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  • FIRST POST
    • MSE Amy
    • By MSE Amy 15th Apr 14, 6:25 PM
    • 27Posts
    • 36Thanks
    MSE Amy
    Stocks & Shares ISAs
    • #1
    • 15th Apr 14, 6:25 PM
    Stocks & Shares ISAs 15th Apr 14 at 6:25 PM
    Hi!

    This is the discussion thread for the


    Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.
Page 20
    • dunstonh
    • By dunstonh 9th Apr 17, 11:37 AM
    • 88,823 Posts
    • 54,169 Thanks
    dunstonh
    Why do you not mention trading fees on Shares? Many investors won't have the capital that is often required as a minimum initial investment for a lot of funds, so will want to invest in ETFs.
    Originally posted by temartin123
    Surely smaller investors are better off investing in UT/OEICs rather than ETFs as a means to reduce their costs. Plus, smaller investors tend to be more inexperienced and not aware of the extra risks that ETFs can have.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • MrNick
    • By MrNick 10th Apr 17, 10:11 PM
    • 10 Posts
    • 0 Thanks
    MrNick
    Cash in of Stocks & Shares ISA
    Hi,
    I have a Stocks & Shares ISA (Homeplan) that has been running for abot 15 years (this was set up jointly with my partner so we both contribute) to assist in paying our mortgage off (Jun 2018).
    I would like to cash in about 75% of the current S&S ISA (approx. 70K) & we will continue to pay in £300 per month to it. I'm concerned about leaving all this money in the S&S ISA when so near mortgage pay off.
    I have checked and there are no fees associated with withdrawing the money. I can only pay 10% overpayment on my mortgage of approx. 100K.
    Main question is: The money I withdraw will be used to pay off majority of my mortgage Jun next year, I guess we can both put some of this remaining money into cash ISAs as long as it doesn't exceed the total allowance for each of us for the year! Any advice welcome.
    Thanks
    • masonic
    • By masonic 11th Apr 17, 6:58 AM
    • 9,126 Posts
    • 6,273 Thanks
    masonic
    Hi,
    I have a Stocks & Shares ISA (Homeplan) that has been running for abot 15 years (this was set up jointly with my partner so we both contribute) to assist in paying our mortgage off (Jun 2018).
    I would like to cash in about 75% of the current S&S ISA (approx. 70K) & we will continue to pay in £300 per month to it. I'm concerned about leaving all this money in the S&S ISA when so near mortgage pay off.
    I have checked and there are no fees associated with withdrawing the money. I can only pay 10% overpayment on my mortgage of approx. 100K.
    Main question is: The money I withdraw will be used to pay off majority of my mortgage Jun next year, I guess we can both put some of this remaining money into cash ISAs as long as it doesn't exceed the total allowance for each of us for the year! Any advice welcome.
    Thanks
    Originally posted by MrNick
    I would definitely consider cashing in now given how soon the money is needed.

    The interest generated by £70k is unlikely to exceed a couple's personal savings allowance (if basic rate taxpayers), so using a cash ISA might not be the best option if you can find a better non-ISA rate. If you do wish to use a cash ISA, you may be able to do a partial transfer through your ISA provider, assuming your S&S ISA permits this. That way you'd not be limited to your allowance.
    • pharmice
    • By pharmice 11th Apr 17, 2:09 PM
    • 17 Posts
    • 8 Thanks
    pharmice
    I'm in my mid 30's, and I own my home via a mortgage on ~2.2% apr. My mortgage balance is currently only £25,000.

    I have just invested my full £20,000 isa allowance on a monthly income fund that apparently pays 0.5p/share/month. I invested using the HL platform, and they told me to expect about £102 income per month paid into my bank account.

    It sounds too good to be true. If I knew such funds existed, I would have started investing 2-3 years ago when I was very liquid. I'm hoping to keep investing in the fund using other non-isa accounts until I'm able to achieve an income of £1000/month from it, not bad to look forward to in retirement, aye?!
    • peter_333
    • By peter_333 11th Apr 17, 3:21 PM
    • 34 Posts
    • 8 Thanks
    peter_333
    I'm in my mid 30's, and I own my home via a mortgage on ~2.2% apr. My mortgage balance is currently only £25,000.

    I have just invested my full £20,000 isa allowance on a monthly income fund that apparently pays 0.5p/share/month. I invested using the HL platform, and they told me to expect about £102 income per month paid into my bank account.

    It sounds too good to be true. If I knew such funds existed, I would have started investing 2-3 years ago when I was very liquid. I'm hoping to keep investing in the fund using other non-isa accounts until I'm able to achieve an income of £1000/month from it, not bad to look forward to in retirement, aye?!
    Originally posted by pharmice
    What's the fund?
    • masonic
    • By masonic 11th Apr 17, 5:53 PM
    • 9,126 Posts
    • 6,273 Thanks
    masonic
    I have just invested my full £20,000 isa allowance on a monthly income fund that apparently pays 0.5p/share/month. I invested using the HL platform, and they told me to expect about £102 income per month paid into my bank account.

    It sounds too good to be true. If I knew such funds existed, I would have started investing 2-3 years ago when I was very liquid. I'm hoping to keep investing in the fund using other non-isa accounts until I'm able to achieve an income of £1000/month from it, not bad to look forward to in retirement, aye?!
    Originally posted by pharmice
    It doesn't sound so unreasonable. It is a 6% yield, which is within the scope of a high income fund. Of course, the income could go down in the future, as could the capital value of your investment.

    As an aside, I hold investments where I receive 1% per month, but again these are not without capital risks.
    • jimjames
    • By jimjames 11th Apr 17, 8:48 PM
    • 11,944 Posts
    • 10,348 Thanks
    jimjames
    It sounds too good to be true. If I knew such funds existed, I would have started investing 2-3 years ago when I was very liquid. I'm hoping to keep investing in the fund using other non-isa accounts until I'm able to achieve an income of £1000/month from it, not bad to look forward to in retirement, aye?!
    Originally posted by pharmice
    When you're in your 30s surely growth is more important than income?
    Remember the saying: if it looks too good to be true it almost certainly is.
    • Brand
    • By Brand 16th May 17, 8:13 AM
    • 76 Posts
    • 21 Thanks
    Brand
    Vanguard Fund platform
    A few people have stated as absolute that the only way to invest in funds is via a platform. That it is not possible to invest via the fund manager directly.
    This is not true.
    For many years I've invested into index trackers with Legal and general directly. I have only gone with platforms for active managed funds as the platform reduced the initial and annual management fees and hence it was cheaper to invest via the platform.
    From my reading of the fees, it is better for people to invest in two of the funds listed (The L&G UK Index and the L&G US Index) directly with L&G themselves. It certainly was in comparison with investing via H&L as H&L gave no reduction in the AMCs (there are no initial fees) and added their own platform fee on top.
    So am I right in that in this case (L&G) the charges are lower going directly? In which case why would anyone use a platform for these funds?
    Originally posted by hwindsor
    Vanguard have a cheap platform to invest directly on a % basis.
    https://www.vanguardinvestor.co.uk/ https://www.vanguardinvestor.co.uk/what-we-offer/fees
    https://www.theguardian.com/business/2017/may/16/vanguard-funds-investment-isa-uk-fees-hargreaves-lansdown-fidelity
    It was mentioned on BBC WakeuptoMoney this morning http://www.bbc.co.uk/programmes/b08q458t
    A market commentator (from top US investors PIMCO) also gave thoughts on why the FTSE is still rising.
    (For what it is worth, I have posted my contrasting opinion that there is a time for putting a lump sum into an index ETF or index tracker, but that time is not now http://forums.moneysavingexpert.com/showpost.php?p=72553346&postcount=46
    Last edited by Brand; 16-05-2017 at 8:28 AM. Reason: add Guardian link
    • bowlhead99
    • By bowlhead99 16th May 17, 9:32 AM
    • 6,606 Posts
    • 11,689 Thanks
    bowlhead99
    Thanks for highlighting that, Brand - Vanguard previously only had a 'direct to customer' offering for investors with minimum £100k and didn't offer any ISA wrappers.

    Their new offering to handle a more 'mainstream retail' level of investing and with an ISA available only launched this week, thus the publicity you linked.

    0.15% is very competitive compared to all the other percentage-based platforms and would be great if you are just looking to hold a single lifestrategy-type product. Other people might not begrudge paying a different platform 0.25% instead if it means they can hold funds from multiple providers and easily rebalance between them in a 'fund supermarket' type manner.
    • stips
    • By stips 16th May 17, 12:23 PM
    • 1 Posts
    • 0 Thanks
    stips
    Just wanted to post something regarding Cavendish, as it seems there may or may not be a hidden charge there not mentioned in the article.

    Both the article and Cavendish state 0.25% in fees, being a humble peasant with only 1K to invest low cost is important so I went to Caven.

    Upon opening the article it appears there is an annual 45 GBP "investor fee" that has apparently been in place for a few years now, this was not mentioned in the article(despite it being "updated April 2017") or on Cavendishs main site.

    Confusingly a document said the 45 GBP fee is waived for Cavendish, but the Cavendish account page says it will be charged, hence why I am mentioning it here.
    Last edited by stips; 16-05-2017 at 1:49 PM.
    • Puddylove
    • By Puddylove 17th May 17, 9:43 AM
    • 410 Posts
    • 657 Thanks
    Puddylove
    Hi
    Forgive my ignorance regarding S&S ISAs...
    Is it worthwhile putting a small amount (£50 or £100 per month into a Halifax S&S ISA towards my retirement? Or is this too little to be worth doing?
    Other info - I have a HTB ISA, pension which I pay extra into, and savings for the short term.
    I understand I could lose every penny - but won't bother if the charges are large in proportion to the tiny amount I can save at the moment.
    Advice welcomed.
    • Redski69
    • By Redski69 17th May 17, 10:46 AM
    • 22 Posts
    • 12 Thanks
    Redski69
    Just wanted to post something regarding Cavendish, as it seems there may or may not be a hidden charge there not mentioned in the article.

    Both the article and Cavendish state 0.25% in fees, being a humble peasant with only 1K to invest low cost is important so I went to Caven.

    Upon opening the article it appears there is an annual 45 GBP "investor fee" that has apparently been in place for a few years now, this was not mentioned in the article(despite it being "updated April 2017") or on Cavendishs main site.

    Confusingly a document said the 45 GBP fee is waived for Cavendish, but the Cavendish account page says it will be charged, hence why I am mentioning it here.
    Originally posted by stips
    Being with Cavendish, you won't pay the £45GBP Investor Fee. That is a mistake in the text I'd wager.
    • Redski69
    • By Redski69 17th May 17, 10:51 AM
    • 22 Posts
    • 12 Thanks
    Redski69
    Hi
    Forgive my ignorance regarding S&S ISAs...
    Is it worthwhile putting a small amount (£50 or £100 per month into a Halifax S&S ISA towards my retirement? Or is this too little to be worth doing?
    Other info - I have a HTB ISA, pension which I pay extra into, and savings for the short term.
    I understand I could lose every penny - but won't bother if the charges are large in proportion to the tiny amount I can save at the moment.
    Advice welcomed.
    Originally posted by Puddylove
    I think it depends on your age & the type of lifestyle you want at Retirement ...

    For example, a basic example with a crude calculation ... if I want to retire at 65 and I live to 85-ish that's 20 years of retirement.

    If I'm enjoying a lifestyle now on an £80K salary ... that's a Pension Pot of £1.6M.


    Given there's variables like you won't be paying a mortgage anymore etc etc - but you get the idea.

    Take that £1.6M figure, divide it by the number of years you are away from 65 to get your annual savings figure to achieve a decent Pension Pot, then divide that by for a Rough Guide as to how much you should be saving per month to keep you in the lifestyle you're accustomed to !

    Hope it helps ...
    • eskbanker
    • By eskbanker 17th May 17, 11:22 AM
    • 5,318 Posts
    • 5,069 Thanks
    eskbanker
    Although the £1.6m figure above is purely illustrative, anyone looking to accumulate a 7-figure pension pot needs to be aware of the tax implications of exceeding the £1m lifetime allowance....

    To the poster asking about S&S ISAs for retirement, if you're under 40, consider a Lifetime ISA to benefit from the 25% government bonus as well as investment growth.
    • bowlhead99
    • By bowlhead99 17th May 17, 11:24 AM
    • 6,606 Posts
    • 11,689 Thanks
    bowlhead99

    Take that £1.6M figure, divide it by the number of years you are away from 65 to get your annual savings figure to achieve a decent Pension Pot, then divide that by for a Rough Guide as to how much you should be saving per month to keep you in the lifestyle you're accustomed to !

    Hope it helps ...
    Originally posted by Redski69
    I doubt it helps. The idea that to be able to spend £80k a year for 20 years you need to put away £80k a year for 20 year is complete bollards. It presumes zero investment growth over the four decades.

    The whole point of investing (in S&S ISAs or pensions or other tax efficient vehicles) for retirement is to get investment growth to increase your wealth in real terms beyond the amount you are able to throw into a piggy bank from your ongoing salary.

    If you think that is going to totally fail and leave you with zero or negative investment growth in real terms over forty years or more, then, sure thing: prepare for the worst outcome and divide your total spending needs in retirement by how many years you have left until retirement, and save that amount in an account or investment which only returns an amount close to inflation. But that's not how most people do it.
    • Puddylove
    • By Puddylove 17th May 17, 11:42 AM
    • 410 Posts
    • 657 Thanks
    Puddylove
    Thanks for your thoughts...I'm over 40, and about 15 to 20 years away from retiring. No LISA for me.

    So it's not a good idea to save in an ISA unless I can put more in?
    • eskbanker
    • By eskbanker 17th May 17, 1:08 PM
    • 5,318 Posts
    • 5,069 Thanks
    eskbanker
    Thanks for your thoughts...I'm over 40, and about 15 to 20 years away from retiring. No LISA for me.

    So it's not a good idea to save in an ISA unless I can put more in?
    Originally posted by Puddylove
    OK, I wrongly assumed from your reference to HTB that you were younger (you look it! )

    If you're planning to buy a property, with all the costs that that entails, then you may find it a better use of your surplus monthly £50-100 to save in a regular saver account in preparation for buying a home, but to answer your question, you can put it in a S&S ISA for the long term instead. In terms of charges, you'll want a low-cost platform that doesn't charge for regular transactions, see http://monevator.com/compare-uk-cheapest-online-brokers/ for a comparison of costs....
    • jimjames
    • By jimjames 17th May 17, 1:33 PM
    • 11,944 Posts
    • 10,348 Thanks
    jimjames
    So it's not a good idea to save in an ISA unless I can put more in?
    Originally posted by Puddylove
    No that's not the case. I'd say it is a good idea to start as early as you can and put in what you can afford. The more you invest and the longer it has to grow the better. The main thing is that you start and get into the habit.


    Just make sure you use a platform that doesn't have fixed fees but charges a percentage so it's not excessive.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • Salamat
    • By Salamat 15th Jul 17, 1:57 AM
    • 3 Posts
    • 0 Thanks
    Salamat
    Dividend withdrawals
    "However, dividend income received on shares held in a stocks & shares ISA will be tax-free. (Older investors may remember when there was a 10% tax deducted from dividends at source which couldn't be reclaimed, which meant a stocks & shares ISA wasn't quite tax-free - this was abolished in April 2016.)"

    Is it possible to clarify withdrawing dividend income from a 'S&S ISA', as I'm not sure how critical that 'held in' wording is! I understand that dividend payments are tax-free while being accumulated in the ISA, but are they when you try and withdraw them?

    If you are just withdrawing the income from dividends in a 'S&S ISA', will they be regarded as 'income' and therefore be taxable if you have already exceeded the basic £11,000 allowance, or can they be offset against the £5,000 dividend allowance? (I believe I'm right in thinking it's only the 'Cash ISA' that can be totally ignored for tax purposes?)

    (I have been trying to make the comparison with withdrawing income from dividends accumulated in a 'SIPP', where they will always be regarded as 'income' and will be liable to tax, if you are already over your £11,000 allowance!)

    Would be very grateful if this can be clarified for me.
    • le loup
    • By le loup 15th Jul 17, 9:47 AM
    • 3,555 Posts
    • 3,367 Thanks
    le loup
    Income from ISAs whether retained in the ISA or withdrawn is tax free as are capital gains.
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