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Things to bear in mind

A look at the things you need to think about when investing with Saga Investments.

The risks of investing

When you invest, your money is at risk. It's important you're comfortable with how much risk you're taking. 

Some people feel very uneasy about the idea of investments falling in value. Others are happier to accept the risk of ups and downs. How you feel about risk will influence which investment portfolio may be right for you.

It’s also important to think about the impact any losses will have on you. For example, if your investment is funded by an unexpected windfall, you might be willing to accept a higher level of risk than if you’re using your life savings.

When choosing your investment portfolio, you need to find a balance between the amount of risk of losing money you can cope with and the returns you need to reach your investment goals.

Investment risk

Investing in funds gives you access to a wide variety of investments, but their value and the value of any income generated may fall as well as rise. This can be caused by many things, for example global unrest and political uncertainty (such as elections or referendums). You should therefore aim to invest for the medium to long term (at least five years).

There’s no guarantee you will get back the amount you originally invested when you cash in your investments, and past performance is not a guide to future performance.

Each Saga investment portfolio is designed to provide the opportunity for growth according to the level of risk taken. There is no guarantee that the growth objective will be met. You need to think about whether your risk tolerance for falls in value matches the expected risk of the investments.

With the exception of the Federated Hermes Short-Term Sterling fund, the funds are all  ‘passive funds’. This means they’re designed to consistently track investment market indexes. They invest across different stock markets and asset types, so they will be exposed to stock market, exchange rate and interest rate ups and downs. 

Your circumstances may change, so it’s important to think about your investments at least once a year to make sure they’re still appropriate for you.

Suitability of Saga Investments

The Saga Investments products offer a choice of three ready-made investment portfolios. With the exception of the Federated Hermes Short-Term Sterling fund, the funds are ‘passive’ funds. This means the investments in them are not actively bought and sold to try to outperform investment markets. Instead, the funds are designed to consistently track investment market indexes. This helps keep costs low for customers.

Saga Investments is a non-advised service. That means you won’t receive advice on investment decisions or whether the products are suitable for you. If you need additional support to identify which products and investment portfolios will meet your needs, this will not be the right service for you.

Tax status of the Saga Stocks & Shares ISA

Currently ISAs offer a tax-efficient way of investing so you don’t pay Capital Gains Tax or Income Tax on any gains you make. 

There is a risk the UK Government may change the rules that apply to ISAs, either altering the way existing assets are treated and/or placing restrictions on future investment.

If there are any changes to the ISA rules, we’ll get in touch by email to outline the changes and explain whether you’ll be affected.

Personal tax implications when you invest in the Saga General Investment Account

The Saga General Investment Account doesn’t share the tax benefits of an ISA. 

The operation of the product will include the sale of funds, for example on rebalancing and withdrawals, which will lead to investment losses and gains. Depending on your personal tax position, this may mean that you need to pay Capital Gains Tax.  

Also, income received from fund dividends and interest payments will contribute to your taxable income, so – depending on your personal tax position – you may need to pay Income Tax. 

If this is a concern you should consider whether investing in the Saga General Investment Account is appropriate for you.  

The information provided on this website should not be taken as a recommendation, advice or forecast. Tax depends on your personal tax position. Tax rules are subject to change by the UK Government.

Hubwise Securities Limited (FRN 502619) is authorised and regulated by the Financial Conduct Authority, is an ISA Plan Manager (HMRC ISA Plan Manager Z1723) and a Member of the London Stock Exchange.

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