What Should I Do With My Inheretance.

[glitteratzzi]

uhmmm can I borrow 70k baht for my thai citizenship??? no, I'm serious =|

[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.

 

2% annual inflation

in Thailand???
 

 

Naam, we don't know the inflation on long term can be less than 1 percent a year, can be more than 10 percent…?

Bank interest will normally follow inflation rate variations to a certain degree. Annual recorded inflation rate for Thailand in July 2014 was 2.16 percent; government says expected inflation to be 2 percent.

 

OP asked:

»The first option I'm trying to understand is leaving it in the bank.Can anybody help me do the maths.

How much would I need in the bank to draw 1000 euro a month and keep up with inflation and not let my original amount decrease.«

 

– and I made a calculated suggestion; however I think it is fairly impossible to keep both payouts and capital safe from inflation in a bank deposit without an extremely high start capital; OP did not says how much…

–and I'm not giving any advise...!

[solstan]

You would probably be best of with a mix.

Some of the money in long term saving account should give a return between 2 and 3% - with a small bit of negotiation.

 

To make more profit you need to buy som kind of papers... and that will be at a smaller or bigger risk.

 

 

DO NOT put all of it in thai banks as they might consider your whole or part of the investment as a contribution to the state in the future ... maybe not now, but a special tax might be targeting extra wealthy people, like in Malta ...

 

Some banks have a upper limit of say 1 million in local current as the highest sum the the state will help the bank to guard against bankrupcy.

 

 

Once you have the Money, talk to at least three banks and compare their offerings!

 

[Geordie59]

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.

Fixed term deposits will vary depending on the currency invested in.
No need to have different account in different countries. Any decent international bank will have investments in various currencies.

[thrilled]

I have A schwab brokerage account.I have a lot of dividend paying stocks.The dividends are from 4-6%. That means I average about 5% interest A year.A million dollars will bring you $50,000 A year.
If I was you I would get A good financial advisor.Let him to the hard work for you.

[Robert24]

I like the advice given from side and jacchang. Key is to diversify. Usually I recommend 20% cash/money market, 20% bonds, 20% equities, 20% precious metals/ commodities and 20% Real Estate. Depending on your situation you can go overweight in an asset class if you think it is cheap or underweight if an asset class becomes expensive. And you should not forget to rebalance (bring your portfolio back in line with the targeted % in each asset class as valuations change with time) your portfolio on a regular basis. Obviously important also define how much risk you want to take, so you can decide what type of products to buy in each asset class.

Happy to provide more input if you would like. Been investing for 30 years and have established some experience.

[wooloomooloo]

How much would I need in the bank to draw 1000 euro a month and keep up with inflation and not let my original amount decrease.

 

This is some serious backward math.  Starting from what?  The mind boggles.

 

Is this some braggart thread perchance?

 

 

 

[RandomSand]

Example #1

 

You invest Eur$ 420,000.00 in a Stock Fund.

You buy the stocks when they yield 3% dividend (share of the annual profits).

That's Eur$ 12,600.00 per year or Eur$1,050.00 per month.

 

You still have your lump sum and the dividend should rise with inflation.

 

Example #2

 

600,000.00 in stock market.

You buy the stocks when they yield 6% dividend

Eur$ 36,000.00 per year or Eur$ 3,000.00 per month.

 

Some people will cry "The stock market will crash" and they might be right but you can think that you're "buying the yield" and not worry too much about the ever changing valuation.

 

However; earnings might go drop in a recession...

 

So; Many people prefer to purchase buildings, for investment, and lease them out for rental income as they don't trust the stock market or are aware of the pitfalls of trying to time the market etc.

Edited August 11, 2014 by RandomSand

[jacko45k]

I might start by being a little wary of telling all and sundry about your good fortune.

After having looked for good returns for many years I have learned 'Do Not Trust Anybody'.....

I would be a rich person today if investment consultants were not liars.

 

The whizz-kid who had such promise is now serving time!

 

Bank deposits mean you are subject to interest rates, it was the summary collapse of those that forced me into more risky areas.

 

Proceed with caution.

 

 

[Naam]

Naam, we don't know the inflation on long term can be less than 1 percent a year, can be more than 10 percent…?
Bank interest will normally follow inflation rate variations to a certain degree. Annual recorded inflation rate for Thailand in July 2014 was 2.16 percent; government says expected inflation to be 2 percent.
 
OP asked:
»The first option I'm trying to understand is leaving it in the bank.Can anybody help me do the maths.
How much would I need in the bank to draw 1000 euro a month and keep up with inflation and not let my original amount decrease.«
 
– and I made a calculated suggestion; however I think it is fairly impossible to keep both payouts and capital safe from inflation in a bank deposit without an extremely high start capital; OP did not says how much…
–and I'm not giving any advise...!

inflation is indeed an individual "thingy" khunPer. if the price for rice, chicken, pork and noodles go up 5% p.a. an unskilled Thai workman making 8k Baht/m and feeding a family of 4 hurts whereas the Farang family with a disposable income for food of 40k Baht/m hardly realises that kind of inflation.

Can anybody help me do the maths.
 
How much would I need in the bank to draw 1000 euro a month and keep up with inflation and not let my original amount decrease.«

this question is impossible to answer because of the two unknown variables "inflation" and "exchange rate". both variables render the original €UR-capital irrelevant as the €UR might buy in 10 years time 60 Baht or perhaps only 20 Baht.

however I think it is fairly impossible to keep both payouts and capital safe from inflation in a bank deposit without an extremely high start capital

keeping any amount of capital safe from inflation is only possible if the yield matches or exceeds the payouts plus inflation.

[choochoo]

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.

5 year term get you 2.3% at CIT online bank.   PM me and ill help you get started................lol.

[choochoo]

I have A schwab brokerage account.I have a lot of dividend paying stocks.The dividends are from 4-6%. That means I average about 5% interest A year.A million dollars will bring you $50,000 A year.
If I was you I would get A good financial advisor.Let him to the hard work for you.

A good advisor will laugh @ $1,000,000 bankroll.......................hahahaha!

 

 

OP is best advised to do nothing and learn.by hisself.

[USNret]

Rule #1: Don't seek investment advise on a forum that features grumpy old opinionated expats.  Get serious.

[robertson468]

 

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

 

Excellent advice.  There are a lot of very bad people out there who will have already ready your piece and rubbing their hands with glee at the thought of parting you from your no doubt well deserved inheritance.  Read up as much as you can, which you seem to be doing and then find out what investment your "trusted friends" are doing if they have a large capital sum.  Failing that, go and see several banks in yoiur home Country and then make a comparison of what they have to offer.  Good luck.  If all else fails investment in property can bring you a good income and over time should appreciate in value, unless you are living in somewhere like Iraq, Palestine and somewhere like that .

 

 

Edited August 12, 2014 by robertson468

[GuestHouse]

I wonder how many 'Private Messages' the OP has received with offers to help him with is investments?

 

 

My own advice. 

 

You clearly do not have much understanding of investing. Therefore I would strongly advise you place your money on term deposit in a bank in your own country until you have chance to read and learn a lot more about investing. 

 

Whatever you do - Do not take up the services of any financial advisers in Thailand 

 

I also advise you not to bring more money to Thailand than you need for your day to day needs (perhaps two months spending extra cash saved in a Thai bank). 

 

Any money you bring to Thailand will stay in Thailand - even if you have to leave. 

 

 

As for reading a book on Starting and Business in Thailand - Do not waste your time - start reading up on investments in your own country where you at least have some protections under the law. 

 

And one last piece of advice - Never ever tell anyone in Thailand how much money you have.

[chiang mai]

As if Thailand is some kind of one way sponge, goodness me! Many of us have made more money in Thailand than anywhere else in our lives, it's not that hard, once you get over the stigma!

[puukao]

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.   - JacChang.  

 

While this is good advice, it can be tricky.  Free advice, "Give money to a hedge fund manager in Thailand."  See, this is NOT good free advice.  Read a book?  "How to make a million trading penny stocks."  Again, not good.  Filtering out truth is impossible.  

 

Anyhow, everyone will want to make some money off you.   Buying CD's in a bank, they won't tell you other rates in other banks.  why?  they don't get the business.  muni bonds good since no taxes (to a point) but rates are pretty low now (might go lower, who knows).  dividend stocks can pay 6% and then the stock can lose 50% of it's value.  yes, anything can happen.  

 

if you are super nervous, and say you live in USA (sorry, maybe UK, forget) then put it in some massive bank (insured up to 100k FDIC) and ladder up some muni bonds from your home state.  5% tax free effective yield, roughly, and get 3,000k ish a year on 100,000.  is it good?  no, but you will sleep.

 

if you really want it to grow.....well, i don't know you, so i'm really not going to offer more riskier strategies.  

[GuestHouse]

As if Thailand is some kind of one way sponge, goodness me! Many of us have made more money in Thailand than anywhere else in our lives, it's not that hard, once you get over the stigma!

 

I've made a great deal of money in Thailand (15 years on a full expat deal) but I ship almost all of it back to the UK - I know very very few people who have made money in Thailand with businesses - almost all those I do know who have made money running businesses in Thailand came to Thailand with past experience of running businesses. 

 

The OP clearly has no such experience and little or no understanding of investment. 

 

 

But, I'm sure there are plenty of expat financial advisers willing to help out - They probably claim to have made fortunes in Thailand, but I'm not convinced. Thieving other people's pensions and savings is not 'making money'.

[chiang mai]

 

As if Thailand is some kind of one way sponge, goodness me! Many of us have made more money in Thailand than anywhere else in our lives, it's not that hard, once you get over the stigma!

 

I've made a great deal of money in Thailand (15 years on a full expat deal) but I ship almost all of it back to the UK - I know very very few people who have made money in Thailand with businesses - almost all those I do know who have made money running businesses in Thailand came to Thailand with past experience of running businesses. 

 

The OP clearly has no such experience and little or no understanding of investment. 

 

 

But, I'm sure there are plenty of expat financial advisers willing to help out - They probably claim to have made fortunes in Thailand, but I'm not convinced. Thieving other people's pensions and savings is not 'making money'.

 

 

 

If indeed you have shipped back all your earned THB, you've converted it back into Pounds and in the process, over that period, you've lost huge amounts. On the other hand, a retired expat who came here fifteen years ago, bought his home and his new car, perhaps invested in a rental property also, invested for income in the SET, to a similar extent that a Brit might invest in the FTSE, has at least doubled their investment and probably paid zero tax in the process. I refer of course not only to exchange rate gains but also increases in capital values and the SET.

 

But to do those things require a person to get over the myths and the rumor mongering that one should only bring as much money into Thailand as one can afford to loose!

 

Hint: none of the above requires the services of an IFA, bogus or real.
 

[Nuddy]

Troll

[GuestHouse]

 

If indeed you have shipped back all your earned THB, you've converted it back into Pounds and in the process, over that period, you've lost huge amounts. On the other hand, a retired expat who came here fifteen years ago, bought his home and his new car, perhaps invested in a rental property also, invested for income in the SET, to a similar extent that a Brit might invest in the FTSE, has at least doubled their investment and probably paid zero tax in the process. I refer of course not only to exchange rate gains but also increases in capital values and the SET.

 

But to do those things require a person to get over the myths and the rumor mongering that one should only bring as much money into Thailand as one can afford to loose!

 

Hint: none of the above requires the services of an IFA, bogus or real.
 

 

 

What's all this about earning THB and converting it back into Pounds? 

 

You'll be telling me next professional expats are expected to live on their salaries?

 

 

You really do not understand what a full expat package is do you?!

[chiang mai]

 

 

If indeed you have shipped back all your earned THB, you've converted it back into Pounds and in the process, over that period, you've lost huge amounts. On the other hand, a retired expat who came here fifteen years ago, bought his home and his new car, perhaps invested in a rental property also, invested for income in the SET, to a similar extent that a Brit might invest in the FTSE, has at least doubled their investment and probably paid zero tax in the process. I refer of course not only to exchange rate gains but also increases in capital values and the SET.

 

But to do those things require a person to get over the myths and the rumor mongering that one should only bring as much money into Thailand as one can afford to loose!

 

Hint: none of the above requires the services of an IFA, bogus or real.
 

 

 

What's all this about earning THB and converting it back into Pounds? 

 

You'll be telling me next professional expats are expected to live on their salaries?

 

 

You really do not understand what a full expat package is do you?!

 

 

I was on the full expat package for many years so I do have some idea, the point is that an expat has the opportunity to earn where they live, the currency opportunities are enormous. For example, in Hong Kong some years ago, we had the opportunity to take the standard hotel accommodation and the per diem or to take cash instead. One of us chose the latter, bought a flat in Midlevels and rented it out when the work ended a few years later.

 

Another part of professional expat life is that we can chose where our salary is paid, typically many would use an umbrella company and also the currency that is output from it, if people chose Sterling whilst living in Thailand, that's their problem..

 

But we digress, the point of my earlier remark is about people having the guts to invest in anything other than their home currency. The old mantra of only bringing into Thailand, funds you can afford to loose, has cost many people lots of money, foreign currencies have strengthened whilst the Pound, Dollar and Euro have fallen in value and many have suffered because of a phobia, sad really.

 

[Naam]

 

 

If indeed you have shipped back all your earned THB, you've converted it back into Pounds and in the process, over that period, you've lost huge amounts. On the other hand, a retired expat who came here fifteen years ago, bought his home and his new car, perhaps invested in a rental property also, invested for income in the SET, to a similar extent that a Brit might invest in the FTSE, has at least doubled their investment and probably paid zero tax in the process. I refer of course not only to exchange rate gains but also increases in capital values and the SET.

 

But to do those things require a person to get over the myths and the rumor mongering that one should only bring as much money into Thailand as one can afford to loose!

 

Hint: none of the above requires the services of an IFA, bogus or real.
 

 

 

What's all this about earning THB and converting it back into Pounds? 

 

You'll be telling me next professional expats are expected to live on their salaries?

 

 

You really do not understand what a full expat package is do you?!

 

any professional who spends his full package on living expenses is not a professional

 

many rainy seasons ago, when i was an expat, rule of thumb was spending 10-15% and having 85-90% transferred to a selected bank account where it piled up. but i'm not sure whether a setup like this is nowadays possible (local income tax, OECD regulations, FàrTCA, etc.).   

[GuestHouse]

 

But we digress, the point of my earlier remark is about people having the guts to invest in anything other than their home currency. The old mantra of only bringing into Thailand, funds you can afford to loose, has cost many people lots of money, foreign currencies have strengthened whilst the Pound, Dollar and Euro have fallen in value and many have suffered because of a phobia, sad really.

 

 

 

I have a theory, and I admit it is not backed up by hard statistics, but then neither is the argument against my theory - That if we take the total amount of money expats have made in Thailand and subtract the total amount of money expats have lost in Thailand, the result will be a negative. 

 

As for the currency comparison: It only becomes an issue if assets are held in one currency, or indeed in non growing investments. 

 

And there remains the whole issue of 'Investment Advisers' in Thailand - Carpet baggers sponging off people who are ill informed of the risks. 

 

The OP has announced he has a windfall coming his way - He would be well advised not to bring that to Thailand until he understands a lot more about investment and Thai laws - he would be extremely well advised to avoid doing any investment with financial advisers in Thailand.

 

If you disagree with that advice, don't simply disagree rubbish it - explain exactly why it is wrong.  

[choochoo]

invest in Yoghurt shop--high end of course!!!!!!!!!!!!!!

[saroq]

 

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.

 

Be very cautious taking advice from people who call themselves Independent Financial Advisers (IFA).  Most aren't independent and most are glorified salesmen/women who are just flogging a product.  Most haven't got a clue about the workings of financial markets and have probably never bought or sold a share in their lives. 

[chiang mai]

 

 

But we digress, the point of my earlier remark is about people having the guts to invest in anything other than their home currency. The old mantra of only bringing into Thailand, funds you can afford to loose, has cost many people lots of money, foreign currencies have strengthened whilst the Pound, Dollar and Euro have fallen in value and many have suffered because of a phobia, sad really.

 

 

 

I have a theory, and I admit it is not backed up by hard statistics, but then neither is the argument against my theory - That if we take the total amount of money expats have made in Thailand and subtract the total amount of money expats have lost in Thailand, the result will be a negative. 

 

As for the currency comparison: It only becomes an issue if assets are held in one currency, or indeed in non growing investments. 

 

And there remains the whole issue of 'Investment Advisers' in Thailand - Carpet baggers sponging off people who are ill informed of the risks. 

 

The OP has announced he has a windfall coming his way - He would be well advised not to bring that to Thailand until he understands a lot more about investment and Thai laws - he would be extremely well advised to avoid doing any investment with financial advisers in Thailand.

 

If you disagree with that advice, don't simply disagree rubbish it - explain exactly why it is wrong.  

 

 

In my post number 37 in this thread I already suggested some of those same things, where we do not agree is on whether expats should bring funds into Thailand for investment purposes. When I say investment I refer to fixed rate deposit accounts spread across the larger banks, simply, those banks are very safe and the yields on offer are far better than any fixed rate product of a comparable term in the West. I also refer to investment in the SET but not to a substantial degree, if a person were inclined to invest in the FTSE there would be little difference between that and investing in the SET.

 

And I think we can safely assume the OP's holdings are in Sterling, we all have our views on whether that is wise or not, I think it is unwise but let's leave that as a second debate sometime, realistically Asian currency offer far greater opportunity for growth than does Sterling and that seems to be widely agreed.
 

Finally, your opening theory: it seems a little self serving so as to support your distrust of investing in Asia and certainly can't be proven either way. Anecdotally, I made a number of capital purchases in Thailand at 75 Baht to the Pound, mostly real estate and cars, the stronger the Baht becomes the more money I make on those things although the car account has almost run its course having been renewed several times - so no loss there. Fixed rate deposits: no loss there since all the banks survived and I've lost nothing on my SET investments because I don't sell over the short term. I know that others in this forum, notably Fletch, have seen substantial gains on the SET over the past fifteen years, returns in excess of 1,000% so no loss there either.

 

Finally finally, my cash assets were 50/50 in the Thai Baht, I upped that to 75% recently and I intend to be all in by the end of the year, just so that you understand I do have the courage of my convictions.

[GuestHouse]

In my post number 37 in this thread I already suggested some of those same things, where we do not agree is on whether expats should bring funds into Thailand for investment purposes. When I say investment I refer to fixed rate deposit accounts spread across the larger banks, simply, those banks are very safe and the yields on offer are far better than any fixed rate product of a comparable term in the West. I also refer to investment in the SET but not to a substantial degree, if a person were inclined to invest in the FTSE there would be little difference between that and investing in the SET.

 

And I think we can safely assume the OP's holdings are in Sterling, we all have our views on whether that is wise or not, I think it is unwise but let's leave that as a second debate sometime, realistically Asian currency offer far greater opportunity for growth than does Sterling and that seems to be widely agreed.
 

Finally, your opening theory: it seems a little self serving so as to support your distrust of investing in Asia and certainly can't be proven either way. Anecdotally, I made a number of capital purchases in Thailand at 75 Baht to the Pound, mostly real estate and cars, the stronger the Baht becomes the more money I make on those things although the car account has almost run its course having been renewed several times - so no loss there. Fixed rate deposits: no loss there since all the banks survived and I've lost nothing on my SET investments because I don't sell over the short term. I know that others in this forum, notably Fletch, have seen substantial gains on the SET over the past fifteen years, returns in excess of 1,000% so no loss there either.

 

Finally finally, my cash assets were 50/50 in the Thai Baht, I upped that to 75% recently and I intend to be all in by the end of the year, just so that you understand I do have the courage of my convictions.

 

 

We do not disgree that expats should not bring funds to Thailand. My point of view is that expats should not bring Money They Cannot Afford to Lose to Thailand. 

 

I have around 10% of my total assets invested in Thailand, and like you I invested when the Bht was through the floor, unlike you I did not bring any money into Thailand to make those investments and the investment advantage at the time was not the price of the Bht, rather actually having cash to buy assets that were being sold by the banks at rock bottom prices - Profits made and shipped out. 

 

There is money to be made - expat fire sales are one of the most profitable businesses going. Guys who thought nothing could go wrong, learning at last they have to do whatever they can to get whatever they can out of Thailand. 

 

Like you, I have the courage of my convictions. 10% invested in Thailand to meet my needs in Thailand, the rest securely invested in the UK where there are no restrictions on the assets I may hold and a strong legal framework protecting my rights.

 

Currencies held in UK banks need not all be in Sterling - And London provides a wide range of investments in  Asia, the transactions in which are protected by UK law. 

 

As you say, Asia offers some great investment opportunities, but Thailand is facing huge changes the end game of which we can only guess at. 

 

The biggest risk is not currency fluctuations and yes you do seem to have courage in your convictions - I wish you the very best of luck. 

[simon43]

Just a comment about the timescales for receipt of this inheritance.

 

The reading of the will is only the initial step in receiving the inheritance.  The lawyer/executor of the will then needs to 'collect' all assets, which could include cash in various bank accounts, shares in companies, life insurance etc etc.  That process may take months.  Then they need to liaise with the relevant tax authorities re death duties etc.  Finally, you will be sent the money due to you.

 

I am in a similar position to the OP, albeit for a more modest sum.  Despite the state of my mother being relatively simple to 'process', I am almost 8 months 'down the line' after her passing and still not in receipt of funds, (due to waiting on paperwork from the various government/tax/ organisations).

 

The wheels of the inheritance process turn slowly, so it sounds as if the OP will not have cash in his hands until next year.

[Naam]

Just a comment about the timescales for receipt of this inheritance.

 

The reading of the will is only the initial step in receiving the inheritance.  The lawyer/executor of the will then needs to 'collect' all assets, which could include cash in various bank accounts, shares in companies, life insurance etc etc.  That process may take months.  Then they need to liaise with the relevant tax authorities re death duties etc.  Finally, you will be sent the money due to you.

 

I am in a similar position to the OP, albeit for a more modest sum.  Despite the state of my mother being relatively simple to 'process', I am almost 8 months 'down the line' after her passing and still not in receipt of funds, (due to waiting on paperwork from the various government/tax/ organisations).

 

The wheels of the inheritance process turn slowly, so it sounds as if the OP will not have cash in his hands until next year.

not all countries use the complicated method you described and the various difficulties you assumed Simon.