Investment Advice needed

plinth

Hello

My mum recently passed away and left me 30k I had £116.750 left on my mortgage and RBS said I could pay off 10% without penalty which I did however any other ammount payed off would be charged at 3% as I am on a 5 year fixed mortgage.

I have 18k left and it is earning 3% intrest in the bank does anyone have any sugestions how I could put this to better use?

Any advice would be much appreciated

Regards

Bill

BLB53

I have 18k left and it is earning 3% intrest in the bank does anyone have any sugestions how I could put this to better use?

Open a S&S ISA with a low cost online broker and put half you money in investment trusts from the UK inc & growth sector - you should be able to get a starting return of 5% pa.

bigfreddiel

BLB53 wrote: »

Open a S&S ISA with a low cost online broker and put half you money in investment trusts from the UK inc & growth sector - you should be able to get a starting return of 5% pa.

....and a drop in capital of 10%+

meteoraln

If your penalty is 3% and you are receiving a 3% interest rate on the 18K, you're actually better off paying down the principal more along with the penalty. Otherwise, you'll just get taxed on the interest earned vs lower interest payments after paying down more principal.

opinions4u

Amazes me how people can offer answers without knowing the rate of interest on the mortgage.

atush

I don't know as you didn't say your mtg rate, if that was the right dcision. It may have been.

But to help further, you need to give us more details.

Do you have other savings? Are you employed (and paying tax and what rate)? Do you have a pension? How many years til you hope to retire? Do you have other investments apaort from your home and the cash left to you? Are you married? Do you have dependants?

All these and more that we haven't asked yet will shade our opinions.

plinth

Hello All

I hadnt responded but thank you so much so far- my mortgage rate is fixed at 5.49%. The total savings are 25k however I dont have a pension- I had a 160k mortgage which I focused on paying down over last 2.5 years I have 28 years left to work and own a house that I rent out (it covers itself but no more than that) I am married with 3 kids. I am on 45k a year and my wife is on 40k we have always aimed to overpay on the mortgage and save £500 a month for hols, car insurance etc

Hope that helps

atush

You are near the HRT threshold, and will possibly go over if you make sure you get enough interest on your balance. So you need to start a pension (OH too). Join one if employers have one and contribute. A low cost PP if not as it will keep you from paying HRT.

Cash Isas for you and your spouse would be the best way to go is you want to keep things liquid for now re the savings.

Bit confused, abt property. Just one BTL, or one family and one BTL? If so, you are strong on property so need cash sa vings then equities to balance.

plinth

I thought I was over the HRT, work does offer a pension scheme so I can look into that tomorrow. I can sort out 2 isas tomorrow as well-I have a main house and I have a buy to let that I purchased 5 years ago and for £169.000 and have a £105.000 mortgage left on it.

atush

If your employer has a scheme and you haven't joined it means you have been passing up free money! Def join tomorrow. Open the ISAs. then you are almost there.

Nessie23

I am not too sure if RBS do one, but have you considered and offset mortgage? It would allow you to keep your savings, but at the same time it would also reduce your monthly interest payments.