A while back I wrote here about my pensions nightmare. In the end I decided the best route was to keep my existing pension going but top it up by taking full advantage of my ISA allowance, which took a bit of sorting out I can tell you!
Previously I had a regular contribution ISA with Invesco Perpetual which only let you invest in their funds (this one was their European Growth fund). So I cancelled the regular payments that were going into that and have moved the ISA over to Hargreaves Lansdown. Then when the new tax year started, I stuffed the Jupiter China fund into it that I had bought outside of an ISA last year. At the same time I had some old Asia-Pac PEP’s that I also moved across to Hargreaves, and also bought into the Allianz BRIC fund within my ISA, and started new regular contributions to the China and BRIC funds. So at the end of this tax year I should have pretty much used up my £7000 allowance.
Next year I already have plans as I bought another fund outside of an ISA last year which was the Skandia Global Best Ideas, so I’ll put that into the ISA and use the remaining allowance up with regular contributions (although the fund is doing so well it may swallow up my whole allowance when I move it into the ISA). I kept buying these funds outside of the ISA because Invesco Perpetual wouldn’t let me invest in them, but now I’m with Hargreaves I can pretty much invest wherever I want and keep it all in one place. They also do quite good discounts on the fees and pay a loyalty bonus, so it’s quids in all round really. So far I’m really impressed with them.
Looking at my exposure to various markets, it’s fairly well spread at the moment. My pension is predominently invested in the UK, but the ISA avoids the UK and is invested in various countries in Asia (e.g. China, South Korea, Taiwan, Singapore etc.), Europe, India, Russia and South America.
I’m quite chuffed I took the time to do all this, I ended up not having to pay any IFA fees, and I think ISA’s give you much more flexibility in the long run. You may not get tax relief at source, but you don’t pay tax when you cash them in.