Help ! Money has more than doubled !

brasso

EdInvestor wrote: »

Sure but you would be mad to do so. You should add to the ISA every year so that when you retire you have a great big pot of capital generating an income and not only is it all tax free, you don't even have to tell the taxman it exists.

Absolutely agree, Ed. It was just an academic question so that I understood the principle. Just today in fact, I've put my £7K into this year's ISA, and would urge people to save some money this way.

cheerfulcat

nellykim wrote: »

ps.. how on earth does a person keep track of their taxes, etc. which may or may not be due, if they make money regularly over time ?

By keeping records, either with pen and paper or using a spreadsheet. There is also software available which will track a portfolio.

jem16

EdInvestor wrote: »

The tax on this works like this: for capital gains, anything up to the annual allowance of just over 9k is tax free. For dividends, assuming you are a basic ratre taxpayer, no tax to pay as it's covered by a tax credit which comes with the dividend.

Except if you are a basic rate taxpayer whose dividends PLUS the tax credit push you into the higher rate tax bracket. Then you have another 25% tax to pay.

missile

nellykim wrote: »

I mean, how would the taxman know ?

When you invest you are asked for your NI number.
Financial institutions are obliged to inform the tax man of any taxable gain over a certain amount. If you do not declare it ............. expext to get a letter from the IR:o

cheerfulcat

I've never been asked for my NI number by a broker and nor would I expect to be. You are supposed to report your gains yourself. Though I suspect that you may be right that large gains are reported.

Biggles

You're only asked for your NI number when you open an ISA, so CGT isn't an issue then.

I don't believe brokers report 'taxable gains'; it would be very nice if they did the calculation, though, as it would save me the trouble!

nellykim

Hi and thanks to everyone who is contributing. I am learning.

EdInvestor, you gave good advice saying that you should add to the tax-free ISA up to £7000 each year if you can afford, and that made me SEND that cheque back to Abbey- NOT tear it up !

After all, I can draw it out if I need it cant I ?

Hopefully I will have a big pot of capital in a few years that will generate an income, like you say.

(Where would the best place be, for the money, to generate that income, or is that a daft question ?)

-Who needs financial advisers when you have money-saving experts like you lot ! -

thanks !

baby_boomer

I think you're seeing the possibilities, nelly.

Doubling the first investment is the hard part. Your original investment only goes up 100% when you do that.

If you double again then the 200% is added to the original investment.

After a while, it is even possible to start to get annoyed that you haven't added 100% of the original investment in a year :eek:.

Some income investors have even achieved 100% income from their original capital over time - having allowed the income to roll up over many years. I'm currently up to 16% potential income on one such long term investment.

That's the beauty of compounding .

dunstonh

two and a half years ago I invested ten thousand into abbey multi manager equity accumulation shares, and totally, their valuation today is around twenty one thousand pounds.

It seems too good to be true

It does seem too good to be true.

That fund has only grown 59.53% in 3 years and is bottom quartile (for YTD, 6 months and 3 years). It is a poor quality investment and the stats dont match your figures.

apparently its a high risk investment.

It's medium risk, not high.

Not trying to knock what you have done but your figures dont match suggesting you are missing something here.

nellykim

Hallo Dunston

I got a valuation on the £7000 and the £3000, last week.

The £7000 one has a valuation at present, of £17000 ,( the total is filed away in a drawer, exact total, around £17300 or something near, give or take a hundred or so.. and the £3000, is valued at £4537.21( or abit more now), so, the total, if I cashed in would be around twenty one and a half thousand.

I have these amounts written down on their 6 monthly statement ( which I get twice yearly , and when I check, over the phone, its always gone UP

The latest was this week ( Wednesday), so I dont understand what you are saying about it being TOO GOOD TO BE TRUE, but I am willing to listen

thankyou