I have some money, what would you do?

McClane54

Hello All,

I have 15k savings just sitting in my bank (not much I know) but I want to start looking into ISA's, savings account to get as much as I can. Looking to leave it for 5-10 years . What would be the best way to make that money grow?

Thank you

Linton

The best way to make the money grow over a long period is to invest in equity (shares) funds. Their downside is that they will be volatile with prices rising and falling, occasionally by large amounts, over time. So you need to plan to hold them for 10 years to gain from the general upward trend without the risk you have to sell shortly after suffering an early major fall.

For 5 years or less you are probably talking about cash savings.

5-10 years is therefore a bit of an awkward time frame. Could you want to take all the money in 10 years? If not you could split your savings between an equity fund and fixed rate savings.

Baldytyke88

The best way to make the money grow is to put it into a pension and get the 20%/40% pension tax relief; then invest it in the stock market.

If you paid the money into a pension directly from your wages, you would also save by not paying National Insurance.

Eco_Miser

https://forums.moneysavingexpert.com/discussion/comment/82148370#Comment_82148370

That's useless if you want the money before you reach 57, or whatever age the government have set by the time you get there.

Also pension is taxable on the way out, so you're relying on paying less tax then than you save now, otherwise using an ISA gets exactly the same growth, and can be accessed anytime. It's certainly not a 20%/40% boost to your wealth.

sheenas

Ideally you should have an emergency fund. I have 3 months wages set aside. Pensions can be tax efficient, but accessing the funds is restricted. You could setup a sipp and invest or invest directly to grow your fund above the rate of inflation.

MEM62

If you paid the money into a pension directly from your wages, you would also save by not paying National Insurance

Only if you are paying via a salary sacrifice scheme.

@McClane54 The best way to maximise long term growth is through investment, not savings. This can be done within an ISA in order to keep the gains away from the Tax Man.

Albermarle

For savings ( not investments) suggest you read through this.

Savings | MoneySavingExpert

Baldytyke88

https://forums.moneysavingexpert.com/discussion/comment/82148382#Comment_82148382

The OP doesn't say how old he/she is, many people with money to invest are older.

If you are a basic-rate taxpayer who remains a basic-rate taxpayer in retirement, you do end up 6.25% better off due to the 25% tax-free lump sum.

Eco_Miser

https://forums.moneysavingexpert.com/discussion/comment/82148772#Comment_82148772

And some are not, and you didn't give any warning that pensions are not accessible before a certain age. Abolition or reduction of the tax-free sum has been mentioned as a possible action for a cash-strapped chancellor.

Sam_666

With £15k, its pointless looking in investing.
Best focus on high rate paying savings accounts. If taxpayer, stash it in ISA.
Pension is another option, but no data provided to make meaningful comment.

InvesterJones

https://forums.moneysavingexpert.com/discussion/comment/82148962#Comment_82148962

With £15k, its pointless looking in investing.

Why?

Pension is another option

Invested in what in the pension?