Lump Sum Investment

andybartlett

I have a lump sum of money to invest, £200,000, and have used my ISA allowance. I would like to put the money away for 2-3 years. Have been told that an ISA feeder is a good option and I do think this is not a bad idea, but I am not sure that I would want to put such a large sum of money at the mercy of the stock market. Could someone suggest an alternative?

vacheron

If you are looking to "invest" as you stated, there are numerous options other than the stockmarket. You have bonds, property, commodities, local businesses, racehorses, fine wine, ski resorts, watches, classic cars….. But without knowing anything about you, your plans or risk appetite, it is very difficult for strangers on the internet to recommend which may be the most suitable for you.

An ISA feeder may be one option, but it could take 10-15 years to move everything into an ISA, and you say you are only looking at a 2-3 year timescale. And then what would you be putting in your new ISAs?

For 2-3 years, most on here would recommend a savings account and to avoid investing altogether.

El_Torro

You are going to spend all the money in 2-3 years time? Buying a house for example? If you don't have flexibility in this then do not invest any of it, keep it in savings. Just find the best interest rate and go with that, bearing in mind the limits on the FSCS protection for cash.

If you're a 40% or higher income tax payer I'd put £50k into Premium Bonds.

InvesterJones

Compare the best fixed term accounts with what's available for gilts if you don't need it for 2-3 years - I think both would handily beat premium bonds, with the choice between savings accounts and gilts dependant on your tax situation.

Sam_666

Where did you get that idea that 2-3y is investment range?
You dont want to put large amount of money at mercy of market but want to ripe rewards of it. Really?

You should look for fix rate savings account.

dunstonh

I have a lump sum of money to invest, £200,000, and have used my ISA allowance. I would like to put the money away for 2-3 years.

An economic cycle is 15-20 years. You are talking about investing just 2-3 years. A major stockmarket crash can take 2-3 years to recover. A generational crash could take longer.

2-3 years is entirely unsuitable as an investment term. it would be a missale if an adviser was recommending it. So, why do you think it would be suitable?

 Have been told that an ISA feeder is a good option and I do think this is not a bad idea, but I am not sure that I would want to put such a large sum of money at the mercy of the stock market

What is an ISA feeder? I suspect they mean phasing, also known as dollar cost averaging.

However, it could mean putting £20k in an ISA and the remainder in a GIA and then doing bed & ISA each year. Or it could mean you do an ISA only each year, but that wouldn't fit with 2-3 years.

If you are investing for just 2-3 years, then the phasing will barely have had a time to have phased in before you are taking it all out again.

Could someone suggest an alternative?

Cash savings. Maybe a fixed term deposit.