What to do with a large sum of money

[edthedead]

Please forgive the vagueness. I am potential going to be receiving a large sum of money in the fairly near future, enough to pay off our mortgage, debts and then still have a fair chunk left over. I am also, potential, not going to be able to work to retirement age and will probably end up having to stop work at around 50 (8ish years time). If I do have to "retire" I should get a good pension even at 50.

I have some knowledge of investing from sometime ago but am after some other opinions.

I would plan to pay off the mortgage and debts since, if I do end up not working past 50 I don't want that pressure on my income, a decent pension immediately is not guaranteed. I am planning to put decent lump sums away for my children and start a regular monthly savings account for them while I am still earning. I am then thinking of putting a lump and monthly contributions into a sipp as it seems tax efficient and I can then get access to a lump sum and/or monthly income from 55.

The question is what to do with anything else that's left, some will go on an extension and alterations to our house, but there is still likely to be over 50k left. Ideally I would like something which is going to give capital growth over the short term and and easily be switched to give an income of necessary, and not too high risk!

I am in two minds about speaking to a financial advisor, I don't want to be paying them to tell me what I already know or can find out myself....

[trickywoo]

If you are 42 now you won’t be able to access a sipp until you are 57. Rule changed recently.

[Gallons Per Mile]

In that case you need to jump on to the intelligent money thread and talk to Julian or Nik over there. They'll give you a good idea of what you can do and it's all free of charge.

[edthedead]

trickywoo said:

If you are 42 now you won’t be able to access a sipp until you are 57. Rule changed recently.

That's helpful to know, is it the minimum age that has moved or is it a minimum time from investing to drawing?

[trickywoo]

edthedead said:

That's helpful to know, is it the minimum age that has moved or is it a minimum time from investing to drawing?

It’s the age. Anyone born after April 1973 or 74, it’s around that as I am on the wrong side late in 74, is affected.

[shopper150]

Will you need to keep some aside for any potential tax liabilities on the windfall?

[Sonie]

Premium bonds

[bitchstewie]

edthedead said:

Please forgive the vagueness. I am potential going to be receiving a large sum of money in the fairly near future, enough to pay off our mortgage, debts and then still have a fair chunk left over. I am also, potential, not going to be able to work to retirement age and will probably end up having to stop work at around 50 (8ish years time). If I do have to "retire" I should get a good pension even at 50.

I have some knowledge of investing from sometime ago but am after some other opinions.

I would plan to pay off the mortgage and debts since, if I do end up not working past 50 I don't want that pressure on my income, a decent pension immediately is not guaranteed. I am planning to put decent lump sums away for my children and start a regular monthly savings account for them while I am still earning. I am then thinking of putting a lump and monthly contributions into a sipp as it seems tax efficient and I can then get access to a lump sum and/or monthly income from 55.

The question is what to do with anything else that's left, some will go on an extension and alterations to our house, but there is still likely to be over 50k left. Ideally I would like something which is going to give capital growth over the short term and and easily be switched to give an income of necessary, and not too high risk!

I am in two minds about speaking to a financial advisor, I don't want to be paying them to tell me what I already know or can find out myself....

If I were you I'd be tempted to post on the Intelligent Money thread and get the benefit of the knowledge the IM team kindly offer in the hopes you might look to use their service.

My first instinct is that perhaps some financial planning might be beneficial around making the best use of wrappers and other tools.

I mean this kindly but £50K isn't a large sum to most financial advisors these days.

[Wacky Racer]

bhstewie said:

I mean this kindly but £50K isn't a large sum to most financial advisors these days.

This

Around £500pw for two years.

[edthedead]

Thanks for the replies! I have posted in the intelligent finance thread. At the moment its all a bit uncertain so am just after some general ideas really!

[AndyAudi]

Don’t mean to pry, but you’ve said “not able to work” & mentioned alterations/extensions. Do you have a need to future proof your living accommodation, this may be my priority.

[edthedead]

AndyAudi said:

Don’t mean to pry, but you’ve said “not able to work” & mentioned alterations/extensions. Do you have a need to future proof your living accommodation, this may be my priority.

Yes, and it will be a priority after paying off the mortgage and debts, even if the alterations cannot be done straight away I should be able to continue working for some years yet and the money saved not paying the mortgage etc should more than pay for the work.

[edthedead]

shopper150 said:

Will you need to keep some aside for any potential tax liabilities on the windfall?

No, it's not a inheritance or gift (neither is it a win on the lottery predicted by crystal ball!)

[edthedead]

Wacky Racer said:

bhstewie said:

I mean this kindly but £50K isn't a large sum to most financial advisors these days.

This

Around £500pw for two years.

I appreciate it isn't a vast sum, but it could be more (or less!), which is why I don't want to end up paying a fortune in fees for advise or management. Paying off the mortgage and other debts will free up a fair amount each month in addition to what ever lump sum is left so my question isn't only about the lump sum but also the on going monthly investment potential.

[Phooey]

edthedead said:

I would like something which is going to give capital growth over the short term

Us too

Get "short term" out of your head and aim for capital growth. Keep fees low.