What will a financial adviser do for me?
Comments
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Car and petrol again.
LISA is a tax wrapper. Not an invesment
Trackers are not a tax wrapper. They are investments.
You can put trackers in a tax wrapper but not tax wrappers into trackers.
Multi-asset fund does seem most suitable. Forget what Tim Hale says. You will get exposure at suitable allocations with multi-asset funds.
Thanks, dunst.
I will have a look for one that is a unit trust and not an ETF so I don't have to reinvest the dividends. More laziness! :rotfl:
Can I ask one last question about ISAs without anyone jumping down my throat...?! Will it be better to hold some of my funds via S & S ISA as any gains (capital and income) from that will be tax free when I eventually cash out (sell)?0 -
Most unit trusts have been turned into Open Ended Investment Companies (OEICs). No practical difference for the investor.I will have a look for one that is a unit trust and not an ETF so I don't have to reinvest the dividends. More laziness! :rotfl:
Note that even ACCumulating funds pay dividends, on which tax is due if held outside a tax wrapper; but they automatically re-invest them in the fund for you.
Yes, always shelter your investments as much as possible. Not only does it save tax - every time you get a dividend, not just when you sell - but it also saves keeping a record of all your purchases and sales, including all the re-invested dividends, to prove to HMRC that you haven't incurred any Capital Gains Tax (or how much CGT you owe).Can I ask one last question about ISAs without anyone jumping down my throat...?! Will it be better to hold some of my funds via S & S ISA as any gains (capital and income) from that will be tax free when I eventually cash out (sell)?
Also note that a LISA can be an S&S LISA, and since the first year's contribution will be in it for at least 20 years, S&S should do much better than cash.Eco Miser
Saving money for well over half a century0 -
So there is a choice. You can blindly use a predefined packaged approach with no understanding of what it does, why/if it works and whether it is actually appropriate for your needs. You can educate yourself in how the overall system works and make your own decisions on the basis of knowledge and understanding. Or you can rely on someone else to do it for you. The second option seems most sensible to me for anyone seriously intending to invest over decades.
Agreed. And I could explain how the overall system works to the degree necessary for a beginner to understand what a multi-asset fund does and why on one side of A4 paper. The second side would list the three big do-nots (don't panic, don't put all your eggs in one basket and don't use gearing) and explain how to start finding a provider through which to buy a multi-asset fund. There's your Getting Started manual.
The idea is that you gain sufficient knowledge to implement a good solution, and implement it, then you start raising your level of knowledge in order to improve your solution. The alternative is to spend months on end reading books during which your funds are still sitting in the bank account losing value.
We are seeing here a classic case of paralysis via analysis. The OP is apparently on his fifth investment book yet doesn't understand the concept of a tax wrapper or where one can buy a multi asset fund because his books have filled his head with irrelevant junk. He has dumped a load of information into his brain with no idea what order it's supposed to go in.0 -
SO dividends are income taxed even if the OEIC reinvests (which I hope they do for me, I don't want the hassle of reinvesting!) Or is it all just liable to CGT when I sell?
Here's some world trackers I am looking at. I did look at HSBC All World Index but the minimum investment is ridiculous! http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000TXY7&tab=5
The options:
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000Q5LZ Initial investment £1k, fees .50%
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000PEVN Initial investment £1k fees .56%
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000P7SJ Initial investment £1k fees 0.60%0 -
Malthusian wrote: »Agreed. And I could explain how the overall system works to the degree necessary for a beginner to understand what a multi-asset fund does and why on one side of A4 paper. The second side would list the three big do-nots (don't panic, don't put all your eggs in one basket and don't use gearing) and explain how to start finding a provider through which to buy a multi-asset fund. There's your Getting Started manual.
The idea is that you gain sufficient knowledge to implement a good solution, and implement it, then you start raising your level of knowledge in order to improve your solution. The alternative is to spend months on end reading books during which your funds are still sitting in the bank account losing value.
We are seeing here a classic case of paralysis via analysis. The OP is apparently on his fifth investment book yet doesn't understand the concept of a tax wrapper or where one can buy a multi asset fund because his books have filled his head with irrelevant junk. He has dumped a load of information into his brain with no idea what order it's supposed to go in.
I'm not I'm on my second!
But what you say is true. I am meeting someone at a high street bank in-branch to see what they say. I am hoping it will fill in the basics that the books neglect for someone like me. 0 -
I'm not I'm on my second! But what you say is true. I am meeting someone at a high street bank in-branch to see what they say. I am hoping it will fill in the basics that the books neglect for someone like me.
A high street bank is probably your worst choice for any advice. If you want advice, see an IFA.0 -
SO dividends are income taxed even if the OEIC reinvests (which I hope they do for me, I don't want the hassle of reinvesting!) Or is it all just liable to CGT when I sell?
Here's some world trackers I am looking at. I did look at HSBC All World Index but the minimum investment is ridiculous! http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000TXY7&tab=5
The options:
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000Q5LZ Initial investment £1k, fees .50%
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000PEVN Initial investment £1k fees .56%
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000P7SJ Initial investment £1k fees 0.60%
Ignore the initial investment figure, it will not apply when you purchase the fund through a platform.
If you want to DIY, take the following steps:
1) Choose the multi-asset fund that you want to invest in.
2) Choose the tax wrapper that you want to use for your investment (ISA or SIPP)
3) Based on 1 & 2 above, choose an appropriate platform based on charges, reviews and how you want to use them
4) Open an account with your chosen platform, transfer your cash, purchase your fund
5) Setup any regular payments and investment if required
6) When your fund reaches say £100K, decide if you want to change from a multi-asset fund to a custom asset allocation over multiple investments.0 -
I am meeting someone at a high street bank in-branch to see what they say.
Don't. Banks are the worst distribution channel. Both on reputation and quality.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Dividends are taxed as income, in the tax year they are received (or reinvested); capital gains are taxed as capital gains, in the tax year that you sell (or give away).SO dividends are income taxed even if the OEIC reinvests (which I hope they do for me, I don't want the hassle of reinvesting!) Or is it all just liable to CGT when I sell?
ACCumulation funds reinvest the dividends, INCome funds pay them out. (Into the cash section of the platform, from where they can be paid to you or invested into something else, or re-invested in the same fund, depending on the options you have chosen. If the fnuds are in an ISA, the cash stays within the ISA unless it is paid out to your bank account.)
That's the institutional class, there will be a retail class with a slightly higher charge and much lower minimum. Or your platform may let you and ten thousand other clients split that minimum amongst you.Here's some world trackers I am looking at. I did look at HSBC All World Index but the minimum investment is ridiculous! http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000TXY7&tab=5Eco Miser
Saving money for well over half a century0 -
I'm not I'm on my second! But what you say is true. I am meeting someone at a high street bank in-branch to see what they say. I am hoping it will fill in the basics that the books neglect for someone like me.
At the risk of overloading you with even more information, have you seen this website?
https://www.moneyadviceservice.org.uk/en/articles/stocks-and-shares-isas
I've linked to the S&S ISA pages, but it covers many other financial topics in straightforward language.
Please don't go to your local bank for information on investments. They will not be able to give you impartial advice, because they are not allowed to, so they will will only tell you about their own or group products. These are likely to be very expensive:(0
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