The government wants more people to open a Stocks and Shares ISA, and financial experts say that even a modest £100 can be the first step in your investment journey.
Financial experts routinely advise Brits to start investing as soon as possible, as it can provide better levels of returns when compared to traditional savings accounts. However, for those starting from scratch, putting £100 into investments might not feel worthwhile as it is only a modest amount. But this can still be the first step in your investment journey and a crucial investment in boosting your savings pot.
The Government's Push for Stocks and Shares ISAs
The Labour Party government recently launched their Savvy the Squirrel campaign to get people investing, as it hopes to push more Brits into opening a Stocks and Shares ISA. Last year, Chancellor Rachel Reeves announced that from April 2027, the annual tax-free ISA allowance will be slashed from £20,000 down to just £12,000 for anyone under the age of 65. The remaining £8,000 can be used in Stocks and Shares though, a clear indication of where the government wants people to put their money.
Anita Wright, Chartered Financial Planner at Ribble Wealth Management, said: "Investing is not squirrelling. Squirrelling is the psychological opposite of investing. To squirrel away means exactly what it sounds like. You find something valuable. You hide it somewhere safe. You retrieve it later, intact. The squirrel does not speculate. It does not accept volatility in exchange for growth. It does not log into its portfolio on a bad Monday morning and find the acorn stash down 20%. The squirrel hoards. That is the entire point of the squirrel. So Savvy the Squirrel is a good idea, imperfectly named, and in urgent need of a risk disclosure."
How to Start Investing with Only £100
Open a Stocks and Shares ISA
For most UK beginners, a Stocks & Shares ISA is one of the most tax-efficient ways to invest. Any growth or income generated within the ISA is generally free from UK capital gains tax and dividend tax. Popular investment platforms include Vanguard UK, Trading 212, Freetrade, and AJ Bell. Each platform has different fees and features, so it is worth comparing them before opening an account.
Diversifying Your Investments
With only £100, diversification is important. Rather than buying shares in a single company, many beginners invest in a global index fund. These funds hold shares in hundreds or thousands of companies across different countries and industries, reducing the risk associated with any one company. Examples include the Vanguard FTSE Global All Cap Index Fund, the Vanguard FTSE All-World UCITS ETF, and the iShares MSCI World ETF. These investments provide broad exposure to global stock markets in a single fund.
Keep It Consistent
While £100 is a good starting point, long-term success usually comes from investing consistently. Even small monthly contributions can make a significant difference over time thanks to compound growth. Setting up a monthly investment of £25, £50, or more—depending on your budget—can help your portfolio grow steadily.
Think Long-Term
Investing works best when you give it time. Markets will rise and fall, and short-term declines are normal. Avoid checking your investments too often or making decisions based on temporary market movements. A disciplined, long-term approach is often more effective than trying to predict market highs and lows.
The Beginner's Approach
If you're completely new, follow these steps:
- Open a Stocks & Shares ISA.
- Deposit your £100.
- Buy a diversified global index fund.
- Set up a monthly contribution you can comfortably afford.
- Leave it invested and avoid reacting to short-term market swings.
