This year was an eventful one in the personal finance market. More Irish people than ever before became shareholders following the Eircom flotation. The euro came into existence and interest rates fell to historic lows while the arrival of new competition in the Irish market signalled the shape of things to come.

Most of the developments were positive for consumers, many of whom are paying more and more attention to their financial planning in an increasingly complex market. Falling interest rates and rising disposable incomes have also led to a greater focus on how to get the best value for money.

In the search for the best return on their savings in a low interest-rate environment, a growing number of people turned to equities, traditionally the best performing asset class over the long term.

Direct share ownership rose dramatically as more than half a million people availed of the opportunity to buy shares in Telecom Eireann while the Canada Life flotation added a further 50,000 shareholders to that list.

A report from Goodbody Stockbrokers in June, prior to Eircom's July flotation, estimated that 13 per cent of the Republic's adult population or some 380,000 people held shares, up from 4 per cent in 1997. This figure seems certain to rise in the year ahead, even if the planned Aer Lingus flotation does not draw in as many ordinary retail investors as Eircom.

High-tech shares remained popular with certain types of investors, including those working in the sector. And legislation introduced in the Finance Bill to promote profit-sharing through save-as-you-earn schemes should ensure that the numbers of workers with shares in their own firms, particularly in this sector, will continue to rise.

But there was also a discernible trend by investors to spread their risk by moving into investment funds such as unit-linked products rather than focusing on just a handful of shares.

Some £830 million (€1.05 billion) was put into lump-sum investment funds in the first six months of 1999 alone, a 73 per cent increase on the same period a year earlier, according to the Irish Association of Investment Managers (IAIM).

In response to demand, there was an explosion in the number of new funds on offer. Euro funds, which allowed investors the opportunity to invest in stocks across the euro zone proved particularly popular as did funds with capital protection built in - such as with-profit products and property funds.

Providers also put more effort into making such investment products easier to understand and more accessible to the ordinary investor.

Despite the poor performance of the Irish equity market in 1999 - seen by many in the financial services industry as a buying opportunity - investment in equities looks set to remain popular next year.

"The outlook for deposits and deposit-type products, such as tracker bonds, remains bleak," says Mr Martin Kane of BCP Stockbrokers. "However, the current environment is ideal for investment funds based on property and/or stock markets."

If shares were in, cash was certainly not king as the Republic joined the euro and demand deposit rates sank as low as 0.2 per cent in some cases. But the arrival of Northern Rock in the market provided some respite for hard-pressed savers and the recent rise in interest rates showed there may be some light at the end of the tunnel.

But if depositors were having a hard time, borrowers, particularly mortgage holders, found themselves on the pig's back.

Interest rates fell significantly following the euro's introduction in January but the entry of Bank of Scotland to the marketplace in the summer put even further downward pressure on home loan rates, forcing variable rates below 4 per cent.

However, most commentators now agree that the interest rate cycle has turned and rates are set to rise in the years ahead. But they do not expect a return to the 10 per cent levels Irish borrowers were accustomed to in the past and see only modest rises of a quarter to a half a percentage point next year.

"We would expect rates to be unchanged in the first half of next year with the possibility of a small rise in the second half," says Mr Dermot O'Brien, chief economist at NCB Stockbrokers. "We don't think that the euro zone economies are recovering that fast to cause worries about inflation."

Accordingly, Mr O'Brien expects official euro zone interest rates to end 2000 at between 3.25 and 3.5 per cent, compared with 3 per cent at present. Along with the intense competitive pressure in the Irish market, this should ensure that mortgage rates remain relatively low.

Change was not just confined to the savings and investment and mortgage markets this year but extended to other aspects of personal finance. The 1999 Finance Act shook up a small corner of the pensions industry with the promise of more to follow.

The Minister for Finance's decision to abolish the compulsory purchase of annuities for the self-employed and owner directors gave these groups the freedom to decide the fate of their pension fund on retirement. And Mr McCreevy hinted that the measure could eventually be extended to all classes of pensioner.

Industry experts will be keeping a close eye on next year's Finance Bill in the wake of Mr McCreevy's budget day promise to address other anomalies in the pensions area in the next Bill.

Also due next year is legislation setting up personal retirement savings accounts (PRSAs) which can be owned by the individual, regardless of their employment status.

As a result, it should make personal pensions accessible to the lower paid, to part-time workers, people on career breaks, workers with few years service, as well as to workers whose employer does not provide any occupational pension.

The other big legislative change expected in the personal finance area is the long-awaited introduction of commission disclosure on the sale of life assurance products. This will allow consumers to find out how much of their premiums go towards their investment fund, and how much ends up in the insurance agent's or broker's pocket.

Finally, the consumer can look forward to further competition among product providers in 2000. The arrival of new players like Bank of Scotland, Northern Rock and Tusa - the joint venture between TSB and Superquinn - in the market is widely believed to be just the start of a major shake-up in the financial services market.

According to a recent report from management consultant Prospectus, the most immediate threat is expected to come from other British providers targeting the Irish market in a bid to increase the volume of their low margin products through lowcost channels.

But the arrival of a large European player or the launch of an Internet banking service would also seriously shake up the Irish market.

"The common thread between all new competition is that they are developing new business models to compete in Ireland. Most incorporate a clear cost advantage through selective distribution," the Prospectus report says.

All of which is good news for the consumer who will enjoy more choice but also face an increasingly complex market.