What Should I Do With My Inheretance.

[Naam]

good luck!

[shirtless]

If you go for Aussie banks you will not keep up with inflation, and in Thailand and any other countries the other financial wizards on tv fail to deduct your tax liabilities. Non resident tax in Australia 32%.

[Suradit69]

 

 

Simple maths will give you the answer, how big is your inheritance, 16 million baht?
 
16,000.000/100 = 160,000 * 3 = 480,000 baht per year/12 = 40,000 baht per month.
 
Thats assuming you can get 3% gross in Thailand.

Depends on his age,
16M,
spending 50k/month would last 25 years with no investment or interest.
spending 90k/month with 3% bank interest would last him 25 years.

One bad investment and it's all gone!

PS
Don't take any financial advice from foreign IFAs working illegally in Thailand.
No protection of any kind, best to seek advice in your home country.

 

 

Can someone please tell me, why would an IFA be working in Thailand and not lets say, Singapore or Hong Kong, both of which are internationally known centres of finance.

When was the last time anyone ever heard of Thailand or Bkk being known as an investor "hub"?
 

I am not allowed to name and shame some of the Mickey Mouse products being offered on these shores, its suffice to say, I wouldnt touch them with a barge pole.

 

Some <deleted> was trying to get me to invest in Bulgarian REITs, no thank you my good man.

 

 

People promoting Bulgarian REITs or other nonsense exist everywhere and people running investment scams exist even in the investment hubs including New York, London and  Singapore.  If someone doesn't have a bit of common sense, the Bulgarian REIT purveyors will find you anywhere ... as they apparently did in your case. Bernie Madoff and "Sir" Allen Stanford didn't operate out Bangkok and the people that they scammed considered themselves to be savvy investors, including major charitable organizations.

 

While I wouldn't rush to seek investment advice or investing opportunities either in Bangkok or Singapore, there are reliable, honest investment opportunities including those that will provide regular income streams even in Thailand.

Edited August 11, 2014 by Suradit69

[ldnguy]

If you want to invest and do NOT understand what you do - you will loose your money.

 

Whatever you do UNDERSTAND it for 1000%!!

Not true at all. You could understand something and still lose money. Or you could invest in something you don't understand and it could make money. It's the investment that makes or loses money, not your understanding of it.

 

Suppose two people invested in the same scheme. One understands it and one doesn't. They will either both make money or both lose money. It's the same investment. Their understanding of it has no bearing on it.

[Time Traveller]

 

 

One bad investment and it's all gone!

PS
Don't take any financial advice from foreign IFAs working illegally in Thailand.
No protection of any kind, best to seek advice in your home country.

 

 

Can someone please tell me, why would an IFA be working in Thailand and not lets say, Singapore or Hong Kong, both of which are internationally known centres of finance.

When was the last time anyone ever heard of Thailand or Bkk being known as an investor "hub"?
 

I am not allowed to name and shame some of the Mickey Mouse products being offered on these shores, its suffice to say, I wouldnt touch them with a barge pole.

 

Some <deleted> was trying to get me to invest in Bulgarian REITs, no thank you my good man.

 

The same reason Thai people open restaurants in foreign countries where there are few thai restaurants. Because Singapore and HK are oversaturated with finance "professionals", and the is a gap in the market for IFAs in Thailand to cater to the hundred thousand foreigners that live in Thailand.  

Edited August 11, 2014 by Time Traveller

[ronthai]

Good luck, keep in mind that all the new friends, that are coming, are not friends and some/most of the old friends are also not friends.

 

Don't invest or borrow to friends and/or Thais, unless you just want to give it.

[chiang mai]

If it was me in your situation:

 

I'd invest the funds safely at rate that kept place with inflation (or better) and do nothing more than that until I had a sound plan, your initial objective must be preservation of existing wealth on a low risk basis so spread the funds across a number of banks offering fixed rate returns. In Thailand you could get fixed rate deposits with UOB (fifteenth safest bank in the world) or Bank of Ayudyha, owned by Bank Tokyo and massively capitalized. 2.8% fixed rate deposits are available, tax free if you manage them properly plus you are not locked in to a specific period of time yet the yield remains available for the duration of the product..

 

If your inheritance is in GBP (?), probably a good idea to split it into one or two other currencies, SGD, CNY and RMB are good options. Remember, this is just a holding tactic until you get your investment plan sorted out.

 

Resist the urge to splurge, you can do that later, for the time being keep to your existing lifestyle.

 

Talk to as many people as possible to get ideas, internet forums is probably not the best place. Talk to IFA's in regulated territories such as the UK, get two or three different views - educate yourself so that you can detect B/S when you hear it.

 

Your plan, when you come up with it and you can take all the time you want, needs to show diversification across currencies, markets, products and risk levels, whatever you do, spread your investments.

 

AVOID all IFA's outside your home country, it's OK to bounce idea's off them but don't give them any business.

 

Avoid the gold addicts and don't get too involved in the story about how it's going to do this or that.

 

Pray often to a god of your choice, you need some luck also - best of..

 

 

Edited August 11, 2014 by chiang mai

[barry1312]

Doubt you'll get a great deal at the moment investing cash in any Euro bank with 0.15% interest rate, you may get a better rate with a lump sum locked up for three to five years with them

 

The best I can find at the moment in the UK for instant access is 1.5% maybe 2.5% for a lock in, Australia is much better but you may have to go there to open an account or have Australian address

 

Commerzbank do some capital guarantee funds where your original is guaranteed 100% and gains are linked to the performance of the stock market

 

Alternatively you can buy a mutual fund like JP Sterling Bond or Euro equivalent which invest in things like government bonds or corporate bonds, guilts etc I have some in there and has returned over 5% year to date but you need to watch they can go down as well

[ebean001]

no one would do what i would do but --- i would go to BBL and open a stock market trading acount. they will advise you on the stocks to buy to get maybe a 6% return. I buy MBKET, TTW, and BTS and get a very high dividend. the stock prices actually go up also.

It is somewhat fun to do also.

[al007]

do not worry, just send me the money and I will send you what you need each month!!!!!

 

OR go to large reputable international bank and seek advice

 

if the first choice appeals to you send me private message and I will give you contact details

[koo]

If you are about to receive a large inheritance and you have no investment/financial background yourself, you should consult a reliable professional.

 

Go to a reputable bank, and ask for their Private Banking services. Not only do they give advice, but they also make the calculations of proceeds for you (inflation adjusted, if needed) , and even do your taxes for you. They issue you credit cards and take care of your assets - worldwide.

 

A bank deposit is nearly certainly a way of losing money, because very often the rate is lower than inflation. Government bonds are pretty secure and you better prceeds than with a deposit account. If you invest 10 million baht in Kingdom of Thailand Bonds, you get an investment visa :-)   You can also consider trusts or even stock, but I would really consult the banker before doing that.

[chiang mai]

If you are about to receive a large inheritance and you have no investment/financial background yourself, you should consult a reliable professional.

 

Go to a reputable bank, and ask for their Private Banking services. Not only do they give advice, but they also make the calculations of proceeds for you (inflation adjusted, if needed) , and even do your taxes for you. They issue you credit cards and take care of your assets - worldwide.

 

A bank deposit is nearly certainly a way of losing money, because very often the rate is lower than inflation. Government bonds are pretty secure and you better prceeds than with a deposit account. If you invest 10 million baht in Kingdom of Thailand Bonds, you get an investment visa :-)   You can also consider trusts or even stock, but I would really consult the banker before doing that.

 

I would never use private banking for any purpose unless the sums involved were USD50 mill or more in order to get leverage, that order of magnitude at least. Do you really think that private banks care a toss about a paltry 16 mill, with all due respect to the OP.

[mrfill]

 

I was not thinking of investing it in Thai banks.

I might put in different banks around the world like a Swiss bank,a German bank and maybe an Ausie bank to spread my risks out.

 

Would I get more than 3% like that.

 

So are these maths right...300K @4%=12K Euros a year.

 

I don't know how much my inheritance is until the will is read and I will be back in Europe for that.

I will have to decide whether I have enough to retire or not when I know the amount.

 

If it's not enough to retire on I will need a plan B.

Is 4% a realistic rate for 5 year term deposits and are my maths right in saying I  need.

 

Thanks for the help so far.

your maths €300k*4%=€12k/p.a. is correct but your expectations are wrong. nowhere in €URoLand you get 4% for a 5-year term deposit. a fistful of banks are offering 2.00-2.20% but that with strings attached.

 

take a look at this website, it's in German but not a problem to read the information.

 

http://www.vergleich.de/online/festgeld-vergleich/#!MinPLevel=0&sort=!zins&betrag=300000&laufzeit=1800

 

 

In UK you can get 4.07% on a 7 year fixed bond with Leeds Building Society and 3.25% on a 5 year bond from INvestec. Both with protection on deposits up to £85000 and both in Europe. That took 30 seconds of searching, so I'm sure better rates can be found with a bit more diligence.
 

[Deacon Bell]

Consider inflation and foreign exchange rates.

 

Around 2005 (I'm not checking) it was around 70-72 baht to the pound. Thailand was also very cheap.

 

Many recently retired men moved over with their small 1000 pounds p/m pension, 72k p/m in Thai baht. Heaven.

 

10 years later, they're 10 years older, have worse health, and their 1000 pounds (if it hasn't been reduced) is down to less than 54k p/m while Thailand is far more expensive than it was 10 years ago. And that's after it's risen from around 47k p/m a year or so ago.

 

Thai banks can give you a return of at least 2.35% no problems, paid monthly, no fees.

 

That's worth looking at.

Edited August 11, 2014 by Deacon Bell

[Naam]

I would never use private banking for any purpose unless the sums involved were USD50 mill or more in order to get leverage, that order of magnitude at least. Do you really think that private banks care a toss about a paltry 16 mill, with all due respect to the OP.

there is private banking and there is private banking. both with infinite different versions and advantages depending on the individual bank and its jurisdiction.

 

edited for addendum:

 

and if want service for any purpose of investing private banking provided by a multinational (not a private) bank is an absolute must because 'normal' banks have to many restrictions and only provide a fraction of all available investment possibilities.

 

most restrictions are a burden of the regulator. in SG it's the MAS - Monetary Authority of Singapore which rules with a heavy hand.

 

but for the private banking as i mentioned you don't need USD 50mm. in Singapore the "paltry" sum of USD 3-5mm will open the door

 

 

Edited August 11, 2014 by Naam

[Muhendis]

Krugsri have a nice account with 3.5% interest. Thats where I put my 800K retirement lump. Interest is paid monthly but it is not compounded so you have to have it out every month into a cash account.

[Deacon Bell]

If you invest 10 million baht in Kingdom of Thailand Bonds, you get an investment visa :-)   

 

Invest 40m here and you can buy 1 Rai of land in your own name. 

[Naam]

Consider inflation and foreign exchange rates.

 

Around 2005 (I'm not checking) it was around 70-72 baht to the pound. Thailand was also very cheap.

 

Many recently retired men moved over with their small 1000 pounds p/m pension, 72k p/m in Thai baht. Heaven.

 

10 years later, they're 10 years older, have worse health, and their 1000 pounds (if it hasn't been reduced) is down to less than 54k p/m while Thailand is far more expensive than it was 10 years ago. And that's after it's risen from around 47k p/m a year or so ago.

 

Thai banks can give you a return of at least 2.35% no problems, paid monthly, no fees.

 

That's worth looking at.

2.35% is by far not enough to compensate for an overall inflation rate estimated @ 6%. based on that estimate the purchase power of today's THB 50k will be diminished to

 

-THB 35.5k in 10 years,

-THB 28.6k in 15 years

and

-THB 23.8k in 20 years. 

 

read and weep or educate yourself how to manage your money to achieve more yield

[Muhendis]

Krugsri have a nice account with 3.5% interest. Thats where I put my 800K retirement lump. Interest is paid monthly but it is not compounded so you have to have it out every month into a cash account.

Sorry. Forgot to add that the cash account I have is also with Krungsri (spelt it right this time) which pays 2.1%

[akentryan]

5,000,000 baht at Krung Thai Bank at 3.44% for 44 months will get you 14,500 per month.

That offer expired Aug 31 but before that they offered 60 months at 4%.

The best current rate I know of is 3.25% at UOB.            

Keep in mind a couple of things: 1) If you have a large amount to deposit the fixed rate is negotiable usually .10 or .20 per cent higher, 5 mil at some , 10 mil at others

2) File a Thai tax return and get most or all of the 15% tax withheld refunded.

The big banks seem reluctant to make monthly payments and prefer quarterly or at maturity.

They also advertise BS rates. One is now promoting a 4% rate but if you check it out it is 4% for the 13th and final month of the deposit. The real rate is 2.8%

Do your homework

[Naam]

 

If you invest 10 million baht in Kingdom of Thailand Bonds, you get an investment visa :-)   

 

Invest 40m here and you can buy 1 Rai of land in your own name. 

 

and then plant potatoes to make a living?

[khunPer]

1,000 euro/month = 50k baht/month x 12 = 600k bah/year

2.5% net interest/dividend and 2% annual inflation, 20 million baht (400,000 euro) will last 35 years, last year your annual payout will be 1,176,406 baht and the remaining balance 335,000 baht.

 

With 35 million baht (700,000 euro) in the deposit and same conditions, you will still have 35 million baht after 35 years.

[side]

It's a nice problem to have.

 

Study the various investment tools online, its all there, you just need to read and understand. If you have a friend in the finance business, buy him a drink and have a long talk. Here are a couple of tips for what they're worth:

 

1) money in the bank will not keep up with inflation, ie it will likely shrink in value, furthermore, even fixed term deposits don't pay great interest. A good place to park money safely while figuring out what to do though as someone already pointed out.

2) Diversify across investment types, currencies and markets

3) Seek one point of investment with lowest possible costs (take a look at the swissquote website for example)

4) Based on your age and financial needs, create the right weighting on bonds, shares, real estate etc

 

Some relatively high yield areas to invest which spring to mind: REITs (HK, SGP, London, NYC), also, buy a couple of studios to rent out (potential ROI to seek 4% - 7%+). I would have those two investment vehicles in the portfolio alongside some low cost index tracker funds (S&P, Nasdaq, FTSE, DAX, SGP, HSI etc) and some higher yield monthly distribution unit trusts (bond and stock funds mix 'em up).

 

The list is almost endless and I understand your confusion, but you really just need to sit down and study this stuff on the internet and talk with friends.

 

Hope that helps.

 

[Naam]

1,000 euro/month = 50k baht/month x 12 = 600k bah/year

2.5% net interest/dividend and 2% annual inflation, 20 million baht (400,000 euro) will last 35 years, last year your annual payout will be 1,176,406 baht and the remaining balance 335,000 baht.

 

With 35 million baht (700,000 euro) in the deposit and same conditions, you will still have 35 million baht after 35 years.

 

2% annual inflation

in Thailand???
 

[johnopolo]

You seem to have received lots of advice here and most of it looks pretty good.

 

However, there's one critically important rule that you must NEVER break: do not EVER give your money to a third party to invest on your behalf. Get advice by all means but place the investments directly yourself.

[Naam]

 

With 35 million baht (700,000 euro) in the deposit and same conditions, you will still have 35 million baht after 35 years.

that is correct but the purchase power based on 2% inflation will be a mere Baht 17.257 million after 35 years.

 

4% inflation = Baht 8.39 million

 

6% inflation = Baht 4.01 million

[JacChang]

Wow, too many noises, 1/4 good sound advices, the rest..... :S

 

OP

I am a full time investor, retired, living off dividends. And there are also a few others here that I know from TV. These are the people you need to get information and advice from. Do not, I repeat, do not, get information from any "professional" or banking specialist. These people work for the industry and take orders from their heads. I know, and have some friends who admit these to me. The products they try to sell me, are not because of their professional advice, it is what the heads tell them to do so for their own banking requirements (mutual funds need more money, they want a particular investment to go up, etc.) They are sales, not investment guru. Outsiders might feel that these bankers can choose from over 300 mutual funds, and choose the best for you according to your circumstances. Wrong. Their managers, brief them during the meeting, customers are categorized into 2-3 categories. Low risk, medium risk, high risk. If low risk, provide them with so and so mutual fund, etc. That man/woman sitting in front of you does not have in depth knowledge of the investment itself. It is pure memorization, sales, and presentation to the customer. Often, 80% of the time, these "investment advices" are at the high end of the technical graph.

 

Investment advice requires no money. The best investment advices are free. From people, from the internet (do filter out what is truth/false), and books. Paid advices are fake. Simple question. Ask the banker, do they invest what they recommend? "Ohhh... ummm I don't have money/its too risky" BS. Ask the professional, if they are so smart in this field why do they need that fee of 10 dollars, 20 dollars? That's right, they are sales. Paid to say the right thing, to look smart and intelligent in order to earn your little money. They are nothing than rats. This apply to local banks, investment firms, and your securities broker "advisor". The only money I ever paid on my journey, is the securities transaction fees/costs/taxes. None for advice. You can go ahead and label them as scams. Most successful people I've known, they give free advice like I do. Why? Because it's our passion in investing, it's not a job. We make so much money, we are genuinely happy to get to know other investors and share advices. There is no need to acquire fees, what a joke.

 

You have no provided us with a number of your inheritance so I'll give the following advice in general.

1) Local Banks Savings Account

You need to put 6 months of expenses you will require here. About 2-3% of total assets? Depending on what you have. The purpose of this is to have access to immediate funds, but aim for the lowest possible here, because it produces basically no returns.

 

2) Money Market Mutual Funds/ Non fixed deposit account

This is your emergency fund, in case something big happens, requiring more than your savings can provide. A car accident, a surgery operation, sudden need for something. About 300,000-500,000? Remember, each account has a specific purpose. You have a knife, a pistol, and a rifle. Would you use a rifle in an elevator? No, it's slow, a knife would instantly kill. Would you use a pistol for long range? No, you would miss all your shots even if you are good at aiming. #2 is a back up to #1, but it offers a higher return than #1. But it's liquidity is usually a day.

 

3) Time deposits

Prepare a Time deposit for years up to 3-5 years.

You could divide them semi annually. Many people think time deposits are merely a safe investment with 2-3% returns and that's it. No they are not. They are an advance planning of your income to be used in the years ahead. Some will object this, but hear me out. Most people go to banks and put a lump sum of their money 1 mil, 2 mil, what have you, and lock it away for 3 years. Then repeat the same process in 3 years if they don't need the money. While I will not say it is wrong, it will label it as "not efficient". If you need 50,000 per month, that's 600,000 per year. In 3 years, that's 1,800,000. I would put 12 months 300,000. 18 months 300,000 etc. Until 36 months 300,000. Every 6 months in the near future, money arrives at the right time to replenish the savings account, and it uses the best returns possible in that given time frame. Remember, as you continue this process, you will realize in the end, all your 300,000 are in 36 months. You put in Aug 14(Matures Aug2017), you put Feb 15(Matures Feb2018), and so on. You will have money coming in every 6 months, ALL at the 36 months rate. You will feel like you are getting a 6 month time deposit at the rate of 36 months. So prior planning is always a benefit.

 

4) Mutual funds in bonds

I use trading economics, you can google it yourself. It lists the world's interest rate and inflation. Of the whole list of the countries, I can say, I would probably only invest in bonds of 10 countries the max. What to look for? 1) Interest rate > Inflation  2) Inflation of that country vs the country you are in

Most experienced investors will know what I am talking about. Russia has 8% interest. Am I happy? No. Because their inflation is 7.5%. You may say you gained 0.5%. But I don't stop there. Russia's inflation is 7.5%, Thailand is at 2.16%. Whose money do you think will depreciate faster? If you money enters Russia, it surely must return to Thailand when it matures for you to use. That's where comparative inflation rates can be important as well. So my bonds? All must pass those tests. They do exist, but not easily found. And they pay monthly dividend at 4-5%, no surprises. Don't go for junk bond. Get majority government bonds and treasuries. Junk bonds, extra 1-2% gains but at the expense of 50-100% increase in risk. Worth it? Not in my eyes.

 

5) Stocks, my favorite

This... will be continued. Tired

 

 

 

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

 

O.K.

I did think of just blowing it but I am not yet 50 so that wouldn't work.

 

I know  that if I put it in an ordinary savings account I couldn't live off the interest.

So I'm trying to find out if I can live off the interest if I put it into long Term deposit accounts and laddering the accounts so as one account matures every year.

 

What I didn't consider was Idnguys' point that if I do that outside Thailand I could get caught out by currency exchange rates.

I need to get advice that is "farang in Thailand"specific.

 

Do Thai banks do these kind of accounts and would it be safer to take your chances with the exchange rates than with the Thai economy.

 

Also, are there professionals in Thailand that could be trusted to advise on these matters.

 

I do have some serious learning to do...........and that's what I'm doing.

No professionals can be trusted. It's a job occupation, not something they have a passion for. If it was, they wouldn't be miserable at their desks. People talk about risks, I understand risk, and avoid risks, therefore there are little or no risks in investments. You need to start investing in your knowledge, and remember only you can make decisions. NEVER ever let someone force you or pressure you into buying something. Good investments don't work that way, it never did. You can gather information only from sources, and the decision lies within you. Remember that sentence.

 

no one would do what i would do but --- i would go to BBL and open a stock market trading acount. they will advise you on the stocks to buy to get maybe a 6% return. I buy MBKET, TTW, and BTS and get a very high dividend. the stock prices actually go up also.

It is somewhat fun to do also.

 

+1

Stocks are one of the safest investment with full control. I too, have TTW, been 3 years now, probably 60-70% in capital gains so far, but I am never going to sell it. Never.  Enjoying my 8.7% dividend per year for the rest of my life. I don't have bts, but I hold btsgif. Inflation linked, prices keep going up, ridership keeps going up, my dividends keep going up   Life is good.

We can have more chat sometime.

[KhnomKhnom]

Join with me and lets make movies !!!  Thai love ghost stories.

[Estrada]

Invest in the Thai Stock Exchange. I had invested B6Million in 2009 and I have made B30Million profit in 5 years. You have to know what you are investing in so get a good broker such as Maybank Kim Eng. Their commision is only B0.17 if you have an online SET investment account. You can use a PC or 3G mobile phone to follow you portfolio whereever you are in the world where you can get a connection by mobile or internet cafe. I stick to shares with a dividend of around 7% such as BTS, Intuch, Advance and especially when there is an upside to valuation of 20-40% or more.

 

If you want to invest in equities but do not want to do it yourself then I suggest Bangkok Bank's brokerage arm, Bualuang Securities and buy into one of their SET managed investment funds.

 

The important thing to remember about investing is that you should buy low and sell high. To many people buy high and sell low when they panic. Usually stock prices fluctuate up an down but the trend is usually up at the end of the day, with the blue chip stocks. For instance BTS went from B8 to B9.20 when I sold and then soon after retreated gradually to B8 due to the political situation, when I bought again. In the last few days it has reached B9.20 again as well as paying another dividend of 4% for the half year. So that is a 19% return on investment for 6 months. BTS guarantee a dividend of 8% next year and 9% the following year. The is no capital gains tax yet on investment and only a 10% witholding tax on dividends.

 

Avoid investment consultants like the plague.

[AnotherOneAmerican]

Good advice,I will find a good broker when I go home.

 

Are there any brokers in Thailand you would recommend.

 

Foreign financial advisers (and other financial service providers) are not allowed to work in Thailand.

So the only ones you can find are working illegally and not registered with the Thai SEC.

 

You can use a Thai broker, but again under Thai law, nobody could warn you if he were a crook.

 

Unfortunately Thai VISA forum rules prohibit anyone warning you against crooks (no name and shame)

Best to use someone in your home country, who is correctly registered with the financial authorities, and not an illegal worker.. 

Edited August 11, 2014 by AnotherOneAmerican