Exciting inheritance! How to hold it?

[Lionessadmirer]

My lovely uncle has left me and my two brothers £450k each after inheritance tax (we have just sent off IHT400).

For my brothers this is life changing. And it means I won’t have to support them financially.

My husband and I have a specific long term financial ambition to do with our house. But until the time comes to action that, we don’t need the money. We are both busy working full time.

my uncle self-invested nearly all his money via hsbc and ii. Given what I say above, is the sensible thing to do the same?

lastly, how should isas be used here please?

thank you and please raise a glass to our uncle who lived well and died content.

You speak the truth. I think many financial advisors and investment firms make money from fear and analysis paralysis.

Of course, some people just don’t have the time or the inclination to learn how to manage their own money - and tax advice can be more or less complex according to your circumstances- but the idea that it’s impossible to learn how to do it yourself is just nonsense.

And the data supports the fact that in most cases, your investments will grow more if you’re invested in low fee, passive, global funds.

It’s completely unnecessary to spam someone with unwanted opinions.

To be fair, I just believe the poster was trying to help!

To hear you say
'My pension pot is fine, my investments are fine. I simply do not have time to manage a diverse portfolio with a variety of asset classes. It will definitely perform better for paying someone to manage it properly'
sets so many alarm bells ringing, because that sounds like exactly the sort of thing unscrupulous 'Wealth Managers' say to convince punters that they can't possibly manage this complex task themselves and need to hand it over to a pair of 'safe hands'.

So how much did your investments grow in 2025, after you paid fees? If it's less than 25% then a single HSBC FTSE tracker fund would have earned you more!

I am not putting nearly 2 million quid in a single HSBC tracker fund. Ok?

Now please just stop.

The OP does indeed say her uncle was lovely.

The original commenter says "you and your brothers are very lucky to have had such a lovely uncle who wanted great things for you all."

It's just completely fantastical made-up nonsense. How the fuck is she supposed to know that?

Do penny pinchers really not understand that many people are not motivated by maximising every asset they have? If I had two million quid, and a financial advisor grew it by 20%/£400k in a year, I would not give a shiny shite that I could have had more. How much is enough for you lot?

This thread is bonkers. We’re on the investment board!!!! Of course people are here to learn how to make their investments grow as much as possible. In what universe is that considered penny pinching?

You're not listening. Lots of people on this thread are saying there are many other goals besides maximising their returns. Emotional security. "Not that interested." "Find it all difficult to understand." More interested in the dead uncle than the money he left behind.

Even at a very basic level, risk versus reward means different people have different attitudes to what is a good investment. "People are here to learn how to make their investments grow as much as possible." Nope. Not everyone is.

Genuinely, if you have £2m, what is the benefit to you of having £20k more? £50k more?

Ahh you believe £20k means nothing to someone with £2mill - you are mistaken - every bloody penny is earned - raven by the uncle - why give it away?

Well, of course, it’s entirely possible that people are here to learn how to make their investments grow half as much as they might otherwise do. I would only hope that if they are doing that, it’s intentional and not through ignorance. That was the point I was trying to make earlier.

Mmm, I wouldn't. They take huge amounts of commission. Invest in some tracker funds with low fees.

Yup.

Premium bonds are an effective tax shelter for an easy-access contingency fund, but are a very poor investment. Average returns are almost always well below inflation, so the pot loses value over time.

Fair enough, and nor would I for our 2 million, but if you really have no understanding or involvement in it and don’t know what return on investment you’re getting then you simply can’t say it’s doing ‘fine’.
What is ‘fine’ ? Keeping up with inflation? Matching the bank interest rate? 10%?
FTSE 100 +5%?

IFAs have a target customer matrix and rich, stupid clients are their preference - easily led, with lots of money to lose and not too many questions asked. Often they are swayed by plush offices and client meetings in nice restaurants!

Wrong again. The ongoing advice is crucial.

what happens if laws change and the advice given five years ago now changes and they have nobody to turn to. Stop commenting on things that you have zero idea about and those talking about rebel finance, jesus, what happens when things go wrong in the markets, how do you find them or speak with them. You can’t.

this size if inheritance requires skilled, face to face advice and ongoing servicing.

do you nit get your car serviced because there is an annual cost?

All of your comments are completely valid and understandable. The problem I have is that financial advisors and wealth managers are the only profession who charge an annual percentage fee of the assets their clients have. Over a lifetime this ends up being a very substantial amount. For some this will be well worth it - for others less so.

Did you see my earlier post that dead investors are the best investors? If ‘things go wrong in the market’ and you are already invested in a low fee global fund, you should do precisely nothing, assuming you are a long term investor. If you aren’t a long term investor, being fully invested in the market probably isn’t a good idea due to its volatility.

Financial advisors who can give sensible tax advice and estate planning advice can be helpful as many people have zero knowledge of these matters, but those who charge high ongoing annual fees are not doing their clients a favour in the long run. The effects of this on growth are well documented. And the idea that they outperform the market is also a fallacy.

Yes I do get my car checked when it needs doing but I don’t pay ongoing fees to my garage in case I need their help. My mum is with Aegon who charge her thousands a year for ‘professional advice’ which for the last few years has been to stay in their actively managed fund (no shit Sherlock). This is in addition to the fund fees and the platform fees, by the way. This same actively managed fund has for the last five years provided slightly worse returns than the FTSE Global All Cap. And after their fees, she’s most definitely worse off which then compounds over the years, to add insult to injury. She won’t move because ‘they are professionals and know what they’re doing’.

. It astonishes me how many people happily give away control of their savings to people they have no real means of vetting or holding accountable.

Almost the whole point of using an IFA as a finance novice yourself is that they are accredited and insured and there ARE ways to vet them and hold them accountable. And you don't "give away control" to them, either. You give that to the funds and companies you invest in.

What are your fees?

The qualifications to become an IFA are astonishing low (first year degree level).
’Vetting’ is minimal - mostly address and identity checks.
Your plumber has probably studied longer than your IFA!
The ‘carefully managed’ portfolio especially for you is all smoke and mirrors. These days most IFAs use AI/software which quickly generates scenarios for you - it takes seconds! I know, because my DS is a software developer and helps code the front end UI. The same sort of scenarios can easily be generated in chatGPT.

But hey ho, if you want to give tens of thousands to an IFA because you believe you’re getting a specially curated portfolio, that’s your choice.

Who said I had no understanding or involvement? Who says I don’t know what my return is? I have never said any of this. I don’t use an IFA.

Now for the love of God, mind your own business.

I am not talking about the vetting to become an IFA, I am talking about your own vetting of the IFA you choose.

Personally, I preferred to use an IFA firm, though I was lucky enough to know and trust the owner, and the record of the company shone out like a beacon.

I'm not sure if I would use one these days with what is available but there's still a minefield out there for the financially naive who don't understand risk vs returns or what products are covered by guarantees and not.

I think for OP a planner may be a better bet than an IFA- One-off advice on her financial situation and how this inheritance fits into it rather than a percentage fee for investment advice. Unless I’ve missed it the only thing op has mentioned is a “a specific long term ambition to do with our house” - but nothing on how much of the money this will use or what she means by long term. Step 1 is surely to understand this and get the right framework worked out as regards cash/investments/everything else. Arguing about active v passive etc comes afterwards.

No, of course not, you probably use a 'wealth manager'. The reality is that the person managing your portfolio is a spotty 22 year-old in the back office with a CompSci degree, plugging numbers in and generating impressive-looking reports. And since those reports will never compare what had happened if you'd put it in a global index tracker and left it for five years you'll be over the moon when they tell you it's 'been a good year' and your portfolio has grown 15% (before fees are taken off, of course).

I'm not interested in whatever you choose to do, but I am interested in helping other MNers not be fleeced by by an industry than preys on nervous investors with modest, uncomplicated finances, with talk of personally tailored, active portfolio management!

Top tip - if you are going to get upset about posters prying into your financial affairs - don’t give financial advice because one follows the other.