Got close to £10K. Never invested before, options please?

jackhulk

I fully understand this, nothing wrong with playing safe, I'd just rather take an educated chance for possible higher gains.

Lokolo wrote: »

For my investment I want to make in the future I need a minimum of £80,000 cash.

What do you mean?

Aegis

DiggerUK wrote: »

@ Jackhulk,
You have been correctly advised that I am an IFA basher.

If you look at the history of these people you will find that they have a track record of being involved in miss selling of endowments for houses, and pensions in the past.
Changes of course have been made to "ensure that the lessons have been learned and will not happen again." How often do we hear that one!

These people are of course regulated by the F.S.A., the same people who are also regulators for the banks. Still not wary about them?

They give the impression that they have insight into the financial world. They don't, they are not trained or even required to do in depth analysis. Still not wary about them?

How about this then. They are not even required to have a GCSE in maths to qualify as an IFA.

My advise to you was based on what I would do in your place.

Good luck.

How about this then. They are not even required to have a GCSE in maths to qualify as an IFA.

No, however most people are advised here to seek out someone with the diploma of financial planning as a minimum qualification, which is the equivalent of a single-year university qualification. Far higher than GCSE maths.

The existing minimum for IFAs is CeFA or the CertFP, both of which are much more useful to the role than GCSE maths. This requirement is increasing from 2012 in line with the RDR to make sure that IFAs have at least a level 4 qualification such as the Diploma of Financial Planning. Strikes me as a fairly good idea, but academic qualifications don't necessarily make a decent adviser, they just help to demonstrate what someone knows.

I wasn't around for the endowment situation, but it seemed to me to be largely based around over-inflated estimates from the endowment providers as to what the bonuses would be, coupled with a desire from consumers to pay far less than the cost of a full endowment, which would have been guaranteed to pay off the full cost of their mortgage. Yes, the advisers probably should have made the consumers explicitly aware of the fact that these products were not guaranteed to pay off the amount in full, but it seems less than fair to place the blame for this solely with IFAs when there are a whole host of other people who need to be held responsible at the same time.

In any case, this is unlikely to be an issue any more because endowments aren't sold any more, so why keep bearing a grudge against the entire profession?

Lokolo

jackhulk wrote: »

What do you mean?

You are self employed. I want to become self employed and the business I want to have requires £80,000 to open.

JoeCrystal

@jackhulk Fair enough! :cool: Still, it take an impressive mind to shrug off major loss of the sum of ten thousand pounds. If I lose that amount, I would be crying and bitterly regretting the path that led me to losing it.

@Lokolo I am sure you will reach that target (but have you take into account of inflation. What is eighty thousand pounds now may be higher years onward)! I got personal aim for enough saving to ensure myself a living without working. :A Which is going to take me decades. That is why I am eyeing potential decade long investments while I am still young!

Cheers

Joseph

Aegis

jackhulk wrote: »

OMG! Typical ISA, 3.5%! £126 interest over a YEAR?!?! Or am I completely getting my figures wrong here??

That to me seems an insult. Now I know why I've never been a saver!!

Rates are historically low at the moment. Over the next few years I wouldn't be surprised to see cash ISA rates improve, but cash is never going to be a place for you to increase your net worth in the long run. Cash tends to grow more or less with inflation on average, meaning your real return comes out at around nothing if you look at pure spending power.

There are some accounts which can effectively grow your money ahead of inflation, but you often have to manage your money pretty intensively to make these options work for you.

That said, cash IS secure, and if you need the money for a definite event of any sort it's always best to ensure that you move into cash while you still have enough for whatever you want to spend it on. No sense in investing in volatile assets for six months, for example.

StuartGMC

HMRC rules allow up to £3600 in a Cash ISA and the balance to £7200 in a Stocks & Shares ISA per person per year. So if you are quick, you can drop £3600 in a Cash ISA then drop £3600 in a Stocks & Shares ISA (choosing where to invest it later, e.g. gradually to gain pound averaging - some providers have a "parking facility" for this purpose) by end of day Friday.

Note: online supermarkets for the S&S ISAs can be a little confusing in their terminology; I use iii (interactive investor but they aren't usually the "recommended" one here on MSE, I think Hargreaves Lansdowne is? ) as we make monthly contributions across 6 funds which can be as low as £20 each in some funds. iii have a "Funds ISA" which allows investments in OEICs and Unit Trusts only. If you want to invest in individual equities, ETFs plus Funds etc then you have to opt for their "Self Select ISA" which confusingly they cite thus even though both come under HMRC S&S ISA rules:

Self-Select ISA
With a Self-Select ISA (also known as a Shares ISA or a Stocks and Shares ISA) you can invest up to £7,200 in your own choice of shares and/or funds.

The charges are different for each product so you need to consider how often you will be purchasing and selling equities if opting for these, and indeed the best provider for your needs. Note AIM is not allowed in ISAs.

Overall, I assume you already have your pension covered each month, on track or already mortgage-free and hold emergency savings of 3-6-9months outgoings, and if you are serious about OEICs, UT and equities, then you are looking at several years to gain return (e.g 5-10)?

If you haven't really read through the options, then I would recommend you drop money into the Cash ISA by Friday, but read around the different providers' offerings for the S&S ISA varients. Then you can choose in the next month or so and start in the FY2009-2010.
Remember, Act in haste and repent at leisure....

HTH?

PS: once mortgage free in October (hopefully) we'll be upping Cash ISA and S&S ISA contributions to maximum, and we'll look to spread the monthly investments over a few more funds. I need some exposure to Europe and probably "ought" to get a FTSE tracker amongst the 7 we are running with now - our Neptune Russia & Greater Russian is not getting new money from us since Jan, as it is languishing at 44% loss (improvement over worse position in Dec/Jan) but also no point in crystallizing losses either by cashing in. I'm looking at a 15yr horizon basically to get me to 60yrs old, so plenty of time for growth and another recession??

jackhulk

Head hurts! Decided to put £3200 in to cash isa tomorrow (natwest - already a customer - 3.5%). Even though 3.5% really doesn't excite me, at least its more than what my money is earning at present.

Would like to invest the rest in stock and shares ISA, however, been looking at a few fund supermarket and they all very confusing for this newbie. The only one I've come close to understanding is this one.................well there should be a link here but I can't post links as a newbie to this forum?!

Anyway, the ISA on offer is INVESCO PERPETUAL Corporate Bond Inc = 5%

How 'safe' are S&S ISA's? IE, is it just the interest thats not gauranteed, or the actual investment as a whole??

Lokolo

Why only £3,200? £3,600 is the limit.

With S&Ss, most of the time, nothing is gaurenteed (i.e. your capital can reduce)

JoeCrystal

S&S ISA? You can lose your entire capital on nasty stock/fund markets. It is like gambling.

jackhulk

Soz, meant £3600.

So how do I go about choosing the right S&S ISA??? IFA?