Author Topic: Beginning to invest UK  (Read 5968 times)

bill

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Beginning to invest UK
« on: May 07, 2015, 03:07:30 AM »
Hello!
I'm 25 and want to get a little into investing/saving more seriously. Right now in my life I don't really have a massive amount of time for reading books on the subject and researching it on the web so I'd like some advice on where to put the small amounts of money I have for the immediate future. It will only be smallish amounts of money maybe 200 to 600 pounds a month at most and some months I don't work so it won't be anything at all. It needs to be a fairly flexible way.

I have signed up for Zopa (here is my referral link if anyone wants to try it) https://www.zopa.com/member/d7ad528faf1e and put a little in to see how it works and get a feel for it.

I also have opened a nutmeg account and put the minimum in http://www.nutmeg.com/ it's hard for me to really know just yet if these have been wise moves or not and where I should go now.

What do you recommend?

Thanks!

daverobev

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Re: Beginning to invest UK
« Reply #1 on: May 07, 2015, 09:51:48 AM »
Find a cheap discount brokerage, for example iWeb Share Dealing (there is a comparison list of the UK brokerages somewhere). Open an ISA. Pay in your 600 quid a month. Figure out an asset allocation (eg, 10% VUKE, 20% VEUR, 20% VFEM... etc). Buy in one transaction one ETF every investment (unfortunately trading costs in the UK are relatively high; ideally you want to buy 1k GBP worth at a time, as the trade will cost you 5 pounds).

Then sit back, and watch your money grow. Or, even better, don't watch, just rebalance to you asset allocation as you invest.

The ISA is awesome but "use it or lose it" so you want to get as much in each year as you can. The max if you can.

Financial.Velociraptor

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Re: Beginning to invest UK
« Reply #2 on: May 07, 2015, 10:15:17 AM »
Hey bill.  I can't offer much advice for UK investing, it is outside my circle of competence.  I do want to say "Gogogogogogogogogo!"  Saving 600# a month at age 25 is an epic move.  You will do well.  The rest is details.  I'm sure the UK-ians on the board will have useful advice to get you oriented.

mohawkbrah

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Re: Beginning to invest UK
« Reply #3 on: May 09, 2015, 06:47:24 AM »
a fellow uk investor, for best rates go with either brokers: Hargreaves lansdown or bestinvest and open a stocks and shares ISA with them. gotta love that tax free shelter! :)

i do suggest you read up on investing

investopedia gives good basic insight into how it works.

for now though just go for a vanguard index fund both of those brokers will have them.

drstarter33

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Re: Beginning to invest UK
« Reply #4 on: May 09, 2015, 08:45:32 AM »
to my knowledge at present Charles Stanley is best for ISAs in terms of charges (esp. if you are aiming for mostly funds-dominated ISA). They are slow when it comes to executing fund purchase and selling orders.

HL is really easy to use and they deal very quickly when you buy or sell but they are one of the most expensive ones

Bestinvest is cheaper for SIPPs - and they have a system that is as good as HL.
All the best

bill

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Re: Beginning to invest UK
« Reply #5 on: May 10, 2015, 01:29:07 AM »
Okay! Thanks for the replies! Will look into the options people have mentioned.

Bill

crazylemon

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Re: Beginning to invest UK
« Reply #6 on: May 10, 2015, 02:32:50 AM »
Find a cheap discount brokerage, for example iWeb Share Dealing (there is a comparison list of the UK brokerages somewhere). Open an ISA. Pay in your 600 quid a month. Figure out an asset allocation (eg, 10% VUKE, 20% VEUR, 20% VFEM... etc). Buy in one transaction one ETF every investment (unfortunately trading costs in the UK are relatively high; ideally you want to buy 1k GBP worth at a time, as the trade will cost you 5 pounds).

Then sit back, and watch your money grow. Or, even better, don't watch, just rebalance to you asset allocation as you invest.

The ISA is awesome but "use it or lose it" so you want to get as much in each year as you can. The max if you can.

This although iWeb is now more pricey to open (200) but still 5/trade.

Look around at comparison tables, and remember to think long term. While now a .5% annual fee might be cheaper that isn't going to be the case as your state grows...

Limit for an ISA is now Just over 15k get as close to maxing it as you can!

daverobev

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Re: Beginning to invest UK
« Reply #7 on: May 10, 2015, 04:56:02 AM »
Find a cheap discount brokerage, for example iWeb Share Dealing (there is a comparison list of the UK brokerages somewhere). Open an ISA. Pay in your 600 quid a month. Figure out an asset allocation (eg, 10% VUKE, 20% VEUR, 20% VFEM... etc). Buy in one transaction one ETF every investment (unfortunately trading costs in the UK are relatively high; ideally you want to buy 1k GBP worth at a time, as the trade will cost you 5 pounds).

Then sit back, and watch your money grow. Or, even better, don't watch, just rebalance to you asset allocation as you invest.

The ISA is awesome but "use it or lose it" so you want to get as much in each year as you can. The max if you can.

This although iWeb is now more pricey to open (200) but still 5/trade.

Look around at comparison tables, and remember to think long term. While now a .5% annual fee might be cheaper that isn't going to be the case as your state grows...

Limit for an ISA is now Just over 15k get as close to maxing it as you can!

Two hundred quid to open an account?! That's awful. Insane how brokerage costs are going up in the UK but down in Canada. I guess iWeb want to keep the riff raff out, yuck.

smithy

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Re: Beginning to invest UK
« Reply #8 on: May 13, 2015, 06:10:34 AM »
Hi,

As a fellow UK resident, I can whole-heartedly recommend the Monevator site. In particular, his "Slow and Steady Passive Portfolio" which explains how to diversify and rebalance using a real-world example:
http://monevator.com/passive-investing-model-portfolio/
Historic quarterly updates can be found at:
http://monevator.com/tag/sspu/

He also has an up-to-date comparison table of different UK online brokers:
http://monevator.com/compare-uk-cheapest-online-brokers/

I initially opened an ISA with Charles Stanley Direct (CSD) and pretty much followed Monevator's example passive portfolio. CSD use a percentage based fee structure so are good for smaller sized / new portfolios. I then switched to iWeb Share Dealing Account (opened for a one-off 25 flat fee (but now 200!) and no annual charges) when my portfolio was larger in size and bought a single Vanguard Lifestrategy fund.

Hope this helps.

forummm

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Re: Beginning to invest UK
« Reply #9 on: May 13, 2015, 07:05:55 AM »
Does Vanguard UK not work for you? I don't know the specifics of their UK offerings, but Vanguard US is far and away the best option in the US. In the US, Vanguard doesn't charge any fee to open an account and buying and selling Vanguard funds is free. And expense ratios are as low as 0.05%.
https://www.vanguard.co.uk/uk/portal/portal

daverobev

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Re: Beginning to invest UK
« Reply #10 on: May 13, 2015, 07:08:57 AM »
Does Vanguard UK not work for you? I don't know the specifics of their UK offerings, but Vanguard US is far and away the best option in the US. In the US, Vanguard doesn't charge any fee to open an account and buying and selling Vanguard funds is free. And expense ratios are as low as 0.05%.
https://www.vanguard.co.uk/uk/portal/portal

AFAIK only in the US can you actually have an account WITH Vanguard. Elsewhere you can buy ETFs and funds, but through a brokerage.

smithy

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Re: Beginning to invest UK
« Reply #11 on: May 13, 2015, 08:03:33 AM »
Looks like a 100k minimum to invest directly with Vanguard UK.

However, as stated on the Vanguard UK website, there are plenty of Vanguard funds available in the UK via online brokers / platforms (with much lower minimums than 100k!):
https://www.vanguard.co.uk/uk/portal/investing-with-us/investing-in-mutual-funds

Of course, on top of the Vanguard AMC/TER, you will have a platform fee too when going with an online broker rather than direct to Vanguard UK.

forummm

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Re: Beginning to invest UK
« Reply #12 on: May 13, 2015, 08:05:08 AM »
Does Vanguard UK not work for you? I don't know the specifics of their UK offerings, but Vanguard US is far and away the best option in the US. In the US, Vanguard doesn't charge any fee to open an account and buying and selling Vanguard funds is free. And expense ratios are as low as 0.05%.
https://www.vanguard.co.uk/uk/portal/portal

AFAIK only in the US can you actually have an account WITH Vanguard. Elsewhere you can buy ETFs and funds, but through a brokerage.

https://www.vanguard.co.uk/uk/portal/investing-with-us/investing-in-mutual-funds

It appears you can invest directly with Vanguard UK, but there's a 100k# minimum.

crazylemon

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Re: Beginning to invest UK
« Reply #13 on: May 25, 2015, 02:41:00 AM »


Two hundred quid to open an account?! That's awful. Insane how brokerage costs are going up in the UK but down in Canada. I guess iWeb want to keep the riff raff out, yuck.

Oh yes. Glad I got in when I did. The reason I think a lot of brokerage stuff is going up is that lots of brokers used to make money with recommending funds as 'financial advise'. They are not allowed to do this anymore and other costs have to be very clearly laid out. There are plenty out their that are good for frequent traders but if you are only doing handful of trade a year no one wants you,