S&S ISA beginners advice please

Sunshine_and_Roses

I have not used any of this years ISA allowance yet, and currently have approx £20,000 to save or invest.  I have maxed out premium bonds, and have two years worth of ISA allowance saved in one year fixes.  The majority of my pensions are in DB, with a couple of very small DC, one of which I am still paying into with my part time job.

I feel that I should be investing some money rather than just saving in a cash ISA, and thinking that a S&S ISA may be a good starting point for me.  I have read through the guides but would not have a clue what funds to choose.  Would a managed ISA be the best option?  I would be looking to leave the money for up to 10 years, but would not be adding regularly to it.  My other option is just to stick it in a Chip cash ISA.

Any thoughts or suggestions would be appreciated, thanks.

El_Torro

Generally speaking you should invest for at least 10 years to be sure that your investment will give you a better return than cash. 5-10 years is sometimes quoted so there is some leeway. 

Based on solely what you are saying in your opening post I would probably go for a multi asset fund that is roughly 60% equities and 40% bonds. The bonds are there to reduce the volatility, so you won't see swings as big as if you were 100% equities. There will still be swings though. 

There are various 60/40 multi asset funds to choose from. This article goes through some of the more famous ones: https://monevator.com/passive-fund-of-funds-the-rivals/

Beddie

There are lots to choose from. In the "medium risk" category this one is popular, but there are many others, as el_torro above has linked to.

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/h/hsbc-global-strategy-balanced-portfolio-c-accumulation

As for platforms, do you already use one? If not, iweb is popular. No monthly fee and and owned by Lloyds Bank, so safe and reliable. https://www.iweb-sharedealing.co.uk/

Sunshine_and_Roses

Beddie said:

There are lots to choose from. In the "medium risk" category this one is popular, but there are many others, as el_torro above has linked to.

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/h/hsbc-global-strategy-balanced-portfolio-c-accumulation

As for platforms, do you already use one? If not, iweb is popular. No monthly fee and and owned by Lloyds Bank, so safe and reliable. https://www.iweb-sharedealing.co.uk/

Thank you.  Don't have a platform so will have a look at this. Much appreciated. 

Albermarle

How to invest in a stocks and shares Isa: The quick and easy guide | This is Money

Tonski

Here are a couple of good videos comparing of all of the S&S ISA providers:
https://youtu.be/1UM4oaZpLaY

The BEST Stocks and Shares ISA UK in 2024 (Detailed ISA Comparison) (youtube.com)

I personally use Invest Engine and i'm very pleased with them. I'm also planning opening an ISA with trading 212. Most of the other providers will be more expensive in terms of fees but will have a wider choice of funds. If you're new to investing, then the wider choice is probably a bad thing as you just need something simple.

I would highly recommend that you stay away from the managed funds. The fees are always very high compared to what you can pick for yourself. 85% of actively managed funds don't beat a simple market weighted index fund and this percentage gets higher over time. 

I found this video helpful when understanding the factors behind selecting a fund:
https://youtu.be/k1BHFCHpae8

Your allocation of stocks to bonds really comes down to your acceptance of risk. If i was leaving my money in for 10 years, I would go for 100% stocks but if you're not comfortable with the increased fluctuations, then a 60:40 split is a safe choice. Your returns will likely be lower, but it will be a much smoother ride.

dunstonh

Objective first.  Then solution to match that objective.  So, what is the objective with this money?

If you need the money next year, then cash ISA.  If you need the money in 5+ years then the ISA wrapper.   If you need the money post age 57, then pension wrapper (pension beats ISA for most people if the objective fits).