Cash doing Nothing, Poor Financial Management

shaz77_2

I've been doing a little bit of a spring clean on my finances and I've realised that my finances are not as well structured as they should be.

I have utilised my ISA allowance for the year of £3000, I have some money in Premium bonds, some money in an Icesave account and some in a post Office account however I have an additional £5000 sitting in a current account doing absolutely nothing which is very poor financial management on my part.

Does anyone have any recommendations as to where I could invest it, I have been thinking about stocks and or shares but I'm willing to listen to suggestions before I make a move.

jem16

You still have £4000 of your ISA allowance that you are not using.

You should think about sorting out a S&S Mini ISA. You can use shares or funds from a fund supermarket. For those wanting to organise it themselves, Hargreaves Lansdown seems to be the popular choice.

H&L ISA

Jonbvn

I agree with jem16, some exposure to S&S would be good. It is very important that you go through a fund supermarket to reduce charges.

SME is not in favour of PB's, as per the link. Have you considered NS&I index linked savings certs? They are good when the RPI is high (like now!). You can invest upto 15k per issue.

CLAPTON

what are your circumstances? are you a home owner? if so then paying the mortgage might be a good idea, if not are you likely to want to use the money to buy something soon?

you need to give quite a lot a of details about your circumstances before sensible advice can be given
like
age
income
housing situation
housing plans
pension situation
attitude to risk
family situation.. OH, kids

shaz77_2

CLAPTON wrote: »

what are your circumstances? are you a home owner? if so then paying the mortgage might be a good idea, if not are you likely to want to use the money to buy something soon?

you need to give quite a lot a of details about your circumstances before sensible advice can be given
like
age 23
income 15000 p/a
housing situation Living with parents
housing plans Plan to buy a house in the near future (6 months)
pension situation Work related pension scheme
attitude to risk I accept risk is a necessity
family situation.. OH, kids None

Some good overall advice given, what is the best way to get involved in a mini ISA s&s?

pjala

shaz77 wrote: »

Some good overall advice given, what is the best way to get involved in a mini ISA s&s?

Post a question to dunstonh, who helps anyone on the board here with questions like that, or go see an IFA who will charge but will sort you out with investments that suit you.

If you go for advice just from here or from another bulletin board, they will be pushing their favourites and it won't make any sense for your perspective.

jem16

shaz77 wrote: »

Some good overall advice given, what is the best way to get involved in a mini ISA s&s?

You say you plan to buy a house in about 6 months time. If that £5000 is to be part of your deposit then forget about S&S ISA. You need at least a minimum of 5 years for an investment to allow time for a recovery if necessary.

Stick to savings accounts like Sainsbury's bank at 6% or Icesave at 5.93%.

If the £5000 is for long term (5-10 years or more) then look at S&S ISA.

plonkee

The best way to get involved in a mini stocks and shares ISA is to read around a bit.

What I would suggest doing, is thinking about your overall risk tolerance - the classic question being what would you do if the stock market / fund went down by 40% within a year.

In any case you want to consider an overall portfolio and invest in several different funds - maybe two or three at a minimum - so that you are diversified. You could then put less money in riskier funds and more money in more conservative funds.

Opening an S&S ISA with a fund supermarket is often a good idea (like Fidelity or H-L) because you have more choice in investments - its easier to ditch one if you realise you've made the wrong decision.