Just inherited £100k......

opinions4u

pqrdef wrote: »

No you don't. 2-3 years before retirement is the time to be thinking about selling shares, not buying them.

It depends on when you expect to draw down the capital.

With longer life expectancy the traditional "convert to cash" approach isn't automatically the right thing to do.

barginunter

Thanks everyone, some good pointers given. I am 56, my husband (main earner) is 64 so he will be retiring I would think in the next 2 years. My income is derisory compared to his. We have no mortgage, no debts but an expensive 18 year old still at home. When hubby retires our income will reduce considerably so I suppose I'll be looking for income as well as growth. We will (I hope) move out of this area (NW) and perhaps relocate further South or even abroad. The last 2 years we have had some expensive holidays (and enjoyed every minute of them) but I realise we should perhaps not be throwing so much money around at this stage of our lives . How did I get to be this old - it seems to have happened practically overnight?

atush

pqrdef wrote: »

No you don't. 2-3 years before retirement is the time to be thinking about selling shares, not buying them.

Wrong, unless you have index linked DB pensions.

Cash invested even long term wil only just cover inflation if that. there will be no growth. A drawdown pension, or S&S isas for part (not all ) of your retirement pot can be very effective in beating inflation and seeing some growth. And in the Op's case we aren't talking a pension pt for an annuity but an inheritance so even more reason to invest SOME (not necessarily all) of that pot.

The GO to CASH in pensions is meant for those who will buy an annuity in the next year to 18 months. But annuities can be poor value compared with other retirement options for 100% of your cash. So keeping some funds in equities is essential.

atush

barginunter wrote: »

Thanks everyone, some good pointers given. I am 56, my husband (main earner) is 64 so he will be retiring I would think in the next 2 years. My income is derisory compared to his. We have no mortgage, no debts but an expensive 18 year old still at home. When hubby retires our income will reduce considerably so I suppose I'll be looking for income as well as growth. We will (I hope) move out of this area (NW) and perhaps relocate further South or even abroad. The last 2 years we have had some expensive holidays (and enjoyed every minute of them) but I realise we should perhaps not be throwing so much money around at this stage of our lives . How did I get to be this old - it seems to have happened practically overnight?

Think long and hard about your relocation plans, esp as the prices rise as you move further south. Unless of course you are downsizing substantially.

I would wait til your 18 yr old has finished UNI to rethink. I have twins starting next Sept and it will be costing me a fortune per year.

xylophone

I have twins starting next Sept and it will be costing me a fortune per year.

You said it, kid!:eek:

xylophone

My income is derisory compared to his.

Do you/will you pay tax at a lower rate - worth bearing in mind when you save/invest?
http://www.hmrc.gov.uk/tdsi/ten-per-cent-guidance.htm - (the figures in the examples have not been updated). No mention is made of the changes to be made to age allowance. http://www.moorestephens.co.uk/Too_young_for_age-related_personal_allowances.aspx
http://www.hmrc.gov.uk/individuals/savings-income.htm

gkerr4

innovate wrote: »

You won't get an awful lot of property in the UK for £100k, and probably a lot more hassle than it's worth for the potential rental income.

You don't say whether you already have good pension provisions - assuming you could do with some extra income (who doesn't), I might look into a SIPP if I were you. The benefits of a SIPP includes that you get a nice lot of tax relief - - but there are limits as to how much you can contribute each year, and therefore how much tax relief you get. You can get free information from the pension advisory service - worth exploring your options with them before deciding whether you want to involve an IFA.

Until you know what to do with your money, put it in a good interest payer, making sure you don't have more than £85K in any single financial group.

depends where you live - I could buy 3 or 4 1-bedroom flats for that, or an HMO with about 8-bedrooms and not far off maybe two 3-bed terraced houses. The HM provided greatest income, but has moral issues. The terraces are more my cup of tea at the moment as they can be done-up, gain value and provide income for a few years.

Rollinghome

barginunter wrote: »

Also have £140k in ISA's fixed accounts, easy access accounts etc. Don't want huge risk as retirement looms in 2-3 years. I know I should probably seek ind fin advice but I just wondered if anyone had any ideas as to how I can get a good return. Is it worth buying property these days?

Whether you should invest in property depends on how much income you need and how much work you want to do. Do you really want the hassle of being a landlord in your retirement? Where would you buy if you intend moving south?

We recently sold our second home, even though we didn't rent it out, just because of the hassle of the upkeep and maintenance.

See an IFA, see several, but don't underestimate the difficulty of finding one that's both competent and honest. The vast majority of IFAs are former salesmen with only very basic qualifications.

Most of the people on this site who eagerly suggest you pick an IFA using the internet IFA promotion site will themselves never have actually had any dealings with an IFA and those that have will usually have done so because they have very little knowledge of investment.

Justin Modray is a former IFA, an unusually well qualified one who you may have seen on TV or heard on the radio, and has an article on his site "Can I find a good IFA?"

He goes on to say:
"It's sad to say, but I think the most realistic answer is 'with difficulty'.

The trouble is a lot of IFAs are not that clued up on investments. They're generally proficient at tax planning and looking at the big picture, but many resort to expensive funds of funds or rudimentary portfolios made up of popular funds rather than constructing a decent bespoke portfolio to suit your needs.

...I'm sure there are some good IFAs out there who offer excellent value for money advice and service, the trouble is I just don't know of any."

I'd tend to agree. I've had dealings with several IFAs and I regret that I've yet to meet one that I'd trust with my investments. Read the full article at http://candidmoney.com/questions/question584.aspx

So by all means see some IFAs but do some reading first so that you're in a position to judge the value of any advice you get. Be sure you understand the charges the IFA is making, and those of any investments, and the effect they are likely to have on your investments. Read all documents carefully and compare the suggestions and charges of different IFAs.

The risk of equity investments may or may not be suitable for you but be especially wary of products sold as being "low risk". "Low risk" investment products have a habit of being higher risk than they appear and very high cost. Google for 'Arch Cru' for an example.

You could start by reading more articles on the Candidmoney site and with a reliable book for beginners such as 'Save and Invest' published by Which? or the Financial Times 'Investing' by Prof Glen Arnold. Good luck.

POPPYOSCAR

I would love to know out of all the posters who have commented about property rental being so fraught with problems actually have/have had experience of this themselves?

Seems to work fine for a lot of people including myself.

Rollinghome

POPPYOSCAR wrote: »

I would love to know out of all the posters who have commented about property rental being so fraught with problems actually have/have had experience of this themselves?

Seems to work fine for a lot of people including myself.

I imagine it depends on what you're comparing it with. I've never rented out property, or anything else, and have never needed to.

Some people will need to enhance their income in retirement and may be prepared to make the greater effort involved compared with just receiving a statement for the interest or dividends they've received.

My in-laws rented out a house in London and it went well enough most of the time apart from the tenants they later found out were rolling home drunk every night and set fire to the house. Not long into retirement the husband died and the responsiblity fell to his wife who herself then suffered an illness that impaired her cognitive ability. Fortunately, she was helped to sell the house but had a very fraught time.

It's sensible to assume that most of us will find things that were easy enough when young can become more difficult and worrying when we're older.

So it's really for everyone to decide whether it's something they should consider, whether they will be able to manage both now and in the future, and whether the return will be worthwhile.