Reeves' ISA review

happybagger

boingy said:

Can anyone else see the folly in banks "encouraging" people to "take more risks with their savings"? Sounds like a future mis-selling scandal to me.

Or at least commission earning - they'll love this idea of "encouraging investment" [into their own products]

jimjames

Ocelot said:

x44 said:

Japan's Nikkei 225 index being an extreme case in point.

Reached a peak of 35000 in 1989 and took till Jan 2024 to exceed that number for the first time since 1989.

It took the FTSE 100 over 20 years to match its 1999 index value.

There's lies, damn lies and statistics. Not quite a correct statement to claim that it anyone would have made no money as the index value is just one part of the return and completely ignores the impact of dividends which is substantial as well as assuming everyone put all their money in at a single point in time.

Ocelot

jimjames said:

Ocelot said:

x44 said:

Japan's Nikkei 225 index being an extreme case in point.

Reached a peak of 35000 in 1989 and took till Jan 2024 to exceed that number for the first time since 1989.

It took the FTSE 100 over 20 years to match its 1999 index value.

There's lies, damn lies and statistics. Not quite a correct statement to claim that it anyone would have made no money as the index value is just one part of the return and completely ignores the impact of dividends which is substantial as well as assuming everyone put all their money in at a single point in time.

My point wasn't that investing necessarily loses money, but that the Nikkei 225's index value recovery time wasn't that far off the FTSE's recovery time.

Alpine_Star

This story hasn't gone away, at least for the FT.

MeteredOut

Or its a slow news day and the papers need something to print to get those much needed clicks.

(I don't think the "reduce the cash element of the ISA" ever went away, but the "reduce the total allowance from £20K" did, and its the former that's resurfaced here)

ColdIron

If I recall it never went away, it was simply 'paused' and still 'under review'

From July:
https://forums.moneysavingexpert.com/discussion/comment/81537455/#Comment_81537455

eskbanker

City minister Lucy Rigby told an Investment Association dinner on Tuesday that savers could more than double their savings if they chose to invest in the stock market. “We are committed to building a shareholding democracy,” she said.

“Someone who put away £1,000 in a cash Isa every April since 1999 would now hold about £34,000. If they had instead invested in a stocks-and-shares Isa, they could now have around £83,000.” 

Unhelpful oversimplification there - despite the vested interest and the audience, someone in her role really ought to recognise the important differences between saving and investing!

Sea_Shell

If a lower cash ISA limit came in, I'm guessing that would stop me using T212 in the way I do.

ie, funding via the cash element (debit card), then moving the funds, internally, into the QMMF side.

Rather than funding the Trading account directly.

MeteredOut

Sea_Shell said:

If a lower cash ISA limit came in, I'm guessing that would stop me using T212 in the way I do.

ie, funding via the cash element (debit card), then moving the funds, internally, into the QMMF side.

Rather than funding the Trading account directly.

What's the benefit in doing it that way?

Shylock_249

I’d like to know how it would “help” the government if I invested 20k in S&S as opposed to 20k in savings?

 As I see it, if the government sold off one of its nationalized industries (are there any left?) and I bought shares directly, on floatation the government it would get the money.  However, if I were to buy existing shares in a company which already has shares, I’d effectively be buying from someone else.

 Is if for consideration that Reeves is NOT concerned that investors could make more money in S&S than savings in a bank but is more interested in lowering the amount which could go into tax free savings and HMRC would tax savers on interest earned on the rest of the savings?

 If she was purely interested that savers could earn more by investing she could just leave things as they are and just educate would be savers, eg make every bank/bs put a proviso in their small print along the lines of “As a saver you realise that you could earn more money by investing in S&S?”

Even better, “As a saver you realise that you could earn more money by investing in S&S and “Remember Railtrack and other failures?”