Where would you Invest £550,000 inheritance for at least 6 years until entitlement

dunstonh

Invest987 said:

Robin9 said:

Is this for a 12 year old who can't inherit till 18 ?

Does the £550K have to be held in trust ?

Yes it does until they are 25. I have found it a huge responsibility to know where to start with the investment bonds?

So, it is in an investment bond in trust?
Why are you trying to make this decision?   The trustees are the ones responsible and most trustees will cover themselves by employer an IFA to do all this.     
Plus, I suspect that the offshore and onshore bond wrappers are not available to DIY investors.

Invest987

Notepad_Phil said:

There are plenty of investment choices onshore, so why complicate things by going offshore.

Or do you mean investing in the UK or investing globally, in which case invest in the global markets.

Yes apologies, is one better than the other? 

Invest987

dunstonh said:

Invest987 said:

Robin9 said:

Is this for a 12 year old who can't inherit till 18 ?

Does the £550K have to be held in trust ?

Yes it does until they are 25. I have found it a huge responsibility to know where to start with the investment bonds?

So, it is in an investment bond in trust?
Why are you trying to make this decision?   The trustees are the ones responsible and most trustees will cover themselves by employer an IFA to do all this.     
Plus, I suspect that the offshore and onshore bond wrappers are not available to DIY investors.

I am the trustee and have seeked several IFA advice but just interested to see a wider opinion. 

theoretica

Does the person who will inherit the trust have an emotional opinion? Or feel strongly about ethical investments or something?  If investments do go down they are more likely to be accepting of this if they felt involved, and be better prepared to take over management themselves.

wmb194

The OP started a thread about this a year ago. Is there a lot more anyone can add? It was also £550k then, too, so I'm guessing nothing has happened with it?

https://forums.moneysavingexpert.com/discussion/6251974/inheritance/p1

Invest987

Yes you are correct. However due to covid and a difficult sale the money has only just come through. I just wondered in general how  other people would choose to invest the money. I have seeked a IFA advice. 

Malthusian

According to the OP's previous threads there are two beneficiaries - the OP's children now aged ~19 and ~17.

There is not enough information to say whether the individual beneficiaries can claim a share before 25 as others have assumed - it depends on the terms of the Will. However once the younger turns 18, if both the potential beneficiaries are compos mentis, they will be able to band together and wind up the trust before they turn 25. (Assuming English / Welsh law applies - if Scots they can do that already.)

 

Yes you are correct. However due to covid and a difficult sale the money has only just come through. I just wondered in general how  other people would choose to invest the money. I have seeked a IFA advice.

Personally I wouldn't. Once both the potential beneficiaries were over 18, assuming they were compos mentis, I would wind up the trust(s) and share out the money.

If the OP doesn't want to do that and the beneficiaries aren't going to go over their head, this is a tricky situation (as managing grown adults' money for them for free tends to be).

The term for investment is at most 6-8 years, and while it is likely that long term investments would beat cash over that period, it is also perfectly possible for them to go down.

All the beneficiaries should be meeting with the IFA (individually or together), not just the OP. Ultimately they are in control, and if they aren't now, they are going to be before too long. If they intend to spend the money as soon as they turn 25 and would not tolerate falls in value, cash may be the only appropriate option.

xylophone

Expression of wish in will is 25. 

In your position I would take  advice from a solicitor expert in wills and trusts.

An "expression of wish" is not binding on Trustees.

With regard to the entitlement of the beneficiary, it is vital to look at the wording of the will to determine what kind of Trust has been created as (inter alia) this will determine the treatment for taxation purposes.

See https://www.gov.uk/hmrc-internal-manuals/trusts-settlements-and-estates-manual/tsem1563

https://www.gov.uk/trusts-taxes/types-of-trust

https://www.lawsociety.org.uk/en/public/for-public-visitors/common-legal-issues/trusts

Has the bequest "Indefeasibly vested" in the beneficiary? If so, the Trust is a Bare Trust.

badger09

Not only does OP need the advice of an IFA, but also legal advice from a person properly qualified in Trust law.

Drip feeding information and seeking advice opinions from strangers, no matter how well informed, on an internet forum is at best, pointless IMHO.