What to do with 7k???

donttaxme

Hi guys,
I have 7k to invest(dont know in what which is where you guys hopefully come in....)

I prob wont need to use this 7k for at least 5years, so dont mind if its tied up...
would ideally like to add 1k a year to it....

any ideas????

thanks.

dunstonh

About 10,000 or so options at this stage. You will need to narrow it down a bit more. Risk profile, taxation, you own personal ideas on where and how you want to invest would all impact on what would be suitable.

brasso

Well, 7K is the maximum annual investment in a tax-efficient equities ISA, so that would be a good candidate. Visit the Hargreaves Lansdown website for some background info into ISAs -- though there are plenty of other companies you could invest through.

But as dunstonh says, the key question is your attitude to risk. If you're happy to take a bit of risk, equities could suit.

donttaxme

trying for little or minimal risk to be honest...
dont really want to get involved in high risk schemes(even though the eventual rewards will proabbly be bigger...)
thoughts?

dunstonh

There is a world of options between little/minimal and high risk. You dont have to be at either extreme.

Rhino666

If you are risk averse probably best to avoid shares....

You could open a mini cash isa now for 2006/7 and another in April for 2007/8 - that would clear up £6k.

Quasar

I am about to close my Abbey National Maxi ISA and open a cash ISA with them at 8% tax free! £3000 cash in the ISA, and the rest in an account tied up for at least 3 years at 9% (not tax free).

tom188

Quasar wrote:

I am about to close my Abbey National Maxi ISA and open a cash ISA with them at 8% tax free! £3000 cash in the ISA, and the rest in an account tied up for at least 3 years at 9% (not tax free).

hmm so you get 8% on half your investment for a year, and at least 2.9% on the other half (annualised 9%). So thats 5.45% average minimum in your first year followed by 4.2% average minimum in the other two years based on current interest rates. Hardly stellar is it?

Im sure you could do better with your money than with one of these awful GEBs. 50% return of the FTSE 100, not great is it particularly since this is a rubbish index to track - if you think the market is going to go up buy a tracker or any other decent fund and at least get the full return. if you think its going to go down put it in cash or some other asset class.

Quasar

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tom188 wrote:

hmm so you get 8% on half your investment for a year, and at least 2.9% on the other half (annualised 9%). So thats 5.45% average minimum in your first year followed by 4.2% average minimum in the other two years based on current interest rates. Hardly stellar is it?

Im sure you could do better with your money than with one of these awful GEBs. 50% return of the FTSE 100, not great is it particularly since this is a rubbish index to track - if you think the market is going to go up buy a tracker or any other decent fund and at least get the full return. if you think its going to go down put it in cash or some other asset class.

Sorry, but I never said that was half of my investment. I have accumulated a lot more than that over the years in my cash component. I can only put £3000on the new cash ISA - the rest of the money will go into the other account. the 9% is per annum. I do not invest in shares, and my shares component on the Maxi ISA is not a lot and I'm doing away with that too, because I prefer a lower but more secure return.

cheerfulcat

Sorry, but tom is right ( assuming that you are referring to the Super ISA ). The 9% is over the term, and it is a GEB, linked to stock market returns. And you have to put as much into the GEB as you put into the cash ISA, so it is half of your " investment ".

dunstonh

You also mention more secure but as I mentioned higher up, you seem to be focusing on the two extremes. There are an awful lot of options in between which could be far more suitable for you.