What To Do With £100k??
Discussion
So first off this is currently a hypothetical situation although In the next few months has the potential to become a reality!
We currently live in a small house in the countryside in Somerset, an opportunity has come up through work for me which might see us move out of the UK. In our new place of residence we would be renting which would leave us with our house in Somerset.
Now neither of us have a pension or any particular savings of our own, we have bonds and trusts set up for our daughter. After fees we would come out of the house with about £100k equity which we would want to use wisely.
I am not after ‘financial advice’ perse, but in my mind we would do well to put down say £20k on two buy to let new builds and rent them out and put the remaining £60k away somewhere?
Is this a sensible line of thinking or does anyone out there think we should use it a different way? We feel we would like to keep a foot in the UK housing market ‘just in case’ but not fussed if that’s a little two up two down that’s been rented out for a few years.
Always suffered ribbing from my father in law for my view of ‘live for the moment’ ethos on life, so would like to throw him a curve ball and do sometning sensible for once that would be beneficial for us. I did wondered about buying a place and putting it in trustc for our daughter later on in life (she is 8 now) 10 years down the line this could prove a shrewd move?!?
Si
We currently live in a small house in the countryside in Somerset, an opportunity has come up through work for me which might see us move out of the UK. In our new place of residence we would be renting which would leave us with our house in Somerset.
Now neither of us have a pension or any particular savings of our own, we have bonds and trusts set up for our daughter. After fees we would come out of the house with about £100k equity which we would want to use wisely.
I am not after ‘financial advice’ perse, but in my mind we would do well to put down say £20k on two buy to let new builds and rent them out and put the remaining £60k away somewhere?
Is this a sensible line of thinking or does anyone out there think we should use it a different way? We feel we would like to keep a foot in the UK housing market ‘just in case’ but not fussed if that’s a little two up two down that’s been rented out for a few years.
Always suffered ribbing from my father in law for my view of ‘live for the moment’ ethos on life, so would like to throw him a curve ball and do sometning sensible for once that would be beneficial for us. I did wondered about buying a place and putting it in trustc for our daughter later on in life (she is 8 now) 10 years down the line this could prove a shrewd move?!?
Si
Thanks all, appreciate the ideas and suggestions. In terms of where we are going it will be Jersey if we go, not sure if their tax implications on UK held investments?? Something to look into.
The house we currently live in is in a desirable village however I wondered if the £100k could work better elsewhere, if it’s just as useful staying where it is then that has to be a strong contender, after all to get that £100k we will have to pay almost £20k in fees to sell the house.
Just want it to be as productive for us as it can be.
Si
The house we currently live in is in a desirable village however I wondered if the £100k could work better elsewhere, if it’s just as useful staying where it is then that has to be a strong contender, after all to get that £100k we will have to pay almost £20k in fees to sell the house.
Just want it to be as productive for us as it can be.
Si
red_slr said:
Err, what else would it be?
Anyway... at that age I would be considering your future retirement plans. You say you have no savings or pension.
I would consider splitting the £100k 3 ways.
1.Emergency fund. 3-6 months outgoings. Easy access something like NS&I is ok. 123 account might be suitable but you would need to have the minimum activity levels to get the 1.5%.
2.SIPP. You can invest the cash into a low cost SIPP one for you and one for your wife. This would lock the money away till you are 55. If it were me I would do £25k each so using another £50k. I would also set up a small contribution each month to keep it growing.
3. S&S ISA. With the last c.£40k I would full your 19/20 ISA which is £20k each. Low cost fund like VLS.
The ISA would grow tax free. In 20/21 if you had some spare money you could stick it in there and keep it growing.
If you were not happy with locking money away till 55 then you could do £40k into ISA now and £40k in April.
As for buying houses to rent out, its possible but from the sounds of things being a remote landlord with high LTV might not work out well.
Thats really helpful thank you, some great suggestions worth exploring and I am not averse to locking my money away till later on in life.Anyway... at that age I would be considering your future retirement plans. You say you have no savings or pension.
I would consider splitting the £100k 3 ways.
1.Emergency fund. 3-6 months outgoings. Easy access something like NS&I is ok. 123 account might be suitable but you would need to have the minimum activity levels to get the 1.5%.
2.SIPP. You can invest the cash into a low cost SIPP one for you and one for your wife. This would lock the money away till you are 55. If it were me I would do £25k each so using another £50k. I would also set up a small contribution each month to keep it growing.
3. S&S ISA. With the last c.£40k I would full your 19/20 ISA which is £20k each. Low cost fund like VLS.
The ISA would grow tax free. In 20/21 if you had some spare money you could stick it in there and keep it growing.
If you were not happy with locking money away till 55 then you could do £40k into ISA now and £40k in April.
As for buying houses to rent out, its possible but from the sounds of things being a remote landlord with high LTV might not work out well.
The people who have also made the point of letting our current property out until we have settled is a really good point, it also gets past Oct 31st as I am not really sure how that is going to affect things.
Si
I think my initial thoughts after all the pointers is that we will rent our house out for first 12 months or so. We live in a small village in Somerset which is very popular and lots of people moving in to benefit from local school system.
The rental would more clear the mortgage and it gives us a chance to settle and see if the new life is for us. I can then review it in 12 months time and see where we are at. Lining the pockets of solicitors/estate agents to the time of £20k doesn’t really appeal especially as it means we take a foot out the UK housing market.
Certainly loads of good ideas and things to consider that I hadn’t thought of. In terms of our existing mortgage then, we need to check to see if they (Nationwide) will allow us, if they don’t is it then an altogether new mortgage or will we just have to change our product??
Si
The rental would more clear the mortgage and it gives us a chance to settle and see if the new life is for us. I can then review it in 12 months time and see where we are at. Lining the pockets of solicitors/estate agents to the time of £20k doesn’t really appeal especially as it means we take a foot out the UK housing market.
Certainly loads of good ideas and things to consider that I hadn’t thought of. In terms of our existing mortgage then, we need to check to see if they (Nationwide) will allow us, if they don’t is it then an altogether new mortgage or will we just have to change our product??
Si
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