Advice sought on investing my recently-bereaved mother's £100K

bugbyte_2

My mother in law has just gained £50,000. Despite gentle prods to put it into a vanguard life strategy fund (other funds are available but you wouldn't think so the amount of times we mention it!) she insists on leaving it in her 0% current account with accompanying bank book. At the end of the day decision is hers and is what she feels comfortable with.

As you hit the magic £100,000 threshold, you could get a free consultation from HL. May be worth it just to build your own knowledge of what is available.

Another possibility is that her money is invested in dividend paying shares. That may give her sustainably say £4500 per year tax free without too much inroad into the overall value value of her money.

Talking of HL, they have been promoting Threadneedle UK Equity Alpha Income as a good dividend paying fund. The fundamentals certainly look OK but probably to volatile for the situation described here.

jem16

bugbyte wrote: »

As you hit the magic £100,000 threshold, you could get a free consultation from HL. May be worth it just to build your own knowledge of what is available.

All IFAs offer an initial free consultation. Use https://www.unbaised.co.uk to search for one.

bugbyte_2

I mentioned the HL one because I presumed (correctly or incorrectly) that their advisors would advise on funds on their own platform, and would not have any of the associated costs - which I know little about so can't comment - that other independents may have.

xylophone

she insists on leaving it in her 0% current account with accompanying bank book.

On the basis that "owt's better nor nowt" would she not at least consider a cash ISA and a building society account for the balance?

xylophone

As such, I'm just wondering what options might be available above and beyond simple savings accounts and ISAs?

She'd probably want to use these as a start? Assuming that she hasn't already done so, £5640 into a cash isa before 6 April and £5760 after would give an emergency stash - perhaps another £ 5000 into an easy access account.

She could then look at using her stocks and shares isa allowances for this year and next with the likes of HL which has a user friendly web site.

She could use their Vantage account for the balance and transfer over to ISA as the years pass.

She could consider income producing funds - for example Invesco Perpetual Distribution Inc, M&G Global Dividend Inc, Kames Strategic Bond Inc.

Do be sure to check that her income tax situation is correct.
http://www.hmrc.gov.uk/budget-updates/march2012/new-rates-tables.pdf
http://www.hmrc.gov.uk/taxon/bank.htm - check out the information on 10% band if appropriate.
http://www.hmrc.gov.uk/pensioners/paying-retire.htm

bumblebee5

Doraemon72 - I have Power of Attorney (with two others) for my mum who is in a nursing home. After selling her house, and much discussion, it was decided to invest the money in NSandI and their Direct Saver. At the time, it was 2.75%, but obviously lower now. I personally didn't think it was the best option, but I was out voted! It is very easy to manage, ie getting money out when needed (to pay her NH fees) and does earn minimal interest. It might be another option for you. My impression is that people think NSandI (who also do premium bonds) is a lot safer than other places.....

dunstonh

I mentioned the HL one because I presumed (correctly or incorrectly) that their advisors would advise on funds on their own platform, and would not have any of the associated costs - which I know little about so can't comment - that other independents may have.

Dont mix up the DIY platform with an advised service. They are two different things (and cost differently).

Richie(UK)

I know that investment of the funds was the driver behind your post but is tax an issue that requires consideration here also? If it has already been considered then please ignore the rest of the post

You referred to the property as 'their' Spanish villa - does this mean that it was jointly owned? If so, as far as UK Capital Gains Tax is concerned there would be no charge for your late father on his half share (because of his death) but there could be for your mother - it depends upon the original cost of the property, and whether any resulting profit exceeds here CGT annual allowance. Has this been considered? Have you sought advice as to whether any Spanish taxes are payable on the disposal?