Then it took a sharp (but short-lived) dive. After recovering, it climbed to new highs but by the early 2000s, things were looking shakey. 

Within two years, it had lost almost 50% of its value.

Recent activity is mirroring those days — speculative tech hype has driven the index up over 100% since the pandemic. Recently, it took a sharp dive into correction territory before making a quick recovery.

When looking at a long-term chart, the similarities are jarring. Are we on course for a repeat of the early 2000s?

Not exactly…

Just because charts correlate, doesn’t mean markets are the same. The key similarity is overhyped tech optimism — back then it was internet startups, now it’s AI.

Valuations look stretched in growth areas, and sentiment feels euphoric at times. But the differences are big. Geopolitics is messier today, with Middle East tensions and trade rows, unlike the relative calm of the 90s.

UK companies are more global and dividend-focused, not pure tech plays. And central banks are quicker to step in with rate cuts.

But while history may repeat itself, past performance is no indication of future results. Even if shares dip sharply, crashes can present opportunities for long-term investors. The trick is to be ready to pounce before the market recovers.

How UK investors can prepare

There’s never any reason to panic, even if a crash looks inevitable. These things happen, they’re normal, and in the long run, they balance out.

However, it pays to err on the side of caution. In times like these, I tend to reduce speculative positions (like AI bets) and weigh more heavily into defensive stocks (healthcare, utilities). With more stable revenues and share prices, these types of stocks can help limit losses.

Plus, it never hurts to keep some cash on the sidelines to snap up bargains.

What are UK defensive shares?

A good example to consider is National Grid (LSE: NG.), the utility giant that runs the UK’s electricity and gas networks. It’s as defensive as they come — people need power no matter what the economy does.

The shares trade around 1,340p, with a forward yield near 3.5% and full-year dividend of 47p. With a payout ratio of 80%, coverage isn’t great, but it typically aims to beat inflation.

The latest results show steady revenue, helped by regulated returns from both UK and US operations. With Bank of England rates expected to ease slightly in 2026, borrowing costs should fall, supporting profits. 

Its valuation looks moderate, at about 23 times earnings, suggesting its trading at a fair price.

But still, risks exist. Debt’s skyrocketed lately as a result of grid upgrades, which could become a problem if rates stay high. Meanwhile, stricter regulations or green energy shifts could impact profits in the short-term.

The bottom line

Stock market crashes are inevitable but notoriously difficult to predict. Being prepared can reduce the chance of panicking and making rash decisions.

Defensive shares can feel like holding cash in low-growth positions but, over the long run, the risk reduction can make a big difference. And this isn’t the only one I’ve explored lately…

The post The FTSE 100 looks a lot like the late ’90s. Are we heading for a 2000-style crash? appeared first on The Motley Fool UK.

But it’s not just about income. The share price has also risen around 58%, taking the total return to roughly £9,560 – equivalent to an annual return of 14%.

That’s the part many investors overlook. So-called income stocks aren’t just about yield — they can quietly build substantial wealth over time through a combination of dividends and steady capital growth.

The real question now is whether the stock can continue delivering that same compounding over the next five years.

Mispriced stock

What’s interesting about National Grid right now is not what the business is, but how the market is still pricing it.

For much of the past few years, sentiment has been shaped by higher interest rates. As bond yields rose, investors increasingly treated utilities as bond proxies, leaving the shares anchored to a ‘low growth, high income’ perception.

But that framing is starting to look outdated.

Electricity demand is no longer stable — it’s accelerating in ways many investors are still underestimating.

AI data centres are a clear example. They’re not just adding incremental demand; they’re creating concentrated spikes in electricity usage that existing grid infrastructure wasn’t designed to handle. In many regions, the constraint is no longer generation, but transmission capacity.

That matters because grid operators sit directly on that bottleneck.

Capital expenditure is shifting away from routine upgrades. It’s now driven by demand-led expansion and structural capacity shortages rather than regulatory cycles alone.

Electrification of transport and heating is adding further pressure. EV adoption and industrial electrification are accelerating the shift onto the grid.

Taken together, this creates a very different backdrop from the ‘slow utility’ narrative the market still leans on.

Risks

As a heavily regulated utility, the company’s returns are ultimately set through negotiations with policymakers. If outcomes are less favourable than expected, allowed returns could fall, impacting earnings and shareholder value.

This is amplified by the group’s large, capex-heavy investment programme, which is funded in part through leverage. Higher interest rates or weaker regulatory settlements could therefore pressure both the balance sheet and long-term returns.

What’s the verdict?

What ultimately matters for National Grid is not short-term sentiment, but the steady expansion of its regulated asset base — the capital it’s allowed to earn returns on.

Every pound invested into upgrading and expanding the grid is added to this asset base, and regulators then set returns on that growing pool of capital. In other words, the more efficiently it invests in essential infrastructure, the larger its earnings base becomes over time.

This is why demand matters so much. Rising electricity usage from AI, electrification and data centres is not just a volume story. It directly drives more grid investment and grows the asset base, which supports long-term cash flows.

In its latest year, the regulated asset base grew at around 10%, highlighting the strength of this compounding mechanism even in a higher-rate environment.

It’s this combination of visibility, inflation linkage and structural demand growth that drives my view. The market still underestimates the long-term income potential. That is why I recently added it to my position.

The post £5,000 invested in National Grid shares 5 years ago is now worth… appeared first on The Motley Fool UK.

Here, I want to see how much a typical share investor would have made if they put £20k in an ISA 12 months ago.

Winners and losers

Okay, let me clarify something straight away: there is no such thing as a ‘typical’ investor. Each of us has a different investing style, which influences what we buy on the stock market. More ambitious investors may have targeted large capital gains with growth stocks, for instance. Risk-averse share pickers may have preferred the comfort of income-paying dividend stocks like utilities, telecoms and banks. And the returns they enjoyed would have different accordingly.

Many shrewd investors would have enjoyed supersized gains with UK shares. There are 16 stocks on the FTSE 100 and FTSE 250 that have doubled in value or more in the last year. These include FTSE-listed Airtel Africa, Fresnillo and Lion Finance — these have risen 137%, 287% and 103%, respectively.

But then lots of stocks haven’t faired nearly as well. Many popular growth shares like Greggs and Sage have actually fallen over the last year.

Huge returns

With roughly 2,000 stocks just on the London stock market, there are many ways investors can target a target a juicy ISA return. And that’s excluding the many exchange-traded funds (ETFs) that track certain indexes or particular themes. So there’s no one universal answer as to what a £20,000 ISA would have returned over the last 12 months.

But what about someone took the simple option and bought two index trackers: one that followed the FTSE 100, and another that tracked the FTSE 250? They’d have made a pretty solid return, enjoying a return of 23% on the first and 13% on the other.

If our investor split a £20,000 investment equally across these trackers, they’d have £23,600 sitting in their ISA today.

What should investors buy today?

Investing in tracker funds could be another profitable play over the next year, too. But amid rising instability in the Middle East, choosing individual stocks to buy could be a better option to consider.

National Grid (LSE:NG.) is one stock from the FTSE 100 I feel deserves a close look. Like any share, it isn’t totally immune to events in Iran and the broader region. Surging energy prices could cause an inflationary shock, pushing up interest rates and driving borrowing costs northwards. Given the company’s high debts, this would be a problem.

Yet National Grid shares could still be a more stable pick than most. It operates in a highly defensive industry, generating reliable cash flows that underpin dividends. Speaking of which, the dividend yield here is an index-beating 3.9%.

The thing is, National Grid could be a great stock to consider for the long haul and not just these uncertain times. As the UK population expands and the green energy transition accelerates, it has significant growth potential in my view. In my view, it’s one of many top UK stocks to look into for the current ISA year.

The post £20,000 invested in the stock market a year ago is now worth… appeared first on The Motley Fool UK.

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.

Crunching the numbers

There are three factors that will influence the size of an ISA – the amount invested, the growth rate, and the length of time over which it’s held.

Of these, the annual growth rate is the one that’s most outside the control of the investor. However, as a benchmark, from 2016-2025, the FTSE 100 returned (with dividends reinvested) an average annual rate of 9.5%. According to IG, from its launch in 1984 to 2019, the index grew by 7.8%. The figure drops to 5.8% if dividends are excluded.  

Obviously, it’s better to invest for as long as possible. Little and often is a good philosophy.

When asked whether now is a good time to start, the answer is always likely to be yes. By taking a long-term view, timing the market becomes largely irrelevant.

So?

With this in mind, the table below shows how long it would take for a monthly investment of £1,667 to grow to £1m, depending on the growth rate achieved. The figure I’ve chose isn’t random. It’s the monthly equivalent of the £20,000 annual limit that can be put into a Stocks and Shares ISA.

Clearly, this is a lot of money. But nothing in life is free. However, to put this in context, the various scenarios show that the total amount invested could double within 21-26 years. What’s not to like about that?

Taking 25 years as a reasonable period over which to invest, £1,472 a month would grow to £1m, assuming a 6% annual return. At 8%, this figure drops to £1,094.

Not everyone’s going to be in a position to build a £1m+ ISA but these figures show that with patience and discipline it’s possible.

A slow burner

One stock that’s delivered a 6% increase in its share price over the past 10 years is National Grid (LSE:NG.), the energy group. And with a current (10 April) yield of 3.5%, it could be one for long-term investors – those looking to build a £1m+ portfolio — to consider.

Admittedly, it’s likely to be a slow and steady performer. But reliable and consistent – if unspectacular — returns are a feature of operating in a regulated industry. For example, the group’s allowed to earn just over 6% a year from managing the high-voltage power network in England and Wales.

It’s targeting an annual 6%-8% increase in earnings per share up until 2029. It also aims to grow its dividend in line with inflation.

However, if interest rates go up – or remain higher for longer – the group’s earnings could come under pressure. At 30 September 2025, it had total borrowings of £45.9bn. It surprised investors in 2024 with a £7bn rights issue.

Despite this, I think it’s the sort of stock that could be put into an ISA and forgotten about. The majority of its earnings come from markets where it doesn’t have to worry about winning new customers. This gives it more visibility — and greater certainty — over its future earnings than other businesses of a similar size.

The post Is now a great time to start aiming for a £1m Stocks and Shares ISA? appeared first on The Motley Fool UK.

Interested to know which dividend shares they like in particular? Here’s a look at the top individual stock holdings of AJ Bell’s ISA millionaires.

Millionaires like blue-chip dividend stocks

Back in February, the broker published a list of the most owned investments among this cohort of investors on its platform. Not only did it highlight their favourite stocks, but it also listed their favourite investment trusts, funds, and ETFs (these people tend to take a diversified approach to investing).

On the stock side, the five most popular shares were:

• Shell
• GSK
• Legal & General
• National Grid (LSE: NG.)
• Aviva

These are all ‘blue-chip’ FTSE 100 companies with healthy dividend yields (ranging from 3%–9%). So, these investors seem to prioritise stability and income.

I should point out though that these aren’t necessarily the best shares to consider buying if someone is aiming to become an ISA millionaire. Most existing millionaires are older investors (many are in their 70s) and an approach focused on stability and income is going to match their goals and risk tolerance.

Someone younger targeting a million-pound ISA could be better off focusing on stocks with more growth potential. This approach could enable them to achieve their goals faster.

Another thing to point out is that the millionaires may have bought these shares for their ISAs 20 or 30 years ago. A lot has changed since then and there could be better opportunities for those investing for the next 10, 20, or 30 years.

A stock for the next 10 years?

Zooming in on the five names though, the one that looks most interesting to me today, from a long-term perspective, is utility powerhouse National Grid. I see it as the most resilient to change and technological disruption (the insurers could face some challenges here).

As the world becomes more digital in the years ahead, demand for electricity is likely to rise significantly (due to the huge power demands of data centres and AI). This is where National Grid comes in – it’s essentially the ‘landlord’ of the infrastructure that makes these technologies possible in the UK (and some parts of the US), pocketing a return on the electricity that flows through its network.

It’s worth noting that the company is spending heavily right now to build out and enhance its network infrastructure for the AI era – between now and FY2031 it plans to spend about £70bn. This kind of spending is a risk as it could hurt profitability.

However, the group believes that it will still be able to achieve underlying earnings per share growth of 8%–10% per year in the medium term (13%–15% this financial year). It’s also planning to grow its dividend payout (where the yield is about 3.6% currently) in line with UK inflation.

So overall, there’s a lot to like, in my view. Trading on a forward-looking price-to-earnings (P/E) ratio of 15, I think it’s worth a closer look today.

The post 5 dividend shares that ISA millionaires love appeared first on The Motley Fool UK.

Global conflict has however, hit National Grid shares along with so many others. And at the time of writing, they’re down from their 52-week high in early March. But we’re still looking at a rise of around 50% over the past five years.

Volatile rise

Checking back 10 years and more, it looks like the ride’s been a bit volatile for National Grid shareholders. On the bright side, during a price dip, the dividend yield rises for new investors. And what really counts is the total return, including both dividends and price gains.

The forecast dividend is currently at a fairly modest 3.7%. That’s essentially in line with the FTSE 100 average. And over five years, the National Grid share price has come in slightly below the Footsie. In fact, it hasn’t been a great decade for the stock compared to the wider stock market.

But if we look back as far as the company’s original entry into the FTSE 100 in 1995, the share price has soared by over 400%. Over the same timescale, the FTSE 100 has managed less than half that.

What does it mean?

If National Grid can repeat its 30-year performance over the next three decades, I think it could make it a slam-dunk buy for a Stocks and Shares ISA. But we shouldn’t assume that, with one key trend broken in May 2024.

That’s when the company launched a surprise new £7 billion rights issue. It was to fund a five-year infrastructure upgrade plan. And at the time, it was the biggest such issue in the UK since 2021. It came as a particular shock to shareholders, who really hadn’t expected it. No, the company was renowned for nothing much changing year after year, and just steadily paying a progressive annual dividend.

It meant the per-share dividend actually fell, diluted by the new shares in issue. Many investors had simply assumed that could never happen.

The question now is whether National Grid is still a solid stock, with a strong safety margin, to consider buying today. And I’d call that a yes.

Safety first

For me, a Stocks and Shares ISA should ideally be based on a bedrock of safety. And looking at National Grid, I just don’t see how anyone else could be remotely likely to breach its moat and get a serious foothold in the UK-wide energy distribution network. Oh, and there’s American infrastructure to add a bit of excitement too.

We need to forget the old ways though. The world’s changed, and National Grid along with it. And the energy business being a regulated one also adds risk.

What about a forward price-to-earnings (P/E) ratio of 16, dropping to 13 by 2028 forecasts? And a dividend predicted to edge up 7.5% in the next three years? That makes it worth considering for a long-term ISA, I reckon.

The post Is National Grid one of the best stocks to buy for an ISA right now? appeared first on The Motley Fool UK.

That urgency isn’t about a closing door, but about time: the earlier money is put to work in a Stocks and Shares ISA, the longer it has to compound and grow towards that goal.

What it really takes to earn £10,000 a year

A £10,000 annual income would typically require a Stocks and Shares ISA worth somewhere in the region of £150,000 to £200,000, depending on the dividend yield achieved.

For example, a 5% yield would require a £200,000 portfolio, while a more ambitious 7% yield would reduce that figure to around £143,000. But higher yields often come with higher risks, so striking the right balance is key.

Using a more balanced 6% annual return as a planning assumption, the next question is how long it might take to build an ISA of that size.

The chart below illustrates how consistent monthly investing can compound over time at this rate.

What it highlights is simple. Even with a relatively healthy return, lower levels of investing may still fall short of the portfolio needed to generate £10,000 a year. That means contributions, time, and investment choices all matter.

Chart generated by author

Energy play

One stock I think investors should consider is BP (LSE: BP.). The oil major currently offers a dividend yield of 4.1%, and strong recent share price performance reflects the scale of cash being generated across the business.

While profits can be cyclical, BP has consistently produced strong free cash flow in recent years. That has supported its growing dividend, alongside additional shareholder returns through buybacks.

This combination of income and cash generation is exactly what I look for in today’s volatile markets.

The main risk, however, is that earnings remain tied to energy prices and capital allocation decisions. If conditions weaken or investment spending rises too quickly, returns to shareholders could come under pressure.

Portfolio stabiliser

To balance that, I suggest considering a very different type of energy exposure in National Grid (LSE: NG.). The business currently offers a dividend yield of around 4%, supported by a recent pullback in the share price that has pushed income levels higher for new investors.

Unlike BP, the company is not driven by commodity prices. Instead, it operates regulated electricity and gas transmission networks, meaning returns are largely set by agreed frameworks with regulators. That gives the business far greater visibility over future cash flows.

The key attraction here is less about high income today, and more about steady, inflation-linked dividend growth over time. That makes it a useful stabiliser within an income-focused ISA portfolio, particularly when combined with more cyclical holdings like BP.

Risks remain — including regulatory changes, higher interest rates, and the capital demands of maintaining and upgrading grid infrastructure. However, the underlying income stream is typically far more predictable than most equity investments.

Bottom line

For me, building a £10,000-a-year income from a Stocks and Shares ISA is about combining different types of dividend payers and staying invested through market cycles. BP and National Grid are just two examples of how I approach that balance. But they are far from the only opportunities I’m currently watching.

The post How to aim for a £10,000-a-year passive income from a Stocks and Shares ISA appeared first on The Motley Fool UK.

That’s because once the window closes, this year’s £20,000 contribution room is gone forever. No catch-up. No second chances.

And the real advantage isn’t just the tax-free wrapper — it’s starting the compounding clock as early as possible.

From there, you can gradually build a portfolio designed to generate growing passive income over time, without rushing into decisions today.

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.

Working toward a £2,000-a-year income target

At first glance, £20,000 producing £2,000 a year in passive income implies a 10% yield — something I wouldn’t try to achieve upfront.

Instead, I see the ISA as the starting point of an income engine, not the finished product.

A sensible starting portfolio might yield 4%–6%, generating around £800–£1,200 a year in income. But the real power comes from what happens next: reinvesting those dividends and allowing companies to increase payouts over time.

That combination — reinvestment plus dividend growth — is what can gradually turn a modest starting income into something closer to £2,000 a year.

Steady compounder

If I were putting that ISA to work today, I wouldn’t start with speculation — I’d start with income visibility. And one of the first names I’d consider is Aviva (LSE: AV.).

At a yield of around 6%, it already does a large part of the job for you. On a £20,000 ISA, that’s roughly £1,200 a year in income before reinvestment or dividend growth is even considered.

But the real attraction isn’t just the headline yield. It’s the improving quality of that income stream. The insurer’s shift towards a more capital-light business mix and stronger cash generation means dividends are better supported than in the past.

Of course, this is still a financial stock. Bond markets, credit conditions, and economic downturns can all pressure capital strength and earnings in the short term.

But as a starting point for an income portfolio, it gives you something crucial: immediate yield today, with the potential for that income to compound over time.

Diversify the income engine

But Aviva alone isn’t the portfolio — it’s one type of steady compounder, where income is supported by financial markets and balance sheet strength.

National Grid (LSE: NG.) sits in a different category. It’s still a long-term income compounder, but with far greater earnings visibility thanks to its regulated structure.

As a regulated utility, returns are linked to inflation, with allowed revenues adjusting over time. That creates a built-in mechanism for steady income growth.

More importantly, earnings expand as the business invests in its network. With more than £60bn committed to upgrading infrastructure across the UK and US, the regulated asset base continues to grow — and with it, future income potential.

On top of that, electricity demand is structurally rising. Electrification and AI-driven data centres are increasing long-term grid usage, reinforcing the need for ongoing investment.

The result is not just a defensive yield stock, but a long-duration compounding asset with embedded growth potential that many income investors overlook.

These are just two quality dividend compounders I’d consider for a diversified portfolio — but they’re far from the only income opportunities on my watchlist.

The post Last chance ISA: I’d aim to turn £20K into £2,000 a year in passive income appeared first on The Motley Fool UK.

A rising debt burden and higher bond yields have helped fuel the narrative that the sector may not be the most attractive place to park capital right now.

But that view may miss one of the most important structural shifts across electricity grids since they were first built in the 1960s.

And it may be far bigger than the market realises.

A traditional utility under pressure

Higher interest rates have changed how investors value income assets, and utilities have not been immune. As bond yields have risen, they now offer a more direct alternative for income, increasing competition for traditionally defensive sectors.

At the same time, higher financing costs have brought the company’s leverage into sharper focus, reinforcing concerns about balance sheet strength in a higher-rate environment.

Together, these forces have weighed on sentiment, shaping a market narrative that positions the group as a defensive but low-growth utility. Stability is still valued, but long-term upside is increasingly being discounted.

Inflation-linked compounding

This is not the typical equity income story the market often assumes. Operating within a regulated framework provides high earnings visibility and predictable cash generation over time.

Crucially, much of that framework is linked to inflation, with returns and allowed revenues typically adjusted in line with measures such as CPIH. That creates a built-in mechanism for income growth, rather than reliance on cyclical pricing or timing.

This is reinforced by a multi-decade investment cycle, with more than £60bn committed to upgrading and expanding UK and US networks. As the regulated asset base grows, so too does the earnings base, creating a compounding effect over time.

The result is a business that looks less like a static yield vehicle, and more like a long-duration, inflation-linked growth engine.

AI arms race

What is increasingly being overlooked in the National Grid investment case is not cost or regulation, but demand. Electricity demand is no longer a steady, mature-market story — it’s entering a new structural growth phase driven by electrification and AI.

AI data centres are emerging as the fastest-growing sources of power consumption in developed economies.

The direction of travel is clear. Compute-intensive infrastructure requires vast and rising amounts of electricity, much of it concentrated around grid networks.

At the same time, electrification of transport and heating is accelerating. EV adoption, heat pump rollout, and industrial decarbonisation are all shifting energy demand from fossil fuels onto the electricity system.

In that environment, grid capacity becomes the constraint, not the commodity. That is a critical shift. The company sits at the centre of this bottleneck, effectively becoming an enabler of every major energy transition trend.

Rather than diminishing visibility, this extends it. The investment cycle required to expand and reinforce grid networks points to decades of asset base growth, not years. Demand is no longer stable — it is structurally accelerating.

I see National Grid less as a utility and more as critical infrastructure for an electrifying world. If that view proves right, today’s pricing may understate its long-term growth and income potential, which could make it worth considering.

The post National Grid shares and the hidden AI electricity boom investors are missing appeared first on The Motley Fool UK.

The Self-Invested Personal Pension is often overlooked but also offers some stellar tax breaks. Investors can contribute the equivalent of 100% of their income, up to the £60,000 annual allowance. They can even mop up unused annual allowance from the previous three years.

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.

Choosing between the two is a little complex so I decided to call in artificial intelligence (AI), asking ChatGPT which is better, a SIPP or an ISA?

As a rule, I approach ChatGPT with extreme caution. It can be very hit and miss. But I thought it might work for a straightforward technical question like this.

Tax wrapper tactics

The chatbot described ISAs as simple and flexible saying: “Money grows tax-free and savers and investors can dip into it whenever they like. That flexibility is a huge plus”.

SIPPs, it said, come with a big upfront incentive: “The government adds tax relief to contributions. Pay in £80 and it’s instantly topped up to £100. Higher-rate taxpayers can claim even more back. That’s an instant boost”.

However, investors can’t access SIPP savings until at least age 55, rising to 57 from 2028. That makes it a long-term game, the chatbot said: “Fine for retirement, less helpful if you might need the cash sooner”.

One thing ChatGPT failed to state is that pensions are taxed on the way out as income, aside from the 25% tax-free lump sum. ISA withdrawals are free of tax.

Personally, I don’t see this as an either-or decision. ISAs and SIPPs offer complementary tax breaks. It’s worth striking a balance between the two. Someone with a big ISA might divert some funds to a SIPP, for example, and vice versa.

Once an investor’s picked their wrapper, the real challenge begins: choosing what to invest in. And that’s where I stop listening to AI. It can summarise facts, but it can’t judge value or risk, let alone pick stocks and shares.

National Grid shares are solid

One stock I’ve been looking at is National Grid (LSE: NG). It’s viewed as a steady FTSE 100 income play, thanks to its regulated business model and near-monopoly position in energy transmission.

It hasn’t been immune to recent volatility, but it’s held up better than most. Over the longer term, performance has been solid, the shares up 25% over one year and more than 50% over five, plus a reliable stream of dividends.

There are challenges. The group plans to spend at least £60bn upgrading grid infrastructure, and big UK projects have a habit of running over budget. The £7bn rights issue in 2024 also spooked investors, but they piled in when they saw the attractive terms.

However, National Grid remains a key part of the UK’s energy system. It’s even upgraded its growth outlook, guiding for solid earnings increases.

The valuation isn’t as cheap as it was with a price-to-earnings ratio of just over 22, and the yield’s come down to 3.7%. But for steady, long-term income, I still think it’s worth considering. Whether that’s in an ISA or a SIPP. But there are other FTSE 100 income and growth stocks I’ll buy first.

The post I asked ChatGPT if investing in a SIPP is a smarter move than using this year’s ISA allowance appeared first on The Motley Fool UK.