Inherited £ 150,000: What now?

DUS

Hello,

I´ve inherited some GBP 150,000 and would be very interested to hear your opinions on what I could or should look into when it comes to investing the money. Obviously, this always depends on my variables including my personal situation including assets already available so please let me start with some basic info:

- I am 47 years old. German national but lived in the UK for 9 years till the end of April.
- I moved to Asia last month living in a rented accommodation.

My financial situation:

- £ 85,000 in a S&S ISA currently 50% in cash, 50% spread across a Gold ETF, Silver ETF, 2 Gold & Mining Funds as well as First State Global Resources fund. I pulled out of my other global shares funds including some EM funds a few months ago as I am extremely bearish and almost paranoid about an upcoming financial crisis of huge proportions within the next 24 months. :eek:

- Cash outside my ISA is roughly £ 20,000

- I also have a German life insurance policy due in 13 years. The guaranteed interest paid in it is 4%. Guaranteed payout at the age of 60 is around £ 50,000.

By moving to Asia I also gave up my job so at least for the time being I have no monthly income/salary. I will look into some income generating opportunities in Thailand but cannot count on it to happen anytime soon.

So, this is by and large my current personal and financial situation.

In the light of my very pessimistic short- to long-term outlook on the world economy and with my general ambition to diversify my "portfolio", my initial idea when I heard about the 150,000 was to buy property in Thailand. But the more I read about it and the more I speak to people on the ground about buying a condo, the less enthusiastic I get about that idea. Seems too risky! Especially when it comes to selling the condo again in the future this seems to be problematic to say the least (people say it will be very difficult to get my initial investment back).

I then thought about buy to let in Germany. However, living in Asia I will have to first check what my options are in Germany re how to manage the property. So this is a potential way to spend the money but not yet sure.

So, with all that said, do you guys have any suggestions for me as to what investment areas I should look into in the weeks and months to come? Really, I am at the very beginning of the decision making process so any feedback will be greatly appreciated. Thank you!

Cheers
DUS

robber2

first thought is that as you are no longer a UK resident the ISAs are going to have to go !!

DUS

robber2 wrote: »

first thought is that as you are no longer a UK resident the ISAs are going to have to go !!

No...............they don´t...... i just cannot top it up anymore.....

Pincher

https://www.theguardian.com/cities/2014/feb/11/unaffordable-cities-berlin-rent-green-laws

"One property, an apartment block on Linienstrasse in Berlin Mitte, gives an alarming vision of Berlin's future: its value has multiplied tenfold since 1997. Then sold for the equivalent of €700 ,000, it has passed hands four times since and was last on the market for more than 8m euros."

In contrast, a flat I bought in London circa 1997, is now only four times the money. I should have bought in Berlin.

There seems to be a general backlash against Buy to Let though.


"Since a number of these cases have gained attention in the media, the German government has promised a crackdown on such practices. The coalition agreement between Angela Merkel's Christian Democratic Union party and the Social Democrats includes a pledge to bar landlords from signing new leases with rents that are 10% above the neighbourhood average, according to the guide to rental rates, the Mietspiegel (literally meaning "rent mirror"). Another cap would limit the period over which renovation costs can be passed down to tenants to 10 years – currently they can be passed down indefinitely."



The Sunday Times Money section last week did an article on page 2 about the tax changes in the UK. Also anti-BTL.

vsyrine

if you want to put your money on investing ask 1st what is your goal? Is it for short term or long term?

DUS

vsyrine wrote: »

if you want to put your money on investing ask 1st what is your goal? Is it for short term or long term?

I am surely someone who generally has a long term view on investment (10yrs +). I understand that with a view like that a "financial and economic doomsday scenario" that I expect to happen (see post #1) that historically if I can sit out any losses and use existing funds to drip feed into the market that then I shouldn´t worry too much about a major, major market downturn. And I kind of agree.

Where I struggle emotionally with that concept is that I don´t want to invest now when I expect a market meltdown in the foreseeable future. Putting 150k in a bank account (or I should say accounts with different banks) can only be a short term option. It also does not help me with my nagging thoughts that tell me to diversify.

I´ve got to smile a bit: in previous years I always sort of "envied" those users who posted about some sort of windfall money of 100k, 200k or more and who didn´t have a clue about what to do with the money. Then, I always said to myself "Oh these lucky &%"$&"%$! What a nice problem to have!" And yes, it is kind of a nice position to be in. But now that I am in such a situation I struggle to find a place for the money myself. How odd is that!?

Anyways, ´nuff said... :-)

DUS

bigadaj

So you can see the logic behind investment but we worried about the short term risk, which should really apply in the longer term.

One way I've rationalised things since the gfc is that the worst shock to the global economy since the Second World War was managed and contained, some people lost money but in the main people did OK if they were diversified. Communism has lost the debate about economic systems, unless you look at the Chinese version which is crony capitalism, so all the major economies have to do what they must to maintain it. If this involve zero or negative interest rates, printing almost infinite amounts of electronic money or anything else then that's fine.

Markets can fall but the principle of share owning capitalism must survive, even if this involves doing things that were anathema to many free market economists, such as providing an unlimited guarantee to banks to maintain the financial system.

So you may as well utilise this system to your advantage rather than lose out by suffering losses on cash, which in many propels eyes should be greater than those which have occurred as central banks would generally like higher inflation to reduce the debt inherited from the gfc and printing money on government bonds.

atush

If you can find someone who will let you open accts, then drip feeding into equities should take care of your fears. Esp as a drop in the first few years (you are saying the next 24 months) means you actually gain by buying units at lower prices which eventually rebound. Pound cost averaging.

Where will you go from thailand? If back to germany, put cash in euro accts. If uk, in GBP (but this could take a shock from Brexit).

atush

I would look into buying one years NI too.

With 9 years you are just under qualifying for a UK pension.

DUS

atush wrote: »

I would look into buying one years NI too.

With 9 years you are just under qualifying for a UK pension.

That´s a good point and although a slightly different topic I´d like to ask a question about this:

Before leaving the UK I contacted HMRC (?) inquiring about this. I asked something along the lines of "If I leave on 22 April 2016 will I still qualify for a UK pension and how much money would that be?" I don´t have the letter they sent at hand right now but they said that I made enough contributions to qualify (they mentioned the 10 years). The amount per week was minimal but still better than nothing. Could that be because whilst I only stayed for roughly 9 calendar years I paid into the system in 10 consecutive tax years (incl. the 2016/17 one)?

Also, if we forget Brexit for a moment, isn´t there an EU regulation in place that the years I paid into another member state´s system would be taken into account with regards to the "10 year rule" in the UK. I really don´t know but I believe I´ve read something like this when I first tried to find out what the rules were.

DUS

xylophone

See

https://www.gov.uk/new-state-pension/living-and-working-overseas

http://europa.eu/youreurope/citizens/work/retire-abroad/state-pensions-abroad/index_en.htm