where can i put my £90,000 to top up my £1200 a month income

uok

I am having to retire on medical grounds soon, my company are giving me a tax free lump some of £90,000 and about £1200 net a month from my pension, but no financial advice, where can i put my £90,000 to top up my £1200 a month income and how much is it likely to give me now or in the future?


thanking you in anticipation


uok


50 next month
7 years left on mortgage about £18,000
no kids
wife still works

jem16

As you will want this money to supplement your pension for a long(hopefully) time you should really be looking at investing it. Putting it into savings accounts will eat away at the capital owing to inflation as you will be taking a monthly income.

Realistically you should be looking at an income of around 5% from it and still be able to provide for growth of the capital as well.

You should really consult an IFA who will be able to look at your long tern plans and build a portfolio that will take into account your attitude to risk.

uok

My attitude to risk ( low ) and how much roughly am I looking at for advice from a financial adviser?


thanking you in anticipation


uok

50 next month
7 years left on mortgage about £18,000
no kids
wife still works

jem16

uok wrote: »

My attitude to risk ( low ) and how much roughly am I looking at for advice from a financial adviser?

Maximum commission taken is usually 3% with 0.5% annual trail commission. Average is 1.8% with 0.5% trail so try and aim for that.

ffacoffipawb

uok wrote: »

I am having to retire on medical grounds soon, my company are giving me a tax free lump some of £90,000 and about £1200 net a month from my pension, but no financial advice, where can i put my £90,000 to top up my £1200 a month income and how much is it likely to give me now or in the future?


thanking you in anticipation


uok


50 next month
7 years left on mortgage about £18,000
no kids
wife still works

Use £18,000 to pay off mortgage as thje rate is likely to exceed any net rate you receive on deposit.

As for the other £72,000

Open a cash ISA - Intelligent Finance's ISA pays interest monthly. Maximum £3,600 contribution.

Leaves just under £70,000 - split 50-50 with Icesave instant access or fixed rate (monthly interest options) and any other high paying provider - Kaupthing Edge, Northern Rock, Alliance and Leicester ......

And of course no mortgage to worry about!!

(Don't forget share ISAs / direct share investments with some of the money if you can stomach a bit more risk)

Mikeyorks

The advice you're looking for is at post #2.

If you're withdrawing the interest then ISAs / savings accounts will simply erode your capital at circa 4% currently.

But make sure it's an independent adviser and not tied to a Bank etc. Also that it's one who specialises in investments. The cost ..... worth paying in your circumstances. A decent IFA will 'save' you considerably more than he / she costs.

uok

jem16 wrote: »

uok wrote: »

My attitude to risk ( low ) and how much roughly am I looking at for advice from a financial adviser?

Maximum commission taken is usually 3% with 0.5% annual trail commission. Average is 1.8% with 0.5% trail so try and aim for that.

your talking to someone who thought IFA was the Irish Football Association your talking out of my comfort zone now, i lost interest and trust of financial advisers in the early nineties, when after realizing 1 year into a 5 year investment there was nothing in it, because of administration costs taken out first, do they not do a free consultation or a one off fee for advice?

thanking you in anticipation

uok

Mikeyorks

uok wrote: »

do they not do a free consultation

Most do. But that will mainly be devoted to assessing your requirements / attitude to risk etc. They're in business - so aren't going to peg out all the washing in front of you to see if you approve of the offerings?

But - as earlier. If you intend to take interest from savings - then your capital is going to erode with inflation. And, at current rates, your capital is then essentially going to halve over the next 10 years or so.

An IFA has access to products which, as Jem says, should allow you to take out 5% (as much, net, as you could currently get from any savings account) whilst increasing your capital, by a similar value, in order to offset inflation. And a lot of that is achievable by utilising their products allied to full use of your annual CGT allowance.

Your experience 'of the early nineties' may well have been from an adviser tied to one of the Banks / BS's? Avoid them at all costs ... and Google for an independent local to you. But one who specialises in investment .... you don't want a Mortgage specialist, for example!

jem16

uok wrote: »

your talking to someone who thought IFA was the Irish Football Association your talking out of my comfort zone now, i lost interest and trust of financial advisers in the early nineties, when after realizing 1 year into a 5 year investment there was nothing in it, because of administration costs taken out first,

Perhaps you went to a tied adviser at a bank rather than an Independent Financial Adviser. On £70,000, a 1.8% commission would only see £1260 come out in initial charges and could probably be made up in the first few months with decent advice.

do they not do a free consultation or a one off fee for advice?

Your first consulatation will be free as they have to disclose all charges before you enter into any business. However you will not find out anything in a free half hour consultation.

You can agree a one-off fee for advice if it suits you better. However in certain circumstances the commission route can be a better option as it doesn't incur VAT.