What would you do with £50k?

[Wugglesworth]

Just that really. I'm going to inherit £50,000 and not sure what to do with it. No debts, have my own savings, no big spends pending. Do have a mortgage but we have two years left on our relatively low rate fix, and not sure I want to just sink it into that anyway.

What would you do with the money to get the best return?

Bank savings account/isa

Yes, you can expect around half of the the headline rate overall. Still a much better bet than Premium bonds if you want a guaranteed return on your money. You could have full holdings and still never win a thing, effectively eroding the value of your capital.

No, they don't. You may be lucky and win something every month or you could never win a thing. It's strange how it is always the go to answer from so many on this board. Investing money is generally done to gain good returns. Premium bonds are not consistently going to give the same return as even a basic cash ISA per year never mind a stocks and shares ISA over a longer period.

if not used ISA allowance trading 212 are offering cash ISA at 4.9% they also have a stocks and share ISA platform

This. Don’t do premium bonds!

I’d put it in my S&S ISA, invested in a low-cost passive tracker fund. I have a high risk tolerance and am investing for the long term though.

Definitely not premium bonds!

Pay off credit cards then put the rest in premium bonds.

Best return will be pension contributions due to tax relief so that's a no brainer if you don't need access in the short term. So £20K pension. £20K S&S ISA this tax year. Enjoy/spend £5K on a family holiday. £5K in next tax year's ISA.

Definitely not premium bonds. They’re rubbish. Get a stocks and shares isa and then buy yourself an amazing holiday or something

Definitely not premium bonds. They’re rubbish. Get a stocks and shares isa and then buy yourself an amazing holiday or something

Definitely not premium bonds. They’re rubbish. Get a stocks and shares isa and then buy yourself an amazing holiday or something

I’d put 20k in a stocks and shares ISA whilst it’s down. I’d put the rest in premium bonds. I’d stay clear of property, being a landlord is a nightmare.

Agree with the suggestions to get a higher interest current account as a quick win - but that’s unlikely the best place for you to keep all this, esp given your 6 months of emergency savings is instantly accessible. You will generally get higher interest rates in savings accounts where notice to withdraw is required. You could consider putting some of your emergency funds and/or your inheritance into one of these savings accounts to maximise interest.

This guide is a v comprehensive dive into premium bonds - noting the average rate of return is 4.15%: https://optimly.co.uk/guides/premium-bonds.html This isn’t guaranteed (although of course you might win big!) whereas if you put your money into a savings account with a higher interest rate you’ll know you’ll get that in returns.

This other guide also explains different types of savings/investment products and considerations in case helpful: https://optimly.co.uk/guides/save-or-invest.html

For me having max £50k in premium bonds comes in 3rd place after using £60k pa pension allowance and £20k pa S&S ISAs.

It is odd the PBs are often cited on here because statistically it’s the investment platform most likely to erode your money to inflation. I can only assume the advice is given by those lack even very basic investment knowledge.

Definitely not premium bonds! They don’t guarantee any return and the average return is really low. If you can put it in pension fund you will have the government add your tax to it. Also maybe keep some by for a treat.

I would buy a second property and use the money for a downpayment.

agree. PB a waist of space.

Until you figure out how you want to use it - £20k in a high rate Cash ISA and £30k in a high interest instant access account.

It’s a good time to invest in stocks and shares ISA or private pension. The markets are dipping so you will buy low. Long term you will gain.
DH’s draw down pension has given an overall return of over 20% over the last 3 years. He has a regular income from it but it’s still earning him money. It’s down at the moment but longterm he’s still gaining.