£200k to invest - what would you do ?

[darmstadt]

[GJABS]

I believe my retirement fund at the moment would pay for hookers, or cocaine, but not both. Which should I go for? (decisons, decisions..)

[Spoiler]

Well, you have to consider:

Length of the investment?
Tax considerations (would you like tax free income)?
How much risk vs reward?

Investment would be longer term, i.e. 20 years

At the lower end of the risk spectrum, so above ~0% risk (i.e. distributing it across FSCS savings accounts), but not 'expecting' to lose significant % of the capitol (i.e. property, the general expectation is that property prices increase over the long term).

Returns: More than 1.5% (Savings rate), less than 10% would be acceptable.

[northernladuk]

Investment would be longer term, i.e. 20 years

At the lower end of the risk spectrum, so above ~0% risk (i.e. distributing it across FSCS savings accounts), but not 'expecting' to lose significant % of the capitol (i.e. property, the general expectation is that property prices increase over the long term).

Returns: More than 1.5% (Savings rate), less than 10% would be acceptable.

So if that's the case and I was him I'd probably split it in to a number of different vehicles

Max out premium bonds for a few years (just because I've fancied having a go but never had enough 'spare' money to put in to this)
Decent sum in RateSetter and another like Zopa or similar
Max the ISA every year in a medium to low risk fund (possibly use any other family ISA if you can)
A lump in a slightly higher risk fund, possibly tech but be prepared to keep an eye on market crashes
Couple of terraced properties in a good area (low risk but not the most fantastic returns and go long term)

I think the spread of high risk which is doing OK would help bump up the fund with the steady returns from RateSetter, the house and possibly PB keeping it ticking over. In a couple of years the profit from all will give me enough of a buffer should the risker investments not pay off so averaging a lower figure that I would have been happier with.. Fairly standard risk spreading I think.

[Spoiler]

So if that's the case and I was him I'd probably split it in to a number of different vehicles

Max out premium bonds for a few years (just because I've fancied having a go but never had enough 'spare' money to put in to this)
Decent sum in RateSetter and another like Zopa or similar
Max the ISA every year in a medium to low risk fund (possibly use any other family ISA if you can)
A lump in a slightly higher risk fund, possibly tech but be prepared to keep an eye on market crashes
Couple of terraced properties in a good area (low risk but not the most fantastic returns and go long term)

I think the spread of high risk which is doing OK would help bump up the fund with the steady returns from RateSetter, the house and possibly PB keeping it ticking over. In a couple of years the profit from all will give me enough of a buffer should the risker investments not pay off so averaging a lower figure that I would have been happier with.. Fairly standard risk spreading I think.

Wow, bit of luck I was sitting down when I read this ... wasn't expecting a post as useful as this from you
Thanks

[northernladuk]

Wow, bit of luck I was sitting down when I read this ... wasn't expecting a post as useful as this from you
Thanks

Not sure why. You just commented on another thread I posted which is also half useful.

[Spoiler]

Not sure why. You just commented on another thread I posted which is also half useful.

Overly optimistic ?

[stonehenge]

There are ways to gain exposure to the residential property market without actually buying bricks & mortar.

Residential funds: buying houses without the hassle - MoneyWeek

May be worth a look.

[ChimpMaster]

Always invest for income, not for speculation.

For example, buy a property for rental income. You can buy a house and hand it over to a leasing company for 3 or 5 years (typically) and they pay you a guaranteed rent every month. You don't need to do anything on the house - they fully manage and maintain it during the term of the lease.

Stock market feels very overbought at this time so might be worth waiting for the next mini-crash before putting some in there.

I wouldn't bother with putting much into ISAs or leaving it in a bank saving account. Perhaps a small %, just to keep some powder dry.

I like the idea of splitting the £200k into several investments. Like £120k into property, £40k into shares etc.

[DimPrawn]

So if that's the case and I was him I'd probably split it in to a number of different vehicles


Decent sum in RateSetter and another like Zopa or similar
.

Be careful with these alternative ISA investments. They have zero protection. I would put them higher risk than shares or property. If there are a large number of defaults you lose your money.