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Having just sold a property we are now faced with the dilemma of where best to deposit the proceeds of roughly £440k
I do not want to lock funds away in a fixed 5 year term account nor have them tied up in investments with huge upfront fees that I will struggle to recoup as I intend to use all or some of the money to re-enter the market late 2019. However some return on the capital would be preferable.
To make sure I have the protection of the FSCS is the only option to split the sum between 4 or 5 instant access savings accounts? These look to be a pretty poor investment at 0.5% to 1% on average and messy.
Am I missing a trick here?
Not advise but just sharing my experience.
Easy 5 to 6% returns with peer to peer or doing joint venture or angel investor for 1 to 2 years lock in.
Hi Mark,Nice problem to have!I regard properties as a Bank - the Royal Bank of [your name here]. Assuming that you do not have a mortgage on your own home which you could use this money to pay down, I would "store" these funds in a good quality coastal holiday let that you could also occasionally enjoy yourself, or offer to family and friends.Let the money enrich your life in an asset that is unlikely to depreciate like a standard BTL and that will also earn you some good income if you "buy right".If you are leaving the market for other reasons than you are waiting for a decline, then I realise that the above might not be helpful.See - War Chest - Where do you keep yours?
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Good idea Vanessa!
There are some good bargains to be had at Whitesands in Camber right now, I understand there are a few motivated sellers and the prices are coming down!
Are funds always locked in with peer to peer or does it vary between the various platforms? Have you heard of any of these going to the wall?
If you decide to go down this peer to peer route, I would advise that you start with only dipping your toes in the water.
£440k is a lot of money to lose.
Plenty of us are in a similar situation to yours. If we buy a property, we have to pay significant SDLT.
For the time being, I have maxed out my ISAs and split the rest between Bank accounts and getting approx 1.35% before tax.
I thought I posted, but doesn't look like it worked, so sorry if it's a duplicate post.
I've been going through a similar thing. Paying off debts and as TSR says, maxing out your tax free savings, Premium Bonds and ISAs is a good way to go. The Virgin ISA offers access to their lounges which is handy for meetings in London.
I have used Peer to Peer companies, and doing OK. I spread the risk by using a few of them, but also making sure I've got government guaranteed savings too.
If you sign up to LendingCrowd you should get £50 using this link (*Moderator note: Link removed as member has not passed probation*).You can also get £100 if you sign up to Ratesetter using this link (*Moderator note: Link removed as member has not passed probation*).I also use Crowd2Fund (*Moderator note: Link removed as member has not passed probation*).Next look at Notice Accounts, not fixed term accounts. I signed up to Raisin, but Oaknorth is another good one for notice accounts.Then re instant access, I've just signed up to Marcus, the account from Goldman Sacks.
I've just learned my membership is still on probation. If you want the links to get the bonus money, perhaps try to send me a private message.
I think you have to look long term
i know one thing Government will not encourage you to be a landlord
even if your bussinss model worked I’m not sure it will not be taxed more and more
just think of your stamp duty bill alone if your buying
it has been hinted tax will go up again
taxation and government policy is your biggest enemy in BTL if you can see this issue and you can see the nett returns you want bash on
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
You should talk to an Independent Financial Adviser (IFA). It is their job to pick up on your demands and needs delivering the best outcome.
They charge a fee but often a consultation, to see if you can work together is low cost.
Regarding some of the suggestions P2P can be considered high risk, be careful who you engage. A holiday let would tie his funds up & he wants to be "out of the market" for whatever reason - holiday let is just a change of tenure.
_________________________________________________________________________The above post is not financial advice, its often me rambling - passing time on a coffee break.If you are looking for the Best BTL Mortgage? Call the Specialist Team at Bespoke Finance._________________________________________________________________________
Thanks to all that replied.
Given the restraints i have put on the situation i think multiple instant access savings accounts is my only option for now.