Best way to invest £8000

Eager_investor

I've just inherited £8000 and am looking at the investment options available. I have looked at savings and ISAs and although safe, the current rates just don't look very attractive. Having worked in Buy to Let (not investing myself but watching others) I am aware that property can give decent returns (albeit longterm) and although I don't have enough to go it alone am considering investing in property unit trusts. I have come across Self trade.co.uk who seem to offer these as an option. I am able to tie my funds up for about 5 years I think but am not keen to tie up funds in long fixed term ISAs or savings accounts as from what I can see the rates may well rise over the next couple of years and I don't want to be stuck with a bad return.

I'm new to investment and want advice on whether what I am considering is too risky. I am open to gambling but this money is all I have and so want to remain sensible (ish) Are stocks and shares ISAs a safer option to what I have discussed? Help!!

Eager_investor

Oh and I'e also been looking at silver bullions. So, a mix of unit trusts through the aforementioned, silver, s&s ISA. Sound viable or stupid?!

lisyloo

We re going to have some very painful pubilc sector cuts.
I personally don't think this is a good time to invest in property because of
1) inevitable rising interst rates medium term
2) credit crunch still with us
3) increasing unemployment meaning increasing repossession and increasing supply
4) pay cuts/freezes for those still in work
5) possibiilty of double dip recession

Shares are as safe/risky as you want them to be, but you can spread them.

Let's first step back a bit.
Do you have an emergency fund to give you 3-6 months money should you be made redundant (also for car crash, boiler failure etc.).
Is it big enough for you to live on for 6 months?

If not then first step is to build an emergency fund.
I woudl suggest getting the highest rate cash ISA you can for this.
Do you have a spouse, so can use their allowance?

Eager_investor

Hi, thanks for your reply. I am in the best possible situation financially as I am currently living rent free with my parents while I study (graduation next year). I work for myself at a market which brings me in more than enough for spending money. I probably won't be moving out for at least a year so am in a great position.

debbie42

Eager_investor wrote: »

and although I don't have enough to go it alone am considering investing in property unit trusts. I have come across Self trade.co.uk who seem to offer these as an option. I am able to tie my funds up for about 5 years I think but am not keen to tie up funds in long fixed term ISAs or savings accounts as from what I can see the rates may well rise over the next couple of years and I don't want to be stuck with a bad return.

You can purchase shares within a S&S ISA: it's a tax shelter. There are certain restrictions, for example AIM shares aren't eligible unless they are dual listed on a recognised exchange.

Selftrade have an annual management fee (for ISAs and dealing accounts): there are other (better, IMO) options that you could consider, if you want to invest in shares or funds. I've just moved my account from Selftrade to Interactive Investor for share dealing and my S&S ISA. The service was awful at times at Selftrade, and this was a factor in my move.

Interactive Invsetor have cheaper dealing charges, and no annual management charge. For funds (as opposed to shares), Hargreave Lansdowne are often recommended on here. I do have an account with them, but it's very new, so I can't comment on the service, as yet.

Eager_investor

Thanks Debbie,

I will have a look at Interactive Investor; no annual management fee sounds good to me!