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.

When I was Attorney for my mother we had to invest her money wisely and safely. We had a mortgage rather than savings so had never had to think about finance. In the end we used a low cost platform (in our case Hargreaves Lansdown) to invest in tracker funds, and again via their platform, placed the rest in longer term and easy access savings accounts. Spurred on by our new found knowledge we also started placing any money we had left over at the end of the year, after any mortgage overpayment, into SIPPs. A small amount of googling (Martin Lewis, This is Money or HL itself) have guidance on what vehicles (ISAs etc) are available to protect money from tax. HL is very easy to use.

Paying off mortgage early is often the best form of savings as interest savings are tax free. When you need the money, if you don't have enough savings you can always remortgage.

Trackers, by definition, keep pace with markets rather than beat them, which suited us fine, and since we didn't need anything more sophisticated, didn't want to pay for a managed fund or a financial advisor.

FWIW we have moved some of our SIPP money from stock markets to money markets because of a concern that tech markets are over heated and that a market adjustment is due.

Exactly, I don’t understand the naivety of “but you have to pay people grow your fund for you” well yeah, but they are professional investors who will potentially grow it far more, and more quickly than dicking around with FB DIY.

£450k does not constitute ‘wealth’.

It would be a total waste of money to use a large financial services firm when they charge 3-4% in fees.

OP may want a one off session with an IFA but she should ensure they are truly independent and not attached to a brand as many of them are.

It would also be in her interest to do some independent research, there are many financial YouTubers (search for FI or FIRE), who have masses of expertise in this area.

Nobody lives forever and im guessing OPs uncle was elderly. By all accounts he lived a good and contented life, and perhaps not having children of his own, it would have given him a great deal of joy to make his nieces/nephews happy with money that uncle had probably worked hard for. Its a win/win, uncle died happy and his family had a nice windfall.
The bitterness and jealousy is looming large on this thread

To answer your 4 questions:
I was not excited to receive any of my substantial inheritances. I was grateful though.
I did not of course refuse them.
I did pass them on in a way I thought followed the wishes of the deceased, not that they had stipulated anything.
Respect was uppermost in my mind, thinking about it and broadcasting it to others was done with tact and care.
I can assure you that much thought went into every word.
Thank you.

We are company directors so we complete tax self assessments every year.

96% of actively managed funds do not beat the market - historical data tells us this.

Financial advisors make money off other people’s fear of making a mistake.

It is entirely possible to preserve and grow your wealth by investing in a global tracker index fund with low fees. This is not new or rocket science, it is widely talked about in financial independence groups.

I do think it's a bit different when you start off managing your own, small, pot, and then it builds up over time, from if you inherit nearly half a million quid and have never had anything other than a savings account.

I manage my own portfolio (goodness that sounds fancier than it is!) but I started off with a few hundred pounds, built that up to a few thousand pounds and so on. It's money that ultimately I could afford to lose at this point. I'm sure by the time I have half a million pounds invested I'll have a good lot of knowledge and be more than able to manage a big pot effectively.

But I would be pretty nervous if I inherited half a million pounds and then had to apply the same knowledge to such an enormous sum without building any experience up first.

I would agree that it's not necessarily the case that the OP needs someone to manage her funds for her, but I think a one off meeting might be a good idea given the amount of money Vs their current exposure to this sort of thing.

We recently inherited a similar amount from my incredible MIL and it’s all in investment ISAs through Rathbones. I really recommend them and it’s growing well. I agree with the PPP to go with a household name. Their customer service has been exceptional. All the best of luck!

How much money do you need to have to think giving away a few percent of your investment to a financial advisor is money well spent. If you don't have the ability, knowledge, or don't wish to acquire it, that's ok - you get to pay someone else.

“Wealth management” is simply what private investment management companies are called.

It’s not a waste of money to pay experienced professional investors to invest your portfolio optimally to maximise yield and long term growth rather than naively twitting about on YT.

@Strikethepower If you are making more money and growing your portfolio it’s worth it. Peace of mind for a start! We have a diverse portfolio and its wealth management in a broad sense.

This thread speaks volumes about some people on MN <searching for the green eyed envy emoji>
Congratulations OP, you and your brothers have been given a wonderful gift by a family member whose wishes are being fulfilled. I for one love to hear about happy outcomes such as this.

How much do you pay Rathbones to manage your investments? 1-2%?

The thing is everyone's investments are growing at the moment, some of my investments have almost doubled in a year, the silver investment I made in November is up nearly 40% - the market is going great guns, your investments are growing because the market is growing - the test will be how you'll feel when we move to a bear market - when your investments like everyone else's are losing value but yours are losing more, because you'll have the fee percentage eroding your investment further.

Quite rightly because a lot of people make financial mistakes as they have no idea what they’re doing - particularly on MN.

Global tracker index funds are only one of many different financial instruments available and you can request your company to utilise them in your fund.

If OP had a background in finance and was confident to manage her own investments - that’s fine, up to her. But if she were she would not be on here asking MN what to do with 450k.

Would be interesting to know what their fees are.

Plus we certainly don’t pay 3-4% every year!

It really is a waste of money but I see I am not going to persuade you.

Do look at Rebel Finance School before you do anything with the money. They have a free 10 week course you can work through on YouTube. At the end of that, you'll be much better informed to decide whether you need a financial advisor or not - and to understand their recommendations if you do.

The couple who run it (Alan and Katie Donegans) both got MBEs last year for services to financial education, so they are legit. There's no upsell or anything dodgy.

I would also have a look at Meaningful Money, Damian Talks Money. There are others too if you search FI or FIRE.

Personally, I've educated myself to a point where I feel very comfortable managing our pensions myself. After years of feeling very confused about the whole thing, it's actually not that difficult (albeit some aspects are more complex but they're mainly around planning re tax during the drawdown phase)

That why educating yourself is a great place to start. It means you don’t make stupid mistakes.

The impact of fees on compounding cannot be underestimated, it can mean many many thousands of pounds are lost in the long term.

OP mentions a house project so may not want to lock her money up.

So I would consider £100k in premium bonds. Tax free return and government guaranteed. £80k in ISAs by April, invested in global trackers if it’s more than 5 years until you need the cash, cash savings if it’s less than that. For the rest it’ll be hard to shield from tax while remaining low risk, so I’d stay simple and either go for a self invested account like your uncle or a cash bond.

Totally agree with this. PPs are being dismissive about YouTubers as if they’re all idiots but Rebel Finance School is excellent.

Katie Donegan is a qualified actuary and produces some excellent graphs and charts showing the impact of IFA fees on long term investment growth. It’s eye watering.

Peace of mind is worth everything - I wouldn't achieve that by letting someone else chose my investments.

Everyone is making money at the moment - the market is doing it for them. The market is making financial advisors look good and delivering them a lot of money in fees.

Average returns on the stock market are historically around 8-10% - whilst average global returns for 2025 were over 20%. That's a big hike!

If your wealth manager has been delivering annual returns well above the average global returns for any year you may well have found a diamond - but you'll have been very lucky because most don't.

If they are getting you around 10% at the moment - they are costing you a lot of money.

As others have suggested, please be careful about financial advisers and remember that, while "independents" aren't tied to selling one company's products, there's still the issue of some pushing those which pay the adviser most commission, regardless of its suitability

Be careful, too, since your brotther's been in a financial mess and what this might mean for his future expectations if he controls his own share of the inheritance

Otherwise, enjoy it ... it's what your uncle would have wanted

The Martin Lewis moneysavingexpert website is an excellent resource.

Professional advice may be useful - wish I'd paid for pensions advice - but our IFA was not great so we sacked them.

First thing is to have easily available cash for emergencies. Then you put 20k each into ISAs now and a further 12k each next year. I'd suggest tracker funds but depends on your attitude to risk. Government bonds rarely get a mention but can be useful, the MSE website will teach you about them.

Also consider if you can solve that home issue now rather than later.

As your brother's position is different you may want to consider recommending he purchase a property. It's a pity your uncle didnt leave it in trust for him but if all beneficiaries agree a deed of variation is possible within 2 years of death. You definitely need professional advice if considering that.