Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • C J
    • By C J 17th May 17, 12:29 PM
    • 901Posts
    • 4,831Thanks
    C J
    What should a complete investment novice do?
    • #1
    • 17th May 17, 12:29 PM
    What should a complete investment novice do? 17th May 17 at 12:29 PM
    Dear wise people

    I'm a long time lurker on this thread, but am still baffled (and slightly terrified!) by much of the terminology - I have zero experience with investments, and would welcome some easy-to-understand advice from you.

    I have two current account regular saver accounts which mature at the end of June, which will give me around £7,000. I would like to invest this in a S&S ISA, as a way of dipping my toes into the stock market and assumed that the safest and easiest way to do this would be to open an HSBC World Selection ISA as they are my main bank.

    However not many of you seem to talk about having a S&S ISA through a high street bank as they are too expensive or don't perform as well. Would I be being ridiculously naive to go down this route? Is there a better option for me? I know £7K is a tiny amount, but I'm pleased to have managed to save this over the past 12 months and would like to put it somewhere where it can continue to work for me.

    I've already filled up the high (ha!) interest accounts from the likes of Tesco, Club Lloyds, Nationwide, TSB and get the Halifax and Coop Rewards so there's no space for the money there.

    What would you suggest, please?
    An ever-shifting labyrinth of chiaroscuro
Page 1
    • droopsnoot
    • By droopsnoot 17th May 17, 12:36 PM
    • 1,022 Posts
    • 644 Thanks
    droopsnoot
    • #2
    • 17th May 17, 12:36 PM
    • #2
    • 17th May 17, 12:36 PM
    I don't know HSBC, but I opened my S&S ISA many years ago at the Nationwide. The problem I have run into is that the selection of funds available there is very limited, so virtually none of the funds that people talk about on here or elsewhere are available.


    As well as the costs, this is something worth considering. £7 may be a "tiny amount" compared to some, but there's an argument that the costs would therefore be of more significance to you, rather than less.
    • keyboardworrier
    • By keyboardworrier 17th May 17, 12:38 PM
    • 31 Posts
    • 32 Thanks
    keyboardworrier
    • #3
    • 17th May 17, 12:38 PM
    • #3
    • 17th May 17, 12:38 PM
    My advice would be to go for the cheapest platform and appropriate fund possible, there's no point paying extra just to stick with a brand you're familiar with IMO
    • xylophone
    • By xylophone 17th May 17, 12:41 PM
    • 21,654 Posts
    • 12,452 Thanks
    xylophone
    • #4
    • 17th May 17, 12:41 PM
    • #4
    • 17th May 17, 12:41 PM
    http://www.moneywise.co.uk/investment-platforms

    might be worth a read.

    http://monevator.com/category/investing/passive-investing-investing/
    • Eco Miser
    • By Eco Miser 17th May 17, 12:58 PM
    • 2,843 Posts
    • 2,636 Thanks
    Eco Miser
    • #5
    • 17th May 17, 12:58 PM
    • #5
    • 17th May 17, 12:58 PM
    http://monevator.com/compare-uk-cheapest-online-brokers/ also lets you compare brokers.

    Incidentally, the moneywise link xylophone gave has wrong information about Iweb in its comparison table at £45 per year with 4 transactions (it's actually £20 after the first year, and nothing after the first year excluding transactions)
    Eco Miser
    Saving money for well over half a century
    • C J
    • By C J 17th May 17, 1:06 PM
    • 901 Posts
    • 4,831 Thanks
    C J
    • #6
    • 17th May 17, 1:06 PM
    • #6
    • 17th May 17, 1:06 PM
    Thank you, I'll have a read through all that tonight.

    How do the fees work, then? Do they deduct their percentage or flat fees from my investment at the start, or from any increase I've earned (each month? at the end of the year?). If I set up a standing order for a set amount to be invested each month, will I be charged a transaction fee for every deposit?
    An ever-shifting labyrinth of chiaroscuro
    • enthusiasticsaver
    • By enthusiasticsaver 17th May 17, 1:07 PM
    • 3,558 Posts
    • 6,217 Thanks
    enthusiasticsaver
    • #7
    • 17th May 17, 1:07 PM
    • #7
    • 17th May 17, 1:07 PM
    I would not use a high street bank. Generally they are pretty expensive and under perform and have a very limited choice of funds.

    Diy investors have to choose an appropriate platform to invest from and then decide which type of assets to invest in. Which one you go for depends on how much you are investing and whether you prefer percentage based one to flat fee. I use Halifax Sharedealing.

    A few golden rules of investing I follow but I am no expert as I only started 3 years ago.

    We never invest anything we think we may need in the next 5-10 years.

    We keep a large cash buffer so we are not forced to take money out of our portfolios if we need to buy a new car, holiday etc.

    We diversify across geographical areas, sectors and types of assets. The more diversified your portfolio the less risk of you losing anything.

    We invest in the Vanguard Lifestrategy funds which are popular on here and one of the most popular funds sold in the UK. You can choose different levels of risk according to the ratio of fixed investments to equities and they are funds of funds so very well diversified. Low charges too and most platforms sell them.


    The more you read about them the more confident you will get. You can either put your £7k in as a lump sum or drip feed money in monthly.
    Debt and mortgage free and saving for early retirement
    • Eco Miser
    • By Eco Miser 17th May 17, 1:21 PM
    • 2,843 Posts
    • 2,636 Thanks
    Eco Miser
    • #8
    • 17th May 17, 1:21 PM
    • #8
    • 17th May 17, 1:21 PM
    I would not use a high street bank.
    I use Halifax Sharedealing.
    Originally posted by enthusiasticsaver
    Which is an online broking arm of a high street bank - Lloyds Banking Group.

    It's a good choice, although I prefer Iweb - another trading name of the same company, with different fees.

    But don't go in branch and expect to get the same inexpensive service.
    Eco Miser
    Saving money for well over half a century
    • bostonerimus
    • By bostonerimus 17th May 17, 1:31 PM
    • 352 Posts
    • 191 Thanks
    bostonerimus
    • #9
    • 17th May 17, 1:31 PM
    • #9
    • 17th May 17, 1:31 PM
    Here's what I do

    1) Spend less than you make (ie Mr Mcawber had it right) and do a detailed budget to track spending
    2) Save 6 months spending to an emergency cash account
    3) Max out your workplace pension, LISA, SIPP etc
    4) Buy low cost diversified investment funds like Vanguard LifeStrategy or an asset allocation with index funds and rebalance
    5) Avoid individual shares and actively managed funds, they are expensive and often risky.
    6) Avoid high interest debt, pay off the credit card in full each month
    7) Try to save 20% of your gross salary, hard I know but start with something and work your way up
    8) Maximize ISA then go onto regular investing accounts...still only using low cost index funds
    9) Be cynical about advice and educate yourself, read the bogleheads.org wiki
    10) Don't fret about performance.
    Last edited by bostonerimus; 17-05-2017 at 5:11 PM.
    • StellaN
    • By StellaN 17th May 17, 2:00 PM
    • 139 Posts
    • 38 Thanks
    StellaN
    HSBC do have some decent funds though both passive and active.

    As well as the HSBC World Section they also have the HSBC Global Strategy funds (3 risk levels) and these are low cost multi asset funds similar to VLS and L&G funds but lower in UK allocation.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

175Posts Today

1,423Users online

Martin's Twitter