Medium term/Long term

More than 5 years

You probably already have a ‘rainy day’ pot to fall back on in case you have any unexpected expenses. Now you’re thinking about ways you might grow your money, even if this means taking on a little more risk.

Stocks and shares ISA

  • A tax-efficient way to invest
  • Invest up to £15,240 during the 2016/2017 tax year
  • You need to be at least 18.

The value of investments can go down as well as up and you may get back less than you invest.

Your questions answered

What’s a stocks and shares ISA?

  • A way to invest in stocks and shares without paying income tax or capital gains tax on any money you receive from them
  • You can find out more on our ISA page.

Am I eligible to get one?

You need to be:

  • A UK resident
  • Aged at least 18
  • You can’t take out more than one stocks and shares ISA in the same tax year. If you already have an ISA, you can transfer your existing ISA across to us.

How does it work?

  • You don’t pay capital gains tax and no further tax is payable on any income you receive from the fund in which your money is invested. Some investment returns may be received by the fund manager with tax credits or after deductions which they cannot reclaim.
  • There will be a fund management charge which will depend on the fund you choose. You may also have to pay other charges.
  • The value of your investment will go up and down with the value of the fund and you may not get back what you put in. This is different to a cash ISA, where your return is based on the interest rate you receive. With a stocks and shares ISA, you’ll get back the value of your investment in the funds you’ve chosen at the time you decide to close your ISA.
  • You can find out more about the way you feel about risking your money in our section about understanding risk.

How do I pay in?

  • You can invest a lump sum, or if you prefer you can make regular payments into a stocks and shares ISA. Aviva asks for a minimum lump sum of £500 or at least £50 a month. You are also able to transfer an existing ISA to Aviva if you wish.

How much might I think about investing?

To help you think about how much to put away, we’ve developed an Investment calculator. It helps you to see how different monthly amounts, or lump sums, might build up towards your goal.

If you’re not sure how much you can afford, you could use My budget planner. This tool can help you see where you are spending most each month – so you can work out where you might make cutbacks and invest a little more. If you’re thinking about taking out a cash ISA and/or a stocks and shares ISA, you’re allowed to invest up to a limit of £15,240 during the 2016/2017 tax year. You can withdraw money and pay it back in again without counting towards your ISA allowance provided this happens in the same financial year as the withdrawal.

What happens when I’m ready to take out my money?

  • You can withdraw your money from a stocks and shares ISA at any time.
  • But you should think of this option as a medium-to-long term investment of at least five years. If you think you may need to take your money out before then, this kind of investment may not be suitable for you.
  • If you take money out of a stocks and shares ISA, please bear in mind that you may be withdrawing part of your original investment, not just any increase to the value of your investment.

What other options might help with my medium or long term saving?

You could consider:

  • A savings account or cash ISA if you don’t want to risk your capital
  • An investment account if you’re willing to accept some risk and have used your ISA allowance

What’s an investment account?

An investment account refers to any investment you might hold outside of an ISA or a pension. It could contain a variety of investments – including shares, funds and other assets. There will be some risk, and you could lose your original investment.

You might start an investment account if you’ve already used up your ISA allowance, but still want to make more investments, even though you might have to pay income tax and/or capital gains tax​ on any returns.

Find out more about Aviva’s Investment Account.

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