24 Year old needing sound advice!

Poolside007

Hi all, I have a good chunk of money sat that i’m not doing along with and a strong income from my employment. I am looking at putting some money in a S&S ISA and then paying in monthly - This will be for a medium term investment 5-10 years. 

Can anyone advice me on the best to use, i have seen vanguard, iweb and many others mentioned and also which funds to consider.

Thanks in advance.

csgohan4

https://monevator.com/category/investing/passive-investing-investing/

is a good resource

5 years would be too short for long term investments

Otherwise premium bonds would be a safe bet

You need to formulate your own investment strategy and know what your risk appetite, everyone on here will recommend different Funds, ETI e.t.c

But we can point in you a general direction once you have done some research

Stay away from speculative forums and the like for now, until you gain more experience and research. You will be met with hundreds of different investment funds e.t.c don't be overwhelmed, focus on what you need, not what you want

Poolside007

csgohan4 said:

https://monevator.com/category/investing/passive-investing-investing/

is a good resource

5 years would be too short for long term investments

Otherwise premium bonds would be a safe bet

You need to formulate your own investment strategy and know what your risk appetite, everyone on here will recommend different Funds, ETI e.t.c

But we can point in you a general direction once you have done some research

Stay away from speculative forums and the like for now, until you gain more experience and research. You will be met with hundreds of different investment funds e.t.c don't be overwhelmed, focus on what you need, not what you want

Thanks I’ll check out the website you have posted. 

5 years would be absolute minimum in all honesty, I can deposit 10k and pay £350-400 a month comfortably for the foreseeable future. My risk appetite is medium.
I work in power generation so would also be considering a renewable energy fund as I know that is most definitely the future, amongst more general index trackers. I’m still reading and checking out all options so any other good resources you can share would be appreciated.

Albermarle

If you have a 'strong income' hopefully you are making more than the minimum pension contributions , especially if you are a higher rate taxpayer .
For sure a pension is not accessible for a long time but the tax benefits are positive.
Also when considering what to invest in for your S&S ISA and how much , you should look at the bigger picture . Means pension, mortgage, cash savings , future expenditure etc and not look at the S&S ISA in isolation.

enthusiasticsaver

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

Poolside007

enthusiasticsaver said:

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

For this specific lump sum amount no I won’t need it as I have other funds. 

I’m currently looking to buy a property, potentially a cash buyer depending on type of property I buy. Although the low interest rates are appetising as i would be able to get a good LTV rate.

I currently have no debt with around 70k at hand that is sat in saving accounts as well as some company shares certificates i have that are ~70k currently market value. A relatives house sale is going through where I will also gain around another 100k gifted to use toward a property. 

That’s where my financials are at, hence why i feel i have money sat not making that much other than the shares which are performing well.

El_Torro

Many people on this forum (myself included) will tell you not to go too specific in your fund choices. Don’t go for a renewable energy fund, or a geographic specific fund (e.g. US only). 

Your best best, especially with the sums you’re talking about, is to invest globally, in a multi asset fund. For example Vanguard Life Strategy, or HSBC Global Strategy, or similar.

MaxiRobriguez

Poolside007 said:

enthusiasticsaver said:

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

For this specific lump sum amount no I won’t need it as I have other funds. 

I’m currently looking to buy a property, potentially a cash buyer depending on type of property I buy. Although the low interest rates are appetising as i would be able to get a good LTV rate.

I currently have no debt with around 70k at hand that is sat in saving accounts as well as some company shares certificates i have that are ~70k currently market value. A relatives house sale is going through where I will also gain around another 100k gifted to use toward a property. 

That’s where my financials are at, hence why i feel i have money sat not making that much other than the shares which are performing well.

Take advantage of low mortgage rates rather than buy the property outright. Like you say you will still have a decent LTV and you can use the money you save to push into your pension where you get tax relief.

You say you have £70k of company shares - are these in one company? The one you work for? If so, can they be sold with the money used to buy a more diverse fund?

Albermarle

Poolside007 said:

enthusiasticsaver said:

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

For this specific lump sum amount no I won’t need it as I have other funds. 

I’m currently looking to buy a property, potentially a cash buyer depending on type of property I buy. Although the low interest rates are appetising as i would be able to get a good LTV rate.

I currently have no debt with around 70k at hand that is sat in saving accounts as well as some company shares certificates i have that are ~70k currently market value. A relatives house sale is going through where I will also gain around another 100k gifted to use toward a property. 

That’s where my financials are at, hence why i feel i have money sat not making that much other than the shares which are performing well.

Your pension arrangements ?

Poolside007

MaxiRobriguez said:

Poolside007 said:

enthusiasticsaver said:

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

For this specific lump sum amount no I won’t need it as I have other funds. 

I’m currently looking to buy a property, potentially a cash buyer depending on type of property I buy. Although the low interest rates are appetising as i would be able to get a good LTV rate.

I currently have no debt with around 70k at hand that is sat in saving accounts as well as some company shares certificates i have that are ~70k currently market value. A relatives house sale is going through where I will also gain around another 100k gifted to use toward a property. 

That’s where my financials are at, hence why i feel i have money sat not making that much other than the shares which are performing well.

Take advantage of low mortgage rates rather than buy the property outright. Like you say you will still have a decent LTV and you can use the money you save to push into your pension where you get tax relief.

You say you have £70k of company shares - are these in one company? The one you work for? If so, can they be sold with the money used to buy a more diverse fund?

Yes that was my thinking i have been looking and can get a very low and fixed for 4-5 years with ability to make overpayments. What length of mortgage term is most beneficial do you think as I’m looking at around 15-20 years. 

Yes they could be sold to invest in a more diverse fund, but still brings me back to the deciding of what fund and who with - both of which i’m still learning the options.

Poolside007

Albermarle said:

Poolside007 said:

enthusiasticsaver said:

As Albemarle says look at opening an S and S ISA in conjunction with your other financial planning. 

Do you have a future use for the money you intend setting aside in the ISA?  Do you have a pension? What about a house? 

There is lots of information around about the types of funds and whether you go for actively managed or index trackers.  There are funds geared towards ethical  investments or renewable energy. You say medium risk but that assumes you are comfortable with maybe seeing your capital drop by up to possibly 25% or 30% or more.  If you are young then you have plenty of time to make that up but if you have an intended use for the money within 5-10 years you may want to consider something less volatile. 

Do you have other savings?  Emergency fund etc etc?  What about debt or a mortgage? 

For this specific lump sum amount no I won’t need it as I have other funds. 

I’m currently looking to buy a property, potentially a cash buyer depending on type of property I buy. Although the low interest rates are appetising as i would be able to get a good LTV rate.

I currently have no debt with around 70k at hand that is sat in saving accounts as well as some company shares certificates i have that are ~70k currently market value. A relatives house sale is going through where I will also gain around another 100k gifted to use toward a property. 

That’s where my financials are at, hence why i feel i have money sat not making that much other than the shares which are performing well.

Your pension arrangements ?

I have my works pension, i contribute 5% they put 10%. I’m in the process of contacting them to up my payments if possible which i believe it is. 

Can you or someone explain the tax benefits of putting money in a pension, and why it’s attractive for someone of my age to be piling money into it opposed to easily accessible ISAs and savings accounts. Apologies for my ignorance if that comes across as stupid.