Investment advice
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thegentleway
Posts: 990 Forumite
Hi,
I'm 33 with £115k savings. I own and manage one student HMO and was saving up for another but don't feel like it's a good time to invest into student market where I live. I'm therefore looking to invest elsewhere. I'm thinking of putting a little bit into P2P and splitting the rest between stock market and a property company like VITA student !!!!! offer 7% NET assured rental. Hopefully this sounds like a sensible portfolio split.
For the stock market:
I have £20k in cash ISA, can this be transferred to S&S ISA? What are good platforms for someone interested in passive trackers? After the initial lump sum I'll be making monthly payments ~£1k.
Thanks for the help.
I'm 33 with £115k savings. I own and manage one student HMO and was saving up for another but don't feel like it's a good time to invest into student market where I live. I'm therefore looking to invest elsewhere. I'm thinking of putting a little bit into P2P and splitting the rest between stock market and a property company like VITA student !!!!! offer 7% NET assured rental. Hopefully this sounds like a sensible portfolio split.
For the stock market:
I have £20k in cash ISA, can this be transferred to S&S ISA? What are good platforms for someone interested in passive trackers? After the initial lump sum I'll be making monthly payments ~£1k.
Thanks for the help.
No one has ever become poor by giving
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Comments
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A cash ISA can easily be transferred to an S&S ISA. Just ask your chosen S&S platform to arrange a transfer-in. Dont withdraw the money yourself from your cash ISA - it will lose its ISA status
As to platforms, most of the ones discussed on this forum would be fine. There are differences in charges, facilities, and efficiency, but in the overall scheme of things the differences are relatively small.
I assume the £20K was from previous years contributions whereas the £1K/month will be new money in the current year. You are limited to £20K total new money/year ISA contributions.
Regarding your other plans, your investment in VITA sounds rather risky to me as it may well not be covered by the FSCS protection scheme. 7% "assured" sounds attractive but it cannot mean there is a guarantee. Many schemes with allegedly certain returns have failed to deliver the goods. If you really want to invest in such things I suggest you split your money amongst a number of them as you dont want to lose everything if the company were to go busrt.0 -
A cash ISA can easily be transferred to an S&S ISA. Just ask your chosen S&S platform to arrange a transfer-in. Dont withdraw the money yourself from your cash ISA - it will lose its ISA status
As to platforms, most of the ones discussed on this forum would be fine. There are differences in charges, facilities, and efficiency, but in the overall scheme of things the differences are relatively small.
I assume the £20K was from previous years contributions whereas the £1K/month will be new money in the current year. You are limited to £20K total new money/year ISA contributions.
Regarding your other plans, your investment in VITA sounds rather risky to me as it may well not be covered by the FSCS protection scheme. 7% "assured" sounds attractive but it cannot mean there is a guarantee. Many schemes with allegedly certain returns have failed to deliver the goods. If you really want to invest in such things I suggest you split your money amongst a number of them as you dont want to lose everything if the company were to go busrt.
Thanks Linton, that's good news about transferring previous cash ISAs (it is from previous contributions).
I've been looking into platforms but I'm a bit confused by charges. It seems flat fees would be more cost effective for me. It looks like there are 3 charges that would apply:
a. annual fee
b. dealing fee
c. regular investing fee
So for monthly investments I'm looking at a + 12 x (b + c) annual cost? Or does the regular investing fee including the dealing fee?
Understood about VITA, I don't really want to invest in such things, it just seemed like a good return. It also allows me to sell after 5 years, which would work well for me as I will probably be buying at house then. What 5 year investments would be less risky?No one has ever become poor by giving0 -
thegentleway wrote: »Thanks Linton, that's good news about transferring previous cash ISAs (it is from previous contributions).
I've been looking into platforms but I'm a bit confused by charges. It seems flat fees would be more cost effective for me. It looks like there are 3 charges that would apply:
a. annual fee
b. dealing fee
c. regular investing fee
So for monthly investments I'm looking at a + 12 x (b + c) annual cost? Or does the regular investing fee including the dealing fee?
It is b or c, not b and c. Some platforms have lower transaction charges if you invest frequently and regularly.
The issue isnt the timescale but rather the dependence on one single company. If you invest in funds you are probably investing in hundreds of separate companies. One going bust wont matter. With offers like VITA one going bust really does matter. The added risk is that offerings like VITA's are probably not regulated nearly as rigorously (if at all) as fund investments or cash deposits. So your chances of compensation should something go wrong are minimal.Understood about VITA, I don't really want to invest in such things, it just seemed like a good return. It also allows me to sell after 5 years, which would work well for me as I will probably be buying at house then. What 5 year investments would be less risky?
Its a general rule that the higher the return the higher the risk. If there was no risk VITA should have no problem getting money at less than 7% from the institutional investors.0 -
It is b or c, not b and c. Some platforms have lower transaction charges if you invest frequently and regularly.
Makes sense, thanks for explaining. Looking like Halifax Share Dealing works out the cheapest.The issue isnt the timescale but rather the dependence on one single company. If you invest in funds you are probably investing in hundreds of separate companies. One going bust wont matter. With offers like VITA one going bust really does matter. The added risk is that offerings like VITA's are probably not regulated nearly as rigorously (if at all) as fund investments or cash deposits. So your chances of compensation should something go wrong are minimal.
Its a general rule that the higher the return the higher the risk. If there was no risk VITA should have no problem getting money at less than 7% from the institutional investors.
Understood. I won't be investing in one single company but I'm a bit reluctant to put all my savings in funds as they are for long term investment and I will need access to some of my savings in ~5 years time.No one has ever become poor by giving0 -
I'm a bit surprised that at the amounts you are talking about a % fee broker isn't cheaper.
At say 0.25% on your £20k it would be £50 per year and if it was £32k at the start of the next year it would be £80 per year. Not totally accurate I know as the balance will be increasing gradually as you add your £1k per month and asset values will go up and down but OK as a ballpark.0 -
I'm a bit surprised that at the amounts you are talking about a % fee broker isn't cheaper.
At say 0.25% on your £20k it would be £50 per year and if it was £32k at the start of the next year it would be £80 per year. Not totally accurate I know as the balance will be increasing gradually as you add your £1k per month and asset values will go up and down but OK as a ballpark.
Halifax is £12.50 a year and £2 for regular investment so only £36.50 for a year with 12 monthly payments. What % of your savings have you got in funds?No one has ever become poor by giving0 -
thegentleway wrote: »Halifax is £12.50 a year and £2 for regular investment so only £36.50 for a year with 12 monthly payments. What % of your savings have you got in funds?
Thanks for that, hadn't realised they were so cheap.
Depends on how many funds are being purchased each month then I guess.
Sorry, don't understand your last point re % of savings in funds?0 -
Thanks for that, hadn't realised they were so cheap.
Depends on how many funds are being purchased each month then I guess.
Sorry, don't understand your last point re % of savings in funds?
Yes, they are super cheap! I'm a complete newb so probably going to stick to one, maybe two funds.
I was just wondering how much of their savings people put into funds.No one has ever become poor by giving0
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