Some people get into investing with the hope of getting rich quick. But that’s not how our ISA millionaires have done it.
Our ISA millionaires range from those in their 30s, to a number who are over 100. But the average age of our ISA millionaires is 73, and there’s a cluster between the ages of 74 and 76.
This means they’ve often built a fortune through the far more reliable approach of getting rich slow.
The portfolios of HL’s 573 ISA millionaires show every sign that in aggregate, they don’t take enormous risks. Instead, they’re consistently investing as much as possible of their annual ISA allowance, in a diverse and balanced portfolio.
What’s the secret sauce?
Their million-pound portfolios are likely to have been put together by investing consistently and making the most of their ISA allowance. A third of our ISA millionaires maxed out their allowance in the first month of this tax year, and by December well over half had used their full allowance.
Of course, a lot of us won’t be in the position to use our full ISA allowance every year. But the point is to try make the most of your tax benefits if you can and it’s right for you, and if so, to consider using them as early as possible. That way you can give your investments more time to grow, without having to worry about taxes, and will also help you benefit from compounding over the long term. Remember tax rules change and any benefits depend on individual circumstances.
Find out more about our Stocks and Shares ISA
What do our ISA millionaires invest in?
Taking a closer look at their portfolios, a typical ISA millionaire doesn’t take enormous risks. More of them hold collective investments, like funds, than individual shares.
They hold a broad international mix of funds, and there are also a couple of income funds – that’s because as you get older you often tend to switch to more income paying investments.
ISA millionaires have shown some enthusiasm for responsible investing too. When you have a larger portfolio, you also have more scope to add specialist funds into the mix. It’s why we see special situations funds and global opportunities in the list of popular investments.
If you’re looking for the secrets of millionaires to reveal how to avoid the long-term commitment of getting rich slow, this is going to be a disappointment. However, if you’re looking for proof that it could be worth the effort, then the ISA millionaires show just how your efforts might be repaid.
This article has been written independently of our investment research team to offer some inspiration, but isn’t personal advice or a guide on how or where to invest.
Investments and any income from them will rise and fall in value, so you could get back less than you put in. You should choose investments based on your own objectives and attitude to risk. If you’re not sure whether an investment is right for you, ask for financial advice.
| 10 most popular funds held by ISA millionaires | Key Investor Information (KII) |
|---|---|
| Lindsell Train Global Equity | KII |
| Fundsmith Equity | KII |
| Artemis Income | KII |
| Fidelity Special Situations | KII |
| Fidelity Global Special Situations | KII |
| IFSL Marlborough Multi Cap Income | KII |
| BNY Mellon Global Income | KII |
| Stewart Investors Asia Pacific Leaders Sustainability | KII |
| Rathbone Global Opportunities | KII |
| Lindsell Train UK Equity | KII |
Lindsell Train Global Equity and UK Equity funds have holdings in Hargreaves Lansdown PLC.
How to pick investments for an ISA
Investing in the funds listed above won’t be right for everyone. Only invest in a fund if its objectives align with your own, and there’s a specific need for that type of investment within your portfolio. Investors should understand the specific risks of a fund before they invest.
It’s also important not to put all your eggs in one basket. Spreading your money, diversifying, gives you access to more opportunities and can reduce risk.
FIND OUT MORE ABOUT DIVERSIFICATION
If you’re looking for inspiration from our investment research team on where to invest your ISA this tax year, explore our latest ISA investment ideas.
Or you can use our Wealth Shortlist. It’s designed to help investors build and maintain a well-balanced and diversified portfolio. We’ve put funds under the microscope to make sure the list only contains the funds that our in-depth analysis shows have the greatest long-term performance potential.
If you don't feel comfortable building and maintaining a portfolio, take a look at our ready-made portfolios. These portfolio funds let you choose how to balance risk and potential returns.
All you’ll need to do is review your choice regularly to make sure it still meets your needs and objectives.
HL’s ready-made investments are managed by our sister company Hargreaves Lansdown Fund Managers Ltd.
Open your ISA today in minutes
With the end of the tax year fast approaching, time is running out to open or top up an ISA this year. But don’t worry, it’s quick and easy to get started and takes minutes online.
Before you apply, please make sure you’re happy with our terms and conditions (including Tariff of Charges) and key features. Then all you need is your debit card and national insurance number to hand.