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Since you ask.

Byline: By Peter Rutherford

Mr & Mrs K C from Prudhoe write:

Can you explain more about Isas as we see advertised so many different types. There also seem to be maxi and mini Isas.

An Isa is a tax-free casing in which you wrap your investments. What you choose to put in the wrapper is up to you, provided you keep to the rules. Your savings are not liable to income or capital gains taxes. However, the maximum you can save is up to pounds 7,000 in any tax year.

There are two types of Isa - the mini and the maxi. You cannot have both a mini and maxi in the same tax year.

You can invest up to pounds 7,000 in a maxi Isa. All this can be in stock market investments such as shares or unit trusts or you can put in up to pounds 3,000 cash, pounds 1,000 in insurance and pounds 3,000 in shares.

With mini Isas you can have up to pounds 3,000 in a cash mini Isa, pounds 1,000 in an insurance mini Isa and pounds 3,000 in a shares mini Isa. With mini Isas you can choose a different manager for each element.

As always, I recommend you speak to an independent financial adviser.

Mr L L from Durham writes:

I would value your opinion on putting money into stock market-linked income bonds. We had one a few years ago which did quite well but it matured before the real fall was felt in the stockmarket. With the market seeming so steady, I feel the time may be right to invest again.

A stockmarket income bond is the type of bond which pays a fixed income for a set term (unless you go for a growth option) and repays capital depending on the performance of the stockmarket.

When you look at these bonds the higher the rate on offer, the tougher the requirement of the Footsie or other index and the greater the risk that all your initial capital may not be returned. I always look at these as forming just part of an overall investment portfolio and you must be aware of the risk before you invest. Take advice first.

Mr & Mrs E W from Tynemouth write:

Will an independent financial adviser be able to help us buy a property abroad? We have a large deposit to put down when we cash in some investments and are thinking of raising money on our home.

Most independent financial advisers will be able to assist you.

Questions you will be asked should include: What is the home for? Do you intend to live there permanently? Will you seek income by renting it out? Is it to be a retirement home? Can you afford it? and have you done your calculations correctly? You may also need specialist advice on the country in which you are buying.

Investors Guide, incorporating A Guide to Isas, is available free to readers. Call free on 08000 745 489 or write to me at Rutherford Wilkinson plc, 21A Bridge Street, Morpeth, Northumberland, NE61 1NT. Please also write with queries.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2003 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Business
Publication:The Journal (Newcastle, England)
Date:Jul 15, 2003
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