Long term options to make most of £300k+

Sunnydays3

Hi all,

I've trawled through these boards significantly, looking at various bits of advice for people who come across some windfall money and/or are finding shorter term options to put their money to work rather than have it sit in a 1.5% yield savings account. 

I feel like I've exhausted options for this sort of figure and was hoping I could get some steer. This money was recently unlocked from various stablecoins where I was earning 12-20% yield, which I am fully conscious I won't be able to match especially given current market conditions. 

Going through the 'standard laundry list' of what is recommended for savings:

• Cash / stocks & shares ISA: already maxed out for the year
• Mortgage overpayments: already maxed out for the year
• NS&I bonds: maxed out
• Pension contributions: on track to maximise my annual allowance as well as use up any carry over from past years
• stocks + shares investments: 12% of my portfolio in this, which is about my comfort level at the moment (but would entertain options!)

I do not hold any other property other than my home. This is something I've looked into extensively, especially as a highest rate tax payer there are some benefits, but it does feel like with landlord rule changes the effort for a 5% yield is immense - and it's a LOT of work as I'd need to set up a limited company and really scale to make this worthwhile. 

Open to any suggestions you guys may have?

Thanks!

Daliah

Go see an IFA.

bostonerimus

How is your pension invested? You might consider an ISA and a general investment accounts with a similar asset allocation. That's after you have saved at least 6 months spending in the bank, paid off all high interest debt and maxed out the pension.

InvesterJones

Since you've already covered the basics it's time to think about what your goals are and how to progress towards them - the IFA suggestion is great, especially if your goal is something that can only be attained with further wealth generation.

Otherwise, enjoy it! Don't leave it too late to turn money into something that you'll appreciate - that's the most 'work' that money can do for you after all.

Linton

You do need tohave a rough plan of why and when you want to access the money.  That should drive how you invest/save it.  For example if you want it all within 5 years then anything other than cash could be very foolish.  On the other hand if its not going to be touched for 20 years keeping a sizeable amount in cash inflation could reduce its value significantly.

Albermarle

A DC pension or a S&S ISA are just another way of investing, but with different tax treatment.

So from an investing point of view they are the same as investments outside these tax wrappers. Maybe this is how you already think, but many people do not.

So a first step maybe to calculate your asset allocations accurately. For example 

Cash ( savings accounts + premium bonds + NSI bonds etc ) 

Equity ( all share investments, including those in funds etc)

Non equity investments ( means mainly bonds/gilts usually ) 

I would not include your home in this exercise but obviously would include any other properties, if you had any.

Then any debt + mortgage.

Then depending on your age and risk profile, it might be clear that the allocations are unbalanced.

This in simple terms is the sort of exercise an IFA would do .

Frequentlyhere

Have to say, I'm struggling to reconcile in my mind that you both had £300k invested in high yield cryptocurrency and yet also feel iffy about exceeding 12% overall in stocks and shares.

Low cost index trackers often make up 30-50% of even conservative investors portfolios, whilst most people would struggle with the volatility/risk of even 5% of their wealth in crypto. 

I'm a bit confused though as to your actual % equity allocation as there seem to be pockets in various places. What % overall is your equity allocation from pension, S+S ISA and any other General investment account?

Sunnydays3

bostonerimus said:

How is your pension invested? You might consider an ISA and a general investment accounts with a similar asset allocation. That's after you have saved at least 6 months spending in the bank, paid off all high interest debt and maxed out the pension.

It's a corporate pension - it's probably safest / easiest sticking in the group pot rather than straying away (which is possible, just more of a pain...). 

ISA is done, and I do have a general investment account but it's quite small as I've prioritised other avenues to date. But yes it does feel like this is the right approach, other than consulting with an IFA. 

Sunnydays3

Frequentlyhere said:

Have to say, I'm struggling to reconcile in my mind that you both had £300k invested in high yield cryptocurrency and yet also feel iffy about exceeding 12% overall in stocks and shares.

Low cost index trackers often make up 30-50% of even conservative investors portfolios, whilst most people would struggle with the volatility/risk of even 5% of their wealth in crypto. 

I'm a bit confused though as to your actual % equity allocation as there seem to be pockets in various places. What % overall is your equity allocation from pension, S+S ISA and any other General investment account?

OK to be fair it's a bit more complicated than that - I get why you're puzzled. The £300k in high yield crypto wasn't £300 at the start of the year - it was less than 1/3 that. Rest were in foreign investment assets that have been liquidated too. 

Combining pension, S+S ISA + general investment accounts account for about 40% of my portfolio. Remainder is in the home equity, cash (this topic), and a chunk remaining in crypto that isn't going anywhere (hopefully ).