While every parent’s dream is to send their child to university, it is often more expensive than the average working class family can afford. If you take into account that the average salary as of 2018 in the UK is £27,271 and that the cost of undergraduate programs at university can reach £9,250 per year, it is understandable that most working class parents are seeking ways to grow any savings they can accrue. This typically means investing small amounts over a long period of time and for the most part, this is a good plan. However, what kind of investments are safe and are you willing to invest in a fund overseen by someone else, no matter how knowledgeable that person might be? Here is an unusual option to consider.
Fine Wines as an Investment Product?
Before going into some of the most common investment products, let’s take a quick look at one which you may not have considered. That would be fine wines. With France just across the channel and French wines relatively inexpensive as they are produced each year, it makes sense to look at some wines that age well and can fetch a high price after just six to ten years. Bordeaux and Grand Cru Burgundy happen to be the most sought after investment wines and so perhaps that’s where you’d like to start. These two wines are best enjoyed when aged and would be the perfect place to begin placing your wine investment capital. As a side note here, any connoisseur knows that you must wait at least ten years after the vintage of Grand Cru before opening the bottle – and ten years is the minimum wait!
A Quick Look at the Wine Investment Strategy
Wine connoisseurs think nothing of dropping over £450 for a good bottle of Burgundy or Bordeaux and that is what you are aiming to offer. Amazingly, that is just a starting price for a fine collector wine and some bottles fetch prices many times that amount. The key is to get wine by the case the year it is bottled. You will want to avoid, if possible, wines which have been aged somewhat by the vintner because the longer they age, the more they cost. That, after all, is what you are trying to accomplish by investing in fine wines.
The Cost of Aging Wines
It is important to understand that you cannot just take a few bottles of wine and store them in your cellar, even though the temperature may ‘feel’ right. Unless you have a storage cellar that has state-of-the-art climate control, no basement will give you the results you need to fetch a high price at the end of the aging process. Remember, you are going to be housing that wine for a minimum of 6 to 10 years and temperature fluctuations can literally ruin the process. It is best to invest in wine cellars like those offered by companies such as Octavian Vaults and purchase insurance to protect your investment.
For a few hundred pounds a year you can store wine in optimal conditions so that when you list it at auction, and this you will surely want to do, you will be assured that your investment wine is perfectly aged to the connoisseur’s palate. It may seem like an unlikely investment vehicle but if you can buy freshly bottled wines from world renowned vintners at a reasonable price, you can amass a small fortune by the time your child is of age to go off to university. In fact, you might even have enough left over to buy yourselves a retirement home as well. Wouldn’t that be nice?
The nest is empty, the kids are off to university so keep one bottle back for that “finally at last” toast with no one to spoil this moment you’ve waited a chaotic lifetime for!
