How best to invest your nest egg? Update with Jean-François Aguado, ATS Finance broker in Castries.
With inflation, skyrocketing mortgage rates and uncertainty in the markets, it’s hard to know where to put your little nest egg. “It obviously depends on each situation, but for management as a good father, the regulated booklets become very interesting again”, directs the broker Jean-François Aguado, of the Castriot company ATSFinance.
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Should you place your money on a Livret A and a popular savings account whose rate is increasing?
1- Regulated booklets
Calculated by the Banque de France according to inflation, the rates of the Livret A and the sustainable and solidarity development booklet (LDDS), already reassessed several times in 2022, will reach 3% on February 1. And even 6.1% for the Popular Savings Book, but this is reserved for the most modest incomes (read below).
“This means, on the 3% passbooks, that a deposit of €5,000 in January can earn almost €150 in interest at the end of the year. Or even more because the rates can still increase”continues Jean-François Aguado.
“The Block Booklets”, he therefore advises with a smile, recalling that they are free of charge “but subject to inheritance tax” and that they are however capped at €22,950 for the Livret A and €12,000 for the LDDS. Which still represents an interesting gain of just over €1,000.
Beyond, “Banks generally offer additional booklets, for which they decide the rates themselves. It is a loss leader, so they can offer ‘promotions’ for a certain period”. The opportunity to play the competition? “Sure”, answers the ATSFinance expert.
If there is one element to remember, it is above all that in this context, rather than letting your cash lie dormant in your current account, it is preferable to pay it into a savings account or an LDDS, “especially since the sums invested remain available at all times”.
2- Life insurance and funds in euros
Jean-François Aguado has many other products up his sleeve. And in particular life insurance invested in funds in euros “which remains an investment with limited and often profitable risks (more than 2% on average in 2022, editor’s note). The interest is in particular that the interests acquired are secure”. Generally, it is now proposed to invest 40% in funds in euros and the remaining 60% in units of account, which allows you to diversify and even choose the nature of your investment. “But it is better to choose companies that have a storefront”.
3- And why not SCPIs?
With an average return of 4.45% in 2022, the Société civile de placement immobilier offers an attractive potential return. Quesaco? This is also called the “paper stone”, a long-term indirect rental property investment, without any rental management, with an entry ticket accessible from a hundred euros.
The income paid to the partners of the company (which can have around a hundred properties) corresponds to the rents collected in proportion to the shares invested. There are more and more SCPIs on the market, “but it is better to be well accompanied” to choose well as there are some with very different characteristics, some less efficient, others more risky. Mostly, “if we leave before the end, there can be big penalties”.
4- And the stock market or cryptocurrencies?
Jean-François Aguado does not go there by four paths: “In this field, we only invest what we can lose”. It’s almost casino, especially on cryptocurrencies, “most of which have lost between 70 and 80% in one year”.
Certainly, he adds, bitcoin is recovering and others are going up, “but it’s so volatile and there are a lot of scams”.As for the stock market, “it is always possible to open a securities account on the internet and manage your portfolio yourself”. But there again, you should not invest all your savings there, “it’s too risky”.
5- Real estate, still a safe haven?
It’s necessarily more complex at the moment with mortgage rates that are constantly climbing “But yes, for the French, it remains a safe haven, and it is still interesting in our region”, assures Jean-François Aguado, who assures that the Pinel device, which makes it possible to tax-exempt its investment, can in particular prove to be still interesting.
“With a resale after 10 years, we can still count on a profitability of 8 to 9%. There is nothing more efficient”, he calculates. Provided however, again, to choose the right product.
