Investments and savings terminology
Can be classed as both an Investment and as Savings. With an ISA you do not have any income or capital gains tax liability on any proceeds you may receive. Technically speaking they are not 100% tax free as since 2004 the dividends received by the fund manager on shares they hold are received less of income tax at 20%.
You can have a Stocks and Shares ISA, which I would class as being an Investment. Into this you can invest up to £10,680 each year. There are many things which your ISA can hold ranging from "off the peg" Funds run by professional managers to "bespoke" investments chosen by yourself.
Also known as Life Insurance bonds' are single-premium contracts provided by life insurance companies. Again, like an ISA, you can choose to hold a wide range of different funds within them. The proceeds are subject to income tax. However there are valuable allowances available which can make them attractive to higher rate tax payers or to people entitled to the higher age related personal allowance. You can have either an “onshore”, which pays tax as it goes or an “offshore” version when you pay tax at the end.
This is when a fund manager puts your money together with other peoples and invests it in a wide range of assets. In effect you buy a unit in the fund. Each unit holds a little of every investment the manager has made. The fund is controlled by a Trust which sets out how the fund is run. They are a good way of being able to spread your money across a wide range of different types of assets.
Similar to a Unit Trust in the way that your money is pooled with other people’s but rather than owning a unit in the fund you hold a share in the company. Instead of a Trust the appointed Directors of the company control how the fund is run. Again they are a good way of being able to spread your money across a wide range of different types of assets.