vulnerable investor

daniel_3-2

ok, so i've hard a cash windfall of £50,000. The Question now is what to do with it. I've read the various articles about the savings fountain and consequently will invest the first £3,000 into mini Isa. But what about the remainder? I know this question will appear on this site often but as a financial newbie i would appreciate your wise words and help me get the best return. I'm completely novice with all of this hence my vulnerabilty. What would you guys do? Thanks in advance

sneekymum

It kinda depends on who you are really.

Some people would pay off their mortgage. Others would use it as a downpayment before starting a mortgage. I guess lots of people here will help with suggestions but it would help to know how old you are - if you have children - plans to retire soon or leave school - have you a house - a pension - are you a tax payer - a higher tax payer - unemployed...

"Best return" depends on your circumstances.

daniel_3-2

ok, i'm 30 with no mortgage or rent just a service charge each month. I will be getting married in October and we have no kids and no plans short term to have any. We both run a small company which is doing ok so we are self employed also. We also have no need for a pension. It has been mooted but beleive me when i say there really isn't any need for one. The cash in question will not be used for at least six months after which time we will consider buying a property. Does this help?

jimclark1967

In which case you might consider putting it in a savings account at just over 5% (see the instant access savings article) until you buy a house than use most of it as a deposit.

As sneekymum says though, you need to do what's best for you. Good luck with the wedding!

JC

sneekymum

Yep - got to agree with Jim there - Mini Cash ISA + 5% Savings Account is what I'd go for if I wanted the cash back in six months. Higher returns are possible but with either risk, initial investment fees or both. Sorry its not very exciting.

daniel_3-2

I was goping for some super exciting get rich quick scheme! If this is both your considered opinions then I guess this will be the best option. Thanks guys.

dunstonh

Get rich quick schemes involve taking some risk. Risk is a sliding scale and different people have different views on risk.

If the money was longer term, then risk becomes less. For example, people that invested in commerical property funds over the last 20 years have seen around 10-15% p.a. net average returns. However, one year in that 20 had around 5% drop. So, anyone investing for 1 year and happened to pick that bad year would have lost money. Anyone investing for a longer period would have done nicely. So, you have to look at your goals and timescale and invest appropriately for that.