Legal & General distribution bond

Fairwinds

dunstonh wrote: »

There is nothing wrong with the fund and it will zig zag in value. Always has, always will. However, if you accept that and want to continue then you should still cash it in and re-buy the investment in ISA and unit trust form to save on the tax.

How easy is it to cash it in and reinvest in the ISA wrapper - I believe they may have used their cash allowances, so am I right in thinking that that reduces the amount they can invest each year.

Would that also mean that they would incur future withdrawal penalties over the next 5 years as the existing one did - 7% encash in 1 year down to 2% after 5years.

Thanks as always for your help

dunstonh

How easy is it to cash it in and reinvest in the ISA wrapper

As they are no longer in the first 5 years very easy. A request for full surrender and then a repurchase from HL if they want to go DIY (no intial charge and small saving on the AMC).

I believe they may have used their cash allowances, so am I right in thinking that that reduces the amount they can invest each year.

If they have in full, then they still have £3600 each available to S&S ISA. Just about enough time to catch this tax year as well if they are quick.

Would that also mean that they would incur future withdrawal penalties over the next 5 years as the existing one did - 7% encash in 1 year down to 2% after 5years.

No. Unit trusts (in and out of an ISA) have no tie in period. They are open ended and can be drawn without penalty after 2 months, 2 years or 20 years.