Q. I have just retired from dental surgery after 35 years hard work, and plan to really enjoy my retirement years by travelling a lot to far away places. With my NHS lump sum and cash from selling my practice I have a large sum of money to invest.
I want to put money into the stock market but equally want to have cash reserves. How would you suggest is the best way to apportion my money between the two?
A. This is a very important decision to get right, as your investments need to last you perhaps 20-30 years. Our answer here is necessarily brief, but centers on you understanding what you want to do now with your time and how much it costs on top of basic costs.
Ideally you need to then measure these costs against your pension and investments over, say, a 30 year time period. From this you will be able to see the big picture before you look at the detail.
Without this you will be making vital decisions pretty much on guesswork, and issues such as risk, tax and accessibility deserve your full attention. As a rule of thumb we would advise that you have enough cash to mean that you will not need to access your invested money for at least 5-7 years, and preferably longer.
As ever, we appreciate you feel you want to do this yourself, but would recommend you take professional advice as mistakes here could be very expensive.
About Graeme Urwin
