If you were given £100K, what would you do with it?

[TooCautiousToBlowIt]

PIL have decided to give us £100K as they are worried about inheritance tax. No strings attached. (I know, they are wonderful!)

Only thing, is what do you do with the money? We don't want to just blow it. Nor do we want it to sit in the bank, eroding. Property is too risky these days.

What would you do?

have you a mortgage?

Put some into Premium bonds?

I would have a fwe mind blowing holidays and then would put the rest away and think about it!obv if you have a mortgage pay a bit off that You are really lucky enjoy it for the gift it is1

I would pay off the mortgagfe, if You don't have one then investing it would be a good idea. Or you could if you felt brave enough use uit to buy a property to rent out.

Pay off our mortgage. I would then put the monthly mortgage amount away each month for extra savings.

I would put aside £40000 in a very high interest account, because if your PILs die within 3 years, that would the the inheritance tax payable from the £100K. It does decrease every year after that.

Then with the remaining £60000, if that would pay off the mortgage, then I would do that. If not, is worth perhaps putting in a high interest account. Will yield approx. £3000 a year in interest in a 5% account. Would not do stocks and shares. Would not use as deposit to buy another property. But it would be there in case the market really fell and you were able to capitalise on reduced property prices as a long term investment flat, say.

I'd put it in trust for ds.

But then I have ishoos with being given money...

Well I would buy a house because am renting and sick of the paranoia, insecurity and not being able to change stuff in the house we live in.
Otherwise, the advice about socking away enough for the inheritance tax is excellent, and paying of some/all of your outstanding mortgage good. If your mortgage is paid off and you have no housing costs, it makes a huge difference to life no matter what.

Mortgage...

Pay for the building works we're about to have done!

Is it really only 3 years for the inheritance tax on the gift? I always thought it was 7.

hire a hitman for h.

Pay off mortgage....or if no mortgage, I would put it in property at some stage, keeping a close eye on what is going on, but bearing in mind the contingency for possibly needing to pay IHT if they die prematurely.

I would use some for a deposit on a house and the rest I would invest in wine, much much better returns than if you stick it into a ISA or other high interest savings account.

I thought all liability for IHT ended after 7 years, yes, but reducing after 3.

you'd still have lots left over ambercat! Hitmen aren't that expensive

Of course hopefully the inheritance tax issue would not arise. After 7 years I think that the tax against the money gift would be nil. But... is worth putting it aside if only because at least then, no matter what you have done with the remainder, you have a substantial nest egg accumulating interest.

After 3-4 years the rate of tax would be £30000 (80 oercent of 40 percent)
After 4 - 5 years would be £24000
After 5-6 years would be £16000
After 6-7 years would be £8000

After 7 years would be nil.

Pay off the mortgage.

Pay off mortgage, fix up our cananl boat, get new car as ours is beggared), have a holiday, put rest away for children.

Pay off the mortgage, and invest the rest in case of IHT issues.

Shame I read this thread, lol, you lot have just (theoretically) lost DH a new car, lol.

Is also worth bearing in mind that if you have self-assessment tax returns, there is a box where you have to declare interest from savings. You are taxed against that I think. So it may be worthwhile placing some of the money in the name of the person paying least tax (with a higher allowance).
DH is taxed at 40 percent. I earn less than £10000. We have been given some money lately and we need to work out (are seeing a financial advisor) whether it would be better to put the money in my name in terms of tax. We will see.

I'm hoping it is

Ah, thanks blu and pooka. At least I hadn't totally made up the 7 years bit.
Not that anyone's ever likely to give me stuff, so a bit irrelevant .

For me....

Pay off debts although it wouldn't touch my [gulpworthy] mortgage !

Would also put £10k in trust for each child (3 of)

Go on once in a lifetime holiday

Give some to charity
Have some decent holidays
Pay off mortgage/ other debt

Take advice on how to invest from an IFA who you can share you priorities with.

Pay 60k off the mortgage.

Keep the 40k in a high interest account, after 3 years start to spend the amount that I would no longer have to pay for IHT.