New Tax year - investing early in ISAs

Investing early in ISAs

As one tax year ends, another begins – and it's time to get your clients thinking about where they should invest their ISA this year. FundsNetwork^TM offers several option to enable them to invest early and make the most of this year's ISA allowance. Clients undecided where to invest? FundsNetwork Investment Solutions Phasing Monthly Savings Plan

Clients undecided where to invest?

If clients are wary of investing in stocks and shares, investing in our ISA Cash Park will allow them to temporarily have their stocks & shares ISA subscription held in cash. They can also earn a competitive rate of interest until they are ready to invest. (Subject to 20% HMRC charge.)

FundsNetwork Investment Solutions

If your clients are ready to invest, why not take advantage of the new FundsNetwork Investment Solutions Service? It has a range of risk profiled, unfettered multi-manager funds at its core, but also:

offers a way of establishing your clients' attitude to risk
creates an investment solution to ensure those needs are met
places the investment in a suitable tax wrapper
provides the ability to monitor and manage the investment

Phasing

If clients are worried about investing just before a drop in the market, this option allows them to ‘drip feed’ their money into their chosen funds over a period of 6 months. So when prices are high they buy fewer shares in their investment, and when prices are low, they buy more. This doesn't guarantee a profit or protect against losses, but it can help to smooth out the effect of market changes on the value of their investment.

How phasing works:

a lump sum investment is held within a stocks and shares ISA account and invested into the funds of your clients' choice in six equal monthly instalments
interest will be paid on cash awaiting investment (interest earned will be subject to a flat Inland Revenue charge of 20%, which can't be reclaimed)
even if some of the investment is not phased into the fund choices until the following tax year, the investment will still be deemed to have taken place in the tax year it was originally received in, leaving clients with their full ISA allowance available to them for the following tax year
following their original investment, should they subsequently decide that they wish to have all their money still held in cash invested immediately, they can do so by instructing us to do this
simply tick the phasing box when opening the ISA online for your client

Monthly savings plan

If your client doesn't have a lump sum to invest, they could invest monthly instead and start with a relatively small amount (from £50). By investing this way, they can benefit no matter how markets are performing - if share prices go up , the shares they already own increase in value, and if share prices go down, the next payment buys more shares - thereby capitalising on the 'pound cost averaging' effect.

There are plenty of options available to you and your clients for early investing so don’t delay, get your clients to make the most of their ISA allowances and avoid the last-minute rush next year.