What to do with 100K just sitting there?

Sumarokov

Hello, I wonder if someone can help me with a question about the best way to invest £100 K? It might seem easy, but there are a number of circumstances which are limiting me. I am a single male in my 40s.

* I know the obvious example would be in property (especially as I rent right now). But I live in London at the moment and my job situation is not 100% sure right now for getting a mortgage (even if I wanted to and I am not terribly hung on the idea of a property in London). I am not really interested in a (second) holiday home either, plus 100 K would not cover anything decent, I think.

* I am NOT interested in risk at all.

* I believe the best form of investment is investing in yourself but (1) I have done all this (2) educating yourself is free mostly or pretty cheap.

I am thinking that it might be best to just find secure savings accounts, so can anyone advise the best way to invest/split the money?

droopsnoot

Have you read through the main savings accounts article? https://www.moneysavingexpert.com/savings/savings-accounts-best-interest

AlanP_2

Sumarokov wrote: »

* I am NOT interested in risk at all.

Putting it bluntly - you should be interested, at least enough to appreciate what the relative risks are between alternatives.

It sounds to me that you are, actually interrst in Risk, and your comments about a London house / your job situation reflect that.

If you mean you are not interested in an investment where you COULD lose part of your capital in real numbers i.e. your £100k might drop to £95k then your only option is cash savings of some type.

This however ignores the eroison effects of inflation which is a risk that you would be taking, and would presumably be happy to accept, if you went down that route.

Risk can't be avoided, all you can do is minimise / manage the risks level & type you are happy to be exposed to.


What are your objectives / timescales for this £100k? Suggestions on what to do for the next year say would be different to what to do for the next 10/20/40 years.

jimjames

Sumarokov wrote: »

* I am NOT interested in risk at all.

* I believe the best form of investment is investing in yourself but (1) I have done all this (2) educating yourself is free mostly or pretty cheap.

I'd argue that you definitely haven't done that if you are stating that you have no interest in risk at all. Which risk are you not interested in?

enthusiasticsaver

You are risking the capital eroding in real terms by not keeping up with inflation. As others have said the risk of you losing money like that is very likely. If you are very risk averse and will not consider investing any of the capital in stocks/shares/bonds then really a cash savings account is your only option. You could look at national savings and investments or premium bonds. Fixed term bonds are another option with a high street bank or building society (don't be tempted by these small unregulated companies).

Personally though I think you will find if you educate yourself about risk and return then you could potentially get a much better return on that £100k. Buying property in London is expensive and you will need a very large mortgage so if your job is not 100% secure that may not be the best option. You could buy elsewhere in the country (maybe somewhere you might like to retire to one day) and rent it out but that comes with its own headaches.

If I were you I would be exploring putting some into a stocks and shares isa as you are not planning on using the money to buy property, maybe put some in a SIPP and a proportion in fixed term cash investment and accessible cash savings account if you do not have other savings.

Sumarokov

Hello, many thanks for the helpful replies. I have gone through the thread and thanked everyone who contributed.

I should add that I already have "risky" investments! I just want to be risky/non-risky in a ratio of 2/5. I thought it would be easier to just say that I am against risk ("I am NOT interested in risk at all... at least for this sum" ). Meaning I am not interested in high risk for this sum of £100K. It is the low-risk part of the capital.

The advice is helpful and I will look into all of the points made.

In terms of time-scale, I would say that I am looking at a period of about 20 years... just so long as the penalties are not TOO severe if something happens down the line that means I have to bail out of the investment...

jimjames

Thanks for the clarification, that certainly makes more sense. If you're 40 then 20 years would take you into your 60s and presumably close to retirement so what would the aim/requirement for this sum be? If house purchase is an option then presumably you'd want to do it well before then.

I can't think of any non risk products that would lock you in for 20 years but I'd also suggest that you reconsider your options. Holding cash or similar for 20 years is likely to see serious inflation erosion and that sort of timescale is far more appropriate for investing and in things like investments you generally aren't locked in at all.

Flobberchops

£100k, zero risk? I can think of very few things more boring than that, but I suppose my answer would be:

* visits https://www.bankaccountsavings.co.uk/calculator *

£20,000 in Virgin Money 5 Year E-ISA (2.4%)
£20,000 in a Santander 123 account (1.5%)
£15,000 in three Bank of Scotland accounts (2%)
£13,800 in Premium Bonds (1.15%ish)
£6,000 in two Tesco accounts (3%)
£5,000 in Club Lloyds (2%)
£4,800 per year into Lloyds Reg Saver (3%)
£3,000 per year into Nationwide Reg Saver (5%)
£3,000 per year into TSB monthly saver (2%)
£3,000 into NS&I investment growth bond (2.2%)
£2,500 in Nationwide FlexDirect (5%)
£2,400 per year into Santander Reg eSaver (3%)
£1,500 in TSB Classic Plus (3%)

Bear in mind though this would involve you setting up 16 accounts, paying 16 monthly direct debits (some to throwaway £1 charity accounts if necessary, though this eats into your return) and using your entire ISA allowance on (yuck!) cash in Year 1. I'd sooner just chuck it all on Lifestrategy 60, but it's your money!

atush

Have you got a pension?

If you dont own now, and dont want to own in London, where will you live in retirement? Buying outside of londin and renting it out, could be an idea to consider.

DiggerUK

With a time scale of twenty years you should consider gold.
If you buy uk gold coins there is no tax going in or out, in London the cheapest place to store would be with Metro Bank (you need an account)
Or you could put a gold investment in a SIPP, in your case locked away for 15 years. Other alternative is gold ETF’s which can usually be placed in isa’s.

Here are some sites for more info, price history, and two were I buy from..._
http://moneyweek.com/a-beginners-guide-to-investing-in-gold/
https://goldprice.org
https://atkinsonsbullion.com
http://www.elminvestments.co.uk/gold-coins.html

atush

The last thing i would consider is gold if you dont own a home