How would you invest 1 million pounds

saintlysimon

Hello

New to the site - just wanted to say thanks for all the wonderful info.

A close relative of mine has just come into quite a sum of money, and will have approx £1,000,000 of "free cash".

She is thinking that this money will last her a long time, and has spoken to a couple of financial advisers on how to get the best out of this money.

Ideally she would like a decent return monthly, with very low risk, and for her money to be secure.

I have advised her that property is a very safe bet, but her financial adviser doesn't seem to agree.

What do you folks think?

How would you invest a million quid today?

And what sort of returns would you expect, and what sort of risk?

Thank you

innovate

saintlysimon wrote: »

.... has spoken to a couple of financial advisers

As long as they are independent, that is 100% the right thing to do. Random investment suggestion from anonymous users on an Internet forum that she doesn't even frequent herself are most likely not a good idea. We know absolutely nothing about the lady - things such as how old she is, what financial commitments and arrangements she has, and what her risk profile is are all critically important for any half-decent suggestions.

She needs a proper IFA unless she is investment-savvy herself.

saintlysimon wrote: »

.I have advised her that property is a very safe bet, but her financial adviser doesn't seem to agree.

Are you going to underwrite that advice, with guarantees if things go wrong? Why do you think all eggs in the same basket is a sound idea? Has she actually chosen a financial advisor already?

dunstonh

I have advised her that property is a very safe bet, but her financial adviser doesn't seem to agree.

Its not a very safe bet. It is an asset of varying value and provides an income that can have void periods and an asset that needs periodic expenditure, often at unknown amounts. It can be a viable option in an overall spread but it certainly is not safe as you suggest. It may have seen its day for a while unless you are an experienced landlord who can spot opportunities or a builder or good at DIY and can take on projects.

How would you invest a million quid today?

Depends on the objectives, age, current and future requirements. Typically in a spread to match the risk profile and not going too heavy in any one option.

And what sort of returns would you expect, and what sort of risk?

You cant jump to that as you havent nailed down risk profile, understanding and capacity for loss yet.

Macca83_2

saintlysimon wrote: »

Hello

New to the site - just wanted to say thanks for all the wonderful info.

A close relative of mine has just come into quite a sum of money, and will have approx £1,000,000 of "free cash".

She is thinking that this money will last her a long time, and has spoken to a couple of financial advisers on how to get the best out of this money.

Ideally she would like a decent return monthly, with very low risk, and for her money to be secure.

I have advised her that property is a very safe bet, but her financial adviser doesn't seem to agree.

What do you folks think?

How would you invest a million quid today?

And what sort of returns would you expect, and what sort of risk?

Thank you

let me pass on my bank details... I have a wonderful investment opportunity... :-P

saintlysimon

innovate wrote: »

As long as they are independent, that is 100% the right thing to do. Random investment suggestion from anonymous users on an Internet forum that she doesn't even frequent herself are most likely not a good idea. We know absolutely nothing about the lady - things such as how old she is, what financial commitments and arrangements she has, and what her risk profile is are all critically important for any half-decent suggestions.

She needs a proper IFA unless she is investment-savvy herself.


Are you going to underwrite that advice, with guarantees if things go wrong? Why do you think all eggs in the same basket is a sound idea? Has she actually chosen a financial advisor already?

Thank you very much for your helpful advice.

saintlysimon

dunstonh wrote: »

Its not a very safe bet. It is an asset of varying value and provides an income that can have void periods and an asset that needs periodic expenditure, often at unknown amounts. It can be a viable option in an overall spread but it certainly is not safe as you suggest. It may have seen its day for a while unless you are an experienced landlord who can spot opportunities or a builder or good at DIY and can take on projects.



Depends on the objectives, age, current and future requirements. Typically in a spread to match the risk profile and not going too heavy in any one option.



You cant jump to that as you havent nailed down risk profile, understanding and capacity for loss yet.

Thank you - I appreciate the time it took you to advise me there.

Interesting take on property - I thought buying 10 houses at 100k in the right area, maybe offering some modest improvements, increase value a little, should see a nice monthly rental. Maybe have a local company manage those properties.

I take on board what you saying, especially about spreading the investments around.

Thanks again

JohnRo

http://uncyclopedia.wikia.com/wiki/Buy-to-let

Thrugelmir

saintlysimon wrote: »

Interesting take on property - I thought buying 10 houses at 100k in the right area, maybe offering some modest improvements, increase value a little, should see a nice monthly rental. Maybe have a local company manage those properties.

Doesn't meet this requirement.

with very low risk

Take advice.

atush

buying 10 100K properties would be one of the riskiest things to do. First of all, no cash for renovations, void periods, council taxes etc.

Buying one, as part of a diversified overall portfolio might be OK. But it won't be carefree or easy even if you have it managed (and pay them 10-25% of your rental income).

First, she Needs an IFA (not an FA esp from her bank). She can find one from recommendations from friends or family and if none can be found, contact several from unbiased.co.uk and have her choose one she feels comfortable with, who will take the time to explain things to her properly.

She probably needs to keep clear of structured products (which pay a high comission), and from keeping 100% of it in cash (except for temporarily).

She needs to keep some aside for upgrading her life from her car to her property to a holiday etc.

[Deleted User]

I'd buy a curiosity...

jimjames

Thrugelmir wrote: »

Doesn't meet this requirement.



Take advice.

Interesting yet again on different perceptions of risk and less risk thought to exist in things you can see & understand yourself.

If you really want low risk then a balance of different asset classes makes sense. All your eggs in one basket is just asking for trouble as you'd have no diversity or spare cash for income and you can't put a house inside an ISA for example.