What to do with a surprise windfall

Everyone loves a financial windfall, but what to do with the money to make the most of your good fortune? Ginny asks Noel Whittaker for his advice.


Q. Ginny
I have just received a windfall gain of $10,000 from my late uncle’s estate. I am 68 and fully retired, on a part-Age Pension, with about $150,000 in my super. I own my flat, without a mortgage. I would like to buy Australian shares, but am not sure if that is the best way to invest. Given the volatility of the stock market, I thought maybe a term deposit would be more secure, but the cash rate seems so low. Am I wasting this opportunity?

A. Every investment decision you make has advantages and disadvantages. If you choose cash, you condemn yourself to low returns and no chance of capital growth. If you opt for Australian shares you will get franked dividends and the potential for capital gain, but you will see your capital bounce around when the market does. Maybe it would be worthwhile talking to a good adviser about a conservative income portfolio that invests partly in shares. Alternatively, you could keep part of your money in cash and the balance in an index fund that, by definition, cannot go broke.

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Noel Whittaker is the author of Making Money Made Simple and numerous other books on personal finance. His advice is general in nature and readers should seek their own professional advice before making any financial decisions.

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Noel’s investment strategies
How to have a tax-free retirement
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Financial disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.

Noel Whittaker
Noel Whittakerhttps://www.noelwhittaker.com.au/about/about-noel/
International bestselling author, finance and investment expert, radio broadcaster, newspaper columnist and public speaker, Noel Whittaker is one of the world’s foremost authorities on personal finance. He is currently an Adjunct Professor and Executive-in-Residence with the Queensland University of Technology, as well as a committee member advising the Australian Securities and Investment Commission.
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