Q – I have € 137,000 surplus after repaying my mortgage from the sale of an investment property and am going to do nothing for at least 6 months to a year. Any ideas on where to put the money to make a gain for this short period ? Rates are still awful and I also need it to be safe. Maire – Limerick
A – Safety and preservation of your capital Maire – they are the two most important aspects to your query. Safety in that your funds MUST be guaranteed by the deposit taker to be repaid. All the Irish deposit takers are currently guaranteed by the government’s Deposit Protection Scheme up to € 100,000 per person per institution once the deposit taker is regulated by the Central Bank of Ireland and as it was the proceeds of a property sale, you would have 6 months’ capital protection up to € 1million ! Best demand account ? An Post Money at 0.75% – net 0.5075% after 33% DIRT Tax… The National Treasury Management Agency (NTMA) who look after the state savings on behalf of the government, including all An Post monies, offer safety and good value but their offerings are more long term. Take the National Savings Bond – it offers 4% tax free after a 3 year term which is equivalent to receiving 1.97%gross each year from a DIRT deducting deposit taker. Their 10 year National Solidarity Bond is the best deposit investment and offers 22% tax free on maturity ( equivalent to a gross rate of 3% each year ) In emergencies you only have to give 7 days’ notice to withdraw from these NTMA investments but lose out on the interest earned for that period. Best potential government deposit ? Prize Bonds – a joint venture with FEXCO, you cannot withdraw the first 3 months but then can cash them in after 7 days’ notice .. meanwhile you are in the draw from day one and could also win up to € 500,000 ! Minimum € 25 – maximum € 250,000 per person. Good luck.