Is your investment risk at your age?
Anyone who already has a lot of securities and also a mortgage should reduce their risk as much as possible.
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One-way amortization: In old age you have to consider that the mortgage cannot be topped up again.
Illustration: Christina Baeriswyl
We are a little unsure how to proceed with our assets. To diversen Depots and Accounts came nun another heritage added. The consultationn seitens der Banken ehold too few useful Suggestions. I’m 75, my wife almost 70. In addition to these bar and depot facilities, we have a terrace apartment, value approx. 1.1 million francs, with a mortgage of 600‘000 francs. I think I want at least 100‘Pay off CHF 000 at the Hypo. I watch the stock market practically every day. Since the courses are at their highest levels, that’s my opinion after risky to make further investments; at the same time ist is snice that Farther Increases occur. What can you do? Readers question from B.P.
According to the list you sent me, the part of your assets is professionally managed through an administrative mandate at UBS. That costs you quite a bit of fees. However, the compilation of the depot basically makes sense. I see only limited need for action here. However, with all investments I do not recognize enough what goals you are pursuing with your investments. Rely on growth or income or whatevern Are you pursuing goals?
Before investing, you should have a clear idea of the purpose of the investments made. Especially in old age it often makes sense that you can use as regular yieldit is topped up from the plants. I don’t see a common thread in your various investments – not even in the part of the assets that are managed by the bank.
From my point of view, it would be worthwhile if you clarify this and then better align the investments with your specific investment goals. The problem in your depot is the high cash balance of around 300 in total‘000 francs. This is money that lies idle and does not generate any income. I see a need for action here.
By reducing the mortgage, you also protect yourself in the event of rising interest rates.
At the same time you write to me that your condominium will also be available at the age of 600‘000 francs is charged. Basically, especially in old age, you have to think twice about whether you simply amortize a mortgage, as you can no longer top it up later if you then perhaps need more liquid funds again. In your case, however, I would find it useful if you could use some of your cash that is now in your account to reduce your mortgage.
Mortgage rates are currently very low and will probably remain so for a while. Still, you pay the bank for the mortgage WITHinsen. That is money that is now flowing away from you to the bank. At the same time, you have zero income on your cash and cash equivalents. This is bad business. So I share your opinion that I would reduce the mortgage with the cash on hand. This will save you at least part of the mortgage interest.
Of course, you could also invest this money right away. However, I currently rate the situation on the financial markets as delicate. The nervousness surrounding the tilted Chinese real estate developer Evergrande continues to hang over the markets like a sword of Damocles. In addition, investors are preparing for a tightening of monetary policy in the USA and many stocks are indeed well valued. In such a constellation, there is little need for the markets to correct much more clearly. Usually it is an unexpected event, which then suddenly triggers a wave of sales.
Against this background, I would not acquire any new positions in your situation at the current high level, especially since you already have many securities in your various securities accounts. By reducing your mortgage, you also protect yourself in the event of a market correction and later, perhaps, rising interest rates.