Blog – McCarthy & Associates – Galway Talks, 03/08/2016

Issue:  A staggering number of people retain old Life Assurance Savings Policies for years.

Comment:  It amazes me the number of people I come across who have these type of policies for periods ranging from 10-20 years and never had them reviewed.  In the vast majority of cases these plans provide poor value both in terms of the cost of the Life Cover the performance of the investment.

I would strongly suggest that you have the policy reviewed as it is likely that you might be better off to encash it.

Question:  I am considering buying a second property as an investment.  I have circa 30% of the purchase price and would have to borrow the balance.  What would be your opinion on this as an investment?

Answer: Since 2008 landlords experienced an increase in rental expenses. In addition the amount of interest you can write-off against rental income has fallen from 100% to 75%.

Therefore it is important to analyze the various costs (including taxation) which will affect your net return. Despite the uncertainty of any capital appreciation, this still has not dampened our love affair with property.

Investors need to realize once and for all that property is an investment that has considerable risks to it and is not a step that should be taken lightly without doing your homework.

Question:  Do Serious Illness Policies pay out on any illness?

Answer:  No.  A Serious Illness Policy will pay out on a certain list of predefined conditions and with certain policies that may depend on the severity of a particular condition before a claim will be validated.  It is very important that you do your homework on the type of policies available, as you cannot make an automatic assumption that if you contract a serious illness that a claim will be successful.