30K Investment advice

Parker25

Both my partner and I have recently come into some money (£30k) and we have no idea what to do with it.

We have no debt and we are looking to use the money as a deposit for a house however we would like the money to work a little for us first.

Im assuming the answer is going to be to put the funds into a cash isa before 5th April however I wondered if there were any alternative ideas? I am aware of the help to buy isa however I figured if we made use of the tax free allowance for this year we can look at that in the Autumn when/if its rolled out.

Any help will be greatly appreciated.

jimjames

Parker25 wrote: »

Im assuming the answer is going to be to put the funds into a cash isa before 5th April however I wondered if there were any alternative ideas?

If you read the forums you'll find that the answer is almost certainly not "use a cash ISA" if you want to make the money work for you.

Clue - check the threads about current accounts.

Parker25

Ah ok ill have a look. Thank you for the advice. My reasoning was based on the fact that all I hear is to make use of the cash isa each year for savings.

Thrugelmir

If the money is earmarked for a property deposit. How much are prepared to risk and possibly lose? Cash maybe boring but it's safe.

GiveMeABreak

Cash ISA's are nice but don't generate much money on the grand scheme of things. I would suggest putting into a stocks and shares ISA before April 5th for sure.

If you want to be safe I would suggest a fund tracker. With £30k on the table you really need to be speaking with professionals. It's a lot of money to invest without seeking some expert advice which is tailored towards your individual circumstances.

Age?
Financial status?
home owner?
Pension?
Salaries?
Kids?

Etc. I would suggest speaking with a professional investment company as soon as possible and try to get your money into an ISA before April 5th but not a cash ISA, go with a stocks and shares ISA.

Best of luck

bowlhead99

GiveMeABreak wrote: »

Cash ISA's are nice but don't generate much money on the grand scheme of things.

Agreed, you'll get 3%-4% a year by using the high interest current accounts, while instant access ISAs pay rather less.

For example, the Santander Direct ISA pays 1.5% but only if you have their 123 current account to qualify for the better-than-normal rate. If you do have the 123 current account to qualify, you'll realise that you can just leave the money in the current account and get paid 3% gross on it up to £20,000. Between a person and their partner they can have two sole accounts and a joint account and be earning 3% on up to £60000 without even looking at the other banks that pay 4% or 5% on smaller amounts of money. If your tax rate is below 50% it is better to earn 3% interest and pay the tax, instead of just getting 1.5% interest without tax in the ISA product.

I would suggest putting into a stocks and shares ISA before April 5th for sure.

When they plan to use the inheritance to buy a house in the not-to-distant future, you think they should invest it in the stock market? That seems a bad idea unless they are gamblers.

If you want to be safe I would suggest a fund tracker.

Yes, tracker funds typically don't gain or lose more than 40-50% of your money in any one year period so that's great advice to preserve the capital to buy a house deposit. Oh, hold on, that sounds stupid.

With £30k on the table you really need to be speaking with professionals. It's a lot of money to invest without seeking some expert advice which is tailored towards your individual circumstances.

Professionals charge money for their services. There is no point engaging a professional who will charge perhaps several hundred pounds an hour when you only have £30k and the advice from them is going to be not to make any investments if you have a 1-5 year timescale.



To the OP: put the money in the highest paying interest-bearing accounts you can find, which at the moment are all current accounts. Then, as you suggested, each open a help-to-buy ISA once available - they will only take £200 a month each and the interest paid by the banks might not be very high BUT the free money from the government is what will make them better than other savings options.

Etc. I would suggest speaking with a professional investment company as soon as possible and try to get your money into an ISA before April 5th but not a cash ISA, go with a stocks and shares ISA.

Don't do that.

However if you have just come into some extra money and will not need every penny of it for the house deposit, it is very sensible to consider whether you both have suitable retirement provision - i.e. pension which comes with a decent tax break and sometimes free money from your employer if you are not already contributing enough to get the most that the employer is willing to pay. If you haven't, it might be worth using part of the windfall to help with the affordability of making pension contributions while you save up the rest of the deposit.

Parker25

Thank you for the really comprehensive response. I was quite apprehensive about asking questions on these forums but am more than happy I did.

Cheers everyone.