拢70 acrued on an ISA of 拢7000 in a year. Is that good return or are there better investment elsewhere?

My friend was left 拢7000 in a will. She was advised to invest it in an ISA. Its now a year and she got a statement which shows that she has made 拢69 in the year. Neither of us knew what an ISA was. It was the bank that advised ISA. Some people have suggested that she could have made more if she bought bonds etc. Is there anything better than ISA. My friend works full time

This was Lloys TSB/Scottish Widow ISA. My friend was told it maxi ISA. I understand there were some initial charges of about 拢250 taken out of the 拢7000

You do not say what type of investment it is, but the return is poor. There are too many options to list, so check out the web site below. Basically, cash ISA'S, and savings accounts in general will pay about 5% interest per year, depending on the bank rate fluctuations; this is a safe, but has no potential for doing much more then keeping ahead of inflation. Various degrees of risk are attached to other types of investment, but the rewards are more attractive. She could, for example(if she is going to invest for a few years), put half in Corporate Bonds, and half in a Unit Trust(stock market fund). This would spread the risk, but have potential for a decent return, and can be done within the ISA wrapper.
Further comment:-- Taking into account the initial charge,the return would appear to be better, but still not great. Quote from Lloyds/TSB website - "The Maxi-ISA, which means the full annual 拢7,000 ISA allowance may be invested in our range of shares, collective investment schemes like open ended investment companies (OEICs), Government bonds (Gilts), Corporate bonds and Eurobonds. We will manage your Select ISA alongside your portfolio by selecting or recommending the best combination of investments to meet your own financial objectives". In other words,there is a choice to be made as to which of those the investors want thier money in. Bonds, for example, are safer, but have limited potential, share funds are more risky, but can return higher profit. I would guess that your friend has the safer option - a bond type investment. He/she could discuss the matter with the local branch advisor, with a view to changing to a share-based investment..

1%....that sounds rubbish to me. fixed term bonds have a better return.

I have had an ISA for nearly thirteen years years paying in 拢50 a month and its not until nearly 8-9 years until it started making money and that was what i was told when i took it out.

Now every month for the last two years for every 拢50 i put in it goes up 拢250 so for me its worth it.... Ive put in under 拢8000 and the policy is worth over 拢13000 now and is getting better so its only worth investing if your in it for the long haul not a quick buck.

It really depends how the money was invested. If it was a straight cash isa (although 拢7000 in one isa appears to be in excess of the limit) then it is a 1% return which is low. You should be able to get around 6%. If it is an equities isa then, again, 1% over the past couple of years seems low as the markets have been experiencing growth of 10%+ over the past few years. If it is shares of one company then 1% is possible but, again, most stocks will have grown more than this over one year. The investment should be reviewed.

That is not good, your friend is getting screwed, she should have got back about 拢3oo plus, HSBC have an ISA that if you put in 拢3,ooo, for a year you should make 拢120 plus, who ever advised your friend is a Bloody Idiot, sorry but that is only 1 percent, cr@pp.

which company was it with?? Sterling maxi ISA's are doing really well at the moment in the jupiter china fund! :o)

thats like being taken to the CLEANERS!!...u've been ROBBED blind!!

check out this site, should help you decide on where you should put your dosh!.. www.bestinvest.co.uk

good luck, just don't be a MUG, live and learn!

I use self-select share ISA's and average about 40% a year. Your return is typical of the high street rip-off banks where most of you funds are gobbled up by up-front fee's and management charges.

You could have got about 5% by just putting it in a high interest savings account i.e. about 拢350.

Best thing to do is take your money elsewhere. Even if you put that 拢7,000 in a high interest account you would have got back around 拢300.

Stocks and shares ISAs cannot be be judged by the dividends they pay. In fact the lower the dividend the greater the prospect for capital growth.

If the value of the shares has gone up well, you should be satisfied. If not, sell them.