What are your thoughts on legal and general Shares and Stocks ISA

[Bellasara121]

Hi I am by no where rich and just scrap by I’ve been looking into private pensions and the stock and shares investments to try and create some money for later life and for my family. What are your thoughts on them are they safe? Or will I just lose anything I put in? I have looked at premium bonds but have no where the money for that. I looked at the stocks and shares since you can start an account with £20. I was looking to invest in something little and often and try and make a small return. I do not want to go down gambling ect I’m trying to look for a safest route and small chance of losing what I put in.

Ok, I’m not an expert but you seem to be asking a couple of questions a here. First what is you risk appetite? Premium bonds are considered really really safe as to not get your money back the British government would have to fail. A stocks and shares ISA might be safe you you only have bonds in it (not sure if that’s possible for legal and general) or it might be risky.

An ISA itself is not the product it just a wrapper that means your gains are tax free, you might by something that very risky like unknown (as it No reputation) stocks or something with a better track record like a units in a tracker fund.

First question to answer is what is your risk appetite. Second it what investments would fit that risk then start looking at what legal and general offers within those investments and how much the annual charges are.

Sorry if that’s a little confused. I’m in a rush.

L&G have some low cost funds like UK Index and International Index.

No idea what they are like as a platform provider. I would look at what the fees are.
Hargreaves Lansdown provides access to L&G index funds, and have a £25 per month minimum, with 0.45% fee plus the fund fee.

I would suggest you do some reading/listening to understand more about investing... platforms and funds.

Podcast:
meaningfulmoney.tv/UG4
That could be one to start with, and then go from there.

You can start premium bonds with £25 if you don't want risk. So not sure what you mean about not having the money for them if you want to start saving?

Yes, with PB's you only ever have to top up with £25 minimum. Main downside is that your money won't grow with interest and inflation will reduce it's value. Upside is, you might win a prize.

I invest in L&G Future World ESG Developed Index with a S&S ISA in HL. Rate of return has been okay(ish) during a year or so of crappy returns in the market more generally.

If you want to invest in a low cost fund and to play it relatively safe but with a decent level of return, look at Vanguard, something like their FTSE Global All Cap fund.

Be prepared to play the long game too, it's how you'll get the most return through compounding. Agree with PP about Meaningful Money podcast - it will really help you cut through a lot of confusion.

Thank you so much everyone for replying I am taking my time reading through them. What I originally thought is you have to have at least £2000 to save with PB.

The disadvantage with Premium Bonds is that unless you have a win, they earn no interest. You put £1000 in for 5 years, you get £1000 out at the end. High inflation will mean your money will be worth less in spending power over time. Also there's been some recent difficulties in holders accessing their online accounts after the introduction of 2-factor ID.

A savings account with a UK authorised bank or building society is equally safe and guaranteed by the UK government via the Financial Services Compensation Scheme, up to savings of £85,000.

The advantage of a savings account is that it earns compound interest.
So suppose the savings account offered 4% interest. You put it in for 5 years:
Year 1= £1040; Year 2 =£1080.16; Year 3 = £1120.49; Year 4 = £1160.99
Year 5 = £1210.67

So Premium Bonds after 5 years =still £1,000
Savings account at 4% interest = £1,210.67

Have a look at the first direct regular saver - 7% interest and safer than stocks and shares.

I do a lot of stocks and shares but it's not for you if you don't have a lot and can't risk it

Just a quick message to say that Premium Bonds are NOT safe. Unless you have pretty much the full allotment of £50,000 the chances of you winning anything is extremely unlikely. Due to inflation, as soon as you "invest", and I use that word loosely, in Premium Bonds then you are losing money. Premium Bonds are for the financially illiterate. Conversely, you will not go far wrong with the likes of Legal and General, Phoenix etc. The risk there is low and the dividends better than most.

As Einstein said, compound interest is the most powerful force in the universe. If you do invest in shares, be wary of the transaction costs and "stamp duty" (also the ISA running costs. If you are going to be investing small amounts over a long period of time, don't use an ISA or SIPP. The account maintenance costs will kill your growth. An ordinary share account will suffice. Many online share brokers will have a monthly subscription scheme where the invested amount is automatically processed and the charges are peanuts. I would recommend this type of service.

That said, I am not a financial adviser but do run my own ISA and SIPP for a number of years now. Do your own research and don't trust grown ups when it comes to all things money.

Hope this helps.