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einsign
Original Poster
2,620 posts
115 months
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A friend is being left a cash amount of around £200k after the death of a family member. They could do with probably discussing with a good IFA or similar, or maybe not necessary?
Maybe pay down a large part of their existing mortgage, spread between ISA’s in different family accounts, invest in a business and keep some in a reasonably good savings account.
Any thoughts appreciated.
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marcosgt
6,187 posts
45 months
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House/Flat? Rent it out?
Income and appreciating asset.
M.
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pidsy
1,969 posts
26 months
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Pay off mortgage and debts, buy a property for BTL and a caterham for the drive.
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zygalski
1,030 posts
14 months
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How much to pay off mortgage & how old is the person involved?
If it's at all doable, get rid of the mortgage ASAP, in my opinion.
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einsign
Original Poster
2,620 posts
115 months
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pidsy said: a caterham for the drive. I am seriously pushing them for a track day car 
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einsign
Original Poster
2,620 posts
115 months
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zygalski said: How much to pay off mortgage & how old is the person involved?
If it's at all doable, get rid of the mortgage ASAP, in my opinion. 39 years old. probably getting on for £300k owing on mortgage, hence why I thought clear down a large lump but still have some to enjoy.
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raptor600
1,356 posts
15 months
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No brainer really - clear a big chunk - £170k? ...then get a car and go on holiday with the rest! 
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zygalski
1,030 posts
14 months
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I'd say clear at least 150k from the mortgage, unless they have an extremely well-paid & bullet-proof secure job, which I don't think exists in this day & age.
It just takes such a weight off to clear a large long-term debt at the age of 39.
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groak
3,254 posts
48 months
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Buy an annuity and pray you don't die?
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sidicks
3,231 posts
90 months
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groak said: Buy an annuity and pray you don't die? That would obviously assume that you wanted a guaranteed income for life...
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groak
3,254 posts
48 months
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sidicks said: groak said: Buy an annuity and pray you don't die? That would obviously assume that you wanted a guaranteed income for life... And it would also assume that you wanted your investment to be a 100% write off when you died (which is, of course, a crazy thing to want).
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sidicks
3,231 posts
90 months
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groak said: And it would also assume that you wanted your investment to be a 100% write off when you died (which is, of course, a crazy thing to want). Obiously you'd have a much higher income to compensate.
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groak
3,254 posts
48 months
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sidicks said: groak said: And it would also assume that you wanted your investment to be a 100% write off when you died (which is, of course, a crazy thing to want). Obiously you'd have a much higher income to compensate. Obviously. Much higher. So just out of interest, what was the average income from pension annuities purchased in 2011?
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sidicks
3,231 posts
90 months
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groak said: Obviously. Much higher. So just out of interest, what was the average income from pension annuities purchased in 2011? At the risk of repeating myself, the annuity rate for a 65 year old is 6.5%. Base rate is 0.5% 20 year government bonds yield around 3%.
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groak
3,254 posts
48 months
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Does anybody else know the answer to the questions sid is too embarrassed to answer?
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sidicks
3,231 posts
90 months
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sidicks said: At the risk of repeating myself, the annuity rate for a 65 year old is 6.5%.
Base rate is 0.5%
20 year government bonds yield around 3%. I'm not embarrassed to answer. I don't know the answer or it's relevance.
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sidicks
3,231 posts
90 months
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sidicks said: At the risk of repeating myself, the annuity rate for a 65 year old is 6.5%.
Base rate is 0.5%
20 year government bonds yield around 3%. A quick spreadsheet shows that buying a 20 year government bond yielding around 3.1%, and seeking income of 6.5% (to match that available under an annuity) would required increasing liquidation of capital so that, after around 20 years, you would have zero 'fund' left. Sidicks
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jdw1234
4,286 posts
84 months
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Why not pay £200k off the mortgage?
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einsign
Original Poster
2,620 posts
115 months
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jdw1234 said: Why not pay £200k off the mortgage? Because that would be too simple and dare I say boring!
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chibbard
681 posts
129 months
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einsign said: jdw1234 said: Why not pay £200k off the mortgage? Because that would be too simple and dare I say boring! As boring as it is, surely this is the most sensible thing to do. I don't know how people sleep at night with a 300k mortgage.
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