How / Where to Invest £100k?
Discussion
From being broke(ish) a couple of years ago, we are now sitting on over £100k in the bank. All income from employment, and it’s gradually incrementing upwards at pushing £1k a month.
Shouldn’t need it for retirement (three decent pensions between the two of us and a paid-off house, and I might not want to retire anyway on the dot). I can envisage some helping our son with university, etc, but that’s five years away at least.
So what do we do with it? Already planning a significant holiday next summer, and maybe upgrading my car by about £10k in 2025.
Property would be an obvious bet, but put off by the horror stories about tenancies from my wife’s friends. Any other low-risk suggestions?
Shouldn’t need it for retirement (three decent pensions between the two of us and a paid-off house, and I might not want to retire anyway on the dot). I can envisage some helping our son with university, etc, but that’s five years away at least.
So what do we do with it? Already planning a significant holiday next summer, and maybe upgrading my car by about £10k in 2025.
Property would be an obvious bet, but put off by the horror stories about tenancies from my wife’s friends. Any other low-risk suggestions?
I came into a lump sum this year, so I've maxxed out our ISA's for this year and as the previous poster said, I've split it between topping up a second pension and upped my Rathbone Global fund which is sheltered in my S&S ISA which I'm now up 20% on.
Basically all of our ISA interest gets compounded, and my second pension is a stakeholder one via my employer where they contribute 4% on top (but there is a ceiling).
Saying that, I've just been informed by YBS that they're cutting the rate soon
I am no financial expert but some of the adice from the guys here has saved and made me a few extra £££
Basically all of our ISA interest gets compounded, and my second pension is a stakeholder one via my employer where they contribute 4% on top (but there is a ceiling).
Saying that, I've just been informed by YBS that they're cutting the rate soon
I am no financial expert but some of the adice from the guys here has saved and made me a few extra £££
If you haven’t max’d out premium bonds, I would do that.
Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
Pension, ISA, Premium Bonds, you can get that put away within a year or two into tax wrappers.
Investment wise decide your appetite for risk and invest in something suitable.
If you've filled wrappers consider low yield individual gilts.
Could me a multi-asset fund could be a tracker and bond fund could be a cash ISA could be gilts.
Loads of options.
Investment wise decide your appetite for risk and invest in something suitable.
If you've filled wrappers consider low yield individual gilts.
Could me a multi-asset fund could be a tracker and bond fund could be a cash ISA could be gilts.
Loads of options.
mikeiow said:
If you haven’t max’d out premium bonds, I would do that.
Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
T212 offers 5.17%, but without the delusion that you will win big in some nonsense lottery. Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
Respectfully I wonder how much return you've lost and will lose waiting for the next market meltdown? 
Personal view is I wouldn't consider property partly because £100K isn't going to get much plus if you fancy a holiday you can't just sell a bathroom or whatever.
Plenty of ways to lock in a sensible yield and plenty of non-toppy opportunities out there.
Personal view is I wouldn't consider property partly because £100K isn't going to get much plus if you fancy a holiday you can't just sell a bathroom or whatever.
Plenty of ways to lock in a sensible yield and plenty of non-toppy opportunities out there.
b
hstewie said:
hstewie said: Respectfully I wonder how much return you've lost and will lose waiting for the next market meltdown?
Personal view is I wouldn't consider property partly because £100K isn't going to get much plus if you fancy a holiday you can't just sell a bathroom or whatever.
Plenty of ways to lock in a sensible yield and plenty of non-toppy opportunities out there.
Cash is still returning 5.17% risk free, and potentially tax free, which is pretty good considering inflation.Personal view is I wouldn't consider property partly because £100K isn't going to get much plus if you fancy a holiday you can't just sell a bathroom or whatever.
Plenty of ways to lock in a sensible yield and plenty of non-toppy opportunities out there.
BTL is a fools game, unless you're retired. Global quity trackers are 10+ year investments. Gold is at all time highs. Crypto is pure speculation. What's left for a medium time horizon?
If your timescale is medium term fair enough 
"I'm holding cash in an investable account (T212), ready for the next market meltdown." kind of suggested you were holding cash waiting to deploy it into a 10+ year investment.
I'm just gently suggesting I don't think you or I know when the next market meltdown will be and looking at the predictions of all the major investment companies of where the S&P would be this year they clearly don't either.
You can lose a lot of money holding cash waiting is all
"I'm holding cash in an investable account (T212), ready for the next market meltdown." kind of suggested you were holding cash waiting to deploy it into a 10+ year investment.
I'm just gently suggesting I don't think you or I know when the next market meltdown will be and looking at the predictions of all the major investment companies of where the S&P would be this year they clearly don't either.
You can lose a lot of money holding cash waiting is all
I don't see any problem in holding short term money market funds in something like an ISA. Between now and next April a couple could put in £80k (if you haven't used your allowance already. 5% is a real yield, just bear in mind it's just not locked in to much duration so treat it as the name suggests - 'short term'.
I agree with the above though - £100k is not a lot of money on it's own, but compounded up at 5% for 20 years (in something like a diversified fund) and it starts to look a bit better.
Or buy low coupon gilts - which I know nothing about apart from the capital gain is tax free <check terminology> https://www.moneysavingexpert.com/savings/uk-gilts...
I agree with the above though - £100k is not a lot of money on it's own, but compounded up at 5% for 20 years (in something like a diversified fund) and it starts to look a bit better.
Or buy low coupon gilts - which I know nothing about apart from the capital gain is tax free <check terminology> https://www.moneysavingexpert.com/savings/uk-gilts...
OK let's spice it up a bit.
What would you do with £1,000,000?
Let's say it's currently in a T212 cash ISA dripping in ~£50,000 pa tax free in interest.
Now that we have malicious incompetent clowns in power, the interest rate not going down anytime soon.
UK financial markets are very likely to remain depressed.
US markets are going to run.
Sit on it or dabble 5-10% in US trackers etc?
What would you do with £1,000,000?
Let's say it's currently in a T212 cash ISA dripping in ~£50,000 pa tax free in interest.
Now that we have malicious incompetent clowns in power, the interest rate not going down anytime soon.
UK financial markets are very likely to remain depressed.
US markets are going to run.
Sit on it or dabble 5-10% in US trackers etc?
Writing as someone that invested the then maximum of £20,000 in premium bonds in 1992 I would not recommend that as a long term saving option.....luckily I took elsewhere in my financial investment.
Re comment about cash is "risk free"....there's no such think as a risk free investment. (In financial markets the risk free rate is that paid by Government Bonds) There are some incredibly low risk investments but nothing is risk free. Reading for a few seconds about T212 some of their products are FCS protected and some aren't. You can be sure however if the interest rate they are paying is above the bank base rate they are investing in assets that pay a higher return to pay that interest rate...i.e. there is a risk premium.
Here's a really good rule of thumb....never give money to the institution that is paying the best interest rate especially if it is above the bank base rate.
On £100k 5.17% is obviously £5,170 per year in interest, an institution paying 25bps less will still pay you £4920. The reason people hold cash rather than shares, or bonds is because capital preservation is important. Don't go chasing returns with your cash. Ask anyone that put money on deposit with the Icelandic Banks....which included about half the County Councils in the UK.
Re comment about cash is "risk free"....there's no such think as a risk free investment. (In financial markets the risk free rate is that paid by Government Bonds) There are some incredibly low risk investments but nothing is risk free. Reading for a few seconds about T212 some of their products are FCS protected and some aren't. You can be sure however if the interest rate they are paying is above the bank base rate they are investing in assets that pay a higher return to pay that interest rate...i.e. there is a risk premium.
Here's a really good rule of thumb....never give money to the institution that is paying the best interest rate especially if it is above the bank base rate.
On £100k 5.17% is obviously £5,170 per year in interest, an institution paying 25bps less will still pay you £4920. The reason people hold cash rather than shares, or bonds is because capital preservation is important. Don't go chasing returns with your cash. Ask anyone that put money on deposit with the Icelandic Banks....which included about half the County Councils in the UK.
Jiebo said:
mikeiow said:
If you haven’t max’d out premium bonds, I would do that.
Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
T212 offers 5.17%, but without the delusion that you will win big in some nonsense lottery. Tiny chance of a big win, likely chance of around 4% return, easy access for toys or uni/studies. Car & insurance for young person can eat a few grand up easily…
If you have, then stuff the ISAs, perhaps pension….maybe open a LISA/JISA/ISA for offspring & kickstart their savings.
And/or spaff some on toys….
Delusion?
For most, yes, absolutely.
That said: I do know people who have proportionally won FAR more than 5.17%, and we have generally averaged the number they suggest.
FWIW, NS&I also offer bonds - we were on a decent 6.2% rate for a year, and that rolled over to another fair rate a month or so ago.
Totally safe, easily accessible.....but sure, T212 is another option.
Phooey said:
I don't see any problem in holding short term money market funds in something like an ISA. Between now and next April a couple could put in £80k (if you haven't used your allowance already. 5% is a real yield, just bear in mind it's just not locked in to much duration so treat it as the name suggests - 'short term'.
I agree with the above though - £100k is not a lot of money on it's own, but compounded up at 5% for 20 years (in something like a diversified fund) and it starts to look a bit better.
Or buy low coupon gilts - which I know nothing about apart from the capital gain is tax free <check terminology> https://www.moneysavingexpert.com/savings/uk-gilts...
Inflation compounds over the 20 years too.I agree with the above though - £100k is not a lot of money on it's own, but compounded up at 5% for 20 years (in something like a diversified fund) and it starts to look a bit better.
Or buy low coupon gilts - which I know nothing about apart from the capital gain is tax free <check terminology> https://www.moneysavingexpert.com/savings/uk-gilts...
dave123456 said:
Inflation compounds over the 20 years too.
Sherlock, no st.Future inflation is an unknown so it could average at 2% or it could average at 22% over the next 20 years but you'd like to think central banks will manipulate it to their target of circa 2%. But the point is a globally diversified portfolio should (according to 100yrs of history) produce approx 5%, or turn 100k into 271k. If you know of a better chance of beating inflation then the forum is all ears..
Gassing Station | Finance | Top of Page | What's New | My Stuff