Sold house in UK.what to do with funds.Help

[phusingpete]

Hallo gentlemen, I have looked at this thread and others in the finance section for some time now and hope that I may get some useful advice re

a welcome problem. It seems that I have at last sold my house in the UK which could yield around 235,000 GBP after expences.

I do not need to spend any of this as I have good pensions though as I lose the rental income I may need to dip into interest payments.

I have a six year old daughter and I would like to secure her educational future with a secure deposit fund, to be utilised in 10-12 years time.

Also I would like to make a secure investment which would provide some income for my wife after my demise, I am somewhat older than my wife.

My wife will receive a widows pension so she will have some reliable income, not sure how much, depends on when I fall off my twig.

Should I bring the entire amount into Thailand, hopefully the exchange rate will remain good until I get the cash, or should I set up a trust fund with

50% of the funds in England for my dahghter.

I should point out that I am 71 years old and am not really in to following stock movements etc. So basically I need......................

1) A secure long term investment for my daughter.

2) A longish term (hopefully) investment for my wife.

3) A slush fund thingy that I can dip into.

As I said I have followed threads on here for some time some of which I understood, but am now in a position to actually invest. Any advice would be

much appreciated. I thank you for your contributions to these threads in the past and for any advice you may pass on to me.

Sent by Peter

[davejones23]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

Edited May 3, 2014 by davejones23

[Duff]

A widely diversified portfolio of high rated bonds and preferred shares. Nothing to manage, you don't care about price fluctuations and you get fixed incomes. You could easily secure between 5 and 10% yearly returns

Sent from my iPhone using Thaivisa Connect Thailand

[uptheos]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

In 20 years he will be 91 if still living!!

My advice is take a goodly chunk and have a bloody good time while you can.

[falkan]

i think it's very irresponsible getting a kid when you that old! how will you be able to help your kid?

anyway re-invest your money in property back home!

[KittenKong]

I think the OP should give some consideration to inheritance taxes/domicile as he clearly wants to leave as much as he can to his dependants.

In order to give a sensible suggestion as to what he should do with his cash one would need to know whether his other UK income exceeds his UK personal allowance.

[KittenKong]

i think it's very irresponsible getting a kid when you that old! how will you be able to help your kid?

By leaving it 235KGBP? This is more than most Thais earn in a lifetime.

[henksteeghsth]

People you only live one time

in your last suit you have no pockets

enjoy life especially if you are over 70

Make a secure deposit account for your daughter and let this come out wen she needed it

Also for your wife you can do this she don`t even need to know

The rest spent it and start living

ENJOY LIVE

[pancakeman]

Buy a Bitcoin

[rak sa_ngop]

Recommend that you make your investments while you are still resident in the UK. Once (if) you become non resident many/most UK financial institutions will not accept your money. Life then becomes much more complicated!

Also do not destroy what you think are out-of-date documents. Proof of income may still be required for reinvesting money that you made 25 years ago. House sale documents will help greatly.

[AyG]

(1) Do you have any other assets? If so, inheritance tax may need to be taken into account.

(2) How long have you been living in Thailand? Is there a case to be made that you are not UK domiciled? (I.e. permanently severed ties with the UK.)

(3) Do you have any UK-sourced income e.g. pension? If so, is the sum this income plus the amount of income you want to take from your investments above or below the nil rate income tax band, which at your age is £10,500/year? If it's above you should think about moving some or all of your money offshore to save on income tax.

(4) Have you made a will leaving 50% to your wife, 50% to your daughter? That is something that would immediately secure their futures?

No need for any sort of trust for your daughter, unless you think that relatives would try to take the money from her, or she would blow the money quickly. If you trust your wife to manage the money on your daughter's behalf, leave all to your wife, explaining your intentions concerning your daughter's future.

[davejones23]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

In 20 years he will be 91 if still living!!

My advice is take a goodly chunk and have a bloody good time while you can.

If the money was for himself I'd agree, but he wants a good investment for his daughter and wife. For a young daughter I think property would make a fantastic investment.

[SheungWan]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

In 20 years he will be 91 if still living!!

My advice is take a goodly chunk and have a bloody good time while you can.

If the money was for himself I'd agree, but he wants a good investment for his daughter and wife. For a young daughter I think property would make a fantastic investment.

For someone 71 and who has just disposed of his property, to suggest more of the same is a no-no IMHO. Easier to both leave most of the monies in the UK and invest some of it in an Income Fund. There are a number to choose from. So, possibility......

50K emergency fund. Term deposit Thailand.

150K Income Fund(s). UK

35K spending money Thailand

The above also assumes you have some other income source.

Edited May 4, 2014 by SheungWan

[cmsally]

What would the average (income) percentage be for an income fund AFTER the subtraction of all the costs ie any entry fees, management fees, transaction, commission etc etc.

Any ideas ??

[Jip99]

I think the OP should give some consideration to inheritance taxes/domicile as he clearly wants to leave as much as he can to his dependants.

In order to give a sensible suggestion as to what he should do with his cash one would need to know whether his other UK income exceeds his UK personal allowance.

The answer is obviously "yes".

The OP quoted pensions in the plural and that his wife would get a widows pension. That suggests receipt of state pension (where no widows pension will exist) and company pension/s where it will.

Don't go offshore to the likes of Jersey or Guernsey - little benefit and a bl00dy nightmare when you do leave this mortal coil.

[SheungWan]

What would the average (income) percentage be for an income fund AFTER the subtraction of all the costs ie any entry fees, management fees, transaction, commission etc etc.

Any ideas ??

You can look up the performance of individual funds such as M&G. eg The Worldwide Income Fund. One place to do one's checking is Trustnet http://www.trustnet.com/

PS. If you are just looking for an average sector performance and low fees an ETF is probably your better bet. Unit trusts and investment trusts have a buy/sell spread (at least unit trusts do) and claim to offer more focus and performance. You pays your money and you makes your choice. All of the above probably better suited to the new investor inexperienced in choosing individual stocks (or bonds).

Edited May 4, 2014 by SheungWan

[Jip99]

(1) Do you have any other assets? If so, inheritance tax may need to be taken into account.

(2) How long have you been living in Thailand? Is there a case to be made that you are not UK domiciled? (I.e. permanently severed ties with the UK.)

(3) Do you have any UK-sourced income e.g. pension? If so, is the sum this income plus the amount of income you want to take from your investments above or below the nil rate income tax band, which at your age is £10,500/year? If it's above you should think about moving some or all of your money offshore to save on income tax.

(4) Have you made a will leaving 50% to your wife, 50% to your daughter? That is something that would immediately secure their futures?

No need for any sort of trust for your daughter, unless you think that relatives would try to take the money from her, or she would blow the money quickly. If you trust your wife to manage the money on your daughter's behalf, leave all to your wife, explaining your intentions concerning your daughter's future.

i am sure he will trust his wife. It is the vulture relatives and the ENORMOUS pressure they exert that are the danger.

[Jip99]

i think it's very irresponsible getting a kid when you that old! how will you be able to help your kid?

By leaving it 235KGBP? This is more than most Thais earn in a lifetime.

I think falkan was suggesting that the OP will not be out playing football with his daughter when she is 12.

Bonding down a nightclub when she is 18 may also be a challenge too far.

An inheritance of this size could be a burden. It needs careful thought and application.

[AyG]

Don't go offshore to the likes of Jersey or Guernsey - little benefit and a bl00dy nightmare when you do leave this mortal coil.

I'm curious about this statement. It the "nightmare" comment based upon bank accounts? QROPS? Investment funds? Could you expand, please. From a personal point of view I don't want my executor to go through a nightmare experience.

[luk AJ]

Good job OP! You really were able to get some very helpful reactions from this forum! Don't play stupid because as you can see, some people actually believed your post

[prakhonchai nick]

Don't go offshore to the likes of Jersey or Guernsey - little benefit and a bl00dy nightmare when you do leave this mortal coil.

I'm curious about this statement. It the "nightmare" comment based upon bank accounts? QROPS? Investment funds? Could you expand, please. From a personal point of view I don't want my executor to go through a nightmare experience.

Investing money in the Channel Islands or Isle of Man will save on income tax., However, upon death, the savings made will be eaten up by your wife trying to get at the invested money. Probate will be needed, and this has to be done by probate specialists who charge a hefty fee, and take a long time to do anything.

[prakhonchai nick]

I would certainly put £30,000 into premium bonds (£40,000 from June and £50,000 sometime next year). You may have a big win, and the loss of interest is rather irrelevant given todays low rates.

[fletchsmile]

If you're committed to Thailand and see your future here, and then passing away here, then I'd say smart move on selling your biggest asset and converting it into more liquid assets that you can enjoy during your life, and more practically planning for your wife and kids future.

UK property may be a good investment for someone who's up to managing it and in good health. Once you pass on though it's hardly a realistic option for a Thai wife and young kid based in Thailand to be relying on UK property income and all the hassles that come with that. Finding tenants, bills, maintenance, taxes, not to mention just going thru probate to gain ownership. If someone really believes property is the best asset class, they'd be better off with real estate investment trusts (REITs) or unit trust property funds for a Thai spouse in Thailand.

As for what next? There's so much more info needed to make decent decisions, so at best you'll get on here a few ideas and suggestions. It would be worth seeking advice from someone you trust, as proper recommendations really need to understand your full situation.

A few things I'd be looking at (you may differ and they're only ideas/ suggestions):

Normally I say keep money where you come from in case you want to go back. Realistically if things went pear shaped I couldn't see you heading back to start over at the age of 71. So I'd be more inclined to move most of my assets here to facilitate the best life possible for you, your wife and your child. Keep UK bank accounts open though, with say GBP 10k+ liquid. Dealing with UK probate would be hassle for a Thai, which is another reason to bring money here now while you yourself can arrange.

Do have a plan B though in case something doesn't work out in your relationship - can happen to anyone . Even if it's only living off your pension income here.

When making decisions try and make ones that benefit both your present life and your wife and kid's future. Selling the house is a great example. Can benefit your family now, and provide a secure future.

Involve your wife in the process. She will likely have different ideas on managing money. Whatever you do, needs to be something she can carry on when you're gone. eg I'm not into land. My wife like most Thais is. So she bought some and rents it. Key is she understands and can manage it, even if not necessarily the maximum return you youself could get.

If you haven't already, consider buying a home to ensure your wife and kid always have a roof over their head when you're gone, as well as a home to enjoy now.

Think about your daughter's education. Will it be international school, bi-lingual, or Thai. How much will that cost? Education is one of the best things you can give your daughter for her future. An international school and university education for example could be ball park THB 8mio (GBP 150k) for another 16 years until 22.

I'd sort these two out first and then see what remains.

I'd also keep a couple of years expenditure in THB cash, on top of your THB 400k/ THB 800k visa extension requirement. Spread your cash between banks.

I'd also have some cash for the nice things in life/ slush fund to spend enjoy.

After that for re-investing the rest, I'd personally look at unit trusts/ mutual funds to generate extra income and hopefully some capital growth. Spreading across different asset classes. Something like:

High interest cash accounts 30% earning 2.5% to 3% over different banks

Thai equity funds - dividend paying funds 20%, something like UOB Big Cap Div yields over 6% and has some potential for capital growth

Overseas equity funds - dividend paying funds 20%

Overseas bond funds - 10% - Normally I'd say hold some Thai bonds but they just aren't great value at the moment hence have upped the cash holding

Property funds/ REITs - 10% - paying divs

Gold funds 5%

5% in whatever else you fancy/ like more as the above are only an idea

These would generate income on top of your pension for day to day life as well as future.

When investing, consider putting some in joint names, some in your daughters name by you. This would help reduce inheritance tax issues, and also smooth the process of your wife and kid getting control of your assets when you're gone

Cheers

Fletch

Edited May 4, 2014 by fletchsmile

[fletchsmile]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

In 20 years he will be 91 if still living!!

My advice is take a goodly chunk and have a bloody good time while you can.

If the money was for himself I'd agree, but he wants a good investment for his daughter and wife. For a young daughter I think property would make a fantastic investment.

So if he does as you say, and dies a couple of years later. What would you say is the best way for a Thai national living in Thailand and a half-Thai half English minor. child to manage a UK property as an overseas investment while living in Thailand?

Who would help them thru UK probate, land registry. Then there's monthly bills, taxes, admin, upkeep, insurance, visas to visit, getting around while there etc. Foreign exchange risk?

What would they do if they couldn't find a tenant for the property or ended up with squatters?

I can see how it makes sense for you as a UK national, and why you're comfortable with it, but I'd seriously question a Thai lady and a minor child having their main assets tied up in UK (overseas) property. Not something I'd realistically give more than a few minutes thought to for my Thai wife an kids, but on the other hand I'm always open-minded for solutions.

Cheers

Fletch

Edited May 4, 2014 by fletchsmile

[Jip99]

Don't go offshore to the likes of Jersey or Guernsey - little benefit and a bl00dy nightmare when you do leave this mortal coil.

I'm curious about this statement. It the "nightmare" comment based upon bank accounts? QROPS? Investment funds? Could you expand, please. From a personal point of view I don't want my executor to go through a nightmare experience.

You are thinking on exactly the right lines (as is davejones in a later post). What might seem to be a good idea now could be a nightmare for those (of lesser capability) left behind to administer the estate. Just imagine the barriers (language, intellectual etc) that a Thai widow may face dealing with UK or offshore authorities/institutions.

Post #21 from Prakhonchai Nick partly covered it - Probate obtained in the UK, or Thailand, is not acceptable in offshore centres such as Guernsey and Jersey. In a recent case fees amounted to over GBP 4,000.

Edited May 4, 2014 by Jip99

[rayongchelsea]

Is she going to an international school..then the funds need to be more liquid. That is the best use of the money..to pay for her education..should just be enough till 18.

Sent from my iPad using Thaivisa Connect Thailand mobile app

[CPH]

Your daughter could nearly live from that amount for the rest of her life if the money is placed properly. You have to think about a will in the country where you place the money.

[seasia]

If you're committed to Thailand and see your future here, and then passing away here, then I'd say smart move on selling your biggest asset and converting it into more liquid assets that you can enjoy during your life, and more practically planning for your wife and kids future.

UK property may be a good investment for someone who's up to managing it and in good health. Once you pass on though it's hardly a realistic option for a Thai wife and young kid based in Thailand to be relying on UK property income and all the hassles that come with that. Finding tenants, bills, maintenance, taxes, not to mention just going thru probate to gain ownership. If someone really believes property is the best asset class, they'd be better off with real estate investment trusts (REITs) or unit trust property funds for a Thai spouse in Thailand.

As for what next? There's so much more info needed to make decent decisions, so at best you'll get on here a few ideas and suggestions. It would be worth seeking advice from someone you trust, as proper recommendations really need to understand your full situation.

A few things I'd be looking at (you may differ and they're only ideas/ suggestions):

Normally I say keep money where you come from in case you want to go back. Realistically if things went pear shaped I couldn't see you heading back to start over at the age of 71. So I'd be more inclined to move most of my assets here to facilitate the best life possible for you, your wife and your child. Keep UK bank accounts open though, with say GBP 10k+ liquid. Dealing with UK probate would be hassle for a Thai, which is another reason to bring money here now while you yourself can arrange.

Do have a plan B though in case something doesn't work out in your relationship - can happen to anyone . Even if it's only living off your pension income here.

When making decisions try and make ones that benefit both your present life and your wife and kid's future. Selling the house is a great example. Can benefit your family now, and provide a secure future.

Involve your wife in the process. She will likely have different ideas on managing money. Whatever you do, needs to be something she can carry on when you're gone. eg I'm not into land. My wife like most Thais is. So she bought some and rents it. Key is she understands and can manage it, even if not necessarily the maximum return you youself could get.

If you haven't already, consider buying a home to ensure your wife and kid always have a roof over their head when you're gone, as well as a home to enjoy now.

Think about your daughter's education. Will it be international school, bi-lingual, or Thai. How much will that cost? Education is one of the best things you can give your daughter for her future. An international school and university education for example could be ball park THB 8mio (GBP 150k) for another 16 years until 22.

I'd sort these two out first and then see what remains.

I'd also keep a couple of years expenditure in THB cash, on top of your THB 400k/ THB 800k visa extension requirement. Spread your cash between banks.

I'd also have some cash for the nice things in life/ slush fund to spend enjoy.

After that for re-investing the rest, I'd personally look at unit trusts/ mutual funds to generate extra income and hopefully some capital growth. Spreading across different asset classes. Something like:

High interest cash accounts 30% earning 2.5% to 3% over different banks

Thai equity funds - dividend paying funds 20%, something like UOB Big Cap Div yields over 6% and has some potential for capital growth

Overseas equity funds - dividend paying funds 20%

Overseas bond funds - 10% - Normally I'd say hold some Thai bonds but they just aren't great value at the moment hence have upped the cash holding

Property funds/ REITs - 10% - paying divs

Gold funds 5%

5% in whatever else you fancy/ like more as the above are only an idea

These would generate income on top of your pension for day to day life as well as future.

When investing, consider putting some in joint names, some in your daughters name by you. This would help reduce inheritance tax issues, and also smooth the process of your wife and kid getting control of your assets when you're gone

Cheers

Fletch

to the OP

Although in a totally different situation, being younger, without too serious commitments and very active as an investor/trader, the above posted by Fletch is overall excellent advice/suggestion IMO, based on your intentions to provide for the future.

I`d maybe juggle some of the %s spread but that`s just me, it`s a superb post worth looking in to more.

GL.

[rayongchelsea]

I have often though of selling my UK property, but have always come to the conclusion that it's a great investment for the future. I get around 5% rental income plus capital growth, which has been around 10-20% over last few years. If I sold, like you, I'd lose the rental income and have to start spending the money I got for it. I don't know anything that would do as well over the next 10-20 years as property. I'd say a UK property would be a great investment for your daughter. I don't see that cash is a good investment at all. A safe deposit account would pay less than inflation, so the money will become more and more worthless over time. Property generally grows in value over time, although there's always a risk of a property crash. But I've lived through a few of those and am still massively ahead.

So my short answer would be to buy a property. But I doubt that is what you want to hear. I'd be interested to know why you sold it.

In 20 years it could be worth £500K+, and you'd have been getting rental income of maybe 5%. Your £235K on deposit will be worth £235K, and you'll have been getting 1-2% interest. Barring a huge property crash, I can't see how cash is better. Which is why I haven't sold.

In 20 years he will be 91 if still living!!

My advice is take a goodly chunk and have a bloody good time while you can.

If the money was for himself I'd agree, but he wants a good investment for his daughter and wife. For a young daughter I think property would make a fantastic investment.

So if he does as you say, and dies a couple of years later. What would you say is the best way for a Thai national living in Thailand and a half-Thai half English minor. child to manage a UK property as an overseas investment while living in Thailand?

Who would help them thru UK probate, land registry. Then there's monthly bills, taxes, admin, upkeep, insurance, visas to visit, getting around while there etc. Foreign exchange risk?

What would they do if they couldn't find a tenant for the property or ended up with squatters?

I can see how it makes sense for you as a UK national, and why you're comfortable with it, but I'd seriously question a Thai lady and a minor child having their main assets tied up in UK (overseas) property. Not something I'd realistically give more than a few minutes thought to for my Thai wife an kids, but on the other hand I'm always open-minded for solutions.

Cheers

Fletch

Totally agree. The guy is 71 years of age..absolutely the right thing to do...bring it over here..put all in the kids name, she will need protecting..no one can ever foresee how things will work out, the family courts do a good job of monitoring a child's assets in my opinion...

As previously stated..a good education is the biggest gift you can give a child, especially over here..

Sent from my iPad using Thaivisa Connect Thailand mobile app

[stickylies]

give it to me. i'll take care of wife and child when time is there. word!