Newsletter Issue: 1
February 2008

Use It Or Lose It!

You only get one ISA allowance every tax year. You cannot carry your allowance over to next year and therefore, if you do not do something about it, come the end of the tax year, you will lose it.

The allowance for the 2007/08 tax year is £7,000 and is available to be used anytime up until 5th April 2008. However, don't think this means you have to wait - you can use your allowance at any time – and many would suggest that the earlier the better. This is particularly true of Cash ISAs as the earlier you get your money into a deposit account, the more interest you will earn on it. For stocks and shares ISAs, there are those who try to ‘time’ their investment - ie: to buy in when stocks appear cheaper (to benefit more as they recover). However, even experts seldom time the market successfully on a consistent basis so individuals could find this extremely difficult to do effectively. If you are concerned about markets, you could drip feed your money in on a monthly basis - ie: invest smaller, regular amounts - to smooth returns as markets fluctuate. This system is called 'pound cost averaging' and can offer benefits in a volatile or falling market.

Regardless of how you invest your money, you must get in before April 5th or your allowance is gone. Have a conversation with Tony O’Driscoll, do your research, but start now and make sure you don’t lose out.