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S&S ISA versus High Interest Savings Account
smilingfish
Posts: 2 Newbie
My fiance is looking to save a regular though initially, relatively small amount (£100) every month after putting her £3600 allowance into a cash ISA. She took some financial advice from an advisor who suggested putting the money into a Skandia MultiISA fund.
Looking at the key facts a 4.5% initial charge will be taken and the projection states that if the fund were to grow at 7.0% the total charges and expenses would have the effect of reducing the growth to 3.9%.
Given that she is a low rate tax payer and that she can get 6.5%+ interest rate with a regular savings account surely the fund would have to perform significantly better than the 7.0% (ie. into double figures) to beat the savings account by any noticeable amount. Is this kind of return what we should actually be looking for from an S&S ISA?
As a result of these large intial charges can anyone give me good reasons to opt for the ISA fund rather than a decent, possibly fixed rate, savings account?
Any thoughts appreciated!
Looking at the key facts a 4.5% initial charge will be taken and the projection states that if the fund were to grow at 7.0% the total charges and expenses would have the effect of reducing the growth to 3.9%.
Given that she is a low rate tax payer and that she can get 6.5%+ interest rate with a regular savings account surely the fund would have to perform significantly better than the 7.0% (ie. into double figures) to beat the savings account by any noticeable amount. Is this kind of return what we should actually be looking for from an S&S ISA?
As a result of these large intial charges can anyone give me good reasons to opt for the ISA fund rather than a decent, possibly fixed rate, savings account?
Any thoughts appreciated!
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