You only have until 5 April to use up as much as your 2018-19 ISA allowance as you can. So what should be on your urgent to-do list?
If you’ve already used up all that you’re going to of this year’s total, then you need to do absolutely nothing. By the time you have more cash to invest, we’ll be into the 2019-20 allowance, and you can start using that.
But wait. Are you sure there isn’t a bit more cash lying around somewhere that you could add to the pot? Another £100 you could spare, perhaps? Or even just a few tens of pounds?
No rush
A sum like that is nowhere near enough to justify paying share dealing charges to invest, you might say. But that’s not a problem. All you have to do to beat the deadline and have it count as part of this year’s allocation is to get the cash transferred in — you don’t have to actually invest it in shares by 5 April.
Although a Stocks and Shares ISA isn’t supposed to be for investing cash, it’s fine to keep small amounts lying around until you have sufficient for a share investment — it’s how people deal with dividends, for example. So you have no excuse for not paying in those extra few quid!
But what if you really do have some cash accumulated for investing in shares and it’s not in your ISA yet? Well, getting it in before the deadline is easy. All the ISA providers I’ve examined let you transfer cash directly either using bank account details or a debit card (which you’ll already have set up when you opened the account).
What’s the difference?
If you don’t come close to your annual ISA limit, you might not think it makes much difference whether your latest accumulation of cash goes into this year’s or next year’s allowance. And you might not see any urgency in getting it transferred before the end of next Friday.
In most cases, you’re probably right. But you don’t know what’s ahead, or what good fortunes you might enjoy next year. I know someone who was once bequeathed a sum of exactly £20,000, which they didn’t expect. The maximum possible went into an ISA (it was a few years ago, before the limit had reached £20,000). But what if something like that happens to you later this year and you’re limited by having let last year’s investment cash carry over into the new year’s allowance?
Nothing to lose
If you have any ISA investment cash ready, I say get it into this year’s ISA as soon as you can. Even if you can’t otherwise use all of next year’s allowance, there’s no downside to getting the cash into this year’s — and keep as much of the new allowance as possible, in case of any windfalls.
And for those who do use up all of their ISA allowance in a Stocks and Shares ISA every year, well, I doubt there’s anything I can teach you.
Oh, one final point. You might note I haven’t mentioned cash ISAs here. A cash ISA is an utter waste of money, in my view, and you can read my take on it here.
