How to invest for a 29 yr old!

jord22

Hi! 
Just looking for a little bit of advice if possible! 
More and more people my age starting to invest in fractional shares, ISAs etc with a longer term view of having a larger pot of cash one day. 
The two things I've got my eye on are: 
Royal Mint's Digigold 
Vanguard S+p 500 etf (using Trading 212 app) 
I have a little bit of money to play with each month and zero idea how it all works and what I should/shouldn't be doing. 
Can someone please give me a bit of a steer? 

eskbanker

Plucking apparently random investments out of thin air may well be suitable if it's just "a little bit of money to play with", but if you're serious about investing then having a more structured plan would be a much better idea - best bet would be to research on other newbie investor threads on here and also sites such as:

https://www.moneyadviceservice.org.uk/en/articles/investing-beginners-guide

https://www.hl.co.uk/beginners-guides/investing

http://www.monevator.com

http://kroijer.com/

http://diyinvestoruk.blogspot.com/

https://www.ifa.com/indexfundsthemovie/

as well as bearing in mind a number of key points of principle:

1. Only consider investing once you have adequate accessible cash reserves.
   
2. Only invest if you're happy to commit for at least 5-7 years and preferably 10-15 or more.
   
3. Diversify - ignore individual shares, etc, and concentrate on collective investments that spread your eggs over many baskets. Global multi-asset funds are a good place to start, available from the likes of HSBC Global Strategy, Vanguard LifeStrategy, Blackrock MyMap and L&G Multi-Index, with a comparison offered at https://monevator.com/passive-fund-of-funds-the-rivals/
   
4. Choose what you want to invest in before considering which platform to hold it/them on.
   
5. Keep an eye on ongoing costs for funds and platforms - they shouldn't be the primary consideration but can make a noticeable difference over the long term.
   
6. Use a Stocks & Shares ISA as a tax-efficient wrapper to avoid liability for income and capital gains tax.

[Deleted User]

Yawn..
You're 29..
Learn risk tolerance. 
Consider your next 20 years of investing in individual stocks' i - f you lose,- as your "playing fields of Eton" education.
That's not a glib remark, sport teaches children to be good winners and good losers. 
 

eskbanker

Without wishing to replay another thrilling episode of the whole 'individual shares versus collective investments' debate, I'd agree that there are no doubt plenty of people who have the time, ability and inclination to make a long term success out of researching and buying individual stocks.

However, I'd suggest that there wouldn't be much of an overlap in the middle of the Venn diagram featuring those people and those who post on a forum saying "I have [...] zero idea how it all works and what I should/shouldn't be doing"....

steampowered

If you need to ask this question, it would be recommended to invest in a low cost globally diversified stock market tracker fund. That way you will get the average performance of the entire market, without needing to worry about picking the right stocks. Tracker funds tend to outperform stock pickers anyway. 

The Vanguard S&P500 ETF would be a good choice.

The Vanguard FTSE All-World UCITS ETF is probably an even better choice as it is more globally diverisifed. S&P500 is obviously US focussed.

Digigold is not a good idea. Gold and silver are non-productive assets. They don't pay dividends.

It is worth opening a stocks & shares ISA. That way you will have no capital gains tax to pay when you sell, and no income tax to declare on dividends. You will need to go with a proper broker for that, not trading 212. Holding your stocks in an ISA might not make much difference now if you are starting with a small sum of money, but it will make an enormous difference later on as your portfolio grows over time.

wmb194

steampowered said:

It is worth opening a stocks & shares ISA. That way you will have no capital gains tax to pay when you sell, and no income tax to declare on dividends. You will need to go with a proper broker for that, not trading 212.

Trading212 offers an Isa.

[Deleted User]

eskbanker said:

Without wishing to replay another thrilling episode of the whole 'individual shares versus collective investments' debate, I'd agree that there are no doubt plenty of people who have the time, ability and inclination to make a long term success out of researching and buying individual stocks.

However, I'd suggest that there wouldn't be much of an overlap in the middle of the Venn diagram featuring those people and those who post on a forum saying "I have [...] zero idea how it all works and what I should/shouldn't be doing"....

Of course not because, to torture the playing field analogy, you don't learn sportsmanship (or risk tolerance)  from a book.

jord22

steampowered said:

If you need to ask this question, it would be recommended to invest in a low cost globally diversified stock market tracker fund. That way you will get the average performance of the entire market, without needing to worry about picking the right stocks. Tracker funds tend to outperform stock pickers anyway. 

The Vanguard S&P500 ETF would be a good choice.

The Vanguard FTSE All-World UCITS ETF is probably an even better choice as it is more globally diverisifed. S&P500 is obviously US focussed.

Digigold is not a good idea. Gold and silver are non-productive assets. They don't pay dividends.

It is worth opening a stocks & shares ISA. That way you will have no capital gains tax to pay when you sell, and no income tax to declare on dividends. You will need to go with a proper broker for that, not trading 212. Holding your stocks in an ISA might not make much difference now if you are starting with a small sum of money, but it will make an enormous difference later on as your portfolio grows over time.

Thanks - so, just so I'm clear. If I set up a Trading 212 account, I can invest in the Vanguard FTSE or S&P AND open a Stocks and Shares ISA? 

IvanOpinion

jord22 said:
Thanks - so, just so I'm clear. If I set up a Trading 212 account, I can invest in the Vanguard FTSE or S&P AND open a Stocks and Shares ISA? 

You are thinking about this wrongly.  What you want to do is open an S&S ISA and then invest in your chosen funds within that ISA.  The ISA is just a tax friendly container into which you can place your chosen investments.

jord22

IvanOpinion said:

jord22 said:
Thanks - so, just so I'm clear. If I set up a Trading 212 account, I can invest in the Vanguard FTSE or S&P AND open a Stocks and Shares ISA? 

You are thinking about this wrongly.  What you want to do is open an S&S ISA and then invest in your chosen funds within that ISA.  The ISA is just a tax friendly container into which you can place your chosen investments.

Hence me asking! 
Trading 212 have a waiting list, so I think I'm going to go with a Vanguard ISA and then invest through that.

Thrugelmir

What are you saving for?  Set your objectives first. Then decide on the most appropriate investments.