Best way to invest £200k

[IntriguedUser]

I have ran into £200k, I will also be receiving some large amounts of money over the course of the next few years. For now I am ignoring any other potential money until I can see it in my account as I do not want to get ahead of myself.

I'm unemployed at the moment, do not own a house and live at home with my mum. Currently have £5000 in savings.

My goal is to eventually own a house, and have another property to provide additional income (I will have work then).

I want relatively low risk, so maybe investments isn't the best option, I'd like to at least cover inflation. Access to money not needed for 3 years.

Any advice?

Edited by IntriguedUser on Sunday 11th November 08:59

[henrycrun]

In the short term look at https://www.nsandi.com/our-products.

Readers will be along to advise on ISA or LISA.

[IntriguedUser]

Thanks. I will check it out

[JapanRed]

If your goal is to buy a house and have a second rental property then surely that’s what you should do with your £200k.

Where do you live? What would a suitable house cost to buy in your area?

[ymwoods]

Depending on where you are you could buy several C.40k houses to provide you a modest income from the profit of the rent (after costs) Use the rest as a deposit on a house for yourself.

[JulianPH]

His profile says he lives in London, so not much going at £40k!

[Hoofy]

Going on what others have said, if you're unemployed, I'm guessing you have plenty of time on your hands so buy a few properties in a cheap town and rent them out, your new business is to manage said properties.

[bitchstewie]

JulianPH said:

His profile says he lives in London, so not much going at £40k!

Just buy a bunch of slum flats in the North East or Scotland on a 20% yield.

That's the normal suggestion for "minimal risk" isn't it?

[anonymous-user]

IntriguedUser said:

I have ran into £200k, I will also be receiving some large amounts of money over the course of the next few years.

Probably worth establishing the origin of the money to understand your tax obligations as that could affect the best course of action.

For example, is the money relating to a payment for a product or service you have provided? Are you receiving it as a salary and so need pay a portion of it as income tax? Are you being gifted the money?

[IntriguedUser]

1. I live in London, so £200k won't be enough, I have been looking at places in Kent, and its still a stretch for something I want (off street parking/driveway) is a must.

2. The money has been gifted to me, are there tax implications?

3. Not sure on the suggestion of buying properties and running them as a business

A. I would lose my LISA bonus (spilt milk?)
B. When I do eventually want to buy my home, how easy would it be to sell these rental properties.

4. I am sure I am going to be receiving more gifts, but for the purpose of deciding what to do with this initial 200k I am not going factor that in.

[Hoofy]

IntriguedUser said:

2. The money has been gifted to me, are there tax implications?

Last time I checked, only if they die within 7 years.

[anonymous-user]

Why do you want to put money into BTL? Do you have property experience? Do you understand the tax implications? Do you realise there are high costs of entry/exit and an increasing burden of regulations? Will you need to pay an agent to manage it all for you? What's your plan if/when the tenant stops paying rent and tells you to get lost? What's your plan when the tenant moves out and takes the kitchen with him?

Either

• Buy a house with as small a mortgage as possible. Live in it and enjoy tax free capital growth.
• Get a job, enjoy your earnings.

or

• Continue living where you are and become a professional landlord.

[cat with a hat]

JulianPH said:

His profile says he lives in London, so not much going at £40k!

Couldn't even get a garage for that anywhere decent in London

[James_B]

If you are unemployed what do you plan to live off once your savings have gone? You won’t be eligible for any means-tested benefits now that you have so much money.

I’d stick the money into a few savings accounts until you are in a steady job.

[UpTheIron]

I think we need a little more detail to help with making some sensible suggestions...

How old are you?
You say you are unemployed... have you ever worked, or are you still of school/University age and not yet got your first job?
What sort of career do you envisage for yourself?
What is the relationship between you and the person/organisation that gave you the money (family/individual/compensation payout/etc)?
Assuming it was a genuine gift from an individual, how old are they and are they in good health?
How much time and effort do you have to manage whatever investment you choose?

[ymwoods]

cat with a hat said:

Couldn't even get a garage for that anywhere decent in London

Im in Stoke, bit cheaper up here! Many 2 up, 2 downs at 40k. Considered moving? Its also only an hour and a half on the train from London so you could potentially manage from there.

[jonamv8]

ymwoods said:

cat with a hat said:

Couldn't even get a garage for that anywhere decent in London

Im in Stoke, bit cheaper up here! Many 2 up, 2 downs at 40k. Considered moving? Its also only an hour and a half on the train from London so you could potentially manage from there.

this is the type of thing I was going to suggest

[IntriguedUser]

James_B said:

If you are unemployed what do you plan to live off once your savings have gone? You won’t be eligible for any means-tested benefits now that you have so much money.

I’d stick the money into a few savings accounts until you are in a steady job.

Thats a good question. I have been bys driving last 4 years, have left the industry due to knee problems and lower back issues. Truth is I dont know what to do at the moment. After 3 weeks my knee and back are back to normal.

To answer the other posters question

I'm 24, relationship to gift giver is close friend (43 and good health). I'm only educated up to GCSE level.

At the moment I have plenty of time to manage, have thought about going back to college/uni but have no idea what. Despite being sure of more future gifts I'm not going to bank on it, hence why I will not be moving out as with no job I wont be able stay afloat.

Its a shame you can only put 50k in the premium bonds account with ns and i. I suppose its a case of splitting the money to not exceed the 85k safety limit?

[Chestrockwell]

A friend gave you 200 grand, wow, I wish I had a friend like that

[Hoofy]

Chestrockwell said:

A friend gave you 200 grand, wow, I wish I had a friend like that

That's what I was thinking.