ISA Advice

micksom

Hi,

I am looking for some advice regarding my ISA.

I currently have a cash ISA with HBOS with a value of £7000. The ISA is a standard cash ISA with a rate of 5%, and I have deposited the maximum £3600 this year.

However, I would like to know more about the stocks and shares ISA. Is the stocks and shares buying stocks in shares in HBOS or is it buying stocks and shares in other companies which HBOS choose for you?

Is it possible to transfer my cash ISA to a stocks and shares ISA and directly buy shares in HBOS?

I am kind of clueless...

aqueoushumour01

if you're clueless dont buy stocks in HBOS - have you seen how volatile that stock is? I'd leave that one to the experts (some of whom by the way have lost a lot on that stock)

I don't know about the HBOS product but it probably either tracks an index (e.g. FTSE 100) or allows you to pick and choose shares. You'll have to take short term volatility (I funded a stocks and shares ISA this week, and as I type I'm about 16% down in total) but it's a long term investment - if you need the money soonish then it's not the right thing for you.

I wouldn't personally invest in a stock picking stocks and shares ISA as I'm not going to pretend that I know how to pick the right stocks - so only do that if you're willing to lose the money for making the wrong choices.

Lokolo

It depends who you take the Stocks and Shares ISA out with. You can take it out with fund supermarkets such as Hargreaves Lansdowne. Or of course, you can with a bank.

Only problem with banks is their limited range and knowledge (most of the staff anyway) so you won't be able to get the full package.

A few things to consider if you are thinking of investing-

• Its longterm - 5-10 years minimum.
• You may not get back what you put in i.e. you put in £3600 now, in 10 years you may only get £1000, or maybe nothing!
• There are usually charges, usually a few %, annually as well as initial when investing, banks are usually higher I think.

If you are now thinking, oh, I don't think this would be good, forget it, carry on saving.

However if you are still thinking about it, then say

Thrifty-saver

I agree with Aqueoushumour 01 reply to your prob.If you're not sure, stick with a good cash ISA. Especially as the Stock market is so volatile now. I've got mine in a Fixed Rate for 1year currently paying 6.15% (better than what you're getting, but REMEMBER it's tied up for a year) with Nationwide. Have renewed this for another year but unfortunately then took this years allowance out with Ice-save (boo-hoo). My husband is even more pig sick than me as he transferred his Nationwide one to Icesave and has therefore loads of money he can't get at & isn't earning any interest
whatsoever. Hope this reply helps

Rikki

Can you cancel an Isa the next day if you have opened it and realised you've made a mistake in the type you have chosen?

Baldur

Rikki wrote: »

Can you cancel an Isa the next day if you have opened it and realised you've made a mistake in the type you have chosen?

See http://www.hmrc.gov.uk/ISA/isa-guidance-notes-2008.pdf

Cancellation
5.5 Subject to paragraph 5.7, ISA managers may, in their terms and conditions, allow investors the right to cancel their cash subscription to an ISA, or packaged product within an ISA, within a set period after the receipt by the investor of the notice of the right to cancel. Provided that this period – the cancellation period - does not exceed 30 days (after the notice has been received), investors who cancel their subscription within the cancellation period are exempt from UK income and capital gains tax on any income or gains arising from the subscription in the period.

Strictly investors who withdraw their subscriptions from an ISA by exercising their
right to cancel have made a subscription to an ISA. But where the subscription is
cancelled within the set period, investors will be treated as though they have not
subscribed to an ISA.

aqueoushumour01

Rikki wrote: »

Can you cancel an Isa the next day if you have opened it and realised you've made a mistake in the type you have chosen?

if you've made a loss on your investment in that time, you'll only be able to take out how much it's worth and not what you put in.