Investment ISA & Managed Fund Investment

Brooksy6791

Hello to all.

Just some advise if someone can assist please.

I went into my local Abbey National branch yesterday to pay in a cheque. I was told by the cashier that I should really have my money doing better than it was as I only had a normal savings account with miniml interest. So I ended up having a meeting almost straight away with the savings and investments manager.

I have approximately 34K to my name. I have never invested before, only saved.

I was asked what I thought that I could spare to invest which I decided on £14,500.

I was advised to wrap up £7200 in an investment ISA which I did.
I was also advised to tie a further £7300 in a managed fund which is their international equity portfolio (classed as medium to high risk).
I was also able to take advantage of a limited promotion called the Super Bond, which offers 5% but I had to take an investment of the same value or greater with another Abbey investment product which I was doing anyway so this was ok.

My only concern now is that everyone I have spoken to say's that I should not have gone for the investment ISA and that I should have taken the cash ISA option instead. Also that I am barking mad for taking the meduim to high risk managed fund portfolio investment, given that approx 35% of the split will be with UK equities.

I was going to hold fire with any investing until after the Dubai saga and the possible ripple effects had been highlighted anywhere.

A friend of mine told me this was the place for good guidance and advise so i'm hoping that someone can tell me if i'm an idiot or not !

I am told I will have 14 days to cancel from when I receive my confirmation by post.

Many Thanks

Brooksy

Lokolo

OK a few pointers

1) Banks have the worst investments, you are limiting yourself by going to a bank.

2) 35% in UK equities aren't high risk (to the normal investor). Bare in mind high risk would be asia equities (where you have the currency risk on top). I doubt you have put anything there!

3) Cash ISAs are a no risk option. Meaning you will get limtied growth, but you will never lose capital. S&S ISA (investments), have risk element, so in 5 years you could have less than you started. However, this risk element comes with a reward element. You could end up with more than a savings account (such as Cash ISA).

Brooksy6791

Thanks for the reply Lokolo.

I really just wanted somewhere to keep my money safe with a bit of interest perhaps, but she was damn convincing with her pitch - but hey, it's her job so I have only myself to blame..

Like I said, i've never invested before and have only just starting to find out what's what and who are good reputable companies to invest with, which was partly why I was going to wait a few months before investing anything.

I'm considering excercising the 14 day get out clause already and doing a bit more research before jumping too far into the pond.

dunstonh

My only concern now is that everyone I have spoken to say's that I should not have gone for the investment ISA and that I should have taken the cash ISA option instead.

Why?

Nothing wrong with S&S ISAs and mine have made far more than my cash ISAs.

Also that I am barking mad for taking the meduim to high risk managed fund portfolio investment, given that approx 35% of the split will be with UK equities.

As lokolo says, 35% equity is not high risk. Although that is on the assumption that the other 65% is not equities.

I was going to hold fire with any investing until after the Dubai saga and the possible ripple effects had been highlighted anywhere.

Didnt really cause any ripples longer than a few days.

I was advised to wrap up £7200 in an investment ISA which I did.
I was also advised to tie a further £7300 in a managed fund which is their international equity portfolio (classed as medium to high risk).
I was also able to take advantage of a limited promotion called the Super Bond, which offers 5% but I had to take an investment of the same value or greater with another Abbey investment product which I was doing anyway so this was ok.

The concept is a good idea. The place you have done it and the products chosen are awful. The Super Bond terms are poor. The investment funds they offer are poor (although normal for the banks to be like that).

You are not an idiot. You have the right idea but you have implemented it with a low skilled, low quality provider.

Friends are not a great place to get advice unless you know their background. You may have friends that invested just before a major crash and pulled out straight after suffering a big loss rather than wait for recovery. They will usually be negative towards investments as their lack of knowledge led them to making a mistake in an area they didnt understand. Equally, someone that has only invested in the good years will usually be pro investments and may understate the risks. The workplace is often the worst place for myths about various financial matters.

investing is long term and you will get good years and bad years. Last year was a bad year. This year was a good year. The three years before that were good years. The two years before that were bad. You average out the ups and downs. If you cant handle that then you shouldnt do it or shouldnt do it with much.

You should also note that there is no such thing as a nil risk product and risk is not on/off. It is a sliding scale. With Cash ISAs, you dont have investment risk. However, you do have inflation risk and shortfall risk.

Typically, a combination of things is the best option.

Lokolo

Brooksy6791 wrote: »

Thanks for the reply Lokolo.

I really just wanted somewhere to keep my money safe with a bit of interest perhaps, but she was damn convincing with her pitch - but hey, it's her job so I have only myself to blame..

Like I said, i've never invested before and have only just starting to find out what's what and who are good reputable companies to invest with, which was partly why I was going to wait a few months before investing anything.

I'm considering excercising the 14 day get out clause already and doing a bit more research before jumping too far into the pond.

Well if you can be bothered you can make your own portfolio if you put in some time into it.

First question is, do you want to invest or just save?

Investing, because of the risk element, and as Dunston has pointed out, some years are bad, some are good, means if you want to get the best out of your return it's really a longterm thing. If you are thinking of splashing out the money on a retirement holiday (a BIG one!) in a years time, then investing isn't really the way to go.

pressuredrop_2

Brooksy6791 wrote: »

I am told I will have 14 days to cancel from when I receive my confirmation by post.

You know it makes sense.

Brooksy6791

dunstonh wrote: »

Why?

Nothing wrong with S&S ISAs and mine have made far more than my cash ISAs.
As lokolo says, 35% equity is not high risk. Although that is on the assumption that the other 65% is not equities.

Didnt really cause any ripples longer than a few days.

The concept is a good idea. The place you have done it and the products chosen are awful. The Super Bond terms are poor. The investment funds they offer are poor (although normal for the banks to be like that).

You are not an idiot. You have the right idea but you have implemented it with a low skilled, low quality provider.

Friends are not a great place to get advice unless you know their background. You may have friends that invested just before a major crash and pulled out straight after suffering a big loss rather than wait for recovery. They will usually be negative towards investments as their lack of knowledge led them to making a mistake in an area they didnt understand. Equally, someone that has only invested in the good years will usually be pro investments and may understate the risks. The workplace is often the worst place for myths about various financial matters.

investing is long term and you will get good years and bad years. Last year was a bad year. This year was a good year. The three years before that were good years. The two years before that were bad. You average out the ups and downs. If you cant handle that then you shouldnt do it or shouldnt do it with much.

You should also note that there is no such thing as a nil risk product and risk is not on/off. It is a sliding scale. With Cash ISAs, you dont have investment risk. However, you do have inflation risk and shortfall risk.

Typically, a combination of things is the best option.

Thanks for the reply dunstonh.

Yeah I understand that there will be good and bad years. I feel a bit mugged off though because I should have stood by my original plans and researched more and perhaps gone about it a different way. I'm hoping that by joining this site that I can pick up a few tips and pointers as to who to invest with etc. I've joined quite a few other forums to learn about various topics unrelated to investments and I have managed to pick them up from scratch and put the knowledge to good use so hopefully I can do the same here.

If I could just ask one question please :
The money I have put in the International Investment portfolio is advised as being managed by santander asset management uk who then select fund managers. The split = Uk equities 35%, Us equities 18%, Europe equities 15%, Japan equities 15 %, Pacific equities 10%, emerging markets 2%, other 5%. I will receive more information through the post, but should I have been given more specific details ?

Brooksy6791

Lokolo wrote: »

Well if you can be bothered you can make your own portfolio if you put in some time into it.

First question is, do you want to invest or just save?

Investing, because of the risk element, and as Dunston has pointed out, some years are bad, some are good, means if you want to get the best out of your return it's really a longterm thing. If you are thinking of splashing out the money on a retirement holiday (a BIG one!) in a years time, then investing isn't really the way to go.

Well I can definately be bothered, i'm just trying to find out the process really and who are reputable companies to go through etc. I understand that there will be some risk which I have no problem about. I'd prefer to invest a smaller amount ideally, something I could do myself then see how that goes. The main reason why I was comfortable(ish) through the bank was that I know they are a genuine company rather than some outfit who I don't really know of.

Brooksy6791

pressuredrop wrote: »

You know it makes sense.

Really ? Have I made that much of a mistake ?

jem16

Brooksy6791 wrote: »

Really ? Have I made that much of a mistake ?

Going with Abbey - yes.

whiteflag_3

jem16 wrote: »

Going with Abbey - yes.

Hi Jem

Could you be a bit more specific for the OP and explain and give your reasons for not going with Santander (abbey).

Perhaps you could suggest your alternative and the cost (if any ) involved


Thanks