Finally debt free and now need to make up some ground.

atush

My biggest worry for you is that you took a 200K pension fund and used it to pay debt and give a gift toyour daughter instead of using it for it's intended purpose of funding your retirement.

Some of this can be made up in increasing your current contribs and saving like mad, but I am worried about the easy way out your gave your daughter and will she again bulid up debt as she didn't have to truely face the consequences of her actions?

In any case, The route for you and your 95K will depend on your current residency (ie spain or UK) and what the tax regime is like where you live. If the UK you need to shelter as much into tax free ISAs and NSI prodcts as you can and then put the rest into the highest rates you can get and maybe some equtiy investments too. Overpaying a mtg is a good idea IF the rate you are paing is higher than any savings rates you can get.

You should keep 6 months spending in cash based fairly easy access.

rigpig

Tuesday_Tenor wrote: »

>>>>> I´m an investor not a saver
That's helpful, as I can't help further!

Except to say:

Surely you need to be both?
Savings for emergencies, contingencies and your plans for the next 5 years.
Investment of any surplus for gains (or losses) further into the future. I understand that even 5 years is quite short-term for an investment.

You say you've had money problems in the past. Not having savings to deal with emergencies and your short-term plans could lead to money problems in the future!

(I know you HAVEN'T said you're going to invest it ALL, so I'll credit you with SOME common sense. It was just the 'not a saver' which set a few alarm bells ringing, so I just wanted to re-iterate my point. Good luck!)

I think you have read my mind but I have not been very clear. My current home and work pension are on track to provide retirement funds, I have made conservative projections and not included any future pay rises.

The 95K is really a contingency fund which I intend to add to each year at around 5k sterling, it will be invested in various things which I have not fully decided on, hence this post. But one criteria will be a small amount of risk and the ability to take cash back if required.

My only real fear is losing my job, I'm covered for just about every eventuality (Health, Death, Disability) while I'm employed but in the current economic climate who knows what's around the corner so the 95K is my "parachute" I also now have a large amount of equity in the house in Spain so the worst case option if things go wrong is we sell up move home buy a more modest house for cash and I drive a taxi for a living.

Thanks for your time, you have given me something to think about.

Rigpig.

rigpig

atush wrote: »

My biggest worry for you is that you took a 200K pension fund and used it to pay debt and give a gift toyour daughter instead of using it for it's intended purpose of funding your retirement.

Some of this can be made up in increasing your current contribs and saving like mad, but I am worried about the easy way out your gave your daughter and will she again bulid up debt as she didn't have to truely face the consequences of her actions?

In any case, The route for you and your 95K will depend on your current residency (ie spain or UK) and what the tax regime is like where you live. If the UK you need to shelter as much into tax free ISAs and NSI prodcts as you can and then put the rest into the highest rates you can get and maybe some equtiy investments too. Overpaying a mtg is a good idea IF the rate you are paing is higher than any savings rates you can get.

You should keep 6 months spending in cash based fairly easy access.

Thanks Atush

You are correct in the respect that I have spent some of the money to pay off loans but my house is my biggest investment. We bought it 20% under valuation because it needs a fair amount of work and are renovating it as we live in it. We plan to sell it at retirement and build a new house in the country which will release 50% of the equity while giving us the same standard of living. (The current location is very desirable)

I didn't give a gift to my daughter, I lent her some money and she is paying it back with a mutually beneficial interest rate. I think she has learnt her lesson, they were on the brink of getting into trouble and had not told us how bad it was. But if not, what parent could sit by and not offer to help given the opportunity.

As mentioned in the previous post my work pension is my my main source of retirement income (as well as the house) so the remaining money is something I want to invest and grow to add to those funds or use in an emergency. which you have mentioned.

We have not really deprived ourselves while getting out of debt but have lived on a reasonable budget, now those payments are gone and we have set a balance between building some serious investments and enjoying our lives now, we still have a nice disposable income which could be used to invest after we splurge out on some things we have not had for a while. I have not changed my car for seven years and it was seven years old when I bought it so that's something we are considering but we'll save up for it and not buy it out of our current funds. I made mistakes in the past mostly i think because I was young and people were far to keen to give me credit. But hopefully I've learned by them.

I just need to have a selection of opinions and Ideas on how best to invest.

Thanks,

Rigpig.

unkle

How much does your mortgage have remaining? Maybe switching to an Offset mortgage will help, lower the monthly payment and meaning you can save/invest more and not get taxed on savings.

xylophone

For what it's worth I think you were right to help your daughter - just one thought though, if you are receiving interest on the loan, are you declaring it? Or don't you need to where you're taxed?

Everybody wants a small (and preferably no) risk! The choice seems to be gilts, deposits, equities/corporate bonds. Depending on where you are taxed though, you could be paying a lot of tax? Perhaps as the poster above suggests, the flexible offset mortgage would suit your circumstances?

atush

I agree you were right to help your daughter, and if she is paying you back then she will not get somehting for nothing which was my worry. My mom did that with my sister several times, but she didn't have to pay it back and was soon back into debt.

Still not sure where you are living now, but if in Spain you can't use ISAs for your savings (not sure if there is a spanish equivilent). and if you will eventually come back to the UK you may want to keep some of your cash in euros and the rest in the UK.

rigpig

unkle wrote: »

How much does your mortgage have remaining? Maybe switching to an Offset mortgage will help, lower the monthly payment and meaning you can save/invest more and not get taxed on savings.

No products like this in Spain, I've asked. It's also quite difficult to jump mortgages, they have to be notorised and there are quite large fees involved. This also applies if you want to change your monthly payment.

I have the money to invest and still have a fairly healthy disposable income. We have been careful with money for a while now when we were in debt and we really want to start and enjoy ourselves again.

Rigpig.

rigpig

xylophone wrote: »

For what it's worth I think you were right to help your daughter - just one thought though, if you are receiving interest on the loan, are you declaring it? Or don't you need to where you're taxed?
QUOTE]

I don't pay taxes in UK or in Spain. I actually work in India and my taxes are paid there. I've been out of the UK tax system for 7 years now and the amount I'm receiving from my daughter is pretty small, it certainly comes within my allowance. Technically I suppose I would have to declare it?

Spain has a 180 day rule and I spend more than this out of Europe so no real hassle, Both UK and Spain have reciprocal tax agreements with India anyway but as I don't spend enough time in Europe I don't have to file a return.

Thanks, Rigpig.

rigpig

atush wrote: »

Still not sure where you are living now, but if in Spain you can't use ISAs for your savings (not sure if there is a spanish equivilent). and if you will eventually come back to the UK you may want to keep some of your cash in euros and the rest in the UK.

I live in Spain (It's my primary residence) but I work in India, approx one month home one month away. Because I'm not in Spain more than 180 days per year I do not have to be a resident, just register with the local council for local council taxes and a small property tax. The downside of his is that there are fewer financial products that I can use. Even so the Spanish financial market does not seem to offer anywhere near the variety that we were used to in the UK. That's why I'm going to see the expat investment people because I have no idea what sort of products are out there for people like myself, I'm just trying to educate myself a little bit before I go.

At this time we don't plan to return to the UK to live but who can say what happens in the future.

Thanks,

Rigpig,

Ifts

rigpig wrote: »

That's why I'm going to see the expat investment people because I have no idea what sort of products are out there for people like myself, I'm just trying to educate myself a little bit before I go.

Well done for trying to educate yourself before going to see the expat investment people, you are doing the right thing.
Don't agree to sign-up to anything at the first meet, bring the info away with you and do as much research as possible into any recommendations they make.
And maybe post them on here, and see if the good people in the know about investments for expats can shed any light on them for you.

Don't want to scare you but I saw this article the other day how expats are having problems over there: Expats take on Rothschild over equity release schemes (also worth reading the comments in that article by expats who have lost money).

Good Luck