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29th
Dec 2020
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What Do I Need To Open An ISA

What Do I Need To Open An ISA

Individual Savings Accounts are a well-known tax-efficient investment option. So how exactly do you go about getting one?

Individual Savings Accounts are a well-known tax-efficient investment option. So how exactly do you go about getting one?

Decide how much you can invest

Your first decision is to decide how much you want to commit to the ISA. You can make regular monthly contributions, a single contribution, or a combination of the two.

Unless you want to take out a cash ISA – where interest rates are very low at present – then your investment will be exposed to the stock market, where its value can fall as well as rise. This means that you shouldn’t invest all of your available funds in the ISA, and you need to think carefully about what level of investment loss you can tolerate. If you are in any doubt, you might want to seek professional advice.

Decide where you want to invest

Then, you need to decide which form (s) of ISA you want to use, and with which provider (s), taking advice if necessary.

The various types of ISAs open to you include:

  • Cash
  • Stocks & shares
  • Lifetime (only available to under 40s)
  • Innovative Finance
  • Junior

In each tax year, you can invest a total of £20,000 across cash, stocks & shares, lifetime and innovative finance. You can choose to split the £20,000 between these four types, or between just two or three, or you can choose to put the whole £20,000 in one type of ISA, such as stocks and shares ISA. The only exception here is the lifetime ISA, where personal contributions are restricted to £4,000 per year, so the remaining £16,000 would need to be invested in other forms of ISA.

In addition to this £20,000, you can invest up to £9,000 in a Junior ISA – these are opened by parents and guardians in the names of their children, after which anyone can make contributions on the child’s behalf.

Have the necessary information to hand

As with any financial product, there will be an application form where you will need to enter your personal details. Many of these details will be easy to complete, but make sure you have your National Insurance number to hand, together with details of the bank account from which you would like your ISA funds to be taken.

Have any necessary documentation to hand

The provider and/or your adviser will carry out some form of identity verification. This may be carried out electronically and you might not be aware of this. Alternatively, you might be asked to provide a document such as a passport or driving licence to prove your identity and a utility or council tax bill to prove your address.

Ways to open an ISA

Depending on the provider, there may be many different ways to open an ISA:

  • In person, perhaps in a branch of a bank or building society
  • By phone
  • At a meeting with a financial adviser, with the adviser completing the necessary formalities on your behalf after the meeting
  • By post
  • Online
  • Via a mobile app

If you apply electronically, you are likely to be asked to set up a username and password. Your password needs to be something you can remember, but also something that other people aren’t likely to guess. 

Investment Fund Supermarket ISAs

Stocks & Shares ISA

from Legal & General

Allows ISA Transfers
  • Protection Scheme: FSCS
  • Fund Choice: Choose from 50+ L&G funds including low cost index tracker funds, multi asset, fixed income, property & equity funds. Alternatively let L&G managed your funds for you based on your risk profile.
  • Invest From: £20 per month or £100 single

Why we like it: With L&G there is no platform service fee. Legal & General can help you save for a brighter future with their stocks and shares ISA. Choose from over 50 funds, including ready-made investment options that spread your money across different investments for you and sustainable funds that seek to make a positive difference without compromising financial returns. 

Important: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Stocks & Shares ISA

from Interactive Investor

Allows ISA Transfers
  • Protection Scheme: FSCS
  • Fund Choice: Access 40,000+ UK, US and international shares on 17 global exchanges. Choose from over 3,000 funds or select a ready made portfolio. Investment trusts, ETFs, Bonds & Gilts. Option to invest in 6 low cost funds selected by experts to get you started.
  • Invest From: £25 a month or any lump sum

Why we like it: An award-winning ISA that gives you complete control. The second largest platform in the UK with the widest choice of investment options in the market including funds, investment trusts, ETF’s and more. Strong ethical investment proposition with more than 140 investment options. Open online in less than 10 minutes. Access to expert independent ideas and analysis. Low cost fees and trading.

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Stocks & Shares ISA

from Hargreaves Lansdown

Allows ISA Transfers
  • Protection Scheme: FSCS
  • Fund Choice: 2,500+ Funds
  • Invest From: £25 pm

Why we like it: Choose your own funds or alternatively a ready made portfolio. Market-beating savings and discounts of up to 5.5%. No charge to buy and sell funds. Low, tiered annual charges for holding funds, with a maximum of just 0.45% per annum. Free fund updates and analysis from experienced research team. Invest with a financially secure, FTSE 100 company.

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Junior ISAs

Junior ISA

from Interactive Investor

Regular Savings
  • Investment Options: Choose from more than 40,000 UK and global investment options for your child's ISA.

Why we like it: ii offer a flat fee service which over time could save you money compared to platform providers who charge on the value of investments held. ii offer ready made funds including their ethical funds which allows you to invest in line with your principles covering environmental, social and governance factors.

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

High Income ISAs

High income ISA ideas:

ISAs Products

Cash ISAs

Fixed Rate & Instant Access ISAs:

Cash ISAs: 

Stocks & Shares ISAs

Types of Stocks and Shares ISA include: 

Stocks and Shares ISAs

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