250k inheritance to spend but on what??

[TheMuminator2]

Came out of the blue from a relative we hadn't seen since we were young. Am tempted not to spend a penny and just invest

• Go on an amazing holiday/do something you've always wanted to do to celebrate getting the money.
• Give a donation to charity

Then think sensibly

• Pay off debt/mortgages
• Sort out pensions
• Open a savings account and lock away enough for a deposit on a house for any kids, for when they are older
• Keep a lump sum in reserve for emergencies, in a tax-free savings account.

Oooh.

I'd buy a smaller house outright for about £100k, with a view to doing it up (due to a new trainline, property prices are spiking in our area).

Put about £75k in a pension scheme, spend up to £25k on the house, and use the remaining £50k as income support so I could switch to a PT job and use the extra time trying to establish my writing.

Hello I am a prince in Nigeria. Unfortunately the government have frozen my assets. If you simple pay your 250k into my account I will have access to my riches and will immediately send you £1000000 😂😉

Sounds like magazine fodder to me too

Just booked a holiday to Tahiti and Antarctica were I will mull things over :)

Congratulations on your good fortune!

You've made the right choice, OP.

And I question whether so many people's first thought would truthfully be large charitable donations in the same situation.

Life is about security and happiness. Speaking from a much lesser amount, I feel you won’t have any regrets and satisfied if you do get some CDs and an account with stipulated investments. Best to speak with an accountant on that. This is only after you spend a reasonable amount on the main essentials if don’t already have. House and car. Pay them off or something you can pay upfront or pay most and payoff in 5 yrs. Not to rush but you never know what can happen these days.

Depends on your circumstances.

But please ignore the usual BTL crap. The person who said two properties paying £1200 income. Most of the income taxable. You have costs. 2nd stamp duty if you already own. Risk that the property is empty or bad tenants. Shocking liquidity - you can't sell a kitchen to raise enough to change your car. Gains are subject to CGT upon disposal.

I think another poster suggested that you don't put all your eggs in one basket re: shares. Good advice, but then in the same breath suggested you go all in on a BTL!!!! Amateurs, honestly.

A financial planner will cost an agreed fee, but if they stop you making a shocking tax inefficiency or save a reckless investment, you'll make up this fee tenfold.

Take your time and discuss with a reputable professional.

But please ignore the usual BTL crap. The person who said two properties paying £1200 income. Most of the income taxable. You have costs. 2nd stamp duty if you already own. Risk that the property is empty or bad tenants. Shocking liquidity - you can't sell a kitchen to raise enough to change your car. Gains are subject to CGT upon disposal.

This.

I'm really surprised by the number of people on MN who think that investing in real estate is risk free, always lucrative and easy. Government bonds are low risk and easy, not real estate. A broadly diversified stock index fund is a good hedge against inflation, but only in the long run and only for a portion of your net worth. I also agree with spending a bit on a qualified financial planner who can look at your entire situation.

Someone who has to come on a forum and ask how to spend £25k obviously has plenty enough wealth already. Stop showing off.

We were not well off before and I had no intention of showing off. Most people are into the spirit of the thread. Sorry if it made you feel offended.

Hopefully the advice can help many people here to make wise decisions about their future.

DH inherited about half the amount you did, but each of our DC’s inherited the same in their own right. We invested theirs through a wealth management company who also look after the IL’s investments which reduced the fees. Their investments are in a range of equities (UK and International), government and corporate bonds (UK and international) as well as a little in property funds, cash and hedge funds.

DH and I paid off the mortgage. I don’t care what anyone says about it being a ‘daft’ idea - it is so nice to be mortgage free. Our monthly income now seems to go so much further. We don’t have to worry about putting aside anything for the kids’ future and the mortgage money is split between long-term investment and holidays.

We weren’t expecting anything, but it has been a real blessing after a pretty horrible few years.

Enjoy it!

DH and I paid off the mortgage. I don’t care what anyone says about it being a ‘daft’ idea - it is so nice to be mortgage free. Our monthly income now seems to go so much further.

I agree completely, and it's only better to keep the mortgage and invest the money elsewhere if you have a risk free, certain return that's higher than the interest rate you're paying on the mortgage.

It's a minor thing, but the loan officer seemed a bit annoyed when I rang to tell her we were going to pay off the home equity loan, so that was a bit of fun. It's not often you get to annoy your banker.

If it was me... I'd pay off the mortgage, do all those jobs to the house I can't afford - loft conversion, bathroom/kitchen etc, put away an emergency fund, and fill LISA's in both my and DH names (I believe the government eventually plan to phase out state pension replacing it with this + auto enrolment) and book a holiday (nothing too fancy, just somewhere not in these 4 walls!)
Whatever you do, make sure you get to enjoy atleast some of it!

Oh, this thread is hilarious! Nice one, OP.

Me, I'd spend it on zillions of Vienettas.

ooh yum haven't ha da vanilla Viennetta in ages.

Just ot of curiosity what plastic surgery would people have? A bit shallow but oh well. Maybe a face life a vaginoplasty lol

It was me who said I'd buy to let, yes you factor in higher stamp duty but a flat that costs 90k in a good area that you know is easy to rent and gives you 1k income per month after putting aside £200 per month for repairs is not bad. I would also do it like my mum has for the last 15 years, no agencies involved and sorting out own repairs, it's saved her a lot of money and when she was undergoing cancer treatment I looked after it all for her so I know the work involved.

Yes the £1200 would be taxable but not that much as it would pretty much be my only income. I'm frugal so would be happy with 1k income considering I'm mortgage free.

I think a return of 600 per month on 90k investment is not too bad and I'm happy to pay cgt if I sell and if my estate is still under inheritance tax upper levels, my kids would gain.

Op I would go to a fat camp then have a breast reduction and a tummy tuck. But I probably wouldn't spend the money on that irl as I'm too frugal even with 250k in the bank.

@flirtygirl

Please could you give me details of where it is that a flat worth 90k has a rental value of 1k a month! I have a btl that is around 200k and is rented out at 800 a month which is considered a very good yield. But apparently I could sell it and buy 2 with 3 times the income! PLEASE share where this mystical place is!!!

I just reread your post.

So this 90k property would yield £1200 per month!!!

Wow!!!!

The reason for my sarcasm is that it is terrible advice and utterly unrealistic.

Pay off your mortgage and buy some premium bonds. Unless you know what you are doing other sorts of investments are too risky.

I wish this kind of thing would happen to me!

I'd upgrade to a bigger home in a better area for schools. If that's not relevant then pay off mortgage and any other debts.

I'd then invest in savings for my DC. I save what I can for them but it's not much and I'd love to be able to put a big sum aside for their future mortgages/other large expenses.

Sweet summer I'd say you have the perfect mix there!!

Good spread all around and ex mortgage money going too long term savings and holidays! .