Daughter about to inherit some money

bigpapap

Hi. My 21 year old daughter is due to inherit @£60k this month from a trust fund. Would anyone have any suggestions on how best to invest it. 

She already has a few thousand in standard cash ISAs and a few thousand in savings. She is very good with money. 

The money was always intended as a deposit for a first house and hopefully will be used for that (though not yet). 
She will be looking at low risk stuff I imagine. 

I’ve never had any savings so have no idea where to start!
Thanks for any suggestions given. 

xylophone

Does she have a LISA?

https://www.gov.uk/lifetime-isa

Middle_of_the_Road

bigpapap said:

Hi. My 21 year old daughter is due to inherit @£60k this month from a trust fund. Would anyone have any suggestions on how best to invest it. 

She already has a few thousand in standard cash ISAs and a few thousand in savings. She is very good with money. 

The money was always intended as a deposit for a first house and hopefully will be used for that (though not yet). 
She will be looking at low risk stuff I imagine. 

I’ve never had any savings so have no idea where to start!
Thanks for any suggestions given. 

If the house deposit would be needed within the next few years, investing in equities (stocks and shares) would not be recommended.
As mentioned above, a Lifetime ISA would be a good start.

https://www.moneysavingexpert.com/savings/lifetime-isas/

After that, maxing out her cash ISA allowance, (before any of the rumoured changes take effect) might help if she would otherwise have to pay tax on her savings interest.

born_again

https://www.bbc.co.uk/news/articles/c93kgye03j9o

Middle_of_the_Road

born_again said:

https://www.bbc.co.uk/news/articles/c93kgye03j9o

Ok, so any young first time buyers planning on spending £450k on their first home will be penalised within the Lifetime ISA rules.
Those will be edge cases, along with those who have paid in, and then find they've overcommitted their available funds, and have needed to pay the penalty for withdrawal.
LISA is a very good scheme if used accordingly.

poseidon1

bigpapap said:

Hi. My 21 year old daughter is due to inherit @£60k this month from a trust fund. Would anyone have any suggestions on how best to invest it. 

She already has a few thousand in standard cash ISAs and a few thousand in savings. She is very good with money. 

The money was always intended as a deposit for a first house and hopefully will be used for that (though not yet). 
She will be looking at low risk stuff I imagine. 

I’ve never had any savings so have no idea where to start!
Thanks for any suggestions given. 

If she has not used all or part of her 2025/26 £20k  cash ISA allowance, then that's an obvious start. Her choice whether to go easy access, fixed or both,

The balance in the best easy access saving account she can find earning her upwards of 4% plus.

Although only 21, if she is working she could look at her current pension contributions and where those contributions are currently invested.

If she feels inclined, the extra interest she will be generating on her inherited cash, could be diverted to higher pension contributions with the significant benefit this could achieve in later life. Remember at her age a state pension is likely only available at age 70 if not later, so building a private fund she can take far earlier certainly worth considering. Perhaps she can benefit from your own current involvement with occupational pensions?

Albermarle

I’ve never had any savings so have no idea where to start!

After advising your daughter what to do with her inheritance, it may be a good time to start building up your own pot.  It is very useful to have some emergency money stashed away ( new boiler, expensive house/car repairs, dental bills etc ) so you do not have to rely on loans, credit cards etc.