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Canadian new to saving in Sweden, few questions

ISK and finance

rogersmack
post 21.Aug.2018, 09:51 AM
Post #1
Joined: 18.Aug.2018

Hey all,

I have a few questions about savings in Sweden. Some quick background is I'm a 30 year old Canadian, moved to Sweden a couple of years ago living in Stockholm. I have a pretty good, stable job and I am able to save probably 20k SEK per month. I've now saved up enough money for any emergencies that piling more money into my account with 0% interest starts to feel rather dumb. I'm currently a customer of Swedbank and my gf and I have our apartment loan there.

1) When looking an ISK, I'm just looking to contribute monthly (eg, set aside some money every month) and have a pretty diversified low risk portfolio. I've read some about Avanza and it seems like they are the best when it comes to fees and I can pick a few things like Avanza Zero and expect a pretty good return, am I missing anything? Any reason to use Swedbank instead?

2) When it comes to removing money from an ISK, over the next few years I plan for a couple big spends, probably some money for a few vacations and then hopefully a house in 4-5 years and maybe a car in half a year. Given that an ISK is kind of taxed upfront, should I avoid putting money in if I want to buy a car in say, 4 months and might remove some?

3) When it comes to investing vs paying down my apartment loan, my sambo and I have a shared loan for about 3mil SEK at 1.44%, it feels like savings through investing makes more sense than to try to pay down the loan early given the interest rate, this is at least very much the Canadian approach, would Swedes say different?

I think that covers it, really appreciate any comments!
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wondering_again
post 22.Aug.2018, 08:52 PM
Post #2
Joined: 12.Feb.2014

1. ISK is basically where you choose different funds and the tax rate I think is less than 0.5% if I am not wrong. All banks should have a portfolio of funds but Avanza has a very large spread of funds. You can use avanza and create a portfolio and then start to save there monthly. You can use Swedbank and see which funds are there and compare with the ones in Avanza. Often banks like Swedbank , Nordea etc etc tend to highlight their own funds over the others.

2. Most funds tend to go up during the year so if you are up 12% and pay only 0.5% then I guess you are doing alright smile.gif . Not your advisor but you can take money out of an ISK and it should appear in your account in 2-3 days depending on the fund chosen. You will find this in the fine print for each fund

3. I assume you are amortizing. It is totally your call if you want to amortize more or instead save money as extra
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yet another brit
post 24.Aug.2018, 01:01 PM
Post #3
Joined: 5.Jan.2013

QUOTE (rogersmack @ 21.Aug.2018, 09:51 AM) *
3) When it comes to investing vs paying down my apartment loan, my sambo and I have a shared loan for about 3mil SEK at 1.44%, it feels like savings through investing makes mo ... (show full quote)


As far as I can see, people tend to pay down the loan to the extent that the banks require (which for youngsters with a large mortgage, could be a significant burden), and do something more useful with what is left over.

That being said, until recently, a reasonable strategy [in Stockholm] was to buy as large a property as possible with as little amortisation as possible (saving your money for the interest payments), and just sit back and watch the money that you are borrowing at 2% increase at 10% via property values...
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rogersmack
post 25.Aug.2018, 11:44 AM
Post #4
Joined: 18.Aug.2018

Thanks for the comments!

In terms of my mortage, correct. Right now we are paying down the required amount on a monthly basis, but could in theory pay it down faster, but with a 1.45% interest rate it certainly seems like its better to keep the loan and then invest, of course its a bit scary with the Stockholm market, but we have enough equity in the market, and plan to live here long enough that even with some sort of crash (and the Stockholm housing market seems to have stabilized) we'll manage.
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john.boy
post 25.Aug.2018, 10:25 PM
Post #5
Location: Stockholm county
Joined: 27.Sep.2017

It should be pointed out that the Social Democrats announced the other day that they intend to raid peoples ISKs (again) if they win the election.

People vote with their wallets, socialists vote with other peoples wallets angry.gif
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