How to invest £80,000

mutter

DiggerUK wrote: »

A bereavement and an inheritance is a bitter sweet experience, hope you are coping well.

Thank you.
I'd give it all back for five more minutes with my mum, but I'm sure I'm not alone in that.

Noone's mentioned property, which was my first thought (probably a result of all those tv programmes!).
I live close to Brighton, and if I used the entire sum, I could (surprisingly) buy a decent central studio or 1 bed flat outright, and rent it out for up to £550 per month (obviously before tax and fees).

Without a mortgage to service, wouldn't that be a good return (and a possible retirement home in my dotage).
Or is property just too much of an unknown at the moment?

webmasterpolo

Hi Mutter

My condolences.

Property is more volatile at the moment than recent history. The property shows you mention virtually always show a good profit, but in a risking market it near impossible not to. If you did decide on this route you would need a contingency fund to cover any repairs and issues with it, so you cannot commit all of your capital to the purchase and purchase costs. If you did choose this route you may benefit from purchasing more than one property using interest only mortgages, thus gearing your purchases. Eg buying 3 houses with mortgages rather than one without a mortgage may bring in a higher return, and the mortgage interest would be tax deductible.

If you would prefer a hands off approach (property will tie up more of your time than you realise, even with full a good agent) which would leave you to focus on your day job, I would def look for an IFA. I don't know why Digger says you wouldn't need one, perhaps he has had a bad experience in the past. As already stated perhaps meet with more than one to get a feel for the service they offer their clients. They are not all the same. The service and the fees will vary, you need to find a balance that you are happy with. The cheapest may not be the best service, especially if it means they take little care of your money while it's under their stewardship.

If you have a company pension, then finding out more about your options here would be worthwhile, as you will get tax relief on any contributions, so you may want to put a portion of you long term money into it, the rest in ISAs. Bear in mind of course that with a pension it is less flexible than an ISA so in exchange for the tax relief you will loose flexibility now and when you retire you will be taxed on the income taken.

I hope this helps, you first step is really to meet with some IFAs and seek professional advice. The first meeting at least should be free, so take a day and meet with 2 or 3 to hear their ideas.

Good luck.

-Web

Filey

webmasterpolo wrote: »

Hi Mutter


I hope this helps, you first step is really to meet with some IFAs and seek professional advice. The first meeting at least should be free, so take a day and meet with 2 or 3 to hear their ideas.

Good luck.

-Web

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Mutters advice is good. Definitely get several opinions and definitely go fee based.

I know there must be lots of honourable and honest IFAs but the problem is, how can you tell.