Long Term Saving

sharonjames

Hi, I have been saving for 15 years in a sun life monthly savings scheme which is due to finish in April. I want to start another one when this one finishes but Sun Life don't do them any more. Does anyone know of a similar long term savings account? I want to put away about £20 a month for 10 to 15 years. Thanks.

bigfreddiel

if i were you i would try to scrape up at least £50/month, then open an equity isa and invest in a low cost uk all shares index tracker. a ter of .5% or less should be your target.

over 15 years paying more that .5% is a huge amount of money to spend

typical fees can be 1.5- 2.5% and that extra few percent in fees doesn't sound like much but is infact a huge amount to pay.

fiesta04

sharonjames wrote: »

Hi, I have been saving for 15 years in a sun life monthly savings scheme which is due to finish in April. I want to start another one when this one finishes but Sun Life don't do them any more. Does anyone know of a similar long term savings account? I want to put away about £20 a month for 10 to 15 years. Thanks.

Before you think about a similar "savings scheme" do you know how much your current one will pay out?

On £20 monthly I would suggest find the best rate instant saver and fund that. You would probably have to move to a different account regularly to keep the best rates.

F4

Daniel_Elkington

Don't invest in a FTSE100 tracker, have you seen the returns that has been getting and the economic forecast for britain?

If you want to invest you need to examine your attitude to risk, more importantly your capacity for loss.

Risk/return is linked. If you want to double your money (100% growth) over the short term you must be prepared to lose it all (100% loss). Most people are somewhere between that and the capital guarantee (although guaranteed loss) of a bank account.

Bigfrieddel is partially correct. In order to get the right active managed fund you need to spend more and it is hard to select the right fund, precisely the reason most IFA's aren't bothering with fund selection any more.

However if you do get the right one's and review them often you can make a packet. My funds in ISA is medium risk and has made 3% more per year after charges than the mixed-investment 40-85% sector average for the past 4 years. That's a long boast but I've made some money.

If you got it wrong you could easily be 3%+ down per year!

Back to capacity for loss;

How likely is it that you would need to access the funds in case of short term emergencies (losing a job, going on a big holiday etc.)?

Have you got adequate rainy day funds in instant access cash ISA (I usually recommend 3-6 months of outgoings)?

What knowledge do you have of your own investments and the risks they carry?

What types of investments do you currently hold and how have you invested in the past?

jimjames

Don't dismiss a FTSE tracker purely on the UK economy. 70% of the income for FTSE 100 companies comes from outside the UK. Regardless of capital growth you'll be getting 3.5% dividends beating savings accounts. Just because it has done badly over a few years doesn't mean it will do so in the future - past performance is no prediction blah blah.

I would personally avoid any of the tax free plans as they are very poor value for money, inflexible and with high charges.

An ISA with one of the fund supermarkets would be an option, very flexible with low charges and can be stopped/started at any time but with monthly amounts from £50 so may be above your budget.