This post was written in collaboration with Sincerity To help you understand the benefit of investing. Please note that The value of investments can fall as well as rise, so you may get back less than you invest. If you invest in an ISA, there is no capital gains tax on the growth and no income tax on the interest. The value of the tax savings and eligibility to invest in an ISA depends on personal circumstances. All tax rules may change in the future.
I’m always looking for ways to diversify my income and there are some real benefits to investing (see How to Start Investing). We certainly have some big financial goals in the next few years, and we believe that saving in IIAs will help us achieve those goals.
Saving with ISAs
Putting money into an individual savings account, or individual savings account, is a really popular way to save money because you can invest up to £20,000 in the 2017-18 tax year, tax-free. There are four types of ISA accounts you can have:
- Cash Isa
- Stocks and shares Isa
- Innovative Finance ISA
- Lifetime ISA
In order to open an ISA account, you must be over 16 (cash) or over 18 (stocks and shares) and under 40 (lifetime ISA) as well as a UK resident.
You can choose to save in a mix of ISA accounts (bear in mind that a Lifetime ISA has a cap of £4,000 per year), as long as you don’t exceed your allowance of £20,000 across all ISA accounts.
You might be interested in learning how we save and invest our money.
How to save into an ISA when you don’t think you can
Saving £20,000 in your ISA this tax year may seem out of reach for you, but don’t let that stop you from getting started! Even if you can’t reach the £20,000 stash, saving anything is better than nothing.
There are many ways you can cut back on your spending or earn extra money to put into your ISA. Here are some ideas:
- Take a packed lunch to work instead of buying it. Daily savings: £3 – £5
- Complete online surveys to earn extra money. Monthly earnings: £50 – £100
- Spend an afternoon comparing your utility prices – you may be able to save money by switching suppliers or choosing different tariffs/packages. Monthly saving: £50+
- Organize your home and sell unwanted items on eBay, at car boot sales, and more. Earn up to £4,000 over the course of the year
- Meal plan, which helps you buy less from supermarkets and reduce waste. Weekly saving: £20+
- Are you a social media user? What about a spreadsheet addict? If you have a service you can offer, consider becoming a virtual assistant to earn more money. Hourly earnings: £20+
You may also want to consider some unusual ways to invest.
Investment benefits at the beginning of the tax year
Is there an ideal time to invest? Of course investing at any time is better than just not investing at all, but did you know that choosing to invest from the start of a new tax year generally means you’ll be able to earn more? This is because your investment needs longer to accumulate.
Here’s an example for you – if a Dedicated ISA investor used their ISA at the start of every tax year since 2007, they could now be £8,500 better off than someone who invested the same amount of money on the last day of every tax year . Although this is a general example (remember that some investments can go down or up), it represents a huge difference over the years!
Of course, it would be great if we could all put a lump sum of £20,000 into our investment accounts straight away, but this may not be possible for many of us. You can still see better returns if you start investing monthly from the beginning of the tax year rather than leaving it until the end of the tax year.
The tax year runs from April 6 to April 5 of the following year, which means now is a good time to start thinking about any… Investments want to make. Personally, I think there are some real benefits to investing at the start of the new tax year. If you need help, consider looking for it ECN brokers.
Investment benefits – investment offers
Did you know that a lot Investment platforms Do you have some great offers?
These include a lot of free money!
Ziglu – Get £5 (£1 investment)
Sign up to Ziglu, deposit £1, buy cryptocurrency (I chose Bitcoin) and add £5 to your account. These are withdrawable funds.
Twino – Get £15 free (investment £100)
Sign up to Twino, invest £100 and get £15 free. You will receive the money the day after your investment.
Orca – Get a stake worth up to £200 (£1 deposit)
To get your free share worth up to £200, simply click here and submit your email address. Then download the app and set up your account. Top up your account using bank transfer or Apple Pay (£1 will suffice) and a mysterious share will appear in your account within 3 days. Simply scratch to reveal the post you received. To check how much you’ve received, click on the profile icon and select “Free Stocks.” Click on the company name and the value of your share will appear at the top of the page.
Wealthify – Free £25 after investing £500 for 3 months (investment £500)
Sign up to Wealthify, invest a minimum of £500 for 3 months and get £25 cashback.
PensionBee – transfer your pension and get £50 (transfer or start pension)
Get £50 added to your pension when you successfully transfer your pension to PensionBee.
