10 Year Goal Putting Away £1000 Per Month

rob3770

Hi all,

We are a family with a young child and both are in our early 50's
Currently in a shared ownership property and own outright 25% = £160,000 with rent per month = £1,100 which rises around £50 per year.
We have £1000 per month that we can put 'somewhere' for 10 years with a possible £20,000 lump sum to kick it off (total = £140,000). This money after 10 years will be added to the 25% we get when we sell our current house and allow us to downsize and live rent free.

I have been looking at Santander's investment page which has the £140,000 returning...
Low: £127,000
Med: £198,000
High: £269,000

Any advise?

Should we shop around or are all banks investments virtually the same?
Is there a better option?

Cheers

Emmia

What's the investment type? Stocks and Shares ISA? GIC? 

Those numbers will be projections, and not guaranteed - what you go for depends a bit on your appetite to risk (and possibly lose) your money.

Mark_d

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

AlanP_2

Those Santander estimates will be for investments not savings so be aware that values of those can go up and down.

Given your ages I would suggest you give some thought to using a pension tax wrapper for this money and gain from the tax relief compared to non-pension savings / investments.

If you could tie in your retirement date with the downsizing date then that could work but you probably wouldn't be able to access it all in one go without paying more income tax than you need to.

How does it fit with your current retirement savings and plans rather than looking at the £1k per month in isolation?

rob3770

Mark_d said:

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

Does Interactive Investor manage the money (which funds etc) we invest each month?

rob3770

AlanP_2 said:

Those Santander estimates will be for investments not savings so be aware that values of those can go up and down.

Given your ages I would suggest you give some thought to using a pension tax wrapper for this money and gain from the tax relief compared to non-pension savings / investments.

If you could tie in your retirement date with the downsizing date then that could work but you probably wouldn't be able to access it all in one go without paying more income tax than you need to.

How does it fit with your current retirement savings and plans rather than looking at the £1k per month in isolation?

Only one of us has a private pension with currently around £200,000 in it. No plan to retire 

Mark_d

rob3770 said:

Mark_d said:

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

Does Interactive Investor manage the money (which funds etc) we invest each month?

I tend to build up cash savings with the hope of paying in a lump sum of £20k into my ISA each tax year.  Once the money is in my ISA I choose which shares and funds I want to invest in.

AJ Bell give you a little more guidance if you need it when choosing fund to invest in:

https://www.ajbell.co.uk/investment-ideas/ajbell-funds

When investing in funds, the fund manager manages what you're invested in so that the fund aligns with the specified risk profile and so that the fund is positioned for the growth it is seeking.

Eyeful

Savings & Investments are very different. To make sure we mean the same thing.

Savings: Money put into a bank or building society account covered by the FSCS up to £85K.

Investing: This is putting your money at risk. Basically gambling.
Long term (say at least 10 years): odds of winning HIGH
Short term (say less than 1 year) its called "speculating or trading" odds of winning low.

You can make investing as simple or as complicated as you like. 
Simple investing is best it is easy to learn, understand & keeps your cost down.
The more you pay out in fees & charges the less money ends up in your pocket.

1. Those Santander's numbers will be projections, and not guaranteed. When you use different annual return those numbers will change. No one can foretell the future not even Santander!

2. SIMPLE INVESTING, 
(a) Watch this video:  https://www.kroijer.com/
Now consider
(b)Low Cost Global Multi Asset Funds (for Cautious types & those that want more Control)

  This is a ready made portfolio, where you pick the share/bond split, you are most comfortable with.
Example:  https://www.hsbc.co.uk/investments/products/hsbc-global-strategy-portfolios/#balanceda 

(c) Other  Low Cost Global Multi Asset Funds are available:
https://monevator.com/passive-fund-of-funds-the-rivals/
(c) Target Day Funds. Examples:
https://www.vanguardinvestor.co.uk/investing-explained/what-are-target-retirement-funds
https://www.ii.co.uk/ii-accounts/sipp/sipp-investment-ideas/target-retirement-funds

3. You need to look up what Santander fund you intend to invest in, compare their fees and charges to those  mentioned above. Stick the numbers in to calculator below and see how fees, will alter the expected gains,
 https://larrybates.ca/

Albermarle

rob3770 said:

Mark_d said:

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

Does Interactive Investor manage the money (which funds etc) we invest each month?

If you want someone to properly manage investments on your behalf, then you have to pay someone to do it ( an IFA) .
However as already mentioned, you do not have to go around buying and selling shares etc, you can buy investment funds that do all that for you, but you have to pick the fund in the first place.
You can get general guidance on that, as in the example in the previous post, but it is still your decision in the end.

Only one of us has a private pension with currently around £200,000 in it

Three points here:
1) Presumably this £200K is in investments within the pension. How do you manage those ?
2) It is usually good practice to try and have some balance of pension provision between partners. It can be more tax efficient that way.
3) Are both of you on target to get full state pensions?

rob3770

Albermarle said:

rob3770 said:

Mark_d said:

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

Does Interactive Investor manage the money (which funds etc) we invest each month?

If you want someone to properly manage investments on your behalf, then you have to pay someone to do it ( an IFA) .
However as already mentioned, you do not have to go around buying and selling shares etc, you can buy investment funds that do all that for you, but you have to pick the fund in the first place.
You can get general guidance on that, as in the example in the previous post, but it is still your decision in the end.

Only one of us has a private pension with currently around £200,000 in it

Three points here:
1) Presumably this £200K is in investments within the pension. How do you manage those ?
2) It is usually good practice to try and have some balance of pension provision between partners. It can be more tax efficient that way.
3) Are both of you on target to get full state pensions?

The pension pot is managed buy the pension provider. I currently have 2 running and was thinking of combining them into one provider.

Both have been working and paying stamp (NI) our whole working life and will receive full state pension

Albermarle

rob3770 said:

Albermarle said:

rob3770 said:

Mark_d said:

Santander have never looked good for investments.  I think their charges are quite high.  Personally I use Interactive Investor for my investment but AJ Bell or Hargreaves Lansdown are also good choices.

Does Interactive Investor manage the money (which funds etc) we invest each month?

If you want someone to properly manage investments on your behalf, then you have to pay someone to do it ( an IFA) .
However as already mentioned, you do not have to go around buying and selling shares etc, you can buy investment funds that do all that for you, but you have to pick the fund in the first place.
You can get general guidance on that, as in the example in the previous post, but it is still your decision in the end.

Only one of us has a private pension with currently around £200,000 in it

Three points here:
1) Presumably this £200K is in investments within the pension. How do you manage those ?
2) It is usually good practice to try and have some balance of pension provision between partners. It can be more tax efficient that way.
3) Are both of you on target to get full state pensions?

The pension pot is managed buy the pension provider. I currently have 2 running and was thinking of combining them into one provider.

Both have been working and paying stamp (NI) our whole working life and will receive full state pension

That is highly unlikely and a common misunderstanding. Unless you are paying an advisor/wealth company to manage them.

You will have the choice of which investments to hold in your pension from the choice they offer.
For many workplace pensions, if you do not make a choice, they will put your money into their default investment fund.
This may or may not be suitable for you.
We have regular posters complaining about being in the wrong type of default fund ( usually one that changes automatically as you get older) and only realising that rather late in the day.

Suggest some further investigation into your pension investments could be a good move. More important than whether to combine them or not .