Starting off investing

jimmyjones_2

lost_in_the_woods wrote: »

These fees seem a lot if I am only investing about £1k a year.

I have just started out investing monthly into mainly hsbc trackers and am in the process of transferring my isa from iii.co.uk to Cavendish Online due to iii's new quarterly charge.

Cavendish would be one of your cheapest options with zero annual fees - ideal for drip feeding into tracker funds at your level of investment. Cavendish only allow you to invest in funds so not suitable if you want to invest in shares / ETF's etc.

lost_in_the_woods

MrInvestor wrote: »

Firstly, well done for working hard to get to where you are. For a young age you are certainly on the right road to success. What area do you work in out of curiosity?

One thing you should remember when deciding where to invest, is that the rate of inflation reduces the purchasing power of your money. For example, today you can buy 100 loaves of bread for £100. If the rate of inflation stays at say 5%, then in 12 months time, you will only be able to buy 95 loaves of bread for £100. It is a pretty simple thing but well worth remembering.

Aside from the property I own, I have substantial holdings in gold bullion which I have had for about 30 months. I have also hedged in other areas including emerging markets and some UK based companies. However I believe that gold is the safest place to hold my capital in today's uncertain economic climate.

Another suggestion if I may, (and I am 100% guilty of ignoring people when they told me this) try to save more than you are proposing. At some point in a few years time, you will sit down and wonder where all your money has gone.

All the best!!

I studied Mechanical Engineering at Uni (first person in my family to go to Uni) then started my job last September. I work as a Well Engineer / Drilling Engineer in the Oil Industry. I was over the moon to be offered the job as there were only 8 vacancies but over 1800 people applied for it. I now almost earn as much as both my parents combined.

The job helps me save when I’m rig based as I only have ½ my time on land to spend my money (but rent/bills, council tax etc stays the same) and as we can’t claim holidays we get about 8% extra pay. But when I am office based I still save over £500 a month. Rent is a major drain as Aberdeen is a rip off (no matter what size, location or condition, 1 bed flats are £550-600 a month!!).

I don’t fancy (being heavily in) gold as I expect the markets will improve in under 5 years and when it does I believe lots of people will look to get out of gold and into shares which would drop the value. Having said that if I was wanting to physically buy a krugerrand or sovereign (maybe to give as a gift) where would I get one from other than the internet as I don’t want to get scammed.

I could put more in but I want to test the water to begin with. Also I want to stay heavily in cash at the moment so if my parents lose their jobs I can step in to pay their mortgage until they get back on their feet.

lost_in_the_woods

jimmyjones wrote: »

I have just started out investing monthly into mainly hsbc trackers and am in the process of transferring my isa from iii.co.uk to Cavendish Online due to iii's new quarterly charge.

Cavendish would be one of your cheapest options with zero annual fees - ideal for drip feeding into tracker funds at your level of investment. Cavendish only allow you to invest in funds so not suitable if you want to invest in shares / ETF's etc.

Thanks. I'll look into this.

Thrugelmir

lost_in_the_woods wrote: »

And of cause as soon as an article is posted it is out of date.

The market will always move quicker than you are able. So makes little difference.

Do your own research on a particular sector or industry.

gadgetmind

lost_in_the_woods wrote: »

I don’t fancy (being heavily in) gold as I expect the markets will improve in under 5 years and when it does I believe lots of people will look to get out of gold and into shares which would drop the value

Yup, and ditto for bonds

Your best approach is to hold a bit of everything but to be heavily biased towards equities. The books I recommended (even the creaky old classics) can explain this far better than I ever could.

Anthorn

How about investing in the future with an insurance product assuming that a pension is already arranged: There was a time when a tax free Friendly Society savings plan was an essential part of every savings/investments/insurance portfolio but in recent years have fallen by the wayside. But they still represent very good value especially when you start when relatively young.

For a representative example check out Scottish Friendly Society
http://www.scottishfriendly.co.uk/tax-free/flexible

gadgetmind

lost_in_the_woods wrote: »

These fees seem a lot if I am only investing about £1k a year.

With BestInvest, there is currently no feed for holding trackers other than Vanguard.

https://select.bestinvest.co.uk/investment-guidance/investor-insights/2011/wide-investment-choice

Of course, this could change, but you could always swap into a good global OEIC if this happened. Despite me being mostly in trackers, I do have holdings in M&G Global Basics, Rathbone Global Opportunities, and a few others.

psychic_teabag

gadgetmind wrote: »

With BestInvest, there is currently no feed for holding trackers other than Vanguard.

ISTR there's a custody charge for some gilt trackers. Eg looks like the L&G All Stocks Gilt Index atracts the custody charge.

gadgetmind

Ah, right, I didn't know that, thanks.

We pay the charge on both of our BI accounts so I never bother looking too closely.

Perelandra

Anthorn wrote: »

How about investing in the future with an insurance product assuming that a pension is already arranged: There was a time when a tax free Friendly Society savings plan was an essential part of every savings/investments/insurance portfolio but in recent years have fallen by the wayside. But they still represent very good value especially when you start when relatively young.

For a representative example check out Scottish Friendly Society
http://www.scottishfriendly.co.uk/tax-free/flexible

With an annual management charge of 1.5% on an L&G tracker-based investment, the tax benefit doesn't seem worth it.