The first thing to do is save for ~£5000 in a deposit account or something you can access immediately for an 'emergency fund'. From there, there are dozens of options that depend on many variables. What tax bracket are you in? How many dependants do you have? What pension do you have? Do you have a mortgage and if so what type? etc
£400 per month to invest - Where?
- Thread starter Draeger
- Start date
Soldato
But can you add £400 pm to your fixed rate ISA? I doubt it.
Soldato
Ashraf Laidi said:
If you stay here, get a fixed mortgage. In order to do so may involve using this 400 to reduce your LTV to within range of a very nice 10yr deal which personally I would want the risk of taking over variable rates
It puts you on the same side as HMG which issues bonds of fixed annual return, most likely it should profit vs variable but many prefer the fast pay route where they pay only 1% interest and chop the rest off the loan value.
The biggest cost of a house is not bricks or land, its the finance cost
Associate
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+1 YOU either have 50% chance to win or 50% to loose. So a lot of chance to win! No brainer really.
Soldato
Use it to buy a flexible leave anytime plane fare to a non-extradition country and put the rest into untraceable bearer bonds to keep under your mattress.
Just in case
Just in case
Is this a joke post?
Soldato
If you have a mortgage then absolutely this. It's the lowest risk/highest return on that sort of money.
Do your sums and you'll be shocked how much interest you won't have to pay to the bank.
Of course some savings can't hurt but you can always stop overpayments for a time if required.
Man of Honour
Mortgage off your shoulders is an amazing feel. Definitely go for that.
Soldato
[TW]Fox;24578464 said:
Lol yes premium not capital.
Banks insured to a degree but if they go arse about face your stuffed, the government however unless it falls will always have your money safe so ignoring a the base on return its probably the safest place for it to be.
Soldato
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Bricks and Mortar.
Soldato
It's not that the funds are crap per se, it's that people buy them for all the wrong reasons and, more importantly, usually at the wrong time. When did IP High Income and Miton Spec Sits balloon in size? When markets tanked. When did BlackRock G&G balloon? When gold prices peaked. Retail investors' investment decisions are overwhelmingly driven by greed and fear.
A selection of investment funds with a rock solid, repeatable and proven investment process that outperforms the median in both rising and tumbling markets has always been the way forward, rather than flavour of the month funds run by 'star' managers whose performance waxes and wains with market movements. Nobody wants to interview Neil Woodford when equity markets are soaring because his funds are third or fourth quartile, but as soon as equity markets have a wobble, hacks are clamouring to stick a dictaphone in his face and print every thought he vocalises.
Standard Life GARS (as much as I despise Standard Life) has been a solid performer and utilises just such a process to provide solid returns, although I find their stellar performance for a self-proclaimed 'absolute return' fund to be a little concerning. I actually think their 'MyFolio' range are better as they have better diversity whilst still maintaining a GARS allocation, although they're a touch expensive.
Jupiter's Merlin funds are also a good shout, they're old-school-multimanager expensive but then their performance in all kinds of markets suggests that they're not necessarily overpriced. The first couple of funds in SEI's range have an extremely efficient use of risk, though their more aggressive portfolios are actually very inefficient in that for a lot more risk, returns between the portfolios have been near identical.
My personal favourite, however, is Russell Investments. I've yet to find a complete range of portfolios that beat them across the board in terms of efficient use of risk adjusted returns, cost of ownership or returns across a whole market cycle. That being said, my pension is invested with them.
As somebody without a mortgage, does anyone mind explaining why paying it off early is so good? How are you saving money compared to paying into an ISA, for instance?
It'll be handy to know for if/when (hopefully!) I'm in the same position.
It'll be handy to know for if/when (hopefully!) I'm in the same position.
Associate
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Simple case of how much interest on the money you owe vs the money you make if you save it.
Say you owe £1,000 at 1% interest (Interest you pay to the bank)
But you are saving £1,000 in an isa at 0.5% interest (Interest you receive from the bank)
You have to pay more money to the Bank in interest than you receive so you'd be better off paying off the £1,000 loan than have any savings at all.
If you owe money for a mortgage for example £100,000 over 30years.
Just for example if you have a fixed rate at 5% over the entire 30years (Yeah right but for an example)
But you overpay by just £100 a month for the full term of the mortgage you would pay the mortgage off almost 9 years sooner and save yourself over £30,000 in interest
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
This is wrong too - £85,000 of your deposits in each banking group are covered by the government. They are as safe as deposits in premium bonds.
There is no reason to invest in premium bonds. They are without exception one of the poorest mass market investment products available.