Cash vs. Stocks & Shares ISA

misteranderson

Hi. We've just inherited some money and as a new ISA investor I just wanted to be clear that the only difference between putting your full allocation (£7200) into a Stocks and Shares ISA as opposed to splitting it and putting some into a Cash ISA is down to the risk of the returns?? I'm thinking about 50:50 in each using both mine and my wife's allowances but just wanted some other views.

Also planning on doing the same with the new 2010 allocation (£10,200) for both of us straight after the 6th of April to get the benefit of a full years interest for next year – again is this correct?

Thanks!

ses6jwg

50:50 is usually a sensible split.

I tend to fill my ISA with self selected funds and big dividend FTSE 250 stocks like Shell

LionKing

Do all stock and share ISA's have a holding fee?

I am with Hagreaves Lansdown. They want to charge 0.5% annual holding fee for having stocks within my ISA

Am i better off just buying stocks outside of ISA to skip this charge as understand the only benefit to purchasing stocks within ISA is CGT (i am unlikely to hit my CGT allowance threshold)

Lokolo

Shares are usually best bought through iii as they are cheapest.

Funds through HL.

misteranderson

Thanks but are you all saying that you don't put anything into Cash ISA's? and ust put it all in Stocks and Shares?

ses6jwg

As said, III do not charge a fee for the ISA, but they generally have higher charges on funds (though still much cheaper than direct).

They also a sharebuilder scheme, you can buy shares/ ETFs commission free on set dates until June, normally £1.50 sharebuilder or £10.50 (I THINK) ordinary transaction

LionKing

misteranderson wrote: »

Thanks but are you all saying that you don't put anything into Cash ISA's? and ust put it all in Stocks and Shares?

No. Use my cash allowance up first

Aegis

I don't use any of my cash ISA allowance any more. I prefer the stocks and shares ISA benefits (though I intend to build up enough of an investment pot to eventually be concerned about CGT, and at some point I imagine I'll be a higher rate taxpayer). It's a personal choice, there is no single right answer other than to try and use as much of the allowance as your investment strategy allows.

G_M

Everyone's requirements are different. There is no 'right' answer!

For any investment in stocks and shares (including unit/investment trusts etc), whether within an ISA or not, you need to plan 5 years investment at least.

Cash ISAs, like any savings account, are much more 'liquid'.

Before deciding you need to assess your overall financial situation. do you have other savings you can call on? How much? If a crisis occurred in your life might you need to call on this money urgently?

etc etc.

Trek

Do iii charge if you open an account and its left inactive? Thinking about opening an account now but not looking to buy shares at this moment in time. Still researching which shares to buy.

G_M

Do iii charge if you open an account and its left inactive?

No. (unless T&Cs have changed - check smallprint!)