How to invest as a beginner

[littlematchstickgirl]

Serious lack of knowledge here, which I am now trying to correct. Reading lots of threads, but it's all a lot of information to take in!

I have a mortgage, but no other debts. I want to start saving into some kind of investment - I've been reading about Vanguard Lifestyle products and think this may be a good way to start. Is that an ISA? There is so much information that I'm easily confused. I don't have an ISA right now, only some easy-access savings for an emergency.

I want to save £100 per month for bonds/stocks&shares - reasonable risk.

Is this a sensible thing to do, bearing in mind I am a novice and don't know what I'm doing? Thank you in advance for advice.

An ISA is just a wrapper which ensures you won't have to pay tax on gains.

Vanguard is good, though, if your investment horizon is more than 10 years I'd go for a straightforward index tracker.

Check out the Vanguard website which has lot a of information about investing.

I use Vanguard, moved a rotten pension into it, add now every month from wages and employer tops up.
Think you can have lots of different products with them, mainly they are very good because of low fees
Husband has vanguard and still keeps a Hagreaves shares pot going.
If you know bugger all about playing the stock market , use Vanguard cause they do all he thinking,

PPs are good. I just wanted to recommend a podcast and/or a book.

The meaningful money podcast is amazing and there is an ultimate guide season that Pete did. Season 18 episode 4 & 5 (406 & 407 on castbox) is the investing ones and it will give you a good basic knowledge of what you are doing.

"How to own the world" by Andrew Craig was the catalyst for me to start investing. Just don't bother with his website or the fund he recommends on there as it isnt great.

Vanguards lifestyle products are brilliant for passive investing and their platform is good for the fees they charge.

Yes, start by using a fund like Vanguard LifeStrategy 80% equity, that way you will see how a fund like that performs. Bonds these days may smooth out dips a little but they seem to behave a lot like equities.

Paying in monthly will get you in the habit of putting the money in, you can set it up to automatically invest in your chosen fund.

Be prepared for there to be drops and increases... it is a rollercoaster ride, the key thing is to keep adding and not selling. This is a very long term play, so aim to not touch the money for 10+ years.

You may want a higher emergency fund if you feel you are likely to need money short term.

Thank you all - valuable advice! I'm going to take time to digest that and read up more, as recommended.

Another question - should I be directing that £100 into my workplace pension as an AVC, as I think that gives me a tax benefit, whereas the ISA will not?

Thank you

There's no one right answer to this. Paying more into your pension gets you tax relief now, but you will pay tax on it coming out (subject to your 25% tax free, personal allowance etc) and you're tying it up until retirement. Paying into an ISA gets no relief going in but is then tax free. You're not tying the money up as you would in a pension but, practically, a S&S ISA is only a good idea if you're happy not to touch it for 5 years or so.

Great advice here re pensions and ISA's. Regardless of which you choose the investment principles will be similar.

Buy a copy of Smarter Investing by Tim Hale. It's a great introduction.

Welcome falls in the stock market - it will mean that your £100 is buying even more shares the next month.

Keep trading costs and admin costs as low as possible. They can be a severe drag on your wealth

There are pros and cons to ISA vs Pension.
Pension gets tax relief,but is not really accessible.
ISA is accessible.
There may be stages of your life where you tip the balance one way or the other, so doing a bit more to ISA than Pension, then doing more to Pension than ISA.

I prefer having money accessible as I work part time and I have no intention of working in to my 60's. So I need money I can access before pension age.

@nannynick - thank you so much for that video! He explains it in an easy to understand way, I'm going to watch his other ones soon too.

Thanks to everyone else too - your advice is invaluable. I should have sorted myself out before now, but better late than never!!