What recourse is there now?

cheerfulcat

oldfella wrote: »

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depends on the investment, there are many funds showing v substantial growth over the same period

How many of them are guaranteed to give you at least your money back? How many of them are fixed term? You can't compare normal collective investments to protected capital products.

jamesd

savvygirl, easy first step, stick 7000 in cash in the Hargreaves Lansdown Stocks and Shares Maxi ISA if you haven't used any of your ISA limit this tax year. That puts it in pure cash, at effective 3.25% taxed at 20% interest, while you do more learning - so you can relax and learn without losing this year's allowance.

Can do the same in the new tax year and that's 14,000 growing with tax protection.

That leaves 46,000 to put somewhere, perhaps directly into unit trusts and investment funds.

However, before proceeding, it's really a good idea to find out more about you, since your own situation decides what type of tax wrapper (pension, ISA, investment bond) is best for you. Are you a higher rate tax payer? Are you retired? Are you planning to keep the money until you retire or use it sooner? When you retire what total taxable income from all pensions do you expect - get a State Pension Forecast - since that affects whether you need more pension, ISA or investment bond investing. What other income do you expect (from ISA investments, say, which don't count against age allowance reduction but do count against benefits). Key taxable income thresholds are whether it'll be below around 8000 or may be above 20000. What is your marital state, approximate age and planned retirement age?

What is your normal day to day income source? Benefits? High earnings from a job? At home and partner earning?

All sorts of nosy questions that help to make one choice better than others or rule out some as unsuitable.

How much risk - up and down in value over the years - can you accept on a scale of 1-10? Would you worry about losing 20% in one year? 40%? 50%? Assuming that you get it back over the next 3-5 years. Higher risk means bigger value swings but also higher potential growth. Searching here for "sector allocation" and "asset allocation" would also be helpful.

KTF

jamesd wrote: »

savvygirl, easy first step, stick 7000 in cash in the Hargreaves Lansdown Stocks and Shares Maxi ISA if you haven't used any of your ISA limit this tax year.

Is this the Vantage ISA on their site or another one? The Vantage ISA seems to allow you to pick the funds you want to invest in.

EdInvestor

savvygirl wrote: »

Thanks to everyone. I realise it could have been much worse. But I was hoping for some sort of modest return. However, I now have to make up for lost time, interest-wise. Anyone with any bright ideas where to invest £60K (currently parked with Icesave). (not so) Savvygirl

A better way to take a bit of risk, but reduce the chance of losing capital ( which I assume was the idea with the bond) is to keep the majority of the capital on deposit at good interest rates,so you know it will grow if you reinvest the interest, and just invest a small chunk at risk.

Let's say you invested 14k, as your timing is excellent for this year's and next year's tax free maxi ISAs, leaving the other 46k earning interest in cash.

I would suggest as follows:

Open an ISA account with a discount broker, eg

https://www.h-l.co.uk

which will rebate much of the charges on your investment back to you, and stock the ISA with cash, first 7k for this year and then another 7k for next year (after the end of the tax year in early April) for a total of 14k.

Now what do you want to invest it in? You already have 76% of your capital in cash, so there is not a lot of point IMHO in putting any of the other money in bond funds, which are low risk, like cash.

I suggest it should go into equities (shares) and (commercial) property funds.
Shall we say 4k into property (2 funds) and 10k into equities (4 or 5 funds)? This is the eggs in baskets rule, another way of reducing risk.

Next step is to have a good look around on the HL site, especially reading up on its info about good funds.Take your time. When you have got together a few funds that look interesting, check back in here for a view to make sure you're on the right track.

After you've invested all the money, I suggest you check it regularly, say once a month.This is easy to do online at HL. You may decide later that actually you can cope with more risk, and want to move more over to equity funds from your cash account (saves on tax too, if you are a BRT).

But again, just take your time.It's a learning process.

It's possible you may find you hate the whole idea of investing and are much happier in cash.But most people do get used to the "volatility" ( prices wobbling up and down) after a while, and history of course proves that over the long term, equities will greatly outpace cash. .

In any case, nothing ventured, nothing gained

dunstonh

If you feel that its going over your head, then seek advice from an IFA (not a bank). There are some investment products out there that offer investment funds but you can buy capital security. I wouldn't use them for myself or most investors as a cautious portfolio without guarantees is cheaper than one with and the amount of risk on a cautious portfolio isn't as much as most people think. However, if you are desperate to have it "guaranteed", then there are options available to you.

oldfella

depends on the investment, there are many funds showing v substantial growth over the same period

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cheerfulcat wrote: »

How many of them are guaranteed to give you at least your money back? How many of them are fixed term? You can't compare normal collective investments to protected capital products.

I dont see the problem in the comparison - there are obvious differences in the structures, but they are usually invested in the same things - equities. All of my fund investments are substantially up over the same period. Clearly there is going to be a cost for the guarantee - Fix term doesnt seem to be a benefit to me. Just making the point that the base investment also did not do as well as it could have.

dunstonh

You can also build your own GEB (in effect) but then that is what many cautious portfolios do. Such as 30% stockmarket (typically income generating) and 70% non stockmarket to offset it.

cheerfulcat

Just making the point that the base investment also did not do as well as it could have.

But there is no base investment with these GEBs, just a deposit account and some derivatives - they are not like managed funds.

jamesd

KTF, yes, it's the Vantage ISA. The cash option you get when starting it up is a good way to save the annual limit, then you can learn and pick the funds you want later.

You can also hold funds outside an ISA there and move them into the ISA later, subject to the normal ISA limits.