150/175k
stuart291155
Posts: 85 Forumite
Just in the process of relocating, have sold house and buying new property in August September, we have approximately 150/175k that we want to invest, know nothing about stocks&shares and really don’t want to invest in something with any risks. My wife has suggested we buy another property to rent out but never done anything like that before and not really sure of the pitfalls, any suggestions would be great
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Comments
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It's not clear from your post what the significance is of buying a property in August/September - are you saying that you need a home for £150/175K between now and then (prior to putting it towards the purchase), or is that money going to be surplus after that?
On balance it sounds like the latter is a more likely meaning, in which case it would be pertinent to consider when you're likely to need the money in the future, and what the rest of your financial circumstances are, e.g. savings, pensions, assets, etc....0 -
stuart291155 wrote: », know nothing about stocks&shares and really don’t want to invest in something with any risks.
Every investment carries risk unfortunately, it's all about thinking about your tolerance for how risky you want to be.
Even cash carries its own risk in the form of inflation. Inflation was 2.5% in March, so you'd need to find a savings account paying more than that after tax or else you will effectively be losing money.
Stocks and shares are generally considered to be on the higher end of the risk scale, as even if you invest in a (relatively less risky) index fund that reduces some of the risk by tracking a basket of shares rather than leaving your money at the mercy of just one or two companies' shares, can be pretty volatile, with falls of 5% or more over a week not entirely uncommon even when tracking the biggest and most "stable" baskets of shares.
Can you not split the money? Surely not all 175k needs to go into one type of asset? Diversifying is a good way of mitigating some of the risks because if one thing goes screwy, you have other assets that are not correlated doing their own thing.
I'm not a IFA or anything by the way, so take my words with the large pinch of salt you should reserve for advice from a stranger on the internet
Mortgage as of 31/05/2018: £229,454.00 :eek:0 -
It's not clear from your post what the significance is of buying a property in August/September - are you saying that you need a home for £150/175K between now and then (prior to putting it towards the purchase), or is that money going to be surplus after that?
On balance it sounds like the latter is a more likely meaning, in which case it would be pertinent to consider when you're likely to need the money in the future, and what the rest of your financial circumstances are, e.g. savings, pensions, assets, etc....
We have the money set aside for new property in August/ September and will have 150/175k left over from house sale to invest. Have approximately 50k in savings, I get a small pension of 3k per year at present and another one due in 2.5yrs of approximately 6k per year. No debts, credit cards loans etc. At present staying in temporary accommodation which is rent free. I’m 63 this year , we have no further assets at present0 -
Are you and your wife still in employment?
Are you still contributing to pensions?
Have you both obtained state pension statements?
https://www.gov.uk/check-state-pension
With regard to the proposed investment property, do you want to be a landlord with all it entails?
What makes you/your wife think this would be risk free?0 -
A buy to let property is indeed an option but it's not plain sailing being a landlord and it's less lucrative than it used to be as the tax treatment gets tweaked to be less appealing.
Keeping it in cash form in savings accounts may appear to be low risk, but, as pointed out by a previous poster, its value is likely to be eroded by inflation over time.
Investing (as opposed to saving) may be suitable - at least some of the money can be invested in funds oriented towards income rather than growth, in order to supplement your pension(s), if that's something you'd be keen to prioritise over long-term growth. Do you have no other income at the moment?
So, there are a number of options and it may be best to sit down with some Independent Financial Advisers to get some ideas about which will fit your circumstances and risk tolerance most closely....0
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