Inheritance 100k - What would you do in my situation?

Albermarle

InvesterJones said:

Linton said:

Why and how are people picking investments when no-one knows what the OP wants from their inheritance, both amounts and timeframes?

It's only one person to be fair, and I don't think they're being serious.

I think they are serious and to some extent I understand what they are getting at.

Often new inexperienced posters can get blinded by all the options set out in various replies and maybe just end up not doing anything, or just leaving it all in their current account. Remember that the large majority of the public are very bad in this area and what seems like a simple explanation to us, is a wall of impenetrable jargon to them .
So as long as some of the background facts are available, I do not see great harm in nudging them in a direction.

The old saying was that no one ever got sacked by recommending IBM. Maybe an alternative is that no one is likely to lose their shirt investing in VLS60 . Most peoples pension default fund is in something similar, although they will be blissfully unaware of it.. 

InvesterJones

Albermarle said:

The old saying was that no one ever got sacked by recommending IBM. Maybe an alternative is that no one is likely to lose their shirt investing in VLS60 . Most peoples pension default fund is in something similar, although they will be blissfully unaware of it.. 

As well as HSBC balanced?

Albermarle

InvesterJones said:

Albermarle said:

The old saying was that no one ever got sacked by recommending IBM. Maybe an alternative is that no one is likely to lose their shirt investing in VLS60 . Most peoples pension default fund is in something similar, although they will be blissfully unaware of it.. 

As well as HSBC balanced?

It is very similar to VLS60, except the 60% varies by a few per cent either side and there is no UK bias.
I think over the last few years it has returned about 1% pa more than VLS 60, but that may or may not continue. 

Linton

The OP is receiving I assume about £400/ month in UC which will stop once DWP are told about the inheritance. Therefore I assume that the money needs to be managed to generate at least £400/month, inflation linked,  for at least 17 years at minimal risk to the steady flow of income, and with minimal effort and stress for the OP.  Of course if the money runs out too soon the OP could go back to UC provided the inheritance was managed sensibly.

A significantly high % equity fund with I assume £400 of units explicitly sold every month does not seem to me to be the most appropriate instrument to meet the criteria.

It sounds to me more like a job for a fixed term annuity or perhaps something like an investment bond.

However one needs to get the various assumptions confirmed or corrected.

hflower74

Thanks for all the replies I am reading them and have been trying to reply with quotes but it's not been letting me post replies, sorry!

Checked and my pension forecast is 230.25.

I will lose 622 of UC a month  (7464 a year) 

I receive 140.25 a week from ESA  (7293 a year)

I don't think it would be worth adding to a private pension.

I do think it is probably best if I have short, medium and long term pots.

I'm not investment savvy it's all a bit over my head but I will keep reading and hopefully find something to invest in for the long term when the money comes through.

My aim is to get it to last as long as possible and hopefully not have to go on the dreaded UC again.

Thanks again for the replies and ideas and links.

Bostonerimus1

Lots threads from people inheriting significant amounts... but the basics remain the same.

Do a budget so you can see where to save and how much you need, although people on low incomes and benefits are usually pretty good at budgeting by necessity.

I'd put 6 months spending in the bank or maybe a cash ISA for emergencies.

Then pay off any high interest debt you have.

When that is done your priority should be tax advantages accounts, ie workplace pensions, ISAs and SIPPs. if you don't have a workplace pension open a SIPP and your full ISA allowance. To understand how you should invest your money inside your pensions, ISAs etc educate yourself about investment funds...for drawdown over what might be 30 years I'd probably use a balanced fund or a target retirement fund that started with a high equity allocation. I would try to avoid tying up money in houses or rentals. You might look into annuities if you want guaranteed income or a ladder of investment bonds of various terms.