Managing Your Money 

Isa portfolio with good blend of investments

Reader Portfolio

Ian Kent, 64

Description

Isa portfolio

Objectives

Rising income

<p>Isa portfolio</p>

Until 2011 most of Ian Kent's stocks-and-shares individual savings accounts (Isas) were in a discretionary managed portfolio with a bank. He had retired in 2005 at age 57 and needed income to supplement his private pensions until he received his state pension late in 2013. However, he found that the level of income provided by the bank's portfolio was insufficient.

In 2011 and 2012 he decided to start investing himself and has since achieved more income with this DIY approach.

He says: "Many of the most recent purchases within my Isa have been driven by the decision to reduce exposure to pooled bond funds. I know that the individual corporate bonds are more risky from a default point of view, but I do intend to hold them to maturity. I have invested in some individual equities, in a spread of sectors, and various investment trusts.

"At the end of 2012 I was showing some losses on recent purchases, notably Morgan Sindall and Tullett Prebon. However, these have since recovered a little. I intend to keep my investments for the long term. I want to limit trading costs. I am pleased with my decision to diversify into smaller companies via Dunedin Smaller Companies Investment Trust, which has shown a very healthy advance in a short period.

His continuing objective is to achieve a worthwhile level of immediate income, with scope for it to rise over time. "I am inclined not to rush into new investment," he says. "I can be patient and move into quality stocks if prices drop, so raising the likelihood of achieving better value and higher yields."

He expects to subscribe to his stocks-and-shares Isa for 2013-14 and to invest in equities rather than bonds. He would like some recommendations for this.

In addition to the Isa portfolio, he has an emergency fund held in cash Isas which is earning 2.5 per cent interest. He also has money in a self-invested personal pension, part of which is being drawn directly from the fund via drawdown

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