Investments

[clasher]

I invested �5,000.00 with a well known society. �2000.00 went into bonds and the rest into a mini isa. Over 2 years exactly, I have a total return of only �372.00 profit. Would I be better off by re-investing in a full Isa. Thank You

[Sweet G]

All of your �5,000 should have gone into an ISA. I suspect that �3,000 (the maximum allowed each tax year) was put into a mini CASH ISA, and the rest into a mini STOCK&SHARES ISA. (the maximum for S&S is �4k per tax year)

Your return of �372 is 7.44% and is only good or bad on what you expect or require from your investment. Intelligent Finance has been paying around 4.5% on its cash ISA for ages so there is scope for improved returns. Without knowing the exact nature of the bond investment or the interest rate on the mini cash ISA I cannot opine on how "good" or "bad" your return actually is. If you want higher returns you must be prepared to take some risks and the investment should be SUITABLE to you. Dont worry if others are making fortunes if you are cautious and happy to keep money in the bank then that is suitable for you. Current consensus is negative on Bonds because as they pay a fixed return they are ******** by interest rate rises by central banks and that has been happening recently.

[Sweet G]

You can invest all in full ISA which is currently �7,000 into a S&S ISA and you could invest in more bonds but is that suitable for you? An ISA is just a wrapper, it is the underlying investment that you must consider, and then what sort of return you would be realistically happy with. You could see returns of 20%+ if Japanese equities (high risk) take off or if you want to play it safer and get 7% next year consider a UK Equity Income Fund. Also do not be blinded by ISA. You can earn 6.24% with HSBC in a non-ISA one year cash bond (if still available). It pays 8% at the end of the year (one lump sum deposit at start, no withdrawls allowed) but after deduction of basic rate tax (22%), which doesnt happen in an ISA, it pays 6.24%, and you will be hard pushed to find a bank account beating that.

[clasher]

Thank You Sweet G, my maths must be out, because I only made the return to be 3.7%, but what do I know. If I pooled this with another Isa I have, plus an endowment due in the new year, this would give me a total sum of around �25,000. What do you think then, that the best method of investment would be, as a full investment or a couple of Isa's and perhaps the rest in a 1 year investment, Thank you for your first two answers, very much appreciated
Clasher