What would you do? Saving/Investment Question
Discussion
Just interested in what the general consensus would be if you were in my position. I'll look at any suggestions and would do my own research but some tips would be appreciated.
I am 28 and have approx £1400 after all living costs/expenses to save/invest with no debts except student loan which i'm just going to continue paying off with normal salary. I also have a mortgage which is just in the process of being remortgaged (looking at a 5 year fixed deal currently), currently at just over 90% LTV. I have approx 3 months of emergency savings which will pay the mortgage and bills if I were to lose my job.
Up until now I have been putting that spare money aside to save for a house deposit, house improvements and holidays but would like to now start looking to the future. I'd like to retire at a decent age (somewhere between 50 and 60), not the 65+ which it looks like it may get to, so looking to build up a bit of a money pot in addition to my work pension which I am maxing out contributions to. I would also like to be able to access some of the money just in case I need it.
At the moment I am looking at potentially splitting that money up into 4 sections:
In terms of the S&S ISAs I am looking at opening either a nutmeg or vanguard account (potentially both)? Any suggestions on this and which funds I should look at?
I am 28 and have approx £1400 after all living costs/expenses to save/invest with no debts except student loan which i'm just going to continue paying off with normal salary. I also have a mortgage which is just in the process of being remortgaged (looking at a 5 year fixed deal currently), currently at just over 90% LTV. I have approx 3 months of emergency savings which will pay the mortgage and bills if I were to lose my job.
Up until now I have been putting that spare money aside to save for a house deposit, house improvements and holidays but would like to now start looking to the future. I'd like to retire at a decent age (somewhere between 50 and 60), not the 65+ which it looks like it may get to, so looking to build up a bit of a money pot in addition to my work pension which I am maxing out contributions to. I would also like to be able to access some of the money just in case I need it.
At the moment I am looking at potentially splitting that money up into 4 sections:
- Overpay mortgage each month (probably £200 overpayment which would be a 25% overpayment)
- S&S ISA for long savings (or possibly a SIPP)
- S&S ISA for short term income
- Standard cash ISA (so that I can access it instantly if required)
In terms of the S&S ISAs I am looking at opening either a nutmeg or vanguard account (potentially both)? Any suggestions on this and which funds I should look at?
If I were in your situation I would overpay the mortgage and do the S&S long term savings drop feeding £200-£400 a month into it I don’t see why you need an income S&S isa? Or a cash isa tbh I’d do the long term isa plus cash in the bank oh and spend some while your still young!
Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
BoRED S2upid said:
If I were in your situation I would overpay the mortgage and do the S&S long term savings drop feeding £200-£400 a month into it I don’t see why you need an income S&S isa? Or a cash isa tbh I’d do the long term isa plus cash in the bank oh and spend some while your still young!
Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
I wasn't sure about the income S&S ISA so that pretty much ends that idea! Well i've been using the cash ISA as somewhere to keep my savings for now. Guess I could close that and just use my current account to keep the cash in the bank. Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
Why do you say HL over the other two?
Im 2 years younger than you, and in a similar position. (albeit all the figures you gave are bigger than mine)
Why not learn to invest in companies you've picked yourself? A little bit of learning now is bound to reap rewards later down the line as you still have 10s of years left before you need the money.
If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
Why not learn to invest in companies you've picked yourself? A little bit of learning now is bound to reap rewards later down the line as you still have 10s of years left before you need the money.
If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
Personally, I would decide first if you need to build your 'safety net' up to a bigger level, based on your circumstances and attitude to risk.
After that, I would overpay your mortgage up to the maximum level you can. Always good for the psyche to own where you live.
After that, I would maximise your pension contribution, up to the point where you still have sufficient money for the day to day. This minimises your income tax.
Once you get your pension to point where you think you have it in hand to reach your pension LTA, focus on ISAs.
Everyone is different of course and has different priorities, but this approuch would work for me
After that, I would overpay your mortgage up to the maximum level you can. Always good for the psyche to own where you live.
After that, I would maximise your pension contribution, up to the point where you still have sufficient money for the day to day. This minimises your income tax.
Once you get your pension to point where you think you have it in hand to reach your pension LTA, focus on ISAs.
Everyone is different of course and has different priorities, but this approuch would work for me
fiatpower said:
BoRED S2upid said:
If I were in your situation I would overpay the mortgage and do the S&S long term savings drop feeding £200-£400 a month into it I don’t see why you need an income S&S isa? Or a cash isa tbh I’d do the long term isa plus cash in the bank oh and spend some while your still young!
Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
I wasn't sure about the income S&S ISA so that pretty much ends that idea! Well i've been using the cash ISA as somewhere to keep my savings for now. Guess I could close that and just use my current account to keep the cash in the bank. Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
Why do you say HL over the other two?
If you are a higher rate tax payer then use a SIPP/pension. If you are not then use your Lifetime ISA and your regular ISA allowance first.
Paying off your mortgage may provide a lower financial return over the mortgage period, but will provide absolute certainty.
You need to decide what is more important to you today, and the future you.
Benbay001 said:
Why not learn to invest in companies you've picked yourself? A little bit of learning now is bound to reap rewards later down the line as you still have 10s of years left before you need the money.
If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
Most stock pickers, even the ones that do it professionally, will underperform the market.If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
That's fine if it's an enjoyable hobby but I wouldn't recommend it over low-cost indexing for the average person.
fiatpower said:
I wasn't sure about the income S&S ISA so that pretty much ends that idea! Well i've been using the cash ISA as somewhere to keep my savings for now. Guess I could close that and just use my current account to keep the cash in the bank.
Why do you say HL over the other two?
I’ve been with HL for decades I just like the way they do things good free research lets you understand what funds your investing in. I don’t think nutmeg let’s you pick individual funds? They pick them for you and by reading the nutmeg thread not so well I haven’t looked into them so much as I’m happy doing my own thing through HL. Why do you say HL over the other two?
Is there much interest to be had through a cash isa over the high street?
Paying down your mortgage and long term savings should be a priority especially at 90% LTV.
You don’t mention other pension provision. Does your employer pay in? How much? If this is all gearing you up for retirement in 30 years then that’s pretty important.
BoRED S2upid said:
Ps you know you can only open 1 and pay into 1 isa in a tax year it can still be a mixture is S&S and cash but only with1 provider. Personally that HL for me rather than nutmeg or vanguard. There is a thread on here about nutmeg.
I believe this is incorrect. You can pay into a Cash ISA and a separate S&S ISA in the same tax year, with different providers, but only one of each.There's nothing to stop you opening a sinlge S&S ISA and investing in a mixture of capital growth investments and income investments, or sticking to income and reinvesting some of the dividends, or sticking to capital growth and selling some "grown" units to get some income.
In general have you looked at the reddit ukpf flowchart? That's a good starting point on prioritization:
https://i.imgur.com/BfHzwr9.png
Benbay001 said:
Im 2 years younger than you, and in a similar position. (albeit all the figures you gave are bigger than mine)
Why not learn to invest in companies you've picked yourself? A little bit of learning now is bound to reap rewards later down the line as you still have 10s of years left before you need the money.
If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
I would like to at some point in the future but want to start off with just simply investing in a fund and leaving it alone. What do you use to trade?Why not learn to invest in companies you've picked yourself? A little bit of learning now is bound to reap rewards later down the line as you still have 10s of years left before you need the money.
If youre anything like me, im really enjoying learning about the market and the companies.
Important to add that I fully appreciate at the start I will get it wrong numerous times and probably lose money before I work out what im doing.
EddieSteadyGo said:
Personally, I would decide first if you need to build your 'safety net' up to a bigger level, based on your circumstances and attitude to risk.
After that, I would overpay your mortgage up to the maximum level you can. Always good for the psyche to own where you live.
After that, I would maximise your pension contribution, up to the point where you still have sufficient money for the day to day. This minimises your income tax.
Once you get your pension to point where you think you have it in hand to reach your pension LTA, focus on ISAs.
Everyone is different of course and has different priorities, but this approuch would work for me
I was thinking of upping the mortgage payments a bit more as it would be nice to pay off sooner, definitely one option to look at. A percentage of the cash I will put aside (not in an ISA) will be put into the safety net pot to continue building it up, just not as quickly. After that, I would overpay your mortgage up to the maximum level you can. Always good for the psyche to own where you live.
After that, I would maximise your pension contribution, up to the point where you still have sufficient money for the day to day. This minimises your income tax.
Once you get your pension to point where you think you have it in hand to reach your pension LTA, focus on ISAs.
Everyone is different of course and has different priorities, but this approuch would work for me
BoRED S2upid said:
I’ve been with HL for decades I just like the way they do things good free research lets you understand what funds your investing in. I don’t think nutmeg let’s you pick individual funds? They pick them for you and by reading the nutmeg thread not so well I haven’t looked into them so much as I’m happy doing my own thing through HL.
Is there much interest to be had through a cash isa over the high street?
Paying down your mortgage and long term savings should be a priority especially at 90% LTV.
You don’t mention other pension provision. Does your employer pay in? How much? If this is all gearing you up for retirement in 30 years then that’s pretty important.
Not much interest with a high street cash ISA, I’ve been using it up till now just to build up my savings. More than likely going to close that now and transfer all the money to a spare current account I have where I can keep my safety net money. Is there much interest to be had through a cash isa over the high street?
Paying down your mortgage and long term savings should be a priority especially at 90% LTV.
You don’t mention other pension provision. Does your employer pay in? How much? If this is all gearing you up for retirement in 30 years then that’s pretty important.
My employer does pay in, can’t remember exactly what but think it was 8%. I have maxed out my contribution already.
xeny said:
I believe this is incorrect. You can pay into a Cash ISA and a separate S&S ISA in the same tax year, with different providers, but only one of each.
There's nothing to stop you opening a sinlge S&S ISA and investing in a mixture of capital growth investments and income investments, or sticking to income and reinvesting some of the dividends, or sticking to capital growth and selling some "grown" units to get some income.
In general have you looked at the reddit ukpf flowchart? That's a good starting point on prioritization:
https://i.imgur.com/BfHzwr9.png
Thanks for that will take a look at the chart. Never really looked into reddit, some interesting stuff on there. There's nothing to stop you opening a sinlge S&S ISA and investing in a mixture of capital growth investments and income investments, or sticking to income and reinvesting some of the dividends, or sticking to capital growth and selling some "grown" units to get some income.
In general have you looked at the reddit ukpf flowchart? That's a good starting point on prioritization:
https://i.imgur.com/BfHzwr9.png
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