stocks and shares investiing

triumph41

Hello.

We have a 12 month fixed bond from Santander which matures 01/05/12 with a total of £10,240. We have been offered their stockmarket savings bond 3.75 years or 6 years, reading their projections to me it doesnt look to bad. We like the idea that our initial investment is safe.

We are looking to invest for at least 5 years, We have been told about investing in an Index Tracker Fund this we believe tracks the Footsie 100, can either of these ideas be wrapped in a stocks and shares ISA. Who offers these and were do do I find these products?

We have done the usual investmens i.e paid of the mortage used our ISA's for the current tax year and have rainy day savings.

I am 51 and my wife is 50 and we would like to retire in 5,6,7 years. I have a small pension that is payable on retirement my wife has no interest in saving in a Pension. We have £525 that we recieve in rental from my Mums house every month that is mortage free.

Any help would be apprecited if any more info is needed then please ask.:T

TC

Lokolo

You like the idea of your investment being safe, well that can't happen with a FTSE 100 tracker. You can lose the amount you put in.

You also say you want to retire in 5,6,7 years, but you then say you have little pension and you wife doesn't have any! How are you going to live?

Rollinghome

triumph41 wrote: »

We have been told about investing in an Index Tracker Fund this we believe tracks the Footsie 100, can either of these ideas be wrapped in a stocks and shares ISA. Who offers these and were do do I find these products?

An index tracker fund can be held within an ISA and probably the most cost-effective way of doing that is either through Cavendish Online (here) or directly through fund managers such as HSBC or L&G. A fund following the FTSE All Share index would track a far wider range of companies.

Be aware that you may gain little or no advantage by holding small equity investments within an ISA if you pay the basic rate of tax. That's because outside of an ISA there is no further tax payable on dividends by a basic rate payer and the tax already paid can't be reclaimed within an ISA. All tax payers have an allowance of £10,600 a year before paying tax on capital gains so tax normally only needs to be paid on fairly substantial investments.

But... very importantly, you shouldn't take too much notice of the hype from investment salesmen on what you might expect from equity investments. Be realistic. The FTSE is currently well below where it was way back in 1998. Whether it will do better over the next 14 years is anyone's guess. Don't underestimate the effect of costs and salesmen's commissions.

You might also like to read a free book here . It's written by an amateur investor so don't take every word as gospel but it should give you a more realistic view of investment than the often Polyanna optimism of many newbie investors. Turn to page 99 for an overview.

triumph41

We currently have a house valued at £85000 which is mortage free and returns £525.00 per month plus we have another propery that is worth £90000 that will yeild £600.00 per month, along with our ISA's and other savings we would live off the two combined rentals of £1125.00 then down size our main property this would yeild approx £50000, this is what we are hoping will fund our retirement hopefully.

My question is how and were to invest this £10000 bond that matures in June 2012.

This is our plan does it sound possible or are we on the wrong track.

TC

jimjames

Lokolo wrote: »

You like the idea of your investment being safe, well that can't happen with a FTSE 100 tracker. You can lose the amount you put in.

I agree a FTSE tracker isn't a safe, guaranteed investment but I don't think it is fair to suggest that you could lose the entire amount you put in.

If the FTSE 100 was to drop to 0 that means that all the top 100 companies in the UK have no value in them which I think is very unlikely. It may (and has) dropped in the 50% range but to lose everything in a tracker doesn't seem likely at all