Personal Savings / Investment

[FlickStar]

Hi all,

I was just looking for some guidance on what would be best to invest personal money.

My husband is being made redundant and will get a good payout, but we want to keep the majority of this as a nest egg for our new baby & a house deposit for in 2 years.

What are our options - is it just some kind of high interest savings account?

thank you

[factor-fiction]

http://www.moneysavingexpert.com/banking/
When you have no regular income though you will find the money can soon disappear. I hope he gets a job before too long. He should claim JSA (CB)

[black_cat51]

having a big redundancy pot is great, but only any usee in the long term if you can find a similarly paying job quite quickly. If he is the sort of job that is in demand, great, but just don't pin hopes on having a wodge of cash in 2 years' time if you are going to have to spend it on living expenses

[bookbinder]

Go and talk to a financial adviser. That's what I did when I retired, and he put me on to an investment bond (which was not available to the general public, only to financial advisers, so I would not have been able to discover that it existed), which pays me a regular monthly income of £104.00, tax free.

[factor-fiction]

Is it tax free just because you're a non-taxpayer, bookbinder?

[bookbinder]

No, factor, it's not that, because I do pay tax on interest from savings. The details are lost in the mists of time, but the tax-free status of the £104.00 has something to do with the amount of interest that my investment in the income bond generates. If the amount that I receive every month does not exceed a certain proportion of the interest that the original investment (£25,000.00) generates, it comes tax-free. If I wanted a greater amount than £104.00, I would proably have to pay tax on that.

[factor-fiction]

Thanks BB. I expect anyone investing £25000 in a bond nowadays would get far less than you did. Anyway, £104 a month, is useful but it's no supplement for regular income and whilst it clearly suited you I'd not recommend tying it up in this way if there was any chance they would need to cash some in

[Tilly2]

Flick Star people might be able to advise you in more detail If you could respond to the queries.

[Tilly2]

Does he have another job lined up ?

[boxtops]

I'd put as much as possible in an ISA for each of you (£5640 each if you open it in this tax year) - no point in being taxed on the interest if you don't have to. Will he get a new job straight away, so you don't need to use any of his redundancy money for household bills?

[bookbinder]

I could always cash the bond in, factor, but I would (obviously) lose the income. The bond income is just one item among several sources of income that I have, and - just between you and me - my wife and I are doing very nicely, thank you. We're not rich, it's just that we're not big spenders, and we took out private pension plans when we were young enough to pay into them. Forward planning, you see. But, I am glad that I went to the financial adviser. I thought, beforehand, that he would laugh at me, because I didn't have a large amount of money in my pension pot, but he didn't laugh and he gave me some good advice. I would recommend going to an adviser as a first step. After all, if you don't like the advice, you don't have to take it.

[factor-fiction]

Yes, you seem to have a good portfolio to meet your needs , bookbinder. I think we need to know more about flickstars other income, savings and future pensions. If the amount is less than £50K I'm not sure it's worth paying for financial advice, but if it's say £100K then it should be invested in a portfolio, with different degrees of risk and accessibility

[bookbinder]

Yes, FlickStar, how about a comment?

[Peter Pedant]

yeah asking us should only be a last resort - none of us as far as I know are financial advisers...

[FlickStar]

Hi
Sooty - didn't get any notifications to say I had any responses - so hadn't checked until now! :-(

Luckily he has income protection insurance which kicks in after 2 months and that will cover is wages for until he gets another job, for a max of 12 months.

He will have no trouble finding a job, he has lots of good contacts in good places who have already given him some leads - so realistically - we don't see him being out of work for more than 4-5 months, absolute max.

Like you said, might be worth seeking a financial advisor

Thanks all

Xx

[FlickStar]

**sorry**

[dancecaller]

"....high interest savings ......."

What a joke. Like it was back in the 70s. You can't get an interest rate that keeps up with inflation - then they have the nerve to tax you on it.