How do you mix cash and stocks and shares ISAs
Wednesday, 14 Mar 2007 16:00
How can you move from a pure stocks and shares ISA to a mixture including cash and what are the limits?
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Plugging into IFA Promotion's network of specialist financial advisers myfinances.co.uk answers your questions.
John C asks:
I have a stocks and shares ISA I have held for a number of years and have continued to put £7,000 a year into.
This tax year I want to invest some money in a cash ISA.
Will I be able to vary the £7,000 allowance between a new cash ISA and existing stocks and shares ISA - and if so what are the limits (or guidelines)?
Jason Witcombe of Evolve Financial Planning (www.evolvefp.com) responds
At the moment you have a Maxi stocks and shares ISA. If you wish to invest in cash, you’ll need to set up a Mini cash ISA. The maximum you can invest into this is £3,000 in any given tax year. You can then set up a Mini stocks and shares ISA and invest up to £4,000 into this, bringing you up to the £7,000 limit.
If you have built up a sizeable ISA portfolio, you might like to consider transferring to a Fund Supermarket such as Cofunds or Fidelity Funds Network.
At its simplest, a fund supermarket is a platform enabling you to buy a fund or a selection of funds with choice from many different fund providers (50+).
In the past, if you constructed a portfolio of funds from different management companies, you had to deal with each different manager individually, using different application forms, making separate payments, and receiving separate statements and valuations.
The more you diversified into different funds and different fund managers, the more complicated the whole process became.
Through fund supermarkets it is possible to do all this in one place, filling in one application form, making one payment and receiving one, consolidated statement.
If you have an ISA question, got to www.myfinances.co.uk/ask-the-isa-expert