KISS. Or just Stupid?

[Sparkie67]

I think your position is different from most on this board due to having medical available at little cost plus the Australian welfare system.

A couple of issues you might want to consider. If you are planning to spend time overseas you need to hook up with a bank who meets those needs. Basically the big 4 are useless, once they have your money good luck trying to deal with them whilst you are overseas. I would suggest you take a look at Citibank. They have one of the best offers at the moment for Term Deposits. Once you invest $100k with them, you get allocated a personal banker, plus they will work with you over the phone for transfers if you do the right paperwork. They also have worldwide Citigold banking centers that you can use when you are overseas.

Term Deposits, you could always stagger by different denominations and maturity dates. However, Term Deposits are totally different to the US based CD's as if you break at TD you lose big time on the interest, which is why I suggest you stagger denominations and maturity dates.

With the amount of cash you have you could go really aggressive in your superannuation funds within the stock market, so you have your toes dipped in. We have kept our retirement funds in the market to balance against our cash at 7%.

Re buying in the UK. What is your real motivation for doing so? Is it just because of the exchange rate or would you intend to live there long term? I think it is tough playing the exchange rate game and you could easily get burnt. If you are intending to spend time in the UK why not just rent? The real estate market in the UK seems horrendous at the moment with no sign of recovery. Even if you were intending to return to the UK full time to live I would suggest renting for a year to be sure that you do want to stay.

Obviously being a sparky there would be no problems re-entering the work force at any time.

Thanks for the 'Aussie' perspective. The info re the banking is very useful.

Our 'lifestyle' plan is to travel around Oz for a couple of years, and then UK / Europe. I also have a European passport, plus family and friends in the UK. The property purchase plan in the UK is based around this rather than exchange rates. Its just that now is a financially a good time to do it with the rates / house prices as they are. As we see it, a cheap property base would be useful and could be rented out in the meantime or if not required in the future. Any capital growth is secondary to the usefullness, or the rental income at this stage, although would obviously nice in the future.

Given our ages, we don't really want to tie up further funds in superannuation that we can't then get access to. But I agree; our current super is in a 'high growth' / shares only portfolio for the reason you state.

I think for now, a few more calculations are in order, and we'll just have to try to make the best fit we can with our plans / risk profile. I'm trying to look at the next few years as stages, with each stage 'financed' within the broad framework of a WR of 3.5 - 4%, plus some inflationary cover. I guess that looks like 'market timing' and 'stock picking' and chopping and changing, but i'm hoping its not and i'm not deluding myself!

 

[DangerMouse]

I would proceed very cautiously with any purchase of property in the UK. My husband also has a British passport so we lived in the UK for a number of year and probably will end up back in Europe for some time when we quit here.

Renting in the UK can be a very bad idea if you get a tenant who does not pay their rent. I had a friend in that situation, was renting to someone who was getting council benefits so was no reason for unpaid rent. However, to get the said tenant out there were so many court hearings, warnings etc., everything went in the tenant's favour. Took her months to get her out. Also squatter's rights are so strong in the UK you would not want to leave it unoccupied for any extended period of time.

 

[Sparkie67]

I would proceed very cautiously with any purchase of property in the UK..... Renting in the UK can be a very bad idea if you get a tenant who does not pay their rent..... Also squatter's rights are so strong in the UK you would not want to leave it unoccupied for any extended period of time.

Hi. All very valid points. I'm finding all options have negatives . But ultimately we'll have to do something with the cash. In the short term its a term deposit i think. As long as I stay out of US$ i should be right! Beyond that, lots of research and ultimately something that gives me confidence.
Thanks again for your insights