Got £40k, what should I do with it?

kitschy

My first post! I am splitting up with my partner, and selling our joint home. I should end up with about £40k after paying off all my debts etc. I have decided to move in with my parents for at least a year and don't know what to do with the money. Should I put it in a high-interest savings account, buy a house and rent it out, buy a house and renovate it? Does anyone have any good ideas? btw, I work in conveyancing and have lots of friends who are lettings/estate agents, so the only real cost for me would be stamp duty/renovation/furnishing.

Any advice would be gratefully received!

lilyann1

I think if I had spare cash, I would buy a property to rent it out.It seems to be the thing to do at the moment.Make sure you get yourself a bargain though,as some people are not so keen to do this at the moment as there seems to be rumours of a property price crash???? Who knows if or when this may happen?

lynzpower

why not just buy yourself somewhere to live in?

kitschy

I have been paying out £700 pm for the past 6 years for mortgages etc, and I'm only 25, so I really wanted to base myself at my parents and maybe have some nice holidays and enjoy life a bit before I have the responsibilities of owning my own home again! If I bought somewhere and rented it out, I wouldn't be paying the mortgage out of my own pocket, so that would be cool!

BarmyBubba

Definately buy to rent (something I want to do in the future) as its the best form of investment these days. And then, as you say, enjoy life for a year or so.

Dead_Eye_Jones

Property prices can go up or down, make sure you are prepared for the risks, if you buy to let then perhaps ensure its somewhere you could live in if you cant off load it later...

Failing that, I'll take it off your hands - free of charge!

F_T_Buyer

How many times has property as an investment been discussed? It is very unlikely you would have a positive cash flow buying at today's prices. But people keep saying it will go up in value, so it's ok. But this is just speculating, but hardly anyone does any research..! It's totally crazy.

If you want to speculate, I could give you many many betters ideas, but i'm not advocating anyone on here speculate without knowing what they are doing - so i'm not going to suggest anything.

Add on stamp duty and buying costs, then work it out. If you do consider it, why don't you find a property (online will do) then post the figures. Then see if it's worth it.

Your best situation is put it in a savings account - search round here to find the best interest, and use your ISA. That's the only thing you can do if you want to make sure you don't lose any of your capital.

Jorgan_2

I'm with FTB on this one. If you want a safe investment, property isn't necessary the right thing to be in at the moment. If you can buy below market value, it may give you a better return.

If you want to buy in a years time, you should still have a good deposit & be in a good position to negotiate.

In the mean time, go & enjoy life.

F_T_Buyer wrote:

How many times has property as an investment been discussed? It is very unlikely you would have a positive cash flow buying at today's prices. But people keep saying it will go up in value, so it's ok. But this is just speculating, but hardly anyone does any research..! It's totally crazy.

Some people have ever only experienced a rising market, they think that property has always gone up in value & never drops.

itsakidsworld

Put your money into a high interest account and leave it for the year. Make sure you get an account that pays daily interest in case you need some of it ( but hopefully only a little!!).

This will give you a full 12 months to make a decision whilst in the meantime your cash is earning you money. Don't be lazy though and do nothing until after say 10 months or you will make the wrong decision. Study the options for the whole year and inspiration will come out of you.

If your just coming out of a relationship, buying a property to let may not be your best option at the moment as you may have emotional issues to still deal with. Buy to let is great when you look back after 20 years and you have a nice pot but it does come with alot of baggage. Can you handle this?

Enjoy your "gap year" and get back on track in a strong positive frame of mind.

Good luck with whatever you choose.

PoorDave

Don't forget to offer your parent's some of your large pot of cash for their troubles!

wobbley

F_T_Buyer wrote:

Your best situation is put it in a savings account - search round here to find the best interest, and use your ISA. That's the only thing you can do if you want to make sure you don't lose any of your capital.

I'm not saying that's wrong as each situation if different but I've just found the complete opposite to be true.
Underperforming investments have been a worry for years so we cashed them in and bought property.