ISA Millionaires

Keep_pedalling · 18 March 2018 at 8:45PM

ValiantSon wrote: »

Perhaps you should join us all then, as your literacy is rather substandard. What you wanted to write was, "Ah well, back to school, kids!"

Do you find being rude and obnoxious wins you many friends?

You have to make allowances, his first language is troll.

Ifts · 18 March 2018 at 10:34PM

inflationbuster wrote: »

Wonder how long it took them to get to £1 million?
A few decades?
What's the split in subscriptions and trading gains?

Some info in this article, including Lord Lee's portfolio and how he did it:

http://www.moneyobserver.com/our-analysis/beginner-s-guide-how-to-become-isa-millionaire

inflationbuster · 19 March 2018 at 12:48AM

Nice, he took a higher risk approach using AIM stocks, l only choose from FTSE100/FTSE250it's been kinda safe and boring to date in the ISA but higher risk outside it.

I hope he spends some if it at his age.

bowlhead99 · 19 March 2018 at 12:40PM

inflationbuster wrote: »

Nice, he took a higher risk approach using AIM stocks, l only choose from FTSE100/FTSE250it's been kinda safe and boring to date in the ISA but higher risk outside it.

I hope he spends some if it at his age.

He didn't use AIM stocks to make his million in the ISA, because the ISAs (and previously, PEPs) in which he invested prior to declaring himself an ISA millionaire in 2003 did not allow investment in AIM stocks. They only became allowable investments almost a decade later in summer 2013.

Five of the shares in the extract from his recent portfolio were AIM shares but the majority were not and none of them would have been bought as AIM shares before he became an ISA millionaire in 2003 or earlier - as it wasn't allowed. If an investee moved to AIM you had to sell it out of your ISA.

But yes the high risk approach would have been the way he made the returns even if restricting himself to the main market (and you couldn't invest in single companies, only funds, until the early 90s).

Wouldn't have been a bad time to start in mid 1987 though, if you were participating in a race for nominal gains - average inflation from mid 87 to 88 was about 7-8%, mortgage rates at 10%, average UK house price up from £40k to £49k from 1987 to 1988. If you were relatively unscathed by Black Friday and able to afford to max your allowances in the years that followed, investing in small UK and European companies would have served you well. Especially combined with a little insider knowledge on government activity and policy, being an MP.

AlanP_2 · 19 March 2018 at 1:46PM

capital0ne wrote: »

There are more than 250 ISA millionaires now and it's easy to do this yourself.
Sadly professional advisors and 'experts' deride the DIY approach and try to sell their complex investment scheme to the unaware public.

Now that simple and cost effective deelers are easily availble it has never been easier to become an ISA millionaire and if you follow these simple rules you can disregard the professionals and do it yourself. Doubtless there are many millionaires on this forum so I'm sure they'll agree with the following.

1. Reinvest dividends
“This is where investors make the majority of their returns. So unless you need to take the income, reinvest the dividends.”

AGREE

2. Buy and hold
“Those who apply common sense and patience will reap the rewards over the long term.”

AGREE with some caveats

3. Avoid businesses with debt
“Businesses with rising levels of debt aren’t reliable dividend payers. Instead, seek companies with lots of cash.”

DISAGREE - How many companies can you name that do not have debt? Leaves you a very small pond to fish in.

4. Avoid funds
“There are no guarantees that someone you pay to buy shares on your behalf will get it right. To avoid disappointment make your own investment decisions and learn from your mistakes.”

TOTALLY DISAGREE on behalf of most inexperienced investors

5. Don’t worry about the FTSE 100’s ups and downs
“Those who play the long game and reinvest dividends should be less concerned about trying to find the best time to enter the market.”

AGREE - You should only have a small proportion of your investments linked to the FTSE 100 if you are following a sensible, diversified approach.

Now you know - just do it! :beer:

My comments on agreement / disagreement inline above.

bowlhead99 · 19 March 2018 at 2:09PM

6. Avoid listening to online trolls who tell you "it's best to avoid diversified investment funds, instead focus your money into self-selected, self-researched individual companies, it's easy to do this yourself".

If there are "more than 250 ISA millionaires now" (who likely used individual stocks as part of getting there), what does that tell you about the relative ease or difficulty of that status when tens of millions of people have had ISA or predecessor products, while only "more than 250"made it

Still, now a couple are able to squirrel away £40k a year (comfortably in excess of median household income) into these tax exempt products, and the products are relatively cheaper in terms of costs of access and easier in terms of information access, it's true that must be easier these days to become an ISA millionaire in nominal terms. Assuming of course that the returns over the next three decades are as good as the returns over the last three, which may or may not turn out to be the case.

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