registerme
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Post by registerme on Jan 13, 2018 12:47:43 GMT
1. I have the remnants of one ISA (cleared the bulk of it out back in 2004 when I needed the funds for a deposit on a house), and excess cash in the bank achieving nothing.
2. I'm currently paying almost nothing in tax, but that will change as I get funds invested outside of tax protected schemes like ISAs.
3. In a perfect world I would keep my powder dry and wait for the bottom to fall out of the equities markets - my current equity exposure is all via my various pensions.
What would you advise when it comes to how I should look at ISAs, and what I should look at / think about?
Cheers,
RM
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Post by dan1 on Jan 13, 2018 13:07:36 GMT
1. I have the remnants of one ISA (cleared the bulk of it out back in 2004 when I needed the funds for a deposit on a house), and excess cash in the bank achieving nothing. 2. I'm currently paying almost nothing in tax, but that will change as I get funds invested outside of tax protected schemes like ISAs. 3. In a perfect world I would keep my powder dry and wait for the bottom to fall out of the equities markets - my current equity exposure is all via my various pensions.
What would you advise when it comes to how I should look at ISAs, and what I should look at / think about? Cheers, RM I may be interpreting you incorrectly but I take it you are parking your cash while you wait for the next equity crash but would prefer to buy those equities within an ISA to protect against future capital gains and income tax? In the meantime you'd prefer not to let your ISA allowance go to waste (use it or lose it). If that's the case then I'd suggest you investigate flexible stocks & shares ISAs. I know The Share Centre operate one but expect they're not alone (Charles Stanley too, perhaps?). Dump your cash in to take advantage of your ISA allowance, take it straight out and invest elsewhere (taxable admittedly but as you're not paying tax then no loss) wherever you feel comfortable with liquidity in mind - guaranteed then stick it in high interest current accounts + accessible regular savers (or instant access savings if you can't be bothered with the faff, I don't blame you), or perhaps P2P with good liquidity (RS, FC,.... even ABL but with much greater risk to liquidity - not Z at this time due to their poor systems). Just remember to put it back before the end of the tax year and take it out again at the start of the next tax year. The thing about timing a crash is you can't wait for a flexible Cash ISA to transfer to a S&S ISA.
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bigfoot12
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Post by bigfoot12 on Jan 13, 2018 13:42:56 GMT
I have put this year's allowance into an ISA, kept most as cash, and put some into low risk low yielding investments. Will do the same again in April.
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macq
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Post by macq on Jan 13, 2018 13:43:21 GMT
Trying to time the downturn of the market is the hard bit.While most experts say there must be a correction they have been saying it for 3+ years over which you may have made 50% and the drop when it happens may only be 25% (but yes it could be more)But how do you time the bottom? you could think its there then invest & a month later it drops again.
It could be worth looking at so called wealth preservation funds that look to protect the capital & try to protect in a crash(the word being try) a multi asset fund that is a mix of gilts,bonds & equity or pick a big name IT paying dividends and in a crash move whats invested into funds you are interested in but in the mean time earn a bit more then cash
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agent69
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Post by agent69 on Jan 13, 2018 14:22:47 GMT
While most experts say there must be a correction Bitcoin, stock markets, P2P - many have predicted imminent doom and damnation. Question is when will it actually happen?
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macq
Member of DD Central
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Post by macq on Jan 13, 2018 14:30:20 GMT
While most experts say there must be a correction Bitcoin, stock markets, P2P - many have predicted imminent doom and damnation. Question is when will it actually happen? not when you expect 
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james100
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Post by james100 on Jan 14, 2018 15:54:14 GMT
What would you advise when it comes to how I should look at ISAs, and what I should look at / think about? Off the top of my head, I'd suggest these are good starting points: 1. Time horizon for investment (between input and expected output of any part of it) 2. Sensitivity to capital loss on a year to year basis (and what %) 3. Purpose eg dividend generation to supplement income stream, long term capital growth (or both) 4. Context: do you want this to serve as a stand-alone investment or as something else (eg stabilizer against GBP devaluation, or against an equity-heavy existing pension portfolio) 5. How much time you want to spend on managing it per annum 6. How comfortable & experienced you are with taking decisions related to the asset class (or composite asset classes) 7. Tax position (are you maxed out on your dividend allowance - about to reduce to 2Kpa, savings allowance, personal allowances, capital gains tax allowances?...how can you best use utilize your ISA allowance versus assets) 8. How much can you afford to lose % wise if you do indeed transfer into an equity market just before it crashes, and how long can you afford to wait for it to recover if you ride it out. There are many more things to think about, I'm sure. But if you're clear on all this (and with a realistic view on returns), then IMHO you can construct a workable ISA portfolio which should not cause too many sleepless nights.
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registerme
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Post by registerme on Jan 15, 2018 9:08:03 GMT
Thanks all for your thoughts  . |
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Post by GSV3MIaC on Jan 17, 2018 11:28:54 GMT
Late to the party but ..
I'd certainly make sure I squirrelled away the max £20k into SOME ISA each year, even if it sat there as cash earning very little .. on the assumption that one day you might get a decent return (tax free). But you do need to answer the Qs raised above - what are your goals and time horizon? Take a while to build a large enough S&S pot to worry about the CGT saving potential, unless you get lucky with investment choices .. and CGT is only really an issue if/when you cash out (and if you maximise your allowance usage each year, maybe not even then) .. but P2P interest could get you into taxable domain quite quickly. If you have P2P investments, and the platform has a flexible ISA option, then I'd cheerfully use it (although rotating out into S&S later could be difficult to time) - does depend on what tax you are likely to be paying though (crystal ball time).
There is also the risk that at some point HMG (or JC) will decide ISAs are costing too much tax loss, and re-write the whole deal (if interest rates were not near zero, that'd look more tempting). And then you die .. hopefully you've found a good use for it all before then.
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