WHO WANTS TO BE AN ISA MILLIONAIRE?

...IF THIS COUPLE DID IT, SO CAN YOU

THE KEY to financial success is to ensure your money is working as hard as it can at all times. Get rich So series, far we in this have week’s shown you How how Tow To to make a mint from your property and nd boost your income in retirement.

Today, we are turning our attention to the contents of your piggy bank. You u may prefer to keep your savings where re you can see them — under a mattress ss (not recommended) or in a bank or r building society account.

But with savings rates so low, many accounts do not even beat inflation — so the spending power of your money is actually decreasing in real terms.

Investing in the stock market can provide much bigger rewards over time.

There are risks, but if you do your research and take professional advice when necessary, anyone can learn to be a smart investor. or.

retired entrepreneurs eneurs Chris and Brenda Gandy (below right) have grown their nest- egg to nearly £1 mil million. And the 67-yea 67-year- olds are in good c company, with an estimated est 1,000 UK savers sa now part of the so-called Isa million millionaire club.

So h how can you give yourself the best c chance of one day joining jo it, too?

The first step is to open a stocks and shares Isa to ensure all your you investment gains are protected d from the taxman. If you are a couple and you each invest the full £20,000 Isa limit each year, you could be joining the millionaire club yourselves within just 17 years, based on an average 5 pc a year return.

Chris, who lives with Brenda in Essex, says: ‘I realise that many people do not earn £20,000 a year — let alone have that much to invest.

‘But you will be amazed how much your investment can grow if you start by putting aside a small amount every month.

‘We’ve been fortunate to have had success through our three logistics and travel businesses, which we sold in 2013.

‘But we started investing long before we made money from the

sale, so it goes to show the earlier you can start, the better.’

To set up a stocks and shares Isa, you can go to a High Street bank with identity documents and your National Insurance number in hand, but you will get a much better choice of investments and lower charges if you shop around online using a site like Comparetheplatform.com.

Chris and Brenda’s next secret to success is to invest little and often. Chris says: ‘We first started investing back in 1988 and have been through several booms and busts since then.

‘We have made mistakes along the way and our investments plunged in the dot-com crash of the early 2000s, but bu our longterm term approach feed feeding in small sums over time means mea we made our money back and more.

Equally, leaving leavi money untouched and reinvesting returns is crucial to growing your wealth. This is because beca through the magic of compound compo interest — earning interest on your interest — your savings pot grows faster.

Chris and Brenda have kept as much of their money mone as possible invested in the markets mar through broker BestInvest, a and drawn out only what they need to maintain a comfortable lifesty lifestyle.

The next questio question is what to invest in. It is possible pos to own shares in a compa company directly, which m means your money depends dep on the success o of that business. ness. If you had invested £ 1,000 in Apple ten years ago, for exampl example, you would now be sitting on a nest- egg worth around £11,00 £11,000.

Or if you had £1, £1,000 in Facebook book shares seven years ago when it was first l listed on the stock exchange, you would have turned that into £5,930.

Chris says that just after the millennium, when internet stocks where booming, he received endless cold calls from stockbrokers flogging shares in tech firms. Thankfully, he wasn’t sucked k di in b by th their i sales l patter tt and instead did his own research into how to invest safely.

He says the risk of putting all your eggs in one basket is that you could pick a dud and lose lots of money. This is why most sensible investors tend to invest in funds, which allow you to distribute your money between lots of different stocks at the same time, spreading the risk.

Your money is pooled with that of other savers and invested by a fund manager in many companies. These can be UK-based or abroad and can specialise in a whole host of different industries

such as technology, pharmaceuticals or renewable energy.

Chris and Brenda’s bestperforming funds have been Picton Property Income Trust, Standard Life Private Equity Trust, Invesco Perpetual UK Smaller Companies Trust and Fidelity Asian Values Trust, which have turned £1,000 of investors’ money into £5,829, £5,752, £5,482 and £3,758 over the past ten years respectively.

That’s if you had followed the couple’s savvy strategy of re-investing all your dividends. Chris says: ‘When we first started investing we never imagined we would become Isa millionaires in retirement. If the markets are on our side, the value of our investments is set to break through the £1 million mark this year.

‘It means we can enjoy plenty of holidays and put away savings for our seven grandchildren.’

Other successful funds over the past decade have been Rathbone Global Opportunities, which invests in Amazon, MasterCard, Paypal and Visa and has turned £1,000 into £3,990. Newton Global Income, has turned £1,000 into £3,750 with investments in PepsiCo, the fizzy drinks maker, and Unilever — the company behind brands such as Persil, Dove and PG Tips — as well as international technology firms.

You can opt for a tracker fund, which aims to copy a chosen stock market such as the FTSE 100 and deliver the same returns. If you had invested £1,000 in Legal & General’s UK Index Trust ten years ago, which tracks the FTSE, you would have £2,380 today.

If you had chosen the Legal & General U.S. Index — which tracks North American markets — you would have turned that £1,000 into £4,150. Had you placed the same £1,000 in the average bank or building society account ten years ago, you would have just £1,080.

Here, Chris and Brenda reveal their tried- and- tested advice for making a million . . .

CHRIS & BRENDA’S TIPS

INVEST little and often to help smooth out the inevitable highs and lows in the market.

IT MEANS that should your investments fall in value, your next contribution will buy more because shares are cheaper.

DIVERSIFY your investments to create ‘a balanced portfolio’, meaning that even if one investment has a bad time, others should be unaffected.

TAKE less risk as you get closer to retirement, as you won’t have as long to recoup losses as someone who is in their 20s.

CONSIDER taking advice from an independent financial adviser. Visit

unbiased.co.uk or vouchedfor.co.uk to find an expert in your area.