£78K cash savings. How to grow it?

123Destiny

Hi everyone
I am single in my mid thirties and live in an adapted 1 bedroom council flat (am disabled) in London. I work for the council and my salary is £33K. After tax, NI, student loan, pension, my take home pay is £1,930. I also receive non-means tested DLA benefit at £600 a month. That makes my total income at £2,530 a month.

I have no debts except my student loan. My monthly spending is £960 (including rent, bills, spending money etc). I would have liked to get a mortgage, but I can't afford it and I can't move out of London. So it looks like I will continue to be a council tenant till retirement.

I will be signing up to LGPS AVC this month and hoping to put £400 monthly. Which will leave me with just over £1,000 spare cash to add to my savings.

From the £78K which is currently in a Marcus, I am willing to invest about £40k and leave the £38K in the marcus for emergency fund which can last me for 3 years.

I am a total novice to investing and the reason why I want to invest is because I would like to retire early (60 years old at the latest). I am willing to keep the money invested for 5 to 15 years.

From what I have read about investing, I am confused on where to start. Should I start with a S&S ISA or Vanguard or global index tracking fund or a multi-asset index fund?

Should I put more than £400 a month into the LGPS AVC?

Thank you

Albermarle

Should I start with a S&S ISA or Vanguard or global index tracking fund or a multi-asset index fund?

Like many people you are mixing up the tax wrapper,  the provider and the actual investment.

A S&S ISA is a tax wrapper - it means that any investment you have within it is protected from tax , within certain rules.

A pension is also a tax wrapper but with different rules.

Within an S&S ISA or a pension , your money is in investments that you choose , such as  a global index tracking fund or a multi asset fund amongst many others.

Some companies just provide the tax wrapper for a fee. Some companies provide the investments for a fee. Some are involved in both ( like Vanguard) . 

Try not to mix up the tax wrapper with the actual investments as many people do.

colsten

Have a read of this: https://monevator.com/category/investing/passive-investing-investing/

El_Torro

If £38k will really last you 3 years then yes, it's a good idea to invest the remaining £40k. As long as you invest for 10 years or more then that £40k should give you a much better return than leaving it in a savings account.

Your £40k investment should either go into a pension or a S&S ISA. I don't know much about council pensions. so I can't suggest whether you should pay more into the AVCs. You should certainly pay the minimum into your council pension as the DB pension it provides is great.

enthusiasticsaver

I would certainly maximise your LGPS and doing AVCs is a good idea too. You can get quotes from the pension administrator but an additional £400 per month is a good start.  I would also open a stocks and shares isa and put £20k in there to maximise your allowance for 20/21 and then maybe put another £20k in there after April when the new tax year starts.  Having separate pots is a  good idea if you are planning to retire early as with pensions you are limited as to when you can draw on them. 

Read up about investing and yes the Vanguard Lifestrategy funds are one option and these are multi asset funds.  The main things to remember is diversify and do not invest above your risk appetite.  You are still quite young though so to gain maximum  growth having a fairly high level of equities is probably a good idea. Global index trackers  are another option especially if you are new to investing.  They are highly diversified and usually low charges. 

TheShape

S&S ISA and a S&S LISA (if eligible).  For retirement or could be used for property purchase if that becomes an option.

Alexland

I would suggest making the most of your LGPS pension options and then consider using a S&S Lifetime ISA to earn a 25% government bonus on contributions of up to £4k per tax year for withdrawal from age 60+ (or against a first time property purchase up to £450k).
If you are new to investing that bonus might provide some comfort when stock markets go down (as the first 20% of any loss is the government's money). Vanguard don't offer S&S Lifetime ISAs so you would need to consider plaforms such as EQi and AJ Bell who are both fairly good value. Then on those platforms you would need to pick an investment fund from Vanguard, HSBC, etc.
Is it likely that you would ever get the chance to buy your council flat?

123Destiny

Thanks everyone for the advice. I will check out the monevator link.
I will look into reading more about S&S ISA, investing and put more money into my pension.
Regarding LISA, I would like to put money into it but I am concerned that the government might change the age from 60 years old to a higher age. Is that possible? 
Regarding buying my flat, I wont be able to buy it. It is so expensive because of the area I live in.

Albermarle

but I am concerned that the government might change the age from 60 years old to a higher age. Is that possible?

Anything is possible but you can not plan on what might be , only what you know now .

Probably in the great scheme of things the amounts in retirement LISA's are small beer compared to pensions for example , so may well be off the radar for things like age changes anyway.

mooneysaver

Given your risk tolerance I would recommend an SMT gold SIPP via coinbase.