Investing a lump sum to generate an income

johnnyredgate

holly_hobby wrote: »

Your tenants should be on an AST (6/12 mth renewable tenancy agreement) - I am puzzled as to how they have apparently ended up with what appears to be a lifetime tenancy "they have been there for many years and now have a young family too" ??

It should now be on a periodic tenancy, it is with a letting agents. I was just trying to make the point that the house has very much become the tenants home now, although obviously notice could be given, morally doesn't feel so good, and as said I will ask them whether they are interested in buying once the house buying support scheme is on offer. I don't really feel confident of the house selling in the current market, also there would be quite a lot of work involved in preparing it for sale which I would struggle with, although at the end of the day I could just put it to auction.

I have met with a financial adviser although his suggestions for investing would likely only yield some 3% at best, and less secure than savings, although these days I am not so sure about that, hence the reason that I looked at other options such as the student pods etc which on the face of it look fairly secure and generate reasonable incomes.

accesspwd1

If you do decide to lend through Zopa, the amount your lending will require you to pay for a consumer credit licence that will cost in excess of £1000

I invest with Zopa, and my credit licence was money well spent.

But you also have to consider the tax complications you will encounter through Zopa, especially if your in poor health

johnnyredgate

rochja wrote: »

Investing in things like hotel rooms can give you side benefits in addition to the standard return such as cheap/ free breaks. You could also inject variety into life by setting up one of your btl as a well equipped holiday home and instead of letting it swap it for breaks for yourself through something like https://www.airbnb.co.uk/ or similar. The intangible benefits can make an investment with a low apparent return much more worthwhile

Most people seem to be cautioning against investing in hotel rooms, it was something that I had planned to do as it can be done with a relatively small capital sum. Unfortunately since the onset of my health problems traveling would now be a significant struggle for me, and I would likely suffer severe exhaustion during a holiday, so whilst the holiday side of it would have appealed prior to becoming ill realistically it would now be quite difficult for me. I try and do things from home, with days out etc for a break.

Will take a look at Zopa, although really want to be as hands off as I can with the investments.

johnnyredgate

accesspwd1 wrote: »

If you do decide to lend through Zopa, the amount your lending will require you to pay for a consumer credit licence that will cost in excess of £1000

I invest with Zopa, and my credit licence was money well spent.

But you also have to consider the tax complications you will encounter through Zopa, especially if your in poor health

Thanks Zopa, thats helpful to know, what sort of sum do you lend through Zopa if you don't mind me asking? Yes it would need to be something that was fairly easy for me to keep track off and do tax returns for etc.

bigadaj

johnnyredgate wrote: »

Thanks Zopa, thats helpful to know, what sort of sum do you lend through Zopa if you don't mind me asking? Yes it would need to be something that was fairly easy for me to keep track off and do tax returns for etc.

You can do this with relatively low sums, and the loans are generally split to try and diversify and reduce risk.

There is, however, no protection so you could in theory lose your money; in practice a small percentage is normally lost to defaults which needs to be factored into the income you receive.

atush

Zopa would be OK for a smal amt of your cash, but I don't see it as a home for the whole. You could lose it all, and wouyld have to spend 1000 gut getting the credit license. That is a mugs game to me.

A basket of the income funds/ITs mentioned by myself and others above, can give you an income (conservatively) of 4-6%. Not the 3% you mentioned.

FLAPJACK

Hi Johnny,

Thanks for the reply, I had a stroke and was "retired" under ill health pretty smartish...I didn't even apply for it....infact I didn't know such a "retirement" exsisted to be honest.

Luckily I was out of the door about a year before Capita came on the scene.

You have my sympathies in having a "computer says no" decision already made.....I wish you the very best for the future.

johnnyredgate

Thanks for the reply flapjack, sounds like you were lucky with the illhealth retirement, but with a clear diagnosis it is much easier. Not so lucky with having the stroke though, I am sorry to hear about that and hope that you are managing ok and staying well.
It has been a stressful process for me, I have been told by a private GP that I have obvious neurological damage which has really affected how much information I can manage to cope with, also left me with a severe problem maintaining sleep, hence completely exhausted as well most of the time along with unpleasant head sensations and noise. Oh well, time to try and move on positively from the last few very difficult years now.
ps I am Mrs JR - highjacking OH's account.

jimjames

johnnyredgate wrote: »

I have met with a financial adviser although his suggestions for investing would likely only yield some 3% at best, and less secure than savings, although these days I am not so sure about that, hence the reason that I looked at other options such as the student pods etc which on the face of it look fairly secure and generate reasonable incomes.

You may want to reconsider your views on risk.

Personally I would rate anything that is not FSA authorised as very high risk and things like pods, storage or hotel rooms are a completely different option to using equity income funds.

You may get a higher income from pods or other such items but it isn't much use if it is at the expense of your capital. Capital in shares will vary day by day but long term a balanced portfolio should perform better than cash and if needed can be cashed in at any time.

I don't think you can say the same for pods or storage, getting your money back on demand could be problematic and there is a huge risk over their long term viability in my view.

Also bear in mind that if share prices increase the 3% will actually be a higher amount compared to your original capital. So 3% on £10k will give £300 income, if the fund value increases to £20k then 3% is now £600 income which is actually 6% return on your original capital.

50Twuncle

johnnyredgate wrote: »

Thanks for the reply flapjack, sounds like you were lucky with the illhealth retirement, but with a clear diagnosis it is much easier. Not so lucky with having the stroke though, I am sorry to hear about that and hope that you are managing ok and staying well.
It has been a stressful process for me, I have been told by a private GP that I have obvious neurological damage which has really affected how much information I can manage to cope with, also left me with a severe problem maintaining sleep, hence completely exhausted as well most of the time along with unpleasant head sensations and noise. Oh well, time to try and move on positively from the last few very difficult years now.
ps I am Mrs JR - highjacking OH's account.

Are you / were you, in a trades union ?
I recommend also that you ask your MP for help - that's what I did and wrangled ill health retirement on top of redundancy (I had almost 30 years service under my belt) - I haven't looked back since !!