Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • surfer9
    • By surfer9 2nd Oct 16, 1:27 PM
    • 47Posts
    • 14Thanks
    surfer9
    What to do with 70,000
    • #1
    • 2nd Oct 16, 1:27 PM
    What to do with 70,000 2nd Oct 16 at 1:27 PM
    You are in your early 30's, you are single, you can't afford to buy a property as you live in the South East which is ridiculously expensive. You have saved 70k. Interest rates are going to return nothing very soon.

    What would you do with your savings?

    Buy. However you can - just buy.
    Buy to let.
    Invest in stocks and shares.
    Save + rent all your life, benefit with an extra 35k from the lifetime ISA.


    Buying is difficult in my area. Most expensive area outside of London.

    Buy to let. Is there much money in this these days. Especially for someone who only has enough money to buy to let a 1 bed flat in the South East / a 3 bed house in say Bristol or Portsmouth. Is the return going to be worthwhile?

    Stocks and Shares - any good opportunities here? Any good sources for solid advice?

    Renting. Are we more or less / on the verge of becoming a generation of renters (many of us in 20's/early 30's)?. Is it maybe worth just renting forever. The 70,000 is nice to fall back on, is plenty to fall back on, could even be used gradually as I get older. Though will need to think about a pension. The Lifetime ISA which comes out in April could help add 35,000 to my funds come the time I turn 50. Maybe some reasonable long term stocks/shares investments can add to that too. As well as one day inheriting at least 100,000. I don't really know what kind of money you need for retirement years on top of the State pension. So not sure that would be enough, especially as I would likely still be renting at that point and continuing to rent until I die. So will a lifetime of renting likely cause problems once retirement occurs?

    Not really sure what to do with my savings going forward...
Page 2
    • bigfreddiel
    • By bigfreddiel 8th Oct 16, 7:50 PM
    • 4,071 Posts
    • 1,866 Thanks
    bigfreddiel
    You really need to seek advice from a qualified person, see an IFA. No one on MSE is allowed to offer any advice, so please take my suggestion, ignore everything said so far and get yourself an appointment with a qualified IFA.

    If you can buy a property and haven't something is telling you it's not the right thing to do, so don't. See an IFA asap.

    Good luck fj
    • surfer9
    • By surfer9 8th Oct 16, 8:50 PM
    • 47 Posts
    • 14 Thanks
    surfer9
    If you can buy then you can rent out one or more rooms for company and extra income.

    If you don't have a conventional job then getting a mortgage might be more difficult, not impossible but potentially more expensive and maybe through a broker for example.

    Not sure where you get the rent versus service costs comparison though, dependent on the property and that is highly variable, then I'd guess what you list is probably around half your rent on average.
    Originally posted by bigadaj
    True - can rent out a spare room, if I can somehow afford a 2 bed around here. It is possible though.

    I think I will end up getting a conventional job.

    540 rent versus General costs of owning a property excluding the mortgage:

    TV License: 10
    Council Tax: 143
    Broadband and Phone: 25
    Home + Contents Insurance: 25
    Gas/Electric/Water: 140

    This comes to: 318......

    Though......

    If I added in the Sky package we have that would probably be an extra 70-80.
    I'd personally go without that luxury if I bought somewhere.

    +

    If I ended up buying a flat I'd likely have to pay some ridiculous Ground Rent/Service Charges per month/year. If I somehow managed to buy a house (extremely unlikely), I would have to maintain it. A boiler could blow. Locks may need changing. May need to call a plumber etc..

    So it's getting close to that 540. So I'd be losing that kind of money if I was to buy. So renting isn't so bad. Especially with luxuries like being able to park on a driveway, Sky TV, a cleaner every 2 weeks, a garden to use...
    • mariotr
    • By mariotr 9th Oct 16, 8:05 AM
    • 6 Posts
    • 0 Thanks
    mariotr
    The main problem I personally have with buying a house, especially at a relatively young age (I'm roughly the same age as you) is that it ties you to a place. Sure, you can sell it, but if you don't know for sure that you're going to want to be living in a given place for 10+ years, you're risking losing money in the process, as well as overcomplicating a potential move out.

    Buying is usually more expensive than renting, all things taken into account, as you point out. Also, it is true that house prices tend to go up which can offset any extra expenses, and this is one of the main reasons for buying (I've considered buying myself because of this reason alone), however, with Brexit in the works, you really don't know which way house prices are going to go.
    • surfer9
    • By surfer9 9th Oct 16, 9:12 AM
    • 47 Posts
    • 14 Thanks
    surfer9
    The main problem I personally have with buying a house, especially at a relatively young age (I'm roughly the same age as you) is that it ties you to a place. Sure, you can sell it, but if you don't know for sure that you're going to want to be living in a given place for 10+ years, you're risking losing money in the process, as well as overcomplicating a potential move out.

    Buying is usually more expensive than renting, all things taken into account, as you point out. Also, it is true that house prices tend to go up which can offset any extra expenses, and this is one of the main reasons for buying (I've considered buying myself because of this reason alone), however, with Brexit in the works, you really don't know which way house prices are going to go.
    Originally posted by mariotr
    True - a house ties you to one place.

    As a renter I am completely free to go where I like. As said in a previous post - I am a renter with plenty of savings, so I am also free to spend what I like, when I like, as well as have no worries about my income or when the next pay cheque is going to come.

    I have so much freedom, and I am totally stress free financially.

    Buying makes sense in the long-term (retirement). But getting locked into a location, having less money to fall back on, becoming a lot more restricted in my spending ie. less luxuries, and worrying about paying bills at the end of the each month will definitely restrict my freedom.

    If I had a secure salary of 25k+ I wouldn't worry too much about it. That is what I need to achieve.

    As for Brexit. It would be nice if prices fell, but don't see it happening. I don't understand how my generation and younger are getting on the property ladder and into reasonable family sized properties. You are talking ridiculous money for 3/4 bed houses around here. I'm not sure if people are moving far away, or are getting more help from parents these days. Maybe parents are passing their parents inheritance straight onto their children. It would be interesting to know what percentage of current 25-35 year olds have got onto the property ladder compared to 10, 20, 30 years ago, and how many bedrooms on average they have compared to previous generations.

    Maybe Teresa May will bring in some scheme for 1st time buyers that will truly help. It sounds like she wants to at least get more houses built, but that isn't going to affect house prices for many years, and by then house prices are surely going to be out of reach for the young at their current price acceleration.
    • fireblade28
    • By fireblade28 9th Oct 16, 9:59 AM
    • 85 Posts
    • 57 Thanks
    fireblade28
    True - can rent out a spare room, if I can somehow afford a 2 bed around here. It is possible though.

    I think I will end up getting a conventional job.

    540 rent versus General costs of owning a property excluding the mortgage:

    TV License: 10
    Council Tax: 143
    Broadband and Phone: 25
    Home + Contents Insurance: 25
    Gas/Electric/Water: 140

    This comes to: 318......

    Though......

    If I added in the Sky package we have that would probably be an extra 70-80.
    I'd personally go without that luxury if I bought somewhere.

    +

    If I ended up buying a flat I'd likely have to pay some ridiculous Ground Rent/Service Charges per month/year. If I somehow managed to buy a house (extremely unlikely), I would have to maintain it. A boiler could blow. Locks may need changing. May need to call a plumber etc..

    So it's getting close to that 540. So I'd be losing that kind of money if I was to buy. So renting isn't so bad. Especially with luxuries like being able to park on a driveway, Sky TV, a cleaner every 2 weeks, a garden to use...
    Originally posted by surfer9
    I do think buying is overrated to a certain extent from a lot of people. Most people say renting is just throwing money away. But actually it is not always the case if you actually run the numbers.

    Buying is only worth it if you have a decent low mortgage and you are in an area where the value of houses will go up significantly. Nowadays being outside major cities seems to show more growth.
    • bscjapan
    • By bscjapan 9th Oct 16, 11:20 AM
    • 2 Posts
    • 0 Thanks
    bscjapan
    With your job, you cannot buy a place, it's too risky and you could lose everything, including your 70k. In London, 70k is not a lot, so those above you are saying it is a lot, are probably Northerners, or Southerners with a lot less in their bank.
    I had 10k at 21 and got my first job and bought a central apartment in Leeds. Then at 31 I bought a central apartment in London, with 50k deposit because I was on a bigger income. Now in my 30s, I am pretty semi-retired, as I have 2 properties renting out, and I don't need to work for anything other than food and rent.
    Ulimately, its all about the job, get a better job, if you need to retrain, use that 70k to retrain. Unless you can get a mortgage, you might have 70k at 30, but you will have 70k at 40 too, and so on and so forth.
    You mentioned at 50 you will get an extra 35k, thats nothing, that will just buy you a car.
    • atush
    • By atush 9th Oct 16, 2:01 PM
    • 15,322 Posts
    • 9,199 Thanks
    atush
    oing forward:

    That said - I want to buy.

    I need to get my finances in check. I need to look into full time employment. I ideally need a model girlfriend to buy with - that would make it a lot easier to buy. And I need to always be on the look-out for that property I'm happy with. I think end of 2017 may be the time I get on the ladder.
    You do need to get your finances (and spending) in check. See what sort of mtg you c an qualify for (see a broker).

    Get a 2 bed flat, invite one of your current roomies to move in with you.

    stop being so picky. Buy a decent 2 bed flat near where you are, or in an up and coming area.

    Forget the model girlfriend. It is unrealistic, and would take a f ew years before you knew if you were going to stay together long term- and that is when you buy with someone. not a few months after you get together.
    • surfer9
    • By surfer9 9th Oct 16, 3:24 PM
    • 47 Posts
    • 14 Thanks
    surfer9
    With your job, you cannot buy a place, it's too risky and you could lose everything, including your 70k. In London, 70k is not a lot, so those above you are saying it is a lot, are probably Northerners, or Southerners with a lot less in their bank.
    I had 10k at 21 and got my first job and bought a central apartment in Leeds. Then at 31 I bought a central apartment in London, with 50k deposit because I was on a bigger income. Now in my 30s, I am pretty semi-retired, as I have 2 properties renting out, and I don't need to work for anything other than food and rent.
    Ulimately, its all about the job, get a better job, if you need to retrain, use that 70k to retrain. Unless you can get a mortgage, you might have 70k at 30, but you will have 70k at 40 too, and so on and so forth.
    You mentioned at 50 you will get an extra 35k, thats nothing, that will just buy you a car.
    Originally posted by bscjapan
    You have done very well.

    I'm in West Surrey. Not so crazily expensive as London, but not very affordable.

    70k obviously helps. But in comparison for what you get for your money around here....it will only help me get a 1 bed flat.

    I looked at Portsmouth out of curiosity and that is mega-cheap compared to here. Can get 3 bed houses with a garden for the same price as a 1 bed flat around here. Maybe a possible location to consider. Though my first thought is to stay in West Surrey.

    Yes - will need to consider my future work-wise. Always been a problem with me. Have been in mediocre employment for a while and made my savings through running small online retail businesses. Hasn't been bad, but feel I need to become more conventional and work a contracted 9 to 5 job......or should I say 8am - 6pm as that's what it seems to have become these days.

    Will need to look into what jobs are available and consider whether to spend time/money in training.
    • atush
    • By atush 10th Oct 16, 11:53 AM
    • 15,322 Posts
    • 9,199 Thanks
    atush
    Isnt east surrey cheaper than west? have you thought of moving out of surrey to hampshire or another nearby county? What is your employment, and is it in West surrey?
    • surfer9
    • By surfer9 10th Oct 16, 6:45 PM
    • 47 Posts
    • 14 Thanks
    surfer9
    Isnt east surrey cheaper than west? have you thought of moving out of surrey to hampshire or another nearby county? What is your employment, and is it in West surrey?
    Originally posted by atush
    I have browsed areas like Bristol and Portsmouth. Not with any strong motivation to move to these places, but because they are a lot more affordable than the West Surrey area. It may be a choice for the future.
    • surfer9
    • By surfer9 10th Oct 16, 8:29 PM
    • 47 Posts
    • 14 Thanks
    surfer9
    Does anyone know if anyone in the past / present has bought land as a group and built their own houses on that land?....

    I'm wondering if it is affordable to buy a large plot of land between a large group of people and split the costs. And wonder if people have done this....

    The government isn't pushing house building. House builders aren't building as the less houses there are the higher profit they can sell their houses at.

    Can't we the people build these ruddy houses instead?
    I'm not talking massive houses. Houses that use the land wisely, that don't take up too much space, but are not right on top of each other and have enough space to enjoy living in.
    • atush
    • By atush 11th Oct 16, 2:00 PM
    • 15,322 Posts
    • 9,199 Thanks
    atush
    Planning permission is very hard to get. You cant just plonk down houses anywhere you like.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

1,742Posts Today

5,849Users online

Martin's Twitter