IF YOU INHERITED HALF A £MILLION TOMORROW WHERE SHOULD YOU PUT YOUR MONEY, FOR INCOME OR GROWTH?


By Paul Hamer, Director, Advisa Wealth. T


he receipt of a potentially life changing amount of money is clearly a big deal. It’s important to think carefully about your options, and how this money can best help you in life.


Take your time


I’ve seen examples of individuals investing the money the second it arrives. Little thought has been given to the client‘s objectives, money has been invested into the latest fad investment which relies on expensive guesswork from an underachieving portfolio manager. The client then decides at a later date what they really want to do and so try to change the investment strategy often with investment losses. Take your time is my best advice.


People sometimes feel they need to make a decision there and then about what to do with the money, almost as if it’s a burden they need to unload immediately. There is a sense that the clock is ticking and making a decision, any decision, is better than doing nothing. But it isn’t!


At your own pace I can’t over emphasise the importance of thinking carefully about financial goals and ambitions, so finding a professional Financial Planner or Adviser that helps


clients find the time is paramount. Bearing in mind that this money has been perhaps received after the loss of a loved one, it is particularly important that they are given the support and space to take decisions at their own pace.


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Choosing an adviser Ensure that you pick an adviser that is appropriately qualified and truly independent This ensures total impartiality when choosing the investment solution. A professional independent Financial Planner or Adviser is a wise choice as banks and other tied companies can only recommend their own product range which may be limited and may not align with the necessary objectives.


IMPORTANT:


If you have any high-interest consumer debt, such as credit cards, it's a good idea to pay that off before you invest any money, then…


Build an emergency fund


An emergency fund should be a relatively liquid sum that is left untouched unless something unexpected comes up. The idea is not to dip in every time but for keep it for genuine emergencies, such as redundancy, emergency home maintenance, and so on. If funds are required from the emergency fund at any time, then the priority should be to replenish them. Treat the emergency fund right and it will return the favour. For most people 3-6 months of expenses should be sufficient and could be held in National Savings products


(which are 100% backed by the UK government).


Don’t forget tax With an inheritance of this size serious consideration should be given to the tax implications. Dependent on your


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