New to ISAs and no idea what I'm doing... £10k to invest

[Stopiwantotgetoff]

I've got together £10,000 that I'd like to put somewhere for a minimum 10 years, possibly longer.

I've been reading the threads on here and see that Vanguard sounds like a good place to put it. I've been recommended by a friend a FTSE Global or S&P500.

I just wanted to ask if that sounds like good advice? Obviously it's not enough to go to a financial advisor with so I'm a bit concerned I'm going to make a mistake with it. Happy to do my own research but it's not a subject I know anything about - money conversations just scare me as I've no idea what I'm doing. TIA

Look up Rebel Finance School on FB and YouTube…entirely free, and highly recommended.

It’s not bad at all- but do also take a looK at vanguard’s lifestrategy funds which contain bonds as well as equities - might give you a bit more diversification/stability.

Thank you. I'll take a look at the recommendations. I really need to learn how to manage money. So Vanguard would be a good place to have the money? I've got a HL account that I haven't actually really used but I did read here about their fees being a bit higher so probably good to move on from there.

A couple of years ago I got a new job with an international company that gives employees shares. I understand now about CGT but don't really understand what I should with dividends, and there is also around £3000 sitting in that account as cash. But I have don't whether it's a good idea to keep the shares there or to spread the risk but no idea how to do it. It's like a different language that I can't quite get a grasp on!

these are overweighted to the UK, having 25% in Uk rather than the 4% global waiting.

Vanguard have a minimum fee for anything lower than £32k held so can be expensive for smaller amounts of money. Invest Engine or Trading 212 both have minimal fees and are pretty easy to use.

The advice of going for a global index fund is going to be suitable for lots of people, but it is worth you getting up to speed with the basics. There are a few resources consistently touted which should help get you more comfortable with the jargon and fundamentals of investing.

• Rebel Finance School
• Meaningful Money
• Damien Talks Money
• PensionCraft

Ive literally just moved some money (£10k) from my cash isa into a S&S isa using trading 212s vanguard global pie. It selects a balanced mix for you. Mine is 50%Vanguard global aggregate bond, 33% FTSE North America and the rest in FTSE developed Europe, FTSE Emerging Markets, FTSE japan and FTSEDeveloped Asia pacific (excel japan). This is a ready made "pie" and so you literally click it and the decisions are all made for you. I think you then just have to let it sit there and don't look at it though since in the past hour I've made £7 and then lost £10 so I'm down already!

I needed to be less risk averse. I've used my full isa allowance for the past few years so had a lot sitting in a cash isa

Im now up £14. I need to not check it constantly since it will become addictive..

Honestly with 10k you're not going to be actively looking after the investment per se.

Choose a S&S ISA provider based on what matters to you, ease of use, tech, fees, investment options (ethically, non-uk etc..) Open the account, choose the investment strategy (most offer low, medium, and high risk type options under various names) and then walk away. Check it once a year to determine if it's working for you.

Unless finances and investments are an interest to you, let the provider do the work.

Ha! I’m just like you @bluebirdy3987 - it is addictive. Good luck for tomorrow!

did you want a pie with 50% bonds?

absolutely no idea. It's just a trading 212 ready made pie. It offers this one or Blackrock core.

Have I done the wrong thing? Im assuming if there are also bonds it's slightly lower risk? I'm 52 and at the moment most of the money is sitting in a cash isa.

literally zero idea what I'm doing..

Not wanting to sound mean, but you should educate yourself on the basics of investing, the risks and potential gains to determine whether any particular investment is right for you. Especially if you transferred £10k and say you don't understand what you are doing.

I'm not saying what you have done is wrong, I'm not in a position to do that.

Which firm manages the fund is kind of important, but provided it is a real company and not a scam, what is REALLY important is what sorts of investments are inside the fund you choose, what sorts of fees you pay. A brand like Vanguard used to be a guarantee of reasonable fees at least, but now they have launched into some "active" funds with fees that I personally think are too high. They also have a broad range of funds in terms of what investments are inside, some of which I would buy myself, and others of which I would not touch with a barge pole because they are concentrated into a niche area where I would not choose to invest.

I agree with all PPs who suggested to get yourself a minimum of financial education before investing in anything more racy than cash or short to medium term bonds.

I'm not about to start dabbling with anything racy. Thats precisely why I just put the money into a ready made pie which is probably overly cautious if anything. I know more about it this week than I did last week..

I'm fortunate in that I had £150k sitting in a cash isa so I've just switched some across and into the ready made pie. I can move it back very easily if I ever have to.

Thanks so much for all the comments, and for the posters who suggested Rebel Finance School. I've been listening to it on my commute and it's brilliant - I've a much better understanding already. I've done my spreadsheets for this financial year and feeling more in control.
Not yet opened the ISA, they do a 10 week series and I'm listening my way through that and then will open it.

I'll also listen to Pensioncraft as this is another area where I am lacking in confidence and knowledge - thanks for this!

Moving forward, I'm hoping to save £1000 - £1500 a month and prioritising this.

I don't know how to work out what's the best thing to do:
I'm a higher rate tax payer, aged 52

So I could:
Add to pension
Overpay on mortgage
Max out my ISA
Set up ISAs for children although the oldest is 14 so is 4 years long enough to invest?
Buy shares for the household name company I work at, at a discount. it's fairly stable and when you look at share prices over the last prices, they've always increased with small localised drops in price. Although I have been reading not to have all your shares in one company? I suppose you're only one bad decision/failure for the price to fall?

How would I work out what to prioritise? I haven't given figures as I don't want divulge all my financial info on a public website!

Have a look at https://ukpersonal.finance/ and their flow chart https://ukpersonal.finance/flowchart/

Rebel Finance School on YouTube /Facebook definitely what you need. Bonds not needed in a 10 year investment IMO - they explain this on the course 👍🏻

There is no right and wrong answer here, it's all based on your personal situation and priorities. Any or all or a combination of your options are liable to improve your financial position.

@RantingAnonymously shared a really useful flowchart to help with your thinking. I'd also advocate considering the following questions:

1. What are you saving for - e.g. house renovations vs emergency fund vs retirement?
2. When will you need it?
3. How accessible do you need it to be?
4. What is your appetite to risk?
5. What is your tax position now and what is it likely to be in the future?

And then you might need to look at some online calculators or spend some time on spreadsheets to look at the £ impact of various scenarios.

There are pros and cons to everything. Pension contributions are tax efficient as a HR taxpayer and you'll only have to wait another 5 years until you can access this. Your mortgage may be on a low rate but you could save into an ISA to pay off a chunk when it renews. Etc.

Starting is the hardest bit and I'm sure the resources you're looking into will help you feel more comfortable in your decision-making.

On the specific question re employee share schemes, ask for the details from your HR or Reward department. I assume it will be either SAYE or SIP but they do vary company to company. Some will give you matching shares in a SIP when you buy which makes them much more attractive. And SAYE may be over 3 or 5 years.

I do not know much about circumstances, and this is not financial advice, BUT
-in general, in my opinion at least, ISAs for children should only be a priority if you are trying to reduce the assets in your own name for some reason or if you have more money than you need even if you stop working soon.

-if your mortgage currently carries a lower interest rate than what you could earn on a cash ISA or a short to medium term gilt, then you can keep the difference by investing into an ISA instead of paying down the mortgage. If you then also make sure you choose ISA options so that this money will be accessible when the mortgage renewal date comes around, you can keep this difference while also keeping the future option to use it to reduce the mortgage if you do not like the mortgage rates that will be on offer when that date rolls around.

-if you do not need the money before the age at which you will be able to access your pension (I believe 55 if you turn 55 before April 6, 2028), then putting money into your SIPP (within the allowances) normally gets you higher rate tax relief right now, which seems very attractive relative to the other options

-In all cases, distinguish carefully between what you actually invest in (could be cash, short to medium gilts which are low risk, stocks and shares or long gilts which are higher risk but potentially higher return)., and what sort of "container" the investment goes into (could be a SIPP, an ISA, or a general investment account).

On junior ISAs: they only make sense if you max out your and your partner's ISA every year (that's £40k between the two of you) and if the gains on your taxable investment account are above the allowance. Not many families can save more than £40k every year...

For example, if you have a joint investment account with your partner, then the first £6k of capital gains are not taxed (£3k each). You could have £60k invested, make an 8% gain (£4,800), and it would still be tax-free (different rules for dividends and interest).

I think you really need to be in the top 1% before even thinking of a junior ISA.

PS to be clear, there is another reason it might make sense to put money in a junior ISA: when you want the money to be in your children's name, legally segregated from your assets, so that, if for whatever reason you get sued, your creditors cannot go after that money.

This will typically not be a consideration for salaried employees. Maybe for entrepreneurs and small business owners who gave personal guarantees.