Where should I invest 70K

Savvy_amateur

I have just inherited 70k and have no idea what to do with it. I don't have any debts, but would like to use it to help fund my pension in 10 years. I quite like the thought of co-buying a buy to let with my daughter. What do you think? Or if not any advice?

dunstonh

I quite like the thought of co-buying a buy to let with my daughter.

£70k isnt going to go very far on a buy to let unless you borrow and that turns it into a higher risk investment. Plus, timing for buy to let isnt great right now. Rental yields have improved but are still low but getting closer to being attractive. Property prices are still dropping and that has some way to go yet.

Lokolo

My back pockets feeling a bit light if you're in a generous mood...? :beer:

antiludd

If his daughter is also chipping in 70k, then that's a different matter.

I would say now is a good time to start planning a buy to let.

Savvy_amateur

dunstonh wrote: »

£70k isnt going to go very far on a buy to let unless you borrow and that turns it into a higher risk investment. Plus, timing for buy to let isnt great right now. Rental yields have improved but are still low but getting closer to being attractive. Property prices are still dropping and that has some way to go yet.

Thanks dunstonh
My daughter would put up the other half of the money, so I would not have to borrow anything. (I have no mortgage myself), Should I do it later in the year, then? Or not at all and if not, what should I do with it.

slummymummyof3

Surely, it would be an idea to see how stable the economy and indeed house prices are rather than second guessing about buying later in the year. No-one knows how long the house proces are going to continue dropping for.....you have no urgency to buy a property, it is not going to cause you financial harm by waiting rather than trying to second guess the market. House prices will take a considerable length of time to recover once they have finished dropping.

opinions4u

Putting all your inheritance in to one property seems a little bit over-exposed on the "eggs in one basket" side.

I think we've got another 15% drop in property prices to go, and then 2 or 3 years of nil growth. Even after this I think banks will be less willing to rely on wholesale funding to lend. This will also hit any recovery in the property market.

I don't know your tax situation, your income, your other assets and investments or your pension provision.

I would book appointments with two local (reputable) IFAs and listen to what they have to say. Then go with the one who makes the most sense to you.

It's a key stage of life and I'm sure the person who left you the money would be keen to ensure you got the best use from it.

Oh, and make sure you treat yourself to something nice before you stash it away!

dunstonh

Surely, it would be an idea to see how stable the economy and indeed house prices are rather than second guessing about buying later in the year.

I agree. We are 18 months into this house price crash. The last saw the drops last 4 years. Its impossible to call.

My daughter would put up the other half of the money, so I would not have to borrow anything. (I have no mortgage myself), Should I do it later in the year, then? Or not at all and if not, what should I do with it.

Do you think you are able to handle a buy to let property? e.g. the work, the costs, the dead periods, the tax, landlord requirements etc

Also, do you think you are able to pick the right property to get a decent rental yield net of tax and costs?

In the days of growth, a monkey could have made money picking properties to profit on but that market has gone now and its really only for the skilled landlord now.

Savvy_amateur

Thanks very much everyone. Yes food for thought indeed.