I am about to inherit 150K. What's best to do with it? I am a house owner, no mortgage, and about10K of my own savings (ISA, BSoc, etc), no shares as such. Thought buying a small house/flat might be best & safest route, although aware of CGT if/when sold, or could pass it to the kids. I know I can (& maybe should) go get independent financial advice, but others' ideas would be helpful. I'm looking to retire in around 7 years time if that's relevant. Thanks for any advice
I guess that the first decision is whether to accept it or get rid of it at the outset. For example, if your estate is already over the IHT limit and you have no need for the money - and your kids are old enough and responsible - you could effectively give it them *now*. The safest way is via a deed of variation to the will so that, despite having been left to you, it goes straight to them and doesn't increase your IHT liability even if you were to die very soon.
If you *do* have a use for it - like improving your house, or moving to a better one, or if you fancy a few exotic holidays - then accept it but put it somewhere reasonably accessible. Buying another property is possibly a better long-term investment - but for whose benefit? As you say, it will be subject to CGT - and it will need to be maintained, and council tax and other utility bills etc. paid. And if you tie the money up in property, you won't be able to spend it on other things. If you would make a lot of use of (say) a holiday cottage, and could possibly rent it out when you're not using it, it could be viable.
I'm sure that others will be along with lots of alternative suggestions, but that's my 10 penn'th!
Speaking as a landlord, I'd avoid both residential and commercial property - it has risen rapidly over the past 5 years, is significantly above trend and as such offers poor value for money.
Getting independent financial advice is good as long as you double check it here before signing up to anything, as it's easy for people who understand personal finance to spot potential missselling. IFAs take a holistic view of your finances and might pick up things you haven't considered. When choosing an IFA, get one with a G10 qualification so that they can deal with inheritance issues at the same time. See . Whilst talking to the solicitor it's worth getting them to put in place powers of attorney at the same time, then you have everything set up at once.
Good holistic view here
Make sure that you're insured against life's disasters, but because you have plenty of capital, you can self insure to some extent, and have a large excess, using insurance just for major disasters. See
Equity investment returns -
TMF posters 11%pa dividend growth over 40 years -
TMF posters 9.5%pa return over 20 years -
TMF posters 11%pa return over 35 years -
I'd use and invest in one of the following, in order of personal preference -
High yield, buy and hold strategy High yield, change each year iShares FTSE UK Dividend Plus Jupiter Income Invesco Perpetual Income Invesco Perpetual High Income
You should be able to get an income of ~£6,500pa.
Have you missed any contributions to the state pension in the past 6 tax years ? Get a forecast from . Do you have any company/private pension provision ?
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