get in touch and ask us what are the alternatives!

Did you partake in our 2 minute survey yet?? If not then please please do, we would really value your opinion and help us shape what we cover on the blog & podcast. It's just here.....thank you.

This is timely, seeing as this week we have also been contacted by Louise McBride, journalist with The Sunday Independent. Louise was seeking our take on what alternatives are available for people who are not content with deposit. While we will cover low volatility investing options in more detail soon I am keen to try to answer Daniel's question. If you are new here then please do check out our 'Why' and we'd be delighted to have you join our wee community of Informed-Decisioners here! We are on a mission to enable individuals to help themselves with their financial futures, and to help them get whatever they want.

In this episode we will explore specifically Daniel's question which was.....'I plan to save for 5 years then buy BUT if the purchasing power of my money could lose 10% (5 years * 2% inflation) am I better off investing in a ‘safe’ fund with some (almost) guaranteed level of return?'

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Regular readers of the Blog and listeners of the Podcast will know that we are on somewhat of a vocation here at Informed Decisions! We are striving to help people get what they want, to take control of their own financial futures. We are not doing this for the applause (though that is nice to get it when it comes!). We are doing this to make a meaningful and positive difference in the lives of those we touch. We aim to connect meaningfully with you.

We could of course just blindly go and do whatever we think is the right thing to do here, but we feel it more worthwhile to seek your feedback, your input and your say on what would be of use to you. We are absolutely not the best in the world at all things financial, but we do try our best to create things of use to other people.............as Seth Godin might say 'we are shipping our art'! Some will benefit and some will not. We are hoping to be of benefit to as many as we can.

So this week we have something a little different, we are asking your opinion. Long term listeners will recall that we asked something similar of you in 2017 when we asked you to complete a short survey. Almost 200 of you beautiful people duly obliged! In turn we donated a few hundred euro to Irish Cancer Society.

This year we have created a short 2-minute feedback form that we would love you to complete. Whether you are read the blog/podcast religiously or checked it out one or twice we really would value your feedback. If you have never read or listened to our stuff then it's probably not relevant to complete the form!

So Whats In It For Me??

This year we are going to offer €100 One4All Voucher, and we will donate €100 to the charity of the winner's choice. Even if you do not wish to enter the draw we would really appreciate your feedback.

How To Enter?

In order to be entered in the draw when you complete the feedback form please leave your name in the comments section of the Facebook post on the Informed Decisions Facebook page.

This way we can keep the feedback anonymous but also be able to pick a winner! If you are not on Facebook just drop me a quick mail here to let me know you have completed it and I will add you to the wheel of fortune for the draw!

When Do I Win??

We will run the survey until 12th March, or until we reach 200 responses, whichever is sooner!

Thanks

We are always keen to have your input on what we create and do, and we definitely appreciate all our readers and listeners, and the support and encouragement we have received since we started this 'crusade' almost 2 years ago!!

You're a Legend!

Paddy Delaney.

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It is fierce common lately to hear the financial industry give out about the rates of interest available through bank deposit accounts and to recommend that you should invest your money into XYZ Fund (which just so happens to generate a nice chunky commission for whoever is doing the recommending!). It's funny, they weren't saying the same when equity markets were falling 30% per year and deposit rates were up at near 5% per year! (although they should have been!)

We will explore in this episode whether deposit really is a good place or not to keep your funds over the long term.

Welcome to Ireland's #1 Financial Planning Blog & Podcast. We're on a mission to share straight-forward ideas and information to help you get whatever financial life you want to have. We rely on feedback to help us improve the impact we have on our readers and listeners, so drop us an email, leave an iTunes review, and share the article if you feel it's of use to others.

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This week we get to chat with a guy who is making quite a name for himself. He is advocating for greater investor education, in particular with regards to the long-running debate on the value of Active Fund Management versus Passive or Index investing.

This is the latest episode in Ireland's only dedicated Financial Planning & Investing Podcast.....available on iTunes, Podcast Stitcher, Podcast Addict and all other podcast players. If you find our podcast or website of any use then we would really appreciate your support, ideally as a iTunes review!

We are on a mission to help our readers and listeners to get what they want in their financial lives. Why not subscribe to our community to get access to the latest information once it becomes available.

Robin Powell is an award-winning journalist, blogger and content marketing consultant, based in the UK, with specialist expertise in the investing industry.

He works primarily work with asset managers and advisory firms at improving outcomes for the end consumer. He also campaigns for better investor education and for greater transparency in global asset management. As well as The Evidence-Based Investor, he edits Adviser 2.0, a blog which explores the changes taking place within the financial advice profession.

He is the producer of two highly-acclaimed online documentaries about investing — How to Win the Loser’s Game and Index Funds: The 12-Step Recovery Program for Active Investors.

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Welcome to Informed Decisions' very first 'Business Success Series'.

Our main focus over the past 18 months has been Financial Planning and all aspects of Personal Finance. By all means have a look at our back-catalogue here. We have a huge interest here too in the success of others, and in business successes. For that reason we will bring you 5 or 6 Business Success stories over the course of 2018, to hear how they succeeded and the financials behind their success.

This week we are joined by Paddy O'Connell of Paddy O's Granola, who have been growing from strength to strength since it's beginnings a few short years ago.

If you feel you have a great story to tell and would like to join us then please drop us an email here.

Hope you enjoy the interview, and thanks again to Paddy O for joining us.

Thanks,

Paddy Delaney

Helping Others Get What They Want

QFA | RPA | APA | Qualified Coach

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It is fair to say that the Financial Advice industry in Ireland has a reputation for forcing products on people, only making money when they sell 'policies'. The truth is that advice has so much more to offer, if it is done right! That is where Financial Planning seems to come into play. A Financial Planner can still sell you policies I guess, however the onus of a Financial Planner (if they are really behaving like a Financial Planner) should be on exploring your future plans, and helping you determine a clear way forward, that maximises outcomes for you. Family Home Relief is one such thing that Financial Planning can help people be aware of......so here goes!

This week we'd like to introduce you to Jack. Jack is in his 40's, and his parents, Frank & Sharon are both in their late 70's. Frank & Sharon had worked hard their whole lives, and through effective Financial Planning were able to retire at 62 with their desired lifestyles intact (nice cars, meals, clothes, holidays and hair & make-up!). They have been living the proverbial dream for the past 15 years, and are now in pretty rough health, given their indulgences on meals and relaxation!

Frank & Sharon have spent the vast bulk of their retirement funds at this stage (as was planned), and have assets now of €50,000 low volatility investment fund, a car valued at €20,000, and their home, valued at €600,000. Sadly, and in order for this blog to make any sense, they both die, first Frank and then shortly afterwards Sharon. Their entire assets are left to Jack, who is obviously very emotionally distraught, but has now inherited their assets!

Full Blog Here

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According to Central Statistics Office the average salary in Ireland (2016) of a full-time employee was a 'grocery-shop' more than €45,000. Knowing that figure might make you feel that you're doing well or it might make you feel like making progress on the income you are bringing in. In reality this is the main thing for many of us as we go through our careers ,our own sense of value and worth can unfortunately rest squarely on the amount of money we are paid to do a job for someone else! It's totally cock-eyed but for many people in ireland's society this is what they judge their success on. It's something that I am passionate about changing over the years, I just haven't quite figured out how yet (answers on a post-card please!).

Anyway, as 'things' pick up in our economy, there are more and more jobs for people to move to, more and more salary increases happening, in comparison to 2008-2013 at least! While it is not being achieved by everyone there are at any one time many people getting salary increases, be that as a result of promotion, moving to a different employer on a higher salary, or hitting targets when they had not been in the 'rough times'.

Welcome back to another edition of the Informed Decisions Blog, Ireland's #1 Financial Planning Blog & Podcast! This week we will explore some of the common things that people do with salary increases, and share a few ideas to ensure you don't do the same!

Full Blog Here.

Cheers,

Paddy Delaney

Leave an iTunes Review......

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Welcome back to another edition of the Informed Decisions Blog, Ireland's #1 Financial Planning Blog & Podcast! This week we will take on an obscure topic, a topic which is often left till the bitter end before we give it consideration! When it comes to focusing on your Financial Planning, Financial Independence or 'building wealth' it pays, quite literally, to begin with the end in mind!

Speaking of Financial Planning I am delighted to share with you that the 'My Money Matters' Programme I was invited to help create with Count Her In is now alive and well (and carrying a decent introductory discount!) It was a really great thing to be involved in, to be creating a Programme which I believe will have a hugely positive impact for people that want to make positive changes in their finances. It made it all the more rewarding to get paid a few euro for my time and expertise in helping them create it! Seriously, we hope it is of real and tangible long term benefit to anyone who feels it would be of help.

How Can We Die With Too Much Money!?

We'd like to now introduce you to this weeks' fictitious characters, Sinead & Johnny. For simplicity we'll say they were both born in 1948, meaning as of 2018 they are 70 years old. Sinead is from the South East, but living in Dublin since she was a young lady, lured by the handsome young Johnny at the time! Sinead worked on and off over the years, while also rearing their 2 children, Sheena & Joseph, who are now in their early and late 40's. Sinead's husband Johnny worked all his life, most of it in 1 large factory, originally as a labourer and then moved into supervisor and management roles. Johnny loved working and only retired fully from paid employment at the age of 69. Since then they have both been enjoying the spoils of their 50 years of work, travelling, going away for weekends with friends & family, and enjoying the company of their 5 grand-kids!

Read full blog here.......here!

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We all love an oul get-rich-quick scheme don't we!? Even if we know it's far too good to be try we will 'click' through or read beyond the head-lines, we just want to know more, 'sure its only looking'.......that is what has you reading this right now! Well I am on a mission to train you out of such inquisitiveness, this is lesson 1!! (and it's totally free!)

Imagine a perfectly sane and prudent nation of people getting swept up into a frenzy of buying, trading and bargaining of a particular item, an item that holds the value of a common flower bulb. Imagine the same frenzy taking hold of an entire nation for over 3 years, eventually resulting in a catastrophic downturn and wiping-out of many many of its' citizens personal wealth and life-savings.

We will explore such an event which happened in the not too distant past, and explore what we can learn from it to protect ourselves from such get-rich-quick schemes in future. (some people have drawn similarities between this event and Bitcoin, we aren't doing that as they are totally different products & we have no idea how Bitcoin will progress, however the behaviour of the masses might not be that dissimilar!).

Here for the full blog version.

Paddy Delaney.

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Oxford dictionary define a commodity as 'A useful or valuable thing'. Another definition they put out there is 'A raw material or primary agricultural product that can be bought and sold, such as copper or coffee'. Whichever way you look at it, be that a useful and valuable thing, or indeed a basic product, Commodities have found their way into many many pension and investment portfolios.

Apparently as many as 4,000 years ago our Neolithic ancestors here in Ireland made use of cattle, for food, leather and indeed milk. Many of you reading this may never have milked a cow, however you may well own a very tiny portion of a fund which tracks the price of those fine animals!

Chances are, if you are a member of a company pension scheme, or have some spare money invested, you are investing in Commodities, whether you know it or not! As strange as it may sound cattle prices are frequently an aspect of Commodities in investment terms, so you could well have an active interest here!

We are going to look at the pros and cons and alternatives to investing in Commodities, either as a lump sum investor or a pension investor here in Ireland.

Check out the full blog version at www.informeddecisions.ie

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Hey,

We've spoken about volatility here before, and we have put it on a bit of a pedestal on account of it's hugely positive influence on the long term saver/investor who embraces it and recognises it as the huge ally it is. Euro Cost Averaging (Or Egg-Cost-Averaging as you'll see in a moment) is an outcome of these fluctuations.

Euro-Cost-Averaging is just one of the many aspects of Financial Planning in Ireland, which goes some way to explaining why our Financial Planning and Money Podcast here, is over 60 episodes old and we have so so much more to share with you dear readers and listeners. We are on a mission to become the place for people to turn when they need real information and insight which is un-biased and practical to Irish people who want to deliver positive financial futures for themselves....not too much to aim for!?

What is Euro Cost Averaging?

This is a jargon term the industry created many moons ago. In plain English it refers to the fact that if you are saving regularly into an investment, that investment will increase and decrease in value over time, meaning you are buying into that investment at these various points, some high, some low, which results in an average price paid.

Imagine you buy €2 worth of eggs every week from old Mrs. Corrigan (fictitious character!) up the road. The number of eggs you get for your €2 from Mrs. Corrigan on a given week is based on how much demand there is for the eggs, and how productive the hens have been that week! For example one week you get 12, another week it is 8, the following week 9, another week 10, another week 9 and another week 12. Over that particular 6 weeks you got a total of 60 eggs. You paid a total of €12, so the Egg-Cost-Average here would be calculated as €12.00/60 = 20cent per egg, over that period of time! Simple! Though we like to let on we are very smart in the Financial Services industry, that is basically what Euro Cost Averaging is!

Is Euro Cost Averaging An Investment Strategy or Just An Outcome!?

While some argue that it is an investment strategy designed to reduce volatility and 'average-out' your returns over the long term, while others suggest that it is an outcome, whether positive or negative, when an investor contributes a certain sum at regular intervals over a period of time.

We suggest it is indeed the latter. There is much research which points to the fact that as an investment strategy, it is flawed and statisticaly less likely to deliver better outcomes than investing it in one lump sum. Say you have €150,000 to invest, research suggests that it is best to invest it as one contribution instead of trying to time the markets and drip-feed it into a particular strategy over a period of time, say 12 months. You'll see why shortly.

In the USA Euro Cost Averaging is known as Dollar Cost Averaging (DCA). Finance journalist Dan Kadlec of Time Magazine summarized all the relevant research research when he wrote, "The superior long-term returns of lump sum investing (instead of DCA) have been acknowledged for more than 30 years. Similarly, decades of empirical research on DCA has found that it does not function as promoted, and is a sub-optimal investment strategy". This debate is one for another day, the main purpose of the past 2 paragraphs is to outline what Euro Cost Averaging is, and is not, and how it impacts.

So What Does Euro Cost Averaging Actually Do?

What better way to explain it than to display it in numbers. Let's imagine this weeks' character, we'll call her Grainne, starts a regular savings investment or indeed a pension where she will be contributing the same amount every month, even for 6 months:

Month 1 - Cash Invested: €300 Unit Price: €1.00 Units Bought: 300

Month 2 - Cash Invested €300 Unit Price: €1.10 Units Bought: 272

Month 3 - Cash Invested €300 Unit Price €1.50 Units Bought: 200

Month 4 - Cash Invested €300 Unit Price €1.20 Units Bought: 250

Month 5 - Cash Invested €300 Unit Price €1.15 Units Bought: 260

Month 6 - Cash Invested €300 Unit Price €1.00 Units Bought: 300

So, as you'll see from above, there was quite a lot of volatility in the first 6 months of Grainne's investment journey, that's purely for illustration purposes! The value of the fund she was investing in grew by 50% in value and came back down to the price at which she had started investing 6 months ago. How does that leave her in terms of being up, down or level!?

Grainne has at this stage invested €1,800 (6*300). She has a total of 1,582 units in this particular investment, meaning she has paid an average of €1.14 per unit. Considering that her units are currently all actually worth €1.00 she will actually be down money, as she paid a high price for units relative to their current value, particularly in months 3 and 4! She would have invested €1,800, as we saw, and as at month 6 her fund would be worth €1,582 (1582 units * current price of €1.00!). Grainne may well feel like this has been a rubbish investment, and want to cash out her chips now, but alas we must not allow her take such a knee-jerk reaction.......

So, whats the moral of this particular story I hear you ask!? Well as you can see, if you are buying units (investing) on a regular basis, even with Euro Cost Averaging, you would be best advised to keep a hold of your investment until the value comes above the average price at which you have paid over the course of the investment journey. If you are in a pension, the timelines will obviously be much much longer, however the same principles apply.

Another moral of the story is that, if you are investing regularly, it may seem counter-intuitive really you do not want to see the value of the fund going up! At least until it is time for you to cash in your chips! You really do want to be buying them at a low price, accumulating them at a huge volume, and when they come up in value, you cash them and then enjoy the fruits of your labour! Buy low and sell high is a term we have all heard of, Euro Cost Averaging can help you achieve that......let's see how..

Does It Help Me As a Saver?

In this story we're going to outline Joe's investment journey. He is a good guy, has a great financial coach who has identified his goals, and indeed his concerns regards his retirement planning. Joe needs to accumulate a pot of €200,000 by the time he is 62 in order to allow him reduce his hours, and to support the lifestyle that he desires, in addition to his other assets he has. So off Joe goes and start contributing €600 per month into his pension....

Month 1 - Cash Invested: €600 Unit Price: €0.20 Units Bought: 3000

Month 2 - Cash Invested €600 Unit Price: €0.18 Units Bought: 3333

Month 3 - Cash Invested €600 Unit Price €0.15 Units Bought: 4000

Month 4 - Cash Invested €600 Unit Price €0.12 Units Bought: 5000

Month 5 - Cash Invested €600 Unit Price €0.14 Units Bought: 4285

Month 6 - Cash Invested €600 Unit Price €0.20 Units Bought: 3000

Joe's initial 6 months were too a roller-coaster, with his fund falling in value by 40%, from 20c to 12c at one point. In real terms this would most likely feel like armageddon again, there would be some sort of economic crisis to drive a well diversified portfolio down by 40%, but it will happen again soon, mark my words! So, despite this sense of panic around the place, thanks to the strong financial coach that is working with Joe he persists and has faith in the constant upward curve that is global equities, and he actually end up big-time in the green.

Joe has invested €3,600 at this stage, he has a total of 22,618 units. Divide one by the other and we can see that the average price Joe has paid for his units has been just under 16cent. They are currently worth 20cent, so his €3,600 is now worth €4,523! And that was having gone through a financial crisis that had eroded 40% of the value of his fund at one point!

Moral of the story for Joe? If you are regularly investing through a crisis that smashes the value of your investment fund, you are buying cheap, you are accumulating huge numbers of units at a discount......it's like a Next Sale in Blanchardstown Shopping Centre.....except at this sale every eejit in the country is quite wrongly telling you to keep your money in your pocket/deposit account....more fool you if you listen to them!!

How Would It Have Gone If They Invested a Lump Sum?

The funny thing is that if Grainne had of invested a lump sum in month 1 instead of regular payments over the 6 months, she would be in the same position she started, having paid €1 per unit at the start, the same point it was at by the 6 month point. So for her, you could argue that she'd have been better off doing a lump sum, but you can only say that based on the value it is right now.......

If Joe had invested a lump sum, he would be breaking even at this point also. He is better off having paid regularly.

The moral of that story?! Nobody can tell what the markets will do, it is not a debate to get into, should I aim to Euro-Cost-Average or will I go with the Lump Sum, impossible to answer, it's a bit like the old chestnut of a question, 'Should I Fix my mortgage or go with a variable rate'!? Impossible to predict future rates/fluctuations.

What some would argue however, is that based on the fact that equity markets are positive more than 70% of the time, if you dollar-cost-average your way instead of going with a lump sum at a particular point in time (if you have the lump sum available) you will more than likely be paying higher prices by purchasing at more points in time.

This debate of Lump Sum or Euro Cost Averaging is for another day, so this might just whet the appetite!

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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We kick of 2018 full of optimism, gratitude and excitement for the year ahead. After what was hopefully a nice Christmas break we all are raring to go, and apparently as many as 50% of us (myself included!) feel that customary urge to set some resolutions for the year ahead.

The top resolutions that we make (the 50% that do!) are; weight loss, exercise related, smoking/alcohol related and money related. So even as a broad estimate this suggests that 15% of the population in Ireland try to motivate themselves into better money management habits at the beginning of the year.

According to Professor John C. Norcross Ph.D of University of Scranton Psychology USA, 10% of all resolutions result in sustainable change. Pretty poor that therefore 90% of all resolutions crash and burn!

We are keen students and readers of all things performance, behaviour and success related here. Never-mind it's impact on how we deal with our money, the ability to perform, behave or succeed has such huge impact on our life and the lives of those around us. For this reason we decided to kick-off 2018 with something a little different (this will be a common theme to 2018!).

What Do Resolutions Look Like?

Resolutions are often very broad and sweeping statements. I will give us smoking. I will spend less money. I will clear my credit card. I will eat less Ben & Jerry Ice-Cream! They all sound worthy, they are probably all very well-intentioned, however they are all vague. There is no time line, no specific action, no measure as to whether it was a success, or way of measuring progress.

As a serial resolution-maker of maybe 10 years now I, for one, can confirm that they just don't work! Not only that but by the end of January I've probably passed the self-deprecating phase of under-performance and am firmly into the 'I actually didn't want to change' phase by March. By April it's 'I can't remember what my resolutions were' phase!!

A resolution is defined as a 'firm decision to do or not do something'. Essentially the above resolutions, or decisions to do or not do something are based on habits, smoking habits, eating habits, exercise habits, money habits. Habits as we all know can be very difficult to change, hence they are habits!

Why Do Resolutions Fail??

We've done quite a lot of reading on this, seems there are a few trains of thought we will share here now, that might prove useful if you are one of the 'resolutioners' who struggle with making progress on your resolutions! Take what you will from these, some may seem more credible than others, perhaps see which one sits best for you!

1) False-Hope-Syndrome: When we make resolutions we often aim too high relative to what we truly believe we can achieve! For example, If I'm eating 15 portions of junk-food/snack per week and I set a resolution for myself of cutting all junk-food from my diet, my internal dialogue/subconscious is already telling me (quietly!) that 'there's no way in hell you're going to be able to do this'!! We have all heard of false-hope, so essentially what this train of thought suggests is that some of the resolutions we set for ourselves are walking ourselves into it, and a confidence-bashing if/when we fail to reach the targets we set ourselves!

2) Cause & Effect: This idea stems from the suggestion that when we set a resolution, and we actually do the new habit for a period, that if we don't notice the desired effect immediately we can become de-motivated and fall back into old habits! So, lets say I decide I want to be 'better with my money'. If I watch my spending, open a savings account and start popping money in for a few weeks, and maybe even start contributing to that pension that I had been putting off. Well unless I get the desired feeling and feedback from having done that i am in high risk of cancelling the whole friggin' lot and going back to my old ways! We love feedback, we love knowing that what we are doing is having a positive impact and that we will be much better off as a result. If we don't get that feedback quickly we might fall off the wagon!

3) Self-Stories: This suggests that we ALL have internal self-stories, views on how we see ourselves living and behaving. This internal and mostly subconscious viewpoint determines much of our behaviours, habits and importantly our decisions. Your subconscious has predetermined, based on your self-stories and self-talk, what decision you will make when you are confronted by the choice between a salad or chips and burger for lunch on the 18th January!! It does also suggest however that we have the power to change our internal self-stories now. We can, through visualisation and goal-setting change how we see ourselves living and behaving. This is said to be one of the single most powerful tools in performing as we want to perform, to achieving what we want to achieve and in ultimately changing habits.

Say for example that you wanted to clear the debt you owe on a credit card. Up to now you had been slow to clear it, instead you have in the past made unnecessary purchases, clothes, cars and other items instead of actually clearing your debt. If you have been this way for years then your self-story will likely re-affirm for you that you are 'bad at clearing debt' and that you 'love to buy nice things instead'. That is your self-story, for you right now it seems true. However you can change that story....we can convince ourselves of a new self-story, one whereby we will see ourselves as 'great at paying off debts quickly' and 'able to resist impulse purchases easily'. When we are next faced with a decision about what to do with the €300 left in your bank account on the last day of the month, you are much more likely to act in a way that is congruent with your new self-story.....you'll most likely happily direct that money to your credit card as opposed to spending it in Arnotts!

What Could We Do Instead of Setting Resolutions?

If you have been setting them then the research suggests that you are very likely to have failed. That doesn't obviously mean you should quit resolutions (ironic!). However there is a lot of research out there that suggests we should not frame desired behaviour change as 'resolutions' for ourselves. Instead there are, for example, some really powerful goal-setting tools that we could use to help us get to where we want to get to. Instead of having a broad resolution such as 'I will get better with my spending habits', try and build a goal using the following framework, SMART.

Specific: Try and be as specific as possible about the behaviour/habit you want to create. Don't aim to do lots of things, focus on the really important thing for you. Pick one not 5!
Measurable: If it is not measurable in some way then it will be impossible to know if you are making progress (feedback)
Attractive: It must appeal to you, deep-down be of meaning to you. If not it will fall by the way-side when life gets in the way!
Realistic: It much be realistic, by all means make it stretching but not crazy stuff! (false-hope)
Timely: If you are aiming to be doing the new habit, by what date exactly do you want to be doing it, and for how many days/weeks in a row. Ideally aim to do whatever it is your doing within the next 3-5 months max, any longer and it is too easy to put if off until 'another time'!

Using the above tool (which has been around for centuries by the way, not my creation!) may just help turn a vague and broad resolution into a really appealing, measurable and sustainable goal to be achieved by a certain date in the near future.

What Else Might Help?

The research shows, and personally I believe it, that if your goal is written down then you are much much more likely to achieve it, whether it is a goal, a habit, a behaviour, the action of writing it down, and ideally being able to see it regularly will keep it at the fore-front of your mind, might help re-write your self-story, and enable you to do whatever it is you have set for yourself.

It's probably worth noting too that they suggest it takes 21 days to form a new habit. It's kinda hard to understand how they have measured this! Irrespective of how long it actually takes it's probably fair to say that when we set off on our quest to reach our goal we should be patient with ourselves, good things don't generally happen over-night....so expect it to take some time!

If we can be of any support to you over the year then by all means feel free to use us! If we can act as an accountability partner, or someone to check in with on soem queries then please do so...if we can help we will help.

Looking forward massively to a hugely fun and full 2018!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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What do most of us have......really really desperately wanted it initially..........but now we really really want to get rid of (a clue, it's not your partner!).................the answer is of course our mortgage!

We have covered mortgages a few times on here, including the ever popular 'should I clear my mortgage or save for the future' episode. This week we are going to ramp up the pressure on existing mortgage holders, we are going to hold a mirror up to them and their habit, and indeed inertia! In a survey we held earlier this year we asked how many of you believed you were on the best possibly mortgage rate.....interestingly 70% of people were not sure!

That points to the fact that people aren't informed as to the best mortgage rates in Ireland at the moment, and whether they are getting the best deal available or not.....we are going to fix that right now! Switching mortgage in Ireland for some reason is no that popular versus many other states, however for some it can be a very financial prudent thing to do!

Firstly, thanks for checking out Ireland's #1 Financial Planning Blog & Podcast, we are delighted to have you visit! By all means please do check out our 'why' which will explain why we are creating this blog and podcast every week for our listeners and readers! Also, thanks a mill' to our latest iTunes Reviewer, it means a lot to us, so please do pop over and leave a review if you have a minute!?

Can I Switch My Mortgage?

There's no point in getting all excited about the benefits of switching mortgage (there can be many!), if it is not available to you....here's what you'll need to prove:

You have an existing mortgage!
You live there (usually only benefits 'owner-occupiers)
You have a clean payment history on that mortgage in recent years
You have consistent/permanent income(s) which the bank will deem sufficient to repay the 'switched' mortgage
You have the time required to compile documentation & attend solicitor and bank/broker in order to switch to the new loan
You will want to be benefiting financially in order to even consider switching, so you'll need to know what the savings (if any) will be
Be prepared for some element of hassle, as these things usually always have some twists and turns!
You will need to be of an age where the bank is willing to give you the new mortgage up to a reasonable age, some banks will lend to you till you are 65, others to 70.

Should I Switch My Mortgage?

Another humdinger of a question! We can't answer that question for you, but we can show you how to answer it for yourself. There are lots of comparison websites in this country, and there is no doubt that they help people get better deals. They make their money from people switching. There is also a government funded switching site that is pretty awesome, which we are big fans of here, and that is the Competition & Consumer Protection Commission website (I think they could do with some help on the name of the site in fairness!). It's a fabulous and totally un-biased site which is updated daily.....check it out here.

All you need to have to hand in order to do a comparison is the following:

How many years left on your mortgage
Approx value of your house
How much you owe currently on the morgage
How much you are paying each month

Be careful with number 4. Make sure that the figure you put into the calculator is the amount you are paying toward the mortgage each month. So of us have home insurance or mortgage protection included in the same direct debit. Make a phone call to your lender if needed in order to determine exactly how much the mortgage repayment is on it's own.

Whack the figures into the calculator and select whether you want to compare it to best Variable rates, or Fixed rates of the various terms 1 year to 10 year.

What is APRC?

In the next section you will see APRC referred to when detailing two different rates of interest on a mortgage. This stands for Annual Percentage Rate of Charge (as if we needed another acronym!). It is however the only accurate way to compare two rates as it includes all charges in the rate, including set up charges. It is common to see an interest rate quoted of say 3%, however the APRC is almost a full 1% (3.9%)......moral of the story is that you go with the APRC in comparing loan rates......now that we have that cleared up lets get on with the story for you....

How Much Could I Save By Switching Mortgage? A real-life story!

We want to share a real-life story with you. A friend of the show, we'll call him Jimmy, got in touch to tell us that on the back of a recent blog/podcast we did he went on the hunt to reduce his mortgage payment. He shared his story with us, and invited us to share it with other listeners so that they could too benefit from it.

Jimmy lived in his house with his wee family. The house was valued at around €290k. He had a mortgage of €170k, and was paying €915 per month. The rate was 3.9%. There were 25 years left on the mortgage. Jimmy and his partner are in their 30's.

They shopped around for the best rate mortgage they could find. They managed to find a market leading fixed rate of 3.05%, for a 10 year fixed mortgage. They were keen to fix it for the medium to long term as they wanted that security knowing it would not increase in future, that was important to them. This rate was subject to them switching their current account, which they were happy to do.

In addition they were going to get 3% Cash-Back provided the loan was drawn-down before March 2018. They were both working and earning the same salaries as when they originally took out the mortgage, with a clean payment history.

They got the ball rolling on the new loan via a broker, informed the original lender of their plans, and then followed the process with the new lender. Essentially the new loan goes directly across to clear the old loan, one cancelling out and replacing the other.

They are now paying €90 per month less than they were on the old rate, with the term the same as the original mortgage (they had the option of reducing the term but they wanted to keep it as long as possible for now). They also got €5,000 Cash-Back recently which has helped them hugely! All complete in a little under 3 months! yes they had to pay a solicitor €1,200 for the legal side of things, and there was some time invested in meetings and gathering info, however.....

Over the term of the mortgage this switch, including the Cash-Back, stands to benefit them €32,000! Delighted for them!

What About The Insurances?

When switching do try and keep your existing Mortgage Life Cover, provided it is the most appropriate cover for you (worth taking this opportunity to make sure it is actually!). Your original lender would need to 'release interest' in the policy before the new lender can note it on the new loan ('assign it'). It is always prudent to make sure it is 'assigned' to the new loan so that in the event of a death the benefit goes directly to the lender to clear the loan.

Also really important obviously to make sure there are no 'gaps' in cover if you are cancelling or replacing either the Mortgage Life Cover or the Home Insurance.....if something tragic were to happen during that 'gap' you could be left in dire straits!

Are There Another Other Options?

Your existing lender might well be able to do you a better deal than you currently have! You may not need to switch lender in order to get a better mortgage deal, saving you the time, hassle and expense which comes from moving to the new lender (documentation, solicitor fees etc). So if you have decided to switch it is always worthwhile contacting your current lender and telling them your gone unless they can do something similar for you!

So there you have it.......the 'can I', 'should I', 'how do I', 'what will I save' of the mortgage switch conversation.....do be a legend and share this with your peers and anyone who you reckong would benefit from knowing about this.

Thanks for reading, you're a legend!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to another episode of Ireland's #1 Financial Planning Blog & Podcast.

This week we have a cracking interview with UK's Jason Butler, where we discover some tips and guidance on achieving financial well-being, getting our lives the way we want them to be.

Jason has super insight on this aspect of life, and is now living his message.......most of us will hopefully take a few nuggets from this interview (I'm not taking any credit there!).

Be sure to check out our wee website, our why, and if you like the show then an iTunes review would be a much appreciated gesture to us.......You're a legend!

Enjoy,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we are aiming to share some slightly different insights, and reveal some major news in the world of Financial Services in Ireland! Last week the Central Bank released a proposal which is due to come into force next year (subject to Dept. of Finance), which is aimed at maximising the protection consumers get when it comes to buying any financial products....we have dissected all the Publications released by Central Bank to determine the details, and it's an interesting one!

Firstly, thanks for checking out Ireland's award-winning Financial Planning Blog & Podcast, we're delighted to have you join us. We'd be thrilled if you had the time to check out our 'why', and to learn a little about what we are trying to do, for you our reader.

The Green-Grocer!

Indulge us for a few moments, trust me it'll make sense shortly! Imagine that you are walking down the road after getting off your bus from work, and you notice a shiny new green-grocer shop on the corner. It's called 'Gerry's Independent Stores'...sounds good to you!

You walk in and the friendly green-grocer welcomes you with a big smile, a warm welcome, and inquires as to how he can help you.....you are taken aback at his hospitality and part of you reckons 'I'm gonna be sold something here'....therefore you reply in the usual way and state that you are 'just in for a look'!

The shelves are stacked high with produce, so much choice of all your staple items, different versions of everything......you are confused with the level of options and so ask for some help with regards picking the 8 items you actually do need, milk, bread, broccoli, ham, cheese, yoghurt, apples & grapes (you healthy divil you!).

Before you know it the kind shop keeper picks out a version of each of the 8 items, in addition he tells you that he has a special rate going on the eggs, asparagus, Mars Bars, and Ice-Cream and he encourages you to buy those as well. You reckon that you actually probably could use these other items so you agree to buy them.

You go to the counter, pay for your stuff and happily head on off home with your shopping for the next few days done, and away home to make the dinner!

How Did The Green Grocer get Paid?

It is only the next day that you hear from a mate that the Green-Grocer actually makes more profit on certain options than on others. He picked the options for you that result in him getting the most profit. He also invited you to buy more stuff, because it turns out he gets a large bonus from the provider of the eggs, asparagus, Mars Bars and Ice-Cream if he sells a certain amount of it. In fact, he actually also get a holiday every year if he sells certain amounts of it to his customers. He might also actually get support to pay for advertising and marketing if he agrees to only sell that particular producers product....how do you feel now? Some people might feel like that is what they expect, others might not care less, while others might feel that they were being encouraged to take and buy stuff that might not have been the things that they needed or wanted! Again, how would you feel?

How Are Financial Advisors Paid?

It will be no surprise to majority of you to hear that most Financial Advisors & Intermediaries, Banks, Brokers are paid in a similar way. Majority of Brokers, Banks & Advisors (also known as Intermediaries- i.e the seller of products on behalf of a product producer) get paid commission when they sell a certain product. It is also known that some get paid more for selling a certain product, and indeed get paid bonuses if they sell a certain amount of certain products from certain providers....all very certain!!

It appears to us that the Central Bank are on a mission to increase the transparency that you the consumer has in regards how your 'Green-Grocer' is paid by the providers. In fairness that makes total sense. As we keep banging-on-about here, the focus of the industry has for too long been lazered onto selling products as opposed to delivering the real outcomes that consumers need and want....more often than not a product is required, but it should not be the starting point of the conversation!

What Will Change For You, The Customer?

In essence what the Central Bank appear to be aiming towards is a situation where there is a full and clear menu available to the customer as soon as they look up the 'Green-Grocer' online....you the customer will be able to see exactly what the grocer is paid from each provider, in advance of you actually going into the shop.

The impact of this would be that the next time you go into 'Gerry's Independent Stores' you will know how much Gerry will make if he sells Brocolli A, Brocolli B, or Brocolli C.....again all about improving the transparency for the shopper.

Also, when it comes to mortgages, the Green-Grocer is currently paid a % of the loan that the customer takes out (Green-Grocer being bank/broker/any intermediary), so the more you borrow the more commission the grocer gets.....well they are looking to put an end to that it seems, by introducing a cap on commission which the grocer gets, irrespective of the amount being borrowed....again our take is that The Central Bank are aiming to reduce the chance of a consumer being 'given' more of a loan than they need, which would mean that the grocer gets a bigger commission. Them days appear to be at an end.

Is Gerry Independent??

As you have heard, Gerry's store is called 'Gerry's Independent Stores'......however if you are looking at how he is getting paid and the bonuses he can make by selling more product from a certain provider etc, then you could argue that he is not independent!

If the Central Bank's recommendations come into force in full next year Gerry will have to remove 'independent' from his store name! The Central Bank appear to be very keen to ensure that only a grocer who is receiving no form of commission from a provider can class themselves as independent. Meaning if you go to an independent store once these recommendations come into force that you will have to pay out of your own pocket for the advice and recommendations. If they do state that they are not chargin you commission but that they are charging you a fee, which is being paid to them out of your products, via the provider, this will be classed as not being independent from the provider, and hence not independent in nature.

How Can I Get Independent Financial Advice in Ireland?

In simpler terms only a grocer who does not take commission of any sort, whose only income is the income he or she gets from charging a fee directly to the customer, will be able to call themselves independent under the new Central Bank recommendations. That is quite different to what is and isn't classed as independent in today's world of financial advice! If you think about it it makes lots of sense to only allow an advisor who is totally, financially and otherwise, independent of the product provider to be able to call themselves independent......

How Will This Impact On Us Getting Financial Advice?

Some are saying that it might reduce the number of financial advisors in the country. Others are saying that financial advisors who typically have lots of providers to choose from will reduce the number of providers to just 1, so as to remove the need to choose between different ones based on something other than the commission. Others say that it will open consumers eyes to the level of commissions that are being paid, and will disillusion them about financial advice altogether.

The last point, from our perspective would be a huge shame. The benefit of true financial advice and financial planning is usually way way beyond the cost associated with it. The avoidance of huge mistakes, the putting in place of plans which support your long term goals and lifestyle aims is worth so much more than the cost, again usually! We, for what it is worth, hope that the impact will be the rise of much more customer focused approaches from more and more of the industry. If that happens, and much like the investment markets nobody knows, then the recommendations will have been a rampant success.

We're hoping.

Thanks for reading.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland's #1 Financial Planning Blog & Podcast. Our purpose is to help you make informed decisions with your money, and importantly to avoid some costly mistakes that they rest of us have made! We are aiming to make this THE home of Financial Planning ideas and insight for normal people in Ireland!

This week, after last weeks' cracker about clearing your loans at 32, we are back with a bang, and what more do we love than a good oul list! Which is ironic seeing as only recently I had the fortune to have attended a Workshop on using Mind-Maps....which suggest that lists are the devil's work and that our brains hate lists really. I have to say I am a fan of Mind-Maps now, I'm converted, so don't be surprised if I land a financial one on you all in the very near future!

It was actually doing a Mind-Map for myself that got me thinking about what is absolutely of most importance to me at the moment in terms of personal, family, career etc. It got me thinking of what we might say to an 18 year old version of ourselves, had we the chance to go back and give ourselves a right good talking to!! So here's my take on the 5 Simple Things I would encourage myself to have done financially from that age:

Be A Life-Time Learner: Personally I'm a little late to this party, only really getting into 'informational sponge' mode in the past 5 years. Had we forced ourselves as 18 year old's to read, and be curious about all things financial it probably fair to say we would be in a much better position financially than we are currently. So if you have found that you are still a little financially illiterate (you couldn't be if you are reading this right!!) then may I suggest starting with this book, a true gem; Millionaire Teacher.

Harness The Power Of Compounding: We have flogged this one to bits here at Informed Decisions but there is absolutely no escaping what Einstein referred to as the 8th wonder of the world. Imagine starting off at 18 years of age saving €250 per month. If you achieved a growth of 6% per annum, by the time you are 48 years of age this is worth €250,000, you yourself contributed a mere €90,000, the rest, €140,000 was magiced-up via compound interest....what possibly are you waiting for dear friend!

Become An Owner As Early As Possible: We believe that owning is much much more advantageous than borrowing. Take a home, for most us we need to be a borrower before we can be an owner.....the earlier you borrow the earlier you own (clear the friggin mortgage!). Despite the ups and downs of property value it is quite often clear to see that the sooner you can get onto that ladder, barring disaster, you may well stand to benefit earlier. The very same can be said of owning investment assets, be they property, equities, or other, it is much better from a long term returns perspective, to own as opposed to borrow, which you essentially are doing by owning Deposits Accounts!

Spend What You Have Left After Saving: Another that we beat the drum about here. Nobody enjoys the process of actually delaying gratification (usually!). Why would I save this money when I can out on the town tonight with my pals and have a whale of a time!?! By removing this choice from our hands we are ensuring that while still enjoying enough nights-out, that we also squirrel some money aside to realise our goals in the future, whatever they may be. It is so easy now to set up standing orders and savings accounts online that there is really no excuse not to, right now, go and set up a standing order out of your current account and into a savings account, the day after pay-day! Again, what oh what are you waiting for dear friend!? Most of the time people find that they can adapt to the new spending amount, so it's a win-win! And while you are at it I'd also make sure to know exactly what is coming in and what is going out each month....and to turn up or down the savings element whenever the situation warranted it...the art of budgeting!

Keep An Eye On The Small Print: So many people are swamped with jargon and terms and conditions when they do anything remotely financial related. Unfortunately it is usually one EU regulation or another that is insisting that you get this stuff. However the providers of these materials don't always make it easy for you to understand and digest them. One of the biggest culprits here is the fees and charges that you may be paying on financial products, savings, pensions, investments. These fees vary so so wildly from provider to provider that the difference between one and another can be a staggering amount of money.......make sure that that difference is in your pocket. Always always, as painful as it might be make every effort to know exactly what the fees are before you enter into anything......if you can't bring yourself to do it then ask someone for help!

So there you have it.....our 5 Simple Things....Simple but not necessarily easy....but hey nothing worthwhile is easy right!? However with a bit of knowledge and some good old fashioned effort we believe they are realistic, timely and above all hugely impactful for anyone to apply. You might want to send this or share it with someone who could do with the nudge!

Oh, and we are going to be introducing an element of 'readers & listeners questions' on the show every few weeks, so if you have any question you would like answered on the show just pop me an email here and I will do my utmost to include it in the next weeks' show and to answer it coherently!!

Thanks a mill for reading.......

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Welcome to Ireland's #1 Finance Blog & Podcast. We are here to help you make informed decisions with your money...and ultimately to bring true Financial Planning to Ireland's normal people!

This week we are taking a little peep into the magical world of Jimmy & Aggie.....how they have different views on life and money, and ultimately how they went their separate ways with regards their pension options, and how that panned out for each of them!

Aggie's Story:

Aggie is in her mid-30's, a sound woman by all accounts! She works as an Accountant in a medium sized law firm. She's as happy as a trout in her job, and plans on working her way up the ladder over the next 10 years in the firm. Good on Aggie! When she met her now husband Jimmy it was like a scene from a Disney Movie.....sparks were flying.....they were married within 6 months. That was 7 years ago now, and in fairness their gut feeling was right...they're having a ball!

Herself and her husband Jimmy have a wee baby girl, Jacinta, who is the centre of their universe at the minute! Even before Jacinta's arrival Jimmy had been at Aggie to start stashing some of her disposable income instead of spending it on more 'bloody cycling gear' (they are big cycle fans ya know!).

Being the loving and responsible sort she has given in to Jimmy's insistence and recently went to get some advice on getting herself a pension. Aside from Jimmy giving her the verbals about doing it she has read and noticed lots of articles and blogs about it over the last few years, generally scare-mongering her into doing one with headlines such as 'start a pension of die a penniless and miserable oul widow'...none of which really gave her the nudge to do one!

She met with an advisor, a highly qualified professional, also in her 30's. This advisor recommended that she should put in place the 'life-styling' option, which she was told will gradually move her funds from the 'volatile shares portion' of her pension pot to the 'more stable bonds & cash funds' as she gets nearer to retirement.

She is told that by the time she is 65 or so that 75% of the pot will be in 'steady and secure' cash while the other half will be in 'volatile shares'. Ultimately the intention would be to protect the hard earned savings that Aggie would have built up by that stage.

This sounds like a great idea to Aggie, she has heard one or two stories over the years of people 'losing' their pension pot as they get near retiring because of a crash or recession & she ain't a fan of that happening to her thanks very much!

Seeing this as sound advice Aggie duly accepts the recommendation and signs-up, starting off with a monthly payment of €300 to her PRSA. Based on the information that her advisor gave her when she gets to age 68 this should build up to about €200,000 after charges and accounting for the Lifestyling. As a result of reducing the % of your pot invested in funds which offer solid growth, it reduces your potential growth over time.

Fast forward 3o-odd years, Aggie and Jimmy are still blissfully married, their now 3 kids have grown up and left the nest educated and set up to go and do their thing! They are both eagerly anticipating their retirement and going to do all the things that they have been putting off for 30 years (you can see where this is going!!). Aggie has long dreamed of herself and Jimmy taking 6 months to cycle across America......a friend of hers did it a decade ago and she has been planning for it since. She reckons that trip alone is going to cost them in the region of €30,000, a fair chunk of her anticipated €50,000 tax free lump sum from her PRSA when she retires.

As luck would have it just as Aggie is turning 68 and about to cash in her pension pot the markets have a shocker.....a global financial crisis of 2007 proportions strikes....global equities fell in value by 50%. Luckily for Aggie only 10% of her total pension pot (€200,000) was sitting in an equity fund. It could have been an awful lot worse but because the bulk of her fund was in cash her fund value has only fallen by €10,000, from €200k to €190k, as she goes to retire.

At this point in time she is showering grateful blessings on the advisor she met all those years ago for recommending Life-styling. Had she not had Life-Styling she would have potentially still been fully invested in Equities, and therefore lost half of her total pot.

Aggie then takes her 25% tax free lump sum, squirrels the rest into an Approved Retirement Fund (Check this out if that means nothing to you!). With her €47k tax free lump sum she decides then to treat herself and Jimmy to a 1st class trip via Concorde (its 2058 now, Concorde has been reintroduced right!!) to the west coast of USA to begin their cycling adventures.....the rest is history!

On her return from the trip she decides to leave the fund 100% in 'safe' funds which offer no potential for growth but at the same time won't fall in value.....

So Life-Styling did a great job for Aggie here, it saved her large cash-pile of €200k falling in value by a full half just as she was going to retire.

So What Were The Benefits & Not-So-Benefits Of Life-Styling On Her Pension?

It protected her fund from falling sharply in value as she was retiring (cashing it in)
It gave her peace of mind knowing that the funds were being 'de-risked' as time went by
It reduced the potential for growth in her pension pot as time went by
If she stays in these low volatility funds she will likely be losing money versus inflation over the course of her retired years.
She will be paying fees to be in funds which are unlikely to earn any real return for her

So Let's Now Hear Jimmy's Story!

Jimmy was always smart with his money, he was reared with a prudent approach to looking after his money and was a diligent saver from early on in his career. When he set up his pension in his early 20's Jimmy decided to let the constant upward curve of the great companies of the world do their positive thing to his pension pot over the long term, and hence he decided to forego the Life-Styling option on his pension pot. He wanted to leave his funds exposed to the full power of a global equity fund over the long term. He was aware of the fact that volatility is your friend over the long term and so did not want to move the bulk of his money into cash funds as he got older.

Jimmy has been saving €300 into his PRSA since aged 25. Assuming the same annual growth rate as above, however this time without the impact of Life-Styling removing the potential benefit of growth, he will achieve a fund of €540k at age 68. (the power of starting early!!).

Like Aggie Jimmy is mad into the cycling. Loves it, however he doesn't buy all the gear, he rides a 10 year old bike, wears the same 3 bib tights and top for the past 5 years, and services his bike once a year himself.....the ultimate prudent cyclist...he prefers to enjoy his holidays, experiences, and saves the rest...hence his saucy pension pot going on!

As with Aggie lets fast forward 30 years. Jimmy's pot is worth a smoking hot €540k and he is licking his lips at the thought of the big 25% tax free lump sum of €135k.....and again because he is so prudent he is letting Aggie pay for the big US cycling trip...this money is to last him for another 30 years hopefully!

But of course, as you already are aware he suffers the same crash as Aggie (it's the same time of course!). Aggie's fund was well protected from the crash and the 50% equity fund falls however his wasn't, he was 100% in global equity fund, so you guessed it his fund falls from €540k to €270k, yikes! Just as well Aggie is taking care of the US trip.

So what does Jimmy do now? Well he has options....he can leave the funds there and let them recover. And here is the kicker ladies and gentlemen............the average period of time it takes the market to go from 'very bottom' (trough) to 'very top' (peak) over the last 23 bull/bear market cycles has been 1096 days, less than 3 years (based on our own calculations from Standard & Poors Corporation data).

This suggests that if Jimmy leaves the fund alone and lets Aggie look after things for a few years his €540k will be restored in full....and he can then go about taking his tax free lump sum and invest in his ARF/AMRF, and yes still continue to invest in the constant upward curve of the great companies of the world...happy days! Yes for sure it would have been a challenging time and one in which he would have had to resist the temptation to move his pot out of the rapidly declining equity funds and into the 'secure' cash fund, but that would have been the singly most financially costly mistake he would have made over his entire life, fact. Well done Jimmy for not doing that, for trusting the upward curve and for remaining optimistic.

The Benefits & Not-So-Benefits Of Not Having Life-Styling On His Pension?

It allowed his fund remain fully invested in the great companies of the world, accessing the growth they achieve over long term (good)
Allowing him move from working to retirement and the bulk of the funds remain in the same funds (good)
If the markets took longer to recover then he might need to access the funds, ultimately selling them at a low price (not good!)
He is exposed to the volatility, and the concern that that can cause an investor (not good if you can't handle it!)
He is avoiding having to pay high fees for investing in cash funds (which will cost him lots!)

So what's the moral of the story? Should I use Life-Styling on my pension funds? Should I remain invested in what are deemed to be high risk funds in my pension? Is Life-Styling a genuinely useful element on my pension and as part of my overall Financial Planning here in Ireland?

It really depends on your outlook, and on your capacity to ride the crash(es) when it/they hit. If you can do that then perhaps Life-Styling serves little of no purpose for you. In fact Life-Styling, while reducing your volatility as you approach retirement will potentially rob you of much of the gains to be had by investing in the first place....not forgetting that you will be paying in the region of 1-to-2% in fees each year just to be in the PRSA...so if you aren't achieving at least that then you will be losing money anyway- never mind also beating inflation over the long term! To do all that you could be needing to earn in the region of 4% growth per year to thread water!

As always we believe those who work with a competent and effective financial advisor/coach can do it most effectively, can resist the urge to make knee-jerk decisions based on temporary declines in equity values....in the history of the market all declines have been temporary, and that's another fact!

So if you plan to embark on an adventure of a life-time like Aggie & Jimmy did then make sure you know what number your current pension is likely to give you, and if Life-Styling is something which you believe will aid you or hinder you in getting to enjoy that adventure.

Thanks so much for reading.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

P.S: Thanks so much to Devined5 for our latest iTunes Review.......he/she called it a 'super informative investment podcast'.............thanks so much Devined5. If you would like to support us then an iTunes Review is a great way to do so....just follow this link

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This week we are chuffed to share with you the story of the guys at '2 Cup House' in USA. They were living the life of modern trappings, and one day decided that they wanted a different route.

It may not be for everyone but it is a great story that proves if you want to achieve something, and are willing to apply yourself if is often very achievable!

As promised in the episode there are a few snaps below of what their home looks like, and here's a link to their Blog.

Hope you enjoy the show, we certainly did!

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we will take a look at the empty promise that we hear so many people make to themselves and to their loved-ones! This empty promise is akin to playing Russian Roulette with your loved-ones' financial well-being.....if you are a selfish gambler then perhaps its OK, for the rest of us it simply isn't, no matter what hat we're wearing!

What in the blue-blazes are we talking about? We are talking about the gamble we hear so often, whereby a couple are taking out a new mortgage, and when faced with whether to put in place just the Mortgage Protection, or to comprehensively cover themselves by taking Mortgage Protection as well as an element of Personal Life Cover. Many many people make the empty promise when they say "We'll do the Mortgage Protection now, and sure we'll do some sort of personal Life Cover once things settle down".....that is a "I'm happy to gamble with my families financial well-being" if ever we heard one!!

In this episode we are going to initially look at the basics of the two types of cover....just so we're all on the same hymn sheet! In a few minutes we'll then dissect the merit of the advice to pay for both Mortgage Protection & Life Cover. We'll uncover if having both is as useless as a chocolate fireguard, or if it is actually a prudent and necessary approach to take when it comes to protecting your yourself and your family, and indeed your financial plans here in Ireland.

Firstly, and as always, we are chuffed that you have checked out our award winning Irish Financial Planning & Money Management blog & podcast. We are on a mission to make financial planning accessible to Ireland's millennials! We ask for your help to spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! Be delighted if you checked out our why.

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Welcome to our 61st edition of the informed Decisions Financial Planning Blog & Podcast. Did we mention we were recently voted Ireland's best?? Yes, we are Ireland's #1 Finance Blog & Podcast...!

To celebrate our 61st Podcast we are joined by the one and only Emma Kennedy, journalist & up to recently Editor of Money section in Sunday Business Post.

We get to explore Emma's thoughts and experience in regards lots of topics, Kids & Money, Mortgages, Pension Reforms and the make up of Financial Planning services in Ireland as of today.

We do hope you enjoy this episode, we certainly did enjoy creating it! If you have any questions please do drop us an email, and if you really do enjoy the show we'd be hugely grateful of an iTunes Review!!

Thanks so much for checking this out.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Two lads were standing at the bar of a Friday night in October....their kids put to bed, they gather for their monthly 'Fischers Friday' in their local pub!

Lad #1: "Hey, they're telling me I should do this AVC pension in work"
Lad #2: "Whats an AVC?? Sure do you not have a pension already in work?"
Lad #1: "Eh, yeah I do yeah but yer one said I should set up this other one to give me more of a lump sum in 20 years!"
Lad #2: "Sure jaysus you could be dead in 2, whats the point in doing an ABC or AVC or whatever it's called?!"
Lad #1: "Yeah but she said that if I don't do it i'll miss out on a load of tax reliefs or somethin"
Lad #2: "Tax relief me eye, sure if you put it all into the ABC thing you'd not be able to afford these pints your about to buy!"
Lad #1: "Ha! But yer right, sure yer one was only trying to sell me stuff I suppose"
Lad #2: "Damn right she was, them ones are all the same, pushy pushy, only interested in themselves, ya may tell her to shove her ABCs!"

This wasn't our attempt at a Roddy Doyle sketch, moreso our interpretation of what we believe probably crosses people's minds when they are invited to look at AVCs! They might not verbalise it but they probably think it.....and to a degree they wouldn't be totally wrong!

This week we were contacted by one of the national papers for our comments on AVCs; the pros and cons as it were. We gladly gave our views, and though it wasn't on the agenda this week we decided to do a piece on AVCs.......it's over-due in fairness! We are hoping to dig into the ABCs of AVCs a little, keeping it simple and looking at it slightly differently, as we do!

So how about we look at that wee conversation above and take it line by line, figure out how right or no they are! Before we begin, in order for an AVC to be of any appeal to you, you need to have A) an understanding of what it is B) clarity on how it will benefit you (or not) in the long term & C) the disposable cash to put into it!.............................................www.informeddecisions.ie/podcast59

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OK, we were being a bit mischievous in calling it 'owning'.....but if you have one you'll know that the responsibility lies squarely on your shoulders.....so you may as well 'own' the little darling!! We are not just gonna list off the usual baby stuff, as we like to do here we are going to invite you to think about it a little differently! There are stats which say it costs €250k to raise a child. We're gonna bust through that and break it down a bit more practically!

Many of our readers have kids, and indeed a lot do not, yet! In this episode we are hoping to give some bit of insight to readers on what can be expected financially when you are expecting & beyond.....

This episode is a major departure from the last few weeks where we focused on investment rebalancing, investment portfolios and the impact of time on your investment success. So if it doesn't hit the mark for you then please let us know!! Feedback is gold!

Firstly, and as always, we are chuffed that you have checked out our website & podcast. We are on a mission to make financial planning accessible to Ireland's normal folk in their 20s & 30s (millennials!?). We ask for your help to spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! Be delighted if you checked out our why.

This episode does not address the costs of trying to conceive and the various medical methods to do that. While this is something which is faced by many many couples, we empathise however we really don't know enough about it here to put together helpful information.

Intro:

So if you are expecting or indeed planning on expecting a wee baby and are wondering how much does it costs to have a child, you are a planful individual! We reckon it is useful to approach this question through 3 different 'trimesters' (like what I did there!?).....the short, medium & the long term.

The short term expenses include everything in the run-up and indeed the first year or so of the child's glorious existence, medium term is from year 1 to year 5, while the long term is everything after that! Let's take a quick look at the main costs of having a baby, on the short term.....

The Short Term:

You don't need us to inform you that there are costs associated with having a baby even before he or she gets here! Here's a broad summary of what you'll be looking at!

Medical Costs: Ranging from €3k to €5k if you decide to use the 'Private' maternity service in your chosen hospital. If you decide to go 'Semi-Private' it will be in the €1k to €2k region, while if you decide to go 'Public' you'll be getting it for all but free. The decision as to which route to go is a very personal one, and in most cases doesn't come down to cost anyway!

There's not too many mammies who would be happy to let a baby arrive home without having all the necessary accouterments! So broadly speaking here's a broad tally of the main bits needed;

Cot/Crib/Changer: €300-€1000

Clothing/Blankets: €200-€500

Buggy/Car Seat ('Travel System'!): €300-€1500

Breast or Bottle Fed: €0- €600

That quick scan (pardon the pun) of the short term costs tells us that you'll need to prepare for spending anywhere in the region of €800 to €8,500, depending on your preferences....and indeed on how many 2nd hand donations you are willing to accept from friends and family (a great source of stuff in fairness!).

Medium Term (1-5 years old):

So baby is home and settled at this stage, and is starting to crawl/walk and give you back-chat! Happy-Days!

As a responsible parent your instincts will likely kick in and make you notice the advertisements and media articles, forcing you to consider such things are making sure you have proper financial protection & provision if 'anything happens' you!

Emergency Fund:

This nugget has been covered umpteen times in fairness. We even covered it way back here in our 3rd blog post. You may already have one in place, but if you don't it can seem a really daunting mountain to climb....to have a stash of cash equivelant to 3-12 months take-home income. So if you are taking home €3,500 per month, you could be aiming to have €10-€40k of a stash! That's no mean feat but the comfort and peace of mind knowing it's there (or at least is being built) is massive. Follow the suggestions here and you should be OK on this front.

You'll Wanna Be Protected:

Again, your instincts will probably drive you to take notice of all the countless ads for Life Insurance. It is our instinct for survival (and for the survival of our 'off-spring) that motivates us to take this stuff in the first place.....so you'll likely feel the twinge to do something here.

The thoughts of not having it and 'something happening' is far worse that the thoughts of paying for this insurance. Or at least it is for 50% of the parent population in Ireland anyway - that's the rough % who have Life Cover in place!

If you are wondering 'how much life cover should I have' then by all means you can check out this bad-boy here for an idea of the level that would be sensible, and indeed for the different types that are available to you.

If you are particularly planful and your instincts are kicking your backside you might even start to wonder should you have some form of illness cover or indeed an income protection. These insurances all cost money, nobody likes paying for them, but generally people love the peace of mind they provide and the fact that they quieten the nagging instincts! This episode on Income Protection and this episode on Specified Illness Cover might help a little.

Child-Care:

If you take a scenario (which is by far the most common) where both parents are back to work within 12 months of baby's arrival then the inevitable cost of child-minding will rear it's ugly head! There are obviously scenarios where grandparents etc mind the child and insist on not taking any money for that. Count yourself fiercely lucky if that's the case!!

A local childminder or indeed creche, depending on where you are in the country will cost you anything from €40 to €60 per day. Might not sound a lot, but tally that, averaged at €50 per day, over the course of a month, if it is 5 days per week, and you are at €1080 per calendar month. €12,000 per year. To earn €12,000 as a higher tax earner you need to earn approx €24,000 Gross.

If you are on €60,000 per year that is not far off half of your yearly Gross salary...or in another way nearly every second day you go to work is so that you can pay Childminding costs! Not exactly inspirational stuff I understand, but it is a fact!

Taking Time Out:

This leads nicely to the next aspect we invite you to consider, in advance of baby's arrival. Will you actually want to go back to work after maternity/paternity leave is over? Will you be able to afford not to?

This is the single biggest aspect we would invite new or prospective parents to consider. Aside from the financial cost of reducing hours or indeed of doing no hours of paid work, there is the far more important and fulfilling (we would argue!) aspect of having extended time with your child in their early years.

If you were to take unpaid leave from work would your financial lives fall to pieces? How would the mortgage or rent get paid? How would all other bills be managed? Have you actually looked at the maths yourself? This is essentially what Financial Planning is all about, looking ahead and figuring our what you want to do with your time, as well as with your money! We saw how much of a dent on your salary that Childminding can have....you would obviously be saving yourself that chunk if you were not working and were doing that yourself!

If your married couple have only one earned income between them, as of January 2018, that household will be able to earn €43,550 before being hit with the higher rate of tax. In essence what this means is that the effective rate of tax on the household income would obviously be less if only 1 person is earning an income, meaning the 'worker' would find they take home more Net Income if the other spouse takes time out.

Taking time out is not obviously a necessity, it is a choice. We invite you to consider if this is a likely choice you want to make, and to plan for it if it is something you aim to do.

Long Term (6 years and beyond!):

Aside from feeding a growing child, and aside from everything above and the usual clothing, social, sport and other expenses the most commonly thought-about is Education. While the expenses of National and Secondary school appear mostly manageable to working parents, it is the looming 3rd level education which causes most parents to squirm!

We have covered it before, the most common ways to prepare for the costs of college fees. Indeed it was such a big subject matter that we had to split it into 2 parts, Part 1 & Part 2!

If you have young kids at this stage you might feel that College fees are a long way away, and you'd be right. Having said that unless you have the money already set aside for it (€11k per year per child) now might be a good time to start figuring out how you are going to pay for it all!

Nonesense:

As much as we love the topics we cover here, and sharing ideas with like-minded people to help them manage their money the idea that you will or won't have kids based on the financial aspects is a little 'off' if you ask us. Yes it is prudent to be prepared and planful but for those of us who are lucky enough to be able to have and care for their own child it is our primal instinct to create and give another being the chance to live a fulfilled and fun-filled life.....money is unlikely to come into that debate....it may, but it will unlikey be the decider! So take all of these articles about the financials of kids with a pinch of salt, take what nuggets you like from them, but please don't let it scare you, you'l be awesome!!

Thanks a mill for reading (and sharing). We'd love you have you join our community.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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This week we take on a subject which, while not that earth-movingly exciting, has gained in popularity over recent years in the investment industry, and that subject is rebalancing.

Rebalancing, in the simplest and most honest terms can be described as taking money out of your 'winners' and putting it into your 'losers'! Please bear with us and we'll explain!

With lots of lovely head-lines lately talking about Equities at all-time highs and general euphoria about investing.......it might (or might not pay) to be aware of rebalancing, and how it impacts on your investments.

When it comes to Investing & Pension Funds in Ireland in 2017 or indeed most aspects of creating investment portfolios, since 2008 there has been a sharp focus on ensuring that investments are well diversified. Due to the scorchingly severe falls in values of equities and property at that time people have been once bitten and are now twice shy. There is now a big push to diversify between different asset classes to reduce that volatility & who'd blame them.....even though it this does fly in the face of the fact that a broadly held basket of equities outperforms any other asset class over the long term!

Product providers and indeed the industry at large now go to great lengths to encourage people to avoid being overly exposed to one particular asset (even if, as already stated, historically one particular asset class has performed above all others!). Investors are now encouraged to have a balance of 2 or more asset classes, such as equities and bonds, or equities, bonds and property etc etc. This is done ultimately in order to try reduce the volatility yet still achieve reasonable returns. For more on diversification by all means this might be useful (or not!).

What is Rebalancing?..............by all means check out our blog version of this episode.....here.

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While it might sound a little like a project to build the next NASA space-rocket this is a fairly simple investment approach that Irish investors have access to, so strap yourself in! Before we begin may I outline that the word 'satellite' is one of those words that I really struggle how to spell.....for some reason I keep typing it as 'satelitte'.......so this particular blog might take me a while to get done!!

Anyway, here we will take on the task of sharing ideas with you keen investors on the concept of 'core-satellite' investment portfolios, how to approach it, what to watch out for and ultimately outline the pros and cons of this particular approach. Lovely-jubbly. Core Satellite investment in Ireland will never be the same again!!

What is a Core-Satellite Portfolio?

Core-Satellite is not something you might hear often here in Ireland, however elsewhere in the world, such as US & UK, it is a very well established and indeed popular approach to take to investing your funds.

Ultimately this approach aims to blend the 'best of both worlds', by combining both Passive and Active strategies into the one portfolio. There has been long term debate over which strategy is best for investors. A recent well documented event was Warren Buffet winning a 10 year, 1-million dollar bet with a hedge fund manager that a passive fund would beat an actively managed hedge-fund over 10 years from 2008. To date the passive fund has delivered over 7% while the hedge fund has delivered just over 2%........it was a land-slide. Yet there are periods where an active fund manager has outperformed passive and indeed been able to reduce volatility levels at certain times and in certain markets. Find out a little more about active strategy in our hugely popular interview with Will Spark here.

As a result of this ongoing debate people who are unsure of the long-term best option for them can avail of a 'bit of both' styled approach. That is where core-satellite comes into play, and satisfies that need.

How To Build A Core-Satellite Portfolio?

A portfolio is just a fancy way of saying, 'a mix of investments/holding'. Its one of these words that sounds nonce, it's straight-forward however! You can create a portfolio with a trusted advisor (our default recommendation!) or you can build one yourself and attempt to manage it over the years directly with an investment firm or online trading. You simply purchase the appropriate funds/holdings and re-balance it each year or so (we'll have an episode on what re-balancing is all about very soon!).

Provided you have set up your portfolio (mix of stuff!) in line with your appetite and tolerance for volatility and indeed your long term objective there is no need to ever alter the portfolio. If your long term plan doesn't change then there really is no need to change the mix.

In any core-satellite portfolio there will be a certain percentage in Active and a certain percentage in Passive. The core will naturally form the basis of the portfolio, while the satellite represents the add-ons to the core.

What To Watch Out For?

The split should be based on a number of considerations, including but not limited to the following:

Investor tolerance for volatility

Ability to identify top performing and low-cost Active Managers

% Return needed to achieve the end goal of investor

There are many who would argue that Passive holdings such as Index Funds should form the basis of the core, that historically this offers the greatest return over the long term relative to the risk and volatility. The satellites should be a combination or small selection of managed funds, to offer diversification from the core and a potential to offer growth/stability/selection in preferred investments. Unless you or indeed your trusted advisor are skilled at identifying low cost and high performing Active holdings then it may be a case that having these smaller holdings in your satellites might make some sense.

Others would argue that the Core should be more boring and less volatile investments (holdings), where it is risk-managed and relatively steady, in order to try deliver a certain expected long term return. This would offer scope to go for more exciting and volatile satellites to attempt to drive performance upward. This would, or indeed should, lend itself to more predicable returns over the long term, albeit likely to deliver less return than the above example.

We've said it before and we'll say it again, begin the construction of your portfolio with the end in mind....what is the objective of it, what are you aiming to achieve, what are you willing to accept in terms of volatility in order to achieve it. The questions, or more-so the answers, should be a large determinant in building and choosing the percentages in each.

As a general guideline if an investor is building a core-satellite portfolio typically the core would represent at least 50% of the overall value, the remainder split between one or many satellite holdings.

If you are into Financial Planning and want to be more mindful in your investments then the idea of investing with a particular investment philosophy and plan is a must....otherwise it is purely investing for the sake of it...and that usually doesn't end well!

Irrespective of whether it is Active or Passive it always pays to be aware of the costs of the funds, getting access to the Total Expense Ratio (TER) or the Ongoing Charges Figure (OCF). For more on the impact of fees on investment growth go here.

Pros & Cons:

In short the pros are that it allows you access to both Passive and Active in a structured manner within a single investment portfolio. It makes it easier to monitor your split between the two strategies and to therefore re-balance it each year to keep it in line with how you initially set it up.

Some of the cons one would see are that it can be difficult to keep a clear line of sight on the overall portfolio it if there are many smaller satellites. It can therefore also tempt an investor to make changes to the portfolio selling and buying satellites irrationally, which more often than not will have a negative impact on it's long term performance.

Bottom-Line:

Core Satellite is a form of portfolio investing. If you are interested in a blend of Active and Passive this approach can make a lot of sense. If you are strongly biased toward either then it can also be a sensible approach to still keep an element of the one you less favour, as always it can add another level of diversification to the portfolio and offer growth/risk-management depending on the blend you opt for.

If this is new to you you may well now think that Core-Satellite seem like a complex sounding name for a fairly straight-forward approach, and you'd be right, it is! However the clearest benefit from our perspective is that it provides a structure around which to build a sensibly constructed portfolio.

Thanks for checking out this episode, and by all means we'd love you to join our growing community of 'informed-decisioners' over here!

Thanks for sharing.....

You're a legend!

Paddy

QFA | RPA | APA | Qualified Coach

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It is the first thing people ask when they hear you work in the space of helping people manage money.....'What should I invest in?'. The only appropriate answer to that question, I believe is along the lines of 'it depends on what your objective is'. This answer usually isn't what they expect, they expect a pitch for a certain share or investment in a German Shopping Centre Fund!

The next question that follows will usually be....'How long should I invest for'? That is the question we are here to discuss. And for once I have had the time to write a short piece, so enjoy!!

Firstly, and as always, we are chuffed that you have checked out our website & podcast. We are on a mission to help Ireland's normal folk to make the most of their financial lives and make Financial Planning accessible to all. We ask for your help to spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! Be delighted if you checked out our why.

As always we're totally upfront when we say that we are openly biased on this little topic!.....We believe it is a simple concept that costs nothing and that no other tool, process or approach will have as significant an impact on your ability to be a consistently successful investor, as time.

How Long Should I Invest For?

This is a non-question, deserved of a non-answer! If you are really beginning with the end in mind you will know how long you plan to invest for, you will know why you want to invest and with the assistance of a true financial advisor will know what level of return you need to achieve to ensure you meet your goals. But forgiving that let's looks briefly at the 3 timeframes which might be considered 'normal'.....

If you are constrained to an investment shorter than 5 years and you wish to invest in anything like Equities or Property funds then you are absolutely gambling. Best of Luck!

If you are in a position to invest for between 5-15 years then you are in reasonably positive shape for making a success of it, not quite a thoroughbred of investment but pretty close!

If you are open to and indeed fully committed to investing, and leaving it invested for 20 years or more then you are, if over 100 years of history is anything to go by, as close to a bookies 'cert' as is statistically possible!

What Does History Tell Us?

Well interestingly enough you will see from below chart that on any given day the great companies of the USA (The S&P 500) are a coin-toss as to whether they will be up or down. It is this fluctuation that all those media articles, blog posts & Bloomberg-esque TV programmes feed on on a daily basis. But sure what possible difference does that make to the a 20 year investment plan? None.

If you invest for any 12 month period you are more likely to end up than down. However if you invest over a 15 year period you would expect to experience a negative return once in every 500 rolling periods. The return would be positive 499 times and negative once!

Over a 20 year period, it has not had a single 20 year rolling period (with a new period starting every month) there has never been a single period where the return has been negative.

Speaking of 20 year periods, the worst 20 year return was 54%, however the worst 30 year return was 854%!

We can deny it, dissect it, counter it and challenge it all day long, however the fact of the matter is that these are facts, and facts we don't often hear. My guess is that it is because there are lots of advisors selling products, with no awareness whatsoever of the actual market and historical facts.

Where Do People Go Wrong With Investment Durations?

It is a natural instinct to keep a hold of accessible cash, quite right. Indeed it'd be tantamount to madness to invest money into a similar asset as above without having a 'stash' that they could access for short-term needs or emergencies.

Outside of that however it is tantamount to madness to not preserve the purchasing power of your money and to leave it on Bonds or Deposit for the long term irrespective, of your age.

One of the core problems I see is that many investment funds accessible to Irish investors have recommended or indeed minimum time-frames. These are usually 5 to 7 years, and set as a result of product constraints or need to extract enough fees to cover the cost of selling that product to the investor! Unfortunately this timeframe can now become the target, to leave it there for the 5 years and then take it out. No No No!

If you are indeed entering the investment with a plan, with clarity on the return you want to achieve and the outcome you are aiming for, please don't have 5 years as your target, give yourself a much higher probability of success and 'go long'.

If you did find this useful please share, love it to bits and send me an email saying why...if you thought it was rubbish please send me an email and tell me why!

Thanks!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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There are many many people today in Ireland pining for their own home, looking to get onto the property ladder, sick of paying rent or perhaps living with parents or family. There are usually a one or more of the following barriers to them doing so; cannot get a mortgage large enough, cannot find a suitable home in the location they want, or they are waiting for the 'next property crash' before buying.

This last barrier is an interesting one, and indeed one which many many people of our generation are asking themselves; should I wait for a property crash instead of buying a house now. Recent property price increases are well documented, as are the issue around supply etc....we are not here to discuss these. What we are aiming to do is separate the financial from the emotional when it comes to these decisions.....because let's face it, whether we realise it or not that is often the dilemma!

How Do Property Prices Compare To 'The Peak'?

How prices compare to the past is a non issue, it is not a determinant or a predictor of any future event. However this is ultimately what is encouraging people to sit and wait for the crash......it's the recency of the property crash of 2008-2013, where prices of houses fell on average of 55%. With this so recent in memories one could not at all be blamed for being keen to avoid such a burning again. Let's face it who would volunteer to pay €300,000 for something only for it to be worth €140,000 five years later....!

A typical 3 Bed-Semi in County Meath in Jan 2007 was in the region of €315,000 (knowing from personal experience!). Those same houses fell in value to approximately €140,000 by 2013, after which point they begun to increase in value.....currently standing at around €260,000.

Similar value fluctuations can be seen right across the country, falls of 55% over 5 years and then increases (from that low point of approximately 60-70%), but they are generally not back to the 2007 level, despite media coverage stating that they are. So does that mean you should wait until they hit the next peak, let them fall and then buy?? Lets see what would need to happen...

Wishing For Armageddon?

So you and your partner have two decent incomes, both in steady jobs, have been saving €800-1,500 per month for the past few years, have €40-€50,000 squirreled away in a savings account with your bank or credit union..........you have observed the price of property rise in the region of €2,000 per month, and you are saying to yourself 'here comes the boom'! With that mindset, you will hold and hold until the next 'correction' comes.....when will that be?

Nobody knows, it could be 5 years, it could be 10 years, it could be 15 years.....and how much will prices fall? Could be 10%, could be 25%, could be 50%, nobody knows! The bottom line is that if you are waiting (and therefore hoping) for prices to fall in the region of 30-50%, the fact is that this may never happen. You may well find that you are still saving in 10 years time, you might have €200,000 built up, but then again the price of that €280,000 house in 2017 may be €520,000 in 2027! Do you buy then??

We are all in favour of beginning with the end in mind here. What have property prices done over the long term? The long term growth rates of property value, as captured by Ronan Lyons in a study of a few years ago showed that prices increase at an annual inflation adjusted rate of 2-5%, and no more, on average.

What Would Have To Happen For Prices To Fall 50%??

This is an interesting one. If you are that couple with a nest egg of savings waiting for the next property crash it's worth considering what that might look like! And while we are not economists here at Informed Decisions, we do believe that if property prices are to drop by 50% it will impact more than just property.

Look back on 2008-2013. Without getting too dramatic about it unemployment rate rocketed from 4% to 15%. Many decent folk just like you lost their jobs and their incomes fell to nothing. There were very few jobs out there unless you were super skilled in certain technical roles. There was catastrophic problems with the financial system, taxes increased on those who were working and large shortfalls in government cash-flows needed to be plugged by Europe.

The impact of this and indeed many other factors was that banks essentially stopped lending! When they did lend it was only to the most 'gold-plated' of customers, those with impeccable savings, employment and credit records....they didn't lend to you if your job was in jeopardy or indeed gone!

While not suggesting that you as an individual would lose your job if property prices fell dramatically in the future, it is realistic to expect a potential impact on income, and indeed on the ability to borrow what can now be borrowed. For instance a couple with combined incomes of €110,000 could expect to be able to borrow in the region of €400,000 (based on the salary only and nothing else). If there was another major 'correction' would that €400k be borrow-able.....who knows!

Worst Case Scenario:

So if you are in the position where you are ready to go, and are holding off for Armageddon to strike and prices to plummet. Other than the possibility of your dreams not coming through, lets say you decided to buy a home now. Imagine you borrowed €315,000 and bought that house for €350,000 (90% mortgage!). Property prices grew by 5% per annum for the next five years. In 5 years time your property is worth €440,000! Happy Days!

Lets assume Armageddon hit in 5 years time - that's a random selection not a prediction!! Over the following 3 years prices fall by 50% nationwide. The economy is in a spin, everyone is saying 'this is the end of the world!'.

Absolute disaster?? Your house fell from €440k to €220k over those 3 years. At this point, 8 years into the term, your mortgage balance is €256,000! Yes it's negative equity but so-the-hell-what!!! Does that negative equity have any impact whatsoever on your lifestyle or indeed on your financial wellbeing? It may indeed feel bad, nobody likes to be repaying a loan on something that is more than it's value. But other than that emotional aspect it has no bearing on your financial position.

It is only if you needed to sell it would be an issue. In addition we have seen since 2013 how the price of property can recover over a 4 year period given the right circumstances. Prices have almost doubled from the low point of 2013......meaning that in the above scenario the property would increase in value from the low of €220,000 back up to €440k territory, and by that stage (12 years in) your mortgage would be approximately €220,000!

If prices didn't recover, assuming you continued to be able to repay your mortgage you would be out of negative equity within that 12 year time-frame.

Separate The Financial From The Emotional:

While we do hope we have outlined the above fictitious scenario in some sort of clear manner it may all still seem a baffling consideration to make! Financially speaking buying a house is a gamble, no 2-ways about it.....you are making a huge investment at a particular point in the market. If you were an investor I would be advising you to insist on huge diversification not to invest 100% into one thing, not possible when buying a home unfortunately! Whether the point you buy-in is high or low relative to the future prices nobody knows, and that is a fact.

Emotionally it is often a solid investment. You want to put down roots, you want to be able to call it your own, you want to be able to have a 'roof over your head' that you own (theoretically anyway!).

If you can financially handle the potential armageddon, and emotionally you think you could stand up to it then it may well make sense to you to commit to your new home.

We hope this provided food for thought. As someone who previously bought at a peak we understand how it can feel, and whether or not it financially impacts. Our aim is that this piece will hopefully help you indeed a loved-one....so please do share the love!

Thanks,

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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It's Showtime!

If you swim too close to a shark it'll bite ya! If you have decent savings, investments and pensions you could be in danger of getting bitten too! We're here to help you understand if you are in danger of getting bitten, it's up to you as to whether to stay in that water or not!

We are realists here at Informed Decisions and so no matter what you get done; a tap fixed, a wall painted, a tooth pulled, a will administered, a house bought or indeed an investment invested you will pay a price for those services! This episode it aimed squarely at ensuring you know the impact of any fees you are paying on your financial products, wealth management or indeed retail investment products here in Ireland. We'll also share some insights on what you might be able to do to help yourself avoid a nibbling......because ultimately controlling your costs is a smart thing to do!

Firstly, and as always, we are chuffed that you have checked out our website & podcast, and we ask for your help to spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! Be delighted if you checked out our why.

Click here to access the full show notes version.

Thanks for listening & sharing!

Paddy Delaney.

QFA | RPA | APA | Qualified Coach

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Thanks for tuning in to this weeks' Episode, our 52nd, and Informed Decisions' 1 year anniversary!!

We bring you something pretty special, interviewing one of Ireland's brightest talents in regards Investment Management, Will Sparks.

Will tells it like it is, so it was a pleasure to have him on the show, and in addition to that he knows how to manage investments....who better to help identify some insights for our listeners!

By all means please do visit our small website, and check out all our podcasts and blogs, and if you like what you see we'd be delighted to have you join our mailing group!

Thanks all.

Paddy Delaney

Creator & Dogsbody @ Informed Decisions!

QFA | RPA | APA | Qualified Coach

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Hey!

In a recent blog we took a look at the big 6 risks which exist when it comes to managing ourselves and our money. We had everything from ostrich risk (sticking our head in the sand!) to longevity risk (living too long!).

This time around we are going to focus on practical tools we can apply to our money and savings, in order to ultimately have a more pleasant investment journey, the growth we expect, and the appropriate outcomes......please keep reading!

As we try do things slightly differently here at Informed Decisions we are going to attempt to explain all this using the metaphor of a plane journey to New York.....chocks away!

Before we fly off into the blue yonder, if you enjoy this blog, all we ask in return is to help us spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! We are on a mission to make Investing and Financial Planning here in Ireland a doddle! Be delighted if you checked out our why.

What is Investment Risk?

Some say (indeed the 'Economic Times') that it is the probability or likelihood of occurrence of losses relative to the expected return on any particular investment.

In plain english therefore we can take it as the risk of your investments not doing what you expected or indeed hoped. Comparing it to a flight it's like (I would use the work akin but it sounds horrid pretentious no!?) getting on a flight from Dublin heading for New York to do a huge shopping spree but ending up in Mexico! You expect one thing but get another, and you may not be that happy about it!

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Hey all, in this 50th episode of the Informed Decisions Financial Planning Podcast we will aim to share insights on the very best mortgage that you can get here in Ireland; whether you are aiming for your first mortgage or have a collection of them we hope to share ideas which will save you a small fortune over your life-time. We also have a short guest appearance from Seamus & Conn (future Informed Decisioners!!)....

All we ask in return is to help us spread the word, share the article with the little icons at the bottom, check out the podcast, and in general just be a huge fan of our little site! Be delighted if you checked out our why.

We shared insights a number of months ago in what still remains one of our most popular blogs in the area of over-paying one's mortgage and the impact that has on the number of years you will be lumbered with it and also the lump of interest you would have paid.

Speaking of which, if I was to offer you €38,000 of a saving over the next 20 years, and all you had to do to earn it was about 8 hours of work, and an initial outlay of €1,000 to €1,500 for solicitor fees......what would you do? Many of us might fall into the most irrational behavioural finance phenomenon and not be able to see past the cost of €1,500, but on the face of it there surely is no doubt that we know it makes financial sense, right??

Take a listen to find out what we are talking about this week!

Thanks a mill.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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We are joined by Professional Coach Niall English, to uncover exactly what coaching is, how it can be of benefit to us in achieving the things we want to achieve.

We also take a look at how it might be useful if you find yourself in need of making some changes to your finances. Here at the home of unbiased financial planning in Ireland we like to bring some fresh ideas.....this is our latest!

Plus, Niall shares some practical tools we can all use in order to make some real improvements in regards to our finances.

Hopefully you enjoy!

If you do then please share, join our community and spread the word!

Thanks a mill.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Hey, welcome to the latest Episode......This week we follow-up on our promise to share with you guys how ETFs are taxed here in Ireland. Like a lot of stuff these days there is a lot of info floating around about this topic, and if any of you have gone looking to get definitive answers it can prove quite tricky. We aim to bring several years of research to you in this episode, to answer most of the common questions that arise (and accept that we will naturally miss some of the less common stuff - who doesn't!).

Now this may help some of you, and it may not help, but understanding how you are taxed on your investment, pensions, savings or nest egg in Ireland is fairly vital in making informed money decisions...speaking of which please do pop over here to find out why we exist, what our purpose is and why we are Ireland's first Financial Planning & Wealth Management Blog & Podcast. Also, if you have any questions or comments we'd love to hear from you, just drop a message to us here.

In Blog 39 we took a fairly deep look at ETFs, how they work, how to buy them and what to look out for. We also raised a rather large flag to warn potential investors of the way in which 'the revenue' here in Ireland tax any income or gains you make on profits from these investment types. We are gonna address that now. We are not encouraging people to invest based on the tax treatment of something, that's never an informed decision, but we do believe it an important factor. First lets summarise the benefits & limitations of ETFs for Irish Investors:

Perceived Benefits (see blog 39):

Offers a transparent means to invest in a broad range of companies with 1 'share'
Potentially lower fees in comparison to shares and other retail investments
Typically 'sellable' on the day you want to sell and get your cash back (liquid)
Access to invest in large geographical areas (e.g US/Europe/Asia/Global)
Easy means of diversifying your investment within shares/stocks

Perceived Limitations (see blog 39)

Typically only investing in equities and not other asset classes
Generally no volatility control in place - if it falls it falls - if it rises it rises
Confusion over how they are taxed here in Ireland
No physical proof of ownership - no share cert - all electronic/online
Some ETFs are 'synthetic' - opening them up partially to potential default (counter-party risk)
Lack of understanding of what they are and how easy they can be to own

Other Investments:

We have covered it before but if you were to buy shares directly in a company, such as Bank of Ireland or any other stock listed on the Irish Stock Exchange (ISEQ) then it is all fairly straightforward:

Buy the shares through share dealer/broker (e.g Davy/GoodBody/IG etc etc)
Pay Stamp Duty (1%) & all other expenses of dealer (dealer collects these)
Get Share Certificate - you now own the shares
Pay Annual Mgt Charge (typically 1-3% per annum) & 'other fees'
If you get dividends you declare this and pay your margin rate of tax on that income
When the time comes you sell the shares & pay your Capital Gains Tax of 33% on any growth you achieved (above €1,270 per annum)
Bit Messy!

If you were instead to go and invest your money into a retail investment product, which a lot of the banks/brokers/agents sell, you are buying what is officially an 'Irish Insured Investment Fund'. These products offer you the option to easily invest into a variety of assets, depending on the fund it could be equities/ property/ commodities/ cash/ bonds or a combination of these. In this instance:

Invest the money with advisor/broker/agent
Pay 1% (Government Levy) upfront on the way in (same as with shares)
Pay an annual management charge (typically 1.2%-2%)
Do not receive dividends (if apply will usually be absorbed by fund manager)
When you cash your policy in (sell) the growth is subject to a tax called 'Exit Tax' at 41% which is collected by the insurance company, you have no other returns to make
It's simple!

How about combining the very best of both of these investments; it might look a little like this:

Invest the money
Pay zero upfront Tax/Levy
Get paid Dividends and pay marginal rate of tax on them
Pay a one transparent & low annual management fee
When you sell your units you pay the lower tax rate of 33% Capital gains Tax

The great news is that this can sometimes be achieved with ETFs....check out full details on Blog 42

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When It Comes To Pension Planning We Will Get Our Just Deserts:

Deserts is apparently the plural of 'desert' which is 'that which one deserves'....honestly I always assumed it was to do with the jelly & ice-cream type of desserts.....but had never given it much thought in fairness! The same is most certainly true of Pensions. It would be hard to put it any more simply than I am about to now; You will only get a lot out if you put a lot in. If you are haphazard about your approach to funding for retirement then it is quite likely that the benefits you get from yours may be haphazard too.

Coming at you 'live' (and sideways) from Kenmare! Blame Your Advisor:

It may seem a bit pomp of us but your advisor (assuming you have one!) is absolutely at the coal-face of ensuring you know exactly where your level of income in retirement is headed. As we like to harp on about here 'begin with the end in mind' , otherwise what's the point in beginning!

If you find out upon retiring that your income is a million miles (or euros!) off what you were expecting, then much of that blame falls on your advisor. Now, if your advisor had been trying and trying to get through to you that you need to x,y & z in preparation for retirement yet you were only willing to do a,b & c then it's on you unfortunately!

So I Have A Pension, What Could Possibly Go Wrong!?

Imagine for a second that you are all of a sudden telegraphed onto a perfectly good aircraft. You are sitting beside an open door of the aircraft at 12,000 feet with a parachute strapped to your back. Yer man is shouting at you to jump out the door and to pull the parachute chord in 15 seconds. What is your first thought right now......................? While I have yet to test it in clinical studies I guess a lot of us think about that life-saving piece of equipment strapped to our back......will it open, will it work right, was it packed right, how fast will I descend......a whole host of concerns might enter our minds.....

Learn more about trivial pensions, and how to avoid some key mistakes when it comes to pension planning & financial planning in Ireland.

Thanks for checking it out.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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The noun Faff has been defined by the Oxford Dictionary as 'A great deal of ineffectual activity'.......most financial plans are absolute faff!

So there, I said it! I said it, and the fact of the matter is that it is pretty true. Any plan worth it's salt with regards to pretty much anything will be mostly faff, in hindsight. Bear with me and we'll explain!

(You can read the full blog here)

We really want to thank Carl Richards for writing the book 'Behavior Gap' which I have re-read (again!) recently. This book looks at how to help people stop doing silly things with their money. It also inspired my thinking for this episode, about Financial Plans, and how seldom they see the light of day!

in this episode you will get an insight into:

How Do I Create A Financial Plan?

What is A Financial Plan?

Why Do I Need A Financial Plan?

Why DO Financial Plans Go Off Course?

Among others!

Thanks for listening...

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Hey, and welcome to another episode of Informed Decisions Financial Planning podcast here in Ireland.

If you have ever asked yourself:

What are ETFs?......

How Do I invest in ETFs?.......

How Do ETFs actually work?.....

Are ETFs Risky?..................Then this episode will hopefully give you some useful information.

This time around we are taking a look under the bonnet of Exchange Traded Funds (ETFs) in Ireland and determining how they may or may not be something you want to get behind the wheel of as part of your portfolio.

ETFs are well documented at this stage, having grown in popularity for investors over recent years. They now estimate that ETFs account for 25% of all stock market transactions (in the US anyway - Ireland is a little behind those guys!). Whether you do or don't know about them there is no doubt they are popular and more and more of us regular folk are asking about them here in Ireland!

Thanks for listening. Full written version here.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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If you are a new visitor, welcome! Please do pop over here to find out why we exist, what our purpose is and why we are Ireland's first Financial Planning & Money Podcast. Also, if you have any questions or comments we'd love to hear from you, just drop a message to us here.

Apparently Noah's Ark was made of 'cypress wood' and was in the region of 500 feet long. It was said to have been quite a boat, large enough to hold 125,000 sheep if those were his orders! Anyone familiar with the story will know however that he was instructed to bring on only 1 mated pair of every animal that walked along the ground, and his own family. Poor Noah was given only 7 days in which to build this behemoth, and to ultimately save the animal kingdom, before the great flood arrived, no pressure!

If we were to relate this to our own financial lives it's fair to say that, unless you yourself are on the cusp of retiring, you have more than 7 days to build your own ark and save yourself from the flood when you stop working!! Let's discover a little more about Approved Retirement Funds (ARFs), and how they might be your ark when your own great retirement flood comes! There is no doubt it can be a really useful tool in your retirement and pension planning here in Ireland. Indeed anyone I have met with Pensions here in Meath has been a big fan of the ARF!

What is an ARF (Approved Retirement Fund)?

Other than sounding similar to an ARK, it too can be a real saviour when you do stop working and your income from employer/business stops! Ultimately an Approved Retirement Fund is a vehicle in which you can park some or all of your pension fund into when you decide to retire.

How Do I Get Into An ARF?

We outlined in blog 15 & blog 16 exactly how you can get access to an Approved Retirement Fund when you decide to retire. Broadly speaking if you are in a pension which you have set up and contribute to yourself (Personal Pension or PRSA) or are part of a pension through your employer (Occupational Pension Scheme) then you typically will have access to a glorious and lifesaving ARF. Check out blog 15 & 16 for the low-down!

How Much Do I Need To Get Into An ARF?

Providing you meet the basic income requirement as outlined in Blog 15&16 you can invest funds in an ARF. Imagine you are 35 years of age, with no pension put in place up to this point, you have always felt that pensions were for old people, they are a crock, the charges are outrageous or that you will never retire! Whatever the reason you haven't done one previously. Having listened to the Informed Decisions Financial Planning Podcast you decide that the time is nigh, you don't want to be left out in the flood!

For illustration if you were to manage to invest €400 per month into a pension plan for yourself. We will assume you increase this by 3% per year in line with headline inflation rate. So in year 1 you pay €400 per month, in year 2 you will pay €412 per month and so on and so forth!

If you were to achieve a net return of 7% per year average growth (you will need to find a pension with low charges and go heavy on equities- staying invested when things get rocky- which they will- see here!).

If you were to do that, and to achieve that long term plan, you would have €796,681.27 of a fund when you get to 68! The bones of €800k!

Under current rules you could take €200,000 of that tax free for yourself and go nuts! You would have an option to put essentially the remaining 600k into an ARF and access it as you need it. How bad!?

You could then take funds from this 600k as you wished! Imagine you took the minimum 4% of this per year, equating to €24,000 per year, which in addition to the State pension would bring your total income to the €36,000 territory. This would mean you pay essentially minuscule tax on your total income....all totally above board and legitimately done.....so if anyone is telling you that pensions are a crock just tell them this!

Please check out our full blog here if you would like the show notes!

Thanks for listening...You're a Legend!

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Needless to say it is a bit of a coup to have a Fintech Legend that has 9 million monthly listeners to his hit radio show 'Breaking Banks' in New York come on our show!

An Australian based in New York, he has taken a circuitous route to being a Global thought-leader in the FinTech World.

Paddy invited Brett to share his thoughts on the near future of how we will interact, invest and behave with our money. Ever thought about how our experiences will change when we venture even to our local shop?

Thanks for checking out Ireland's only dedicated Financial Planning & Money Podcast. Be delighted if you share and spread the word......be great if we could keep in touch with you directly here.

You're a Legend!

Paddy Delaney

QFA | RPA | Qualified Coach

Brett King Website

Brett King Radio Show

Informed Decisions Website

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PCP ('Phencyclidine' - not sure how that is pronounced!) was introduced in the 1950's as an anesthetic but was shelved in the 60's due to it's potentially lethal hallucinogenic effects. It was this hallucinogenic effect that made it so popular with recreational drug users and they have been producing it under the title of 'Angel Dust' since! It's chocka with Ketamine and apparently is the bees-knees if that is your idea of fun!

Another PCP, Personal Finance Plans, are on the scene now! This and other forms of consumer borrowing have rocketed in recent years, with experts saying the access to these loans is driving the new-car sales figures hugely, almost to hallucinogenic levels!

New Car Sales Figures for 2016:

Ireland 150,000

UK 2.7million

USA 17.5million

We love cars here at Informed Decisions, we don't necessarily spend lots of money on them however! We did a blog and podcast a while back to shed light on the true cost of cars, this proved really popular with many of you. We don't mean to suggest we have anything against cars, nor PCP Finance, but we do believe we should all understand the impact of what we are doing, so lets do the same with PCP Finance.

Before all that please do pop over here to find out why we exist, what our purpose is and why we are Ireland's first Financial Planning & Money Podcast. If you are looking for info on how to save or invest, protect your income, replace it when you retire or how you spend it in the meantime then this site is a useful resource here in Ireland! Also, if you have any questions or comments we'd love to hear from you, just drop a message to us here.

What is PCP Finance?

In Ireland, all we see to care about is mortgages, any time we have mortgages mentioned in our blogs/podcasts they are always the most listened to and most downloaded episodes, we just can't get enough of that wonderful stuff!

As always on this site we try to take a different view of things in order to help make it more practical and accessible to all, so we are going to 'mortgagise' PCP finance to try and make sense of it all!

To achieve this we will deep-dive PCP Finance, we will replace PCP Finance with 'mortgage' and 'car' with 'house'! See how you like that!

How Does PCP Work?

Most people have a good sense of it at this stage but let's have a brief over-view before we look at the figures. If you are thinking of buying a new house you can do so via PCP contract in your local dealer (pardon the pun!!). You select your house, pay a deposit in the form of cash or a trade-in house. You agree to a certain monthly payment for a certain period of time, typically between 3 and 5 years. At this stage you also agree the Guaranteed Minimum Future Value (GMFV), which is the final and largest payment you need to make in order to own the car at the end. This figure is based on the mileage, condition and estimate the dealer puts on the future value of the car after the 3-5 years.

What Happens At The End of The PCP Contract?

If you want to actually own the house at the end of the contract you must pay the GMFV as well as any 'completion' fees that may exist on the contract (you don't own it until you pay this by the way!).

Another option at the end is to hand back the house and walk away (where you would be walking to is another issue). Be aware that if the house isn't in agreed condition and wear & tear as set out at beginning of the contact then you may be subject to more fees.

The 3rd option is to roll into another PCP contract. The deposit you paid on the first house is not carried into the next contract, that's been and gone! If the actual market value of the house at the end is greater than the GMFV then you may have some equity to put to the new house you are looking at.

So that's a 'mortgagised' view of PCP contracts here in Ireland. Fairly straight-forward and sounds pretty simple. And we must try to remember that that is exactly how the dealer wants you to perceive it, the simper the better as more of us are likely to buy the produce!

How do the Financials of PCP Finance work in Ireland?

If you google 'PCP Quote' the first search is the Competition & Consumer Protection Commission This is a crackingly useful (not sure that's a word!) site with lots of information for us consumers to inform ourselves, worth checking out.

The next few are car manufacturers offering you the option to quote yourself for PCP. Having done this it still seems pretty easy and straight-forward, as they want it to be!

Let's take an example of a Hyundai i40 Tourer. A decent car by all accounts. There is an 'Executive' version of this 'house' for just over €29k, this is the base model of this house, so why it's called executive is a wonder. Seems a reasonable buy though, decent mileage and service etc.

Based on the illustrations on their site (and the rest are similar btw!), if you have cash deposit or a house to the trade-in value of €10k then you could be 'eligible' to 'qualify' for their PCP package! Yeah, congratulations! You could select the 2 to 4 year package, let's say you opt for the 3 year package to try get it paid off sooner rather than later. So you are in the house and all for €10k. Not so bad......

Your payments will be fixed at approximately €300 per month, based on a rate of 5.9%. You decide that this, along with the mortgage and the child-minding and whatever other expenses you have, is just about manageable to you.

The GMFV agreed (based on doing no more than 15,000kms per year) is just over €11,000 in 3 years time. That is what the dealer is telling you it will be worth in 3 years time provided the wear & tear is average and that the mileage is as predicted.

If this really were a house you are agreeing to pay a deposit of 30%, then agree to pay 6% interest on the repayments, which are over 3 years, and that the value of the house is going to fall from €29,000 to €11,000 in that 3 years, at which point you will then exercise one of the three options outlined above......really!!!??

You can the pay the €11,000 to own the house You can hand back the keys and walk away (provided it is in good nick). Or, you can trade it in against another house and pop some more PCP into you!

And therein lies the nugget here. PCP really is a bit like the drug in that once we get on it we may find it hard to get off it! What it does do is help us to really easily hallucinate and forget about the depreciation we are paying over the term. That amounts to €20,000 in this example, over 3 years.

If it was a house we just wouldn't buy it, PCP or no PCP! Who buys a large asset which will cost you €20,000 over a 3 years period, in depreciation alone!? It seems that lots of us do, that lots of us see the simplicity, see the easily manageable monthly payments, see the easily achievable max mileage and forget about the largest yet least obvious cost. Stop hallucinating!

Is PCP an illegal or unethical product? We don't think so, but we do think you need to know what they hell you are doing!

But hey, that is what makes the area of our behaviours, biases and what some would call our predictable irrationality around money so interesting!! You have the information now, what will you do with it?

Please share this article and check out the podcast while you're at it!

Thanks so much for listening. You're a legend.

Paddy Delaney

QFA | RPA | APA

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Welcome to Episode #41 of the Informed Decisions Financial Planning Podcast, still the only dedicated resource here in Ireland.

In this episode Paddy speaks with Stephen Browne, who is owner and distributor of Voyant here in Ireland. There are several providers of this type of software for Financial Advisors and Planners, such as Truth, however Voyant is a leading player in the Financial Planning/ Financial Forecasting Software industry.

Stephen shares insights with listeners on what is it, what it does and importantly how financial panning software might benefit you in the long run.

While the software is generally only used by Planners, for their clients, here is a link to Voyant Ireland's website if you want to check it out.

Thanks for sharing...

Paddy Delaney

QFA | RPA | Qualified Coach

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Last week we explored what will happen when the next crash comes......and importantly how we will react. It is the volatility of things which causes us to react, not the risk!

Volatility is not risk, risk is not volatility. I'm not trying to be profound (it's not one of my strengths!). In today's world the two are thrown together, interchanged in conversations, media and advertising, yet they are 2 completely different things. It's sort of like interchanging chalk and cheese in conversation:

Hey, did any of you students take the cheese I was using to write on this black-board? (showing my age there!)
Hey, would you like chalk on your ham & turkey sandwich?

Makes no sense, just as it doesn't to mix risk and volatility, yet we all do it, and I am as guilty as the next fella/gal!

Now this may help some of you, and it may not help, yet it is a critical aspect of retirement planning, pensions, investing and savings of any sort here in Ireland, it is vital to understand the difference between the 2, particularly if you want to make informed money decisions...speaking of which please do pop over here to find out why we exist, what our purpose is and why we are Ireland's first Financial Planning & Money Podcast. Also, if you have any questions or comments we'd love to hear from you, just drop a message to us here.

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Regular readers & listeners will by now know that Informed Decisions isn't in the space of trying to predict the markets, we leave that to the fortune-tellers of this world!

We don't see any benefit in dissecting the daily news-feed and trying to interpret what that means for our investments, pensions, property prices etc. Nobody can do that with any degree of accuracy. Also, what difference does it make if the price of something which you intend holding for 10, 20, 30 or 40 years fluctuates by 0.1 or 1% this week??

And that is what this week's shortish blog is out to address, our human inclination to do something stupid at the absolute wrong time! It will be a real test of our Financial Planning here in Ireland, so listen to this podcast episode to be as well prepared as possible not to do the wrong thing when that time comes!!

Thanks for listening and sharing.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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We were humbled to have been contacted by the Irish Times a few weeks ago and asked for our opinion on life cover for an article by journalist Eithne Dunne, published in the Sunday Times on 21st May.

We wholeheartedly gave our 'tuppence-worth' on some of the things we believe are important to consider when selecting Life Cover for yourself. However it also dawned on me how big a problem exists with regards Life Cover, so we are out to quash that problem right here and right now.........in a second!

Firstly, if you are a new visitor to Informed Decisions, welcome, and have a quick look over here to find out what we are all about & why we exist! We are on a mission to bring practical financial planning & personal finance to Ireland's millennials. If not, welcome back to Ireland's only dedicated Money & Financial Planning Podcast!

What's The Big Problem!?

Life Cover, it's a product (of many sorts!) and as someone recently said to me 'everyone and their Granny sells it'. The commissions paid to the intermediaries and agents who sell it can be pretty rewarding for them. So, do intermediaries and agents be they online or face-to-face make money if you buy Life Cover from them? Of course they do! As do people from whom you buy tanning lotion, cars, carpets, jewellery, cat milk, holidays, lawnmowers, home insurance, windows, taxis, shoes and every other consumable item or service on this planet!

However it is the fact that people make money from selling it that we believe leads to a wholesale dislike and general apathy to this form of 'insurance'! And this is a problem ( oh by the way I was recently told by a reputable source that it is actually OK to start a sentence with the word 'and'!). Consumers are often therefore also sceptical of the benefits and their potential need for Life Cover, and not knowing who to trust! We may all have heard someone (or ourselves) say 'sure yer man/ yer wan was trying to sell me bloody life cover, sure I don't need that stuff, a racket!'.

Maybe you do, maybe you don't but please don't let a sceptical view be a barrier to a potentially life-changing product for your heirs! In this episode we are going to address this problem, we are going to outline how to figure out for yourself if you actually need any Life Cover, presenting purely facts, and you decide for yourself if you need to buy some or not, and also how much Life Cover to buy if you do decide you need some!

I remember almost 10 years ago when meeting a client who insisted that he did not need Life Cover (despite having 5 kids and a wife whom were all relying on his salary!), when I probed he advised it was because "he was not going to die, ever", and he wasn't joking. That's a separate issue and not sure it's one I can address in this blog!!!

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Many of us have heard of psychology, many of us have heard of positivity, yet not many of us have heard of Positive Psychology, which is an emerging science in and of itself. That's why we are bringing it to you, and looking at how we can utilise it in managing our finances.

In this episode we are delighted to host Dr. Jolanta Burke, a Doctor of Positive Psychology, a visiting Professor in Trinity College's School of Psychology, and a Senior Lecturer in School of Psychology, University of East London. Whether you are considering your budgets, planning for retirement, planning on buying life cover, or indeed nurturing your kids there is something of note in this episode!

If you are a new visitor to Informed Decisions, please have a quick look over here to find out what we are all about & why we exist! We are on a mission to help normal Irish people with practical financial planning & personal finance info. If not, welcome back to Ireland's only dedicated Money & Financial Planning Podcast!

Thanks for checking it out, if you find it any way useful please share it or review it!

Thanks,

Paddy Delaney

RPA | QFA | APA | Qualified Coach

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Apparently 66% of the 70,000 'landlords' in Ireland own 1 investment property. Surely you don't want to look a gift horse in the mouth, you want to be one of these?

"Sure property prices are climbing, you'd be mad not to own at least one investment property". You buy the place and rent it out so that someone else can pay the mortgage for you, job done! Right?! Seems not long ago when this was the regular 'pub talk', however it is over 10 years ago now, and that talk is coming back (to a degree!). For a long time a bank would ring the Gardai if you went in and asked for a 'buy to let' mortgage (a loan to buy an investment property which you would rent out). They have softened, and are actually advertising these again, just google it!

Now before we jump in it's worth noting that there is a large % of our generation who are making ends meet, putting kids into creches, working hard, and paying the bills, maybe stashing a few quid each month for future and for rainy days. For this % of us a buy to let is not on the radar at all.

Having said that there are also a fair % of our generation who have quite a bit of disposable (spare) income each month, their income may be comparatively high or their outgoings comparatively low, or indeed a mixture of both (if you are really fortunate!). It is this % that may be sniffing at the idea of buying another property or moving out of their home, renting it out and buying another.

Considering a mortgage for an investment property in Ireland? In this episode we will share with you the maths behind mortgaged investment property ownership, so you can make your own mind up on whether it is for you or not! And that is the point isn't it, in owning investment property, it must be in order to try achieve some form of financial gain, otherwise why would you even consider such an investment (unless you fell into it by accident of course!).

If you are a new visitor to Informed Decisions, have a quick look over here to find out what we are all about & why we exist! We are on a mission to bring practical financial planning & personal finance to Ireland's millennials. If not, welcome back to Ireland's only dedicated Money & Financial Planning Podcast!

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We all know that money is not the be all and end all.....most of us appreciate that there is more to life and more to being a decent human. We might also recognise that living a fulfilled life is not about having full bank accounts, but it sure does help to have sufficient money to make your own decisions and live the life you want!

As parents we are naturally wired to try and create positive futures for our children, that probably why we care so much, right!? As part of that for some parents it will come naturally to instill an element of financial awareness and sense into our kids, and to maybe ensure they are a bit better able to manage money than we are! This episode is going to explore just a few ways of doing that, some you may have considered and some not......including a little bit about Andy Dufresne!

Thanks for reading, don't forget to drop me a mail at if you fancy a copy of that Excel sheet mentioned in this episode.

Thanks for tuning in.

Paddy Delaney

QFA | RPA | APA | Qualified Coach

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Hi All,

Why Is My Defined Benefit Scheme Closing?

What Should I Do About My Defined Benefit Scheme Closing?

What Income Will I Now Have in Retirement?

In this episode we empathise whole-heartedly, then delve and explore the options available to the many many thousands of employees who have 'lost' their Defined Benefit Pension Schemes in recent times. We go about answering the above questions. All is not lost!

Most 'normal people' out there (with the exception of financial nerds & indeed yours truly until I started working in this area 12 years ago!) have no more interest in Defined Benefit and Defined Contribution schemes than the man on the moon! It's sort of like saying to your mate, 'you know, the price of beef in Kilkenny Mart today jumped from €3.60 per kilo to €4.05 per kilo in the space of an hour!!', not really that interesting or relevant to most of us, unless of course your mate is a beef farmer! If you know of anyone who is losing or has lost their DB scheme please do them a favour and pass this on.

Thanks,

Paddy Delaney

QFA | RPA | Coach

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Risk. The Oxford Dictionary defines risk as 'the possibility of something unpleasant or unwelcoming happening'! It is therefore not a word which most of us are that much inclined towards.

There are many forms of risk which many of us don't really think of until it happens! In this episode we will unearth these risks, and indeed share ideas on what one can do to manage them (if possible!).

On a related but separate note we are delighted to tell you that we have written & launched our first ever quick-guide resource for you guys!

This was based on your feedback to our Financial Planning in Ireland Survey a few short months ago. We want you to download your own complimentary copy of the '4 Principles Guide' to Investment Success; simply click the pop-up or head over here and add your email, we'll mail it directly to you, for keeps, at no charge at all........limited time offer!

Flick over to the written version if you prefer to read this episode!

Thanks,

Paddy.

QFA | RPA | Qualified Coach

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Welcome to Episode 31 of The Informed Decisions Financial Planning Podcast.

This Podcast Episode took all of my efforts, Tax is not a subject I especially enjoy but you are worth it!

In this episode we explore how Income Tax works, what other tax is generally taken at source, and how to manage the levels of tax we pay. when we approach out Financial Planning in Ireland it can be so important to ensure we are paying the right amounts, and no more!

You can check out the full written version of this show here.

We are aiming to have all regular visitors to join our mailing list. If you are not on it please do so here. Email & first name is all we ask and we will send you a weekly exclusive update on what's happening at Informed Decisions.

You're a legend!

Paddy Delaney

QFA, RPA, APA, Qualified Coach.

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Welcome to Episode 30 of The Informed Decisions Financial Planning Podcast.

In this episode I am going to open the can on Financial Advice full stop! I am going to outline why you don't need any initially, and how you can help yourself.

For the past 2 weeks our Podcast featured Dr. Daniel Crosby and discussed how we can enable ourselves to make more informed money decisions. One of his key principles was that 'we cant do this alone'. In this he outlined that all the research goes to support the idea that as investors we will do a lot better if we have the guidance of a competent financial advisor/coach. This point also related to the management of ones funds.

However on this show we are also conscious that a lot of us won't yet have accumulated large assets/investments, and that is who we are supporting in this weeks' episode.

You can check out the full written version of this show here.

You're a legend!

Paddy Delaney

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Welcome to the latest Podcast in Ireland's only dedicated resource on Financial Planning for millennials. In this episode we bring you Part 2 of the Dr. Daniel Crosby Interview (New York Times Best-Seller might I add!) as well as the results of our Annual Listener Survey. I promise to be as concise as is feasible!

If you are a new visitor to Informed Decisions, have a quick look over here to find out what we are all about and why this blog & podcast exists in Ireland. If not, welcome back! As always, you can check out our Podcast, Ireland's only dedicated Personal Finance & Financial Planning Podcast for millennials.

Thanks for checking us out!

Paddy Delaney

QFA, RPA, APA, BBS, Qualified Coach

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It is not too often that we get to speak to a New Your Times Best Seller, so we are so chuffed to speak to Dr. Daniel Crosby, a specialist in Behavioural Finance. If this term is new to you then you are in for a treat. If you are familiar with it you are also in for a treat!

Join Paddy on Part 1 of this special interview to learn his fully researched strategies for managing your financial decisions for maximum results.

If you have not then you really need to join our exclusive mailing list here!

You can find Daniel's book here.

Thanks so much for tuning in and sharing what is Ireland's only dedicated personal finance and financial planning podcast.

Paddy Delaney

(QFA, RPA, BBS, APA & Qualified Coach!)

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In this episode Paddy follows up on last week's show and shares the main ways of saving for education. Importantly it will highlight the main pros and cons of each and give you a sense of realistic growth expectations from each. If you would like to see the blog version of this episode you can get it here.

If you are a new visitor to Informed Decisions, have a quick look over here to find out what we are all about. As always, you can check out our other episodes in Ireland's only dedicated Personal Finance & Financial Planning Podcast.

If you have found this piece of any benefit whatsoever we would be super chuffed if you would share it with someone you know who might be in the same boat as you.......and of course make sure you join our exclusive weekly mailing list here. Ah Go On, do it here....

You're a Legend!

Paddy Delaney

Informed Decisions Financial Planning

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In this episode Paddy shares the main costs of education so you can begin planning, but importantly will open your eyes as to 'how' to achieve the fund necessary to cover such costs! In Part 1 we share illustrations to show you what is involved in getting to your goal. Part 2 (next week) will delve into the pro's and con's of the different products and avenues available. If you would like to see the blog version of this episode you can get it here.

You're a Legend!

Paddy Delaney

Informed Decisions Financial Planning

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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 & 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 (& 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 & Said Company Make Lots of Profit From You

If you were to follow steps 1, 2 & 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.

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Hi All,

This week we are sharing something a little 'off topic'!

I have been looking for an opportunity to donate this year, so for every completed Informed Decisions Survey in the next 6 days I will donate €1 to Irish Cancer Society. Given that I am doing all 'this' at no monetary gain I need to cap this at €200, so please help me get to that mark.....share it like there's no tomorrow!

Six months after the very first Informed Decisions Podcast it probably is a good idea to check-in with you 'regulars' and provide a bit of an update on how this little website is progressing! I am also reaching out to you and seeking your help; with an important invitation for you to have your say on the shape and format of Informed Decisions via a short but important anonymous Survey/Questionnaire!

If you have got any value from us in the past 6 months we would really appreciate your time (4 minutes!) in completing this and having your say. It will allow us to identify a broad profile of who is listening & reading, and importantly your preferences. Ultimately it will ensure we provide information and tips which you want! How novel an idea is that!?!

If you would prefer to jump straight to the Questionnaire you can please do so on this page here. If you would like to know a bit more about the website, how it started & how it is getting on then keep reading...............

How Did It Begin?

December 2015 during the Christmas Break I took it upon myself to start writing on the LinkedIn blog platform 'Pulse', just as a little exercise in creativity. I have a deep interest in all aspects of money management and Financial Planning and was quite fond of writing, so it was a natural thing to do! Another catalyst was that so many of my own circle of friends have a self-declared lack of interest or knowledge in this space, so I knew it would be a help to my own generation (millennials!). The feedback from these initial articles were positive, and I really enjoyed the process of creating the pieces. I was hooked!

After a bit of consideration I decided then to go about starting my own blog, one which I could manage myself instead of it being owned by LinkedIn. As you know I work full-time as a Financial Service Trainer so I approached my employer to confirm there would be no conflict of interest in me doing so. They were most generous in giving it their thumbs-up and wishing me every success, provided I clearly expressed that my views were my own, naturally enough. The scene was set! After much research and procrastination the website www.informeddecisions.ie went live in April 2016.

"What keeps me going are my original motivations; to support my fellow millennials with making informed money decisions, to exercise a creative muscle and to ultimately to make a positive difference."

Where Did The Podcast Come From?

Podcasts in the Financial Planning & Personal Finance space are rare, even in much larger countries like UK, almost like hen's teeth! They require a lot of unseen preparation and are notoriously difficult to get audiences so that probably explains why there was none in Ireland until Informed Decisions Personal Finance Podcast. Producing a Podcast seemed like a major stretch of my imagination in April 2016 but I researched the idea over the following months, and with the support of some great folks in the UK and here in Ireland it started to come to fruition. In early August we launched our first podcast, which was an exciting time for Informed Decisions, an achievement of a once galactic goal! What I have found is that I have learned so so much about an awful lot in the process, so it has been win win really.

Where Are We At Now?

Well the iTunes reviews have started coming in and the feedback has been really positive. Please do check it out here and feel free to add your own iTunes review if you are using it and feel this site has been of benefit to you here.

Writing a Blog & Podcast each week takes consistent effort which was not always my most obvious strength! Both from a research, planning and indeed writing & recording perspective there is lots to consider, not to mention the computer side of things! What keeps me going are my original motivations; to support fellow millennials with making informed money decisions, to exercise a creative muscle and to ultimately to make a positive difference.

I heard a quote recently from Shane Mulhall (RIP) of The School of Philosophy which really resonates with me "Do for the joy of doing, not for the purpose of advancement". I hope that doesn't sound too waffly but that sums up Informed Decisions pretty nicely. I am enjoying it and the feedback and value others are getting from it is real, so again it's a win-win!

Speaking of feedback, we have received lots or really positive comments from readers of the Blog and Podcast listeners. People have got in touch to say that as a result of it they have been able to take proactive action with regards to their budgeting, retirement planning, protection, goal setting etc. This makes it worthwhile for me personally.

It was not something that I had kept an eye on at all but I was recently told that the Podcast was in the Top 20 in iTunes Chart in it's category! Top 20!! I was dumb-founded and obviously thrilled to see that the word was spreading and more and more people all over the country are benefiting from it.

What Does The Future Hold?

Who knows! Many folks have asked me am I going to turn it into a business and will I do x,y or z. To be completely frank I really enjoy my role as a Trainer, and I really enjoy Informed Decisions, so for as long as both sensibly co-exist I am delighted to do both! As long as you continue to get benefit from the site, blog and podcast I will keep producing it.

My Ask Of You?

We have no way of identifying the broad profile of you, those who are actually listening or reading, nor have we any sense as to what you guys actually want from us. Therefore I have created what I hope is an attractive and quick questionnaire which gives you the opportunity to input into what we are doing and how we do it. We will compile & share the findings (anonymously obviously!) once we have sufficient responses to it. So do it now (please)!!

If you have got any value from this website then we would be so appreciative of your participation. Click here or click the image below to get stuck in.

Thanks so Much.

Paddy

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Hi,

Firstly, thanks for joining us! If you are a new visitor to Informed Decisions, have a quick look over here to find out what we are all about. If not, welcome back to Ireland's only dedicated Personal Finance & Financial Planning Podcast!

Everyone has been told to do one, but 'why & how' needs to be answered first! Join Paddy as he demystifies the topic in this 16 minute audio show....

Thanks for sharing and spreading the love, the message is getting out there. Thank You.

If you prefer to read this episode then please do check out Blog #21.

Cheers,

Paddy Delaney

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Hi,

A pretty influential insurance 'evangelist', Hesus Inoma is founder & CEO of WeSavvy, a Dublin-based start-up in the process of reshaping how we engage and manage our insurances.

If you have ever gotten a Health, Home or Motor Insurance renewal letter in the post or via email you will know it is not always the most rewarding experience!

WeSavvy is working to forge the future of how consumers interact with their Insurances, get rewarded and essentially earn cash-back by living healthy life-styles.

Thanks to Hesus for his time and sharing what he sees as the future of Insurance across the globe.

Thanks to you too for tuning-in!

Paddy Delaney.

You can join the WeSavvy movement at www.wesavvy.com

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Hi, and thanks for popping in to listen to this weeks' Episode, which promises to be an interesting one for anyone who owns a car (so that represents the vast majority of us!). If you are new here please do check out this page, which will tell you a little about why this project exists and what it's aiming to do for you. Episode 21 is here:

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While some would argue that the cost of running a car hardly qualifies as a Financial Planning topic, I would beg to differ. Seeing as many of us possess one for the duration of our adult lives our choice of car represents a significant life long investment. What I am hoping to uncover is exactly how much they cost and what if any differences there are in buying a 'newish' car versus an older car!

Some of you at this point will hit the red 'x' in the top right hand corner, you like your cars, you don't care what they cost you, provided you can afford to have a 'nice' car you will continue to do so irrespective of the financial costs. I respect that, hit the red 'x', but might do you no harm to see what it is actually costing!

In the interest of being up front I will state that even before we look at the figures I have always had a strong bias towards owning older cars (6-10 years old) where the largest depreciation costs have been absorbed by a previous owner, however I am always open to correction, so lets see which option is the more informed from a financial perspective!

Assumptions:

For the purpose of this exercise I based my findings on 2 family sized cars. The 'newish' car is a 2013 Volkswagen Passat 1.6 Diesel from a dealer, with 62k miles on the clock costing €20,450- listed on Carzone.ie at time of the research.

The 'old' car for the purposes of this exercise is a 2007 Ford Mondeo, 1.8 Diesel, 90k miles on the clock costing €4,700 from a dealer, again it's listed on Carzone.ie at time of research.

Our exercise will assume we hold the car for 3 years, before changing it again for another car. Mileage assumed at 13,000 miles per annum.

The Cost of Owning a 'Newish' Car for 3 years:

Depreciation: €12,450 - Buy it for €20,450. Based on the research when you go to sell a car of this type in 3 years, assuming average mileage and it being well maintained, you will get approximately €8,000. Irrespective of selling it privately or trading it in this is the approximate value achieved (even VW which historically hold value reasonably well).
Fuel Cost: €4,029 - This modern car will give approximately 55 miles per gallon on average. www.honestjohn.co.uk is a great website for honest mileage numbers. Using a diesel price of €1.25 per litre, and traveling 13,000 miles per annum, that's the cost over the 3 years!
Motor Tax: €570 - As a post-2008 car, with relatively low emissions of 109g/km motor tax will set ou back €190 per annum
Maintenance: €1,200 - This assumes carrying out 1 annual service and changing 2 tyres per annum, with no other major outlay on this relatively young car
Insurance: €1,800 - This one is a big variable dependent on the driver and his/her status and years of no claims bonus etc, however the same figure will be used on both examples
Total Cost = €20,049

The cost of having this car for the 3 years is over €20,000. With good fuel economy and low tax it still amounts to a fairly sizeable amount of cash! If we break that down annually it is €6,683. Per month that is €557. If you are on the higher tax bracket you need to earn €1,100 Gross Salary in order to pay for your car..........................If you earn €50,000 Gross, that is 1 week's work per month to pay for your car! Seems hefty, but lets now compare it to the alternative, a cheaper, less flashy, less efficient and perhaps less reliable motor!

Cost of owning an 'old' car:

Depreciation: €2,220 - Buy it for €4,700. Based on the research when you go to sell a car of this type in 3 years, assuming average mileage and it being well maintained, you will get approximately €2,500. Irrespective of selling it privately or trading it in this is the approximate value achieved.
Fuel Cost: €5,039 - This less modern car will give approximately 44 miles per gallon on average. Using the same diesel price of €1.25 per litre, and travelling 13,000 miles per annum, thats the cost over the 3 years for this car.
Motor Tax: €2019 - As a pre-2008 car, with a 1.8 litre engine you are in for a juicy €673 per year road tax, no avoiding it!
Maintenance: €2,400 - This assumes carrying out 1 annual service and changing 2 tyres per annum. In this instance we have included €300 per annum for ad-hoc repairs. While this could be quick a lot more or less on a car of this age and mileage this average is an industry accepted figure.
Insurance: €1,800 - This one is a big variable dependent on the driver and his/her status and years of no claims bonus etc, however the same figure will be used on both examples
Total Cost = €13,478

So there you go, the estimated cost of 3 years of motoring in such a car will cost you just south of €13,500, which works out at €4,492 per year and therefore €375 per month. Before tax you are looking at earning €750 Gross Salary to put this car under your back-side.

The single biggest cost differentiation between the two options is depreciation, yet this is the one factor which many many of us do not give due consideration to. We fail to include that in the cost of ownership, however it is a very real part of the cost, and in some circumstances is the single biggest aspect to the overall cost. Fact.

Many of us millennials see the shiny new shapes, we see what our peers are driving, we see the latest adverts, we see the 171's on the road and we start to feel that our 'old' car is giving a poor representation of ourselves and portrays a lack of success. I'm being somewhat melodramatic here obvously but there are elements of these emotions behind our decisions in buying 'newish' cars. I often look to the example set by Mr. Warren Buffet (3rd wealthiest man on the planet). He drives a regular joe-soap car, and seems pretty happy with it!!

Conclusion:

As always I believe you are more than capable of drawing your own conclusions from the above. As with many of our financial decisions there is more often than not an emotive drive determining the outcome. One could choose to drive an older car, and to use the 'savings' to save for the future, enjoy an extra holiday or some other experience. Likewise one may prefer to be seen driving a 'newish' car, they may like the reliability and feeling they get from a more modern car, and are happy to sacrifice the 'savings' in favour of these aspects. Likewise they may not realise the costs of owning a car, until now!

Ultimately the choice is yours of course, but at least now you have a greater sense as to what your car is costing you, and indeed if you have 2 cars in your household what they are costing you.

If you are trying to budget and manage or indeed reduce your cash outflows the ownership of cars can be one of the single biggest factors in doing so.

I have included a sample calculator which I created for you to run your own numbers here, have fun!

Thanks for reading, sharing and spreading the love!

Paddy Delaney (QFA, RPA, Coach)

Links:

MPG Information for use in above calculator:

http://www.honestjohn.co.uk/realmpg/

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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 & 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 & Now Qualified Coach too- yay!!)

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Hi,

Welcome to Informed Decisions Podcast #19! Thanks for continuing to listen and learn about critical aspect of Personal Finance & Financial Planning.

Specified Illness has been getting the 'Joe Duffy Treatment' for years, lets see if it is deserves it!

PODCAST HERE:

If you are new here, welcome! This is a great place to begin the journey if you are a new visitor.

Any (decent) builder would tell you that in order to build the house of your dreams, you need to put in place solid and durable foundations. While these foundations can be expensive, are no addition to the overall look of the house, and often more expensive than initially envisaged, I'm sure we all agree that they are a must have.

The same can be said of our financial lives; solid foundations will help support you if there is an earthquake, landslide, or even some mild tectonic shift! We addressed the basics back in earlier blogs and podcasts, but lets dig deeper on one of the core aspects of financial foundations, protection. Many of us in our 30's have some sort of cover in place, have been offered it or seen adverts online. What to do!? Over the next few weeks we will explore of each of the main types of protection on offer to us today, and whether they are something to consider or not!

Specified Illness Cover, Serious Illness Cover, Critical Illness Cover, Disability Cover, Income Cover, Permanent Health Insurance, Income Cover, Income Protection, Bill Cover, Inability to Work Cover......these are just a few of the names thrown around for various types of 'living benefits' (you don't have to die to claim them!) which may or may not help you financially if you are unable to work due to accident, ill-health, injury, mental or physical illness. In this blog we will dig deeper on Specified Illness Cover, aka Critical Illness Cover as it stands in Ireland today.

What is Specified Illness Cover?

As it's name suggests when you are medically diagnosed with a specific illness, injury, ailment or condition you would receive a tax free lump sum payment. It is for that reason that i always refer to this as Specified Illness Cover, because it's claim is dependent on whether is was one of the specified illnesses.

When you apply for this cover you will/should be given a clear list of the illnesses, the definitions of each, and the severity of which you must be diagnosed in order to be considered valid for a claim under any particular illness. If you suffer from something which is not on this list, or is not of 'sufficient severity', or does not meet the 'definition' you do not get your claim. If it does you do.

What sort of illnesses are covered by Specified Illness Cover?

Every serious life company in Ireland offers Specified Illness Cover under one title or another, each one will largely cover the same illnesses, however some have different definitions and severities under different illnesses. This is where it can get a bit murky and subjective in terms of which route is best. It's important to research this yourself, as well as taking the input from the providers, in order to make an informed decision on which is most appealing to you.

Irrespective of that, all providers will cover the 'Big 2'; so if you are diagnosed with having had a Heart Attack (of specific severity!) or Cancer (of specific severity!) you will be covered.

There are also another approx 50 less common, more bizarre illnesses covered by the various providers. For example surgical removal of an eye is a regular on the list, indeed diagnosis of flesh-eating bugs is another more recent addition by one provider! Hmmmm.

What definition must be met to claim my Specified Illness Cover?

Here's an example of the definition involved for claiming on a cancer diagnosis under specified illness by one provider, as of Jan 16. Worth noting that not many of the providers make the definitions available online. Doesn't inspire trust does it! Here's the high-level definition for Cancer:

Any malignant tumour positively diagnosed with histological confirmation and characterised by the uncontrolled growth and spread of malignant cells and invasion of tissue. The term malignant tumour includes leukaemia, sarcoma and lymphoma except cutaneous lymphoma (lymphoma confined to the skin).

So there you have it, if you had Specified Illness Cover and were diagnosed with a form of cancer, that is the definition your condition needs to meet in order for you to have a valid claim. If it doesn't currently meet that definition then you don't get your cash. If it does then you submit your claim, backed up by medical evidence from a medical professional and you can await your cash payment.

While no official figures can be found to show how many Specified Illness Claims there are every year from all the insurers I gather there are in the region of 2,000 claims each year in Ireland. That is just under 8 individuals in Ireland each and every working day either being diagnosed with a specified illness, sending in their claim, or receiving their claim cheques. That again is scary. The average amount each individual claims is estimated at €60,000.

What would you do with the money? What's the point in laying this foundation?

As a result of us being 5 to 6 times more likely to suffer from one of these illnesses than we are to die before 60, it is therefore in the region of 5 times more expensive than life cover. As a key element of our financial foundation it ain't cheap, and it is because it is statistically so likely to happen, unfortunately.

Consider if you were in the situation of being diagnosed with a cancer which displays levels of 'uncontrolled growth and spread'. It's scary, it's hard to picture, however many of us will have had first or second-hand experience of this.

What sort of an impact will it have on you and your circumstances? Will it impact on your ability to work, to earn your current income? Will your partner need to take time out of work to support you or replace you in some way? How will you pay for medical treatments? Will you be under financial pressure to return to work as soon as possible as opposed to taking time out? What impact will it have on your financial goals? Will you have to rely on loved one's to support you? Will you have financial concerns?

If you answer 'yes' to any of these then having some level of Specified Illness Cover may be appropriate to you. The level of cover you should have will depend on many factors, among them; what emergency fund you have in place, what impact a diagnosis will potentially have on you, what your income is, what your affordability allows and ultimately it will boil down to how big a problem you feel it would be if it did happen.

Irrespective of how much there is no doubting that for many of us it is prudent to have an element of it in our financial foundations, no question. In conjunction with some of the other foundation protection types we will discuss over the coming weeks it can help keep your house intact while you overcome the earthquake.

Whatever you do or do not do with this information at least make sure that you make an informed decision with regards your financial foundations.

Thanks for reading, liking, commenting and sharing the love!

If you prefer you can follow the link below to listen to the podcast, or subscribe to the podcast via iTunes.

Thanks,

Paddy.

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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

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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 & 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 & 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

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Paddy Delaney (Parent, Educator, Qualified Planner & Executive Coach)