Sav­ing com­mu­nion cash good way to learn

Sunday Independent (Ireland) - Business & Appointments - - FRONT PAGE -

Direc­tor of Com­mu­ni­ca­tions and Mar­ket In­sights with the CCPC (www.ccpc.ie) to help max­imise the ben­e­fit of your nest egg. If you have any debts out­stand­ing (such as credit card debt, an over­draft or a per­sonal loan), you should con­sider pay­ing th­ese off.

In­ter­est rates on th­ese prod­ucts are gen­er­ally high — in par­tic­u­lar if you have an out­stand­ing bal­ance on your credit card. If you have a mort­gage, you could also con­sider pay­ing off a lump sum which would mean you would pay it off quicker and there­fore save money on in­ter­est. How­ever, if you have a fixed rate mort­gage, you could be charged a penalty to pay off a lump sum — so talk to your lender about your op­tions first.

Re­turn on sav­ings may be low but if you are look­ing for a risk-free op­tion, this is gen­er­ally the most straight­for­ward op­tion. Do bear in mind that any in­fla­tion will mean that your money loses value over time.

A good place to start if you want a de­posit ac­count is to com­pare the var­i­ous prod­ucts avail­able. There is a handy lump sum sav­ings com­par­i­son tool on the CCPC’S web­site which you can use.

This tool shows the cur­rent rates and fea­tures of all sav­ings ac­counts on the mar­ket for fixed-term de­posits (where you lock your money away for a cer­tain time), no­tice ac­counts (where you must give a cer­tain amount of no­tice for with­drawals) and in­stant ac­cess (where you can with­draw money at any time) ac­counts.

If you can af­ford to lock your money away for a set pe­riod, a term de­posit ac­count will gen­er­ally of­fer a higher re­turn. How­ever if you need im­me­di­ate ac­cess to your funds, you can choose an in­stant ac­cess ac­count. You could also split your money into a term de­posit and an in­stant ac­cess ac­count if you think you may need im­me­di­ate ac­cess to some, but not all, of your nest egg.

In­vest­ments of­fer the po­ten­tial for a higher re­turn than sav­ings but in­volve a greater de­gree of risk. Be­fore you de­cide to in­vest, you should con­sider the im­pact of los­ing some or all of your money.

Typ­i­cally, the greater the re­turn you want from an in­vest­ment, the riskier the prod­uct, so you need to be care­ful that the level of risk you are tak­ing on suits your cir­cum­stances.

It is cru­cial that you re­view the charges as­so­ci­ated with in­vest­ments as th­ese vary de­pend­ing on the type of prod­uct you in­vest in. Think­ing about the ac­cess you will have to your money is also vi­tal, as well as fully un­der­stand­ing the terms and con­di­tions of the prod­uct.

If you need more help, you should con­tact an au­tho­rised fi­nan­cial ad­viser who will help you re­view your op­tions. A list of in­de­pen­dent fi­nan­cial ad­vis­ers is avail­able on the Cen­tral Bank of Ire­land’s web­site.

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