What to do with approx £50,000 savings?

manutdsc

Hi, I'm 22, and by my 23rd birthday I estimate I will have saved £50,000 (or thereabouts), through a mixture of blood, sweat and tears and not spending anything! What is the best thing to do with this money to make it grow? I'm quite a risk-averse individual, just to point out

Al.

Think about outcomes; what are your life goals? You say you're risk averse but how much of that is enforcement bias based on what you've done? Think about the best way to fund retirement, think about your home (if you don't already have one), make sure you're properly insured. It'd be a crying shame if you had an accident and spent that all in care and rehab.

Eco_Miser

Take a look at all the other threads with titles like "What to do with £xx,000".
In particular, make sure your cash is earning at least 3% AER, preferably 6%, which means spreading it around the best paying current and regular saver accounts.

Then look at the suggestions for riskier and more profitable investments, here and on http://monevator.com/ and decide what level of risk you can accept for a sufficient reward.
Remember risk is more about volatility (ie the price going down and up) than about the chance of losing everything (with sensible investing that's effectively impossible, and if it did happen, everyone would be in the same boat).

Pincher

Go travelling.

It looks like we are going though a rocky patch economically.

Oil price plunging means there are great travel deals around.

Sterling is high historically, so you get more bang per buck.

Put the money somewhere safe, spend £10k+ on travelling.
Come back when the recession has bottomed out, and invest then.

Travelling is much better when you are young and active.
When you turn 50, you'll wish you did. Cheaper Travel insurance when you are young too.

This is based on the assumption that if you jump in now, you'll lose £10k before it starts recovering, so might as well enjoy the £10k.

You need to have a model of how events will evolve, and place your bets accordingly. Each way bets on all outcomes is no bet at all.

I only had £5,000 when I did it in my late 20s. Fond memories.

Alpaca

Have sent you some more detailed thoughts in a PM.

p2p lending would be a strong recommendation ... it hits a nice sweet spot between risk and returns. On both of those factors it sits in between cash savings and shares.

I think there are a number of reasons why now is actually a good time to do some p2p lending, not least that it's coming up for ISA eligibility in April next year at which point I expect rates will drop as a massive wall of ISA money starts flooding out of low rate paying cash ISAs towards p2p. So good to lock in some decent rates now while they last.

colsten

OP, please do not act on unsolicited PM from a newbie on this forum, especially not from someone who urges you to buy now rather than later.

Alpaca reported.

Stevie_Palimo

Alpaca wrote: »

Have sent you some more detailed thoughts in a PM.

p2p lending would be a strong recommendation ... it hits a nice sweet spot between risk and returns. On both of those factors it sits in between cash savings and shares.

I think there are a number of reasons why now is actually a good time to do some p2p lending, not least that it's coming up for ISA eligibility in April next year at which point I expect rates will drop as a massive wall of ISA money starts flooding out of low rate paying cash ISAs towards p2p. So good to lock in some decent rates now while they last.

Don't be offering advice to people as some may take it seriously and you cannot possibly steer someone in the right direction of making there money grow, You are no finance whizz and if you were there would be no need to tout for business on a forum.

manutdsc

colsten wrote: »

OP, please do not act on unsolicited PM from a newbie on this forum, especially not from someone who urges you to buy now rather than later.

Alpaca reported.

Thank you for your concern, but I actually find this person's advice really useful, no need to report! x

jimjames

manutdsc wrote: »

Thank you for your concern, but I actually find this person's advice really useful, no need to report! x

If the advice is so useful, why are they not prepared to share it on an open forum? It always rings alarm bells if the offer is so good that it needs to be sent by PM.

Stevie_Palimo

jimjames wrote: »

If the advice is so useful, why are they not prepared to share it on an open forum? It always rings alarm bells if the offer is so good that it needs to be sent by PM.

And then come back in several months complaining that they have been robbed of all there money.

kangoora

Of course Alpaca and manutdsc could be the same person trolling for business