Investment Choices

[catsrcool]

I have just received £40k lump sum from my pension what's the best way to get a decent return on it?

[sandyRoe]

You could get 2.5% on it if you were prepared to go for a 3 year bond.

http://www.money.co.uk/savings-accounts/3-year-fixed-rate-bonds.htm

[factor-fiction]

you can but an annuity but that may seem a bit pointless as you've just taken the money from your pension pot (albeit tax free).
It depends whether you want a regular income or want to tie it up for a few years. You'll be lucky to get more than 2-2.5% on it if you want annual /monthly income

[dr b]

Nothing safe is offering a "decent return" at the moment

There's no way to give a good answer to this question without knowing a lot more about your financial situation - more than you want to divulge here. How soon will you need to spend the money? How big is the rest of your portfolio, and what is it invested in? You can't consider this 40k in isolation, but you should think of how it fits in to your entire portfolio. Maybe a visit to a fee-only financial planner for a consultation is on order.

[catsrcool]

Thank you

[Hymie]

Pay off any debts you have (including the mortgage) – this will give the best return, given the low saver interest rates available. But make sure you have enough for a rainy day (say £10k) – otherwise spend it and enjoy it, that is what money is for (but don’t waste it on a brand new car).

[1ndex]

premium bonds max is £30k. Block buying often wins but if you win a million you can do a bongo bongo - lol

[Hypognosis]

Until fairly recently, it would have been sound advice to recommend shopping around for the best annuity rate that you could find. Annuity rates were seriously out of whack with real world life expectancy, so there was a good chance that you'd live long enough to win the 'bet'. However, from what I've heard said in the finance section of the news, recently, these annuity rates have undergone significant revision so, these days, you will get a rate that is - to be fair to the provider companies - more realistic, with respect to lifespan.

If there is a concern that you might not live long enough to get 'a return on your invenstment', so to speak, then you could always pay into a life assurance plan, from the annuity income.

One obvious problem with all of this is that, once you've bought an annuity then you're committed to it permanently. None of us know what's going to happen to interest rates in a few years time, since it's all due to the politics of the moment. The financial advisor might be able to put the numbers into their computer and predict whether it is best to wait or to act now.

[bookbinder]

See an independent financial adviser.

[Hymie]

Some are suggesting you buy an annuity with the money – that is one of the worst investments you could make with the money. With a return of around 5% (flat rate), it will take around 20 years just to get your money back – and probably more, if you are paying tax on the pension pay out.

Be aware that a financial adviser might suggest an annuity – for their personal gain, not yours.

[Hymie]

Don't forget that when you die, the pension company gets to keep your pot of pension money.

[dollie65]

ive got yearly bonds and they pay a monthly interest that boosts my pension...think carefully before you decide to tie up monies longer than a year as you never know when you may need it...

[jesusstarck]

As per my view you can money invest in any real estate property and earn more money. You can consult with any famous and experienced real estate agent or company for getting guide to invest money.