Investing 250k - 350k for income

Audaxer

tightauldgit said:

dharm999 said:

If you want to invest in property have you looked at Property Investment Trusts?  I have money in AEW (AEWU moniker).  Has a dividend yield of over 6%, invests in commercial property, but you are taking a risk with your capital.  There are plenty of others to look at if that was of interest

I’m happy to take long term view, as I don’t have enough invested in commercial property, for diversification purposes, and plan to hold it for a long time

I'll take a look at it. I appreciate NOTHING is going to be completely risk free so I'm prepared to accept some level of risk on the investment. I just don't want my nest egg wiped out by chasing speculative returns. I think to be honest what I am probably looking for is confirmation that I am doing the right thing holding onto the house and renting it out (at least for now) and then maybe over time look to build up a diverse portfolio of stocks with good yields while also making best use of my pension fund.   

It will be more diversified and less risky if you look at funds or Investment Trusts rather than individual stocks. Some Investment Trusts have a good record of growing dividends every year over a number of decades - they are known as IT Dividend Heroes. However not everyone looking for income just looks at funds/ITs with good yields. Many investors take income from Total Return, that is selling capital from growth as well as dividends. A low cost, globally diversified multi asset fund can provide a simple solution if looking for income from total return, and may be a better solution than just funds or ITs with good yields. However I would suggest you do a fair bit of research on here and sites like Monevator before making any decisions.
 

adindas

tightauldgit said:

dharm999 said:

If you want to invest in property have you looked at Property Investment Trusts?  I have money in AEW (AEWU moniker).  Has a dividend yield of over 6%, invests in commercial property, but you are taking a risk with your capital.  There are plenty of others to look at if that was of interest

I’m happy to take long term view, as I don’t have enough invested in commercial property, for diversification purposes, and plan to hold it for a long time

I'll take a look at it. I appreciate NOTHING is going to be completely risk free so I'm prepared to accept some level of risk on the investment. I just don't want my nest egg wiped out by chasing speculative returns. I think to be honest what I am probably looking for is confirmation that I am doing the right thing holding onto the house and renting it out (at least for now) and then maybe over time look to build up a diverse portfolio of stocks with good yields while also making best use of my pension fund.   

We are currently in a bear market. Throwing lump-sum 250k-350k of your life saving money in the stock market in one go during the bear market is not the best strategy.

Buying a good investment now you might get it at a bargain price. But Who knows (I do not say it will) your money will further down 10-20% in just a few months. Doing Dollar Cost Averaging down (DCA) during the BEAR MARKET will normally do better than throwing lump-sum. But what are you going to do with the rest of your cash ??. As other people have said diversification might suit for the majority of people put your wealth into multiple assets. But You can not do half-half as you cannot sell half of your house.

We will never know when the bear market is over. The bear market in average takes about 10 months, the longest one is 61 months.

If I were you I would prefer to rent it especially if I could get a guaranteed income of £1,500. You could always sell your house later when the bear market is over. Depreciation of your house price is unlikely a big concern (If any).

In the bull market you might for instance buy a low risk fund, high quality blue chip stocks paying dividend especially what is  the so called the dividend Aristocrat.

https://www.investopedia.com/terms/d/dividend-aristocrat.asp

The bear market does not come often. When the bear market is over it is highly unlikely will come back within less than five years (say). Unless of course there is black swan event such as China attacking Taiwan where the US and Russia might get involve.

That is my personal opinion, you might want to do DYORs, or DDs to determine the best course of actions to meet your objective.

fizio

Given the state of stock markets and low interest rates, I am glad i have some property investments as well - despite landlord and tax hassles

Linton

fizio said:

Given the state of stock markets and low interest rates, I am glad i have some property investments as well - despite landlord and tax hassles

Given the state of the stock markets and low interest rates I am glad I have enough £ to buy a rental property iinvested in globally diversified income funds in an S&S ISA.  Zero tax, and zero hassles - the income turns up in my current account automatically.