Where to put £500/month

Where to put £500/month

Author
Discussion

HughS47

Original Poster:

571 posts

133 months

Friday 24th February 2017
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Financial noob here.

I'm looking to invest £500/month. I know nothing about investments, but I do already have an ISA that I'm using for personal savings.

I'm thinking of:
1) £250/month - Foreign & Colonial Investment Trust
2) £250/month - Berry Brothers & Rudd Investment Cellar Plan (I like this idea - diversify the portfolio/add eccentricity)

Is this a sensible place to start? I know nothing of risk etc, other than I don't want to see my money evaporate overnight, but would like to save enough to perhaps treat myself to a Lotus Exige when I'm 55-60yrs old. I'm 32.

Any ideas??

Ginge R

4,761 posts

218 months

Friday 24th February 2017
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Hi Hugh,

If the funds you've mentioned are the engines, what's the best body? An estate (a pension), an investment ISA (sporty little coupe) or something else.. possibly building up a cash reserve, maybe? Maybe a blend of all three. Then, how much risk can you afford to take.. how much do you want to take? If you don't need to take much risk or need to make too too much to buy the Exige, then why take risk when you don't need to?

HughS47

Original Poster:

571 posts

133 months

Friday 24th February 2017
quotequote all
Risk needs to be low/medium - I don't need the funds to do anything dramatic, just be a sensible growth on the amount put down for the future. Pension is covered by my job (NHS) and I'm hoping to put away small amounts of cash ontop of this. This is simply an idea of where to put £500 that means I can almost forget about it until the time is right so to speak.

Zetec-S

5,832 posts

92 months

Friday 24th February 2017
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Is the £500 a month something you can commit to over a long period of time?

If so, how about a buy-to-let flat?

bobclayton

126 posts

105 months

Friday 24th February 2017
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Hugh - your timeframe will be a big teller in where you invest - riskier products require more time horizon!

Feel free to pop me a msg - what you're looking to do is my bread and butter smile

Xaero

4,060 posts

214 months

Friday 24th February 2017
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I put a lower amount monthly into a Fundsmith ISA, its up around 9% on what I've put in over the past year. I guess it's medium risk but the fund has only really gone up except for 1 month.

ellroy

7,005 posts

224 months

Friday 24th February 2017
quotequote all
Wine is no where close to being a med-low risk holding. It's out and out speculative.

As has been said timescale is the trump card.

When and what do you need the funds for?

For example, long term, but with some accessibility? ISA and equity is not a bad place to start. Long term, but no need for access until retirement? Pensions are potentially a more attractive option.

If you don't want to pay fees, which are worth it if you're a novice, for advice then those two main questions will at least give you some sense of where to start.

Edited by ellroy on Saturday 25th February 09:09

rsbmw

3,464 posts

104 months

Saturday 25th February 2017
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You're the second person this week to mention that wine plan, was it touted in a motley fool email or something?

As a new investor, throwing 50% of your saving into that doesn't sound in any way sensible. Doesn't mean it won't pay off, but you may as well stick the same amount of money on red or black each month!

Take a look at Vanguard lifestrategy in an ISA with someone like Charles Stanley Direct or Hargreaves Lansdown

Edited by rsbmw on Saturday 25th February 07:12

grahamm

211 posts

201 months

Saturday 25th February 2017
quotequote all
Xaero said:
I put a lower amount monthly into a Fundsmith ISA, its up around 9% on what I've put in over the past year. I guess it's medium risk but the fund has only really gone up except for 1 month.
I have been doing this for a few years now and am very pleased so far

Liggle

280 posts

100 months

Saturday 25th February 2017
quotequote all
rsbmw said:
Take a look at Vanguard lifestrategy in an ISA with someone like Charles Stanley Direct or Hargreaves Lansdown

Edited by rsbmw on Saturday 25th February 07:12
This, and you can choose the % of equities to suit your attitude to risk

I spread my monthly "surplus I could afford to lose" money across a Vanguard Lifestrategy 100% Equity and a Legal & General US Index fund, low fees and its on auto-pilot with Hargreaves Lansdown so I don't even have to think about it.

HughS47

Original Poster:

571 posts

133 months

Saturday 25th February 2017
quotequote all
Some really useful ideas here regarding different funds to look at - I'll have a look over the next few weeks and explore my options. The last couple of posts in particular have been helpful, so thank you!
Perhaps I need to take financial advice on my pension, as I really don't understand it other than being told it's an ok pension to pay into.
Regarding the wine scheme - I'll explore the other options over this, but for the uninitiated, we're not talking £10 a bottle and a stab in the dark, rather £1600 a half case (6) with proven second hand market history from the big producers - Latour, Margaux etc. Still doesn't remove the risk however!!
Thanks for all the advice!

toastyhamster

1,660 posts

95 months

Saturday 25th February 2017
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Anybody use an IFA or think they charge too much? Some good ideas here.

PhantomPH

4,043 posts

224 months

Saturday 25th February 2017
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number2

4,267 posts

186 months

Sunday 26th February 2017
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If you're looking to invest across multiple funds, Fidelity has some of the lowest ISA wrapper charges at the moment at 0.25% p.a.

www.fidelity.co.uk

Jimmy Recard

17,540 posts

178 months

Sunday 26th February 2017
quotequote all
grahamm said:
Xaero said:
I put a lower amount monthly into a Fundsmith ISA, its up around 9% on what I've put in over the past year. I guess it's medium risk but the fund has only really gone up except for 1 month.
I have been doing this for a few years now and am very pleased so far
Is there any chance you could tell me a little about this?

I have been thinking of opening one to pay in around £300 per month. Is it instant access? Are there penalties for not maintaining regular payments?

benjijames28

1,702 posts

91 months

Sunday 26th February 2017
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Jimmy Recard said:
Is there any chance you could tell me a little about this?

I have been thinking of opening one to pay in around £300 per month. Is it instant access? Are there penalties for not maintaining regular payments?
I'm interested in these too, might only be looking at 150 a month tho.

bogie

16,342 posts

271 months

Sunday 26th February 2017
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HughS47

Original Poster:

571 posts

133 months

Monday 27th February 2017
quotequote all
Not entirely sure I'm following anymore - If I already have an ISA, I though I'm not allowed a second, so where does that leave me with the fundsmith stuff etc? What sort of other products are out there that offer a fire-and-forget monthly d.debit type investment opportunity in the markets? bear in mind you're dealing with a complete financial beginner here...

PhantomPH

4,043 posts

224 months

Monday 27th February 2017
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You're allowed more than one ISA per year, but only one 'subscribing' ISA at any one time. As long as the total of your ISAs adds up to your limit or less, you are fine. For example, I could have £5k with TPInvestor from a few months ago and also £10k in Fundsmith active now.

If you have hit your limit for TY 16/17, you could always wait a month and start a new ISA with TPI or Fundsmith (I am in the Fundsmith fund on the TPI platform as I get the mobile app access to check values/make changes etc).

If you wanted an easy life and had a but of this TY's allowance left, you could just top up another £500 into your existing ISA and then start with a new provider as above for April onwards.


rsbmw

3,464 posts

104 months

Monday 27th February 2017
quotequote all
PhantomPH said:
You're allowed more than one ISA per year, but only one 'subscribing' ISA at any one time. As long as the total of your ISAs adds up to your limit or less, you are fine. For example, I could have £5k with TPInvestor from a few months ago and also £10k in Fundsmith active now.
I don't believe this is true. As far as I am aware, you are only allowed to subscribe (contribute) to one of each type of ISA (cash/S&S) in any given tax year. You couldn't for example pay £5k into one cash ISA in May, then another 5K into a different cash ISA in December. You could however pay £5k into a cash ISA with Halifax, then £5k into a S&S ISA with HL.

Any ISA's you have subscribed to in previous tax years can obviously be retained, so long as you don't pay new funds into them.