Feb 2018 Update: Our more recent post highlights the best investment opportunities for your money in 2018

 

Question: Where’s the best place to invest your money in 2017?

Answer: it depends.  And if anyone offers you ‘the’ answer to this question, it is almost certainly too good to be true.  There is no single best place to invest money in Ireland.

So if you’re serious about investing your money well, ask these five questions first.

Will it perform?

Everyone knows the warning that ‘past performance is not a reliable guide to future performance’.

But past decisions are.

So for any investment you’ll want to know what you are really buying.  Maybe you’re backing an outstanding management team, by purchasing shares in their company.  Or getting a piece of a fund which has decided to major on technology investments.  Or you’ve identified a great angle on forestry.

The question is the same in every case.

Whatever opportunity you consider, you’ll want to satisfy yourself it is well managed, and present in industries and locations that have a reasonable prospect of growing.

Can I access it when I need it?

This one depends on your circumstances.  Some people are happy to lock up their money for years at a time.  At Moneycube, we don’t really see the benefit to most investors.

The main reason to accept restricted access is for tax purposes, such as a company share scheme, or a pension.  Beyond that, we believe it’s in most people’s best interest to choose liquid investments such as cash, shares and investment funds.

Is the risk level right for me?

You probably already realise the need to take some risk with your money to give it the best chance of medium term growth.  How much risk, and what kind of risk, is right for you?  There are lots of online tools to help you figure that out – including one as part of Moneycube’s investment process.

Are the costs sensible?

Costs are a vital consideration when you evaluate the best place to invest money.  There are two main kinds.

Obviously, there’s the cost of the investment itself.  A great investment is not a great investment at any price.  You’ll want to form a view on value.

Then there’s transaction costs like transaction fees, government levies, and advisor and manager fees.  Again, this is a question of getting good value by not paying unnecessarily, and getting a high-quality service when you do pay.

What are the tax implications?

Yes – you can cut your tax costs.  But it usually comes at a price.  In short, it makes things complicated.  And that holds many people back from getting on with building their wealth right now – which is Moneycube’s main aim.

Maybe you’ll have to manage it closely yourself (like a share portfolio), or plan for lack of liquidity and diversity (like an Employment and Investment Incentive Scheme).  That could be a price worth paying.  Just make sure the tax tail isn’t wagging the canny investor dog.

The best place to invest money depends on your circumstances.  If you’re looking for professionally managed investment funds which satisfy the questions above, Moneycube can help find the right answer for you.

 

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