What to do: April 6th
Discussion
Pondering what to do on April 6th when the ISA allowance resets.
Current breakdown: (Figures not exact)
100% of investments are in S&P 500 Accumulation fund.
Lets say that this is 50k.
Another 60k sat in various places (premium bonds/easy access saving accounts etc)
No big purchases planned
No car finance
No credit card
No debt other than mortage
No children
Have around 15k tidied up a a few motorbikes I could easily sell if needed.
Aim of the investment is long term growth - early retirement fund.
I'd like to get my S&S ISA to over 100k as soon as possible to make the most of any compound interest.
Currently 30 years old
Plan in my head is to:
Immediately max out the 25'/26' ISA allowance but invest in Global All Cap index fund.
Mainly to diversify as I am currently 100% US.
Although the downside to this is that it is still heavily weighted towards the US, historically this hasn't really been an issue and given the time scales I am looking at, the current Trump impact isn't worrying me too much.
Keep remaining cash in the highest interest savings account possible, then do the same next April.
Overpay mortage using salary. (This would mean I wont be increasing my savings by much)
Balance these over payments with Holidays.
Sound alright or am I missing something?
I did have a period of time looking at getting a Buy To Let to get more money into property but doesn't seem like an appealing market to be in.
Only other option I can see is to move invest into moving house.
Currently place is fine for the two of us, we have renovated it over the last 5 years and its as done as a house ever is.
Current breakdown: (Figures not exact)
100% of investments are in S&P 500 Accumulation fund.
Lets say that this is 50k.
Another 60k sat in various places (premium bonds/easy access saving accounts etc)
No big purchases planned
No car finance
No credit card
No debt other than mortage
No children
Have around 15k tidied up a a few motorbikes I could easily sell if needed.
Aim of the investment is long term growth - early retirement fund.
I'd like to get my S&S ISA to over 100k as soon as possible to make the most of any compound interest.
Currently 30 years old
Plan in my head is to:
Immediately max out the 25'/26' ISA allowance but invest in Global All Cap index fund.
Mainly to diversify as I am currently 100% US.
Although the downside to this is that it is still heavily weighted towards the US, historically this hasn't really been an issue and given the time scales I am looking at, the current Trump impact isn't worrying me too much.
Keep remaining cash in the highest interest savings account possible, then do the same next April.
Overpay mortage using salary. (This would mean I wont be increasing my savings by much)
Balance these over payments with Holidays.
Sound alright or am I missing something?
I did have a period of time looking at getting a Buy To Let to get more money into property but doesn't seem like an appealing market to be in.
Only other option I can see is to move invest into moving house.
Currently place is fine for the two of us, we have renovated it over the last 5 years and its as done as a house ever is.
Pension:
Paying 10% in which is matched by employers
I moved the pension into a less conservative option last year which has exposes it to more growth
Its an 80:20 set up rather than the standard 60:40 if that makes sense.
Kids isn't straight forward for us currently so thats on hold.
Definitely sitting on too much cash but I'm limited to maxing out the 20k each year for the next few years.
I did buy a V8 last year so thats that itch scratched for now.
Paying 10% in which is matched by employers
I moved the pension into a less conservative option last year which has exposes it to more growth
Its an 80:20 set up rather than the standard 60:40 if that makes sense.
Kids isn't straight forward for us currently so thats on hold.
Definitely sitting on too much cash but I'm limited to maxing out the 20k each year for the next few years.
I did buy a V8 last year so thats that itch scratched for now.
TechnoKnows said:
Pension:
Paying 10% in which is matched by employers
I moved the pension into a less conservative option last year which has exposes it to more growth
Its an 80:20 set up rather than the standard 60:40 if that makes sense.
Kids isn't straight forward for us currently so thats on hold.
Definitely sitting on too much cash but I'm limited to maxing out the 20k each year for the next few years.
I did buy a V8 last year so thats that itch scratched for now.
I assume you’re maxing out your partners ISA allowances too?Paying 10% in which is matched by employers
I moved the pension into a less conservative option last year which has exposes it to more growth
Its an 80:20 set up rather than the standard 60:40 if that makes sense.
Kids isn't straight forward for us currently so thats on hold.
Definitely sitting on too much cash but I'm limited to maxing out the 20k each year for the next few years.
I did buy a V8 last year so thats that itch scratched for now.
Even just dumping that cash into a cash ISA or something equally liquid will mean you don’t lose that year of allowance.
Perhaps in the odd one but my wife and I treat all our allowances and such as one vehicle and use them where we can to minimise tax.
okgo said:
I assume you’re maxing out your partners ISA allowances too?
Even just dumping that cash into a cash ISA or something equally liquid will mean you don’t lose that year of allowance.
Perhaps in the odd one but my wife and I treat all our allowances and such as one vehicle and use them where we can to minimise tax.
Without getting too personal, our finances are fairly seperate. Even just dumping that cash into a cash ISA or something equally liquid will mean you don’t lose that year of allowance.
Perhaps in the odd one but my wife and I treat all our allowances and such as one vehicle and use them where we can to minimise tax.
Together but not married
Mr Pointy said:
"Only other option I can see is to move invest into moving house"
I'd look at this. Houses never get cheaper so if you have any thoughts of moving up then do it sooner rather than later.
This is option is going to get more attention I think for that very reason.I'd look at this. Houses never get cheaper so if you have any thoughts of moving up then do it sooner rather than later.
TechnoKnows said:
Definitely sitting on too much cash but I'm limited to maxing out the 20k each year for the next few years.
.
You've presumably got a CGT and dividend allowance? You could consider holding some equities in a taxable account for a year and next ISA year move them into your ISA then, rinse and repeat. If you want less in cash, that is a way to achieve it..
Hopefully St Rachel of Reeves isn't going to announce any of,
a sudden reduction of the annual allowance, or
a cap on total ISA holdings beyond which no further contributions are allowed, or
a cap on how much can be withdrawn tax free each year.
After all, only the wealthiest people have large ISA savings and the new tax is necessary "to save the NHS; to save the country from Putin; to build a million new homes; to ensure growth and prosperity for all by the end of this decade".
a sudden reduction of the annual allowance, or
a cap on total ISA holdings beyond which no further contributions are allowed, or
a cap on how much can be withdrawn tax free each year.
After all, only the wealthiest people have large ISA savings and the new tax is necessary "to save the NHS; to save the country from Putin; to build a million new homes; to ensure growth and prosperity for all by the end of this decade".
Panamax said:
Hopefully St Rachel of Reeves isn't going to announce any of,
a sudden reduction of the annual allowance, or
a cap on total ISA holdings beyond which no further contributions are allowed, or
a cap on how much can be withdrawn tax free each year.
After all, only the wealthiest people have large ISA savings and the new tax is necessary "to save the NHS; to save the country from Putin; to build a million new homes; to ensure growth and prosperity for all by the end of this decade".
Don't start because I'll start losing sleep.a sudden reduction of the annual allowance, or
a cap on total ISA holdings beyond which no further contributions are allowed, or
a cap on how much can be withdrawn tax free each year.
After all, only the wealthiest people have large ISA savings and the new tax is necessary "to save the NHS; to save the country from Putin; to build a million new homes; to ensure growth and prosperity for all by the end of this decade".
I'm a 20% tax rate payer as well so can't exactly be classed as wealthy wealthy by any means.
I work a normal job in a factory doing shift work and overtime here and there.
Just sensible
Maybe too sensible... *goes to autotrader*
TechnoKnows said:
I'm a 20% tax rate payer as well so can't exactly be classed as wealthy wealthy by any means.
I work a normal job in a factory doing shift work and overtime here and there. Just sensible
Good lad.I work a normal job in a factory doing shift work and overtime here and there. Just sensible
Tip: You might want to think about running a "global" fund investment alongside that S&P500 so you don't have all your bets on one horse.
Tip: You're doing the right thing having risk (S&S) investments in the ISA and cash elsewhere.
Tip: I hate Premium Bonds because the typical investor's return is so poor and the tax free factor doesn't really help.
Tip: If you ever find the words "car" and "investment" in the same sentence, run like hell!
TechnoKnows said:
Pension: Paying 10% in which is matched by employers. I moved the pension into a less conservative option last year which has exposes it to more growth. Its an 80:20 set up rather than the standard 60:40 if that makes sense.
Again, that's all good IMO. 20% going in from a young age should grow nicely.Tip for others: If possible, always try to contribute enough to your pension to pull out the maximum match from your employer.
you can never 'buy back' the lost opportunity of tax free allowances via say the ISA's, and the compunding efect that you alluded to.
What you could think about is a flexible stocks/shares ISA, where if you needed you could draw out and replace during the same financial year - this is overlooked by many and can be quite a useful thing to have.
if you don't want to actively manage/take an interest in how your investments are doing, then ETF's are fine - but with that is the understanding that its a weighted basket - amongst which will be a load of dross; which underperforms against the top holdings in those etf's. You could perhaps consider attributing some funds in a new ISA towards a less diverse 'basket' to reap higher returns - especially if you're not thinking about accessing for a number of years.
even if it was only a small portion of a new allowance; since '23, SPY up 47% , goog up 87%, amzn 120, meta 400%, nvda 700%.....those kind of outperformers have pulled SPY up by that 47%, which shows how poor the performance of the rest of an index can be, or how the performamce of the 'poorer ones' can affect the outcome.
What you could think about is a flexible stocks/shares ISA, where if you needed you could draw out and replace during the same financial year - this is overlooked by many and can be quite a useful thing to have.
if you don't want to actively manage/take an interest in how your investments are doing, then ETF's are fine - but with that is the understanding that its a weighted basket - amongst which will be a load of dross; which underperforms against the top holdings in those etf's. You could perhaps consider attributing some funds in a new ISA towards a less diverse 'basket' to reap higher returns - especially if you're not thinking about accessing for a number of years.
even if it was only a small portion of a new allowance; since '23, SPY up 47% , goog up 87%, amzn 120, meta 400%, nvda 700%.....those kind of outperformers have pulled SPY up by that 47%, which shows how poor the performance of the rest of an index can be, or how the performamce of the 'poorer ones' can affect the outcome.
TechnoKnows said:
Well....
The last few weeks has changed confidence levels.
I've decided to put half of my yearly allowance in as cash and DCA into a mix of S&P 500 and Global
Then see where we are at in 6 months time
Personally I see it as you are getting more shares for your money than previously. They may go down in the short term but if you are in for the long term than I reckon you will be good. Whats that saying about timing the market?The last few weeks has changed confidence levels.
I've decided to put half of my yearly allowance in as cash and DCA into a mix of S&P 500 and Global
Then see where we are at in 6 months time
In the end, I decided to ignore the current and focus on the long term.
Increased my % holding in S&P and also started investing in VWRL.
Now currently ISA maxed out for the year.
Last few weeks has seen a good recovery and back in the green.
Monthly plan is to split any extra savings between the highest interest instant access account (Currently 3.5% - need to look at this) and put some in a premium bond account. Not the best in terms of returns but I find that If I put money into NS&I I am less likely to look at and then spend it.
Increased my % holding in S&P and also started investing in VWRL.
Now currently ISA maxed out for the year.
Last few weeks has seen a good recovery and back in the green.
Monthly plan is to split any extra savings between the highest interest instant access account (Currently 3.5% - need to look at this) and put some in a premium bond account. Not the best in terms of returns but I find that If I put money into NS&I I am less likely to look at and then spend it.
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