The Motley Fool

Forget buy-to-let! I’d invest £10k in cheap UK shares in an ISA today to retire early

The prospects for buy-to-let may appear to be better than UK shares, at first glance. The government’s stamp duty holiday (and other support schemes) may help provide growth for house prices in the short run. That is an appealing idea while a second market crash looms over the FTSE 100 and FTSE 250.

However, the bargain status of many stocks, the ability to reduce your tax bill, and the prospect of being able to invest more modest amounts than through buy-to-let, could mean now’s the right time to invest £10k, or any other amount, in the stock market. Over time, doing so could help you to retire early.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Cheap UK shares

After the recent market crash, there are many cheap UK shares on offer across a wide variety of sectors. Buying them today could allow you to obtain an even greater rate of return than the stock market’s long-term average, since you may benefit to a great extent from its recovery potential.

For example, investors who purchased FTSE 100 shares following the index’s long history of bear markets benefitted from the stock market’s low prices. After every market crash, it’s always gone on to record new all-time highs. That prospect may seem unlikely at present, due to risks such as a continued rise in coronavirus cases. But, in the coming years, fiscal and monetary policy stimulus have the potential to significantly raise the valuations of high-quality businesses.

By contrast, house prices lack margins of safety compared to UK shares. Affordability concerns may be eased by government support schemes, such as the stamp duty holiday. However, the fundamentals of the housing market appear to be relatively weak. Indeed, they’re not currently fully reflected in house prices. Therefore, returns for buy-to-let investors may be somewhat disappointing compared to those of FTSE 100 and FTSE 250 shares.


Investing in UK shares is a more accessible strategy than undertaking a buy-to-let investment. An investor can buy relatively small amounts of stocks to benefit from the stock market’s growth prospects. However, a large deposit is required to buy just one property. This may mean that many landlords’ portfolios lack diversification.

Furthermore, with products such as a Stocks and Shares ISA being simple and cheap to open, shares offer greater tax efficiency than buy-to-let investments. Over time, this could mean that their net returns are significantly higher than those on offer from within the property sector. Especially as many government schemes are temporary in nature.

UK shares have greater tax efficiency, accessibility, and value for money than buy-to-let investments. They could prove to be a better means of building a retirement nest egg. And they may help to bring your retirement date a step closer as the stock market gradually recovers from its recent market crash.

A Top Share with Enormous Growth Potential

Savvy investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!).

Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge!

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.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.