What to do with money in bank

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    What to do with money in bank

    My finances are quite straightforward - I have a buy to let mortgage of 150k on a flat worth 220k which is £335 a month and a rent of £750.
    I live at my parents but want to be out this year.
    I have a current account with 76k.
    My question is should I use this to buy somewhere to live or should I rent and invest the money elsewhere?
    Many thanks for any responses!

    #2
    I think you'll need it for a deposit on a place of your own, won't you? Well done for saving that much.

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      #3
      Thanks jk0 thats true if I buy a place to live instead of rent. It's expensive where I am so 70k would have to be 30% of a modest 230k property. I reckon I could borrow 150k max with my income.
      I asked the question as I'm not sure about having all my money in one basket (property). I wondered if there were other ways to generate an income if I were to rent instead?

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        #4
        I think there's a lot to be said for owning a home of your own. If locals still make a profit buying rentals on mortgages, any alternative investment you used to rent somewhere would need a fantastic return.

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          #5
          It would be pushing my borrowing to the limit to buy another property. I've ran an eligibility calculator with my max overtime and it says I could borrow 150k. So my budget would be 226 k . Doesn't buy much in Berkshire.

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            #6
            If you are willing to take risk investing in a managed high yield fund , you can get 7% on your £76K = £5000 and over. which helps to pay for renting your own place.

            https://www.barings.com/gb/individua...d/IE00B44M8N80

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              #7
              If your entire net worth is the BTL and £76K you should look at diversifying your money. I'd look at ways of increasing the yield on your existing property and use some of the £76k to buy the top end of dividend paying shares. Wrap those shares into a SIPP (Self Invested Private Pension).

              As for picking shares, there's many guides on the internet but please don't ever get suckered into paying for any online trading courses or seminars, it's 100% snake oil "gurus". Everything you need to know about buying dividend paying stocks can be found for free in all mainstream financial media.

              Another way of making money is P2P lending, just avoid {Mod - read forum rules please - no name & Shame} as they have a bad rep for defaulting loans.

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                #8
                Gordon - 7% sounds great but how risky is it?
                Febuary - yes that's my entire wealth
                im torn between a let-to-rent strategy where I carry on paying off my buy to let and either sell it or evict the tenant when it's paid off then I'm mortgage free.
                Or a leverage strategy where I borrow more money now and pay stamp duty surcharge to get a second property now with the long term hope of prices rising and mortgages relatively getting smaller.

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