ISA or not?

paperclap

Hi all,

I’d like to start making my money work, rather than depreciating.

Relatively new-ish to the realm of investing.

My plan, for now at least, is to deposit £200/month, minimum.

For now, I think the plan is to invest in the S&P, and perhaps a number of other funds.

Is an ISA account worth it, purely as they are tax free (up to £20,000)? An issue (or perhaps not an issue?), is that is seems most ISAs (taking Vanguard’s as an example), have relatively few funds to invest in.

Or is it better to invest outside the realm of an ISA, so more funds are available?

Thanks.

ZeroSum

Isa is just a tax wrapper so in terms of investing, there'll be just the same funds available. So not sure what you're looking at.

Vanguard has limited funds, as you can only invest in their own funds on their own  platform 

paperclap

ZeroSum said:

Isa is just a tax wrapper so in terms of investing, there'll be just the same funds available. So not sure what you're looking at.

Vanguard has limited funds, as you can only invest in their own funds on their own  platform 

Ah, thank you. I was indeed only looking at Vanguard, and (wrongly) assumed that all would have limited fund options available.

In which case, it sounds like an ISA is definitely the right thing to do then, for that tax wrapper? But, just perhaps not with Vanguard…! Unless I can find a good fund with them which fits the plan.

george4064

Alternatives to an ISA will be other wrappers such as a pension, LISA or general investment account. Depending on your financial circumstances will determine which wrapper is most appropriate for you.

There are also different funds to choose from which you invest in within a wrapper, platforms like Vanguard only offer their own funds but other platforms such as AJ Bell, HL, Fidelity, II, and others allow you to invest in many fund providers and are not limited to one.

A key factor in determining which platform is right for you should be; 1. Do they offer the right funds/investments I want to invest in? 2. Are the charges (platform, dealing and any other charges) competitive for me, my portfolio and how frequently I’m going to trade?

ZeroSum

laurencewhymark said:

ZeroSum said:

Isa is just a tax wrapper so in terms of investing, there'll be just the same funds available. So not sure what you're looking at.

Vanguard has limited funds, as you can only invest in their own funds on their own  platform 

Ah, thank you. I was indeed only looking at Vanguard, and (wrongly) assumed that all would have limited fund options available.

In which case, it sounds like an ISA is definitely the right thing to do then, for that tax wrapper? But, just perhaps not with Vanguard…! Unless I can find a good fund with them which fits the plan.

It's probably worth pointing out that Vanguard does have the lowest fees.
And if all you want is a simple index tracker then they're a pretty good option.

IloveElephants

Hi, I am wondering which Bank will offer the best interest rate for cash isa? I aim to open it with a deposit and just keep it in the account. I hope to look for a 2 year account. 

I was reading about Leeds building society however I had to send my original copy of passport/licence etc... Are they any other alternative banks? 

Thank you 

xylophone

https://moneyfacts.co.uk/isa/

grumiofoundation

IloveElephants said:

Hi, I am wondering which Bank will offer the best interest rate for cash isa? I aim to open it with a deposit and just keep it in the account. I hope to look for a 2 year account. 

I was reading about Leeds building society however I had to send my original copy of passport/licence etc... Are they any other alternative banks? 

Thank you 

Better to start your own thread not piggyback someone else's.

Especially when they are talking about stocks and shares ISAs (investing -capital at risk) and you are asking about cash ISAs (saving).

grumiofoundation

laurencewhymark said:

ZeroSum said:

Isa is just a tax wrapper so in terms of investing, there'll be just the same funds available. So not sure what you're looking at.

Vanguard has limited funds, as you can only invest in their own funds on their own  platform 

Ah, thank you. I was indeed only looking at Vanguard, and (wrongly) assumed that all would have limited fund options available.

In which case, it sounds like an ISA is definitely the right thing to do then, for that tax wrapper? But, just perhaps not with Vanguard…! Unless I can find a good fund with them which fits the plan.

What are you planning on investing in? Decide that first then decide on the platform.

Starting out investing a simple global index tracker or a multi-asset fund would probably be a sensible place to start looking. Vanguard (and others) offer these. As said vanguard are limited to their funds.

How long are you planning for investing for? Purpose of the money? 

Nardy

ZeroSum said:

Isa is just a tax wrapper so in terms of investing, there'll be just the same funds available. So not sure what you're looking at.

Vanguard has limited funds, as you can only invest in their own funds on their own  platform 

You are correct, but if you are new to the subject matter it is not always obvious. Some ISA providers write descriptions of their offerings in such a way that newbies may believe that an ISA is more than just a place to hold your investments..

dunstonh

It's probably worth pointing out that Vanguard does have the lowest fees.

Although it doesn't have the best trackers in all areas.  So, you may save a bit here, but it may cost you a bit there in differing performance.    And Vanguard doesn't have the lowest fees in most scenarios.   If the OP decides to use ETFs rather than UT/OEICs then others will come in cheaper.

The OP has indicated that they plan to build a portfolio using single sector funds rather than use a multi-asset fund.   So, being whole of market rather than restricted on the platform may well be better than that rather than focusing on a very small difference in charges.

However, £200pm it is probably better to use a multi-asset fund rather than trying to build a portfolio.

s that is seems most ISAs (taking Vanguard’s as an example), have relatively few funds to invest in.

Most platforms today are whole of market.   So, if you are seeing "most" ISAs as being restricted in fund choice then this is more likely down to where you are looking rather than the reality of the situation.     May its because the restricted offerings tend to advertise more than the whole of market offerings.