There is typically a rush of interest in building a Stocks and Shares ISA every April, as the end of the tax year looms. Then, for much of the rest of the calendar, many investors pay little or no attention to their ISA.
But why rush and risk making ill-considered decisions in the heat of the moment?
If I had even a few hundred pounds of spare cash free to invest, I would put it into a Stocks and Shares ISA now.
Three reasons to act, not wait
Off the top of my head I can think of a trio of reasons for that. First, it means the money is in my ISA and ready to invest so I do not need to remember to do that in April. By that time I may have other things on my mind.
Secondly, I would avoid the peak period for ISA providers in April when their service times may slow down due to high demand.
Thirdly, if I have spare money now, putting it in a Stocks and Shares ISA means I can put it to work in the market instead of giving into the temptation of spending it elsewhere. Come April, I may have other demands on my spare cash!
Getting going with an ISA
So what specifically would I do? If I did not already have on, I would choose the Stocks and Shares ISA that looked right for my own circumstances.
There are lots of options and people have their own investment needs.
For example, if I expect to buy and sell rarely (which, as a long-term investor, I do) then higher trading fees per transaction might not bother me so much in the grand scheme of things. But if I expected to be more regularly active in the market, per-transaction fees might seem more important to me.
Even with £800, I would seek to apply the right investment principles. For example, diversification is a simple yet common risk management strategy. £800 would let me diversify across a few different shares in my ISA.
Doing something now, rather than later
That said, the April deadline is not about buying shares – it is about putting money into the ISA within a given tax year.
Similarly, just because I set aside £800 today and put it into a Stocks and Shares ISA, does not mean that I would need to make any investment choices just yet.
As it happens though, I can see a number of FTSE 100 shares I think look like bargains right now. I would happily add such shares to my ISA if I had spare cash to invest, from Vodafone to M&G.
I could be wrong, of course. Sometimes a share that looks like a bargain turns out to be a value trap. That explains why I always keep my ISA diversified.
But if I had £800 to put to work in a Stocks and Shares ISA right now, I think I could easily do so in this market!
