Recieving a large sum of money soon - What to do with it?

bargainbonkers

I'm wondering if anyone can give me some advice. I'm due to be getting a lump sum of money next year, about £30,000, from my parents' house sale. A few years back my half sisters recieved the same sum from the sale our mother and her ex-husbands house, and my Mum felt it was fair for me to recieve the same once they had the money.

My sisters spent all their money on clothes and holidays etc and are now back to square one. I always had a different approach to money (But never had it to "play" with) and now I am being given the opportunity, I want what I recieve to stretch, or even expand. I don't want to touch it unless I absolutely have to.

What is the most sensible thing to do with this money? Save? Invest? Any tips would be much appreciated!

amcluesent

>What is the most sensible thing to do with this money?<

Depends entirely on your own circumstances, age, income, dependants, current debt/mortgage, tax/benefits position. See an IFA.

The usual advice would be to pay CC debts now, then if you can wait 10+ years invest in stock-market fund, otherwise put into a savings account with the sort of term/access options to suite you.

Stavros_3

If you want absolutely no risk with that amount then it needs to go into some sort of savings acount, you mention that you don't wish to touch it, in that case look for a good fixed rate savings account for around 2-3 yrs (I never go beyond 1 as the rates do change)

However if you want growth on that amount beyond what savings will give then you need to consider investing which is a minefield. If you want to go down this line you need to be honest with yourself as to your attitude to risk is, remember investments can go up or down, basically attitudes to risk are low, medium or high, or in investments terms, cautious, balanced or adventorous, the higher the risk the bigger the gain (or loss).
If again you want to invest and you have absolutely no idea how to go about it you need to speak to an Independent financial advisor, note the independent part highlighted, please do not use so called advisors at banks or building society's as all they are are sales persons who will sell you a poor selection of investments.
There has been many cases of late where customers were mis-sold investments because they were High risk when in fact the customer wanted a cautious approach (Low risk) and they lost most of their capital.
In closing, if you don't know an Independent financial Advisor in your area go here http://www.unbiased.co.uk/find-an-ifa/ to find one. Don't accept what they say on face value though, get into their ribs regarding their past performance and demand to see evidence of that, good luck

bargainbonkers

>What is the most sensible thing to do with this money?<

Depends entirely on your own circumstances, age, income, dependants, current debt/mortgage, tax/benefits position. See an IFA.

The usual advice would be to pay CC debts now, then if you can wait 10+ years invest in stock-market fund, otherwise put into a savings account with the sort of term/access options to suite you.

I'm 18, don't have a credit card (Don't really want one) unemployed, no kids, my boyfriend has a 4k loan I'm willing to pay off for him, and I am about to apply for benefits around now to help us live as it's very tight.

Thanks for your help

Thanks Stavros too, that was very informative. My step-dad has been an investor for most of his life, gained a lot and lost a lot too

Masomnia

bargainbonkers wrote: »

I'm 18, don't have a credit card (Don't really want one) unemployed, no kids, my boyfriend has a 4k loan I'm willing to pay off for him, and I am about to apply for benefits around now to help us live as it's very tight.

Thanks for your help

Thanks Stavros too, that was very informative. My step-dad has been an investor for most of his life, gained a lot and lost a lot too

With £30k at your age I think I'd see an IFA too. I doubt you'll get any benefits with savings that large, so that's something to think about.

Not to put a dampener on things, but don't pay off your boyfriend's loan. It's his debt and his responsibility.

amcluesent

>I'm 18, don't have a credit card (Don't really want one) unemployed, no kids, my boyfriend has a 4k loan I'm willing to pay off for him, and I am about to apply for benefits<

At 18, that £30K should be used as a life-changing opportunity, not put away to get a miserable 2%. I'd chuck the bf and move to London and see what you can make of yourself.

Masomnia

amcluesent wrote: »

>I'm 18, don't have a credit card (Don't really want one) unemployed, no kids, my boyfriend has a 4k loan I'm willing to pay off for him, and I am about to apply for benefits<

At 18, that £30K should be used as a life-changing opportunity, not put away to get a miserable 2%. I'd chuck the bf and move to London and see what you can make of yourself.

Scratch my suggestion I'm with him.

Did you ever get that Nationwide ISA sorted btw?

bargainbonkers

amcluesent wrote: »

>I'm 18, don't have a credit card (Don't really want one) unemployed, no kids, my boyfriend has a 4k loan I'm willing to pay off for him, and I am about to apply for benefits<

At 18, that £30K should be used as a life-changing opportunity, not put away to get a miserable 2%. I'd chuck the bf and move to London and see what you can make of yourself.

I don't think so, we're getting married next year, and I'd never be able to live in the city Even if I got more money from it, I'd have to decline!

buglawton

Trouble with 'life-changing' decision with such cash at your age is, take a few turns and the money's gone by the time you are 22.

I can understand people on this thread giving advice on how to optimize the safe interest you can get, perhaps what you also need is advice on what to do with your life! There are enough 4-percent-ish offers around if you don't withdraw the savings in 2 years, take one of them and postpone any big decisions.

Also, if BF borrowed £4k it was of course, responsibly with a concrete plan on how he planned to repay that loan? In which case he does not need it to be suddenly repaid as a gift (a genuine BF would in fact refuse any gift above a few hundred £ and instead be just as concerned as you on how to use the windfall for your own long term benefit).

NJW69

I would put some into an ISA and then look around for the highest interest rate account that doesn't tie your money up too much for some of the rest. It's upto you if you want to pay your B/F loan off but you are quite young at 18 and you never know what may happen and it is a lot of money to loose if things don't go according to plan.

bargainbonkers

Trouble with 'life-changing' decision with such cash at your age is, take a few turns and the money's gone by the time you are 22.

I can understand people on this thread giving advice on how to optimize the safe interest you can get, perhaps what you also need is advice on what to do with your life! There are enough 4-percent-ish offers around if you don't withdraw the savings in 2 years, take one of them and postpone any big decisions.

Also, if BF borrowed £4k it was of course, responsibly with a concrete plan on how he planned to repay that loan? In which case he does not need it to be suddenly repaid as a gift (a genuine BF would in fact refuse any gift above a few hundred £ and instead be just as concerned as you on how to use the windfall for your own long term benefit).

Now I feel savings is a good idea, I want to keep the money in there until I'm in my late twenties, early thirties so I'll go for one of the 4%ish offers like you said.
I was never planning to lend it to him, more give, as everything we earn we share, therefore the savings would be "both of ours" too. He never asked for help, but I know that if that loan is paid off we will have a better quality of life as we will be able to come out in the plusses each month, not have to eat into his overdraft and possibly add extra money to the savings each month. So, paying the loan off is just as beneficial to me as it is to him.
He's had to live with my mental illness that has left me unable to work for the past 10 months so he's probably spent that much on my living costs already.