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JOEL GOODMAN FAME & FORTUNE PETER CASEY TALKS TO LARISSA NOLAN I HAVE GONE THROUGH PERIODS WHERE I Spending HAVE MADE MONEY AND I HAVE GONE THROUGH PERIODS my way to WHERE I HAVE LOST IT prosperity

Where did you buy your first house and how much did it cost? It was a nice little bungalow in Sydney The Dragon bounced back from going bust that I bought for A$275,000 (€188,000) in 1983. I paid half in cash and borrowed and says austerity just doesn’t work for him the rest. I lost that house when the banks took all my money.

HAVING been an investor on RTE’s Spender or saver? What is the best value in Ireland? Dragons’ Den, Peter Casey is turning his Definitely a spender. I never saved in my There are some real bargains in property hand to politics. The 58-year-old hopes life. My wife Helen is a good spender too. in rural Ireland. is saturated, and to become a senator on the upper house’s The funny thing is, I hate shopping. I eventually the government will realise industrial and commercial panel, having bought a car last week and the whole that. We need to decentralise. decided against running in Donegal in transaction was done in 15 minutes. I On the upside there is a great the recent general election. haggled for a bit, wrote a cheque and opportunity to buy houses outside of Born in , his first business walked out. Dublin. You could buy a home on the venture was selling plastic bullets as I’m not a big believer in austerity. I water in Donegal for €50,000 but there souvenirs to tourists. One of nine don’t think you can save your way to wouldn’t be jobs or public transport. children, he witnessed the events of prosperity. It hasn’t worked in Japan for There are plenty of wise buys, however. Bloody Sunday in 1972. the past 25 years, and it won’t work here. He left Derry at 17 to study economics Can money buy happiness? and philosophy in Birmingham. After What was your first job and how much were I have gone through periods where I have university, he joined Xerox and credits you paid? made money and I have gone through the American document services I worked in Kevin McLoughlin’s garage periods where I have lost it. Anyone who company for developing his work ethic. on the Buncrana Road in Derry as a petrol knows me will tell you I am a much After rising through the ranks in Europe, pump attendant on Saturdays when I was happier person when I have money. he moved with Xerox to Australia. about 13. I got £4 (€5.20) a week. One I don’t think it can buy happiness but He earned his first million at 27, week in the school holidays I did 42 hours earning money can make you happy. I having founded his own search and IT overtime. I got time-and-a-half for it. have friends who are very rich and very contracting business in Sydney in 1985. unhappy — they inherited their money. He invested heavily in the property Pension or property? If you earn it, that’s different. market but lost all his money in an I have never had a pension plan and, up economic downturn. to 10 years ago, I didn’t have an insurance Biggest rip-off in Ireland? He returned to Ireland in 1993 but policy. I didn’t even have a will. We’re being ripped off at the petrol two years later relocated to America, I’m sure my wife would have got it pumps. Oil has gone from $145 a barrel to where he set up Claddagh Resources, a all [if I died]. I made a will, though, $30 a barrel. Yet in Ireland it has hardly global recruitment and search business when a friend who is an accountant gone down at all. They are getting it so based in Atlanta. questioned why I didn’t have a will much cheaper but they are not passing it The company operates on four when I have five children. to the consumer. That’s to do with continents and in six countries, including I bought a large farm in Derry about 20 government charges. There’s a slight Ireland, and opened a European head years ago, which exhausted my funds, so drop in the cost, but not as much as there office in Donegal in 2000. I didn’t get a chance to get into property Casey has never had a pension and drew up a will only after an accountant friend said it was a good idea for a man with five children should be. In recent years, he has become a in Ireland, and avoided the bust. familiar figure on RTE’s Dragons’ Den. What would you do for €1m? He is married to Helen, from Crumlin Do you have stocks and shares? shares because I knew what I was My father also used to say there’s no have no idea how my parents managed. Nothing. I have my goals and values in Dublin. They have five children: I bought 1m shares in , getting into. So many people have lost a right way to do the wrong thing. That’s We had no car, no washing machine, and established and in place. My family is Fionnbarr, Ryan, Neala, Ailisha and which I still have — I like Bank of Ireland. lot of money investing in things they another good piece of advice in business. an outdoor toilet. No 1. I wouldn’t change anything or do Siofra. The family live in Atlanta, with I have five Berkshire Hathaway shares, have no idea about, such as Lehman But I never felt poor. I never felt I anything for €1m. I have a lovely life and other homes in Derry and Donegal. Warren Buffett’s company. I bought them Brothers. People were buying bonds How could the government help needed anything. I was the eldest boy, so a lovely wife. Casey is also a writer and political and quite some time ago, they were about and they had no idea they were toxic. people financially? I got all the new clothes before they were business commentator. His 2014 book €100,000 each. I don’t look at the Don’t go near anything you don’t Small businesses are the lifeblood of any handed down a few times. Any advice for budding entrepreneurs? Tata: The World’s Greatest Company, lifts share price [Berkshire Hathaway understand. country. We should do more to encourage We all felt we were our parents’ Be prepared to work 100 hours a week the lid on one of India’s biggest currently trades at about $209,000 people to jump off the entrepreneurial favourite. They raised a very successful and keep some gas in the tank to ensure conglomerates. It is in its second reprint (€190,000) a share]. What’s the best financial advice you cliff. The government could allow bona family. I’m the least qualified, with my you can stop before you run out. Draw a in India, where he has conducted signing have received? fide entrepreneurs to live tax-free for two economics degree. line in the sand and define when to call it and speaking tours. Any investment tips? Cash is king. My father, Leo, used to say years to build up their businesses. My siblings are dentists, doctors, quits. Don’t keep going if it’s not working Peter was named by Irish America Don’t invest in anything you don’t this, and he was right. The reason good solicitors, teachers. There is no doubt — know when to pull out. And ideally, magazine as one of the leading Irish understand. Never follow people into businesses go broke is because they Are you better off than your parents? that my parents are the ones behind have a partner who is totally onside and American businessmen for 2007. investments. I bought Bank of Ireland mismanage cash flow. Oh Lord, yes. I was one of nine children. I our success. supportive. Manage your money or you’ll feel old before your time

Sticking to some simple guidelines can reap rich rewards and improve your prospects of achieving a comfortable lifestyle in retirement

s a financial government bonus of €40, OVERCOMPLICATED AND adviser, my job is which equates to an instant OUTDATED STRATEGIES to help clients top-up of 67%. If this is not There are only the same five manage their enough to entice you in, main asset classes to choose money, which consider the underrated from — cash, bonds, equities, Aoften means advantage that your entire property and alternatives — undoing some of the mistakes retirement fund grows regardless of whether you are made in the past. Here are tax-free. saving for retirement or other some of the most common purposes. mistakes I encounter. IGNORING LIFE INSURANCE One or at most two TAX BREAKS broadly-diversified unit- NOT JOINING AN EMPLOYER’S Life insurance is a financial linked multi-asset funds is PENSION SCHEME necessity if you have loans, normally all that is required. A typical defined contribution EOIN children or other dependants. As you would expect, lower- scheme requires employees to You may be eligible for tax risk funds will have a higher contribute 5% of salary, with BUCKLEY relief of up to 40% on the allocation to cash and short- a matching 5% employer premiums if you are dated bonds; higher-risk contribution. By not joining, self-employed or an employee funds will have a higher you are refusing your who is not a member of an weighting towards equities employer’s contribution occupational pension scheme. and property. which is akin to turning down the offer of a 5% pay rise. UNDERESTIMATING INFLATION TRANSFERRING A PENSION PANICKING OVER SHORT-TERM Pension schemes differ Compounding also works FUND FROM JOB TO JOB MARKET FLUCTUATIONS between employers, so you do against you, as evidenced by Rather than transferring a Investment risk decreases in need to review your own the corrosive power of pension to a new employer’s proportion to the length of the specific situation. inflation. Cash yielding close scheme, job hoppers with Showing too investment period. Over time, to zero on deposit will become large funds would be advised much caution we can be certain that the NO PENSION TARGET an obvious victim of inflation to leave their funds with their in your investment markets will The most you can have in your over time. An annual inflation previous employer or to financial encounter and move through pension fund is €2m, which is rate of 3% for 10 years would transfer it to a personally affairs while many crises. There will out of most people’s reach. I cause cash to lose 25% of its owned buyout bond. young could always be short and even challenge clients to target a value in real terms. This can be a more catch up with medium-term market fund of at least €400,000. favourable option on death you in later declines. However, they Somebody who starts pension TOO MUCH CAUTION because the full value of the years should not dissuade us from saving at 45 would need to WHILE YOUNG buyout bond would be paid our long-term investment contribute about €1,000 a All of us would recognise the out tax-free to a surviving journey. month to reach the target danger of having too much spouse. death before retirement, the times final salary. However, but fail to structure it tax given many investors a harsh fund at 65. Starting your exposure to high-risk equities Should you transfer a large full value of a PRSA would be they must purchase an efficiently. and costly lesson on the SAVING WHILE IN DEBT pension journey without a and property for those pension fund to your new paid tax-free into the estate of annuity with the balance of dangers of specific risk. Would you like a risk-free target in mind is a bit like approaching retirement. employer’s scheme, you the deceased. the fund. There are three CHASING RETURN BUT Diversification is the most return of 18% or 0.59%? A trying to use the sat nav in However, I often meet clients would find your wings clipped definitions of what comprises IGNORING RISK important overall objective. It typical credit card interest your car without inputting who, with decades to go until in terms of access. This would NOT CONSIDERING ALL “final salary”, so good advice Investment is about risk and involves diversification across rate is 18%, while the bank the destination. retirement, invest their not be allowed until at least OPTIONS AT RETIREMENT is likely to increase your return. A single-minded focus all asset classes — cash, bonds, that issued the card would pay pension funds in cash. They age 60 and there would be a One of the benefits of a tax-free wealth. on return is insufficient equities, property and only 1% for money on deposit, IGNORING THE MIRACLE OF are guaranteed to lose money limit on the amount that could defined contribution because investment is not alternatives — followed by or 0.59% after deposit interest COMPOUND INTEREST over time because their be paid out tax-free if you die occupational pension is that NEGLECTING ESTATE PLANNING about getting the best possible diversification within asset retention tax. The wise Small differences in annual pensions will not keep pace before retirement. you get a choice of two By utilising a trust form or a return. Rather it is about the class — spreading equities by approach would be to use performance can add up to big with inflation. options at retirement. deed of assignment, couples optimisation of returns: geographical and industry accumulated savings to repay differences over time. FAILING TO UPDATE Most members take a tax- can give of up to €6,000 a getting the best return for an sectors. the extremely expensive Suppose you invest €100,000. OVERLOOKING PENSION YOUR PLAN free lump sum of 25% of the year to each of their children acceptable or appropriate For those seeking returns short-term debt. If it makes 5% a year, you TAX BREAKS Should serious illness strike, value of their funds. Those or grandchildren without level of risk. in excess of inflation over the Eoin Buckley is a certified would have growth of The offer of 40% tax relief is those with large pension funds with more than 20 years’ affecting the children’s medium to long term, a financial planner and director €165,329 after 20 years. If it there for the taking for top- should consider switching service and relatively small liability for gift or inheritance NARROW INVESTMENT FOCUS broadly diversified unit- of ABM Financial Advisers in made 6% a year, you would rate taxpayers making from an occupational scheme funds, however, may be better tax. Most clients appreciate In the recent past, an linked multi-asset fund is an Cork. [email protected]. ABM have €220,713 — an additional pension contributions. A €60 to a personal retirement off choosing the second the need to save for children’s overexposure to Irish effective way to gain exposure Financial Advisers is regulated €55,000. contribution receives a savings account (PRSA). On option: a lump sum of 1.5 education and other needs property and bank shares has to all five asset classes. by the Central Bank of Ireland