As you are probably aware, the markets are a bit turbulent at the moment and investing now may not be immediately on your mind. However, if you do not want to miss out on using this year’s ISA allowance, you can still fully utilise this without investing all of your money immediately.
Investors can benefit from ‘phased investing’ and this is how it works. You invest before the tax year ends and it is initially held in a cash account. Over the next three to twelve months, the amount you invest is drip fed into your investment. It is still regarded as being invested in the current tax year as far as your ISA is concerned. The advantage of investing in this way is that if the markets continue to be turbulent or if the share price does go lower, you will acquire more shares and provided in the long term, the markets rise, you will be better off.
ISA’s have great tax advantages and are very easy to access should you need the funds in an emergency. To recap, the main advantages of investing in an ISA is as follows:-
- You can invest up to £15,240 in the current tax year
- You can access your money at any time
- You can set up income payments from your ISA
- You pay no capital gains tax
- You pay no further tax on income from your investments
- Your ISA can now pass to your spouse on death
- New investments now available to help mitigate IHT
Past performance is not necessarily a guide to future performance and past performance may not necessarily be repeated. The unit price of investments can fall as well as rise.
This article does not provide specific advice and you should always seek professional advice from a qualified adviser before making any decisions.
Contact Martin Dodd on 01902 742221 or email him at [email protected] if you would like talk about money issues.
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