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  • FIRST POST
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 8:03 PM
    • 328Posts
    • 53Thanks
    FIRSTTIMER
    Advice Please - Planning for Future - LISA AND ISA
    • #1
    • 11th Mar 18, 8:03 PM
    Advice Please - Planning for Future - LISA AND ISA 11th Mar 18 at 8:03 PM
    Hi,


    Currently 33 and I am planning my future savings and wanted some advice. I have approx. 10k in cash savings and also no debts. I am looking to save approx. 600 a month long term from the new tax year onwards. As I have cash savings to access if needs be, I am looking at doing the following instead for better growth....


    300 a month in a S&S LISA - long term investment that I will access at 60.
    300 a month into a normal S&S ISA - one that I can access immediately and withdraw if needs be.


    Has anyone any advice on both. I really want both products to be those funds/investment/features which have minimal fees and are managed on my behalf as I really haven't got the time to keep moving money monthly to keep maximising my returns - can anyone advice on the best options/products.


    I have been looking at AJ Bell/Charles Stanley and Cavendish/HL - but could do with some MoneysavingExpert input!!
    Savings 10000
Page 1
    • Alistair31
    • By Alistair31 11th Mar 18, 9:10 PM
    • 35 Posts
    • 26 Thanks
    Alistair31
    • #2
    • 11th Mar 18, 9:10 PM
    • #2
    • 11th Mar 18, 9:10 PM
    What is your pension situation ?
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 9:24 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    • #3
    • 11th Mar 18, 9:24 PM
    • #3
    • 11th Mar 18, 9:24 PM
    Company pension. Defined benefit. Retiring around 60-65 I reckon.
    Savings 10000
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 9:25 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    • #4
    • 11th Mar 18, 9:25 PM
    • #4
    • 11th Mar 18, 9:25 PM
    From researching this evening....and the FCS Protection Rules.


    I am thinking MoneyFarm for one of them and Nutmeg for the other....
    Savings 10000
    • ValiantSon
    • By ValiantSon 11th Mar 18, 9:26 PM
    • 2,013 Posts
    • 1,863 Thanks
    ValiantSon
    • #5
    • 11th Mar 18, 9:26 PM
    • #5
    • 11th Mar 18, 9:26 PM
    Hi,


    Currently 33 and I am planning my future savings and wanted some advice. I have approx. 10k in cash savings and also no debts. I am looking to save approx. 600 a month long term from the new tax year onwards. As I have cash savings to access if needs be, I am looking at doing the following instead for better growth....


    300 a month in a S&S LISA - long term investment that I will access at 60.
    300 a month into a normal S&S ISA - one that I can access immediately and withdraw if needs be.


    Has anyone any advice on both. I really want both products to be those funds/investment/features which have minimal fees and are managed on my behalf as I really haven't got the time to keep moving money monthly to keep maximising my returns - can anyone advice on the best options/products.


    I have been looking at AJ Bell/Charles Stanley and Cavendish/HL - but could do with some MoneysavingExpert input!!
    Originally posted by FIRSTTIMER
    You shouldn't be looking at an S&S investment as money that you can draw on in any kind of short term timeframe. That is what your cash holdings are for, and at 10,000 they seem quite healthy.

    Assuming you have a pension into which you are putting a sizeable sum of money, e.g. at least 15% of salary as a combined contribution from you and your employer, then making use of a LISA for additional pension is not a bad idea, given the 25% bonus. At 300 per month you are just short of the maximum LISA contribution, so I'd up the LISA contribution to the maximum and take advantage of the maximum bonus.

    Rather than look at platforms in the first instance, it would be more sensible to identify the funds that you wish to invest in and then look at where you can get get them for the cheapest price. Have you considered what those funds might be?
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 9:35 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    • #6
    • 11th Mar 18, 9:35 PM
    • #6
    • 11th Mar 18, 9:35 PM
    Hi,


    Thanks for this - I am contemplating splitting the 600 into more into the LISA and then the rest into a S&S ISA. I agree around the withdrawal, however I mean in an absolute emergency situation.


    In terms of fund - this is the issue - I am non the wiser, I am ideally looking for the cheapest fully managed multi fund with the least charges and one that doesn't charge for monthly deposits/emergency withdrawal/transactions but also gives the best return. Hence why googling Nutmeg and Moneyfarm seem to come up as the best fully managed with minimal costs?
    Savings 10000
    • ValiantSon
    • By ValiantSon 11th Mar 18, 9:48 PM
    • 2,013 Posts
    • 1,863 Thanks
    ValiantSon
    • #7
    • 11th Mar 18, 9:48 PM
    • #7
    • 11th Mar 18, 9:48 PM
    Hi,


    Thanks for this - I am contemplating splitting the 600 into more into the LISA and then the rest into a S&S ISA. I agree around the withdrawal, however I mean in an absolute emergency situation.


    In terms of fund - this is the issue - I am non the wiser, I am ideally looking for the cheapest fully managed multi fund with the least charges and one that doesn't charge for monthly deposits/emergency withdrawal/transactions but also gives the best return. Hence why googling Nutmeg and Moneyfarm seem to come up as the best fully managed with minimal costs?
    Originally posted by FIRSTTIMER
    Nutmeg and Moneyfarm are quite expensive compared to a multi-asset fund (like Vanguard LifeStrategy, HSBC Global Strategy, Blackrock Consensus or L&G Multi Index) held on a different platform. Have a read of the information about these different funds and then post back with any questions about them.
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 10:00 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    • #8
    • 11th Mar 18, 10:00 PM
    • #8
    • 11th Mar 18, 10:00 PM
    I was actually looking at Vangaurd 60 but couldn't quite determine the costs associated and the potential growth performance. I do not want to have to pay as a regular saver. Although the 0.3% annual costs seem MUCH cheaper than the Nutmeg/MoneyFarm that I had looked at.
    Savings 10000
    • Lungboy
    • By Lungboy 11th Mar 18, 10:16 PM
    • 1,405 Posts
    • 1,346 Thanks
    Lungboy
    • #9
    • 11th Mar 18, 10:16 PM
    • #9
    • 11th Mar 18, 10:16 PM
    I think the cheapest you can get Vls60 is on Vanguards own ISA and it's total cost is 0.37% (0.22% for the fund and 0.15% for the platform).
    • ValiantSon
    • By ValiantSon 11th Mar 18, 10:19 PM
    • 2,013 Posts
    • 1,863 Thanks
    ValiantSon
    I was actually looking at Vangaurd 60 but couldn't quite determine the costs associated and the potential growth performance. I do not want to have to pay as a regular saver. Although the 0.3% annual costs seem MUCH cheaper than the Nutmeg/MoneyFarm that I had looked at.
    Originally posted by FIRSTTIMER
    The costs partly depend on the platform that you use. For a LISA your choices are limited to AJ Bell (who charge 0.25%, plus 1.50 every time you buy or sell) or Hargreaves Lansdown (who charge 0.45%). Add those charges to the Vanguard fund charges and you have your total cost. Be aware, however, that the fund charges are simply factored into the values, so you will only ever make an actual payment for the platform fees. Making monthly deposits would add 18 a year to the AJ Bell charges, so HL may be a better option, but you'd need to do the sums to be sure.

    For an ISA, the cheapest way to hold Vanguard funds is through their own platform: Vanguard Investor. They only charge 0.15% on top of the fund charge with no other charges.
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 10:24 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    The LISA costs are therefore looking at around 0.6-0.75 total cost same as nutmeg and moneyfarm


    Vangaurd is looking at 0.15 plus 0.22 for the S&S ISA
    Savings 10000
    • TheShape
    • By TheShape 11th Mar 18, 10:44 PM
    • 1,293 Posts
    • 1,103 Thanks
    TheShape
    Not advice but my experience. I have my S&S LISA with HL. I chose HL as I preferred a platform with no dealing costs for funds unlike AJ Bell and I preferred to pay fees outside the LISA by setting up a seperate HL Fund & Share account from which I pay the fees. I was also happy with the reduced fees that HL have on the Blackrock Consensus 100 fund (fees also reduced on Blackrock Consensus 85) which I also invest in through my S&S ISA.
    • FIRSTTIMER
    • By FIRSTTIMER 11th Mar 18, 10:51 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    Thanks for that advice....I am thinking of Vangaurd SSISA Lifestrategy 60 - works out cheapest and the returns seem to have been favourable....


    LISA I will still investigate
    Savings 10000
    • Alexland
    • By Alexland 12th Mar 18, 8:04 AM
    • 2,571 Posts
    • 1,953 Thanks
    Alexland
    LISA I will still investigate
    Originally posted by FIRSTTIMER
    Moneyfarm don't do LISAs and, like Nutmeg, are a loss making company. I think it's more likely that Nutmeg will succeed than Moneyfarm. Still it depends on how much the backers are willing to keep burning money in the hope of getting to a break even point. If either did go bust (and the accounts were not transferred to a competitor) then claiming on the FSCS compensation would be a pain so take regular printouts.

    Still the experience and investment quality at Nutmeg is simple and high quality. I am not a fan of the Moneyfarm investment ETF mix which seems overly complicated for no real benefit. We have closed our Moneyfarm accounts.

    My view is that AJ Bell and HL offer the most attractive S&S LISAs and the choice depends on how regularly you are going to trade. HL are good for regular contributions and, as TheShape mentioned, if you are happy to go for a very volatile investment (ie a chance of 40% to 50% drops) for the chance of higher gains HL have secured very good discounts on the Blackrock Consensus 85 and 100 funds.

    Ours are with Nutmeg and I will be moving them to HL and investing in Blackrock when they next offer an incentive to transfer. I take the most volatility in ISA/LISAs (as the growth will be untaxed) and run the pensions at lower risk (to avoid hitting lifetime allowance issues)

    Alex.
    Last edited by Alexland; 12-03-2018 at 8:30 AM.
    • Lungboy
    • By Lungboy 12th Mar 18, 9:13 AM
    • 1,405 Posts
    • 1,346 Thanks
    Lungboy
    I take the most volatility in ISA/LISAs (as the growth will be untaxed) and run the pensions at lower risk (to avoid hitting lifetime allowance issues)
    Originally posted by Alexland
    Interesting. Is this the more usual way to do it or your own approach? To me (as an utter novice) the opposite makes sense as pensions are presumably for the longer term and can therefore afford to be a bit more risky. I'm never going to run into lifetime allowance issues though.
    • Alexland
    • By Alexland 12th Mar 18, 9:36 AM
    • 2,571 Posts
    • 1,953 Thanks
    Alexland
    It's probably not normal but it's what I do. I have already used 1/4 of the LTA in my 30s (and expect 1/3 of the CPI uplifted LTA by my 40th birthday) so I don't want too much growth in my pensions. Am happy if it only grows by a couple of percent above inflation. Would prefer the volatility and growth elsewhere. The ISAs will be invested for decades anyway.

    Still if the markets dropped enough then I would be tempted to increase the equities in my pensions to take advantage of the recovery.
    Last edited by Alexland; 12-03-2018 at 10:08 AM.
    • FIRSTTIMER
    • By FIRSTTIMER 12th Mar 18, 2:46 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    Thanks for all this.

    I am going to pluck for vanguard invester with vanguard lifestyle 60 managed fund paying in say 250 a month for a the next 5-10 years. Is this a good fund to leave once set up and it should manage itself?

    I will then set up a lisa s&s with HL before the end of the next tax year once i!!!8217;ve had my vanguard a year or so.

    Can anyone advice on safety - is either company or product likely to fold?

    Should I be watching for my investments to not go over the 50k value for protection purposes and if they do, open another product with another company? Or is this the wrong mentality. I ideally want two products that will do well, I dont have to touch and can access around aged 55-60.

    Thanks
    Savings 10000
    • Alexland
    • By Alexland 12th Mar 18, 5:30 PM
    • 2,571 Posts
    • 1,953 Thanks
    Alexland
    Vanguard are one of the world's largest fund managers and HL is the biggest DIY platform in the UK. They are about as safe as you get.

    There are enough companies in the industry that you don't need to take the risk unless there is a fees advantage in which case use your judgement about what proportion of your overall wealth you are risking.

    Alex
    • FIRSTTIMER
    • By FIRSTTIMER 12th Mar 18, 6:28 PM
    • 328 Posts
    • 53 Thanks
    FIRSTTIMER
    Great. Thats good to know.

    I am hoping 250 a month in a S&S ISA (vangaurd lifestyle 60) will pay out a decent sum circa age 55 (so about a 20 year investment from now)

    Same with S&S Lisa at age 60 saving 4k a year from next year. Apart from them two, I will have 10k cash to fall back on and also company pension and have a propery already, ideally looking to wind down at 55 really! Heres to hoping.
    Savings 10000
    • ValiantSon
    • By ValiantSon 12th Mar 18, 6:33 PM
    • 2,013 Posts
    • 1,863 Thanks
    ValiantSon
    Thanks for all this.

    I am going to pluck for vanguard invester with vanguard lifestyle 60 managed fund paying in say 250 a month for a the next 5-10 years. Is this a good fund to leave once set up and it should manage itself?

    I will then set up a lisa s&s with HL before the end of the next tax year once i!!!8217;ve had my vanguard a year or so.
    Originally posted by FIRSTTIMER
    Are you waiting a year because you don't have the money to invest in the LISA yet? If not then why wait? Waiting means you're missing out on free money from the government, in the form of the 25% bonus.

    Can anyone advice on safety - is either company or product likely to fold?
    Originally posted by FIRSTTIMER
    As Alex says, you're opting for two of the biggest and most established companies in the market. The chances of them going bust are very slim.

    Should I be watching for my investments to not go over the 50k value for protection purposes and if they do, open another product with another company? Or is this the wrong mentality. I ideally want two products that will do well, I dont have to touch and can access around aged 55-60.

    Thanks
    Originally posted by FIRSTTIMER
    Personally, I'm not worried about exceeding the 50,000 limit. The compensation scheme is only really relevant in instances of corporate fraud or gross negligence. The chances of this are incredibly small. However, if it makes you more comfortable then once you approach 50,000 opt for different investments (but that will be quite a way off yet!).
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