Due to inherit 70K..help

debGmumtowilliam

Hi, not posted before but am hoping for some advice..

I'm a basic rate tax payer and have just had word i have just inherited 70K. I've never had any type of bequest before and don't know if i need to declare it (tax )??

Anyone with any experience out there please help ? I know it's a nice dilemma to have, but i'd hate to be bitten in the behind 6 months later

Thanks:cool:

Pee

You don't need to declare it for tax, although you will need to declare any income from it.

I suggest the first thing you do is work out what you want to do with it. Perhaps £5,000 for a holiday, £10,000 for emergency savings and the remainder to pay off the mortgage.

You might be thinking, in two years I'll need £x for that and in five years £x for that.

In my opinion any money you want within the next five years should be invested in cash - probably cash isa's. Any that you will want in six or more years time - maybe retirement savings or for a child to go to University you should take financial advice and probably expose to the stockmarket. I suggest you speak to a couple of financial advisers and go with the one you feel most comfortbale with. You want an independent financial adviser.

Ifts

First pay off your debts if you have any, the interest on these is more likely to be greater than you'll get on deposit accounts. If you have got a mortgage and the rate is more than you can get on deposit, see if you can pay off any of the capital to reduce your mortgage.

If you want to save the money, have a look at an ISA if you have not got one. Index linked certificates from NS&I are another option.

1 year fixed term saving account's are paying 3.25% (6 month @ 3.02%), you can get more if you are willing to tie your money up for longer but risk loosing out if rates go up during the fixed rate period.

Instead of tying your money up for a year at 3%, you can get just below this (2.8% ish) with easy access savings accounts from the AA, Egg and Tesco's (with a fixed bonus for a year)