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Compare the best stocks and shares ISAs

3 mins read
by Unbiased Team
Last updated Thursday, June 6, 2024

An individual savings account (ISA) is a tax-free savings or investment account that allows you to save up to £20,000 a year tax-efficiently. Compare the best stocks and shares ISAs for 2024 from leading UK providers below.

*Fees shown may vary based on the value of your investments. Detailed fees can be found on the providers’ websites.

1. AJ Bell Dodl

Min. investment amountAdvantagesCost to you
£100 or £25 per monthYou can access various investment options and an app for convenience, as well as benefit from a low fee.£15 a year (£1.25 per month) for 10k invested

2. interactive investor

Min. investment amountAdvantagesCost to you
£100 or £25 per month (DIY ISA), £250 or £50 per month (managed ISA)You have many ready-made portfolios to choose from, as well as funds, investment trusts, bonds, shares and ETFs.DIY and managed: the cheapest plan is £59.88 (from £4.99 a month) for 10k invested.

3. Hargreaves Lansdown

Min. investment amountAdvantagesCost to you
£100 or £25 per monthYou can access ready-made portfolios based on your risk attitude and invest in various assets.£45 a year for 10k invested

4. Fidelity

Min. investment amountAdvantagesCost to you
£1,000 or £25 a monthThere are tools to help you figure out how to invest and a lower service fee if you have a bigger investment portfolio.£35 a year for 10k invested

5. Wealthify

Min. investment amountAdvantagesCost to you
£1You can get an investment portfolio built for you and pay a flat fee. You only need £1 to invest.£60 a year for 10k invested

What is a stocks and shares ISA?

A stocks and shares ISA is one that holds investments instead of cash.

Despite the name, it can hold a wider range of investments than just equities (stocks and shares), and may include bonds, investment funds and investment trusts too.

How do stocks and shares ISAs work?

When setting up your stocks and shares ISA, you’ll get to choose your investments.

This is a critical step that determines both the risk level and potential growth of the ISA, so it’s worth taking financial advice.

At the very least, you should read carefully the documents from the ISA provider, to ensure you understand the various funds and assets in which your money may be invested.

What are the benefits of a stocks and shares ISA?

The main benefit of a stocks and shares ISA is it allows you to invest in various investments without paying capital gains tax (CGT) on the growth, which you will do if you exceed your CGT allowance.

This can be particularly useful if you’ve made other capital gains elsewhere in that year, such as selling a second property.

Selling a large asset like this can wipe out your CGT allowance, so holding other investments in an ISA can protect that growth from tax.

What are the disadvantages of a stocks and shares ISA?

Stocks and shares are considered high risk or ‘volatile’ assets, so they are prone to sudden changes in value, either rises or falls.

This means that any investment in the stock market can go down and up, and a market crash can result in heavy losses.

For this reason, equities are not recommended as a short-term investment except for very experienced investors who know how to ‘time the market,’ and even some experts frequently get it wrong.

Should I invest in a stocks and shares ISA?

A stocks and shares ISA can be a great vehicle for saving for mid-term or longer-term goals.

If you have money you can put away for several years without touching it, a stocks and shares ISA will, in most cases, deliver better value than cash savings.

Stocks and shares ISAs are particularly popular for Junior ISAs, where saving can begin when the child is a baby and continue until they reach 18.

18 years is a good amount of time for stock market investment, and historical growth over similar periods has almost invariably beaten inflation and cash savings.

How to buy a stocks and shares ISA

To open a stocks and shares ISA, you’ll need to decide how much you want to invest.

Remember that you can invest up to £20,000 of tax-free money into an ISA, so decide what proportion you’d be happy investing (or can invest).

You then need to select a platform or provider to open your ISA.

You can choose what stocks and shares you want to invest in yourself, delegate the investment to someone else, or potentially choose from a pre-set ISA with a set number of investments.

Seeking financial advice

Considering investing? You should do your research to ensure your investment strategy matches your risk appetite and goals.

Saving for the future can be daunting, but it doesn’t have to be.

Unbiased can quickly connect you to a financial adviser who can support you with your goals, whether starting your investment journey or planning for retirement.

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Author
Unbiased Team
Our team of writers, who have decades of experience writing about personal finance, including investing, retirement and pensions, are here to help you find out what you must know about life’s biggest financial decisions.