What should i do with £120,000

007tobs

I have come into some money an need to do something with it then i don't start dipping in for fancy holidays etc. what should i do?
Please take into account with your answers that i work part time and probably always will due to ill health so could say i always have a net income of £400 per month. currently live with parents, have no debts.
I need a way to generate a higher monthly income not just buy a house or something to increase in value.
Any thoughts?

wileycat

If you don't want to put it into high interest savings etc..

Consider Zopa, rates should improve as the market picks up.

007tobs

CAN YOU TAKE OUT THE INTEREST YOU GAIN EACH MONTH? oops capitals
how much would i be likely to earn?

Blacksheep1979

trouble with using the interest as income is that £100 today is worth less than £100 in a years time so if your capital (or interest rates) isn't increasing in line with inflation you either need to take from the original capital or will be earning in effect less.

geordie_joe

Blacksheep1979 wrote: »

trouble with using the interest as income is that £100 today is worth less than £100 in a years time so if your capital (or interest rates) isn't increasing in line with inflation you either need to take from the original capital or will be earning in effect less.

This is true, but if you can get by on spending less that 100% of your interest your capital will grow.

e.g. if you only take out 75% of your interest and leave the other 25% in the bank.

There's always your age to take into consideration too. If you are 25 year old then you will want your money to last for many decades. So you will have to spend less than the interest you are earning.

But if you are 65 years old, you only need your money to last 20 to 30 years. So you can afford to use all the interest and some of the capital. As long as you work it so you won't run out of money until you are either dead or so old you won't care any more.

Lets face it, if we live until we are 95 years old there is a big chance we will be sitting in an old folks home, so drugged up we won't care about anything except when the next bowl of mush is due.

Blacksheep1979

geordie_joe wrote: »

This is true, but if you can get by on spending less that 100% of your interest your capital will grow.

e.g. if you only take out 75% of your interest and leave the other 25% in the bank.

True - if 25% of the interest rate you get is the same as inflation...

007tobs

cheers everyone i'm listening
have to go now i'm back online 2moz prob with loads of questions

diable

fast car and loose women or men I know its not MSE but fun ;p

geordie_joe

Blacksheep1979 wrote: »

True - if 25% of the interest rate you get is the same as inflation...

Or more than the rate of inflation

bigfreddiel

007tobs wrote: »

I have come into some money an need to do something with it then i don't start dipping in for fancy holidays etc. what should i do?
Please take into account with your answers that i work part time and probably always will due to ill health so could say i always have a net income of £400 per month. currently live with parents, have no debts.
I need a way to generate a higher monthly income not just buy a house or something to increase in value.
Any thoughts?

Okay, my account number is.......... and sort code .............:j

Blacksheep1979

geordie_joe wrote: »

Or more than the rate of inflation

Seeing as the current rate of inflation here (http://www.bankofengland.co.uk/) is 3.5% - I'd love to see where people are suggesting to stick his money that will return more than 14%. A rich Nigerian benefactor?