Time to remind you of a high-yield open goal (7 per cent net of charges and potentially tax-free). Money&Co.’s peer-to-peer (P2P) loans bring individuals looking for excellent returns on capital together with carefully vetted small companies seeking funds for growth. Our lenders, in the four years we have been facilitating peer-to-peer (P2P) loans, have achieved returns of over 8 per cent – 7 per cent net of charges, as stated above. Inflation in the UK is running near the 3 per cent mark. That return becomes even more attractive if you hold the loans in one of our Innovative Finance Individual Savings Account. See below for our step-by-step guide to IFISA investing.
A Process Guide To Innovative Finance ISA Investment
Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.
So here’s our guide to the process:
The ISA allowance for 2018/19 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.
Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.
Future Of FinTech – Get Discounted Tickets Here
Just a reminder – our very own Nicola Horlick, CEO of Money&Co. – will be headlining The Future of FinTech breakfast symposium, held in association with FinTech intelligence platform Another Crowd, and Business Cloud in London on 12 July. Money&Co. readers can get a discount on tickets for this event – see below.
Risk: Security, Access, Yield
Do consider not just the return, but the security and the ease of access to your peer-to-peer (P2P) investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.