23yo - £100 pm - ISA vs Pension vs Sharesave

Wonka_2

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

eskbanker

Wonka_2 said:

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

What are the terms of the sharesave scheme?

InvesterJones

Not enough information to answer unfortunately. And what I'd do would be unique to my financial goals which probably won't match the person you're talking about. 

What other savings, investments and pension do they have?

Wonka_2

eskbanker said:

Wonka_2 said:

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

What are the terms of the sharesave scheme?

Was typing it out but probably easier to post the link https://www.shareview.info/mands/default.htm

Cisco001

Have you got a property or will you buy property, say by 30s?

Personally will skip M&S share save. I just don't feel retail industry will do any better in near future...

born_again

Wonka_2 said:

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

Share save depends on the option they are quoting compared to what it is now.
Daughter has 3 on the go at the moment.
1 is running at £6 a share over the option price at the moment. Way over CGT at the moment, to looking like a transfer to a S&S ISA when matures.
Other 2 are not as good, but will be a good return under CGT limit (at current level)

Ask other staff now they feel about the share save on this issue. As they will have the best idea if it's a good one or not.

DRS1

Personally I have always thought of Sharesave as a no brainer.  You don't lose even if the share price plummets as you get your money back plus whatever the interest/bonus is on the savings contract.

Incidentally the M&S stuff seems to suggest that only your savings get spent on buying shares under the option - I thought you could also spend the interest/bonus to buy the shares.  They also don't say what the interest rate/bonus rate is and I would have thought that was something he'd want to know.

I suppose the other thing to think about is where does he see himself in 3 years time? 3 years is a long time to a 23 year old.

Of course a pension and an ISA are also good things to do and he should do all three but none of the pension nor ISA will let him buy shares at a discount to their current value.

Albermarle

Presume he will be contributing to the M&S workplace pension scheme anyway.

Cisco001

DRS1 said:

Personally I have always thought of Sharesave as a no brainer.  You don't lose even if the share price plummets as you get your money back plus whatever the interest/bonus is on the savings contract.

Incidentally the M&S stuff seems to suggest that only your savings get spent on buying shares under the option - I thought you could also spend the interest/bonus to buy the shares.  They also don't say what the interest rate/bonus rate is and I would have thought that was something he'd want to know.

I suppose the other thing to think about is where does he see himself in 3 years time? 3 years is a long time to a 23 year old.

Of course a pension and an ISA are also good things to do and he should do all three but none of the pension nor ISA will let him buy shares at a discount to their current value.

Lifetime ISA if OP has not own property yet.

dunstonh

Wonka_2 said:

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

It would depend on the terms of the sharesave (i.e. how much the shares are discounted to current trading price).

However, from a tax point of view and retirement products included - given reference to pension in thread title), assumng the 23 year old is a basic rate taxpayer.....   LISA is best followed by a pension, followed by an S&S ISA.  

DRS1

dunstonh said:

Wonka_2 said:

DS is starting to get established in job and has received an offer to join M&S Sharesave

Assuming £100pm investment which of the above 3 would you put it in ? 

It would depend on the terms of the sharesave (i.e. how much the shares are discounted to current trading price).

However, from a tax point of view and retirement products included - given reference to pension in thread title), assumng the 23 year old is a basic rate taxpayer.....   LISA is best followed by a pension, followed by an S&S ISA.  

Option Price £3.15
Current Price £3.66
So not a 20% discount but the price has been going down so maybe it was once.