Tracker funds and ISAs

johnr621

I am thinking of investing a lump sum of about £100,000 in a tracker fund. I was originally considering a managed fund and with that there was said to be an option of the fund manager putting my £15,400 allowance's worth into an ISA for this year, then transferring the same amount in each year until the total amount is in (in around 7 years' time). Can anyone tell me if it would be possible for me to do this myself with the funds I would have in the tracker?
Thanks in advance to anyone who can offer advice.

Linton

johnr621 wrote: »

I am thinking of investing a lump sum of about £100,000 in a tracker fund. I was originally considering a managed fund and with that there was said to be an option of the fund manager putting my £15,400 allowance's worth into an ISA for this year, then transferring the same amount in each year until the total amount is in (in around 7 years' time). Can anyone tell me if it would be possible for me to do this myself with the funds I would have in the tracker?
Thanks in advance to anyone who can offer advice.

Easy. You set up an ISA with an online broker. See monevator. Then each year you use the website facilities to transfer in the maximum allowance as cash via a debit card and then buy your chosen fund(s).

Alternatively you could set up an ISA with some fund managers but that would only give access to the chosen manager's funds and so could severely limit your options. It may be cheaper though.

Mistermeaner

Yes.

It's such a strange question I'm possibly misunderstand ing but just open an s+s isa with charles stanley or someone else cheap and put 15k in the tracker fund you want. Repeat each tax year.

The money not in the isa can be invested anywhere including into the identical fund if you wish.

No need for a fund manager to be involved - at least in the isa vs non isa bit

colsten

The same online brokers will also offer a non-ISA account where you can invest the £85K you can't put into your ISA now. Then, each year move some more into the ISA from your unwrapped investment account. Google "Bed and ISA"

dunstonh

I am thinking of investing a lump sum of about £100,000 in a tracker fund.

That is pretty awful quality investing. Especially on that amount. Do you really think one sector is going to be the best one every year going forward?

I was originally considering a managed fund and with that there was said to be an option of the fund manager putting my £15,400 allowance's worth into an ISA for this year, then transferring the same amount in each year until the total amount is in (in around 7 years' time). Can anyone tell me if it would be possible for me to do this myself with the funds I would have in the tracker?

Yes, you can bed & ISA yourself. The fund has nothing to do with bed & ISA. The fund is where you invest. The administrator/broker/adviser is the one that does the work if you do not.

Sam_J12

dunstonh wrote: »

That is pretty awful quality investing. Especially on that amount. Do you really think one sector is going to be the best one every year going forward?

Please stop spouting this nonsense. You know nothing about the OPs personal finances and what other investments and assets he has.

If a single tracker (S&P 500) fund is good enough for John Bogle and Warren Buffet to recommend I imagine it would be fine for OP.

dunstonh

If a single tracker (S&P 500) fund is good enough for John Bogle and Warren Buffet to recommend I imagine it would be fine for OP.

Please stop spouting that nonsense. What he says to US investors in a different tax regime and with inward looking mentality is very different to what he does.

Plus 100% in an S&P500 tracker would be speculative risk/volatility and way above the tolerance of a typical UK consumer. Especially one investing for the first time.

You are the one in the wrong as your recent threads have shown.

You know nothing about the OPs personal finances and what other investments and assets he has.

True. However, the question, as asked, comes across as someone with no knowledge of investing. The op is free to expand on his/her situation if they want to.

EdSwippet

dunstonh wrote: »

That is pretty awful quality investing. Especially on that amount. Do you really think one sector is going to be the best one every year going forward?

The OP did not mention a sector. A single large holding in one of the Vanguard LifeStrategy funds, for example, would be a perfectly fine investment strategy now and into the future.

darkidoe

Yes to the original question, you can DIY it yourself easy enough.

If I had that much sitting around and considering funds, I would consider going SIPPs after ISA. 20% boost to the cash pile straight off the bat. Unfortunately OP doesn't mention what's his objectives are with this sum of cash.

dunstonh

The OP did not mention a sector.

The OP said " am thinking of investing a lump sum of about £100,000 in a tracker fund. ". That means they were looking at a single sector fund.

single large holding in one of the Vanguard LifeStrategy funds, for example, would be a perfectly fine investment strategy now and into the future.

VLS is not a tracker. Its a fettered fund of funds. Also known as a multi-asset fund. Multi-asset funds are suitable as a single holding as they diversify within the fund.

johnr621

Thanks for all the replies. I see that this is an area where agreement is by no means universal.
To address the uncertainty about my financial situation and aspirations: We are selling up our house, downsizing and retiring (aged 60). The process should nett us about £300,000. We will be setting some aside to plug the gap between now and receiving the state pension in 6 years, putting that where we can get hold of it when we need - 3 Santander 123s, a couple of other low interest accounts, premium bonds and keeping existing ISAs. We decided to put half the rest in a tracker fund, as the costs of a managed fund for that amount seemed to be wiping out any potential increase in returns we could see.
I did always understand that we could put £15400 in this year (each) then do the same for the next couple (and a bit) years, but it is the question of what to do with the money between now and next (and the next) April that troubles me. I wanted to get it all in the fund now and have it working for us straight away, though we would be paying tax on two thirds of any interest earned. There was a suggestion from an IFA that that could be done with a managed fund. Is that what the term "bed & ISA" refers to?
I was actually looking at some of the Vanguard funds, so I hope I'm not being too foolish. As for SIPPS; a lot of googling pointed me in that direction, but I wonder if it is too late for that for us. My wife has already retired and I will be doing so, and drawing my workplace pension, in about 3 months.