Creating a stocks and shares Isa allows you to take full advantage of the long-term potential of investing free from tax.

They are an 'easy access' product, because there are no restrictions on withdrawals - though it is usually best to leave your shares, bonds, and funds untouched until you actually need the money.

In recent weeks we have heard much debate about whether many people are really making the best use of their savings by keeping them in cash rather than opening investing Isas.

A controversial Government idea to slash cash Isa limits to encourage more savers to start investing is apparently now on hold.

Yet, it is perfectly reasonable to be in favour of people retaining freedom over their own money decisions, but still acknowledge that over time investing is vastly more likely to make you richer.

If you are saving in cash for something which you aren't going to buy or need to start spending on within the next five years, you should consider the strong arguments in favour of investing.

One cheap and easy option is simply to invest more via your work pension, and you can check the pros and cons of doing this instead of using an Isa here.

If you decide a stocks and shares Isa is the best option, there is still time to open one and put in as much of this year's £20,000 allowance as you can afford before the 5 April deadline

Many of the best DIY investing platforms offer 'ready made' portfolios, which you can buy off the shelf based on a few simple criteria like how long you plan to invest and attitude to risk.

But some people will prefer to take a more hands on approach, research and select their own investments and run the show themselves.

We asked financial experts to offer tips on creating an Isa portfolio from scratch, and for some fund ideas to get you started.

1. Think about your goals and time horizon

'While there's definitely wrong ways to build a portfolio there's no definitive right way,' says Rob Morgan, chief investment analyst at Charles Stanley.

'The golden rule really is start with the basics and work from there rather than experimenting or arbitrarily picking investments that may or may not work for you.'

Morgan says getting the level of risk right is of paramount importance, and while there is no point taking too much and losing sleep at night, too little can be a missed opportunity.

He reckons deciding the level of risk that's right comes down to your goals. For example, if you are in your 20s and 30s and investing for retirement, cautious funds are not considered suitable.

Tom Laarberg, financial planner at EQ Investors, says: 'Your age, timeframe, income, appetite for risk and even attitudes towards impact on the planet and society should all be taken into consideration when you open an Isa.

'If your aim is to reduce your mortgage with a lump sum of £100k in 10 years, prioritise long-term growth, taking advantage of compounding, while managing risk through diversification.'

This means splitting your investments across different assets, parts of the world, and types of company or industry - find more on diversification below.

2. Consider how much you want to invest

If you don't have a lump sum but can spare some money out of your income every month, regular contributions into an investing Isa can be the best approach.

When investing over a long period, you can promise yourself to keep this up without regard to whether financial markets are up or down in a given month or even year.

If you have more on hand to invest immediately, you still can drip feed it into the market as described above, but if you plan to invest for a while and are comfortable with short term volatility it's best to take the plunge.

Laarberg cautions: 'Firstly, ensure you have an emergency fund covering at least three months of expenses. Then, assess your disposable income and determine an amount you can consistently invest.

'Automating your contributions via a monthly direct debit maintains discipline and takes advantage of pound cost averaging, smoothing out market fluctuations.'

3. Decide how you want to structure your portfolio

You will want your portfolio to stand the test of time, so as a starting point decide what will make up its 'core', suggests Dzmitry Lipski, head of funds research at Interactive Investor.

This core is typically made up of equities and bonds, plus alternative investments such as commodities or property. But again, there is no right or wrong way to do this, according to Lipski.

'If you're a more adventurous investor, you may want a portfolio heavier in shares. If you're more on the cautious side, or perhaps looking for income, more exposure to bonds might be best for you,' he says.

Lipski adds that if you are building a portfolio from scratch, you may want 10 different funds so you can select from a variety of different asset classes, regions, company sizes, and investment styles.

Rob Morgan, of Charles Stanley, says whether you are investing for income or growth is going to influence what you select too.

'Some funds are designed to provide a steady income, which can be particularly useful for those in retirement.

'Others simply aim to maximise overall returns in terms of both income and growth, which can be best for investors trying to maximise returns for the level of risk taken.'

He explains that you can buy 'income' units, which distribute income, and 'accumulation' units, which roll any up for you.

'The 'yield' of a fund can tell you roughly how much income you can expect to receive annually but beware this figure is often based on historical data and it varies all the time. Never buy a fund just because it has a high yield – it can be a sign of a high level of risk.'

Check the top right of This is Money's fund centre for an explanation of 'inc' (income), 'acc' (accumulation) and other common abbreviations tagged onto fund names, or read our guide to fund jargon here.

Morgan says with thousands of funds available it can be difficult for first-time investors to know where to start, but one way of quickly and easily diversifying is to invest in a global passive fund or 'tracker'.

'A global tracker can be used as a 'core' larger position in a portfolio around which more specialist funds can be added while keeping in line with your chosen asset allocation.'

'If you want to be more hands on and tailor a portfolio using a combination of more specific funds, you'll need a good mix.' Find fund ideas for starter investors below. 

4. Choose an asset allocation strategy

There are many ways to do this, but you can start by deciding which percentage of your portfolio you want in stocks and which in bonds and other asset types.

For example, Morgan says you could put 70 per cent in shares and 30 per cent in bonds (corporate and government) and other assets that can dampen down the typically greater ups and downs of the stock market.

'The longer the time horizon for the intended investment the more an investor could consider allocating to equities. For instance, when investing for retirement multiple decades away an asset allocation that prioritises equities exclusively, or almost exclusively, could be considered.'

He says you might want to take the make-up of global markets as a starting point, as reflected in the geographical and industry sector composition of a diverse global benchmark such as the MSCI ACWI World.

But Morgan cautions that the global market is dominated by the very large US market, while the UK is a small component - but some people like to have greater exposure to more familiar London-listed companies, or more meaningful exposure to emerging markets such as India and China.

For reference, Morgan explains the composition of the MSCI ACWI World.

By geography: USA 74%; Europe 9%; Japan 5%; UK 3%; Canada 3%; Others 6%.

By sector: Information Technology 23%; Financials 18%; Industrials 11%; Consumer Discretionary 11%; Health Care 10%; Communication Services 8%; Consumer Staples 6%; Materials 4%; Energy 4%; Real Estate 3% Utilities 3%.

Morgan suggest one way to adapt this into a more rounded portfolio could be: US 55%; Europe 15%; UK 10%; Asia & Emerging Markets 10%; Japan 10%.

Meanwhile, he explains bonds can offer some fixed interest exposure to temper stock market fluctuations, which is recommended if your investment time horizon is less than 10 years.

'Bonds are important for diversification because they tend to perform well if the event the economy slows by more than expected and interest rates are cut, a scenario that's usually bad for share markets.'

Dzmitry Lipski, of Interactive Investor, says: 'Investors who are uncomfortable with determining their own asset allocation calls, may wish to defer to expertise of managers of multi-asset funds.'

He says diversification is absolutely crucial when it comes to investing, and it is an ongoing job - it makes sense to review your portfolio regularly.

He suggests using the MSCI PIMFA Private Investor Indices as a reference for asset allocation examples such as conservative, balanced, and growth.

5. Research and select investments

Tom Laarberg, of EQ investors, says a wide range of investments can be held in a stocks and shares Isa – individual company shares, funds, investment trusts and bonds.

'You can choose from thousands of well-known companies and lesser-known ones. By opting for a fund, you reduce the risk of significant impact from one falling share price.

'Stocks generally offer higher returns over time compared to bonds or cash, but they come with greater short-term volatility.'

Lipski says: 'When it comes to assessing whether investment trusts and funds are suitable for your portfolio, it's necessary to look at the manager, the holdings, and the strategy to really weigh things up.'

'Investors should also assess a fund's performance relative to its benchmark and peers over a market cycle. A red flag, for example, might be when a fund lagged its competitors at a time when the market environment was actually favourable for that strategy.'

Read This is Money guides to researching investment funds here and investment trusts here.

6. Pick funds for a starter investment Isa

Tom tips

Vanguard FTSE Global All Cap Index (Ongoing charge: 0.23 per cent)

For a simple diversified investment approach, this low-cost, globally diversified fund includes large, mid, and small-cap companies from developed and emerging markets, he says.

Keeping costs low is helpful, as high fees erode long-term returns. This ensures more of your money stays invested and compounds over time.

Dzmitry tips

Vanguard LifeStrategy 20%, 60% and 80% (Ongoing charge: 0.22 per cent)

Investors who are uncomfortable with determining their own asset allocation calls, may wish to defer to expertise of managers of multi-asset funds, he says.

These funds are designed as long-term investment solutions and are not actively managed to volatility targets. As a result, they do not make tactical asset allocation adjustments in response to market fluctuations.

In the current market environment, their performance may face short-term pressure, particularly due to their bias toward US holdings. However, the strategy has demonstrated strong long-term resilience.

It's important to note that these funds are automatically rebalanced to maintain their static target allocations, rather than actively adjusting asset weights in an attempt to enhance returns.

Rob tips

Fidelity Index World (Ongoing charge: 0.12 per cent)

Low-cost tracker following the MSCI World index, he says.

JOHCM Global Opportunities (Ongoing charge: 0.99 per cent)

The managers of this fund typically take a more cautious stance compared with most in the sector, emphasising capital preservation, as well as prioritising durable businesses with strong balance sheets and consistent cash generation.

If insufficient attractive opportunities are identified they are prepared to hold some cash. This approach means the fund can be considered for part of an investors allocation to global shares and could blend well with a more aggressive, growth-orientated active fund or a tracker in a portfolio.

Artemis US Extended Alpha (Ongoing charge: 0.89 per cent)

The manager looks to extend the stock market opportunities available by supplementing a traditional portfolio with additional and offsetting 'short' positions that benefit from falls.

It therefore has the ability to keep up in rising markets but also protect capital a bit during times of market stress – though this is only the case if the managers get their tactical approach right.

WS Lightman European (Ongoing charge: 0.80 per cent)

This fund takes a value approach with manager Rob Burnett sticking to long held principles and a well homed process. Investors should expect a fund where the philosophy and execution remain consistent.

Man GLG Undervalued Assets (Ongoing charge: 0.90 per cent)

Adopts a disciplined approach to value investing with an emphasis on financial strength.

By focusing more on the current shape of the balance sheet, as well as cash generation and positive operating momentum, the managers target companies whose share prices do not fully reflect their 'intrinsic' value or and those whose profit streams are undervalued by the market.

Invesco Asian (Ongoing charge: 0.92 per cent)

Adopting a pragmatic and flexible process, the fund aims to respond to a range of economic and market conditions to take advantage of pricing inefficiencies from other investors' behavioural biases. A good, broad fund for exposure to Asia including the important Chinese and Indian markets.

Man Japan Core Alpha (Ongoing charge: 0.96 per cent)

A popular fund in the sector. Adopts a contrarian approach targeting Japanese shares that have fallen out of favour with the market.

Vanguard Global Credit Bond (Ongoing charge: 0.35 per cent)

The active, global approach taken by this fund provides a broad 'one stop shop' for good quality corporate bond exposure.

Compare the best DIY investing platforms and stocks & shares Isas

Investing online is simple, cheap and can be done from your computer, tablet or phone at a time and place that suits you.

When it comes to choosing a DIY investing platform, stocks & shares Isa or a general investing account, the range of options might seem overwhelming. 

Every provider has a slightly different offering, charging more or less for trading or holding shares and giving access to a different range of stocks, funds and investment trusts. 

When weighing up the right one for you, it's important to to look at the service that it offers, along with administration charges and dealing fees, plus any other extra costs.

To help you compare the best investment accounts, we've crunched the facts and pulled together a comprehensive guide to choosing the best and cheapest investing account for you. 

We highlight the main players in the table below but would advise doing your own research and considering the points in our full guide linked here.

>> This is Money's full guide to the best investing platforms and Isas 

Platforms featured below are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence. 

DIY INVESTING PLATFORMS AND STOCKS & SHARES ISAS 

	Admin charge	Charges notes	Fund dealing	Standard share, trust, ETF dealing	Regular investing	Dividend reinvestment
AJ Bell*	0.25%	Max £3.50 per month for shares, trusts, ETFs.	£1.50	£5	£1.50	£1.50 per deal	More details
Bestinvest	0.40% (0.2% for ready made portfolios)	Account fee cut to 0.2% for ready made investments	Free	£4.95	Free for funds	Free for income funds	More details
Charles Stanley Direct*	0.35%	No platform fee on shares if a trade in that month and annual max of £240	Free	£11.50	n/a	n/a	More details
Etoro*	Free	Stocks, investment trusts and ETFs. Limited Isa, no Sipp.	Not available	Free	n/a	n/a	More details
Fidelity*	0.35% on funds	£7.50 per month up to £25,000 or 0.35% with regular savings plan.	Free	£7.50	Free funds £1.50 shares, trusts ETFs	£1.50	More details
Freetrade*	Basic account free,  Standard with Isa £5.99, Plus £11.99	Stocks, investment trusts and ETFs.	No funds	Free	n/a	n/a	More details
Hargreaves Lansdown*	0.45%	Capped at £45 for shares, trusts, ETFs	Free	£11.95	Free	Free	More details
Interactive Investor*	£4.99 per month under £50k, £11.99 above, £10 extra for Sipp	Free trade worth £3.99 per month (does not apply to £4.99 plan)	£3.99	£3.99	Free	£0.99	More details
InvestEngine*	Free	Only ETFs. Managed service is 0.25%	Not available	Free	Free	Free	More details
iWeb	Free		£5	£5	n/a	2%, max £5	More details
Trading 212*	Free	Stocks, investment trusts and ETFs.	Not available	Free	n/a	Free	More details
Vanguard  Only Vanguard's own products	0.15%	Only Vanguard funds	Free	Free only Vanguard ETFs	Free	n/a	More details
(Source: ThisisMoney.co.uk March 2025. Admin % charge may be levied monthly or quarterly