Accidental Investment Opportunity?
Discussion
Due to an unexpected turn of events I now have a permanent extra income of £500 per month and also a small pile of cash I hadn't anticipated.
I'm initially tempted to simply filter the £500 off into a savings account each month and forget about it - it might be a nice rainy day fund, sometime down the line.
However, I don't "need" it and I wasn't expecting it, so I could equally throw it into shares or similar and see what happens...
Any other ideas on what to do with a constant £500 per month alongside a lump sum of £25,000?
Obviously I could simply buy a car / cars (this is PH after all...) but I'm thinking more along the lines of something cleverer, more financially orientated, as I am clueless on these fronts beyond my small (guesswork inspired) share portfolio.
Sterillium said:
Due to an unexpected turn of events I now have a permanent extra income of £500 per month and also a small pile of cash I hadn't anticipated.
I'm initially tempted to simply filter the £500 off into a savings account each month and forget about it - it might be a nice rainy day fund, sometime down the line.
However, I don't "need" it and I wasn't expecting it, so I could equally throw it into shares or similar and see what happens...
Any other ideas on what to do with a constant £500 per month alongside a lump sum of £25,000?
Obviously I could simply buy a car / cars (this is PH after all...) but I'm thinking more along the lines of something cleverer, more financially orientated, as I am clueless on these fronts beyond my small (guesswork inspired) share portfolio.
Personally, with interest rates where they currently are, I wouldn't be keeping too much in cash unless you are likely to need to access it in the near future (< 2 years).I'm initially tempted to simply filter the £500 off into a savings account each month and forget about it - it might be a nice rainy day fund, sometime down the line.
However, I don't "need" it and I wasn't expecting it, so I could equally throw it into shares or similar and see what happens...
Any other ideas on what to do with a constant £500 per month alongside a lump sum of £25,000?
Obviously I could simply buy a car / cars (this is PH after all...) but I'm thinking more along the lines of something cleverer, more financially orientated, as I am clueless on these fronts beyond my small (guesswork inspired) share portfolio.
Otherwise I'd consider a regular investment into a Stocks & Shares ISA - some sort of diversified global tracker fund to maximise equity exposure and minimise fees.
I'm not sure I'd be making a large lump sum investment into equities at current market levels.
If you've not got much in the way of pension provision, a regular payment into a pension fund (with a similar investment strategy) might be a better option.
(You would probably get more responses if this was moved to the 'Finance' sub-forum.
Edited by sidicks on Monday 2nd January 12:50
)It really depends on things like how old you are and whether the extra income pushes you into a different tax bracket. Plus how much your current pension contributions are, what your job stability is like, whether you have dependents and how much and what types of debt you have along with existing investments etc.
sidicks said:
megaphone said:
OP do you have a mortgage? If so look at paying some of it off.
May not be the best idea if the mortgage is currently on a very cheap rate!mike9009 said:
This is a debate I had in my head for sometime. In 2011, my mortgage rate was at 0.75% which made my payments incredibly cheap. I decided to take a strategy of making as many overpayments as was comfortable, on the basis that over the long term the rates would surely go back up again! So now in 2017 I have shortened my mortgage term by 9 years - but I could have invested all that 'overpayment' money in the FTSE and been better off!
I was aiming to pay off my mortgage in the next 3-5 years, but currently am happy holding assets which I expect to grow by more than the interest rate on the mortgage. As / when rates start to pick up, I will start to pay down the mortgage.sidicks said:
I was aiming to pay off my mortgage in the next 3-5 years, but currently am happy holding assets which I expect to grow by more than the interest rate on the mortgage. As / when rates start to pick up, I will start to pay down the mortgage.
I don't think you're alone. But the key will be to swap those assets for cash ahead of the herd. My general view at the moment is that that tipping point is the closest it has been since 2008 and the rate rises in the US will be a key driver this year and next. sidicks said:
....
Otherwise I'd consider a regular investment into a Stocks & Shares ISA - some sort of diversified global tracker fund to maximise equity exposure and minimise fees.
I'm not sure I'd be making a large lump sum investment into equities at current market levels.
...
Not sure there is much of a difference in exposure between direct equity investment and investment in funds which contain equities is there? Apart from the diversification I guess. But if the market tanks as a whole individual equities and equity funds will drop alike wont they? ThanksOtherwise I'd consider a regular investment into a Stocks & Shares ISA - some sort of diversified global tracker fund to maximise equity exposure and minimise fees.
I'm not sure I'd be making a large lump sum investment into equities at current market levels.
...
bmwmike said:
Not sure there is much of a difference in exposure between direct equity investment and investment in funds which contain equities is there? Apart from the diversification I guess. But if the market tanks as a whole individual equities and equity funds will drop alike wont they? Thanks
Yes - no difference.My point was about making a regular investment, hence averaging in to the market rather than making a lump sum investment at current (inflated?) levels.
sidicks said:
bmwmike said:
Not sure there is much of a difference in exposure between direct equity investment and investment in funds which contain equities is there? Apart from the diversification I guess. But if the market tanks as a whole individual equities and equity funds will drop alike wont they? Thanks
Yes - no difference.My point was about making a regular investment, hence averaging in to the market rather than making a lump sum investment at current (inflated?) levels.
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