Three alternative ways to save

Tax-efficient saving is a way of putting money aside for later while giving yourself the potential to claim tax relief on what you save (in effect, a sort of financial boost from the government). Without doubt, the most popular way to go about this is through pension saving. However, for those who already pay into such a scheme, long-term saving may be a good way to supplement their efforts.

Benefits:

• You put money aside for later as a way to supplement your state retirement pension.
• Potential to claim tax relief for both pension saving and long-term saving schemes (i.e. they can be combined).

Drawbacks:

• Tax-efficient saving entails certain charges and taxes.
• You’re saving for the long term and therefore need to be able to do without your money for a longer period of time.

Investing an amount of your choice in funds every month is easy when you have an investment plan. Not only that, specialised fund managers take care of the complicated work, since they manage the investments for you.

Benefits:

• You can start from as little as 25 euros per month.
• You don't have to be an investment expert.
• You can adjust the size of your investments and pause, stop and restart your plan.
  
• You spread your investments over time, thus reducing your risk.

Drawbacks:

• Investing entails certain charges and risks.
• Investing is best done over the long term, i.e. when you can do without your money for a while. You can stop your investment plan whenever you want, but the more time you give it, the more chance there is that the good months on the stock market will cancel out the poor ones.

A time deposit account is a way to invest money for a certain length of time at a fixed interest rate. It’s comparable to a savings account but your money is left untouched for a longer period of time (ranging from one year to several years) and is only released when the account reaches maturity. You choose your preferred term from the range of products offered.

Benefits:

• Interest rates are usually higher than on a standard savings account.
• Your money remains safe over the entire term.
• There are no entry and exit charges if you wait until the account matures before accessing your money.
  

Drawbacks:

• Your money is not immediately available and can only be accessed when the account reaches maturity. 
• You can only start investing with a certain minimum amount (ranging from a few hundred euros to 10 000 euros).