Investing in whiskey instead of paying a pension.

dashcamdanny

Not a new idea by any means, but one that has crossed my mind a few times.

I pay into a pension right now, but the wife does not. She has the option of joining a company pension. At 40 years old.

Probably going to cost about 150 per month.


Now. Instead of spending 150 a month, give or take a few pound, what if I bought a bottle of limited edition Irish whiskey like a bottle of Middleton or redbreast. . Say 12 bottles per year.

In 35 or 40 year when we retire, a decent size collection will have been acquired.

Im betting you would see substantial gain and at the very worst, break even. Maybe better than a pension?

Has anyone else here done the same?

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MrFinance

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Was literally going to say the same thing.

odyssey06

You missed the boat on this...
https://www.businesspost.ie/focus-on/nephin-whiskey-raises-spirits-eiis-investment-370767

Make sure to keep receipts and photos of your collection in case you ever have to make an insurance claim...

MrFinance

odyssey06 wrote: »

You missed the boat on this...
https://www.businesspost.ie/focus-on/nephin-whiskey-raises-spirits-eiis-investment-370767

Make sure to keep receipts and photos of your collection in case you ever have to make an insurance claim...

"Please subscribe to continue reading"...Slim chance.

odyssey06

MrFinance wrote: »

"Please subscribe to continue reading"...Slim chance.

MrFinance doesn't have a subscription to the Business Post! for shame...

Try this one...
http://council.ie/toasting-tradition-mayos-new-whiskey-distillery/

It was a scheme to invest in a new Irish whiskey distillery and get tax relief under something called "EIIS".

dashcamdanny

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Before even try and do the sums, do you still think it would be more profitable?

beardybrewer

OR... just hear me out here, rather than pay into a pension just drink the whiskey to shorten your life so you don't need a pension!

mik_da_man

I assume any investment like that (buying bottles) would be subject to tax instead of getting relief on it.
Going on history, the likes of Midleton will go up in value, likely far more than double in that time frame.
Other bottles, unless very rare don't seem to jump as much.

You'd need a safe place to store them, insure them and not drink them

Personally I wouldn't replace a pension with a collection of bottles, but a few choice purchases now may net you a nice profit in years to come. But due to the risks involved, and possible tax implications I wouldn't rely on it.

Shur, they way things are going in 30 or 40 years alcohol may be banned .....

Metric Tensor

mik_da_man wrote: »

Shur, they way things are going in 30 or 40 years alcohol may be banned .....

That's what he should hope for. They'll be worth a fortune then!

dashcamdanny

I would have thought you could sell them for cash to be honest

mik_da_man

dashcamdanny wrote: »

I would have thought you could sell them for cash to be honest

You could, but will cash be around in 30/40 years?
it may just be BitCoin and regulated

But honestly, it ould be impossible to hide the influx of money, whatever type it is.. And the tax man comes knocking.

alias no.9

Whiskey is matured before it's bottled, once it's bottled, that's it best case it doesn't change and stays drinkable. It's not like wine which continues to age and n the bottle.

the beer revolu

alias no.9 wrote: »

Whiskey is matured before it's bottled, once it's bottled, that's it best case it doesn't change and stays drinkable. It's not like wine which continues to age and n the bottle.

You don't say!

adrian522

I quite like the idea of being literally able to drink your pension

CardinalJ

I do this with my wife but we both have real pensions also. We buy 2 or 3 decent bottles a year and have em sitting.... waiting.

We do it more as a bit of fun, but youre losing out on tax breaks and employer contribution if she only does this.

alias no.9

the beer revolu wrote: »

You don't say!

Be as snarky as you like, the producer can simply ramp up production, most are right now to take advantage of a growth in demand. There's nothing about your bottle that marks it out as better than any other. It's not a good investment, particularly for a pension.

With wine, you simply cannot make any more of a specific vintage, if you get a good one you'll do well with a declining supply over time.

L1011

Whiskey and high quality wines/fortified wines are very common parts of diversified investment portfolios.

Alone it is not a suitable replacement for a pension.

Unlike some other regulars investment items, tastes are unlikely to change so much as to destroy value - lots of old jewelry has fallen to scrap metal value from having had significant value as an antique; certain types of antique furniture have become near worthless etc. And its not like callcards, where a cessation of production actually destroyed the collectability value - when a distillery closes the product usually goes up.

dashcamdanny

Yep. So a few good bottles a year with my pocket money maybe the way forward.

PCeeeee

Where does a lad sell a 'desirable' bottle then?

dashcamdanny

PCeeeee wrote: »

Where does a lad sell a 'desirable' bottle then?

Lots of Facebook groups buying, selling and swapping.

Cona

Stupid question, but how would one know which whiskey would appreciate and which wouldn't?

dashcamdanny

Cona wrote: »

Stupid question, but how would one know which whiskey would appreciate and which wouldn't?

From my research so far, it has to be very sought after and have a limited supply. For instance, Redbrest recently had a very limited cask which they bottled and sold with a nice box and a couple of glasses. 500 euro . A month later they are selling for 1500 second hand

the beer revolu

alias no.9 wrote: »

With wine, you simply cannot make any more of a specific vintage, if you get a good one you'll do well with a declining supply over time.

Yes, but not all wine is suitable for ageing - you need to know what you are at. Also wine does not improve in taste or value indefinitely - again, you need to know what you are at to sell at its peak.
Most people won't touch an expensive wine with a barge pole unless they know exactly how it has been stored.

Wine as an investment is really for the experts.

As you so kindly pointed out, whisky won't change in the bottle and doesn't need special conditions for storage and won't go off.

While whisky may not be an ideal pension, I'd recommend it over wine any day for a novice.

mik_da_man

alias no.9 wrote: »

Whiskey is matured before it's bottled, once it's bottled, that's it best case it doesn't change and stays drinkable. It's not like wine which continues to age and n the bottle.

alias no.9 wrote: »

Be as snarky as you like, the producer can simply ramp up production, most are right now to take advantage of a growth in demand. There's nothing about your bottle that marks it out as better than any other. It's not a good investment, particularly for a pension.

With wine, you simply cannot make any more of a specific vintage, if you get a good one you'll do well with a declining supply over time.

Just a few things to point out on the above.

1. Whiskey can actually change if exposed to extremes (light/Heat etc)
2. The value in whiskey is not how much better it gets, it's about it's rarity.
3. If I buy a bottle of limited release whiskey now, it's value (generally) goes up with time.

It's sort of like wine in a few regards, a limited whiskey will get rarer as time goes on.

eg if you bought a bottle of Midleton each year since it was released in 1986, it would have cost you under 5k, that's worth approaching 50K now....

irish_goat

Can you put the whiskey on your house insurance? Would be a nightmare if there was a fire, flood etc.

If you're deciding to forgo a pension as well you'd be best weighing up what other investments there are out there vs whiskey.

dashcamdanny

Right. So I got the ball rolling with a bottle of Method and Madness Virgin Hungarian Oak,
and a bottle of Tipperary The Rising 11 year old.

Both quite limited and potentially expensive in the future.

Budget gone for this month.

Looking at the both and drinking my normal Black Bush does leave me with the urge to open one. Must resist

mik_da_man

Not a bad start, the Tipperary is tough to find at the moment, but I would also concentrate on new distillery releases.
eg Dingle, Pearse Lyons

imo they will appreciate more.

dashcamdanny

mik_da_man wrote: »

Not a bad start, the Tipperary is tough to find at the moment, but I would also concentrate on new distillery releases.
eg Dingle, Pearse Lyons

imo they will appreciate more.

I was looking at this, looks very interesting. Quite expensive for a 5 year old I thought.
Pearse Lyons Distillery 5 Year Old Single Malt

listermint

Let's say for instance you bought 3 bottles of that redbreast as an example for 500 and sold for 1500 that's 3 k increase. Per year. Is 3k a year enough to live on cash? No. So what sort of returns are you expecting

dashcamdanny

listermint wrote: »

Let's say for instance you bought 3 bottles of that redbreast as an example for 500 and sold for 1500 that's 3 k increase. Per year. Is 3k a year enough to live on cash? No. So what sort of returns are you expecting

I don't disagree with the fact a pension would be the safe bet.
But. Just for the sake of dreams and argument. Say you played your cards right. Invested 150 pension money per month. 1800 per year. Times three ( if you knew what you were doing mixed with luck and good timing). 5300euro.

Now multiple by 35 years left of working life.
189000

Even with tax breaks and employer contribution,. Is the pension company going to pay out that?