Best investment platform for a newcomer.

[orangesrule]

Hi,

I've read a few other threads on here which has lead me to the belief I should be investing in a stocks and shares ISA/drip feed.

My current position is:
27k cash (20 in 123 account, 4 in premium bonds, 3ish in current account).

Around £440/month total contribution from myself and employer into a pension (managed fund - 50/50 contribution with company, this benifit is maxed)

I have recently paid off my mortgage which changes my position to save more income.

Take home salary is around £2200/month, which will allow me to save around 1200/month.

I am considering putting 50% of monthly savings into S&S ISA, 25% into premium bonds and 25% into a regular savings. For which I would be looking to invest for around 4 years. Until I imagine I'd like to get a mortgage again to get a triple garage. Would this sound like a sensible way to go about things?

Off the back of that, what platforms are best for newcomers and those with a low monthly investment. I also have the option of going through Nationwide building society, are there any reasons not to?

I think I'd be looking to go for a managed fund, what are the key things to look out for? I do understand there is risk and may come out with nothing, but would like to mitigate this as best as possible.

Edited by orangesrule on Thursday 26th April 13:09

[CzechItOut]

I have a S&S ISA with Fidelity and a SIPP with Hargreaves Lansdown. I have to admit I prefer the HL site, it is easy to use, has good analytical tools and a mobile app which allows you to do quick tasks.

Both platforms offer pretty much the same funds, as well as "off the shelf" portfolios you can choose based on your appetite to risk.

I would avoid Nationwide for investing, mainly because they have a poor selection of funds and high fees. They do however offer a Regular Saver which pays 5% interest and you can deposit up to £250 a month. They also have a cash ISA paying 1.4% if you are an existing customer.

[xeny]

Have a read of this:

http://monevator.com/compare-uk-cheapest-online-br...

Personally with regard to initial fund choices, I find the argument here difficult to disagree with:

https://www.youtube.com/watch?v=gM4KEJQ_Z5U

[anonymous-user]

[quote=orangesrule]25% into premium bonds?

Why? Premium Bonds give a truly lousy return. You'd be much better off putting your money somewhere else and buying a lottery ticket once a month.

Use your tax reliefs by putting more into ISA or, better still, pension.

[NickCQ]

Firstly congrats on paying off the mortgage!
Secondly, how much is the triple garage going to cost - why not do that now rather than taking 4 years of investment risk first? 4 years is a short time to be in the equity market, to be honest.

[orangesrule]

rockin said:

orangesrule said:

25% into premium bonds?

Why? Premium Bonds give a truly lousy return. You'd be much better off putting your money somewhere else and buying a lottery ticket once a month.

Use your tax reliefs by putting more into ISA or, better still, pension.

I'm not sure I entirely agree with that, having had 30k in premium bonds, it's certain given me a better 'return' than an ISA would have, with the chance of winning more. That said in terms of small cash amounts your comment is probably right.

As I say in terms of matching commitments my pension is maxed out, though I may contribute 1% more. I also forgot to mention 150/month goes into a company shares scheme. That and I would never get enough interest to be over the tax threshold on interest.

In terms of buying a property now, yes I could do that, my current house is worth circa 200k, just on the edge of the city a 10 minute cycle from work.
However I am currently studying an OU degree, my girlfriend has only just started saving. And for the time being I quite like it where I am (despite my fd3s rx7 being crammed into a single garage).

My thoughts are that in around 4 years my girlfriend should have saved 30k (she's only paying half of bills rather than 'rent'). By then I'll know if she's 'the one' and our joint buying power should secure a forever home, with that triple garage/barn for my toys.

[audidoody]

Nutmeg has done quite well for me. 12.09 per cent over two years. Idiot-proof web site


https://www.nutmeg.com


ETA: if you've paid off your mortgage I'm mystified why you don't take out another one.

If your L/V value is 60% you'll be using cheap money to leverage an appreciating asset over a 10-year-period. Every year you're out of the property market makes it tougher to get back in.

Edited by audidoody on Monday 30th April 10:38

[xeny]

Quoting a performance figure for Nutmeg without at least quoting which risk level portfolio you're using isn't very useful.

I'd guess a lower risk/anticipated return one if it's returned 12.09% ?

[Ari]

audidoody said:

ETA: if you've paid off your mortgage I'm mystified why you don't take out another one.

I'm confused, why would someone with no need of a mortgage want to take out another one?

[lockhart flawse]

Mortgage - well it's as near to free money that we've had in my investing lifetime. My mortgage was over 15% in 1990/91. I was broke by the 4th of the month.

Would you get your money back on the triple garage when you sell the house?

[orangesrule]

I probably didn't explain myself quite well enough. In around 4 years I'll be in a position to look to buy a property with out buildings/triple garage. Unfortunately I don't have the plot to build anything extra in my current house. Hence looking to invest savings from this point forward till that point in time. I appreciate I'd be better off buying a 450k house now, but I'd be reliant on my girlfriend's income to get a mortgage of that size and then she'd be entitled to half. Renovating a house, working full time and doing a degree just isn't viable at the moment.

[red_slr]

(IMHO)

Use as much of your ISA as you can. To get tax free returns on £20k is too good to miss.

Depends on your attitude to risk I guess.