What would you do with my money?

DestinyGamer

I’m about to come into some money from a medical negligence claim - around £50,000.

My partner and I haven’t had this kind of money before and want to get on the property ladder after renting for the past 11 years. I’m intrigued to find out what you would do in our position with this money and if you have any advice for us.

To help you I’d like to share a couple more things about us:

We are both in our late 30’s

We can’t have children and have no interest in adoption

He’s an Assistant Store Manager earning 16,000 p/a

I’m a retail assistant earning £12,000 p/a but would like to cut back on hours due to my health

I’ve always expressed an interest in owning more than 1 property

He wants a forever home

We don’t have a car right now

If you’d like more info please ask

Sea_Shell

I know it sounds boring, but do you have any pensions?

DestinyGamer

Only through work.

AdrianC

DestinyGamer wrote: »

He’s an Assistant Store Manager earning 16,000 p/a
I’m a retail assistant earning £12,000 p/a but would like to cut back on hours due to my health

So he's just on minimum wage (assuming full-time)? Again, assuming minimum wage, you're looking to go down from about 3/4 time to...? 1/2? So £8k or so.

Does he have any scope (or desire) to increase his income?

I’ve always expressed an interest in owning more than 1 property

Why?

Where in the country are you, and what are property prices like in your area?

DestinyGamer

Yes, I’m minimum wage. Unfortunately due to my health I’ve lucked out on the work front. I won’t be reducing my hours in the next 5 years but come my forties I know my health will start to deteriorate if I continue working in my current physically demanding role. I’d like to find part-time work or change industries. Currently I’m in retail.

He’s doing very well, worked his way up in the past 6 years with one company and he plans to continue upwards to Store Manager in the future.

We live in Norfolk and plan to stay in this area. The further away from Norwich the cheaper house prices tend to be. But renting is going up. Currently in our area rent is upwards of £750 p/m and we are on the lower end - £625 p/m which is the most we have ever paid for rent.

I’ve always thought that if I had enough money I’d buy a holiday home to rent out or a buy-to-let which would bring us in an extra income and be nest egg for the future.

tom9980

DestinyGamer wrote: »

Yes, I’m minimum wage. Unfortunately due to my health I’ve lucked out on the work front. I won’t be reducing my hours in the next 5 years but come my forties I know my health will start to deteriorate if I continue working in my current physically demanding role. I’d like to find part-time work or change industries. Currently I’m in retail.

He’s doing very well, worked his way up in the past 6 years with one company and he plans to continue upwards to Store Manager in the future.

We live in Norfolk and plan to stay in this area. The further away from Norwich the cheaper house prices tend to be. But renting is going up. Currently in our area rent is upwards of £750 p/m and we are on the lower end - £625 p/m which is the most we have ever paid for rent.

I’ve always thought that if I had enough money I’d buy a holiday home to rent out or a buy-to-let which would bring us in an extra income and be nest egg for the future.

You will get a mortgage on your joint income of £80-110k most likely, add the £50k and you are looking at a house purchase of £150k. No idea what that buys you both where you live, here that is a 2 bed semi or a 3 bed semi ex council house at most.

As for your dream of BTL property, you simply do not have enough money to do it, you need deep pockets for the inevitable tenant cant pay the rent for 10 months before eviction, voids and repairs that always crop up.

My advice is buy the best property you can to live in that is in a good area that leaves you will £5k+ savings.

00ec25

DestinyGamer wrote: »

We live in Norfolk and plan to stay in this area. The further away from Norwich the cheaper house prices tend to be. But renting is going up. Currently in our area rent is upwards of £750 p/m and we are on the lower end - £625 p/m which is the most we have ever paid for rent.

I’ve always thought that if I had enough money I’d buy a holiday home to rent out or a buy-to-let which would bring us in an extra income and be nest egg for the future.

you are approaching this from entirely the wrong direction, how to spend a lump sum is not the answer. You need to look at your total financial equation.

you say you live in "Norfolk" yet have not given any indication of property prices in your actual area, so apart an implication you are in/near Norwich, which is of course the most expensive location in the area, what can you actually afford?

Your income is "low", so do you understand how mortgages are calculated? Have you read this?
https://www.moneysavingexpert.com/mortgages/

the further "out" you live, the more you will spend on transport to get to work - yet you do not have a car and have health issues. So presumably cycling is impossible, in which case what is the cost and service like on the bus? train?

PS forget about owning multiple properties (or even one) to let because you simply do not the financial where with all to go down that route.

AdrianC

DestinyGamer wrote: »

Yes, I’m minimum wage. Unfortunately due to my health I’ve lucked out on the work front. I won’t be reducing my hours in the next 5 years but come my forties I know my health will start to deteriorate if I continue working in my current physically demanding role. I’d like to find part-time work or change industries. Currently I’m in retail.

And your OH?

He’s doing very well, worked his way up in the past 6 years with one company and he plans to continue upwards to Store Manager in the future.

But £16k is f/t minimum wage.

We live in Norfolk and plan to stay in this area. The further away from Norwich the cheaper house prices tend to be. But renting is going up. Currently in our area rent is upwards of £750 p/m and we are on the lower end - £625 p/m which is the most we have ever paid for rent.

Within five miles of Norwich, you're looking at £100k for one-bed flats.

I’ve always thought that if I had enough money I’d buy a holiday home to rent out or a buy-to-let which would bring us in an extra income and be nest egg for the future.

A single £50k windfall plus 1.5x minimum wage is not BtL empire territory.

AnotherJoe

DestinyGamer wrote: »

I’ve always thought that if I had enough money I’d buy a holiday home to rent out or a buy-to-let which would bring us in an extra income and be nest egg for the future.

So you think, almost certainly without having having factored in taxes on purchase, income, sale, plus expenses, the risk of major expense due to non payment of rent and damage, plus the stress and work involved. And that's before all the new rules and regulations on tenancies come into play.
You asked "what would you do" and my answer is, I'd buy a place so that my "pension" consisted of not having to pay rent throughout my later years.
In any case you are currently in no position to be buying a property to let so start with the basics and sort out you own secure accommodation.

FreeBear

AdrianC wrote: »

Within five miles of Norwich, you're looking at £100k for one-bed flats.

https://www.rightmove.co.uk/property-for-sale/property-66826506.html

Public transport is .... meh. You will need a car to avoid the feeling of isolation. And a store "manager" on £16K p.a. - Must be Poundland... A manager should be on a much higher wage than shop floor workers !!

AdrianC

FreeBear wrote: »

https://www.rightmove.co.uk/property-for-sale/property-66826506.html

50% shared ownership with a local tie.

And a store "manager" on £16K p.a. - Must be Poundland... A manager should be on a much higher wage than shop floor workers !!

I'm not at all surprised they're all on MW. The main difference is going to be in contract - the deputy manager will be FT employed, while most of the floor staff will be casual/"zero hour".