Opinions please on £3,000 investment

hanbut

Hello my daughter (18) has been given £3000 by my Mother which is to be invested until she is 25. Is this worth going to a IFA for help on investing? or maybe just put it in an ISA? All opinions are welcome. Thank you

Added Information. The money is cash and she has agreed to invest it as we bought her a car!!

xrjtg

An IFA is unlikely to be cost effective on such a small amount. ISAs are sensible if your daughter isn't using hers already, but are just wrappers: are you looking at cash or stocks and shares?

Is the gift in trust or is it just up to your daughter not to spend the money until she's 25? That might affect people's answers a bit.

dunstonh

If you have a family IFA already then they will do it. However, if you have no existing relationship with an IFA then it's not going to be cost effective for the IFA to do it (either for the IFA or your daughter).

hanbut

Thank you, My Daughter has 'agreed' to reinvest the money as the intenion was for all the Grand children to have the money when they were 25 but two have now reached the age and my mother just wanted to hand it out. I had thought about Stocks & Shares rather than cash isa as there is enough time for the markets to recover and hopefully make a profit!. We have no IFA so understand it would not be viable. I was planning of adding a small amount say £50 a month to the isa as a sweetener for her keep the money there. Thank you

Primrose

You don't say if your daughter is working yet and a taxpayer, so you have the option of investing the money in a cash ISA, a stocks & shares ISA, or looking around to find a fixed rate bond which is paying the best rate of interest you can find (if your daughter is a non taxpayer and likely to remain so because she's a student, she can fill in an R85 form to have interest paid free of tax). Nobody knows how the stockmarket will perform over the next seven years, so that route would be a gamble and your daughter would have to be prepared to lose money just at the time she perhaps wanted it for the deposit on a property. Or you could play slightly safer and put £1500 into a cash ISA and the other £1500 into an equity ISA for her on the hope of making some growth.

hanbut

Hello She is a non tax payer at the moment, but I am hoping that will change!! she is looking. Thank you, I guess hedging the bets is the best way. Thanks again