£22,500 to invest - ideas please?

ausidadian

Let me just start by saying I am a total money novice. We recently came into some money and after having paid off our debts we now have £26,500 to invest. My original plan was to just bung it on our mortgage - however there is a £1,500 fee for lump sum payments until next October - which I'd rather avoid.

At the moment £4,000 is spread over two Intelligent Finance ISAs which we've had for ages and take us up to our limit - and the remaining dosh is just sat in our current account (shock horror I know).

I've spent the last two days researching options and I am now thoroughly confused. Not sure whether I should pay the fee and pay towards the mortgage, put the money in a fixed term bond til next year and then pay towards the mortgage, put it in a high interest savings account??? I'm open to investment options as opposed to straight savings but as i know very little am just getting myself even more confused when I start looking at them!

Any advice thoroughly welcomed

Jonbvn

Get it out of your current a/c NOW!

I agree that it is pointless incurring ERC on your mortgage.

I am confused by the 4k in your ISA's. You are allowed 3k per person per tax year. Assuming you are referring to yourself and your O/H, you can max-out to 6k this year.

After maxing out your ISA's, IMHO, I would look at index linked saving certs, which are tax-free. They are good ATM, since the RPI is high. You can save 15k per issue. Minimum term is 1 year (to get any interest).

The rest, I would put into a high interest account.

Given your declared confusion with stocks & shares, I would avoid them for the time being. Perhaps, if you become more confident, you can consider them later.

discobaby

ausidadian wrote: »

Let me just start by saying I am a total money novice. We recently came into some money and after having paid off our debts we now have £26,500 to invest. My original plan was to just bung it on our mortgage - however there is a £1,500 fee for lump sum payments until next October - which I'd rather avoid.

At the moment £4,000 is spread over two Intelligent Finance ISAs which we've had for ages and take us up to our limit - and the remaining dosh is just sat in our current account (shock horror I know).

I've spent the last two days researching options and I am now thoroughly confused. Not sure whether I should pay the fee and pay towards the mortgage, put the money in a fixed term bond til next year and then pay towards the mortgage, put it in a high interest savings account??? I'm open to investment options as opposed to straight savings but as i know very little am just getting myself even more confused when I start looking at them!

Any advice thoroughly welcomed

yOU COULD ALWAYS INVEST IT IN ME;)

CLAPTON

if there is a penalty of 1500 until next October then there is no point of paying in a lump sum on the mortgage.

unfortunately next ocober is an ambiguous term and can mean Oct 007 or Oct 08 but in any case i would ensure that the money is readily available at that time so you can assess the situation then.

so i would max out the ISAs and put the rest in an easy access high interest rate savings account (icesave?) until the mortgage tie in period ends and then see what the situation is then.

ausidadian

.Thanks for ideas - the tie in period finishes in October 2008 - and the reason we've got £4k in ISAs is because there was already £2k from earlier savings - so we're now at our £6k limit with £22.5k still left to invest.

Will investigate the index linked saving certs. Can I take it from what you've suggested that bonds aren't such a great idea?

thanks again