Not paying down your borrowings first
You could waste years of your life paying interest if you get this one wrong!!
You invest £6,000 in an ISA because it’s tax efficient right? So how much will it make? Let’s say 5% a year after any charges - £300 a year. Good result?
You pay lets say 6% on your mortgage and probably more on plastic, overdrafts and loans… you have a really great deal and only pay 4.5%. So the cost of borrowing £6,000 is £270 for the year. But hang on don’t you pay tax? If you paid 20% Income Tax that £270 really lost you £337.50. You may as well have burned £67.50! And that is for just one year!!
If you owe money that you get charged for, pay it back before you even think about investing! Even if you are offered something on interest free terms it means there is room to haggle if you are a customer who can pay cash – it is what businesses are hungry for.