Talk Financial

Frequently Asked Questions:

Frequently Asked Questions (2011)

a.) When will we see a recovery in investments?

We already witnessed a recovery from 2008 but markets remain volatile. The way to take on the markets is on a phased basis split over several months. Ideally, retain a monthly payment into markets. Though it sounds strange, the longer markets fall the better, if you are investing monthly and have time on your side. When recovery comes – and it will come – you will have a greater exposure to that recovery.

b.) When will we see a recovery in IRISH property values?

Not until the political landscape settles and our banks return to normal. Based on IMF rates of 5.8% average via the bailout, we expect rates will increase significantly in Ireland further hitting values. Unemployment will hit values leading to stressed sales and downward price pressure. It may be some years before we see property growth and that will be following a period of stable bottom-prices.

c.) What should I do in relation to my mortgage interest rate?

Due to the IMF/EMF bailout at 5.8% average interest, we predict variable rates in Ireland will exceed 7% (at least…) over the next two years and could exceed 8%. Therefore if you are concerned, and have some way to go yet in your mortgage, you should consider medium-term rate fixing if you have no likely chance to clear your debt.

Do not allow any bank pressure you to move off your tracker rate but just keep in mind that a tracker is not fixed. But the benefit of a tracker is you will not suffer from any Irish bank rate increase; only ECB increases … and they will increase too.

d.) Are there any opportunities in 2011 and beyond?

Of course there are! But you must have an appetite for risk for real growth. There are opportunities in global equity, emerging markets, BRIC markets (Brazil, Russia, India and China), commodities (driven by oil and gold) and green energy. These are all high risk but represent long-term growth prospects if you have the appetite.

There are also opportunities to invest in stressed property once the yield (rent etc), make sense. So look for properties in prime locations, with good rent whereby you are getting around 6-8% yields on residential and 10-12% on commercial.

e.) Are our Irish deposits safe?

In our view, if the Irish Govt guarantee is called in, we do not have the financial strength to stand over it. Therefore Irish deposits are not 100% safe in our view. There is a steady outflow of deposits away from Irish banks as we settle into 2011. If you have deposit money you would be advised to become aware of their financial stress and look at splitting your deposits between Irish and foreign banks located in Ireland.

f.) How can a financial advisor genuinely provide any help?

We can help by advising on all the above and giving you real direction. In case you are afraid of being sold, we offer Advice-Only service whereby we undertake to advise you with no execution. That way you are assured of sound advice with no fear in your mind of any sales agenda.

We also help you if you were mis-sold in the past, if you lost money due to poor advice or if you are under debt stress having been over-stretched by your bank.

Finally, we always focus on how to save you money. Perhaps we can re-price your protection or re-structure your pension and investments to maximise the amount actually invested, minimise your costs and if you work for yourself, redirect those costs to your business as a tax deductible rather than a growth drain.

As fee-based advisors, our focus is on you; not on sales. So you cannot lose by seeking our advice.

Can we help YOU? Contact us to find out - (091) 777 121.

Disclaimer
The above replies are the general opinion of Talk Financial Ltd only. We strongly urge no action without first getting direct personal advice on your circumstances. Talk Financial Ltd accepts no liability for any action anyone may take as a result of these views.