The new tax year in the UK is officially here. If you are an investor, you might be looking to take advantage of your new £20,000 ISA allowance by adding a fresh batch of stocks to your current portfolio.

While everyone has a different strategy for picking stocks, keeping an eye on what other investors are buying can be quite useful when it comes to making decisions. In this article, I’ll tell you the stocks that have been most popular among UK investors so far this year.

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Which have been the most popular stocks in 2022?

According to data published by financial data website Moneyfacts.co.uk, Tesla Inc., the electric car manufacturer, was the most popular stock among UK investors on the eToro trading platform in Q1 2022. The company was also the top choice among global investors in Q1.

In second place was another car maker, Nio Inc. E-commerce giant Amazon took third. Apple Inc. was the fourth most popular choice, while ‘meme’ stock GameStop Corp closed out the top five.

The top ten list is dominated by US stocks, with the only UK stocks making the cut being jet engine maker Rolls-Royce and low-cost airline group EasyJet.

Here is a complete list of the 10 most popular stocks among UK investors on eToro, as revealed by Moneyfacts:

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How can you invest in these top 10 stocks?

If you are interested in investing in any of these top stock options, the most tax-efficient way to do so is through a stocks and shares ISA. This is basically a government-approved tax wrapper that can be put around a wide range of investments, including shares, investment funds and trusts. Every year, you get an allowance of £20,000 to invest in a stocks and shares ISA.

The main advantage of an ISA is that any gains, interest or dividends earned from your investments are tax free.

Stocks and shares ISAs are available from a variety of providers, including banks, building societies, stockbrokers and asset management firms. Be sure to compare various options to find the one that is best suited to your needs and circumstances.

To make this process easier, we’ve compiled a list of some of the top-rated stocks and shares ISAs in the UK right now.

Is it better to invest at the start of the tax year or later?

Taking advantage of your ISA allowance by investing at the start of the tax year is always more advantageous than waiting until later in the tax year.

You are more likely to make better investing decisions when you have more time on your hands, such as at the beginning of the tax year, rather than at the end, when you may be racing against the clock to use your allowance before it expires.

Furthermore, investing at the start of the tax year allows you to get the most out of your investments. You’ll have a full year for the investments to work and earn you tax-free returns.

If you cannot invest the entire £20,000 in one lump sum, you can phase out your investment contributions over the tax year. This can help ensure you use your full ISA allowance by the end of the tax year.

What else do you need to know about investing in stocks?

If you’re looking to invest in some of the most popular stocks on the market, there are a couple of other things to keep in mind.

First, it’s important to do your own research and thoroughly assess the risks involved. Don’t just buy stocks because they’re popular with other investors.

Have a clear idea of your investment goals, and make sure that the stocks you’re considering not only have potential but also align with those goals.

It’s also a good idea to diversify your portfolio so that you don’t put all of your eggs in one basket. This can help you avoid losing money in the event that one of your stock picks underperforms.

The post The 10 most popular stocks among UK investors so far this year appeared first on The Motley Fool UK.

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Special purpose acquisition companies (SPACs) are a relatively new phenomenon in the UK, but they’ve grown in popularity over the last two years. Now, the London Stock Exchange (LSE) is getting ready to welcome its newest SPAC company.

Financials Acquisition Corp, a UK SPAC that focuses on insurance technology, has announced plans for a £150 million listing on the LSE. Here’s everything you need to know about this planned SPAC listing, including whether you can invest in it.

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New SPAC to list on the LSE: what do you need to know?

Financials Acquisition Corp plans to float 15 million shares at a price of £10 per share to raise £150 million.

The company will then seek to merge with a technology-enabled company or business that operates in or is related to the insurance or broader financial services industry.

According to the SPAC, “The companies being considered for a business combination by Financials Acquisition Corp must have the potential for sustainable advantage beyond short-term growth, significant bottom-line growth, a strong management team with a solid track record of value creation who are ready for public markets, as well as operating in parts of the insurance value chain where technology offers a structural operating and/or distribution advantage.”

The listing’s sponsor is FINSAC LLP. This is a limited liability partnership founded by experienced insurance and financial services executives William Allen and Andrew Rear.

FINSAC also has the backing of certain institutional strategic investors and industry experts.

How do SPACs work?

SPACs do not operate their own businesses. Instead, they are formed solely for the purpose of acquiring or merging with an existing company.

A SPAC raises funds through an initial public offering (IPO). The SPAC then uses the money to fund a merger or the acquisition of a target private company.

Once the merger or acquisition happens, the new company begins trading on the stock market under its new name. A SPAC, in essence, provides a faster and smoother path for private companies to go public.

The UK could become a more attractive destination for SPACs in the future, following a revision of SPAC listing rules by the FCA. Recent rule changes that could entice more SPACs to list in the UK include:

• Lowering of the minimum size threshold of money raised from third-party investors when a SPAC’s shares are first listed from £200 million to £100 million.

• Removal of the suspension of trading in a SPAC’s shares upon the announcement of a potential merger or acquisition.

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Can you invest in a SPAC?

Once a SPAC is listed, investors can buy its shares in the same way as shares of any other publicly-traded company.

One easy and fast way to buy shares is through a top-rated share dealing account.

However, if you plan to invest an amount less than £20,000, consider investing via a stocks and shares ISA. The main advantage of a stocks and shares ISA is that your investment returns are typically free from tax. Check out our list of top-rated stocks and shares ISAs in the UK to see if you can find one suitable for your needs.

What do you need to know before investing in a SPAC?

SPACs are still a relatively new phenomenon, despite their growing popularity.

Remember that a SPAC has no business of its own. Consequently, there are no business performance metrics you can analyse to determine whether the entity has any long-term potential.

When you invest in a SPAC, you are essentially betting on the expertise of the SPAC’s sponsor and management to lead it to a merger or acquisition that will result in a profitable return on your investment.

So, before you invest, do your homework and make sure you are comfortable with the risks involved.

The post New SPAC set to float in London: can you buy its shares? appeared first on The Motley Fool UK.

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The average UK investor, when given the choice, would prefer that their investments tackle social challenges over environmental ones. This is according to a new study by Big Society Capital that examines investors’ preferences for responsible causes.

Here’s a quick rundown of the study’s findings, as well as a look at whether impact investing can be profitable.

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Impact investing: what does the research show?

In its study on impact investing, Big Society Capital asked participants to choose three options from a list of social and environmental causes.

More than half (57%) of under-45s chose social impact investments of different types over environmental impact investments. The preference for social over environmental investments was found to be even greater among younger investors. Some 67% of those under 25 chose social over environmental impact investments.

Health and wellbeing, in particular, got the most interest among investors between the ages of 18 and 24. Almost four in ten (39%) said that they would choose to invest their money in this area.

The study found that as investors get older, their concern for environmental factors tends to rise. For example, 57% of those aged 55 and up want to invest in environmental protection, compared to 42% of those aged 25 to 34.

Commenting on these findings, James Westhead, head of engagement at Big Society Capital, said: “The interest in social impact investing is really encouraging as it has a huge role to play in supporting charities and social enterprises that provide essential services across the country, as well as contributing to the levelling up of the economy. 

“Now is the time to capitalise on the huge social benefits that social impact investing can bring.”

Is impact investing profitable?

For a long time, the myth has been that investors have to choose between a positive impact and financial returns. One of the arguments for this belief is that impact investments cannot be scaled sufficiently to generate good returns.

However, new research has dispelled this myth. The data shows that impact investments can perform just as well, if not better than conventional investments.

In a survey by the Impact Investing Institute, for example, 90% of respondents with impact investments reported that their returns in 2020 were either in line with or exceeded their targets.

And, in the GIIN’s 2020 Annual Impact Investor Survey, 88% of respondents reported that their portfolio performance met or exceeded their financial return expectations.

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How can you get started with impact or sustainable investing?

If you want to make a positive social or environmental impact, then it’s quite easy to get started with impact investing.

All you need is a trading platform that gives you access to these kinds of investments. There are several such platforms in the UK. Most have tools you can use to screen available investment options, such as funds and shares, to find those that meet your impact investing goals or criteria.

Once you’ve decided on a platform, consider investing through a stocks and shares ISA. Any returns from investments in a stocks and shares ISA are tax free. This can make a big difference to your total investment returns over the long term.

If you want to learn more, check out our comparison of some of the top-rated stocks and shares ISA providers in the UK.

The post Impact investing: investors prioritise social factors over environmental ones appeared first on The Motley Fool UK.

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Credit scores are meant to be a reliable way of assessing how likely someone is to repay a debt. Lenders use them to determine whether to give you credit and, if so, how much interest to charge. But could the current credit score system be flawed?

According to a new study, close to half of Brits believe the current credit score system isn’t fit for purpose. Let’s take a look at why this is the case, whether the current credit score system needs to change and what you can do to take control of your financial future.

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Credit score system: what do Brits think about it?

According to a MyLifeKit and Censuswide poll, 54% of British adults aged 18 to 34 believe the current credit score system is fundamentally flawed. A sizable proportion (44%) of respondents aged 35 and up also share the sentiment.

Overall, 46% of adult Brits agree that the current credit score system is ineffective.

Why do Brits think the credit score system is flawed?

According to the study, 39% of respondents think it’s unfair that their credit scores are used to judge them based on financial decisions they made up to five years ago.

Meanwhile, 38% believe that their credit scores do not accurately reflect their current lifestyle or livelihood. Credit scores, according to 34% of people, are not an accurate reflection of a person’s creditworthiness.

The fact that you receive a poor credit score if you have a limited credit history is one big reason that the credit score system is considered flawed, according to 36% of respondents.

Is it time to overhaul the current credit score system?

Romano Toscano, CEO and founder of MyLifeKit, questions whether it’s actually fair to judge people’s creditworthiness, and thus their eligibility for financial services, purely on financial history. In an age when enriched data about people is widely available, he believes that the current credit system should be rethought.

He explains, “We must start to see a shift in how financial, healthcare and retail industries deploy enriched data to determine an individual’s creditworthiness.”

“Said data could include context relating to their lifestyle, health, fitness and the wider environment and economy, all of which are already being tracked and observed by consumers and businesses already.”

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How can you take control of your financial future in the meantime?

There’s nothing much you can do as a consumer to change the current credit score system. Until the system is updated to take enriched data into account, many borrowers will continue to feel like the odds are stacked against them.

Right now, the best thing you can do is try to improve your credit score. This will help you take control of your financial future. Here are a few ideas to help you do that.

1. Get on the electoral register

Being on the electoral register allows lenders to verify who you are and where you live. This can have a positive effect on your credit score.

2. Pay your bills on time

Paying your bills in time will lead to a positive payment record that can help improve your score. It will also help you avoid late fees.

One of the best ways to make sure that your bills are paid on time is to set up automatic payments.

3. Keep your credit utilisation ratio low

Your credit utilisation ratio is the amount of your total available credit that you are using.

Lenders see a low credit utilisation ratio as a positive, and this can improve your score. As a rule of thumb, you should aim to keep your credit utilisation ratio below 30%. So, if you have £1,000 of credit available, aim to use no more than £300 of it.

4. Apply for a credit-builder card

A credit-builder card aims to help people with a limited credit history or low credit scores improve their situation. The card typically has a lower credit limit and a higher APR. However, it has lower eligibility requirements.

If you use the card and pay off the balance at the end of each month, you can show lenders that you are a responsible borrower. Your credit score should go up over time.

Does this sound like something that could work for you? Check out our list of top-rated credit cards for bad credit to get started.

5. Check your credit report regularly for any errors

Credit report errors could have a negative impact on your score. Make a habit of reviewing your report on a regular basis so that you can note and take steps to correct any errors.

The post Here’s why half of Brits believe the current credit score system is flawed appeared first on The Motley Fool UK.

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It’s been almost 23 years since the ISA was launched. Over this time, ISAs have helped millions of Brits invest in a tax-efficient way and build wealth.

But where have investors made the biggest returns over the lifetime of their ISAs? And more specifically, which funds and trusts have performed best since the launch of the ISA in 1999? 

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How has the average global fund performed since the ISA was launched?

It’s common knowledge that investing in stocks and shares carries some degree of risk. Negative market conditions could cause your investment to lose value, and you could get back less than you invest.

According to AJ Bell, there couldn’t have been a worse time to invest in stocks and shares than when the ISA was first launched in 1999.

The launch of the ISA preceded the infamous dot-com crash, which triggered a deep and prolonged bear market. The FTSE 100, the most popular stock market index in the UK, lost nearly half of its value in the three years after Christmas 1999. It would actually take the FTSE 100 fifteen years to regain its pre-dot-com crash level!

However, research from AJ Bell shows that early ISA investors who have not been discouraged by market upheavals and volatility and who have held onto their investments have experienced the healing power of time in the market.

The data reveals that £1,000 invested in the average global fund in 1999 would now be worth £3,875 or £2,435 after taking inflation into account.

Which ISA funds and trusts have performed the best since the ISA was launched?

AJ Bell has revealed the best performing investment funds and trusts since the ISA was launched.

Here’s how much £1,000 invested in these top-performing funds and trusts in 1999 would be worth now.

Best performing funds since April 1999

 

Best performing trusts since 1999

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Is it easy to benefit from a stocks and shares ISA?

If you had invested in these top-performing ISA funds or trusts in 1999, your money would have realised an annualised return of as much as 16.4%, as seen.

An extra benefit of investing via a stocks and shares ISA is that you don’t pay any tax on your money’s growth or dividends.

If you don’t have a stocks and shares ISA, it’s never too late to open one. The easiest and often the cheapest way to open this ISA is through an online investment platform.

There are numerous such platforms in the UK, each with its own set of advantages and disadvantages. Make sure to compare different options first to find the one that best suits your needs.

To help you with this task, we have compiled a list of some of the top-rated stocks and shares ISA providers in the UK.

Remember

Each year, you can invest up to £20,000 in an ISA completely tax free.

So, if you’ve not used any of your ISA allowance for this year, it means that you can possibly shelter as much as £40,000 of your money from tax between now and the end of the 2022/2023 tax year by opening a stocks and shares ISA and using this year’s allowance before the 5 April deadline.

The post Revealed! The best perfoming funds and trusts since ISAs began appeared first on The Motley Fool UK.

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Fortunately, there is a way for savers to safeguard their money against inflation. This is through a stocks and shares ISA. So, how exactly can a stocks and shares ISA help you beat inflation levels? Read on to find out. 

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What is a stocks and shares ISA?

A stocks and shares ISA is a tax-efficient account that lets you invest in a wide variety of investment products, including shares, investment funds and trusts. 

The primary advantage of a stocks and shares ISA is that any capital gains, dividends, or interest earned from your investments are tax-free.

There is, however, a limit to how much you can put in a stocks and shares ISA annually. This is known as the ISA allowance. For the current tax year, this allowance is £20,000.

How can a stocks and shares ISA help you beat inflation levels?

According to Saxo Markets, a stocks and shares ISA can help protect your money from the effects of inflation in two ways.

First, by investing in a stocks and shares ISA, you avoid being locked into any fixed interest rates, which is typically what happens when you put your money in a cash ISA, for example.

Simply put, the amount of returns from a stocks and shares ISA are not based on a fixed rate, but rather on how your investments perform and how much they are worth when you sell them.

If your investments perform well, there’s a chance that you could get inflation-beating returns. Indeed, over the long term, returns from investments have historically outperformed cash savings as well as inflation.

Second, investing in an ISA means that you have no tax to pay on any gains, dividends and interest from your investments. Basically, you get to keep more of your money.

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Is there a flipside?

Yes, there is, unfortunately.

With a cash ISA or a traditional savings account, your money is secure. You cannot lose it, though its value may be eroded if the interest you get is less than the rate of inflation.

Sadly, there is no such security with a stocks and shares ISA. Your investments may fluctuate due to adverse market conditions. You may actually get back less than you initially invest, particularly in the short term.

That’s why with a stocks and shares ISA, it’s best to leave your money invested for a number of years. A good rule of thumb is to invest for at least five years. This will allow your investments to ride out any market downturns.

You can also mitigate the risk of loss by making sure that your portfolio is well diversified. This entails investing across different sectors and countries, as well as different investment assets.

It’s highly unlikely that all sectors, countries or investment assets will perform poorly at the same time. If one category incurs losses, these losses will be offset by gains in another category. This will reduce the overall risk of your portfolio underperforming or losing money. 

How can you open a stocks and shares ISA?

Stocks and shares ISAs are available from a vast array of providers. These include banks, building societies, stockbrokers and fund management companies.

Every provider has its own pros and cons. Therefore, make sure you compare different options first to find out the most suitable one for your needs and circumstances. To help you with this task, The Motley Fool has compiled a list of some of the top-rated stocks and shares ISA providers in the UK right now.

As always, before you put your money into any investment, make sure you thoroughly research it to see if it has good long-term potential.

If you don’t have the time or the inclination to research your own investments, you can always sign up with a top-rated robo-advisor that will create a personalised stocks and shares ISA portfolio for you based on your preferences and risk tolerance.

The post How a stocks and shares ISA could help you beat inflation levels appeared first on The Motley Fool UK.

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The tax burden on UK consumers is set to rise sharply from 6 April through a combination of freezes on personal allowances and increases in National Insurance and Dividend Tax rates. This means that it is now more important than ever to take advantage of your annual ISA allowance.

An ISA can protect your money not just from the taxman but also from the effects of inflation, which has recently hit a high of 6.2%.

If you have an ISA or are considering opening one, leading online trading and investment platform Saxo Markets has six simple but very useful tips to help boost your ISA returns for a more secure financial future.

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1. Just open an account

According to Saxo Markets, you do not need to decide on your investments right now in order to secure your £20,000 annual ISA allowance. You can open an ISA, keep your funds in cash, and then return once you’ve decided how to invest.

This can help you avoid losing your annual allowance (which you will if you don’t use it since it doesn’t roll over).

It’s also worth mentioning that with investment ISAs, you don’t have to research or pick your own investments if you don’t want to. Instead, you can sign up with a robo-advisor who will build you a personalised ISA portfolio based on your goals and risk tolerance.

Check out our comparison of some of the top-rated robo-advisors in the UK right now to learn more.

2. Contribute regularly

When it comes to using an ISA to save or invest, you don’t need a large sum to get started. You don’t have to put the full £20,000 into an ISA all at once, for example. Instead, you can make small contributions throughout the year. Smaller contributions will still help your savings grow.

Furthermore, contributing a set amount on a regular basis to a stocks and shares ISA can help take the stress out of natural stock market fluctuations.

As Saxo Markets points out, the value of investments fluctuates in the short term. But by making regular contributions, you can avoid the risk of putting all your money in at once, say, just before a big drop.

Most stocks and shares ISA providers, including the Saxo Markets Stocks and Shares ISA, will actually allow you to set up an automatic plan to make regular contributions. Alternatively, you can make your own contributions on a fixed schedule.

3. Take appropriate risks

In the current environment of low-interest rates and high inflation, people holding their savings in a cash ISA risk seeing their money lose value in real terms.

If you can afford to lock your money away for a significant period of time – say, five years – consider investing a portion of it in the stock market through a stocks and shares ISA.

Stocks, while riskier than cash savings, have historically delivered higher returns that beat inflation, particularly over the long term. To learn more, check out our list of top-rated stocks and shares ISA providers in the UK.

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4. Practice diversification

If you decide to invest in a stocks and shares ISA, make sure you don’t put all of your eggs in one basket by practising diversification. This entails investing across a range of countries and sectors, as well as various asset types such as stocks and shares, government bonds and commodities.

This will help ensure that your portfolio is able to ride out any market downturn in a specific asset class, sector or region of the world.

5. Review your old ISAs

ISAs have been around for almost 23 years. It’s possible that you have an old ISA that you might have forgotten about or that you no longer keep tabs on. Your old cash ISA might be providing below-market returns, or your stocks and shares ISA might not be in the right funds for your circumstances.

With this in mind, it may be worth reviewing these old ISAs and, if necessary, transferring them to a new provider to get a better deal.

Don’t withdraw the money, however, as you will lose the ISA tax benefits. Instead, ask your new provider to arrange the transfer.

6. Re-invest your dividends

Part of the beauty of investing via an ISA is that dividends from your investments are not subject to tax. But if you don’t need the money right away, you can reinvest it back into your ISA. This will help your pot grow even more in the long run.

That’s because each time you reinvest your dividends in your portfolio, you’ll receive even more dividends in the next dividend payout. You can then reinvest these dividends into your ISA again, with the cycle continuing indefinitely.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

The post Six simple tips to boost your ISA returns this year appeared first on The Motley Fool UK.

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Stock markets around the world have been struggling since the turn of the year. In the UK, the FTSE 100 is down 4% from its January peak, and across the Atlantic in the US, the flagship S&P 500 has fallen 13% since the beginning of the year. Speculation is rife that even more stock market drops could be on the way.

However, according to new research from personal finance comparison website Finder.com, many UK investors actually see the drop as a buying opportunity and are planning to top up their portfolios with more stocks. But is ‘buying the dip’ a good idea? Let’s find out.

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Why are stock markets struggling?

One of the contributing factors is the current conflict in Ukraine, which has created unease and uncertainty among investors.

Investors are also concerned about the prospect of rising interest rates and potentially tighter monetary policies. Here in the UK, the Bank of England is expected to raise interest rates soon to combat inflation, which has recently reached a 30-year high of 5.5%.

A rise in interest rates means higher borrowing costs for businesses, which may have a negative impact on their stock prices.

Will stock markets fall even further?

Of course, nobody has a crystal ball. But there are growing concerns that a full-blown stock market crash could be on the way.

One expert has suggested that the S&P 500 could fall by as much as 80% this year. We’ll have to wait and see if that actually happens.

In the meantime, Finder has created a live chart for S&P 500 investors to compare how the current drop compares to previous crashes in the last 50 years, such as the 1973/74 crash, the dot-com bubble (2000-2002), and the financial crisis (2007-2009).

The chart shows that the worst stock market crash in the last 50 years occurred during the financial crisis of 2007-2009 when the S&P fell by 55.5% after 351 days. If the current drop in the S&P 500 is to become the worst crash in history, it clearly has a long way to go.

How are investors reacting?

According to a new study from Finder, half (48%) of UK investors say they are planning to ‘buy the dip’.

A further 4% of Brits who don’t invest are also planning to buy stocks during the dip. This means that about one in eight Brits (12%), or approximately 6.2 million people in total, intend to ‘buy the dip.’

The research also shows that the younger Brits are, the more likely they are to ‘buy the dip’. Almost one in six young people aged 18-24 are planning to buy the dip, compared to less than one in 10 of those aged 65 and up.

More men than women also plan to buy the drop (15% vs 8%).

Not all Brits plan to invest under current conditions, however. Some 80% of Brits don’t currently invest and won’t be tempted to start by the current dip. And 52% of current investors are not planning to buy any more stocks just because of the current market drop.

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Is ‘buying the dip’ a good idea?

A stock market drop can provide investors with an opportunity to buy additional stocks for their portfolios at a reduced price. But this strategy could also be counterproductive.

Finder.com’s Investing Writer, Zoe Stabler, explains: “It can seem tempting to invest when markets are dropping, but there is no telling when a market crash will end, and you could end up experiencing heavy losses early on if it continues to fall.”

Rather than trying to time the market, which is basically what investors are doing by ‘buying the dip’, Stabler advises that investors should pursue long-term investment strategies.

For example, a much better strategy for investors who are looking to get more value for their money when buying stocks is what is called ‘dollar-cost averaging’.

This is where you invest a set amount of money in stocks at predetermined intervals over time. Most top-rated share-trading accounts and stocks and shares ISAs allow you to set up an automatic plan to buy at regular intervals. Alternatively, you can make your own purchases on a fixed schedule (say, on the first of every month).

By buying stocks at various prices on a regular basis, you increase your chances of paying a lower overall average price for them than you would if you tried to buy them when you think the price is just right, such as during a dip, which could end up working against you.

As Stabler explains, this in theory “means that you aren’t putting all your eggs in one basket and you are likely to end up investing at good times as well as bad times”.

The post Half of UK investors plan to ‘buy the dip’: is this a good idea? appeared first on The Motley Fool UK.

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• Prediction: Diageo shares could soar in the next 5 years if this happens…

For a long time, sustainability issues have been of secondary concern to investors. The primary goal for many has been to maximise investment returns. However, over the last few years, more investors have become interested in sustainable investing. This is an approach that takes into account environmental, social, and governance (ESG) factors when choosing investments.

According to new research, the passion for sustainable investing has grown so much, particularly among new investors, that many are now demanding greater sustainability expertise from their fund managers to ensure that they are actually investing with a positive impact. Here’s the lowdown.

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Investors and sustainability: what does the research show?

According to a new study by Triodos Bank UK, eight in 10 current investors (rising to nine in 10 for new investors, who have started investing in the last 12 months) want or expect their fund manager to upskill in sustainability issues to avoid greenwashing accusations from financial providers.

Investors also want their managers to be proactive in aligning with their sustainability values.

For example, eight in 10 existing investors (rising to 9 in 10 new investors) expect or want to see their fund managers divest from harmful investments and challenge companies directly on sustainability.

What’s behind the increased push for sustainability?

The focus on sustainability could be to do with world events and ongoing coverage of the climate crisis.

For example, 56% of new investors say COP26 has made them think more about how their investments impact the environment.

Passion for sustainable investing has grown so much that 60% of new investors actually believe financial institutions should only offer sustainable investment ISAs. Meanwhile, 78% believe that financial providers should do more to help combat the climate crisis.

Michael Kind, senior campaigns manager at ShareAction, says that it’s not surprising “to see increasing numbers of retail investors understand the impact of their money on the world, and to recognise that impact on people and the planet is just as important as returns”.

He added, “A true responsible investor sees negative impacts as just as important as financial return, and takes steps to mitigate or avoid these impacts.”

Indeed, as a true testament to their desire to make a positive difference in the world, six in 10 new investors (63%) say they would be willing to accept lower returns in order to invest in industries they believe in.

However, recent data shows that investors don’t actually have to sacrifice returns when pursuing sustainable investing. According to Refinitiv, ESG funds have outperformed conventional funds returns-wise over the past three to five years. 

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How can investors get started with sustainable investing?

If you are an investor hoping to get started with sustainable investing, it’s relatively easy to do. All you need is a share dealing account. Check out our list of top-rated share dealing accounts to see if you can find one that meets your needs.

After you’ve opened your account, you’ll be able to choose from a variety of investment options. You can choose to invest in individual shares of companies whose values align with yours. You can also choose to invest in funds that invest their money in these companies. Many brokers provide tools that you can use to screen the funds available and find those that match your values.

Another way to invest in sustainable investments is through a stocks and shares ISA. The benefit of a stocks and shares ISA is that you do not pay tax on your returns. This means that you get to keep more of your money. Check out our reviews of some of the top-rated stocks and share ISAs in the UK right now to learn more.

Finally, keep in mind that when it comes to investing, there are no guarantees of positive returns. Your investments can go up or down, and you may end up with less than you put in. So, do your research and only invest at a risk level that you are comfortable with.

The post Investors are demanding greater sustainability expertise from fund managers: here’s why appeared first on The Motley Fool UK.

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It’s normal to carry credit card debt once in a while. But if you are paying too much interest on your debt, it might be time to look into a balance transfer credit card. This type of card allows you to transfer one or more balances from your existing credit cards to a single card with a lower or even a 0% interest rate.

In this article, I’ll tell why now might be the best time to apply for a balance transfer credit card.

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How do balance transfer credit cards work?

When you transfer your credit card balance to a balance transfer credit card, you will be offered an introductory 0% interest period lasting a number of months. That means that there will be no interest to pay on your debt for this period.

If you are paying a high interest rate on your current credit card debt, you could potentially save hundreds or even thousands of pounds in interest.

Check out our balance transfer calculator to find out how much money you could actually save by transferring your debt to a balance transfer credit card.

The length of the 0% introductory period varies from card to card. But for most balance transfer cards, the time is usually more than enough to clear your debt.

Why is now a great time to apply for a balance transfer card?

According to a recent report by Moneyfacts, balance transfer credit card deals have become more attractive recently with longer 0% interest periods.

Moneyfacts reports that the average interest-free term has surpassed 600 days for the first time since 2008. The average interest-free period on balance transfers is now 602 days. This is up from 577 days in December and 530 days this time last year.

Balance transfers have also become cheaper. According to Moneyfacts, balance transfer fees have dropped from an average of 2.23% a year ago to 1.95% right now. This is the lowest level since 2006.

Furthermore, the number of balance transfer deals has also increased (after falling to a record low in 2020).

There are currently 68 balance transfer deals on the market with an interest-free introductory period. There are also 62 deals with an interest-free period on purchases.

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What else do you need to know about applying for a balance transfer credit card?

When it comes to applying for a balance transfer credit card, make sure you shop around and compare different options. This will increase your chances of finding the best deal for your needs. The Motley Fool has compiled a list of top-rated balance transfer credit cards available in the UK right now to help you with this.

Keep in mind that lenders are only required to offer the headline rate to at least 51% of applicants. So, if you apply for a balance transfer credit card, you are not guaranteed to receive the longest 0% term advertised.

In some cases, it may be preferable to avoid the longest 0% period. Cards with longer 0% periods typically come with higher balance transfer fees. So, if you don’t require 33 months (the market’s longest 0% period) to pay off your balance, choosing a card with a shorter 0% period can help you avoid higher fees.

Finally, remember that any credit application will result in a hard credit search on your credit report. This may lower your credit score. If you have a high number of declined applications, it may make you less attractive to lenders. This could reduce your chances of getting credit in the future.

By using The Motley Fool’s eligibility checker, you can find out your chances of being accepted for a balance transfer credit card before you apply. This won’t affect your credit score. More importantly, it could help you minimise the number of declined applications that could affect your ability to get credit in the future.

The post Why NOW is the best time to apply for a balance transfer credit card appeared first on The Motley Fool UK.

More reading

• £5,000 invested in Aviva shares 6 years ago is now worth…
• Why I think the HSBC share price could hit 2,000p by December
• £15,000 invested in UK shares a decade ago is now worth…
• 3 FTSE shares with many years of consecutive dividend growth
• Prediction: Diageo shares could soar in the next 5 years if this happens…