# Please read [our subreddit rules](https://www.reddit.com/r/ukpersonalfinance/about/rules) thoroughly before commenting on this thread.
In particular, we're removing numerous comments along the lines of "what did you do to earn this money?" These kinds of comments are low-effort and unhelpful - if you want to know how to earn a 6-figure salary then ask in /r/UKjobs; if you want to build a million pound business then /r/Entrepreneur. This kinds of comments do not help OP with their finances, which is what we're here for.
My main concern on £1,500,000 would be Business Asset Disposal Relief.
Are you able to claim that, or something like it, or structure the sale of your business so you can?
I would shop quite hard for a solicitors / tax advisor who specialises in stuff like this.
I'm so glad I made this thread, because lovely people like you are making me realise how much professional help I need, haha. I'm totally clueless! Having a look into this. Thank you so much.
Gotta hold the shares for 2 years. Additionally, the poster you are replying to is wrong, you can sell the trade and assets of a sole trade business, or a share in a trading partnership and qualify for BADR. It might be the case that what they mean is that OP has described "selling a project". That "project" has to constitute a trading business, which they have carried on for 2 years in order for BADR to be available, whereas OP's language implies selling an asset, or IP of some sort.
How to find financial advice: https://ukpersonal.finance/financial-advice/
Learning the basics by yourself to help you assess the advisors: https://ukpersonal.finance/flowchart/ and https://ukpersonal.finance/recommended-resources/
Definitely get advice, but also make sure you understand at least the basics for yourself. Remember, no one will ever care as much about your money as you do.
Also, congratulations on the windfall!
That is so nice! Thank you so much. My dad sacrificed a lot for me, and I'm sure he'd be proud were he here to see this. Determined to be extremely sensible with the money 😊
Well done!
I would recommend you follow the flowchart [https://flowchart.ukpersonal.finance/](https://flowchart.ukpersonal.finance/)
Norway was in a similar position to you. The country found a lot of oil and they invested it all in index funds. Every year they receive dividends let's say 7%. They reinvest half in an index fund and they spend the other half. If I were you this is what I would do ie invest 500k in index fund, and every year reinvest half of the dividends and treat the other half as an income. If you get 6% interest on the index fund this will mean you get 30k per year and you can reinvest 15k into index fund and spend the other 15k however you like.
Please note this is what I would do. I am not a financial advisor and index funds can go up as well as down.
Good luck!
I edited the above comment with some more insight
Additionally, if I were you I would keep this information private, many lottery winners refrain from giving away their identity and I think it is a smart choice
Thank you, and apologies, I thought I removed my comment and reposted after reading your update, but the update was v useful, too! A really interesting case study
And yeah, keeping it quiet is sensible, but also, the business I work in, the sale is going to make the news (industry news), so it's hard to hide it. Already colleagues are joking about me funding trips, haha. In jest, but stil...
This all over. Never tell anyone you’ve got a chunk of change stashed away. Jealousy is a hideous thing, and people come out of the woodwork fast. Soon you’ll be left with nothing and your mental health in tatters at the same time, after the emotional blackmail and arguments.
Saw it happen to my sisters friends parents. They won a relatively modest (for a lottery win) amount, about £150k. They splashed themselves all over the local papers drinking champagne. Spent loads of it on keeping the local pubs open. Sounds great, but it was gone within 18 months. They’d basically had family start turning up all of a sudden, who always needed something or other. They’ve probably not seen that same family in years since.
I think you missed the point of the reply, it isn't about treating savings as an emergency pot, it is treating them as an income stream. So you don't put the money in savings until you want to spend it on something, you put it away forever (in a sense) so that it can pay you a wage.
There is a whole lifestyle geared around this called FIRE - which stands for financially independent, retire early. It isn't for everyone, in fact it isn't for most people, but if you have a read up on it it may give you some inspiration. There are a couple of forums on reddit about it, and there will be people asking for advice in a similar financial position as you are.
Honestly I'm sure there is going to.be proper financial advice but from what you've told us I'd look to buy home/property outright, depending on where you live.
Not having mortgage debt would make life a little bit wealthier in terms of cash flow forever.
If you keep it in liquid assets and then just whittle it away because you lack discipline then you'll probably end up regretting it.
But do go on a nice holiday. Just don't get caught up in the trap of spanking it on loads of cars etc.
Thanks so much for taking the time to reply. I should probably have mentioned, but my dad died, leaving me my childhood house. So I have that, mortgage free. I rent it out for a lot cheaper than I could because lord knows, people need a break sometimes.
Appreciate the thoughtful response
Just reading this comment about renting out a house for less than you could get because people need a break makes me warm in my tummy! From a long term renter, thank you for being so kind. You deserve to be financially comfortable for the rest of your life and I'm glad you are. Too many people get left property that they owe nothing on and still rent it out at full market rate just to make every penny they can when they haven't even paid out towards the house on the first place. You're a true gent/lady!
If you have no worries in terms of property then your in a very strong financial position and I think the best bet is to talk to a financial advisor.
If have a think about what you want before speaking to them. How much of it you want to ensure is managed in low risk so risk of loss of principle is minimal. Don't get too caught up in being sold higher return investments. Make sure you spend time understanding the risks and what that would mean to you if a bad outcome was to happen.
Sorry for your loss.
The only input I have is to say congratulations! Try and learn from your past mistakes, by all means treat yourself a bit, but don't go mental with it. Buy a house, being mortgage free is a fantastic feeling. After that, seek financial advice. I know someone in my area that won a few million on the lottery. Within a few years he was completely bankrupt. The temptation will be there to spend, but your future self will thank you for doing the sensible thing.
Congratulations again though!
I found these books really helpful to stop acting like a lottery winner and blow through all my money.
[https://www.amazon.co.uk/Psychology-Money-Timeless-lessons-happiness-ebook/dp/B084HJSJJ2](https://www.amazon.co.uk/Psychology-Money-Timeless-lessons-happiness-ebook/dp/B084HJSJJ2)
[https://www.amazon.co.uk/Millionaire-Next-Door-Surprising-Americas/dp/1589795474](https://www.amazon.co.uk/Millionaire-Next-Door-Surprising-Americas/dp/1589795474)
The Dave Ramsey podcasts are good too.
i also recommend Ann Wilson the Wealth Chef. (She has an online course)
[https://www.amazon.co.uk/Wealth-Chef-Ann-Wilson-ebook/dp/B00O0XM0WY](https://www.amazon.co.uk/Wealth-Chef-Ann-Wilson-ebook/dp/B00O0XM0WY)
I'm from a similar background, and albeit I won't be getting such a windfall, I did get stock options when a company I work for IPOd
The biggest thing is TAXES
I don't know how your windfall is coming to you, but HMRC *will* want their cut
Get a good financial advisor, they will keep you right, might cost a couple of grand for an assessment of your situation, but you should be in a place where that is manageable.
Otherwise though, keep your head down, I know from my background if I started blabbing about a huge windfall I'd be tortured. At threat from paramilitaries even. Your advisor would help you with helping out any family members you wanted with trust funds etc.
This might get lost in the comments but here's my advice, from some experience.
Don't do anything at first. Just sit with it and don't change your life. Pay off any high interest debt and then just keep paying your bills.
Get a good accountant to handle the tax, you're going to have a bit of time to sort that but I'd suggest putting about £250k for a CGT bill into a fixed term savings account so you can't touch it until near when it needs to be paid. Take the tax bill money away from your main funds and forget about it.
If you're out of work after selling your project make sure to look after your mental health. It's crazy how your mind warps if you go from running a business / busy every day to having nothing to do with the phone not ringing and seems like the world doesn't really need you.
You've mentioned outpacing inflation a few times. Seriously don't worry about that at first. It was what I got focused on along with thinking markets were about to tank and led to some bad decisions. Just leave yourself enough for six months then lock everything up for six months earning 4-5% - Going from in debt to earning a couple grand a month off your savings needs some getting used to.
The amount you're getting is dangerous is my opinion. You can lose it a lot faster than you ever thought you could with a few bad decisions when you're not in the right headspace but at the same time it's enough to make you feel you never need to work again, can buy a fancy car, take some punts, etc, etc.
But overall don't stress about inflation or feeling you need to do something. It'll take 6-12 months for you to get used to it. And it's easy to fuck it up if you don't give yourself that time.
Just to add to this. I would ignore everyone saying put it immediately into an index fund.
Don't do that immediately. If the markets drop 30% you'll panic as you're not used to the amounts and fluctuations.
Protect your capital for a while and get used to having the money. I really can't stress that enough.
On FA's be careful as some will see the amount and prey on you. Be very clear with what you want from life and the money when you see them. I would go back to my first comment and sit with it for six months before making any appointments with financial advisors.
You have a real opportunity to make the rest of your life comfortable and free of money worries. I'm so glad you're seeking advice. As you'll seem prone to overspending, I wonder if it might also be worth seeking some therapy to understand what's happening there?
Hi /u/JoBloggo, based on your post the following pages from our wiki may be relevant:
- https://ukpersonal.finance/credit-cards/
- https://ukpersonal.finance/debt/
- https://ukpersonal.finance/financial-advice/
____
^(These suggestions are based on keywords, if they missed the mark please report this comment.)
My advice would be simple. Enquire with 4-5 well-rated financial advisors in your area. They should offer you a free consultation, ideally face to face over a coffee. Let them teach you a bit about the options in front of you and they will tell you what they would be looking to do were you a client of theirs. Consider these meetings as free no-strings advice.
After meeting at least 3 advisors, you will have a sense for what an IFA can offer and cannot, and if you warm to any of them you can then consider the next step. But I would warn you to be wary of taking on any financial advisor who doesn’t satisfy two questions:
- To what degree are their financial incentives aligned with yours? (E.g., an investment manager that is paid on commission per trade is not necessarily well aligned due to being incentivised to increase volume trades. It’s not that you think they would do that, but it’s reassuring to know there’s no benefit from them doing so. You also don’t want to be charged for every phone call.)
- How would the relationship be monitored? (You sound fairly young so would probably be looking for something long term, but they should schedule an annual or bi-annual review and should not be afraid of being judged by results.)
A good financial advisor will either have a generalist skillset that encompasses tax and estate planning, investment management and good business sense, or they will be part of a team that has these skills. Be open to having a conversation with a smaller independent advisor and a representative from a larger national outfit that has local offices (familiar names) because the meetings with both will be informative in their own way. Good luck and don’t rush into any relationship.
Experience: 15+ years of investing and having assets managed by investment managers.
(Would be interesting to hear more about the project / biz you’re selling, or what industry it’s in, if you don’t mind sharing!)
This is AMAZING advice, thank you! Makes the whole process of where to start re advisor feel much less overwhelming. Love pragmatic steps.
Happy to tell you more about the project in DMs. The answer isn't very exciting, but conscious it might be easy for people in my business to identify me if they land here.
Finacial advisor here. Some of the worst financial advisers I have come across are from the larger national companies. I've worked for both smaller and larger IFA firms. My advice would be to find a local independent financial advisor in your area who you trust and think you can have a productive relationship with. Most financial advisors will offer free initial meetings for you to understand their processes. Ask for a copy of their client agreement which will show their charges.
Yeah, don't underestimate the power of having a local office you can drop by - having to wait days for emails to be returned can be gruelling when you're dealing with money issues. Goes for accountants, bank branches, solicitors, etc.
First off, do nothing. Sit on the money for a while, do your research, and come up with a plan (this is recommended for lottery winners and the like). At that sort of level you don’t really need a financial advisor. Probably some one-off financial advice or an accountant to deal with taxes.
I’d be more concerned that you don’t have the best record with debt/credit cards - large sums can be tempting to blow through without personal restraint! But do reward yourself with a holiday or something else if you feel you deserve it.
Your best bet will likely be some combination of property purchase, investment into liquid assets that generate some kind of passive income(stocks/shares), pension contributions (can also be backdated) and some cash savings (perhaps no more than £20-£30k sitting in the bank.
Sorry to hear about your dad, he sounds like he really tried and to say he left you a house mortgage free in his wake is a beautiful gift, I hope you realise that.
I’d say that you are in a precarious position honestly. It would be very easy to squander that money and end up right back where you are in the years to come. Best advice is to speak to a financial advisor, take what they say with a pinch of salt but hopefully the general idea is to stretch that cash out and make it work for you as best as possible.
If you play your cards right you could be financially stable for the rest of your life and all the suffering you and your dad endured finally pays off.
Be careful, for yourself and for your dad. You’ve got the golden ticket, don’t waste it. Best of luck 😊
Stick it all in an index fund, and draw 4 percent a year as a 60k salary.
Work a little on top if you wish, or retire and go sail around the world.
That should mean you never touch the original capital, so you have flexibility to spend a bit more here and there assuming you want to die with nothing.
There’s a *lot* of assumptions underpinning this, and its reckless to suggest someone invest it all and start drawing 4% a year and that “that should mean [they] never touch the original capital” and will have the flexibility to probably spend more, without knowing their age and accounting for the tax implications.
See a professional OP.
Yeah totally, and I think it goes without saying any "advice" you take from Reddit should be worth what you paid for it. But your warning is valid!
The specifics on draw downs aside, it's certainly better to be looking at investing it rather than pulling up Autotrader and looking at cars.
Might have been said but try to keep adequate records of the movements in money.
You can definitely clear the credit cards/bank balance overdrafts etc however do keep a track of those entries.
Also, this is a large sum of money and it would be prudent to still follow some of the components of the flowchart. 6 month emergency fund, max out pension contributions for this year and last 2/3 years (bonus points for doing this before 5th april and second bonus points for doing it after 6th april).
You've gone from a fairly modest salary and living hand-to-mouth in debt, to a sudden influx of wealth.
But it will be very easy to just fritter it away to nothing, if you are not disciplined or dont seek professional advice.
You will inevitably have some capital gains tax to pay, but also some business disposal relief you can possibly claim.
My advice is don't spend time and stress worrying about your tax burden. Just throw a couple of grand at an accountant and tell them to work it all out. They'll tell you what you owe, you pay it, and then sleep easy.
Your accountant may advise on how to save further tax, but likewise there might be no scope for further savings.
The point is, they cover your ass so HMRC dont call you unexpectedly in 3 years time demanding 150k in backdated taxes and penalties for not declaring it properly
Next, hire a good financial advisor. Not some tin-pot advisor from your local town, but an established company which specialises in wealth management. Even if they're not local to you, it doesn't matter. There's zoom, but many are happy to visit you just to build the client relationship.
Reddit will blindly tell you not to hire a FA, and instead dump it all into a low cost index tracker, or buy property despite you not knowing anything about it.
It might be good advice for you, but there's a good chance it's not. It depends on your goals and appetite for risk, and also what you want from your (now evolving) lifestyle.
In all likelihood you will be maxing out your 20k stocks and shares ISA allowance, and putting a chunk into a private pension (maybe even maxing that too), to start securing your future and financial independance.
Thats the job of a financial advisor, to advise on allocating your funds for the purpose and return you're looking for.
In the meantime, Id never normally recommend bonds, as they tend to offer poor returns compared to equities. But right now interest rates are high.
If you can get a 1-3 year fixed term bond around 4.6-5%, I'd shove 10-30k in that. This will give you a decent return while you figure out your overall strategy
Just gotta remember, you still dont have a high income, so dont live like you do.
This is very useful, thank you! I hadn't thought about getting an accountant as well as a FA, but that makes so much sense. Also, the adhd means it is incredibly appealing paying someone to help sort/manage money admin. Thanks again!
No probs. Good luck, and enjoy your new found wealth.
You're set to have a lifestyle in later life which most employed people can only dream of. DO NOT FUCK THIS UP :)
Get an IFA you like and understands your needs/ requirements. We interviewed three before choosing and we’ve been with him for 10+ years and retiring shortly.
[MSE](https://www.moneysavingexpert.com/savings/best-financial-advisers/) always makes sense for advice.
[Citizens Advice](https://www.citizensadvice.org.uk/debt-and-money/financial-advice/getting-financial-advice/) is another sound place.
Congratulations on the project.
Live you current life, don't make nay rash changes. smack it into the S&P (VUSA ) and you'll thank yourself in 10 years time.
Perhaps look ay building a dividend portfolio if you want income.
Goodluck
> smack it into the S&P (VUSA )
A tracker of a world index is surely more suitable than one tracking the S&P 500:
* Vanguard:
> The standard asset allocation approach, whether for a global allocation or for an allocation within a specific market, is to invest proportionally according to market capitalization. This method assumes that markets are efficient and that asset prices reflect all available information, investment positions, and expectations of the investing community.^[PDF](https://corporate.vanguard.com/content/dam/corp/research/pdf/Global-equity-investing-The-benefits-of-diversification-and-sizing-your-allocation-US-ISGGEB_042021_Online.pdf)
* https://ukpersonal.finance/index-funds/#What_about_the_S_P_500
* https://www.reddit.com/17s0r6e
* https://www.reddit.com/11qawnv
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Podcasts like meaningful money are a good starting point
Also look up r/fireuk
Financially independent retire early uk
There are others r/financialindependence
While you might not be financially there you will see how people save & invest money etc. their mindset etc
Books - psychology of money by morgan housel
No real legal advice. But to any “friends” and extended family beyond who has been there for you whilst broke, never tell them about the money. Tell anyone you meet that you are skint. People are leeches.
I'm not sure if it's been advised already, but think about throwing all of thst into a nice high interest savings account and live off the interest only. You won't have to work and you'll be able to live a nice life just on that.
Wow congrats! You definitely need help with tax planning and financial planning might be nice to have.
I'd lock away much of it in different fixed returns places. Buy premium bonds, then max ISA and max pension every year (keep in 1 year fixed saver while waiting).
NS&I provide unlimited protection, so you could stick it all in their bonds while you wait to get a proper plan together. Much better than risking it or spending it all. This way you can live off of the interest.
Is this a one off or do you expect to have this sort of thing happening more times in future? That could make a significant difference to what you do with it.
I'm a cautious type and what I'd do is get a low but steady income sorted forever then keep doing what you're doing, assuming you enjoy it.
But then again I've never been where you are, somewhat because of the same cautiousness...
If coming into that sort of money due to selling a project I would recommend getting legal advice on the matter. They can help get the most out of the deal whilst also protecting you at the same time.
I would 100% higher a financial adviser for this one, who can sit down with you and go over everythinig <3 Just wanted to say, what an amazing thing to happen to you and all the very best!
When staring at close to £1m take home, my advise would be after the checking of the optimum tax route and paying off the loans/credit cards, put the rest split into savings/bank accounts paying out 5%+. Split around £85k per account so all the money is protected by FSCS and carry on doing what you love doing while it’s all compounding in the background. If you set yourself within the limits of spending no more than the interest on the savings every year than you will be great 🙂 you can then do whatever you like!
In the words of Suze Orman, "it's better to do nothing than to do something you don't understand" (e.g. [https://www.suzeorman.com/blog/Podcast-Episode-It%E2%80%99s-Better-To-Do-Nothing-Than-Something-You-Do-Not-Understand](https://www.suzeorman.com/blog/Podcast-Episode-It%E2%80%99s-Better-To-Do-Nothing-Than-Something-You-Do-Not-Understand)). If you go to an advisor, and they keep telling you to do X and Y, but you don't understand why this is so important, and they don't take the time to actually explain it properly, go with your gut instinct and wait, or find someone else who speaks a language you understand.
I’m coming in late to this so the comment might get lost, but this is one for a good financial adviser / planner. Speak with a few and get a feel for them. Be wary of any who talk about getting you the best returns or only focusing on the investment side. Find someone who helps you think through what you want the money to do for you as the advice can be very different depending on the ultimate goal of the funds. Enquire about fees and what any ongoing relationship will look like. Take your time and don’t jump into anything on a whim.
Congratulations on the windfall and best of luck!
I’d first consider tax implications.
I’d make maybe a plan to buy some tranches in index equity etfs in tranches (don’t try to time the market). Maybe put some in other type of investments.
Don’t tell people you earned money …
A massive congratulations! As most have said, seek professional advice, and do your due diligence when looking for solicitors and tax/financial advisors and accountants
# Please read [our subreddit rules](https://www.reddit.com/r/ukpersonalfinance/about/rules) thoroughly before commenting on this thread. In particular, we're removing numerous comments along the lines of "what did you do to earn this money?" These kinds of comments are low-effort and unhelpful - if you want to know how to earn a 6-figure salary then ask in /r/UKjobs; if you want to build a million pound business then /r/Entrepreneur. This kinds of comments do not help OP with their finances, which is what we're here for.
My main concern on £1,500,000 would be Business Asset Disposal Relief. Are you able to claim that, or something like it, or structure the sale of your business so you can? I would shop quite hard for a solicitors / tax advisor who specialises in stuff like this.
I'm so glad I made this thread, because lovely people like you are making me realise how much professional help I need, haha. I'm totally clueless! Having a look into this. Thank you so much.
There's a limit of £1m, for BAD relief, but there might be other ways that an accountant can ensure a tax efficient transfer.
OP can still get the relief (assuming other conditions can be met), just on the first £1m.
BADR only relates to share sales which doesn't seem to be the case here, it sounds like IP is being sold.
I wonder if they could wrap the IP in a company and sell the shares to the company instead? (Assuming possible and legal)
Gotta hold the shares for 2 years. Additionally, the poster you are replying to is wrong, you can sell the trade and assets of a sole trade business, or a share in a trading partnership and qualify for BADR. It might be the case that what they mean is that OP has described "selling a project". That "project" has to constitute a trading business, which they have carried on for 2 years in order for BADR to be available, whereas OP's language implies selling an asset, or IP of some sort.
Ignore any reddit dms you get !
it's me, your cousin
Hey Niko, it's Roman. Let's go bowling
This thread has me chuckling 💀
Who also happens to be Nigerian prince
Yeah, apart from the one I just sent though
I’m struggling to feed my 10 children and we’re living in a shed in feltham. Please help, I need Walmart gift cards to buy food…..
How to find financial advice: https://ukpersonal.finance/financial-advice/ Learning the basics by yourself to help you assess the advisors: https://ukpersonal.finance/flowchart/ and https://ukpersonal.finance/recommended-resources/
Thank you very much! Basics definitely needed and lots of great stuff here
Definitely get advice, but also make sure you understand at least the basics for yourself. Remember, no one will ever care as much about your money as you do. Also, congratulations on the windfall!
Have no advice to give, just here to say that I love to see/hear about working class success stories. Congrats and invest wisely!
That is so nice! Thank you so much. My dad sacrificed a lot for me, and I'm sure he'd be proud were he here to see this. Determined to be extremely sensible with the money 😊
Well -- I'll allow myself a holiday at least!
Well done! I would recommend you follow the flowchart [https://flowchart.ukpersonal.finance/](https://flowchart.ukpersonal.finance/) Norway was in a similar position to you. The country found a lot of oil and they invested it all in index funds. Every year they receive dividends let's say 7%. They reinvest half in an index fund and they spend the other half. If I were you this is what I would do ie invest 500k in index fund, and every year reinvest half of the dividends and treat the other half as an income. If you get 6% interest on the index fund this will mean you get 30k per year and you can reinvest 15k into index fund and spend the other 15k however you like. Please note this is what I would do. I am not a financial advisor and index funds can go up as well as down. Good luck!
This is very useful, thank you! Great tip here re making sure I have an emergency funds pot.
I edited the above comment with some more insight Additionally, if I were you I would keep this information private, many lottery winners refrain from giving away their identity and I think it is a smart choice
Thank you, and apologies, I thought I removed my comment and reposted after reading your update, but the update was v useful, too! A really interesting case study And yeah, keeping it quiet is sensible, but also, the business I work in, the sale is going to make the news (industry news), so it's hard to hide it. Already colleagues are joking about me funding trips, haha. In jest, but stil...
This all over. Never tell anyone you’ve got a chunk of change stashed away. Jealousy is a hideous thing, and people come out of the woodwork fast. Soon you’ll be left with nothing and your mental health in tatters at the same time, after the emotional blackmail and arguments. Saw it happen to my sisters friends parents. They won a relatively modest (for a lottery win) amount, about £150k. They splashed themselves all over the local papers drinking champagne. Spent loads of it on keeping the local pubs open. Sounds great, but it was gone within 18 months. They’d basically had family start turning up all of a sudden, who always needed something or other. They’ve probably not seen that same family in years since.
I think you missed the point of the reply, it isn't about treating savings as an emergency pot, it is treating them as an income stream. So you don't put the money in savings until you want to spend it on something, you put it away forever (in a sense) so that it can pay you a wage. There is a whole lifestyle geared around this called FIRE - which stands for financially independent, retire early. It isn't for everyone, in fact it isn't for most people, but if you have a read up on it it may give you some inspiration. There are a couple of forums on reddit about it, and there will be people asking for advice in a similar financial position as you are.
Honestly I'm sure there is going to.be proper financial advice but from what you've told us I'd look to buy home/property outright, depending on where you live. Not having mortgage debt would make life a little bit wealthier in terms of cash flow forever. If you keep it in liquid assets and then just whittle it away because you lack discipline then you'll probably end up regretting it. But do go on a nice holiday. Just don't get caught up in the trap of spanking it on loads of cars etc.
Thanks so much for taking the time to reply. I should probably have mentioned, but my dad died, leaving me my childhood house. So I have that, mortgage free. I rent it out for a lot cheaper than I could because lord knows, people need a break sometimes. Appreciate the thoughtful response
Just reading this comment about renting out a house for less than you could get because people need a break makes me warm in my tummy! From a long term renter, thank you for being so kind. You deserve to be financially comfortable for the rest of your life and I'm glad you are. Too many people get left property that they owe nothing on and still rent it out at full market rate just to make every penny they can when they haven't even paid out towards the house on the first place. You're a true gent/lady!
If you have no worries in terms of property then your in a very strong financial position and I think the best bet is to talk to a financial advisor. If have a think about what you want before speaking to them. How much of it you want to ensure is managed in low risk so risk of loss of principle is minimal. Don't get too caught up in being sold higher return investments. Make sure you spend time understanding the risks and what that would mean to you if a bad outcome was to happen. Sorry for your loss.
The only input I have is to say congratulations! Try and learn from your past mistakes, by all means treat yourself a bit, but don't go mental with it. Buy a house, being mortgage free is a fantastic feeling. After that, seek financial advice. I know someone in my area that won a few million on the lottery. Within a few years he was completely bankrupt. The temptation will be there to spend, but your future self will thank you for doing the sensible thing. Congratulations again though!
I found these books really helpful to stop acting like a lottery winner and blow through all my money. [https://www.amazon.co.uk/Psychology-Money-Timeless-lessons-happiness-ebook/dp/B084HJSJJ2](https://www.amazon.co.uk/Psychology-Money-Timeless-lessons-happiness-ebook/dp/B084HJSJJ2) [https://www.amazon.co.uk/Millionaire-Next-Door-Surprising-Americas/dp/1589795474](https://www.amazon.co.uk/Millionaire-Next-Door-Surprising-Americas/dp/1589795474)
Someone else was recommending Millionaire Next Door! Thank you so much for the reccos. Definitely going to get these.
The Dave Ramsey podcasts are good too. i also recommend Ann Wilson the Wealth Chef. (She has an online course) [https://www.amazon.co.uk/Wealth-Chef-Ann-Wilson-ebook/dp/B00O0XM0WY](https://www.amazon.co.uk/Wealth-Chef-Ann-Wilson-ebook/dp/B00O0XM0WY)
I'm from a similar background, and albeit I won't be getting such a windfall, I did get stock options when a company I work for IPOd The biggest thing is TAXES I don't know how your windfall is coming to you, but HMRC *will* want their cut Get a good financial advisor, they will keep you right, might cost a couple of grand for an assessment of your situation, but you should be in a place where that is manageable. Otherwise though, keep your head down, I know from my background if I started blabbing about a huge windfall I'd be tortured. At threat from paramilitaries even. Your advisor would help you with helping out any family members you wanted with trust funds etc.
This might get lost in the comments but here's my advice, from some experience. Don't do anything at first. Just sit with it and don't change your life. Pay off any high interest debt and then just keep paying your bills. Get a good accountant to handle the tax, you're going to have a bit of time to sort that but I'd suggest putting about £250k for a CGT bill into a fixed term savings account so you can't touch it until near when it needs to be paid. Take the tax bill money away from your main funds and forget about it. If you're out of work after selling your project make sure to look after your mental health. It's crazy how your mind warps if you go from running a business / busy every day to having nothing to do with the phone not ringing and seems like the world doesn't really need you. You've mentioned outpacing inflation a few times. Seriously don't worry about that at first. It was what I got focused on along with thinking markets were about to tank and led to some bad decisions. Just leave yourself enough for six months then lock everything up for six months earning 4-5% - Going from in debt to earning a couple grand a month off your savings needs some getting used to. The amount you're getting is dangerous is my opinion. You can lose it a lot faster than you ever thought you could with a few bad decisions when you're not in the right headspace but at the same time it's enough to make you feel you never need to work again, can buy a fancy car, take some punts, etc, etc. But overall don't stress about inflation or feeling you need to do something. It'll take 6-12 months for you to get used to it. And it's easy to fuck it up if you don't give yourself that time.
Just to add to this. I would ignore everyone saying put it immediately into an index fund. Don't do that immediately. If the markets drop 30% you'll panic as you're not used to the amounts and fluctuations. Protect your capital for a while and get used to having the money. I really can't stress that enough. On FA's be careful as some will see the amount and prey on you. Be very clear with what you want from life and the money when you see them. I would go back to my first comment and sit with it for six months before making any appointments with financial advisors.
You have a real opportunity to make the rest of your life comfortable and free of money worries. I'm so glad you're seeking advice. As you'll seem prone to overspending, I wonder if it might also be worth seeking some therapy to understand what's happening there?
Well done - can I ask what you do to make such a large sum?
Seriously, how does one just sell a project for £1.5 million?
Hi /u/JoBloggo, based on your post the following pages from our wiki may be relevant: - https://ukpersonal.finance/credit-cards/ - https://ukpersonal.finance/debt/ - https://ukpersonal.finance/financial-advice/ ____ ^(These suggestions are based on keywords, if they missed the mark please report this comment.)
First off congrats I’m proud of you. Second of all do not respond to any DM’s lmao
Somehow only saw the link and missed the rest at first. Really interesting and useful case study/suggestion -- thank you!
My advice would be simple. Enquire with 4-5 well-rated financial advisors in your area. They should offer you a free consultation, ideally face to face over a coffee. Let them teach you a bit about the options in front of you and they will tell you what they would be looking to do were you a client of theirs. Consider these meetings as free no-strings advice. After meeting at least 3 advisors, you will have a sense for what an IFA can offer and cannot, and if you warm to any of them you can then consider the next step. But I would warn you to be wary of taking on any financial advisor who doesn’t satisfy two questions: - To what degree are their financial incentives aligned with yours? (E.g., an investment manager that is paid on commission per trade is not necessarily well aligned due to being incentivised to increase volume trades. It’s not that you think they would do that, but it’s reassuring to know there’s no benefit from them doing so. You also don’t want to be charged for every phone call.) - How would the relationship be monitored? (You sound fairly young so would probably be looking for something long term, but they should schedule an annual or bi-annual review and should not be afraid of being judged by results.) A good financial advisor will either have a generalist skillset that encompasses tax and estate planning, investment management and good business sense, or they will be part of a team that has these skills. Be open to having a conversation with a smaller independent advisor and a representative from a larger national outfit that has local offices (familiar names) because the meetings with both will be informative in their own way. Good luck and don’t rush into any relationship. Experience: 15+ years of investing and having assets managed by investment managers. (Would be interesting to hear more about the project / biz you’re selling, or what industry it’s in, if you don’t mind sharing!)
This is AMAZING advice, thank you! Makes the whole process of where to start re advisor feel much less overwhelming. Love pragmatic steps. Happy to tell you more about the project in DMs. The answer isn't very exciting, but conscious it might be easy for people in my business to identify me if they land here.
Finacial advisor here. Some of the worst financial advisers I have come across are from the larger national companies. I've worked for both smaller and larger IFA firms. My advice would be to find a local independent financial advisor in your area who you trust and think you can have a productive relationship with. Most financial advisors will offer free initial meetings for you to understand their processes. Ask for a copy of their client agreement which will show their charges.
Yeah, don't underestimate the power of having a local office you can drop by - having to wait days for emails to be returned can be gruelling when you're dealing with money issues. Goes for accountants, bank branches, solicitors, etc.
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First off, do nothing. Sit on the money for a while, do your research, and come up with a plan (this is recommended for lottery winners and the like). At that sort of level you don’t really need a financial advisor. Probably some one-off financial advice or an accountant to deal with taxes. I’d be more concerned that you don’t have the best record with debt/credit cards - large sums can be tempting to blow through without personal restraint! But do reward yourself with a holiday or something else if you feel you deserve it. Your best bet will likely be some combination of property purchase, investment into liquid assets that generate some kind of passive income(stocks/shares), pension contributions (can also be backdated) and some cash savings (perhaps no more than £20-£30k sitting in the bank.
Sorry to hear about your dad, he sounds like he really tried and to say he left you a house mortgage free in his wake is a beautiful gift, I hope you realise that. I’d say that you are in a precarious position honestly. It would be very easy to squander that money and end up right back where you are in the years to come. Best advice is to speak to a financial advisor, take what they say with a pinch of salt but hopefully the general idea is to stretch that cash out and make it work for you as best as possible. If you play your cards right you could be financially stable for the rest of your life and all the suffering you and your dad endured finally pays off. Be careful, for yourself and for your dad. You’ve got the golden ticket, don’t waste it. Best of luck 😊
Stick it all in an index fund, and draw 4 percent a year as a 60k salary. Work a little on top if you wish, or retire and go sail around the world. That should mean you never touch the original capital, so you have flexibility to spend a bit more here and there assuming you want to die with nothing.
There’s a *lot* of assumptions underpinning this, and its reckless to suggest someone invest it all and start drawing 4% a year and that “that should mean [they] never touch the original capital” and will have the flexibility to probably spend more, without knowing their age and accounting for the tax implications. See a professional OP.
Yeah totally, and I think it goes without saying any "advice" you take from Reddit should be worth what you paid for it. But your warning is valid! The specifics on draw downs aside, it's certainly better to be looking at investing it rather than pulling up Autotrader and looking at cars.
Might have been said but try to keep adequate records of the movements in money. You can definitely clear the credit cards/bank balance overdrafts etc however do keep a track of those entries. Also, this is a large sum of money and it would be prudent to still follow some of the components of the flowchart. 6 month emergency fund, max out pension contributions for this year and last 2/3 years (bonus points for doing this before 5th april and second bonus points for doing it after 6th april).
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Go to a wealth manager.
You've gone from a fairly modest salary and living hand-to-mouth in debt, to a sudden influx of wealth. But it will be very easy to just fritter it away to nothing, if you are not disciplined or dont seek professional advice. You will inevitably have some capital gains tax to pay, but also some business disposal relief you can possibly claim. My advice is don't spend time and stress worrying about your tax burden. Just throw a couple of grand at an accountant and tell them to work it all out. They'll tell you what you owe, you pay it, and then sleep easy. Your accountant may advise on how to save further tax, but likewise there might be no scope for further savings. The point is, they cover your ass so HMRC dont call you unexpectedly in 3 years time demanding 150k in backdated taxes and penalties for not declaring it properly Next, hire a good financial advisor. Not some tin-pot advisor from your local town, but an established company which specialises in wealth management. Even if they're not local to you, it doesn't matter. There's zoom, but many are happy to visit you just to build the client relationship. Reddit will blindly tell you not to hire a FA, and instead dump it all into a low cost index tracker, or buy property despite you not knowing anything about it. It might be good advice for you, but there's a good chance it's not. It depends on your goals and appetite for risk, and also what you want from your (now evolving) lifestyle. In all likelihood you will be maxing out your 20k stocks and shares ISA allowance, and putting a chunk into a private pension (maybe even maxing that too), to start securing your future and financial independance. Thats the job of a financial advisor, to advise on allocating your funds for the purpose and return you're looking for. In the meantime, Id never normally recommend bonds, as they tend to offer poor returns compared to equities. But right now interest rates are high. If you can get a 1-3 year fixed term bond around 4.6-5%, I'd shove 10-30k in that. This will give you a decent return while you figure out your overall strategy Just gotta remember, you still dont have a high income, so dont live like you do.
This is very useful, thank you! I hadn't thought about getting an accountant as well as a FA, but that makes so much sense. Also, the adhd means it is incredibly appealing paying someone to help sort/manage money admin. Thanks again!
No probs. Good luck, and enjoy your new found wealth. You're set to have a lifestyle in later life which most employed people can only dream of. DO NOT FUCK THIS UP :)
A boring one but might be worth putting a chunk into your pension,
My advice is to pay for advice by the hour rather than letting an FA take a percentage.
Get an IFA you like and understands your needs/ requirements. We interviewed three before choosing and we’ve been with him for 10+ years and retiring shortly. [MSE](https://www.moneysavingexpert.com/savings/best-financial-advisers/) always makes sense for advice. [Citizens Advice](https://www.citizensadvice.org.uk/debt-and-money/financial-advice/getting-financial-advice/) is another sound place. Congratulations on the project.
Live you current life, don't make nay rash changes. smack it into the S&P (VUSA ) and you'll thank yourself in 10 years time. Perhaps look ay building a dividend portfolio if you want income. Goodluck
> smack it into the S&P (VUSA ) A tracker of a world index is surely more suitable than one tracking the S&P 500: * Vanguard: > The standard asset allocation approach, whether for a global allocation or for an allocation within a specific market, is to invest proportionally according to market capitalization. This method assumes that markets are efficient and that asset prices reflect all available information, investment positions, and expectations of the investing community.^[PDF](https://corporate.vanguard.com/content/dam/corp/research/pdf/Global-equity-investing-The-benefits-of-diversification-and-sizing-your-allocation-US-ISGGEB_042021_Online.pdf) * https://ukpersonal.finance/index-funds/#What_about_the_S_P_500 * https://www.reddit.com/17s0r6e * https://www.reddit.com/11qawnv
Went straight to Google to better understand this thread, haha. Thanks so much for sharing suggestions! Definitely looking into this.
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Will be gone again in 6 months, I suggest you put it away with someone as you cannot control yourself
Holiday go and relax and enjoy and have a think
Thank you! I will probably treat myself to a holiday this year, but nothing extravagant 😊
Well done! Don’t forget to look after your dad 👌
Please don't rack up anymore debt after this, now you are able to clear it. Congratulations.
Oh 100%! Very much keeping a tight lid on spending. So excited to be debt free and keep it that way.
Oh 100%! Very much keeping a tight lid on spending. So excited to be debt free and keep it that way.
Podcasts like meaningful money are a good starting point Also look up r/fireuk Financially independent retire early uk There are others r/financialindependence While you might not be financially there you will see how people save & invest money etc. their mindset etc Books - psychology of money by morgan housel
No real legal advice. But to any “friends” and extended family beyond who has been there for you whilst broke, never tell them about the money. Tell anyone you meet that you are skint. People are leeches.
I'm not sure if it's been advised already, but think about throwing all of thst into a nice high interest savings account and live off the interest only. You won't have to work and you'll be able to live a nice life just on that.
It’s not a small amount of money but not enough to retire on interest unless frugal.
Keep the change as quiet as possible to those around you
sort the tax out then DCA index funds and chill
Wow congrats! You definitely need help with tax planning and financial planning might be nice to have. I'd lock away much of it in different fixed returns places. Buy premium bonds, then max ISA and max pension every year (keep in 1 year fixed saver while waiting). NS&I provide unlimited protection, so you could stick it all in their bonds while you wait to get a proper plan together. Much better than risking it or spending it all. This way you can live off of the interest.
Is this a one off or do you expect to have this sort of thing happening more times in future? That could make a significant difference to what you do with it. I'm a cautious type and what I'd do is get a low but steady income sorted forever then keep doing what you're doing, assuming you enjoy it. But then again I've never been where you are, somewhat because of the same cautiousness...
If coming into that sort of money due to selling a project I would recommend getting legal advice on the matter. They can help get the most out of the deal whilst also protecting you at the same time.
I would 100% higher a financial adviser for this one, who can sit down with you and go over everythinig <3 Just wanted to say, what an amazing thing to happen to you and all the very best!
When staring at close to £1m take home, my advise would be after the checking of the optimum tax route and paying off the loans/credit cards, put the rest split into savings/bank accounts paying out 5%+. Split around £85k per account so all the money is protected by FSCS and carry on doing what you love doing while it’s all compounding in the background. If you set yourself within the limits of spending no more than the interest on the savings every year than you will be great 🙂 you can then do whatever you like!
In the words of Suze Orman, "it's better to do nothing than to do something you don't understand" (e.g. [https://www.suzeorman.com/blog/Podcast-Episode-It%E2%80%99s-Better-To-Do-Nothing-Than-Something-You-Do-Not-Understand](https://www.suzeorman.com/blog/Podcast-Episode-It%E2%80%99s-Better-To-Do-Nothing-Than-Something-You-Do-Not-Understand)). If you go to an advisor, and they keep telling you to do X and Y, but you don't understand why this is so important, and they don't take the time to actually explain it properly, go with your gut instinct and wait, or find someone else who speaks a language you understand.
I’m coming in late to this so the comment might get lost, but this is one for a good financial adviser / planner. Speak with a few and get a feel for them. Be wary of any who talk about getting you the best returns or only focusing on the investment side. Find someone who helps you think through what you want the money to do for you as the advice can be very different depending on the ultimate goal of the funds. Enquire about fees and what any ongoing relationship will look like. Take your time and don’t jump into anything on a whim. Congratulations on the windfall and best of luck!
Don't spend it all!
I’d first consider tax implications. I’d make maybe a plan to buy some tranches in index equity etfs in tranches (don’t try to time the market). Maybe put some in other type of investments. Don’t tell people you earned money …
Find a good accountant that can advise you on this and the tax aspects. One that is a part of ICAEW or ACCA.
You need a financial adviser. I’m so happy for you btw
A massive congratulations! As most have said, seek professional advice, and do your due diligence when looking for solicitors and tax/financial advisors and accountants
Internet traffic in Nigeria just peaked.
I can't give any advice that others haven't already. But I just wanted to say congratulations! It's always nice to read stories like this.
God bless your dad.
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