Hi all,
My wife and I are looking to start saving a fixed amount of 300 each month over the next 10 years (circumstances permitting of course!) towards our 1 year old daughters private education (11-18 years of age).
What are good secure options for doing this - obviously with maximum return?
I do have my financial advisor (independent) coming out to see us next week but would like a few things to discuss in greater detail with him
All advice gratefully accepted.
Thanks
Given that equities outperform savings accounts in 94% of ten year periods, equities (ie shares).
Since high income funds impose a sensible investment policy on fund managers I'd be looking for one of those.
Use Trustnet to compare - Equity Income -
Investment Trusts - Unit Trusts & OEICS -
Index trackers -
Unit Trusts & OEICS -
If he suggests trackers, compare the costs with exchange traded funds (ETFs) which do the same job cheaper and better (but don't pay advisors commission I believe)
Put whatever investment is chosen into an ISA - the CGT saving may make it worthwhile and you don't need to enter it on a tax return.
Unit trusts generally have higher charges than investment trusts but they can be recouped by using someone like Intelligent Money who charge a flat fee of £35pa and recoup all initial & annual commission.
Always ask them what initial & annual commission they take on each monthly tranche.
IFAs are good for a holistic fact find (eg does it make more sense to pay off debt?), but beyond that, take more commission than they're worth imo. You can change advisor to someone like Intelligent Money, but expect the original advisor to bill you for lost commission as allowed under most advisor - client contracts. It's better listen to what he says but don't sign up for anything on the spot.
You might want to consider a single contribution to a stakeholder pension for her. One contribution of the maximum (£3,600 gross pa) over the minimum 49 year timespan could remove the possibility of living out her retirement in poverty. It won't make her rich - but that's her problem !
Daytona
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