Wealth Check: 'We want to start married life on a secure financial base'

Two years ago, Nick Hepworth transformed his life, giving up his local government job and moving to the Usambara Mountains in Tanzania, where he is studying for a PhD. Nick recently got engaged to his girlfriend, Samantha Ross, also a mature student in Tanzania, and the couple now need to think about their financial futures.

Nick and Samantha's finances are in reasonable shape. Nick owns a house in Lancaster, which has more than doubled in value since he bought it in 2001. The property is rented out at below-market rates, and covers his mortgage repayments. In addition, the couple have savings of around £20,000, held in cash savings accounts, a cash ISA with Triodos bank, an ethical fund run by NPI, and shares in Halifax Bank.

Once Nick and Samantha have finished their studies, they could end up moving almost anywhere in the world. Consultancy work would be lucrative, but they'd also like to set up an NGO, which would be less financially rewarding.

And while they'd like to have a base in the UK, should they keep the current property, or sell up? Then there's the issue of savings and pensions, as the couple think about starting a family in the years ahead.

We asked three independent financial advisers for their suggestions: Anna Sofat, of AJS Wealth Management; Keith Churchouse, of Churchouse Financial Planning; and Justin Modray, of Best Invest.

PROPERTY

Anna Sofat thinks Nick and Samantha should keep their existing property and think of it as an investment. The current mortgage of £59,000 is costing them 5 per cent a year and is easily covered by rent.

To maximise its potential, Sofat wants Nick to invest in improving the property, so that he can charge a higher rent. But she suggests he waits until he has finished his studies or is back in the UK.

Keith Churchouse also thinks smartening up the house makes sense. He suggests taking professional advice from two sources. A lettings agent will help Nick work out how much investment and in what areas would pay off. An accountant could help him offset some costs against tax.

SAVINGS

Justin Modray wants the couple to overhaul their savings. Samantha's savings account pays 4.65 per cent a year and Modray says that while this is reasonable she could do better. Landsbanki's Icesave account, for example, currently pays 5.70 per cent annually. Samantha should also consider a cash ISA, where interest is tax-free on contributions of up to £3,000 a year. Nick's Triodos cash ISA pays 4.5 per cent - he could do better, though the bank fits well with his ethical beliefs.

One option, adds Modray, would be to move some cash into stock market investments. But they must be happy to tie up the money for five to 10 years, and until their plans for the future are a little more certain, that might be a mistake.

As for their existing stock market investments, Modray wants Nick to sell his NPI ethical fund holding and reinvest the cash in F&C's Stewardship Growth fund. It's another ethical fund, but one with a better track record and future performance prospects.

PENSIONS

Private pension investments are a problem for Nick and Samantha, Modray adds. They can't invest in occupational or personal pension plans unless they're resident in the UK for tax purposes. If they continue to live abroad, they'll have to explore other options - the property will help, for example, as will stock market funds. Professional advice will be crucial, however.

Case notes

Nick Hepworth and Samantha Ross, 34, Tanzania

Income: £13,000 a year scholarship while studying for a PhD.

Monthly spending: Disposable income covers living expenses, as well as some savings contributions.

Property: Nick owns a house worth £110,000, with mortgage of £59,000. The house is currently rented out at below-market rates that cover the mortgage repayments.

Savings: The couple have around £20,000 held in a combination of cash, stock market funds and shares in HBoS.

Debts: None.

Pension: Nick spent nine years paying into the Local Government Superannuation Scheme and savings are stil there. But not currently saving for old age.