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Want to make a million? Forget Cash ISAs and stick with stock investing!

Are you a long-time investor in a Stocks and Shares ISA? Do you wonder why you haven’t joined the growing number of people who are making a million from their investments?

It can be frustrating to see the returns from your share portfolio fall short of what you’d been expecting. And it’s particularly galling when you read or hear about how others are making an absolute fortune from stock investing. Even the best of us have regrets and have made some colossal mistakes. Just ask Warren Buffett how he felt following his disastrous liaison with Tesco shares a few years back.

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10% returns

But it’s critical not to throw in the towel. If you’re not making decent returns with your stock-buying strategy then it’s clear that the problem is with your strategy, not the market. Perhaps with a little bit of bad luck thrown in.

By far, share investing is one of the best methods for individuals to realise life-changing returns, as study after study has shown. Largely speaking, equity investors can expect to make returns of between 8% and 10% per year over the long term. Getting to that magic £1m marker might require some homework and no little discipline, but it’s not an unreasonable expectation.

It’s never too late

For many people, their 20s can prove to be an expensive time. Big tuition fees. Going out. Travelling the world. Saving up an enormous deposit to buy a home. It’s hard to build up a nest egg during that time, and many people by the age or 30 have little or nothing in the way of savings.

Let’s say that you fall into that category. It’s still not too late to try and make a million from the stock market. Big bills may have been switched out for other large expenditures (like childcare costs) by the time you reach your 30s. But progression on the career ladder might give you a heavier pay packet with which to invest.

Do the maths

So how much would someone who’s just turned 30 have to squirrel away in a Stocks and Shares ISA in order to make a million? Well, let’s take that 8% to 10% annual returns range that I used earlier.

Someone who wishes to retire at the age of 65 with a million in the bank would need to have invested around £300 per month in stocks. To be precise, this sort of outlay could have made them a whopping £1,019,637.30 over the space of three-and-a-half decades.

Let’s say that this person had stashed that £300 per month over the past 35 years into a Cash ISA instead. The best-paying of these easy-access accounts is the 1.25% offered by Aldermore, according to, so let’s use this. How much would this have left them with? £157,751.76, some way short of that magic million.

If you want to make that sort of return from stock markets you’ll probably need to fine-tune your investment strategy, but it can be done. Just ask those aforementioned ISA millionaires! And there’s plenty of help out there to push you towards that fortune too.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended and Tesco. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.