LISA Stocks and Shares and JISA stocks and shares

Misd_sixties22

Hello,

Happy New Year!

Sorry for the listed questions but I'm hoping someone can advise me.  I have queried about S&S ISAs before and have just taken the plunge and opened one with Wealthify to ease me in (with the £40 cashback too). 

1. I am now wondering whether I should move my daughters' ISAs into a stocks and shares one. Both are dormant as I now put money into a separate account so they do not access it at 18.  My eldest is almost 11 and has about £3000 and my youngest if almost 7 and has £1400.  Is it too late for my eldest as she'd only has 7 years left? Also she gets about £60 per year in interest. Would a Stocks and shares be able to beat this? I was thinking about Fidelity for the lack of fees. Finally, if it doesn't work out, can I just transfer it back to a normal JISA?

2. I have a LISA with moneybox currently at a pretty poor interest rate. I had no idea that there were stocks and shares LISAs until reading on these forums recently. I am under 40 so should be able to transfer to one as I saw there were problems with those 40+. I presume I will get the government bonus as usual in addition to any increase of funds. However, if this doesn't work out, can I move it back to a normal LISA? I am 38 if that makes a difference. I also have a separate cash ISA  as well so not everything is in stocks.

Many thanks in advance.

Albermarle

 Is it too late for my eldest as she'd only has 7 years left? Also she gets about £60 per year in interest. Would a Stocks and shares be able to beat this?

Normally a time scale of 10 years + is recommended and anything below 5 years is not recommended. On average there should be a significantly better chance of growth than not over 7 years but not guaranteed of course. It could always be left longer than 7 years of course.

Regarding Point 2 then as you can not access a Lisa until you are 60, then you should have a S&S LISA.

However, if this doesn't work out, can I move it back to a normal LISA?

This question is a bit worrying . The last thing you should do if a S&S investment goes down/doesn't seem to be working out , is pull out . You must stick with it long term .

Alexland

In terms of the JISA it really depends when they are likely to spend the money as S&S investments are for the medium to long term to avoid needing sell when markets are down so 5-7 years minimum preferably much longer to average out the ups and downs. If the investment is sensible it shouldn't be dumped when markets are down as that just crystallises a loss. Markets will crash it's to be expected and OK provided you still have time ahead to recover. If you do decide to invest the JISAs then Fidelity are a good provider and have been very good with our kids' free accounts but as a DIY platform (unlike your experience with Wealthify as a robo) you have to make your own investment choices.
Assuming the LISA is for retirement (not buying a property) then cash is unsuitable as the interest rates are below inflation so your money will lose spending power each year. Assuming you won't access for over 20 years to avoid the penalty) then that's plenty of time for a sensible S&S investment to to deliver a very good result. Pick your S&S LISA provider carefully as you may not be able to transfer after turning 40.
Also if you are putting money away for retirement consider if you might do better making more pension contributions.

cloud_dog

Misd_sixties22 said:

Hello,

Happy New Year!

Sorry for the listed questions but I'm hoping someone can advise me.  I have queried about S&S ISAs before and have just taken the plunge and opened one with Wealthify to ease me in (with the £40 cashback too). 

1. I am now wondering whether I should move my daughters' ISAs into a stocks and shares one. Both are dormant as I now put money into a separate account so they do not access it at 18.  My eldest is almost 11 and has about £3000 and my youngest if almost 7 and has £1400.  Is it too late for my eldest as she'd only has 7 years left? Also she gets about £60 per year in interest. Would a Stocks and shares be able to beat this? I was thinking about Fidelity for the lack of fees. Finally, if it doesn't work out, can I just transfer it back to a normal JISA?

2. I have a LISA with moneybox currently at a pretty poor interest rate. I had no idea that there were stocks and shares LISAs until reading on these forums recently. I am under 40 so should be able to transfer to one as I saw there were problems with those 40+. I presume I will get the government bonus as usual in addition to any increase of funds. However, if this doesn't work out, can I move it back to a normal LISA? I am 38 if that makes a difference. I also have a separate cash ISA  as well so not everything is in stocks.

Many thanks in advance.

Just to add, a child can hold both a cash and S&S JISA, so depending on age, risk tolerance, future usage, you may want to consider if that works for you / them. 

Ours has two, cash one started a couple of years ago (gosh only 4 months to go), and a S&S one since birth.  I am hoping they will use the cash one for now / spending requirements, and the S&S to continue invested, possibly for property purchase options, but there will be plenty of time to figure that out.

Misd_sixties22

Thank you for all your thoughtful comments. It sounds like an investment ISA is the best way to go longtermand I may invest my youngest's ISA into a stocks and shares one too. Thanks again.

LDee23

Hi everyone asking for help please! 

I have only started saving in a LISA from September. Me and my partner are looking to buy a first home but it may be sooner than September. Should I withdraw my Lisa money as soon as possible and pay the fine and put the money and savings from now on into my high interest savings account if we are getting a house before my 12months of having a Lisa?
or what should I do 

Albermarle

LDee23 said:

Hi everyone asking for help please! 

I have only started saving in a LISA from September. Me and my partner are looking to buy a first home but it may be sooner than September. Should I withdraw my Lisa money as soon as possible and pay the fine and put the money and savings from now on into my high interest savings account if we are getting a house before my 12months of having a Lisa?
or what should I do 

You should have started your own thread rather than jumping on one that is nearly 3 years old.

However the answer is that house buying can be fraught with delays, even after you have found somewhere. That in itself could take many months, even years.
So probably best to hang on to the LISA until you are farther along the house buying process.