Moderate inheritance, no investment experience

[KatieMay]

I'm in my mid 50s and have worked on a freelance basis for the last 20+ years - am a sole trader in tax terms and not a high earner. I own my home (no mortgage) but have made no pension provision. Until recently I'd children in college, but they are finished and working and I've no dependents now.

I have a small amount of savings, but definitely not enough to live on for very long after retirement. I don't plan on retiring at 65, though who knows - but there is no reason that I cannot continue working as long as I like and am able to.

I will shortly have an inheritance of somewhere between €80k and €100k. Other than just sticking it into the bank, I've no idea what would be the wisest/best way to get the most benefit from this money over the medium-longer term. I'd appreciate any advice, I really haven't a clue. I have only ever earned enough to live on and save a small amount. While not profligate, I've obviously - given my lack of retirement planning - not been particularly wise either, so I'd like to make the most of this.

 

[Sarenco]

Hi KatieMay

Welcome to AAM.

As you might expect, posters will take different approaches to this question but here's what I would do if I was in your shoes:-

• If there are any improvements that you think would make your home more comfortable (double glazing, improved insulation, etc.) then look after those things first;
• Use half the balance of the inheritance to buy 5-year State Savings Certificates from An Post; and
• Use the other half to buy a global equity investment trust - something like Foreign & Colonial Investment Trust plc (founded in 1886 and still going strong!).

Here's a thread on broker costs, taxes, etc that you might find helpful -
https://www.askaboutmoney.com/threads/summary-of-stock-market-investment-costs.194304/

You might also want to consider starting a pension - it really is the most tax efficient way to save for your golden years.

Hope that helps.

 

[KatieMay]

Thank you so much, that all seems very wise advice. I read the thread you linked to and now I've a headache! But I'll go back and read it a couple of times again and it'll eventually make more sense to me.

I sort of thought I'd missed the boat entirely on pensions, but is it still worth looking at? If I am honest pensions terrify me. All you ever seem to hear about them is people losing everything, or only getting a fraction of what they expected or invested - years of savings down the drain. Perhaps that just the stuff that makes the news and is giving me a warped view.

The only time I ever 'invested' in anything was years ago when a broker sold me an endowment mortgage, which was a total disaster and put me off both investments and brokers for life. But I realise I urgently need to start wising up.