£400K What is realistic Income?

Glen_Clark

I am sure we can safely ignore any possibility of deflation in Britain.
In financial matters, its the only thing I am certain of.

grey_gym_sock

i don't expect deflation, but i wouldn't like to bet against it. so for instance, i wouldn't like to take out a fixed-rate 25-year mortgage (if they exist), and probably not even 10 years.

gadgetmind

It all depends on how HMG/BoE decide to control inflation when it hits.

If they raise interest rates, then all those people flying mortgage forbearance kites will come crashing to earth, and the banks will have to realise their loses.

Instead they will probably reduce M4 by selling the BoE's gilts back to the market.

I'd prefer that they do the latter and think it's the most likely. approach.

rpc

paul5046 wrote: »

iNFLATION IS NOT A RISK, ITS A FACT, SO WHY DO PEOPLE LABEL IT AS SUCH

If inflation is a fact, not a risk, please tell me the RPI and CPI inflation figures for each of the next 20 years so I can plan my investments better.

By the way, your caps lock seems to be stuck.

grey_gym_sock

rpc wrote: »

By the way, your caps lock seems to be stuck.

no, his letters were inflated. FACT.

Daniel_Elkington

Haven't read the previous posts so I'm sorry if I'm re-iterating anything.

That all depends on your ATR, existing investments, debt etc.

Firstly we clear all debt.

Secondly we look at ATR.

Thirdly we split assets (diversify)

If you are low risk we'll look at 1/3 cash based 1/3 Investments (try to get it all into ISA in 10-15 years) 1/3 direct (buy some good properties or investment trusts etc.)

A decent wealth manager can do this all for you and get the relevent professionals in to deal with it. Most IFA's 'wealth management' package means stick it in a portfolio that the ATR says you fit in with and they'll call it bespoke because they've done the ATR (it is technically tailored to you, although hardly individual).

These ideas are all about what you are comfortable with and how they fit in with your overall goals and agenda. Creation of 'disposable' income is the goal here and simply by reducing outgoings we can do that.

If you want to find an extra £10K a year then simply paying off your mortgage, debt and getting rid of a lot of life cover (as you now have cash yourself to pass on) can go some way towards achieving this, making the income target from your investments much more achievable and reduce the risk you need to take to get the return you need.

If you are uncomfortable with becoming a landlord, we may discuss gilts or bonds and try to buy some direct as there are a few issues which are OK value. Although the poster above that reckons you can get an 8% yield is fairly accurate, however if Barclays bomb then you'd be !!!!!!ed.

This is roughly what our process is anyways, I'm fairly certain there are lots of alternatives.

To be honest you are not going to be short of options with £400,000. Go with an IFA you trust, an IFA that has strategic partnerships with accountants, STEP members, solicitors, architects and surveyors, because with those relationships comes a wealth of experience that no IFA practise can offer itself.

Wealth Management is not about simply buying into a 'wealth managers' panel of investments selected with [insert jargonistic sales pitch here]. It's actually about moving your cash around to get the return you want in a way you are comfortable with. If anyone suggests anything else then disengage them.

and p.s. we love being asked questions - we've spent a lot of time and money getting qualifications and acquiring knowledge and it gives us a chance to show off. So, on the first appointment, prepare and write a list of questions to ask - give us a grilling!

Glen_Clark

gadgetmind wrote: »

It all depends on how HMG/BoE decide to control inflation when it hits.

If they raise interest rates, then all those people flying mortgage forbearance kites will come crashing to earth, and the banks will have to realise their loses.

Instead they will probably reduce M4 by selling the BoE's gilts back to the market.

I'd prefer that they do the latter and think it's the most likely. approach.

As a rule the taxpayer always loses, so the BoE could only sell gilts for less than they bought them. Since that may cause some political embarrassment (because the losses could be easily quantified like Gordon Brown's Gold sale) I don't think its very likely. I think it more likely they will just let inflation take off, they probably couldn't stop it anyway.

Glen_Clark

donkingkong wrote: »

As fact missed by many (of the gen. pop.).

It is and I think a reason for the lack of support for the 'Save Our Savers' campaign. They complain about savers 'losing income' as though the (relatively) wealthy are morally entitled to a safe income for doing nothing and risking nothing. No wonder this doesn't attract many votes. They would do far better to emphasize the real losses made on savings, after tax and inflation.

atush

Most of us out here (certainly me lol) are savers but also borrowers (only mtg for me).

I am losing out big time on my cash savings, but my mtg is less than 1%, and many of my investments are doing well (esp some of my ITs).

I would like more on my savings, but I am very happy with my mtg rate and feel I am making out over all if you balance the 2.

MarcoM

Daniel_Elkington wrote: »

Haven't read the previous posts so I'm sorry if I'm re-iterating anything.

That all depends on your ATR, existing investments, debt etc.

Firstly we clear all debt.

Secondly we look at ATR.

Thirdly we split assets (diversify)

If you are low risk we'll look at 1/3 cash based 1/3 Investments (try to get it all into ISA in 10-15 years) 1/3 direct (buy some good properties or investment trusts etc.)

A decent wealth manager can do this all for you and get the relevent professionals in to deal with it. Most IFA's 'wealth management' package means stick it in a portfolio that the ATR says you fit in with and they'll call it bespoke because they've done the ATR (it is technically tailored to you, although hardly individual).

These ideas are all about what you are comfortable with and how they fit in with your overall goals and agenda. Creation of 'disposable' income is the goal here and simply by reducing outgoings we can do that.

If you want to find an extra £10K a year then simply paying off your mortgage, debt and getting rid of a lot of life cover (as you now have cash yourself to pass on) can go some way towards achieving this, making the income target from your investments much more achievable and reduce the risk you need to take to get the return you need.

If you are uncomfortable with becoming a landlord, we may discuss gilts or bonds and try to buy some direct as there are a few issues which are OK value. Although the poster above that reckons you can get an 8% yield is fairly accurate, however if Barclays bomb then you'd be !!!!!!ed.

This is roughly what our process is anyways, I'm fairly certain there are lots of alternatives.

To be honest you are not going to be short of options with £400,000. Go with an IFA you trust, an IFA that has strategic partnerships with accountants, STEP members, solicitors, architects and surveyors, because with those relationships comes a wealth of experience that no IFA practise can offer itself.

Wealth Management is not about simply buying into a 'wealth managers' panel of investments selected with [insert jargonistic sales pitch here]. It's actually about moving your cash around to get the return you want in a way you are comfortable with. If anyone suggests anything else then disengage them.

and p.s. we love being asked questions - we've spent a lot of time and money getting qualifications and acquiring knowledge and it gives us a chance to show off. So, on the first appointment, prepare and write a list of questions to ask - give us a grilling!

So do wealth managers advise their clients to buy btl properties?
I alwasy thought that IFAs were about other type of investments.