Cinnamon Posted October 8, 2011 Share Posted October 8, 2011 Oh my goodness. Totally unexpectedly,I have been left some money in my Grandmums will It is a very tidy amount,& when I have bought the things I deem necessary,I will have a chunk of about £10k left over. Does anyone know what is the most sensible thing to do with this amount? I would like to have it somewhere as a sort of cushion for us as a family......I don't really know much about savings accounts & so forth,so would love to hear some of your expert advice. I have only just stopped shaking - this was totally out of the blue..I hadn't even considered that something would be coming my way Quote Link to comment Share on other sites More sharing options...
Lavenders_Blue Posted October 8, 2011 Share Posted October 8, 2011 Gosh, how wonderful to receive such an amount of money so unexpectedly! I don't really know anything much about savings/investments etc either, but I wonder whether it would be a good idea to speak to a financial adviser? Depending on whether you feel you are able to lock the money away or not, you can get some much better rates than for a straightforward savings account, which have pretty rubbish rates at the moment. Quote Link to comment Share on other sites More sharing options...
chicken bark Posted October 8, 2011 Share Posted October 8, 2011 Interest rates are so rubbish at the moment but they get better the longer you invest it for. I'd look at some of the money websites and see which offers the best interest on a bond. Just think of all the hen houses you could buy.... Quote Link to comment Share on other sites More sharing options...
Space Chick Posted October 8, 2011 Share Posted October 8, 2011 I would say that with current interest rates you would be better off paying a chunk off your mortgage if you have one. Otherwise, you could look at ISAs as they are tax free (if you are a taxpayer), otherwise, look at long term bonds... Either fixed rate ones, or depending on how you feel about risk, look at investment ones. What a lovely thing to come out of a sad situation Quote Link to comment Share on other sites More sharing options...
Egluntyne Posted October 8, 2011 Share Posted October 8, 2011 Gosh, how marvellous. I thought this was going to be one of those jokey 'an uncle in Nairobi' type posts. How about an ISA? Quote Link to comment Share on other sites More sharing options...
Cinnamon Posted October 8, 2011 Author Share Posted October 8, 2011 Thanks for the advise - I am going to spend a day next week seeking out an ISA,I think. It is tempting to pay a chunk off of the Mortgage,but our mortgage is small anyhow, & I like the idea of having the money here,if it is needed. We are going to Kos next summer for 10 days of all inclusive wonderfulness,so I will be paying that trip off with my inheritance My Grandmum was a fantastic woman. As some will know,I lost my Mum a couple of years ago,so between my Grandmum & my Uncle (who is himself very ill) they set this up with what would have been my Mums share of Grandmums money,split between my brother,sister & I. It has come at a good time for all 3 of us. My Brother has a new woman & they are thinking of starting a family. My sister has just had her third course of IVF fail,she will now be marrying her partner & looking into other options to start their family. We are in the building trade & worried about the new financial crisis that seems to be on the horizon. As was said,a nice outcome from a very sad situation. Quote Link to comment Share on other sites More sharing options...
Couperwife Posted October 8, 2011 Share Posted October 8, 2011 have you had a look at the Money Saving Expert website, he might give you some ideas sorry about your loss but something nice coming out of it helps cathy x Quote Link to comment Share on other sites More sharing options...
WitchHazel Posted October 8, 2011 Share Posted October 8, 2011 Sorry about your loss Sarah. If you have debts (other than a mortgage) then it's financially better to get those paid off, as the amount of money you will be paying in interest is far more than the amount you will get in savings interest. If you have a mortgage, then you need to weigh up the figures carefully to see what sort of difference it is likely to make. Technically, it is still likely to be better to pay off the mortgage (leave a small amount so that they keep your deeds for "free"), but because the differential on rates is closer, you may want the feeling of security that having a lump sump availabe will bring. If you are looking at simply saving it (where the capital is safe, rather than investing it where the returns may be bigger but your capital is at risk) then the first thing to consider is using your full cash ISA allowance. Cash ISAs are just savings accounts where the interest is tax free. The benefit of them, if you can leave the money in there, is that the interest on the interest is also tax free. However, you can take your money out at any time, you aren't locked in. Savings Bonds are where you put your capital away for a fixed period, usually between 1-5 years. The longer you lock it away, the higher the interest rate you will get. Interest on these is taxable. In the current situation, it's a bit of a gamble locking something away for a long period, as interest rates are more likely to rise in the next 5 years than they are to stay the same or reduce. However, locking it away for a year would give you time to think about what you want to do - remember that it is locked away though. Sign up for the moneysavingexpert weekly newsletter, ig you aren't already, as that usually contains information on current best rates in savings accounts of ll sorts. Other websites are also good - but a lot of them promote based on the revenue they receive, so it's not alwaays easy to see what's best for you. If you want to go down the risk route, then you should speak to an independant financial adviser. Be aware though that although 10K is a lot of money to you, it isn't a lot of money in the investment world. That doesn't mean it isn't worth doing though. It depends on your attitude to risk. Take this weeks stock market fluctuations. If you'd be feeling sick that your 10K at the start of the week is only worth 8K today (or whatever the current figures are), then the stock market isn't for you. You really need to be prepared to put your money away for a very long time, and to block your ears to what goes on in the meantime as you have to remember that, whatever its notionally worth, doesn't mean a thing. The only thing that mattters is what its worth on the day you want to cash it in. Hope that helps Hazel Quote Link to comment Share on other sites More sharing options...
snowberry Posted October 8, 2011 Share Posted October 8, 2011 Yup, I put my 10k inheritance into medium risk shares; then the market dived & I think I was able to only recoup 3k Quote Link to comment Share on other sites More sharing options...
newcountrygirl Posted October 8, 2011 Share Posted October 8, 2011 Lovely news. If it was me and I had a mortgage I would look at putting it into a savings account where the interest goes to offset the payments. That way you have your money should you need it but while ever money is in the account it reduces your mortgage payments and the time left on the mortgage too. We did this and it was amazing how quickly it started to work for us. Quote Link to comment Share on other sites More sharing options...
Tutti Frutti Posted October 8, 2011 Share Posted October 8, 2011 I would look at putting it into a savings account where the interest goes to offset the payments. That way you have your money should you need it but while ever money is in the account it reduces your mortgage payments and the time left on the mortgage too. We did this and it was amazing how quickly it started to work for us. Totally agree, provided (1) your mortgage interest rate is higher than the savings rate (after tax or not, if in an ISA) and (2) set up costs/valuations aren't exhorbitant and cancel out any gain. We have one - so our mortgage is our overdraft (just a huge one!) so lump sums bring our overdraft down and reduce monthly mortgage interest payments but we can withdraw it again and go back up to our overdraft limit should the urge to buy a car/motorbike/holiday/Cube grab us That's lovely of your Nan and Uncle, such sad circumstances though... Quote Link to comment Share on other sites More sharing options...
Olly Posted October 8, 2011 Share Posted October 8, 2011 Can't improve on Witchhazel's advice above which is very comprehensive - just wanted to say what a lovely surprise, and I bet your grandmother would have been delighted to think of the pleasure this is bringing you and your family. Quote Link to comment Share on other sites More sharing options...
Goosey Lucy Posted October 8, 2011 Share Posted October 8, 2011 What a lovely surprise I'd suggest buying some Premium Bonds. You never know, you might be lucky! You could always get some for your daughters, then they will always be in with a chance and you are guaranteed to get back whatever you put in and if your numbers come up then woohoo! Quote Link to comment Share on other sites More sharing options...
patsylabrador Posted October 8, 2011 Share Posted October 8, 2011 Ok, so, proxy spending and ignoring the word 'sensible' in your post, I would visit/volunteer at an orang utan sanctuary. Quote Link to comment Share on other sites More sharing options...
The Dogmother Posted October 11, 2011 Share Posted October 11, 2011 Hazel's advice is excellent; my father always advises paying off any debts too. He's a retired FD and tax expert. Lovely gift though despite the sad news. Quote Link to comment Share on other sites More sharing options...
Cinnamon Posted October 11, 2011 Author Share Posted October 11, 2011 Yes,thanks WitchHazel & everyone else too. We are debt free,apart from the mortgage & I would rather keep the money handy somewhere than pay a chunk off at the moment,so am looking into ISAS. We have never really had any money behind us before,well no significant amount anyhow,so it will be really nice to have this cushion. I am tempted to get the patio re done next spring,which will be a couple of thousand though.................we spend a lot of time in the garden & our current patio,although large,doesn't make the best use of the space & is also falling apart. It would be lovely to have perfect,flat,level sandstone down & a large,useable area for us to be...a bit like another room but outside,really I am sure it would add value to the house too. Quote Link to comment Share on other sites More sharing options...
chickencam Posted October 11, 2011 Share Posted October 11, 2011 We inherited a similar amount about 5 years ago from OH's Nan and we put 10K in premium bonds, we have had one win of £500 ( which went towards our Eglu) and the rest have been £50 or £25, we have probably lost a little over interest rates but there isn't much in it and we always have that tantalising chance of a big win. Quote Link to comment Share on other sites More sharing options...
Seagazer Posted October 12, 2011 Share Posted October 12, 2011 I have no financial advice to offer but just wanted to say how lovely for you and your brother and sister Quote Link to comment Share on other sites More sharing options...
freddie Posted October 12, 2011 Share Posted October 12, 2011 Do consider an offset mortgage, as you can use the capital anytime, as the capital remains accessible, but you dont get interest, But, you pay off pure capital from the mortgage, rather than any interest. You need to keep the savings capital in line with what you owe on the mortgage, though, as otherwise it just sits there not earning anything. thats a not very clear explaination, but we've got one, and it allows you to chunk all mortgage off the mortgage, not paing any interest for the mortgage, so it brings the mortgage down ever so quickly. And mort rates are still higher than saving rates% wise. I always go for safe investments if I have any spare £, as it's so hard to earn, and so quick to lose. Isa rates are not brilliant at the moment, so do double check against other saving rates, even with tax to be paid on them., as sometimes it works out more still! Sorry to hear of your Gran, but what a thoughtful lady, to adjust everything so kindly, bless her. Quote Link to comment Share on other sites More sharing options...
Chicken shack Posted October 12, 2011 Share Posted October 12, 2011 We paid off the mortgage with our legacy left by my parents. It was the best thing we ever did. Even the banks are not safe these days. I would always pay off depts first. Quote Link to comment Share on other sites More sharing options...
