Welcome to the weekly Financial Column in association with Moneyplus, Bridge Street, Boyle.
Q. I am planning to buy a house in the medium term. I need to start saving for the deposit. Where is the best place to save ?
A. Yes, there are two very good reasons to start a savings plan early when planning to buy a house and secure a mortgage. I am assuming you are a first time buyer.
Firstly, a 10% deposit is required up to a purchase price of 220k and 20% on any amount over that. (5% of the deposit needs to be evidenced by regular savings), the remainder can come from a gift or sale of an asset, (but not from borrowing). Secondly, you need to prove that you can save a sum equal to the potential monthly mortgage repayment, less any rent you are paying at present, provided it is paid from your bank account.
Most institutions offer a regular savings product. Rates vary from 3% with EBS down to less than 1%. There is restricted access on EBS , however most of the others have an instant access product. RABODirect and Bank of Ireland offer an online account. RABO require 90 day’s notice of withdrawal and Bank of Ireland require 7 days notice. Their current rates are 1.45% and 1.35% respectively. KBC are the best Instant access provider with a rate of 3% if you are a KBC current account holder, and 2% if not.
As you can see deposit rates are very low. For this reason we recommend deposits such as these for short term saving only. If you have a lump sum or can save for a period up to 5 years, you should consider a longer term investment. Advice on such investments should be sought from an Independent financial adviser. At MoneyPlus we are available to provide such advice and would be delighted help you.
If you have any financial questions you would like answered in this column please submit details in confidence to [email protected]
Money Plus are experienced investment and financial brokers and have been in the business of financial and investment planning for many years. They are dedicated in providing bespoke financial planning advice to clients. If you would like further advice on the above or any other financial information please contact Belinda McCauley in our Boyle office on Bridge Street on 071 9194000 or [email protected]
Boyletoday.com/MoneyPlus accept no responsibility for any decisions taken as a result of advice provided in this column. A reliable recommendation can only be made following a full detailed consultation taking an individual particular circumstances into consideration
