Depos**ts are Making You no Money

€92,000,000,000 – wow that’s a big number. That’s the estimated amount of money Irish savers have on Deposit. To put that into perspective, the same amount of minutes equates to over 175,000 years!

And guess what…Deposit rates are at historically low levels, banks are offering deposit rates close to .35% so the key is trying to beat inflation to at least preserve your money. Envisage if it did better and you actually made some money? Inflation has averaged about 2% a year in Ireland.

So was does this mean for me and you. We’re presented with inflationary risk, let me explain.

If you put €10,000 in a safe for 10 years and literally forgot about it, because everything else has risen by 2% a year (Food/Clothing/Fuel) etc., the real value of that €10,000 in 10 years is only €8,000.

The primary sources of Deposit Lump Sums that we see, tend to come from:

  • Redundancy lump sum.
  • Inheritance

Is there an alternative?

More and more of our clients are choosing to place their money in Low to medium risk investments as opposed to simply putting money in term deposit accounts or the post office/credit union. Getting their money working to let them to use it for the things that really matter to them or to simply accumulate to be used at any point in the future- e.g. College Fees, that trip of a lifetime, or that car you always dream of (*cough cough Vera – your new Jaguar) 

So how does it work? Cha-Ching


  • €10,000 Investment
  • Annual Average Expected Return from Low /Medium
  • Risk investment fund should be 3% a year approx.
  • Gross Annual Average Expected Return €300.
  • Net Annual Average Expected Return €177 (after Capital Gains Tax) is paid.

Shared with the low returns from deposits is the fact that tax for depositors is quite high, 41% DIRT plus 4% PRSI in most cases. DIRT is also calculated and taken yearly. Hopefully this will reduce in the coming years.

What I want to know is are you not better off having that extra €177 or letting the banks have it? (we will answer this one for you)

Did you ever hear of a thing called net interest margin? Well, it is the difference between what the bank pays you for depositing your hard earned savings and what they lend these savings out at. That’s right your Mortgage & Personal loans would be examples of this.

So what are the Negatives?

  • There is increased risk, i.e. the value of the investment could decrease.
  • There is a 1% Government levy applied to the fund in year one only. However we cover this charge.

The positives outweigh the negatives

  • Better potential returns.
  • Lower Tax rate of 41%.
  • Gross roll up, the fund is not taxed until year 8 or before if you withdraw, so you get interest on your interest.
  • Excellent management fees using Alpha Wealth as your independent broker – please try test us on this!


What percentage of your money a part of the €92,000,000,000 on deposit? If you have a lump sum that you have sitting on deposit that you are not expected to use, then it’s time to talk to us for clear concise, financial advice

Finance made simple so call into our office, 9 East gate, Little Island, and Cork for a cup of tea. To find out how to get your money working harder for you. Contact us today on 021 2061780 or email:


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