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  • FIRST POST
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 2:36 PM
    • 7Posts
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    ChineseGypsy
    Investment Advise
    • #1
    • 6th Dec 17, 2:36 PM
    Investment Advise 6th Dec 17 at 2:36 PM
    Hi everyone,
    I realise the right answer is go to a financial advisor but all opinions are welcome.
    I'm 33 earning around £30k a year, my wife doesn't earn anything and we have around £130k in savings and no mortgage.
    We was in the middle of buying a house but the sale fell through when the surveyor found subsidence.
    Currently I have 50k is Premium bonds, 20k earning 1.5% and the rest in a 1% interest account.
    I was just wondering what people would do with the money?
    Are dividend paying stocks a good option? Or go for LISA for the 25% bonus?
Page 1
    • MallyGirl
    • By MallyGirl 6th Dec 17, 2:52 PM
    • 2,102 Posts
    • 6,975 Thanks
    MallyGirl
    • #2
    • 6th Dec 17, 2:52 PM
    • #2
    • 6th Dec 17, 2:52 PM
    if you are still likely to be using the money for a house purchase then Stocks wouldn't be the right choice
    • dunstonh
    • By dunstonh 6th Dec 17, 2:56 PM
    • 89,957 Posts
    • 56,662 Thanks
    dunstonh
    • #3
    • 6th Dec 17, 2:56 PM
    • #3
    • 6th Dec 17, 2:56 PM
    I was just wondering what people would do with the money?
    What are the objectives for the money? You are asking for solutions without telling us what you are looking to achieve.
    Are dividend paying stocks a good option?
    Depends on what your investment strategy is. what your tax position is. what your knowledge and experience is and the objectives you are looking to achieve.

    You would not normally see an inexperienced investor looking to buy shares. Funds tend to be the starting point.

    Or go for LISA for the 25% bonus?
    You can hold dividend-paying stocks in a LISA. Its like asking which is best, a car or petrol. LISA is not an investment. It is a tax wrapper. The UK has multiple tax wrappers (ISA, LISA, pension, onshore bonds, offshore bonds and unwrapped amongst others). Typically, you choose the most tax efficient wrappers to meet the objective.

    Which brings us back to what you are looking to achieve - which is?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 3:54 PM
    • 7 Posts
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    ChineseGypsy
    • #4
    • 6th Dec 17, 3:54 PM
    • #4
    • 6th Dec 17, 3:54 PM
    Ahh yes, good point.

    So I'm looking for options on what to do. Since my wife isn't working she using her personal tax allowance so I was thinking dividend paying stocks as a good way to use her tax.

    I have a work based pension which probably isn't very good so maybe a LISA would be a good way of topping that up ready for when I'm 60.

    Does that make sense?
    • capital0ne
    • By capital0ne 6th Dec 17, 4:01 PM
    • 149 Posts
    • 80 Thanks
    capital0ne
    • #5
    • 6th Dec 17, 4:01 PM
    • #5
    • 6th Dec 17, 4:01 PM
    Hi everyone,
    I realise the right answer is go to a financial advisor but all opinions are welcome.
    I'm 33 earning around £30k a year, my wife doesn't earn anything and we have around £130k in savings and no mortgage.
    We was in the middle of buying a house but the sale fell through when the surveyor found subsidence.
    Currently I have 50k is Premium bonds, 20k earning 1.5% and the rest in a 1% interest account.
    I was just wondering what people would do with the money?
    Are dividend paying stocks a good option? Or go for LISA for the 25% bonus?
    Originally posted by ChineseGypsy
    So you're not buying a house now,and your wife pays no tax.
    You could take some of your wife's tax allowance and back date that for the last three years
    You don't need the money for anything now or in the next ten years,then go for a stocks and shares ISA for you and your wife.
    • EJS_Superted
    • By EJS_Superted 6th Dec 17, 4:03 PM
    • 41 Posts
    • 19 Thanks
    EJS_Superted
    • #6
    • 6th Dec 17, 4:03 PM
    • #6
    • 6th Dec 17, 4:03 PM
    You still haven't told us if you plan to buy a house.

    Is that £20k earning 1.5% with Santander? If so, do you have the regular e-saver that earns 5%?

    A stocks and shares LISA in addition to your pension is a sensible thing to consider if you don't need the money for anything else but you can only contribute £4000 per year (all the more reason to do it sooner rather than later).
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 4:16 PM
    • 7 Posts
    • 0 Thanks
    ChineseGypsy
    • #7
    • 6th Dec 17, 4:16 PM
    • #7
    • 6th Dec 17, 4:16 PM
    So you're not buying a house now,and your wife pays no tax.
    You could take some of your wife's tax allowance and back date that for the last three years
    You don't need the money for anything now or in the next ten years,then go for a stocks and shares ISA for you and your wife.
    Originally posted by capital0ne
    Already claiming the marriage tax allowance.

    No not buying the house and the whole thing has left a sour taste in our mouths.
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 4:21 PM
    • 7 Posts
    • 0 Thanks
    ChineseGypsy
    • #8
    • 6th Dec 17, 4:21 PM
    • #8
    • 6th Dec 17, 4:21 PM
    You still haven't told us if you plan to buy a house.

    Is that £20k earning 1.5% with Santander? If so, do you have the regular e-saver that earns 5%?

    A stocks and shares LISA in addition to your pension is a sensible thing to consider if you don't need the money for anything else but you can only contribute £4000 per year (all the more reason to do it sooner rather than later).
    Originally posted by EJS_Superted
    Yes to Santander, and yes to the e-saver. I'd be open to changing bank account though.

    Exactly my thoughts on the LISA, but I think you get the same bonus with tax relief on pensions, right?
    • dunstonh
    • By dunstonh 6th Dec 17, 4:31 PM
    • 89,957 Posts
    • 56,662 Thanks
    dunstonh
    • #9
    • 6th Dec 17, 4:31 PM
    • #9
    • 6th Dec 17, 4:31 PM
    Exactly my thoughts on the LISA, but I think you get the same bonus with tax relief on pensions, right?
    Pensions get tax relief, tax free growth and are outside of the estate. LISAs get a bonus (not tax relief), tax free growth but are inside the estate. Pensions can increase benefits (such as tax credits) LISAs cannot.

    Limited choice on LISAs can mean they are not as good as pensions.

    I have a work based pension which probably isn't very good
    "Probably" is not a good way to decide your finances. Is it a good scheme or not? if not, what is it that makes it that way?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 5:10 PM
    • 7 Posts
    • 0 Thanks
    ChineseGypsy
    I had 7 years in a military pension but right now I'm paying into the workplace pension at around 2% of my wage.
    • AlanP
    • By AlanP 6th Dec 17, 5:45 PM
    • 999 Posts
    • 708 Thanks
    AlanP

    No not buying the house and the whole thing has left a sour taste in our mouths.
    Originally posted by ChineseGypsy
    This has made me curious - Why?

    If you had gone through with the purchase and then found out about the subsidence I would have a sour taste in my mouth - particularly with the surveyor.

    It sounds to me like the surveyor has done a great job for you, exactly as you would hope.

    More generally I would expect there to be quite a few on here that have bought / sold their house maybe 2/3/4 times over the years who haven't had a deal / chain fall apart at some stage.

    I have, disappointed at the time, but just carried on looking and found a different one.
    • ChineseGypsy
    • By ChineseGypsy 6th Dec 17, 6:09 PM
    • 7 Posts
    • 0 Thanks
    ChineseGypsy
    The surveyor did do a great job and you're right it could have been way worse with us paying £60k to fix the subsidence. (the seller filled in the cracked with sealant to cover up the cracks, I was pretty annoyed at that)

    I guess it's just left us a bit scared of the property game.
    • BananaRepublic
    • By BananaRepublic 6th Dec 17, 7:06 PM
    • 938 Posts
    • 680 Thanks
    BananaRepublic
    A house to live in is in my view the best investment one can make, assuming there is no good reason why you can't buy such as moving around for work. It is tax free, apart from stamp duty and council tax, but you pay the latter on rented accommodation anyway. And you get a nice house to live in which you can modify as you see fit. The mortgage payments in large part effectively go into your pocket, rather than into a landlords.

    As for buying, subsidence is rare, but you used a surveyor so you did well. Almost everyone buys house insurance which covers you against most issues. And I suspect you can sue someone if they sell you a house without disclosing an issue such as subsidence, not sure, doubtless someone here will know.
    • ChineseGypsy
    • By ChineseGypsy 7th Dec 17, 10:51 AM
    • 7 Posts
    • 0 Thanks
    ChineseGypsy
    Sorry Banana, I think you've got the wrong end of the stick.

    I have a house to live in and it's mortgage free, the second house was as a buy to let investment and use my wife's tax allowance to collect the rent.
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