Investing a sum of £2m for the future for a novice

bigadaj

Chantellesquandry wrote: »

Just to clarify I really have no intention of investing any money myself at all or being a trustee - that wouldn't be wise with my totally non existent knowledge but I am trying to get some input and thoughts on what might be possible.

Pincher - you can find the 'Nigerian' report from which the quote was directly taken on the Jersey Financial Services Commission report issued on 5th October - I'm not able to post links so jerseyfsc . org / pdf / Mystery-Shopping-Research-October-2015.pdf Its on page 22. I'm not sure what globe you're looking at but you might find this link useful: google .com / maps.

There's no need to be a trustee or an expert but learning a little about investing and finance will keep you better informed and allow you to ask pertinent questions and understand what an adviser might be proposing, as well as having a better chance of spotting a bad one. Smarter investing is a usefu, read and look on the monevator website, also speak to a few advisers and get a feel for them, then come back here is you have any questions after your initial meetings.

grey_gym_sock

don't spend too long trying to figure out what Pincher means - he likes posting a tangentially-related stream-of-consciousness

redux

Chantellesquandry wrote: »

This is a genuine request - I am trying to do the best for my disabled child because one day I won't be here to support him and I am genuinely concerned about making a good investment for him so he will be well cared for in his old age.

That's the sort of thing I assumed from the start.

Why some people have alleged spam, I don't know. They might become rather better at spotting it if they copied one or two distinctive phrases or sentences in a suspect post then did an internet search with those enclosed in inverted commas. I did just that and reported something here a few days ago. There are no such copies of your post.

But back to the subject:

In the UK the Court of Protection is involved in some types of case like this. I don't know if this is for all cases, or what categories, or how much this is optional, or whether they offer different levels of operation and supervision.

A family member used to administer something on behalf of another, so that's why I heard a little about it. But there it was more or less keep the paperwork, and the fund selection decisions had been made earlier, though I think one fund was changed, and I'm not sure if this was by the Court itself or an appointed intermediary/adviser.

You might read something about the Court of Protection, though I note you said you are offshore. Perhaps there will be a similar body in your territory that can give useful starting advice and/or help you on a continuing basis.

Pincher

grey_gym_sock wrote: »

don't spend too long trying to figure out what Pincher means - he likes posting a tangentially-related stream-of-consciousness

I volunteered for the Mars mission, so I can save on living expenses. Floating in space gives you plenty of time to drift in your own thoughts.

I was trying to explain the need for separation of trustee and investment manager. Combining the two in one firm is just asking for abuse. For continuity of trusteeship, it is better to have a group of like minded people with similar objectives, i.e. care for their loved ones, being replenished by fresh blood across generations.

Does that make more sense?

Aegis

Chantellesquandry wrote: »

Just to clarify I really have no intention of investing any money myself at all or being a trustee - that wouldn't be wise with my totally non existent knowledge but I am trying to get some input and thoughts on what might be possible.

You should almost certainly be a trustee in this instance, as doing so will maintain an external opinion for the management of the trust assets. Any adviser or solicitor involved will then need to convince you that they are recommending the right thing, which is a great way of ensuring independent oversight of the decisions.

You really do need to find a respected investment adviser for this case if you are a relative novice, possibly by asking through a trusted solicitor. Not all advisers are bad, with many in fact doing excellent jobs even in these more complex areas of financial planning. Ideally you need to find one that will demonstrate a very good sustainability analysis for this type of investment assignment, including a demonstration of what happens if markets fall suddenly and sharply at a given point in future.

If you don't already have a good solicitor, that's a good first step, especially if they have experience of finding investment advisers for their clients. Given the purpose and the amounts involved, you might wish to consider a full member of the Society of Trust and Estate Practitioners - these often identify themselves with TEP after their name. This shows a commitment to this particular specialism, which would be very reassuring for you and any other trustees that might be appointed.

macman

You say you live 'offshore'. Jersey, Isle of Man? Without knowing where this investment will be taxed, I don't see how anyone can give you meaningful advice.

eskbanker

macman wrote: »

You say you live 'offshore'. Jersey, Isle of Man? Without knowing where this investment will be taxed, I don't see how anyone can give you meaningful advice.

OP has made several references to Jersey in previous posts....

macman

But has not directly confirmed they live in Jersey or where they intend to invest this amount.

Linton

Silian wrote: »

Hi,


Firstly pick up a copy of Smarter Investin by Tim Hale.

It will give you the basics that you will need when you speak to an IFA. With that amount of money you do want an IFA but you also need to know enough to ensure that you get the right IFA.

Good luck!

Such books will give you a basic view of investment. However your requirements are different to those that Tim Hales and others aim to address. The real concern in your circumstances it seems to me is not get get the maximum return over an extended period, but more to ensure a reasonable absolutely guaranteed steady income that will last a lifetime. Presumably what happens to any remaining money beyond that time is of little concern. So the solutions presented in the "dummies guides" may well not be appropriate.

Here are some aspects that have occurred to me. Though I guess these are already part of your considerations.

- is it 40 years? Who knows what life expectancy will be after 40 years of medical advances.

- inflation. This is your real enemy. In the past 40 years UK prices have risen 7 fold. Wages have risen perhaps 10-fold. Who knows what will happen in the next 40 years.

- continuity. In 40 years you and your chosen financial advisers may not be around. The type of investments that you would have chosen 40 years ago may be very different to those you would chose now. Somebody needs to ensure the investment approach is modified as the world changes. Does this need to be a corporate somebody for continuity? This could be expensive.

N1AK

Chantellesquandry wrote: »

I need to understand the options for investing £2m for the future living costs. The sum is to cover the care and living costs of a person from now for the next 40 years.

Is it even possible to invest £2m and live off this for 40 years? We live offshore if that helps.

It is very easy to live off £2 million for life and have more left than you started with if you could live on the equivalent of someone earning £50k pa from work, which is £36k after tax and NI. There is a good chance that £70k pa could be used without the money running out in 40 years.

I'll echo others in suggesting professional advice. If you're paying up front then the IFA should have no motivation to steer you wrong, and will be able to better understand the situation than anyone on a forum will.