What would you do with £250k?

Aussieinscotland

Hello,

Just looking for some ideas of what would be the best plan to do with an unexpected windfall of £250k? Having a mortgage of £70k locked in for 9 years at 2.09% I’m not keen to pay this off and other than setting up ISA’s for my kids future, I’m not sure what to do. I’m thinking of maxing out my wife and I’s ISA limits on a medium risk stocks and shares, but what else. Safety wise locking in standard savings at 4% seems sensible, but what are the other options. I’m a basic tax rate payer, but in 5 years will be a 40% tax payer and employed by the NHS. 

Any ideas or warnings appreciated. 

Band7

pension pension pension

MX5huggy

Pension. If you’re not in the NHS pension currently. Then when you join you have one year to transfer in if you wish. I would be looking at moving as much as possible to a pension in the period before joining NHS with a view to transferring it. 

sevenhills

How about a FTSE 250 INDEX tracker or a tracker of your choice, you will be limited to how much you can pay into a pension.

george4064

£250k buy FTSE 250 Index
£100k buy FTSE 100 Index
£225k buy Nikkei 225 Index
£500k buy S&P 500 Index
£1,000k buy Russell 1000 Index
£50k buy EuroStoxx 50 Index

Anymore? 

Linton

What do you want the money for? Until you have some objectives and timescales you cannot decide what to do with it now to best effect.  

You don’t have to do the same thing with all the money. For example you could hold some in cash for the short term for holidays, house improvements etc. Some could be invested in his and hers pensions for future early retirement. Some could be put in in children’s ISAs as you say,…..

Cisco001

Mortgage - have you calculate the interest you reduce by overpayment Vs put the cash in savings and pay off at the end?

redux

Cisco001 said:

Mortgage - have you calculate the interest you reduce by overpayment Vs put the cash in savings and pay off at the end?

If the mortgage is just over 2% and savings rates are higher than that, it makes sense not to hurry to pay it off.

Zerforax

redux said:

Cisco001 said:

Mortgage - have you calculate the interest you reduce by overpayment Vs put the cash in savings and pay off at the end?

If the mortgage is just over 2% and savings rates are higher than that, it makes sense not to hurry to pay it off.

Or he could compared the early repayment charge cost vs the cost of interest over the 9 years and just have it paid off?

thegentleway

I’d give some to charity and invest the rest, some in kids jisa

Sarahspangles

You’re likely to end up paying tax on some of the interest earned - if you move £20k each into ISAs before 5th April and again on April 6th, and get 2.5% interest on the remaining £170k I think you’ll pay tax on over £3k of your interest.  Premium Bonds prizes are interest free and although the ‘interest rate’ isn’t entirely guaranteed it’s more attractive if you don’t pay tax on it!