Vanguard ISA Review 2021 | Is It A Good Investment?

First and foremost, if you’re familiar with how a Stocks and Shares ISA works, then you’ll probably know that they are largely the same regardless of which institution you obtain one from. In a nutshell, a Stocks and Shares ISA is a specific account held at a bank, building society, or stockbroker that allows you to shield some of your capital gains tax from HMRC. In fact, you will be able to utilize your full £20,000 allowance for the 2019/20 tax year, which is great.

With that being said – and unlike a more conventional Cash ISA, you won’t receive a fixed rate of interest. On the contrary, the money that you make (or lose) will be entirely dependent on how your chosen stocks and shares perform. As such, there is no guarantee that you will actually see your money grow, not least because the value of your stocks could just as easily go down. Nevertheless, if you do have an interest in building an investment portfolio, then it is well worth considering doing this through Vanguard.

This is because the platform is home to thousands of financial instruments, including but not limited to stocks and shares, ETFs, and mutual funds. In terms of the fundamentals, you will need to pay a super-low annual fee of 0.15% with Vanguard, which is more than reasonable. You can get started from just £100 per month, or a lump sum of £500 or more. Furthermore, the entire application and account management process can be facilitated online, which makes it really convenient. Finally, and perhaps most importantly, you can withdraw your money out whenever you see fit.

Are you looking to start putting some money away for your children? If so, the safest way to do this is via a conventional Junior Cash ISA. However, with interest rates so low, you might want to consider the merits of a Junior Stocks and Shares ISA. In its most basic form, this operates in much the same way as the aforementioned Stocks and Shares ISA, insofar that your returns will be based on your chosen investments.

As such, it is important that you understand the risks associated with putting your child’s future pot into a Stocks and Shares ISA.  If this is something you are looking to do, then you have the option of investing up to £4,368 in the 2019/20 tax year. As is the case with its adult counterpart, you can get started with a lump sum investment of £500, or alternatively, commit to a monthly investment of £100.

In terms of accessing the money, this won’t be possible until your child turns 18. However, you will have the option of transferring the funds to an external Stocks and Shares ISA. If you do, you’ll need to transfer the entire balance. The Junior Stocks and Shares ISA at Vanguard also comes with an annual fee of 0.15%, although the most that you can pay is £375 in a single year.