Help with investing my money please!

[redllamayellowllama]

I am in the very fortunate position of being about to inherit a fairly substantial amount of money. We are living in my Mum's place atm while she is living abroad, so do not currently own a property.

We would be looking to buy another property at the point at which I go back to work (September 2012), so in the meantime, want this money to work hard for us. We are adding to this amount on a monthly basis, saving what we can (between £500 and £1000).

I'd really appreciate some advice on this - we met with a bit of a shifty financial advisor and not sure I agree with what he's suggested.

TIA

Start by maxing out any tax-free options e.g. Cash ISAs. You can invest £5100 before April 2011 and the same again afterwards (per adult). If you only want to put the rest away for 18months or so then you should probably avoid any stock-market related options.... not enough time to recover in value should they drop short-term. Things like fixed 1 year or 2 year bonds might give you reasonable interest on your lump sum. National Savings are doing some good offers. Comparison websites would give you a good idea of rates for Cash ISAs, bonds and regular savings. And www.moneysavingexpert.com has some good tips as well. Good luck

If you are only wanting somewhere safe to put the money for a year or so before you buy a property, then check the personal finance sections of the weekend newspapers or moneysupermarket for their tables of best-buys for savings accounts and bonds.

If you'll need it back in September 2012, you could go for one-year fixed-rate building society bonds, and then shift it into other accounts for the next few months. Or find savings accounts with a notice period - they usually pay more interest than no-notice ones.

Remember to spread it around if you have more than £50,000 as you are only guaranteed up to £50k per institution if a bank or building society collapses. National Savings are also safe, but you have to look carefully and move fast to get the best rates.

And with building societies and banks, check every few months that you are still getting the rate you signed up for - there is a lot of sneaky stuff where they advertise a great rate to attract new customers, then gradually bring it down to a very uncompetitive rate.

If you want to invest long-term, find a genuinely independent IFA who charges a fee rather than taking commission - look on www.unbiased.co.uk/ for a fee-based one in your area.