Stocks and Shares ISAs

Sol00

Hi,

Tried looking for info on this, but can't find anything.

How do these work?

Aegis

Sol00 wrote: »

Hi,

Tried looking for info on this, but can't find anything.

How do these work?

You put money up to your allowance into a stocks and shares ISA, then purchase assets inside it. Those assets then grow very tax efficiently.

That's it, in a nutshell.

driver85

Aegis wrote: »

You put money up to your allowance into a stocks and shares ISA, then purchase assets inside it. Those assets then grow very tax efficiently.

That's it, in a nutshell.

Probably best to point out that they dont always grow!! If you're looking for a guaranteed return on investment then a Guaranteed Equity Bond may be right for you. Most of the big banks and building societies have info on their websites.

jem16

driver85 wrote: »

If you're looking for a guaranteed return on investment then a Guaranteed Equity Bond may be right for you.

Certainly correct. If you are looking for a guaranteed return of 0% a GEB is definitely the way to go.

dunstonh

Most of the big banks and building societies have info on their websites.

Although their terms are rarely any good and whole of market options usually come in better. Although once you realise the costs of the guarantee, its often enough to put you off.

Sol00

Aegis wrote: »

You put money up to your allowance into a stocks and shares ISA, then purchase assets inside it. Those assets then grow very tax efficiently.

That's it, in a nutshell.

Sorry if this sounds dumb, I'm still not 100% about stocks and shares, but if the limit is £7500 (I think), this means I could put so much of the cash allowance in and the remainder would be anything I purchase of the stockmarket, up to the limit? That doesn't sound too bad.

allan673

have you used all of your cash isa allowance first? £3600 this tax year.

if you have then i would put the remainder of your savings in fixed rate high interest deposit bonds.
http://www.hsbc.co.uk/1/2/personal/savings/hidb;jsessionid=0000JzrbJWWPjcSnQnHc8-snKyf:11j74lc1v
something like this - look around for a good rate of interest.

too much of a gamble at the moment to put your cash into a stocks and shares isa, as you could lose money!!!
isa limit is £7200 per year, but thats £3600 in a cash isa, and £3600 in a stocks and shares isa.

dunstonh

too much of a gamble at the moment to put your cash into a stocks and shares isa, as you could lose money!!!

You can always lose money on a S&S ISA. As for it being a gamble, that would depend on what you put in the ISA. However, assuming your are making the assumption it is equities only being looked at, its probably far less of a risk to invest in equities now then it was at any point in the growth years from 2004-2006.

allan673

dunstonh, would you recommend putting money into a s and s isa? and if so what type please.im asking as i was told by hsbc that the bonds are a safer bet.
ive put the max allowance in my cash isa and wanted to save elsewhere.

Lokolo

Bonds are still risky but they are less risky than equities.

He isn't allowed to suggest specifics as it is against forum rules.

If you are seriously about investing then read a couple of beginner books:

http://www.amazon.co.uk/Investing-Dummies-Tony-Levene/dp/0470992808

For starters.

dunstonh

dunstonh, would you recommend putting money into a s and s isa?

Depends on the person involved, timescale and risk profile. However, I have upped my monthly contributions to my investments.

if so what type please.im asking as i was told by hsbc that the bonds are a safer bet.

Fixed interest sector (bonds) are typically lower risk but there is a scale of risk within those that can go as high as high risk. So, you have to make sure the type of fixed interest funds you buy match your risk profile.