Shares ISA - Would I be wasting my money?

frothy-coffee_2

jimjames wrote: »

Hargreaves Lansdown and iii do not charge annual management fees for most funds.

Thanks,
Would you know if you can purchase iShares ETF's via these brokers?

jimjames

frothy-coffee wrote: »

Thanks,
Would you know if you can purchase iShares ETF's via these brokers?

You certainly can but they aren't the cheapest for investments other than unit trusts.

Why are you looking at ETFs rather than funds? If this is your first share investment I would think that funds would be a better startng point

frothy-coffee_2

jimjames wrote: »

Why are you looking at ETFs rather than funds?

I've read some good things about them

frothy-coffee_2

jimjames wrote: »

Why are you looking at ETFs rather than funds? If this is your first share investment I would think that funds would be a better startng point

What sort of funds do you mean?

switch76

If you aren't going to invest more than £5100 then I wouldn't bother putting it in an ISA.

Even if you made 10% each year, your £5100 would be worth £13,228.09 after 10 years. You wouldn't have CGT to pay.

frothy-coffee_2

switch76 wrote: »

If you aren't going to invest more than £5100 then I wouldn't bother putting it in an ISA.

Even if you made 10% each year, your £5100 would be worth £13,228.09 after 10 years. You wouldn't have CGT to pay.

I agree with what you say. But if I invested my half my ISA allowance in a Shares ISA every year, then CGT could be a consideration

switch76

frothy-coffee wrote: »

I agree with what you say. But if I invested my half my ISA allowance in a Shares ISA every year, then CGT could be a consideration

If you plan on adding money every year rather than a one-off, then an ISA would be useful.

You will be sheltered from CGT. You also don't have to pay income tax on bonds. Your dividends will still have income tax taken off before you receive them.

I think TD Waterhouse has no administration fee for shares, funds and ETFs providing your account is worth £5100 or more. HL will charge you 0.5% admin fee for shares.

Eco_Miser

Another advantage of using an ISA is that you don't have to tell HMRC, you don't have to keep track of when you bought shares/funds, or how much for, or how much you paid the broker - all potentially needed to report a capital gain outside an ISA. Remember in future you may have other capital gains that all crystallise at once when you need the money quickly.

jimjames

switch76 wrote: »

If you aren't going to invest more than £5100 then I wouldn't bother putting it in an ISA.

Even if you made 10% each year, your £5100 would be worth £13,228.09 after 10 years. You wouldn't have CGT to pay.

I'm afraid I disagree. It may not be of benefit now but if it is no more expensive in an ISA as outside then it is worth doing. If you become a higher rate taxpayer or tax rules change then at least it is protected within the ISA.

switch76

jimjames wrote: »

I'm afraid I disagree. It may not be of benefit now but if it is no more expensive in an ISA as outside then it is worth doing. If you become a higher rate taxpayer or tax rules change then at least it is protected within the ISA.

The trouble is that many providers charge a admin fee for ISAs. You mentioned HL, which is good for funds but may charge up to £200 admin fee each year for shares. If you only intend to invest £5100, why bother with the hassle.