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

[SheungWan]

Sorry, I have to correct this, it is: http://www.montpeliergroup.com

I don't think it's correct yet. That's a link to a firm of accountants. There's also a (UK) Montpelier Asset Management that doesn't appear to be linked to the accountants, but they don't have overseas offices. There are then companies like Montpelier Wealth Management which appears to have offices in China, Malaysia and Thailand, but doesn't appear to have any links to the UK.

Anyway, whichever company you're writing about, anybody who claims they can invest "in bonds etcetera with a minimum risk ... can garanty a 8% yield/year" is clearly very, very dodgy. The only way you can guarantee 8% a year is by eroding the capital. The only way you can make 8% a year is by taking on a significant degree of risk.

My advice: keep clear.

+1

I was interested by the claim, and had exactly the same thoughts as AyG.

I recognise the name of Montpelier as a financial advisor group, and would be very careful. These type of companies offering these products (often offshore bonds) are often designed to maximise their own commission, and can seriously damage your wealth. Not to say they can't be useful to some, but you need to be very careful.

If Peter has a real link to the where they can "guarantee a 8% yield/year" I'd be interested to check it out. I've yet to find a legitimate company offering a "guaranteed 8%" without there being some significant risk or more to the picture elsewhere. Anyone pitching that to me sets alarm bells ringing. My own annual returns on my investments exceed that on average, but I take risks to do so and understand the risks that some years will be less and some more, and capital is at risk. These probably wouldn't be appropriate either for many retirees.

Cheers

Fletch

@AyG and @Fletchsmile

Maybe you'r right but I have vist there office in BKK and they give a good feeling, they investing inter alia in Pimco, as far as I know it is a big investment fund. But ofcourse "garantee" investment is impossible.

Stay away from 'no-names', whether or not they claim connections to known investment vehicles.

Edited May 5, 2014 by SheungWan

[phusingpete]

Just wondering if it is possible to buy premium bonds if you live outside the country.

[chiang mai]

Not if you are non-resident. Anyway, the return is dreadfully low.

BTW agree with others that you should avoid offshore IFA's etc, there's no protection in them as offered by onshore UK IFA's.

[phusingpete]

Obviously I will have to spend some time decoding, IFA's and the like. Give me something more to do in my old age.

[phusingpete]

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.

Very well deduced my dear jip99,

My pensions do exceed my personal allowance, which has meant that with rental income I pay significant tax every month. which is another reason to sell the house and get the cash out of the UK....

[chiang mai]

Obviously I will have to spend some time decoding, IFA's and the like. Give me something more to do in my old age.

Sorry, IFA = Independent Financial Adviser, they're strictly regulated in the UK, not so elsewhere to any meaningful degree.

[apiwan]

I'd buy a 1 bed flat anywhere round London for about 150. Even on a shitty part like Dagenham you'll get 2 beds for that money give to housing or council rented easy money every month.

At least when your daughter grows up and wants to live there and even go to uni she'll be ok.

If she wants to sell it and move elsewhere . Also better.

Leaves you with 85K to enjoy.

Did you say which part of UK you sold in ?

Sent from my SM-N9005 using Thaivisa Connect Thailand mobile app

[sometimewoodworker]

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.

Not true. My wife is a joint account holder in the IOM so there is no Probate problem and no fees to pay. Also probate dosen't need specialist services. Most good accountant firms do it all the time.

[SheungWan]

I'd buy a 1 bed flat anywhere round London for about 150. Even on a shitty part like Dagenham you'll get 2 beds for that money give to housing or council rented easy money every month.

At least when your daughter grows up and wants to live there and even go to uni she'll be ok.

If she wants to sell it and move elsewhere . Also better.

Leaves you with 85K to enjoy.

Did you say which part of UK you sold in ?

Sent from my SM-N9005 using Thaivisa Connect Thailand mobile app

The joys of Dagenham.

[khunPer]

Those of us who wish to leave something for our loved ones or family have that kind of considerations – also me.

I don’t know about British legal system, but I think it is important to make the set-up as simple as possible, so not being complicated and costly in (lawyers) fees when the day come, the money is going to be transferred to the beneficiates.

I’m from a country where they tax inherit (15 to 36 percent), so if that is also the case in Britain, it is worth to take into consideration. In Thailand there is no inheriting tax.

I believe a will – or rather two, one in Britain for any wealth there, a one in Thailand for what may be placed here – is the best way to legally deal with it, that’s what lawyers recommend. In Thailand money for children will be in deposit under guardian until the age of 20 or 21, however should be possible to state in a will that outcome or dividends may be accessible for living costs and up to a certain amount of the initial value cashable for education, illness etc. Whilst alive, we can manage ourselves – especially in Thailand it is, to my understanding, not that complicated that we need to set up trust funds and the like. It may also be good to have easy access to some kind of capital in case of emergency.

Yes, the exchange rate is good at the moment, so a certain amount, maybe 50 percent, may be worth transferring into Thailand; may also be depending of any inheriting tax. There are reasonable options in Thailand for long terms investments with the so-called Fund Books in the banks; Kasikorn Thai have a rather good English information on their website, but presumably most banks offer Fund Books; I’m using both Bangkok Bank, SCB and Kasikorn. You can choose between bonds, equity, and gold etc. depending of the risk you are willing to take. Most Fund Books are not taxed, for example deposit in bonds raise in value and the interest is therefore not withholding taxed with 15 percent like a fixed bank deposit. The so-called LTF are capital gain tax-free of up to 500,000 baht withdrawals a year. Some LTF and Equity funds pay dividends.

You can open Fund Book(s) in your daughter’s name together with a guardian's name, so two names on the deposit account. I have done that for my daughter with some savings. The deposit is under guardian until legal age (20-21). However, the same bank may not accept the guardian to be named both on a shared account (guardian for a minor) and an individual account (guardians own Fund Book). There are separate Fund Books for bonds, LTF, equity etc. so the limitation seems to be for one kind only, i.e. if a shared LTF Fund Book account, the guardian may have own bond Fund Book account. Otherwise use more than one bank.

Many will have reservations about investing in Thailand, others the opposite. I think it is Okay if you are living here and going to spend the money here. A good reservation may be to transfer amount over the equivalent of 20,000$ and have the paperwork made in the bank, so you can take the same amount out again, just in case…

[seasia]

Sorry, I have to correct this, it is: http://www.montpeliergroup.com

I don't think it's correct yet. That's a link to a firm of accountants. There's also a (UK) Montpelier Asset Management that doesn't appear to be linked to the accountants, but they don't have overseas offices. There are then companies like Montpelier Wealth Management which appears to have offices in China, Malaysia and Thailand, but doesn't appear to have any links to the UK.

Anyway, whichever company you're writing about, anybody who claims they can invest "in bonds etcetera with a minimum risk ... can garanty a 8% yield/year" is clearly very, very dodgy. The only way you can guarantee 8% a year is by eroding the capital. The only way you can make 8% a year is by taking on a significant degree of risk.

My advice: keep clear.

Yes, as above keep clear, no knowledge of Montpelier, although know of Pimco who it has been said they invest in.

Unfortunately a lot of companies will convince ordinary people to invest in a product/package that is totally inappropriate.

Sometimes there can be punishing early exit fees, i.e. if for any reason you or your family needed the cash for something else, it could be an expensive exercise to get that money out.

I was quite sad to witness an elderly couple who had been talked in to a somewhat complex " structured product " have second thoughts and try to get out.I should not have even been privy to the conversation.

I`m struggling to add much of use but basically if someone is trying to sell you an investment and you don`t understand it fully and any risks that go with it, walk away.

Unless you have both the time and some ability, anything you do, and there have been some decent suggestions, has to be fairly simple.

I take on some risk in achieving above average returns but am aware ( mostly ) of them and spend a lot of time digging in to detail.

A reasonable spread of investments, with not too much in any one is maybe the best for you.

On a far lighter note, am aware of the frustrations of being a landlord ( in the UK )it can sometimes hardly seem worthwhile after deducting agents fees, maintenance, repairs & inspections etc.

I do still rate UK property though, as part of a mix.

[prakhonchai nick]

Hi Peter (phusingpete),

I think this is not the right place for such an important thing. You don't know the person who is writing here.

I am doing wealth management and consultation for more than a decade.

I would recommend a meeting in Thailand. Send me an email to c08200(at)gmail.com. Then we could arrange a meeting.

Cheers,

Chris

He doesn't know you either Chris61!

I think he is just exploring possibilities at this time - It is probably not the time to commit himself.

Edited May 5, 2014 by prakhonchai nick

[KittenKong]

Not if you are non-resident. Anyway, the return is dreadfully low.

Non-residents certainly can buy premium bonds: http://www.nsandi.com/savings-premium-bonds-other-ways-apply

The return depends on how lucky you are. I am satisfied with mine and there is always the possibility of a large win. I don't suppose I would ever put more than a couple of percent of my total wealth into them though.

[chiang mai]

Not if you are non-resident. Anyway, the return is dreadfully low.

Non-residents certainly can buy premium bonds: http://www.nsandi.com/savings-premium-bonds-other-ways-apply

The return depends on how lucky you are. I am satisfied with mine and there is always the possibility of a large win. I don't suppose I would ever put more than a couple of percent of my total wealth into them though.

Well I'll be, it seems they can. The last time I checked on this was about seven years ago and I'm pretty certain at the time non-resident for tax purposes individuals could not - or perhaps I'm thinking of other nsandi accounts, now I'm unsure! Regardless, apologies for the disinformation.

[KittenKong]

That depends on your point of view. As I mentioned, it's more than many Thais earn in a lifetime and so them it would indeed be overwhelming.

It is also significantly more than many impecunious farang 30-year-olds have to their name, and that doesn't seem to stop them having children.

Well, lets see - buy a 10 million baht condo or house - sorry, all money gone in one go.

Maybe you should work out how much she'll get spread over he lifetime. Assuming she had to live for 60 years on that and assuming no inflation, she'd get around 16,000 baht per month. Add in inflation and it will be gone in 10-20 years. You have no idea what you're talking about.

I dont remember suggesting that anyone buy a 10MB condo. In fact I dont remember suggesting that anyone buy anything at all.

What I said was that 235KGBP is a large amount for many Thai people, and I stand by that. It's even quite a large amount for many people in the UK; many people there earn 12,000GBP a year and so 235K would be about 20 years salary. It's also about enough to buy the average UK house.

At 3% the interest alone on 235KGBP would be some 7000GBP, or 30KTHB per month without touching the capital. And of course one probably would look for better total returns than that.

Now, if you want some ideas about what I would do if I was a Thai aged perhaps 30 with 235KGBP, I would buy a modest property to live in and a couple more to rent out. And I would carry on working at some job I enjoyed. And as a result I would probably be several times better off than most other people doing the same job as me.

But of course I dont know what I'm talking about so maybe I should just go back to counting my money.

Edited May 5, 2014 by KittenKong

[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.

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.

Not true. My wife is a joint account holder in the IOM so there is no Probate problem and no fees to pay. Also probate dosen't need specialist services. Most good accountant firms do it all the time.

I am sure the accountants will be interested to hear that you do not consider them to be specialists.

You speak of bank bank accounts but many individuals have sole holdings of investment funds. Offshore probate still incurs hefty fees - whoever does it.

[a99az]

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!

Irresponsible would be not having the funds to leave the child. What about dropping dead at an early age is that also irresponsible.

I am 63 and have two small girls one of 4 and one of 7 was I irresponsible? My wife wanted to have children why should I deny her. I am pissed off with people who judge others for having children later in life. I would never want to be with out them they are the love of my life.

[Jip99]

Not if you are non-resident. Anyway, the return is dreadfully low.

Non-residents certainly can buy premium bonds: http://www.nsandi.com/savings-premium-bonds-other-ways-apply

The return depends on how lucky you are. I am satisfied with mine and there is always the possibility of a large win. I don't suppose I would ever put more than a couple of percent of my total wealth into them though.

Well I'll be, it seems they can. The last time I checked on this was about seven years ago and I'm pretty certain at the time non-resident for tax purposes individuals could not - or perhaps I'm thinking of other nsandi accounts, now I'm unsure! Regardless, apologies for the disinformation.

I got GBP 75 this month

You need a UK bank account to receive prizes and deposit/withdraw monies online.

A UK postal address is also required.

Edited May 5, 2014 by Jip99

[malcolminthemiddle]

Succession planning should be a concern for all of us over 50 and is more of a challenge living in a foreign country with a younger family. There are tax efficient products out there which are readily available in Thailand that are designed for exactly such situations. There are management fees involved and the returns obviously depend on the underlying funds. They can be used for a regular or irregular income, education planning, can be held in joint names and multiple currencies and can be added to at any time. Great care should be taken when setting up these plans because the structure is rigid once established.

[khunPer]

»I should explain that my daughter is 100% Thai, my wife and I adopted her when she was three weeks old. She is now six speaks very good English, she attends a private school where she is doing well, loves books and has an enquiring mind.

I think a good international school is out of our league, but hopefully good state schools with an English programme would set her up for university. I have no problem being her dad at my age we have a great time.«

Just wish to mention, that a way to secure school tuition fees etc. at fairly low risk may be a Thai bond Fund Book with the amount you wish to set aside for education, for example 1 or 2 million bath or whatever…

The bonds give you little more outcome, in tax-free capital gain, than the average interest on a fixed 12-month bank account, where 15 percent tax also is withheld. In average the annual net-gain has been around 2½ to 3 percent the last few years. You can sell bonds at any time day-to-day, whereas a fixed bank account gives an interest loss if not withdrawn at the correct time, to pay for school terms etc. In a Thai Will you can stipulate, that the Fund Book is for your daughter’s education and that a named person is to be guardian.

I use bond Fund Book for all short-term savings – like transferring fund for next years budget in one go when currency exchange is favorable and deposit in Fund Book, obtaining a better interest than a normal European bank account. The money is easily accessible so I can sell for the next couple of month budget at any time and move to an ATM account. I also use a bond Fund Book for the money I save up for my daughters (private English-program) school fees, so I’m always a couple of years ahead and can redraw when the semi-annual terms have to be paid for.

[MarcIssan]

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.

I am selling my company in the USA and have a similar issue. I like the idea of ETF's..

Exchange Traded Funds. My broker in the US has performed at 14% over the mix of exchanges for 3 years running and some in emerging markets are close to 100%. Bio-tech and energy are my favorites. Using a broker I tell him my income needs and he moves between exchanges quarterly to achieve this while reducing risk.

There is a lot written about them. Decide for yourself.

[chiang mai]

From experience, Americans in their home market have access to a far greater spectrum of financial products and advice than average Brits do at home, cheaper, more accessible and more transparent.

[socrates28]

I have sat back and read everyones advice so far

Here is my take on things

I would definitely be buying an asset in UK - its never going to go down in price over the long term and can always be cashed in at some point

I would look to buy a Commercial Property with a nice long lease and a good covenant

The main advantages are it will be on a FRI - Full Insuring and Repairing Lease - this means you will have nothing to do apart from collect rents

It can be purchased by an offshore company giving all sorts of tax benefits with a Trust set up behind it - as long as you remain overseas and do not visit the UK for more than 180 days over any 4 consecutive years you will be fine

Naturally you will pay 20% Tax - of which you can offset all expenses but the property will be devoid of any inheritance tax

Also - which is the most important thing to me is that it can be protected from any money hungry people that come along in the future - no-one knows who their kids are going to marry - so it can be set up to merely produce an income but cannot be sold or form any part of a divorce settlement

Once you have rent money this can then be appropriated as you wish via all the other options and opinions given by others

These properties can be bought outside of London and could be a small Bank Branch or a Bookies or small supermarket etc etc - and it is possible to achieve 8% plus - under that yield it is not worth doing

[AnotherOneAmerican]

200k in British pounds in a British bank account at age 71.

What to do.

50k property in Thailand, purchased in the kids name, nobody can sell it until she is 20years old.

Somewhere near a big city, Chiang Mai, Hua Hin, Bangkok, Chiang Rai.

You can rent it out for her. Do not under any circumstances allow it to be registered in anyone elses name no matter what anyone tells you. The kid can own it outright herself.

150k spread around several Thai banks (7 should do the trick) in your name, earning about 3%.

Write in the back of each bank book who should get the money if you die, ask the bank if they want any other forms filled in.

At 71, forget about investing, too much risk of fraud by IFA or UK tax liability on death (40% I believe).

Remember, if living in a foreign country you have no protection from the financial watchdogs in your home country, no matter where or who you invest with.

There appear to be no legit foreigner originated financial advisors in Thailand, all seem to be working unregistered with the Thai SEC and therefore crooks. No Thai SEC number = crook.

IoM is also full of crooks, not only crooked advisors but crooked investment companies, avoid IoM.

Also note

Thai based forums do not allow anyone dodgy in Thailand to be named or posted about due to Thai defamation laws.

If the company/lawyer/advisor you are thinking of using in Thailand is crooked, you won't find any reports of that nature on the internet.

A house for her in Thailand, and money for you in the Thai bank is about the best bet for someone of your age.

Edited May 5, 2014 by AnotherOneAmerican

[Jip99]

»I should explain that my daughter is 100% Thai, my wife and I adopted her when she was three weeks old. She is now six speaks very good English, she attends a private school where she is doing well, loves books and has an enquiring mind.

I think a good international school is out of our league, but hopefully good state schools with an English programme would set her up for university. I have no problem being her dad at my age we have a great time.«

Just wish to mention, that a way to secure school tuition fees etc. at fairly low risk may be a Thai bond Fund Book with the amount you wish to set aside for education, for example 1 or 2 million bath or whatever…

The bonds give you little more outcome, in tax-free capital gain, than the average interest on a fixed 12-month bank account, where 15 percent tax also is withheld. In average the annual net-gain has been around 2½ to 3 percent the last few years. You can sell bonds at any time day-to-day, whereas a fixed bank account gives an interest loss if not withdrawn at the correct time, to pay for school terms etc. In a Thai Will you can stipulate, that the Fund Book is for your daughter’s education and that a named person is to be guardian.

I use bond Fund Book for all short-term savings – like transferring fund for next years budget in one go when currency exchange is favorable and deposit in Fund Book, obtaining a better interest than a normal European bank account. The money is easily accessible so I can sell for the next couple of month budget at any time and move to an ATM account. I also use a bond Fund Book for the money I save up for my daughters (private English-program) school fees, so I’m always a couple of years ahead and can redraw when the semi-annual terms have to be paid for.

Premium Bonds are more fun though!

[KittenKong]

You need a UK bank account to receive prizes and deposit/withdraw monies online.

Correct. Though it doesn't have to be onshore.

A UK postal address is also required.

Incorrect.

[chiang mai]

I can't be that bothered to look into it right now (but I will) but there is an issue with nsandi accounts and expats, be it bonds or or whatever and I do believe that UK residency or having a UK address is at the heart of matters, unless everything has changed 180 degrees in recent years?

[KittenKong]

I can't be that bothered to look into it right now (but I will) but there is an issue with nsandi accounts and expats, be it bonds or or whatever and I do believe that UK residency or having a UK address is at the heart of matters, unless everything has changed 180 degrees in recent years?

I have held premium bonds overseas for many years. If you live outside the UK the ID checks are more complex, but that's all:

http://www.nsandi.com/contact-us-helpful-information-faqs-proof-identity

[chiang mai]

Holding such instruments long term is one thing, opening them today is likely different.

[socrates28]

The reality is this

For any type of investment or financial product in the UK - you have to complete Money Laundering forms

That is apart from any product that is provided by the UK Government

Go figure......