£40k to invest, advice welcome

[Broaders]

Hi All,
I am in a fortunate position to have £40k to invest and although my heart says Audi R8 V8 Manual, my head says a number of funds over the long term would be a better bet.

I had started to look at various funds but I will admit it’s a little daunting.

My current thoughts are 4 X £10k invested in medium risk funds for the medium to long term. I don’t have an appetite for huge risk and I don’t envisage needing the money in the short term.

Any advice and gratefully received to assist with my decision making…

Cheers,
Broaders

[Broaders]

Thanks for the comment. Clearly a bit more context is required…
I was gifted £40k in shares by my mother as part of her inheritance tax planning. They sit in a share trading account. Looking at the history of the shares they have done very little in the long term and when Putin looked like he was about to invade Ukraine I decided to sell them. The balance sits in a share trading account awaiting investment.

From a tax point of view, I am maxing out my tax free pension contributions each year but little else.

Cheers.

[Welshbeef]

anonymous said:

[redacted]

You can simply drop it into cash ISA for now /as you decide which fund to invest in. This was your not time limited to choose before the end of 21/22 tax year.

[bitchstewie]

Getting £20K into an ISA this tax year make sense IMO.

As above you don't have to invest it you just need the cash in the ISA wrapper.

When you say "medium risk" do you have an idea of your tolerance for volatility?

If you start with £40K and check the balance what number would make you think "st" and want to sell?

[OddCat]

If the OP already owns shares he's already invested !

The shares you've been gifted are in what companies OP ?

[duckson]

OddCat said:

If the OP already owns shares he's already invested !

The shares you've been gifted are in what companies OP ?

He's sold them.

OP, you can pay the cash (£20k per tax year across any ISA's; cash, stocks and shares etc) into a Stocks and Shares ISA and hold it as cash if you are not sure which investments to pay into.

I would say a world/global tracker of some sort would be a good fire and forget, something like Vanguard Global All Cap or HSBC All world accumlation C for example.

[Welshbeef]

There is no wrong or right answer of where and how to invest

Investing in individual company shares is the most risky as clearly that company could fail and you have 100% exposure. (That said I certainly have plenty of individual stocks).


The challenge now is what’s the best way to invest during higher inflation and winning.

[Puppisadeer]

Drip feeding smaller amounts over a period of time rather than lump sums might work for you.

[jimPH]

Get it into an ISA now. Then decide.

[jimPH]

anonymous said:

[redacted]

I took it as the investment strategy, not the ISA deposit.

[Broaders]

Yes, ultimately I am look I guess for advice on how to invest the balance that sits in my share trading account. I don’t believe I have any tax implications as things are today other than the annual tax due above £2k dividends which I will not breach this year. I am not planning on taking any funds from the trading account so I don’t believe capital gains tax is due either.

[jimPH]

Broaders said:

Yes, ultimately I am look I guess for advice on how to invest the balance that sits in my share trading account. I don’t believe I have any tax implications as things are today other than the annual tax due above £2k dividends which I will not breach this year. I am not planning on taking any funds from the trading account so I don’t believe capital gains tax is due either.

No CG tax until the day you cash them in, which is why you should put it in an ISA. It's a no brainer, put it in an ISA, you have perfect timing to do it now so dont waste it.

[Puppisadeer]

jimPH said:

I took it as the investment strategy, not the ISA deposit.

Yes it was a response to the OPs query about investing in funds rather than maximising his ISA allowance.

[Simpo Two]

jimPH said:

Broaders said:

Yes, ultimately I am look I guess for advice on how to invest the balance that sits in my share trading account. I don’t believe I have any tax implications as things are today other than the annual tax due above £2k dividends which I will not breach this year. I am not planning on taking any funds from the trading account so I don’t believe capital gains tax is due either.

No CG tax until the day you cash them in, which is why you should put it in an ISA. It's a no brainer, put it in an ISA, you have perfect timing to do it now so dont waste it.

I have a friend in a similar situation. He thinks he has to sell the shares first, then re-buy in the ISA. Is that correct? But if you can just move shares straight across, then you could sell from within the ISA and thus shake off any tax liability you might have had when outside...

[jimPH]

Simpo Two said:

jimPH said:

Broaders said:

Yes, ultimately I am look I guess for advice on how to invest the balance that sits in my share trading account. I don’t believe I have any tax implications as things are today other than the annual tax due above £2k dividends which I will not breach this year. I am not planning on taking any funds from the trading account so I don’t believe capital gains tax is due either.

No CG tax until the day you cash them in, which is why you should put it in an ISA. It's a no brainer, put it in an ISA, you have perfect timing to do it now so dont waste it.

I have a friend in a similar situation. He thinks he has to sell the shares first, then re-buy in the ISA. Is that correct? But if you can just move shares straight across, then you could sell from within the ISA and thus shake off any tax liability you might have had when outside...

I don't know about moving shares across, but the OP (if I'm reading it right) has cash in a share trading account and he wants to know how to invest it, but doesn't think he's liable for any tax today (which he isn't), but he will be liable a few years down the line if his investments work out and he tries to cash it. The difference being he won't in an ISA.

[xeny]

Broaders said:

Yes, ultimately I am look I guess for advice on how to invest the balance that sits in my share trading account. I don’t believe I have any tax implications as things are today other than the annual tax due above £2k dividends which I will not breach this year. I am not planning on taking any funds from the trading account so I don’t believe capital gains tax is due either.

Move stuff into an ISA as quickly as you can without incurring CGT - less important to keep accurate records as you won't need them for a tax return, and if they CGT or Dividend rules change you don't have to worry..

With regard to what to hold - start from a basis of a whole world equity tracker as a default investment. If you want to diverge from that, have a logical rationale and write it down, so if it doesn't work out, when you're kicking yourself down the line, you at least know for certain what your reasoning was.

[Gtom]

Is it possible to buy Russian Rubles?

If you fancy a long term gamble, buy a grands worth and sit on them.

[SarlechS]

do we think the OP might want some suggestions on which funds to invest in for him to then research further?

[gotoPzero]

Dont hang about. Some share dealing accounts can take forever to send cash out. (3-5 days sometimes)

Open Vanguard ISA. Put £20k in before EOTY and £20k after as already said.
If it was me I would just dump the whole lot in VLS100.

HTH!

[andygo]

My wife is just about to recieve £20k tax free cash. She already has £20k in an ISA with Metrobank which is getting virtually nothing. Why should she put another £20k in when the return is less than 1%?