To be shit scared of taking a big step?

[Eeksteek]

I don’t know if I’m making a terrible mistake, but I have decided to sell up and start over, and I’m terrified it’s the wrong decision.

DH went and died and left me with student buy to let property, and no life insurance. It’s always served us well, but a combination of it being more difficult and expensive to finance now, covid making it difficult to let and a lot of banking errors mean I’m just going to give up on it. I’ve been fighting for years to try and make it work, but it just isn’t, and I can’t see it improving. I’m frustrated, sad, angry and scared, but mostly I’m utterly worn out over it.

I have no idea what I’ll do now. None. I’ve always done student lets and healthcare. And now I can’t do either and it’s a bloody terrifying prospect! I feel like I’m being wet and pathetic, but I could sure do with a bit of handholding (or even someone to talk to!)

Sorry I can't give out any advice as never done anything like that before. I hope someone else in her will be able to help you. I do hope everything works out for you, make sure you invest in some self care.

I've no experience of this either, but if it is causing you anxiety then it is definitely a good idea to offload it. And starting again can be a positive thing, although I'm guessing that after a huge bereavement like that, it all feels scary. One step at a time....and the very best of luck to you.

I think you’re right to get rid of it. You are getting rid of a complication in your life.
Are you needing to invest the money for an income ?

I would like an income, but I know nothing about investing and I’m not very comfortable with it. I feel the same about working in the real job market - it all feels incomprehensible. (I’m not grieving, just a bit clueless about investing and things seem have moved on a lot since I last worked outside of the NHS, which it’s own special world, and not one I want to go back to even if I could)

Good for you @Eeksteek. sometimes it’s good to take control, and not let something drift on when you know deep down it’s not right.

it’s hard to comment more specifically without knowing a bit more detail - ie do you have your own home as well as the student let? Are you planning to relocate? But if you’re not happy sharing more info, on a general level I’d say go for it.

so sorry for the loss of your DH.

I wouldn’t be happy investing money personally, I don’t like the idea of ending up with less money than I put in.
I did read on MN last week about a bank account with 1.5% interest, which won’t make you a millionaire, but it’s better than a lot of accounts.

Yes, I have a home. It has a mortgage and I’ll be paying that off first for sure. I thought perhaps I might invest in solar panels and a heat pump and then even if everything else crashes and burns I’ll have heat, power and a roof, but I don’t think I’ll stay here for long enough to make it worth it. Eight years, I think.

There’s some equity in the houses, but not enough to keep us long term. I’m not grieving, I’m just at a complete loss about what to do now. I suppose I should be excited about all the possibilities, I’m sure lots of people would love to be in this financial position, but I just feel lost.

I think letting it drift on really would be a mistake. I do think it’s the right thing to do. And I suppose I won’t have to rush into anything. But spending your capital on living expenses is really stupid and I’ll have to get my life together sooner or later. (And the tax implications are a bit bleak as well!)

it’s not like me to be so wet. I’m a real independent fighter, and usually have very clear ideas of what I want.

I’m sorry for your loss. Do you mind me asking when your DH died? ( you probably know the widows law of not making any big decisions in the first year)

My OH died suddenly (RTA) , horrific shock. We owned a couple of small let properties. I kept those for a few years but sold the last one two years ago.

Financial decisions are tough on your own and I can only advise take your time. A relative wanted me to follow advice from a financial adviser they knew, I just had a niggling feeling it wasn’t right for me. Later turned out his advice was terrible and I’d have lost thousands.
Take your time and keep life as simple as you can would be my advice.

Five years ago. Everything was fine (financially) at first, although I had a terrible job getting them mortgaged in my name. Then covid and poor lets, then more refinancing issues and now they just aren’t the good investment they have been for years.

I thought perhaps I would go back to work part time. But that turned out to be ridiculously complicated. I don’t have any clever business ideas. There’s nothing I’m especially passionate about or have always wanted to do. The student lets were perfect to keep me active, but not stressful and flexible around school holidays etc. they made a pretty average income, enough to pay the bills and have a uk holiday most years, which will do me fine.

But if I do that, won’t I be effectively guaranteed to lose, because of inflation? (Especially at the moment). It’s all so confusing!

Before you do anything drastic, have you considered if you might be suffering from anxiety and/or depression?

I think it's sensible to sell the rental property, there's no rush to decide what you need to do with the proceeds.
How much are you likely to be left with, and how much is the mortgage on your home?
Premium Bonds and National savings Bonds are risk free investments to put the money in while you decide.
I would recommend seeing a financial advisor as they can look at your overall position including pension etc.

Why don't you ask an estate agent if they will manage the student let's for you ?
The agency takes their cut
You still receive some income & the property should increase over time in value

Or ask estate agents 3, to value & sell

Sorry for your loss

It is definitely sensible to sell the rental property and invest the money. Pay off the mortgage if you can. Put some of it in a tracker fund to guard against inflation.

And then look for a job. Any job. Could be admin or schools or something that is low stress and gets you out of the house to meet people and get new ideas.

I came on this thread just to make that point. If you don’t invest, you end up with less than you put in because inflation erodes the real value of that capital over time. You can make appropriate investments for your circumstances and timescale on a risk profile that’s acceptable to you.

You could sell & invest the money in a person pension, then you would receive the tax relief, but you would not be able to access the pension money until 55 or 57 depending on your age

You may need to pay capital gains tax when you sell the BTL

You probably need to find a free financial advisor

That’s very thoughtful. I don’t think I am anxious or depressed generally, but I am anxious about this. It’s why I want out. I didn’t used to be, I’ve handled the lets for years. (It’s the finance thats causing most of the issues)

You probably need to find a free financial advisor

Honestly- I think you’re much better to pay a little for some independent advice. Then you get someone who considers all your options and isn’t just flogging one set of products to you.

The lets aren’t really a problem. It’s the finance side that has changed (well, they are a bit in that that there were no students through covid, and it’s not yet picked up. But student numbers peaked 2018, and I was beginning to see a slowdown pre-covid, so I think it’s an outdated business model. That’s ok, things change. Only I was very content as things were!).

I’ve been through several mortgage advisors. The market is just different now. I used to be able to get (relatively) cheap finance and good lets. Now I can only get expensive finance and lower lets. Financial advisors only want to advise on their funds. I’m not convinced managed funds are beneficial for me anyway, and I need much more general advice, not just ‘which fund do you want?’ Which is what I’ve had so far. I don’t know if I’ve had poor advice or I’m asking the wrong people or if that’s just how it is.

I think mostly I just need a bit of hand holding, (for which I thank the ladies of Mumsnet!). Not having a partner does mean I don’t have anyone to talk to about it.

I could. I will have to pay 18% capital gains tax on the sale of the properties, and then second home stamp duty on the new ones. To ‘flip’ rentals in that way would mean a huge tax bill. (I’m facing a tax bill whatever I do of, course). It’s the main reason I’ve held off so long - around fifty thousand pounds, I estimate. That’s a lot to lose!

Our house is pretty average. I suppose a small terrace would be a bit cheaper, but any savings would be very small when you take off the moving costs and stamp duty. It’s the best place for my daughter to be, and I’ll downsize when she moves out.

I think there will be about £300k, which sounds a lot, but bearing in mind it has to replace to DHs income, savings, pension and so on for life, it isn’t really (a widows pension only lasts 18 months now). Mortgage is only £80k, and no penalties to pay off July.

I haven’t found financial advisors very helpful. They have been upfront about being limited to which managed fund I want to invest in. I don’t know if I want to invest in a managed fund at all, and that seems to be all they do, which seems very narrow expertise.

I think you are probably right. I’m worried about that, too though. I’ve been out of the workforce for a long time, and while I don’t mind having to work (rental income is not passive, whatever people say!) the thought of having to deal with people all day, and the lack of flexibility…worries me. I socialise, do volunteer work and get out and about enough. I don’t want anymore ‘busyness’. I find it stressful in itself.

Your mortgaged property (your home)- do you have life cover as a requirement of the mortgage? Is it in joint names ?

I don’t recall if I checked our mortgage itself (I sold that property and bought a smaller one nearer to my family at the time). I doubt he did though. He thought buy to let was the be all and end all. I recall him cancelling separate life insurance, because he thought it was too expensive.