Stocks & Shares ISA - Where to start?

gazza85

Hi,

I've been spending my spare time trying to research Stocks & Shares ISAs over the past few weeks and still not 100% sure what is the best option for me.

I have saved for a Deposit + Moving / Decorating costs & have 3 months living expenses saved (Based on outgoings with overpaying mortgage etc) and now wanted to look more into the medium / long term..

I'm currently cosidering either investing via Vanguard in the LifeStratergy 80% or Via a fully managed Nutmeg Account - Portfolio 8 or 9. I would only be starting off with £500 and making monthly deposits of £80-£100. My plan was to let this build up over a few years before transfering to an ISA where I could be slightly more hands on in the future. I'm not worried about taking some risks with this as I will also be increasing my current savings on a monthly bases. 

I was just after a second opinion on this and whether anyone had any better suggestions for me to get started?

Thank you for your help....

Speedbird676

Out of the two options you've given I'd go with VLS80. But someone will be along shortly to give much more detailed advice.

Why wouldn't you put that into an ISA from the beginning?

Alistair31

gazza85 said:

Hi,

I've been spending my spare time trying to research Stocks & Shares ISAs over the past few weeks and still not 100% sure what is the best option for me.

I have saved for a Deposit + Moving / Decorating costs & have 3 months living expenses saved (Based on outgoings with overpaying mortgage etc) and now wanted to look more into the medium / long term..

I'm currently cosidering either investing via Vanguard in the LifeStratergy 80% or Via a fully managed Nutmeg Account - Portfolio 8 or 9. I would only be starting off with £500 and making monthly deposits of £80-£100. My plan was to let this build up over a few years before transfering to an ISA where I could be slightly more hands on in the future. I'm not worried about taking some risks with this as I will also be increasing my current savings on a monthly bases. 

I was just after a second opinion on this and whether anyone had any better suggestions for me to get started?

Thank you for your help....

Why not open in an ISA in the first place ? Vanguards own platform would be good for your investing profile/frequency. If after a few years you have sufficient knowledge/funds/balls you could transfer your ISA to a platform that allows you to invest in funds/shares out with Vanguards limited range.

ColdIron

Unless you have used your full allowance I can think of no good reason not to use an ISA from the outset. It's just a tax wrapper and, by and large, you can invest in much the same things that you could in a non tax privileged account with much less hassle. If I had to choose between Vanguard and Nutmeg I would go for vanguard (although there are others). It seems tailor made for your small sums and regular contributions

gazza85

Speedbird676 said:

Why wouldn't you put that into an ISA from the beginning?

I have been saving into a HTB ISA (reached the maximum bonus level) until recently and had my mortgage approved / offer accepted etc (this is now stalled in the later stages of the legal process) all my other money was split between varying accounts earning between 3% - 5%. All my regular savers are now ending over the next month or so, which is why im now looking at my next step. I'm planning on opening a Cash ISA to store the 3 months expenses, Top up a second account to be dipped into for christmas / holidays etc and then pay into the S&S ISA replacing my regular savers.

ColdIron said:

 If I had to choose between Vanguard and Nutmeg I would go for vanguard (although there are others). It seems tailor made for your small sums and regular contributions

If you could choose from a larger pool?

Thrugelmir

To even start considering self managing I suggest a 6 figure portfolio as the minimum. VLS80 should be one of the primary building blocks in this process. 

ColdIron

gazza85 said:

If you could choose from a larger pool?

With small sums and regular contributions you want a percentage fee provider that doesn't charge for transactions, so Vanguard Investor fits that bill, 0.15% is as cheap as it gets. If you are happy with one of their Lifestrategy products (and at this level there is no reason why you shouldn't be) then look no further

If you wanted a single multi asset fund (and with a small pot you definitely do) that wasn't a Vanguard product then most providers with the same fee structure would do. Hargreaves Lansdown have a good novice friendly website with good customer service. They are one of the most expensive platforms for funds at 0.45% but after a year you will have £1,700 invested (an average balance of about half that) so even they would only cost three or four quid, the price of a large cappuccino

Speedbird676

gazza85 said:

If you could choose from a larger pool?

Possible options:
Vantage Life Strategy
HSBC Global Strategy
L&G Multi Index Funds
Blackrock Consensus
Architas Passive

However, as others have noted, going with VLS via Vanguard's own platform would be very cost effective.

badger09

OP you might want to rethink whether a Cash ISA is the best home for your 3 months expenses. Unless you expect to earn over £1k interest (£500 if you're a higher rate taxpayer) then you're better off with a normal savings account, though there's not much in it. Marcus is still paying 1.3%
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

You haven't said where your regular savers are held, but most of them can be renewed after maturity (sadly not Nationwide's) and some are instant access.   

gazza85

badger09 said:

OP you might want to rethink whether a Cash ISA is the best home for your 3 months expenses. Unless you expect to earn over £1k interest (£500 if you're a higher rate taxpayer) then you're better off with a normal savings account, though there's not much in it. Marcus is still paying 1.3%
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

I have setup a marcus account for this and will hold the 3 months expenses there, thank you.

You haven't said where your regular savers are held, but most of them can be renewed after maturity (sadly not Nationwide's) and some are instant access.   

I've been paying the maximum into First Direct @ 5%, Nationwide @ 5% & Club Lloyds Regular saver @ 2.5%.

badger09

gazza85 said:

badger09 said:

OP you might want to rethink whether a Cash ISA is the best home for your 3 months expenses. Unless you expect to earn over £1k interest (£500 if you're a higher rate taxpayer) then you're better off with a normal savings account, though there's not much in it. Marcus is still paying 1.3%
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

I have setup a marcus account for this and will hold the 3 months expenses there, thank you.

You haven't said where your regular savers are held, but most of them can be renewed after maturity (sadly not Nationwide's) and some are instant access.   

I've been paying the maximum into First Direct @ 5%, Nationwide @ 5% & Club Lloyds Regular saver @ 2.5%.

OK, well as at today, and obviously this might change by the time those regular savers mature, you can renew
First Direct but @ 2.75%
Club Lloyds @ 2.5% and you could also open a Lloyds monthly saver now  £250 pm @ 2%

Also Virgin Regular E Saver 15 (online account) £250 pm @ 2%
All of the above, apart from First Direct are instant access so worth drip feeding from Marcus. Don't hang around too long though as any of them could be withdrawn at any minute