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tommyboy

Where To Stash The Cash

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Funnily enough, couldn't agree more  :D

Funnily enough, couldn't agree less :D

Spoken to a few people over recent years who've lost a damn fortune under the advice of so-called Financial Advisors. They are generally as greedy, untrained and immoral as Estate Agents.

My advice: Do you own research. Do your own thinking. Think of the investment risk you are prepared to take. Think about realistic returns and over what timescale you are prepared to invest. Spread your investments. And, above all, monitor your investments constantly, even if you decide to get a broker to do the daya-to-day running of your portfolio.

If all the above sounds like too much work, just buy a Ferrari F430 and a nice new girlfriend (although make sure you buy the car first...)

Nomadd

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My parents are in the exact same situation right now, though with not quite so much money.

I lent them the Motley Fool Investment guide. TMF favour index trackers if the money will be invested for 10 years or more. Recent performance of them hasn't been great I believe. Any thoughts on these anyone?

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My parents are in the exact same situation right now, though with not quite so much money.

I lent them the Motley Fool Investment guide.  TMF favour index trackers if the money will be invested for 10 years or more.  Recent performance of them hasn't been great I believe.  Any thoughts on these anyone?

I support investing in index trackers for 10 years plus. Index trackers like the stock market in general have actually been doing well in the last couple of years. But the best performances by far have been in the 101st to 350th largest companies (known as the FTSE250). The FTSEAll Share is very close in composition to FTSE100 but slightly preferable. I would stick 50% in FTSEAllShare index tracker and 50% in a FTSE250 tracker. This will give you a good spread.

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I was thinking of a basket of corporate bonds via a unit trust so the bonds would be continually changed by the trust manager as required.

'continually' - managers are not that active. Many are the laziest people you could imagine. Anyway it costs to make changes.

Even when they do so instead of 4.5% you'll get 4.65% - big deal. Deposit accounts have no risk - for comparison.

If, as our friend LRMS before quite rightly points out, if inflation takes off you're f***ed.

Why do you think govts are selling 50yr bonds at these rates?

Also, corp bond UTs (or OEICs these days) have been pushed by crap 'advisers' for a few years now as alternative to equities. What does that tell you?

Above someoe said FAs are crap - generally I agree. Not all! Most.

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What's wrong with corporate bonds ? They are a fraction up on the risk scale than just holding cash deposits but i have never heard of corporate bonds going negative. I think annual returns of around 7% per annum are typical.

Three words: Enron, Worldcom, Parmalat.

Thanks,

MoD

PS: my advice is that you should not invest in anything you don't understand. At the very least you need to know what the potential losses might be.

Acting on professional advice is no guarantee of success either, and I would not do so unless I understood the rationalle behind said advice. My experience is that it is right to be cynical about financial advisors' motives.

If you decide to go for safe investments then my suggestion would be to buy NS&I index-linked certificates and keep the rest on deposit.

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Not a financial advisor, but here's my tuppence worth;

1) Decide what their attitude to risk is

2) Decide what their investment period is

3) Decide what they want to get out of it (i.e. capital growth .v. drawing an income)

4) Do their homework, do lots and lots of homework. 160 grand is a LOT of cash. Consider all that may happen over the next few years e.g. recession, HPC, stocks devaluing etc.

Finally;

5) Don't put all your eggs in one basket (unless its a very very very safe basket)

FF

p.s. there's no such thing as a safe basket where cash is concerned.

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If you decide to go for safe investments then my suggestion would be to buy NS&I index-linked certificates and keep the rest on deposit.

Just had a look at NS&I index-linked certificates and they are £15,000 max per issue and for a term of 3 to 5 years so how do you suggest applying that to a lump sum of say £150,000 ?

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I support investing in index trackers for 10 years plus. Index trackers like the stock market in general have actually been doing well in the last couple of years. But the best performances by far have been in the 101st to 350th largest companies (known as the FTSE250). The FTSEAll Share is very close in composition to FTSE100 but slightly preferable. I would stick 50% in FTSEAllShare index tracker and 50% in a FTSE250 tracker. This will give you a good spread.

I'm a fan of these too but youre a bit UK biased with the above.

Also don't think these will work that well if the market goes down - think you may have to keep rebalancing your portfolio to take account of this.

QUOTE(penbat1 @ Sep 19 2005, 01:10 PM)

I was thinking of a basket of corporate bonds via a unit trust so the bonds would be continually changed by the trust manager as required.

FP has answered this one; think he must be a CFP.

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Just had a look at NS&I index-linked certificates and they are £15,000 max per issue and for a term of 3 to 5 years so how do you suggest applying that to a lump sum of say £150,000 ?

I did say and keep the rest on deposit :P

If he is married they can both invest 30k immediately. They can each put in another 30k each every time the interest rates change and there is a new issue. In the past three years it would have been possible to do this at least three times [ The limit increased in that time from 10k to 15k. The shorter term used to be 2years (rather than 3) but the interest was the same as in the first two years of the 5-year alternative ]. This suggests it might be possible for an individual to keep 90k in NS&I index linked bonds for a substantial proportion of time. Past is not a guide to future, etc ...

Whether he would want to invest so much with NS&I obviously depends on whether he pays HR tax.

Thanks,

MoD

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I know many on here have made this before, but I am amused at the fact that so many people on here appear to be FSA-authorised to give financial advice!

Like the recommendation about buying bonds - what if he did buy a sh!tload of bonds and then interest rates changed dramatically? Where would his comeback be? Nowhere, and whoever told him to do it would be legally culpable of misselling a regulated investment. 5 years in clink plus unlimited fine, hmmmmmm.........

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I know many on here have made this before, but I am amused at the fact that so many people on here appear to be FSA-authorised to give financial advice!

Like the recommendation about buying bonds - what if he did buy a sh!tload of bonds and then interest rates changed dramatically? Where would his comeback be? Nowhere, and whoever told him to do it would be legally culpable of misselling a regulated investment. 5 years in clink plus unlimited fine, hmmmmmm.........

allthough i will not follow any advice on here to the t, it will help me when looking at what to reaserch when looking where to invest this sum

thats is all i wanted a bit of advice,

dont worry i aint gonna come track u down in 5 yrs coz you have given bad advice

any decision that is made would be our decision and our fault if it goes tits up

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I am amused at the fact that so many people on here appear to be FSA-authorised to give financial advice!

Not convinced that's true

There are traders, tax people, accountants, probably mortgage brokers but I was thinking only a couple or 3 financial planners (advisers). I could be totally wrong

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The Norwich and Peterbrough are offering 8%, although I'm sure there must be some catch, like a maximum amount, although there was no mention of this in the basic small print... worth a look at though.

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Personally, I am relating experience (possiblty misremembered or misinterpreted), offering my (fallible) opinion and answering questions about factual information (possibly wrongly), and most importantly learning.  I don't ever give advice.  Everybody here must make their own financial decisions.

That's the kind of sig I mean. :)

---

IMHO

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  • 336 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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