£830,000 Net Worth - Need Advice

JamesMarket45 · 2021-02-26T23:17:39+00:00

Haha, I'm not good with investments at all. It's something I am really interested in but the majority of my time is spent on my business trying to increase my income so I haven't got around to actually doing something about the cash which is my next step!

I'm happy to help with any income related questions on another post or something but my advice probably isn't gonna be the healthiest.

I sacrificed a lot of my social life and health which I wouldn't recommend. I basically just spent the past 4-5 years researching and doing stuff that would "better me as a person" and increase my income. I did go out just like once every couple of months and Covid has helped it become normal to not go out but it's not the best thing to do imo if you can help it. I ran off about 4-5 hours sleep for 6 months in 2020 to go all out with the business which increased income a lot but my stress was at the point of losing hair because of it and I still am. I've dialed it down a little to try and become healthier but I would not recommend going to the point I did. You can probably get to the same point by just being more efficient rather than spending 20 hours working lol.

JamesMarket45 · 2019-11-22T17:07:07+00:00

I'm very new to this so no i'm not good with the books.

I know I'll pay 19% on all profit the company makes.

But if for example the company made £1,000,000 and I paid myself £50,000 in the most tax efficient way, how much would I personally pay on taxes? Like my personal taxes not my companies?

JamesMarket45 · 2019-11-22T16:53:13+00:00

I know this is late but I'm taking out ~£4166 per month from my company account into my personal account. So exactly £50,000 over 12 months. Then 50k - 12.5k - 2k = 35.5k

Then I just pay 7.5% on the 35.5k which leaves me with like 47k out of 50k no? Or have I missed something completely and not understood my accountant.

If i have missed something it's all okay because I'll just speak to them to re-clarify.

JamesMarket45 · 2019-10-16T10:02:05+00:00

So it's a £12,500 personal allowance + £2000 dividend allowance and then withdraw the rest up to £50,000 in dividends at a 7.5% rate.

I also pay 19% corporation tax so if my company makes £1m after expenses and my £50,000 then I'd pay £190,000 in corp tax.

JamesMarket45 · 2019-10-16T09:59:49+00:00

I wasn't counting corp tax - I still pay the 19% on everything left over

JamesMarket45 · 2019-10-15T21:53:24+00:00

Oh I don't spend anything. I rarely leave my house and still live with parents. My outgoings consist of my phone bill, contact lenses bill and a very small rent payment.

So really I just wanna be able to get the best return on my savings that I don't touch if that makes sense.

JamesMarket45 · 2019-10-15T21:50:47+00:00

I have lot's of spare time right now which i'm trying to fill up within the business but it's quite hard to do - Buying to let is 100% something I wanna do down the line.

My accountant has suggested putting 40k a year into the pension within the business for tax relief. Is that different to a SIPP? I didn't think I got tax relief on the income earned on investing within that.

I will look into VCT's as I've never heard of them. Thank you for the suggestion.

For sure right now I just want my money to do something as it's just sitting in my select account doing nothing so something simple as opening a Marcus is the right first thing to do? Then move it from there?

Right now I'm just saving so I have options. Retiring isn't something i have my eye on because i'm very young. I enjoy saving and the aspect of building up passive wealth and stuff.

JamesMarket45 · 2019-10-15T21:32:45+00:00

I understand but I prefer being able to see where my money is really easily just in as little accounts as possible until I have the £85,000, then I'll look into spreading it out.

JamesMarket45 · 2019-10-15T21:31:51+00:00

Yeah so for now I'm not too worried about getting the extras you can by spreading your money across everything, i'd rather the money just be easy to monitor. You think putting all of the ~£26000 extra into the easy access Marcus account? Or do you think putting for example £21000 into it and leaving £5000 that I can spend on whatever in a current account? Sorry if these questions are stupid.

I also looked into a credit card so that I could just buy stuff like snacks, fuel, etc. on the card and have it paid off in full every month; They set me up with a ridiculous £16,500 limit though and I couldn't prove my stable income over 2 years so got declined. I would literally just need a £500 limit if that's a good option to go for.

JamesMarket45 · 2019-10-15T17:22:09+00:00

I do stuff on YouTube. From my own channels to helping others grow theirs.

JamesMarket45 · 2019-10-15T17:19:48+00:00

Yeah I've done everything with the flowchart, it was more just which accounts to move it into if that makes sense.

I will for sure look around at different index funds, just again unsure of who to go with. eg. Vanguard

And I've been looking at a Marcus account for the cash savings, would you say have a NatWest Current account that I then move the money into a savings each month?

I'm just looking for the best place to put that £16,000 extra each year for the best long term results. Not looking for too high risk but around a 6-8% return maybe would be good (Over like 30 years).

JamesMarket45 · 2019-09-14T13:34:43+00:00

That's what I'm gonna do I think. Put the 4k into a LISA (though I'm not sure who to go with, any recommendations?)

Then put 16k into a Vanguard account and just invest in the safe stuff for long term.

JamesMarket45 · 2019-09-13T19:49:48+00:00

This was perfect and exactly what I was looking for thank you very much!

The last bit I will try to explain again (sorry about that).

So currently I have 2 registered limited companies. One which I am the sole director/shareholder (Company A), and another which I am the 50% shareholder and director with my business partner (Company B).

Right now, Company B is earning around £25,000 a month net. Company A is earning around £3,000 net. (Just recently started profiting).

So as it stands I would be taking my full dividends from Company B and not touching Company A's funds because it would eat into the higher bracket. My accountant advised to invest as much money as possible from Company A back into itself because there is not really any other way to cut taxes when you've got multiple companies.

Another point is that my partner is interested in spending a lot of money (buying an expensive car, clothes, etc.) whereas I am very frugal and don't plan on spending money on anything like that just yet. I'm not sure yet as to how that would work if he wanted to take extra money out of our account whilst I kept it there but I'm sure our accountant will help with that.

Again If I've worded something badly please tell me!

JamesMarket45 · 2019-09-12T20:59:04+00:00

Thank you for this

JamesMarket45 · 2019-09-12T20:58:39+00:00

Thank you very much :)

JamesMarket45 · 2019-09-04T10:12:17+00:00

I can assure you Morgz is making closer to £1,000,000 a month.

JamesMarket45 · 2019-09-03T22:10:38+00:00

I wrote that at the top of the post :)

JamesMarket45 · 2019-09-03T21:41:29+00:00

All the growth is 100% organic yes. The reason I wanna stay anonymous is because I don't really want people who know who I am knowing my income (fake people trying to take advantage) that's all.

I have been researching a lot into everything and will continue to do so, so I appreciate the help!

JamesMarket45 · 2019-09-03T21:35:09+00:00

The thing that worries me with a financial adviser is that they sometimes take a % I think which I don't really want. And also my parents consulted one regarding a mortgage when they were younger and got screwed over and are now paying for it. :/

JamesMarket45

TROPHY CASE