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where to invest

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hi i am 64 retired and have £100000 to invest low to medium risk that will give me an income any ideas please I have looked at investment bonds and isas but i am confused at to what would be best I have no mortgage and approximately another £80000 available cash in isas and bank account:confused:
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  • Lokolo
    Lokolo Posts: 20,861 Forumite
    Part of the Furniture 10,000 Posts
    Wow lots of money! Speak to an IFA I would suggest.

    https://www.unbiased.co.uk <-- find one at that site.
  • purch
    purch Posts: 9,865 Forumite
    Investment Bonds and ISA's are just the product that holds the Investments, not the actual Investments themselves

    Are you sure you are a Medium/Low risk investor ?
    'In nature, there are neither rewards nor punishments - there are Consequences.'
  • whu
    whu Posts: 23,461 Forumite
    10,000 Posts Combo Breaker
    do you want a monthly income?
    Keep the Faith:cool:
  • earlgrey_3
    earlgrey_3 Posts: 583 Forumite
    redwyno wrote: »
    hi i am 64 retired and have £100000 to invest low to medium risk that will give me an income any ideas please I have looked at investment bonds and isas but i am confused at to what would be best I have no mortgage and approximately another £80000 available cash in isas and bank account:confused:
    Hi Redwyno, I'm 61 and just retired - great isn't it? :)

    (Now I've got loads more time to think about all the investment stuff that I didn't have time for before and to waste my time on forums like these. ;) )

    I'd suggest the first thing you need to decide what it is what you need and/or want - i.e. how much extra income you need, if any, and what your longer term plans are.

    Talking to an IFA, or preferably a few, is a great idea while bearing in mind that they do earn commission from some investments and not from others. You need to find one you're confident is putting your interests before his own. The Catch 22 is that you need to know a little about investment before you can judge the value of the advice you get. A little healthy scepticism is useful.
  • redwyno
    redwyno Posts: 9 Forumite
    whu wrote: »
    do you want a monthly income?
    yes about £400.00 per month as my wife still works just to cover bills
  • redwyno
    redwyno Posts: 9 Forumite
    purch wrote: »
    Investment Bonds and ISA's are just the product that holds the Investments, not the actual Investments themselves

    Are you sure you are a Medium/Low risk investor ?
    yes because i want instant access to all incase of any future changes
  • earlgrey_3
    earlgrey_3 Posts: 583 Forumite
    redwyno wrote: »
    yes about £400.00 per month as my wife still works just to cover bills
    I think you're going to be pushed to get that return on £100K on a long-term basis with instant access.

    You could put it in a savings account and currently get over 6% gross, £500 a month before tax, but that could be whittled away with inflation in later years or if rates fall. You might need to settle for a bit less now to maintain the income longer term.

    Would all be a heck of a lot easier if we knew what the future held. :)

    <Edit> Sorry, I see that's 100K + 80K. On that basis, I'd be bothering a few IFA's and see what you think of them. If you're confident about it then do-it-yourself because no-one cares quite as much about your money as you do. It's a complicated time to invest at the moment but with hindsight it's also a lot better than having invested 12 months ago.

    My philosophy is always to watch management costs and keep them low because long-term they make a heck of a difference.
  • whu
    whu Posts: 23,461 Forumite
    10,000 Posts Combo Breaker
    redwyno wrote: »
    yes about £400.00 per month as my wife still works just to cover bills
    with the sort of money you are talking about i would look into seeing an independent financial adviser ie one who is not tied to any particular institution but can look at a variety of products- but if all you are looking at for the moment is monthly income you could consider a fixed bond say for a year - eg if it pays 6.5%gross and you are a lower rate taxpayer you will get 5.2% which on £100k is over £400 a month but you wont be able to get to the capital for a year which may not be a problem with your wife working/other money you have?
    if you dont want to tie it up for a year why not look at high interest paying savings accounts which pay monthly - same interest payments apply as my previous example except you have access to the capital although the rate of interest could go up or down
    bear in mind that over a long period of time the value of cash will go down hence it is worth talking to an IFA who can advise on longer term/tax efficient investments
    PS you might want to bear in mind the FSA scheme to protect £35k in each institution that you hold money so it might be worth splitting the money up
    Keep the Faith:cool:
  • purch
    purch Posts: 9,865 Forumite
    yes because i want instant access to all incase of any future changes

    Ok, so as a Medium to Low risk investor you are comfortable with the idea of having instant access to a sum of money 15-20% less than the original £100k if your Medium to Low risk investment falls
    'In nature, there are neither rewards nor punishments - there are Consequences.'
  • dunstonh
    dunstonh Posts: 119,633 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    PS you might want to bear in mind the FSA scheme to protect £35k in each institution that you hold money so it might be worth splitting the money up

    That 35k limit doesnt apply to investments or life assurance. They have better limits. Although its a bit of a non issue with fund supermarkets in reality as you diversify within the fund supermarket anyway.

    The things that need to be considered here are:
    1 - risk attitude. Low/medium needs to be placed in context. One persons low risk is another persons high risk. Saying you are low/medium is like picking a number between 1 and 5 to indicate your risk level without actually knowing the real risks involved. If you understand the risks you will be able to make a better judgement on your risk profile. I good IFA will help you understand the risks more.
    2 - how the money is invested. You will never get two portfolios the same. Investments are about opinions and there is such a wide variety of options available with a fair amount of overlap that you shouldnt expect to get the same recommendation on how its invested. As long as there is a strategy in place that matches your aims and risk profiles and the research is of good quality then that should be what you aim for.
    3 - Tax wrapper. This is the ISA or investment bond (amongst others) that you mentioned first of all. The UK has over 13 different tax wrappers. Many of which can contain the same investments meaning the only difference between them is tax, charges and how the maturity is dealt with. Some tax wrappers can be too expensive and although better on tax can be higher on charges. Others can be slightly worse on tax but cheaper. So, the research should include a comparison of the tax wrappers. The investment should not be compromised by the choice of tax wrapper (or provider).
    4 - Aims with your money both now and in the future. No point investing in a way that doesnt fit your aims.

    Risks are not just investment. You also have inflation. Sticking it in a savings account getting say 5% is simple and many will say safe. However, with you drawing that 5% as income then you are letting both the capital and income be eroded by inflation. £100k in the bank will be worth around £70k in 10 years time as far as spending power goes. Indeed, if real inflation is considered it could be as much as half. So, often you have to take some investment risk to give yourself some potential for gain on the capital value. You may be switching one level of risk with another.

    Investing also means longer term. If you want all of it accessible to spend on a moments notice then forget investing and stick with saving (although note the inflation risk mentioned above). Investments will zig zag and sometimes they may zag before they zig (just ask anyone that invested in 2007). You need time and if you dont have time then you shouldnt invest. Guaranteed options do exist but these cost more in charges (whether implicit or explicit). Some may not appear to have charges but they take things away (such as dividends) so that becomes an implicit charge.

    There is so much you can type/say on this subject that you can go on and on.....
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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