OR
Start a small business (with 50k)
In the absence of using the stock market, the only way is to look into fixed-term bonds offered by banks and building societies that will pay better interest. The highest interest one I know is with Skipton Building Society, which has one that pays 3.5% interest if you lock it away for 7 years. That's the thing - the longer you tie it up for, the more interest you get. You (or she) can search moneysupermarket.com to find these.
The semi-stock market option is unit trusts. These are a way of pooling funds with other investors so that the fund manager can invest it in a good spread of companies. You can pick a trust that invests in some particular sector of the market.
Yes I know you didn't want this but a fairly safe investment I've done well out of is a FTSE index-tracker unit trust. What this does is buy shares in all the companies on the UK FTSE stock market index, so it's going into the biggest companies in the country and is as safe as you're going to get outside of bank accounts. Therefore there is no thought involved in what shares to buy and that keeps the management charges down. And it tends to do better than other unit trusts 75% of the time (which probably says a lot about how much use investment experts are!) Legal & General do a good one with low charges. With interest rates lower than they have been in living memory, this is worth looking into. http://i.legalandgeneral.com/consumer/in... Look at the performance tab - that is one impressive graph. In 2011 the value of the fund went down - but in the other four years it went up over 10% a year. Not bad over the long term, and that's what your friend is looking for, not to make a "quick buck" now.
She would get distributions from the dividends paid on the shares, but the real money is made, as with shares, from the value of the units going up, as that graph shows. On selling units, that's a capital gain, not income, so it is chargeable to capital gains tax rather than income tax - which is lower and has its own annual tax-free allowance.
There is plenty advice available,
so the first thing she needs to do is make an appointment with her bank, and they'll suggest
ways for the money to work for her
For such a large amount, professional advice is highly recommended.
https://www.moneyadviceservice.org.uk/en...
http://www.thisismoney.co.uk/money/exper...
to be honest Jason unless she can find a way herself there isn't as soon as you get someone else involved they are going to make more out of it than she will banks are the biggest crooks they all are Jason it's the way things have become there are fingers in the pie everywhere even pensions have desperate returns to what they used to be property may be one way to go she is losing money at the moment with inflation the bank isn't they charge 20/30% that's how unfair it is so she must think of something solid to invest in as long as she isn't going to need it
Another kind samaritan asking a question on behalf of a "friend" who obviously can't be bothered to ask it herself. She is best off using it as a deposit on a property as everything else is either too risky or does not pay any decent interest.
Hi guys,
A very close friend recently inherited a large sum of money, around 100k. She currently just has it sat in a basic savings account earning next to no interest and she is getting worried as this money has to last her pretty much the rest of her life (she's in her mid 40s).
I feel bad that there isn't really any advice available online for people in this circumstance and can only really find "risky" investment plans.
I was just wondering if anyone here has any advice that I could relay to her as to the best and safest way to invest while still earning a decent annual interest.
I'm not looking for any suggestions like playing the stock market or anything like that as she also has a full time job.
Any advice would be appreciated though.
Thanks.
