ISA about to reach £85K - what should I do?

LJH149

I don't know very much about S&S ISAs except that there is risk involved. But thanks for the tip, I'll look into it as an option.

colsten

adindas wrote: »

Is this 50k for investment and 85K for cash ISA per ISA provider or the total money invested/saved irrespective of how many providers.

So say 80k cash ISA in provider A and another 80K cash ISA on provider B. IS this sum of 160k is still protected or not?

For investment ISA 50k what the FSCS protection is involved, it is the original value of investment you put or what?

FSCS protection is per financial institution, where a financial institution is defined by their FCA Licence number. Only a few providers offer both, cash and S&S ISAs. Generally speaking, the S&S ISAs offer by these providers are not value for money, and you'd be much better advised to use an investment platform for your S&S ISA.

Money invested in S&S ISAs is covered by the FSCS but only up to £50,000 per fund manager. For example, if you have more than £50,000 invested in three funds by the same fund manager and fund manager goes bust, you will only get £50,000 back. But if you invested three lots of £50,000 with three different fund managers and all three went bust you would get all your money back. The value of the investment would be the last traded value before they went bust.

eskbanker

LJH149 wrote: »

I don't know very much about S&S ISAs except that there is risk involved. But thanks for the tip, I'll look into it as an option.

There is of course risk involved in staying in cash too - as things currently stand it's a stick-on certainty that your money will lose its value in real terms because interest rates are below inflation.

Investing does indeed also involve risk but it's a different type of risk, i.e. there is no capital protection and the growth over time isn't linear in the way that cash deposits are, as there is volatility along the way with spikes and troughs. However, a well-diversified portfolio should comfortably outperform cash deposits over the long term.

Many savers are understandably nervous about the prospect of investing but it's a myth that investing = risk and cash = no risk!