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lulu

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The estate of a relative has now all been sorted and apparently a cheque for £25K is in the post to me.

I am after some advice about what may be the best thing to do with the money.

I have used my ISA allowance for the year and savings rates are cack. I am torn between some stockmarket speculation or seeing if it will help me buy my own house to live in, I am fairly sure now that a mortgage company would love my business as I have a (relatively) secure job and now a fairly hefty deposit but I am convinced that prices are heading for a significant drop (I have been looking on Rightmove and some properties I could be interested in have been on the market now for 2 years! - cheeky offer time?)

What would you all do if someone gave you £25K tomorrow?

Obviously I am aware that this is an internet forum and I will research all my options myself before making a move, but there maybe things that I have not considered which may be a better use for the money - I dont really fancy leaving it in a savings account to be given the current rates and Zimbabwe style inflation - I have enough savings already doing that....

Thanks for any comments, I am open to suggestions

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Well, if you already have a hefty deposit I would look at putting the bare minimum of 10% in gold bullion, perhaps take a little punt on silver bullion too (but beware VAT and high margins - so it takes a decent market move to break even before profiting).

Others will say I'm wrong about gold/silver. In fact they've been saying that for the last 2 years. Only thing is I've been right the whole time. Not to say the price can't be a little volatile in the short term or that things can change.

I suggest a look on:

http://www.zerohedge.com

to get an idea on gold, silver, commodities, stocks and current world events. This site is good for looking at graphs/trends for all manner of commodities too:

http://www.infomine.com/commodities/

Oh yeah, here is a thread from a couple of days ago where HPCers were talking about their gold/silver investments and view for the future, I did a hefty post on their detailing the main reasons to hold it, recommend you give it a quick look:

http://www.housepricecrash.co.uk/forum/index.php?showtopic=160029&st=0&p=2905490entry2905490

In summary though:

1. Houses overpriced

2. Stock market almost near pre-crash highs with little economic justification for it (although when you print money anything can happen), not to say some stocks will be winners (like mining stocks).

3. Govt. bonds. Would you lend money to a man who was up to his eyes in debt without sufficient means to pay it back? Why would you the same for a country in the same situation?

4. Negative real interest rates on all savings accounts - In effect the typical bank should be advertising at least -3.5% rate!

Edited by General Congreve

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How much tax are you paying on your income?

£25k in a pension saves you up to £7.5k according to your tax rate. [1]

£25k in venture capital saves you an immediate £7.5k regardless of your current tax rate[2] and gives you a tax-free income stream to follow, while also supporting small businesses growth to become our future wealth-creators.

[edit to add] £25k paid into a pension fund actually becomes £31.25k in the fund, with a max tax saving of £9375 based on the same logic as [1].

[1] Based on £12.5k saved now and deferred to a £5k future liability, but that's a maximum that applies to very few in real life.

[2] Provided you have that much tax liability to save in the first place. If not, you could spread it over more than one tax year to get the full benefits.

Edited by porca misèria

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Well, if you already have a hefty deposit I would look at putting the bare minimum of 10% in gold bullion, perhaps take a little punt on silver bullion too (but beware VAT and high margins - so it takes a decent market move to break even before profiting).

Others will say I'm wrong about gold/silver. In fact they've been saying that for the last 2 years. Only thing is I've been right the whole time. Not to say the price can't be a little volatile in the short term or that things can change.

I suggest a look on:

http://www.zerohedge.com

to get an idea on gold, silver, commodities, stocks and current world events. This site is good for looking at graphs/trends for all manner of commodities too:

http://www.infomine.com/commodities/

Oh yeah, here is a thread from a couple of days ago where HPCers were talking about their gold/silver investments and view for the future, I did a hefty post on their detailing the main reasons to hold it, recommend you give it a quick look:

http://www.housepricecrash.co.uk/forum/index.php?showtopic=160029&st=0&p=2905490entry2905490

In summary though:

1. Houses overpriced

2. Stock market almost near pre-crash highs with little economic justification for it (although when you print money anything can happen), not to say some stocks will be winners (like mining stocks).

3. Govt. bonds. Would you lend money to a man who was up to his eyes in debt without sufficient means to pay it back? Why would you the same for a country in the same situation?

4. Negative real interest rates on all savings accounts - In effect the typical bank should be advertising at least -3.5% rate!

Thanks forthe links, I am going to take a look that them and see what I can make of it all.

I have thought about the whole gold thing and would view it as a serious long term investment - to be cashed in in 20/30 years at which point presumably it would have retained some of its value.

In a perfect world my above average salary and now significant deposit would be enough to secure something at least half nice to live in. It makes the decision even harder.

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How much tax are you paying on your income?

£25k in a pension saves you up to £7.5k according to your tax rate. [1]

£25k in venture capital saves you an immediate £7.5k regardless of your current tax rate[2] and gives you a tax-free income stream to follow, while also supporting small businesses growth to become our future wealth-creators.

[edit to add] £25k paid into a pension fund actually becomes £31.25k in the fund, with a max tax saving of £9375 based on the same logic as [1].

[1] Based on £12.5k saved now and deferred to a £5k future liability, but that's a maximum that applies to very few in real life.

[2] Provided you have that much tax liability to save in the first place. If not, you could spread it over more than one tax year to get the full benefits.

I am not sure what tax I am paying, I am definately not a high rate taxpayer.

I am not sure what you are meaning with paying it into a pension fund. I have a pension with my work are you meaning paying a lump sum into it or setting up a new scheme?

How would one go about investing in venture capital? Sorry if this seems like a silly question but I am not sure I understand what you are suggesting,

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I am not sure what tax I am paying, I am definately not a high rate taxpayer.

Then paying it into a pension fund is unlikely to be worth your while.

How would one go about investing in venture capital? Sorry if this seems like a silly question but I am not sure I understand what you are suggesting,

http://www.h-l.co.uk/investment-services/venture-capital-trusts

http://www.clubfinance.co.uk/Open-VCT.php

http://www.taxshelterreport.co.uk/

http://www.bestinvest.co.uk/investment-research/vct/

Note that it ties up your money for a minimum of five years, or you lose all the tax advantages and probably make a significant loss. And you wouldn't want to put all your eggs into that basket - though it's certainly more productive than sitting on a hoard of gold!

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Then paying it into a pension fund is unlikely to be worth your while.

http://www.h-l.co.uk/investment-services/venture-capital-trusts

http://www.clubfinance.co.uk/Open-VCT.php

http://www.taxshelterreport.co.uk/

http://www.bestinvest.co.uk/investment-research/vct/

Note that it ties up your money for a minimum of five years, or you lose all the tax advantages and probably make a significant loss. And you wouldn't want to put all your eggs into that basket - though it's certainly more productive than sitting on a hoard of gold!

Thanks for getting back to me again. I am pretty clueless about all this but will look at those links you provided. The more information I can look into just now the better.

I am arranging seeing a financial advisor but would like to go into it after looking into as many options as I can before I do so.

I think alot of research needs to be done into all my options. Buying a house is my goal and I just know that given my luck the day I buy prices will start falling properly :)

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  • 312 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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