Is My Isa Any Good? Help!

alesanamurphy

EXACTLY 9 YEARS AGO I STARTED UP A MAXI ISA WITH CIS PAYING IN £100 A MONTH.

9 YEARS ON THE CASH IN VALUE IS £13,723.

HAS THIS REPRESENTED A GOOD RETURN, OR SHOULD I BE SHIPPING SOME OF THE MONEY OUT INTO OTHER ACCOUNTS?

PLEASE HELP! THANKS GUYS

nicko33

I think that's an average of 5.214% each year, so it's not awful.

Aegis

I make it roughly 5% per year, which for a stocks and shares ISA is pretty rubbish even given the recent turbulence. While swapping out of stocks and shares would be a bad thing because it essentially admits defeat, it might be an idea to transfer it to a whole-of-market provider and stick it into some funds that will hopefully perform better than whet you currently have.

What did they recommend that you put your money in to, and have they ever reviewed your situation with you?

nicko33

Aegis wrote: »

I make it roughly 5% per year, which for a stocks and shares ISA is pretty rubbish even given the recent turbulence.

As you say, we don't know what it's invested in.
FTSE100 is down about 480 from it's April 1999 open of 6367
and the All-share about 40 up since Jan 2000

so should we be expecting much more than the market yield ? (if it were a tracker)

Aegis

Doing a quick search on Citywire, some of the Cautious managed funds have grown slower than this ISA. However, I believe that the majority of the Balanced funds outperform this, and a diversified portfolio looking in to UK Equities, bonds, etc would probably have outperformed this ISA.

OP, what fund(s) are held within your ISA?

alesanamurphy

When I took this out (I must point out I was young and naive at the time!), it was described as a CIS UK Growth Trust PEP.
They said my savings would be invested in 'good quality UK companies with excellent future prospects'.
Obviously it was converted into a Maxi ISA in 1999.
Other tan receiving statements, I have had zero contact from the CIS.

Aegis

So basically your entire investment has been into a single fund for 9 years? If so, that might be something you want to change at some point, as diversification is one of the keys to successful long-term investing through funds!

alesanamurphy

Thanks for all your help!

Where do I go from her though? Do I put my money into a better performing maxi Isa, or split it into a mini cash isa and other high interest savings?

What would you all do in my position?

Aegis

My own personal strategy would be to transfer the whole lot over to somewhere like Hargreaves Lansdown, at which point I'd start with a little research here and diversify out from where you currently are.

Once you're happy with a fund selection, you can easily purchase the right amount of each, and then you can leave it going. Let's face it, at the moment you're doing much the same, only with what probably amounts to a worse situation!

The other option would be to contact an IFA near you and asking if they can help you set up a better ISA for £100 per month. That way at least you know that you're getting funds from the whole of market!

Keybiz

Remember, If you compare the growth on the S+S ISA to a deposit based account i.e. bank or building society over the same period (less tax on these) then S+S almost always come out on top, albeit with some volatility along the way! As such, if you can beat high street returns and inflation and are prepared to invest over the long term then S+S ISA's make great sense.

As regards the CIS UK Growth trust, it does invest in solid uk companies i.e BP, Vodafone, Tesco all feature in the top ten holdings. It has performed at just above sector average over last 6months, 1 year and 3 years. And since launch in 1989 is ranked in first quartile. Alhtough not the top performer, it has deleivered decent results, so nothing to get too downhearted about.
As always, if picking new funds or diversifying, check the risk level of any investment and remember that past performance does not necessarily mean a good future.

Aegis

Keybiz wrote: »

Remember, If you compare the growth on the S+S ISA to a deposit based account i.e. bank or building society over the same period (less tax on these) then S+S almost always come out on top, albeit with some volatility along the way! As such, if you can beat high street returns and inflation and are prepared to invest over the long term then S+S ISA's make great sense.

As regards the CIS UK Growth trust, it does invest in solid uk companies i.e BP, Vodafone, Tesco all feature in the top ten holdings. It has performed at just above sector average over last 6months, 1 year and 3 years. And since launch in 1989 is ranked in first quartile. Alhtough not the top performer, it has deleivered decent results, so nothing to get too downhearted about.
As always, if picking new funds or diversifying, check the risk level of any investment and remember that past performance does not necessarily mean a good future.

Over a 10 year period, the CIS UK Growth trust ranks 76th out of 149. Far from top quartile. Over 5 years it manages to crawl up to 121st out of 249, which is still far from sterling performance. When you consider that in 10 years it's managed to get growth of about 38%, while the HSBC FTSE 250 tracker has managed over 100% growth for very much lower charges, you start to realise how bad this fund is compared to others in its sector.

To achieve the same growth over 10 years, you would only have needed 3.1% net.

Quite frankly, you'd have been much better off in a bank account than with all money in this fund, and you'd have been better still in a selection of decent funds spanning a couple of sectors. For example, the top quartile funds in the UK Equity Income sector almost all managed to double their investment values in the same period while not exposing investors to a much higher risk than the UK All Companies sector, if at all.

I stand by my suggestion that moving away from CIS would be an excellent idea, as they clearly can't match the big hitters except when it comes to their charges (moving to H-L would usually cost nothing initially and would achieve a rebate of some of the annual management charge too)