Retirement Planning - equity income ISA's

[thekingisdead]

My mum is approaching retirement (7 years to go max) and is starting to think about options to bolster her (fairly meagre) 'officaial' pension income (i.e. funds held in a scheme)

With the cash she has available I have suggested a BTL property and the remainder of her cash (upto 6 figures) into an stocks and shares ISA, focused on income, not growth. A split between the potentially variable income of a BTL and a more stable, although potentially lower yeild from a fund seems like as good a strategy as any to me.

With a couple of BTL's myself i feel im in a fairly good position (famous last words) to advise on that side of the investment, but have very limited experience of equity funds.

I've started to read up on ETF's, investment funds, OEIC's etc, and have a fairly rudimentary understanding, but when it comes to the actual funds am left a bit bewildered by the shear volume of funds out there.

What are people's processes for selecting a fund, is it simply a case of reading up on the composition / objectives of the fund and choosing from there?

Any advice welcome,
Thanks.

[J012E]

I would have to help if I can, I have PM'd you.

Thanks

[Slowped]

Hi,

If the cash is not already in a tax wrapper, then your Mother will only be able to add £11,520 (and rising) per tax year. This doesn't mean that you can't begin with the investing though, outside of an ISA and transfer in the holding piece by piece each year.

A good place to begin would be to get a few magazines such as Shares magazine. If you are looking for income, then you may wish to consider some Investment Trusts and Unit Trusts. Trustnet is a good place to begin research. Moreover, if you are confident and want to take a slightly more involved approach then you could look a FTSE350 equities with good yields. GSK, RDSB, NG., VOD are all very popular. The insurers and utilities pay strong income, Resolution pays 7-8pc.

PM if you want any more specific info on the isa, my firm offers them.

Nick

[thekingisdead]

Thanks slowped

I understand that if equities are held outside an ISA they have to be sold and then bought again inside the ISA wrapper.
Is the same true for funds held in funds, I.e they have to be 'bought and sold' to transfer into that years ISA allocation

[Slowped]

Yes you are correct, it is called 'bed & isa' and has to be done when transferring any eligible securities into the isa. I normally charge a commission on the sale but the buy back is free so you get to use all of the isa allowance on buying up the securities.