DIY Investor Magazine
/
March 2014
6
NISA ISA BABY
The first issue of DIY
Investor Magazine
delivered a clarion call
to action for those who
had not yet subscribed
to their ISA as the end
of the 2013/14 tax year
approached as well as
to those early birds seeking to achieve maximum
benefit from the coming period.
Then, on March 19th, George Osborne delivered his
budget which provided the biggest boon to savers and
investors in living memory as well as delivering seismic
changes to the pensions industry.
This edition concentrates upon one of the key deliverables
of Mr Osborne’s speech, the ‘new’ ISA, now colloquially
dubbed the ‘NISA’.
With annual subscription levels raised to £15,000, greater
flexibility in terms of the combination of cash and
investments that can be interchangeably included and a
wider choice of eligible investments means that the NISA
is a really powerful weapon in the DIY investor’s armoury.
With AIM stocks having been permitted within an ISA
wrapper since August 2013, the addition of short-dated
retail bonds and consultation on the inclusion of peer-to-
peer loans means that the NISA can accommodate most
appetites for risk and the ability to switch in and out of
cash means that it is flexible enough to ably adapt to
changes in individual circumstances as well as fluctuating
market conditions.
Similarly, Junior ISA subscription levels increase to £4,000
per year from July 1st which offers parents and those
saving on behalf of children the opportunity to give them
a real financial head start in life.
WHAT DOES THIS MEAN IN
PRACTICAL TERMS?
Even if future subscription levels do not rise, those
subscribing to the maximum level each year and achieving
a 5% return on their investments can now accrue a
£250,000 pot in just twelve years – a useful source of
tax-free income in retirement; those investing £4,000 per
annum for their child and achieving a 5% return will see
junior delivered of £100,000 at aged 18 – that’s tuition fees
sorted and more than a token gesture towards the deposit on
a property.
The DIY investing phenomenon is changing everything; it is
born of necessity and enabled by technology.
DIY Investor Magazine will look at some of the practical issues
around embarking on a self-directed savings and investment
regime and will consider some of the sources of education
and content that will assist you on your journey.
In the post-RDR world the financial services has been
demystified and debunked; technology allows suitably
enlightened investors to construct, test, maintain and share
portfolios and take control of their financial future.
Screening tools track past, present and predicted performance
of individual investments and comparison tools allow
apples-and-apples evaluation as well as opportunity cost
calculations.
Of ever increasing importance in the world of DIY investing
is that of ‘sentiment’ and there are some powerful examples
of how positive community consensus opinion is reflected in
increased share valuations and the converse is demonstrably
true.
DIY Investor Magazine will be at the centre of the debate and
creating a community in the spirit of Kenneth H Blanchard -
‘none of us is as smart as all of us’.
As ever your feedback is encouraged and would be
appreciated –
or at
.
