index traking ISA from .comdirect

edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings
9 replies 865 views
slh012slh012 Forumite
3 Posts
edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings
hello!

im a bit new to all this investing stuff.

ive got premium bonds right now (£500) and havnt won a thing. id like to move my money into a more efficient and long term investment.

I was thinking a index tracking maxi ISA against the FTSE 100 (iPLAN) from https://www.comdirect.co.uk is this a wise choice, seems the FTSE may be entering a period of growth (is this right??)

will be investing a max of £100 / month over the period of the investment.

any help or advice greatfully recieved.

slh

Replies

  • dunstonhdunstonh Forumite
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    Its hard to say whether a tracker is right at this time. It certainly hasnt been for the last 5 years. UK Equity & Income funds have been the area of choice, as far as UK goes.

    Personally, i think UK Equity & Income will remain the place too due to the emphasis on dividend income and the volatility of the UK stockmarket. However, lets see in 5-10 years time which was best.

    Like most things, the best option is a portfolio of funds/sectors rather than 1 fund and hope for the best. £100pm can get you upto 4 funds and that would be the better way to do it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • MJSWMJSW Forumite
    171 Posts
    If you intend to invest £100 per month, you don't really need a maxi ISA. A mini stocks and shares ISA would be sufficient, as you could invest upto £4,000 per tax year. That would then leave you the option of putting up to £3,000 per tax year in a mini cash ISA too.
  • slh012slh012 Forumite
    3 Posts
    thanks for advice so far.

    I didnt think i have enough 'eggs' to invest in different 'baskets', might have been wrong

    thanks again.
    slh
  • dunstonhdunstonh Forumite
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    slh012 wrote:
    thanks for advice so far.

    I didnt think i have enough 'eggs' to invest in different 'baskets', might have been wrong

    thanks again.
    slh

    Depends on where you buy the ISA. The most popular internet portal uses cofunds and they allow £50pm per fund so you can do 2 with them. There are a few that allow £25pm but I dont believe you can do those ones direct.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • carnetcarnet Forumite
    501 Posts
    As far as I can recall, M&G allow monthly investments as low as £10/month into their vast range of UT's/OEICS so you could set up a nice little low cost, well diversified, portfolio.

    You would have to deal with them direct, thus precluding any initial charge discounts/annual commission rebates from discount brokers but, again without checking, I think that many, if not all, M&G funds have zero IC.
  • dunstonhdunstonh Forumite
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    You would have to deal with them direct, thus precluding any initial charge discounts/annual commission rebates from discount brokers but, again without checking, I think that many, if not all, M&G funds have zero IC.

    According to the M&G website, they discount their 5% initial charge by 2%. This is not as good as what is available from a discount IFA. You would also be limited to M&G funds.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • carnetcarnet Forumite
    501 Posts
    dunstonh wrote:
    According to the M&G website, they discount their 5% initial charge by 2%.

    Well, both BestInvest and HL list 40+ M&G retail funds where they state that the normal M&G IC (ie not their own discounted IC) is nil. This could, of course, only be true in respect of lump sum investments and not regular savings - from a quick look the M&G website seems a little hazy on charges. Not having personally invested in any M&G fund for some years, the only way to check this out would be to ring them for clarification.

    This is not as good as what is available from a discount IFA.

    I thought the point was to construct a well diversified portfolio for £100/month ? I don't know any discount broker who will offer discounts on less than £50/mth per fund - and two funds can hardly be described as a good spread of investments - even if they're "Managed" or "International".

    You would also be limited to M&G funds.

    The only reason for suggesting M&G is that their £10 minimum monthly investment per fund is considerably less than other fund management groups. However, having said that, M&G have a very large range of well run funds from which to choose - and the overall performance of the group has improved considerably in recent years, especially their income producing funds - for which they have always been renowned.
  • dunstonhdunstonh Forumite
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    BestInvest and HL may have negotiated terms that suit their platform. The charges on funds varies between the fund supermarkets/wraps.

    I just took a quick look on Cofunds and found that M&G initial charges were typically between 3 and 5% (although one was 0%). An IFA could do 3% reduction on the intial charge (except the 0% one). For reference I picked cofunds purely as they allow regulars and mini ISAs (unlike some of the others) and i can log into their site and access the charges information quickly. This is not a recommendation or a suggestion. Purely information for debate purposes.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • carnetcarnet Forumite
    501 Posts
    dunstonh wrote:
    An IFA could do 3% reduction on the intial charge (except the 0% one). For reference I picked cofunds purely as they allow regulars and mini ISAs (unlike some of the others)

    Perhaps so, but aren't you missing the point which was, I thought, to construct a well diversified portfolio for £100/month ?

    Cofunds, AFAIK, will only accept a minimum of £50 per month per fund, therefore one would be limited to two funds. Or, are you saying that an IFA would offer a 3% discount on a £10/mth regular saving - if so, I have yet to meet one ;).

    Even if one had to pay M&G's discounted IC of 3% (ie 5% less their 2% discount) it is, IMHO, a small price to pay for a good spread of funds for your £100/mth.
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