S&S Isa newbie advice welcome

Armchair23

Hello all
I'm in my mid fifties and haven't used my S&S allowance before (monies went to pensions, paying off mortgage etc). Obviously I could go to an IFA but given the fees involved would I be as well to choose a 'recommended in the financial pages' S&S ISA or should I accept that paying for advice is the best option.
I'm sure this is a how long is a piece of string question, but I'm attempting to be more pro active with my finances after my husband's death and £5,340 is a reasonable sum to use as a starting point for exploring options.
TIA

jem16

Armchair23 wrote: »

Obviously I could go to an IFA but given the fees involved would I be as well to choose a 'recommended in the financial pages' S&S ISA or should I accept that paying for advice is the best option.

This depends on whether or not you feel you could DIY. There are about thousands of funds, let alone direct shares etc, etc that you could place inside a S&S ISA. Would you know what to choose?

I'm sure this is a how long is a piece of string question, but I'm attempting to be more pro active with my finances after my husband's death and £5,340 is a reasonable sum to use as a starting point for exploring options.
TIA

First question you should ask yourself is what are the goals for this investment? Are you willing to tie up the money for at least 5 years and preferably 10 years or more.

Rob_IFA

jem16
Fair points but again the most important thing is not necessarily what do i want to achieve but what am i prepared to lose. When you know that you can than plan your goals and realise the timescales involved more clearly

jem16

Rob_IFA wrote: »

jem16
Fair points but again the most important thing is not necessarily what do i want to achieve but what am i prepared to lose.

Risk tolerance is of course important but I feel that timescale is first and foremost.

For example if I wanted the money to buy a house in 2/3 years, would you be advising a S&S ISA?

Rob_IFA

Hi jem 16
something to remeber about about most ISAs is that you can actually get the money at anytime. So if you were saving for a house you would look at the following:

1. How much do you have?
2. How much do you need?

If you have say £10k and need £20k you would consider the merits of having a high risk poart of the portfolio and vice versa if you have £10k and need £12k. Bearing in mind you have £ 10680 stocks and shares ISA allowance each year of which half can be invested in cash, you should always use your allownace up first, even if you are only investing in cash.

Then if you have gone the cash route, each year you would take the cash out of bank accounts and use your cash ISA allowance.

Hope I am not rambling but hopefully you get the picture

jem16

Rob_IFA wrote: »

If you have say £10k and need £20k you would consider the merits of having a high risk poart of the portfolio and vice versa if you have £10k and need £12k.

2/3 years is not high risk in my opinion. It's basically gambling on the stock market not taking a dive just when you need the funds.

No problem with cash ISA.

dunstonh

2/3 years would mean an S&S ISA would be daft to use for all but the very highest risk individuals and experienced investors.

Armchair23

Thank you all for your responses

1. What is your attitude to financial loss? It could be that the recommend ISA from the paper could be in a fund that could loose a lot more in one year than you can accept. As an IFA I would ensure that a full risk profile exercise is undertaken to ensure you invest in the correct area

Hmm an ISA recommended by an IFA could fall in value as well, though if you offer a guarantee your my man !

2. The annual S& S ISA allowance is actually £10680 per annum. The amount you refer to is for cash only
I have used my cash portion so I belive that's what remains available to me.
3. The fees charged by the non IFA ISA can sometimes be more than the charges made by IFAs especially upfront.
Sorry, Martin seemed to say otherwise, my mistake I was planning on using HL
4. As part of the fees i would also review your whole situation not just thos area, to ensure you are in the right place with things.
Thanks, I have an IFA, I just wondered on this amount of investment whether this was a good place to be more proactive.


I don't have a specific goal with this sum of money, i.e. it's outside of what I need to support me and isn't needed to pay off a loan etc., I'm content with a five year plan. I was thinking of something like Invesco Perpetual High Income or Managed Distribution or Jupiter Financial Opportunities

Anyhow I'll keep reading your comments and following the threads with interest. Many Thanks

jem16

Armchair23 wrote: »

Sorry, Martin seemed to say otherwise, my mistake I was planning on using HL

HL will give you part of the amc back ( depending on choice of fund) once you have at least £1000 in each fund. So starting off you may not get this discount unless you are planning on investing as a lump sum.

Thanks, I have an IFA, I just wondered on this amount of investment whether this was a good place to be more proactive.

Have you asked your IFA about using your S&S ISA. If you already have a relationship with the IFA then adding a S&S ISA may not cost much at all.

I don't have a specific goal with this sum of money, i.e. it's outside of what I need to support me and isn't needed to pay off a loan etc., I'm content with a five year plan. I was thinking of something like Invesco Perpetual High Income or Managed Distribution or Jupiter Financial Opportunities

It is an opportunity to learn if you want to do this.