£100k+ Inheritance advice

Audaxer

kidmugsy wrote: »

You can't possibly know such a thing unless you have a hotline to God.

The OP's caution seems perfectly reasonable to me: "it seems it is at a late stage of growth cycle and feel i have missed the boat somewhat" is probably roughly consistent with UK/US stock market history.

I agree. While the stock market may be a good long term option, the OP needs to be realistic about his risk tolerance and decide whether he wants to invest it all now, and whether he is knowledgeable enough and confident enough to DIY his investments.

Fatbritabroad

kidmugsy wrote: »

You can't possibly know such a thing unless you have a hotline to God.

The OP's caution seems perfectly reasonable to me: "it seems it is at a late stage of growth cycle and feel i have missed the boat somewhat" is probably roughly consistent with UK/US stock market history.

Of course if you want to argue that history should be ignored - on the grounds, for example, that the era of QE and ZIRP is unprecedented - then that leaves you with no case at all for saying that the stock market is mathematically the best option.

In the OP's shoes I might decide to make no dramatic decision until the question of remortgaging arises i.e. about 17 months after he receives the money. I might continue with the present policies of funding pensions and ISAs, and follow the suggestions of others of seeking to earn interest at higher rates than he pays on his mortgage.

Separately I might consider whether there would be an advantage in setting up my own limited company and working as a contractor rather than being self-employed. I think I might also persuade myself to read the personal finance pages in the Saturday papers, particularly for a few weeks after each Budget (the next one is due later this month), and at the transition of the tax years i.e. mid March - mid April.

I'm not claiming to have a holine to god, buffet or anyone else which is why i also said alternatives he could consider like paying a bit more of the mortgage and putting some in ns and i until he was more confident but surely you'd agree his pension looks a little light and if so that is normally invested in the stock market in one way or another isn't it? And how I initially gave him the scenario of simply upping his payments monthly over the next ten years if he was nervous

I also said the more knowledge you have the more confidence you have in your decisions. Suggesting he research is implied in that

And I also said it depends on his time line for when he needs the money. If he isn't going to need to access it for 20 plus years then past experience would suggest the stock market is the best long term the option? Isn't it? where else would he put it? He already has a large amount in his property

If there's anything there to take issue with (other than wanting to be deliberately contrary) i'd like to know what it is please.

Fatbritabroad

I didn't say he had to do it now either. He doesn't have to do anything now if that's how it came across I apologise.

Paul_the_electrician

Audaxer wrote: »

I agree. While the stock market may be a good long term option, the OP needs to be realistic about his risk tolerance and decide whether he wants to invest it all now, and whether he is knowledgeable enough and confident enough to DIY his investments.

I have a reasonable knowledge of my investments(no professional by any means)

My main holdings are blackrock consensus 85 for ISA and lifestrategy 100% for pension and LISA with 3 or 4 small satellite active funds in china/india and emerging markets & hsbc ftse 250 tracker

The drip feeding per month is fine and im perfectly comfortable with this but 100k into the SM in one go makes me feel a bit nervous to be honest

Paul_the_electrician

kidmugsy wrote: »

Separately I might consider whether there would be an advantage in setting up my own limited company and working as a contractor rather than being self-employed.

I have actually mentioned this to my accountant and he told me the perks for going LTD on my income are no longer viable,

Has he missed something?

kidmugsy

Paul_the_electrician wrote: »

I have actually mentioned this to my accountant and he told me the perks for going LTD on my income are no longer viable,

Has he missed something?

I'm a bit surprised but he's probably more up to date on it than I am.

By the way, your wife pays no income tax and you pay basic rate. Have you taken advantage of the marriage allowance?
https://www.gov.uk/marriage-allowance

Albermarle

The drip feeding per month is fine and im perfectly comfortable with this but 100k into the SM in one go makes me feel a bit nervous to be honest

I think would make most people a bit nervous after a 6 year bull run :Dso I would agree drip feeding is the common sense way . Only to say do not stop the drip feeding or be tempted to sell investments if the market has a big wobble . Best in the long run to hold your nerve.

Thrugelmir

Paul_the_electrician wrote: »

I have a low LTV on my mortgage now and with the rate so low, think that paying this lump sum off the house would not really achieve a good return for my money, however with interest rates rising in the possible near future and stockmarkets having such a good run??

While you may have a low LTV. You still owe a £185k. Any future rise in interest rates is going to cost you significant amounts of money over the remaining term of the mortgage. Given your self employed status and that you've a family to support financially. How comfortable are you with this level of debt. Peace of mind is priceless ultimately.

What ever you choose to do. Paying down your mortgage further is worthwhile. Security before speculation is a steady course to follow.

Audaxer

Paul_the_electrician wrote: »

I have a reasonable knowledge of my investments(no professional by any means)

My main holdings are blackrock consensus 85 for ISA and lifestrategy 100% for pension and LISA with 3 or 4 small satellite active funds in china/india and emerging markets & hsbc ftse 250 tracker

The drip feeding per month is fine and im perfectly comfortable with this but 100k into the SM in one go makes me feel a bit nervous to be honest

I understand you hesitance to invest it all at once. Another option could be invest some of it as a lump sum now, but in less equity heavy funds than the ones you already hold, so that if there is a large fall in the near future, you will have less of a loss on the new investment, but could benefit from then changing from selling some bonds/fixed interest and investing in more equity at cheaper prices.

Paul_the_electrician

Thrugelmir wrote: »

While you may have a low LTV. You still owe a £185k. Any future rise in interest rates is going to cost you significant amounts of money over the remaining term of the mortgage. Given your self employed status and that you've a family to support financially. How comfortable are you with this level of debt. Peace of mind is priceless ultimately.

What ever you choose to do. Paying down your mortgage further is worthwhile. Security before speculation is a steady course to follow.

and it is this reason exactly that keeps my head going round in circles, at most i could wipe off £120000 from that and carry on merrily with a mortgage of around £60k and continue with my £1k per month investment

for me saving for a pension seems to have no point at which ill ever know ill defiantly have enough, bit like putting money into a black hole that will never be filled, theres so many unknown unknowns. and with rough calculations ill need to have around £600k invested to have a relatively modest income to draw from

paying off a mortgage is so much a more clear cut goal with an achievable end, i suppose thats why most fall into the trap of having an underfunded retirement