Inherited money any advice on how to use it wisely welcome...

countrygirl27

Hi

Im fairly good at saving, OH not so! I saved entire deposit for our house. We would have more saved except we are rennovating our house as we go, so last 18 months all spare cash goes on rewiring, plastering, a bathroom suite new fencing... I could go on.

I am a customer of Lloyds so would be interested in the TSB offers.

I suppose our ultimate aim would be for in 5 years time or so one or both of us to be able to work part time, or to have a change of career and not have to worry too much about the financial implications.

Thanks for all the suggestions so far. I prbably am the sort of person who would panic if the shares fell low, and convince myself it was a stupid idea and that I should take out what I still had left!!!!

Archi_Bald

countrygirl27 wrote: »

I am a customer of Lloyds so would be interested in the TSB offers.

You are probably not aware that TSB Bank is now wholly separate from Lloyds Bank, although both are currently owned by Lloyds Group (as are Halifax and BoS).

It should not be a given to stick with the offers of a single bank since none of them has all the best offers. Lloyds have a great current account and Monthly Saver with the Club Lloyds, but it wouldn't take all your £17K savings, whilst a combination of TSB / BoS / Santander 123 would. Wihtout knowing what interest you get on your savings, I would hazard a guess and say this combination would give you a lot better interest than you currently get.

So to be brutal I would say you are not fairly good at saving - the likelihood that your savings have been losing money to inflation is actually quite high.

countrygirl27

Yes the money is currently earning a pitiful amount of interest in an easy saver which is why I want some advice. Ive only put it there because I happened to have one anyway and I didnt want to leave a large balance in my current account.

Ill look into the various accounts I had already clocked the Santander account.

kidmugsy

countrygirl27 wrote: »

I'm going to see a mortgage advisor on Saturday, who is applying for a 70% ltv mortgage for us which seems to be the threshold at which there is a major benefit in interest rates.

Fair enough: there have been times, or perhaps providers, where the cut-off for best rates has been 65% and even 60%.

P.S. On using current accounts as savings accounts, see also Nationwide FlexDirect.

atush

Your OH isn't good at saving you say, and only has a state pension. He should join his work pension, or consider a personal pension if Self employed.

He will have a personal tax allowance at retirement just as you will but wont be using his so should start saving this way. A DD every month just after payday. This way he won't notice it going out each month so much.

then as everyone says, a cash emergency fund plus cash savings for spending in the next 5 years. Then I would look to use some of the upcoming 35K in your S&S isa allowance. This would be long term savings to either retire early, produce a small income to help part time working, and could be used to reduce or help pay off your mtg later on.

As for the field, I would only consider one if it was very close to if not adjoining your house as if too far away you wont' be able to go there twice per day to take care of the pony. Plus you will have costs of a shelter on the land for the pony. This all adds up. So the land would have to be very cheap. If there is a farm adjoining your property, then renting a field could work out better.

countrygirl27

The field idea appeals because I will want to (in a perfect world) buy another horse in a few years time. This could potentially double the current cost I have which is £25 pw to use a field. (This may sound a lot but believe me its a bargain in comparison with what you could spend.)
My idea was that if I bought a field I would be in a position to buy one outright and to svae myself £100 pm instantly and potentially £200 pm if I bought another horse. Also I could offer shared rent of the field to someone else and potentially make £100 pm on top of that.

The thing about pensions and tax allowances I dont understand. OH has recently joined a workplace pension (Scottish Widows?) literally a couple of months ago. He decided to do this before it was compulsory. Is my understanding of this correct?

ruinen

countrygirl27 wrote: »

The field idea appeals because I will want to (in a perfect world) buy another horse in a few years time. This could potentially double the current cost I have which is £25 pw to use a field. (This may sound a lot but believe me its a bargain in comparison with what you could spend.)
My idea was that if I bought a field I would be in a position to buy one outright and to svae myself £100 pm instantly and potentially £200 pm if I bought another horse. Also I could offer shared rent of the field to someone else and potentially make £100 pm on top of that.

I guess the economics of buying a field depends on the purchase price. If you have to spend £200,000 to save £200pm then it might not be a good deal. Do you know what a field costs?

ruinen

ruinen wrote: »

I guess the economics of buying a field depends on the purchase price. If you have to spend £200,000 to save £200pm then it might not be a good deal. Do you know what a field costs?

Obviously depends where you live, but just seen fields for sale at around £35,000. Seems a reasonable thing to investigate to save £2400pa cost. If you can get another £100/pm income then the sums look even better.

countrygirl27

Yes I think you can pay anything between 10-15/20k per acre. The thing is there are plenty of other people around like me so I'd imagine that when these things come up the price gets pushed up.

It seems to me that the advantage would be:
A) I'd pay a lot less for my hobby and be able to expand it without the prices skyrocketing
I'd have put my money into land which tends to maintain its value
C) if I lost my job, or something similar happened, I wouldn't have to be at panic stations to quickly because the use of it would be costing me nothing
D) I could perhaps make a little on it by offering use of it to others
E) as mentioned land is popular so I'd imagine I wouldn't have much trouble selling it
F) if I kept it a long time, then as I approached retirement age for example, and got to old to clamber into the saddle, I could sell it releasing that capital for other things.

However, the spanner in the works is there's nothing for sale locally currently!

kidmugsy

A friend of mine bought a field for his daughter's horse. He's since referred to it as "my pension plan" since in his pipe dream he'll get planning permission.