Excite

Investment ISA and Cash Isa Comparison

If you have had enough of the rates offered by cash ISAs or other savings accounts, you might be considering an investment ISA, also known as a stocks and shares ISA.  While riskier than cash-based products, an investment ISA can, in comparison, offer the opportunity for higher returns.

There are many different types of investment ISA available, so it is important to make sure you know where your money is being invested.  Some ISAs invest in one specific fund, with a fund manager looking after that fund on your behalf.  It is often possible to choose a mix of funds, so the money you invest is not all in the same fund.  Different funds will have different levels of risk so be sure to ask for advice if you are uncertain about whether or not a particular fund is suitable for you.

Other ISAs invest in a tracker fund, which tracks a particular index by investing in all of the companies making up that index. This means your investment should rise and fall broadly in line with the index.  Some funds track stock markets overseas. Legal General has an ISA available, for example, that follows the FTSE World USA Index.

If you are a more experienced investor, you might be interested in a self-select investment ISA which means you can choose the shares your money is invested in yourself.  This type of ISA is not for anyone who does not fully understand what they are doing.

Finally, bear in mind that investment in a stock market based product is not usually recommended unless you are able to invest for a minimum five-year term.

United Kingdom - Excite Network Copyright ©1995 - 2020