It’s March! And that means it’s coming up to the end of the current tax year which runs until 5th April. Have you been using your ISA allowance this year? If not, now is a great time to spend a bit of time to get everything in order. ISAs are tax free and there are two types of ISAs – cash ISAs and stocks and shares ISAs, and the total ISA allowance for the 2014-15 tax year is £15,000.
If you are looking for a stocks and shares ISA, I recently came across a platform called Nutmeg which is really easy to use. Basically, you decide on how much risk you’re willing to take on and Nutmeg will set up a professional portfolio for you accordingly. Their fees are low compared to similar ways of investing, ranging from 0.3% to 1% per annum, and there are no trading, set-up or exit fees if you withdraw on their weekly schedule.
I find their website very clear, informative and easy to use. From their home page, clicking on Invest Now lets you try Nutmeg out with a sample portfolio. From there, I simply chose “ISA” as my account type and “Just Invest” as my goal. Steps 2 and 3 then asks you to enter either a lump sum and/or a monthly contribution amount and adjust the risk level you are willing to accept. That’s it! In just 10 minutes you could have a professionally managed investment portfolio! The projected timeframe chart tells me if I’m on track to my goal and if not, it gives me a couple of options as to how I can put it back on track, i.e. by extending my timeframe or increasing my contributions. I like the transparency too – clicking on the List of Investments tab provides the exact make-up of the portfolio. If you were to try to do this yourself, there would be trade fees for each of the funds, not to mention all the time spent researching and maintaining the investment.
I’d recommend taking a look at Nutmeg for it’s simplicity, transparency and cost effectiveness of setting up and maintaining a stocks and shares ISA.
Disclosure: This is a collaboration post.