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Gifted £50k. Want to do something sensible, but not sure where to go from here Watch

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    (Original post by Pipsico)
    Hiya

    A bit about me
    I have a stable well paying job and house with £175k mortgage paying 1.79% on a tracker (will soon go down after these Base rate cuts)
    No debts apart from £1500 on a 0% interest card until 2018.

    I plan to treat myself with £1k of it and then do something smart with it.

    Currently have it stuck in 2x Santander 123 accounts paying 3% pre-tax and the rest in Club Lloyds accounts.

    I know there are a few financially savvy people here so would be good to get your thoughts on what to do? Or is it best left where it is?
    I'm not a massive risk take btw, and don't have time to manage a portfolio of investments. As my mortgage rate is so low, it might not be worthwhile to pay it off.

    Perhaps I could go shared ownership in a house? or?

    Cheers!
    First, congratulations.

    As wiser people have said: your money should work for you, you're not working for your money - so, what do you want to do (in life)? Before you were gifted this money, you might have had (explicitly or otherwise) a set of goals and pots that you were saving money into, so rather than creating new pots, you now have the flexibility to fill them a little faster.

    Are you saving for retirement, how are your pension pots looking? Does early retirement appeal to you? Moving up the property ladder in the next five years? Starting a collection of classic cars? Around the world cruise? Your personal goals come before the goals that you set for your capital.
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    (Original post by Pipsico)
    Yeah true about the systemic risk - i guess with Brexit we can't really predict what is round the corner. I get that it's debt financing - cutting out the bank middle man - but i'll face a similar type of risk anyway with S&S ISA presumably? Though it's equity, the risk is the same but I just won't be rewarded as much as debt?
    The risk isn't the same. If you were to invest in a diversified index fund (personal favourite are the Vanguard LifeStrategy funds), these are pretty resilient - in a recession the value of these equities will fall, and people who sell will realise a loss, but you understand what the value of these shares are at all times. You'll continue to own them regardless of what value they have.

    In a P2P scenario, a not-inconceivable default rate amongst borrowers would eat into the margins of the P2P lender to the point where the might have to fund the consumer interest payments directly from their own contingencies. How long can that go on for? Can they liquidate their assets to keep this going? (Mostly taken from a decent Reddit writeup of the systemic risks in P2P lending.)
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    (Original post by TelAviv)
    Value of Bitcoin fluctuates rapidly and is liable to be stolen by hackers. It lost more than half of its value a few months ago over a few days.

    £50k could easily turn into nothing overnight
    What did I say?
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    (Original post by AperfectBalance)
    It is far to volatile to tell or make any real predictions. so no it is a terrible idea.
    6 months late but would've made half a million.
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    why dont you pay off say 40k of ypur mortgage. rates are due to rise this will save the most money
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    (Original post by Pipsico)
    Hiya

    A bit about me
    I have a stable well paying job and house with £175k mortgage paying 1.79% on a tracker (will soon go down after these Base rate cuts)
    No debts apart from £1500 on a 0% interest card until 2018.

    I plan to treat myself with £1k of it and then do something smart with it.

    Currently have it stuck in 2x Santander 123 accounts paying 3% pre-tax and the rest in Club Lloyds accounts.

    I know there are a few financially savvy people here so would be good to get your thoughts on what to do? Or is it best left where it is?
    I'm not a massive risk take btw, and don't have time to manage a portfolio of investments. As my mortgage rate is so low, it might not be worthwhile to pay it off.

    Perhaps I could go shared ownership in a house? or?

    Cheers!



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    'Buncha hookers and cocaine.
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    As warren buffett would say, if you nothing about investing and can't be bothered to learn, keep 90% in a S&P 500 tracker fund and 10% in cash.
 
 
 
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