Simple Q&A - NISA

[adamu]

I want to get rid of some things in my first NISA and was wondering if the rollover automatically brings everything or could I sell some and just rollover like half with the remaining free to fill up.

You can choose what to roll over.

You should sell the stuff you don't want while it's still in the NISA if it's in profit, to get the tax free gain. Or if you just want to move them out of the NISA, you can choose not to roll over those investments.

[Gareth]

Just wanted to check this with folk more knowledgable than me about NISA or tsumitate NISA.

If I sign up for a NISA or tsumitate NISA account, am I under any obligation to actually use it? I know for that iDeCo you have to pop in a minimum amount each month via direct debit. But is it similar for NISA?

The reason for asking is, I have the time to sort out opening an account now but probably won't be in a position financially to put any money into it until 2022. Wondering if I can go ahead opening the account now so that's it's ready to go for next year.

Cheers.

[Yossarian]

Just wanted to check this with folk more knowledgable than me about NISA or tsumitate NISA.

If I sign up for a NISA or tsumitate NISA account, am I under any obligation to actually use it? I know for that iDeCo you have to pop in a minimum amount each month via direct debit. But is it similar for NISA?

The reason for asking is, I have the time to sort out opening an account now but probably won't be in a position financially to put any money into it until 2022. Wondering if I can go ahead opening the account now so that's it's ready to go for next year.

Cheers.

You could I guess. But why? You would just waste some of your tax free years. Better to set it up when you're ready to start investing.

[adamu]

You could I guess. But why? You would just waste some of your tax free years. Better to set it up when you're ready to start investing.

Doesn't make sense to me. Opening the account doesn't waste anything. There's no obligation to use it. On the other hand, it gives you the option to get started earlier if you decided to.

For a NISA at least. I'm not sure whether tsumitate requires the monthly deposit.

By "waste some of your tax free years" I guess you were thinking that you get 5 years (for NISA), so if you opened it this year and didn't use it you'd be left with 4 years. That's not how it works. Each year is tax free for 5 years. This year's investments are tax free until the end of 2025, next year until the end of 2026, etc. So you're actually wasting years by not getting started sooner.

[Viralriver]

I setup (successfully) my monthly NISA payments via my rakuten credit card, and a bit extra through my tokutei account. Was expecting to max out on 500 points per month, but looking at my point card I haven't received these points. I did receive 55 points on March 3rd from 楽天証券, but this is far less than I would have expected of course. Is there a fairly long waiting period to receive the points, or is it possible I messed up somewhere?

[TBS]

I setup (successfully) my monthly NISA payments via my rakuten credit card, and a bit extra through my tokutei account. Was expecting to max out on 500 points per month, but looking at my point card I haven't received these points. I did receive 55 points on March 3rd from 楽天証券, but this is far less than I would have expected of course. Is there a fairly long waiting period to receive the points, or is it possible I messed up somewhere?

The points come from Rakuten Card, on the 15th of the following month from when the money is taken from the card. See bottom table here.

[Yossarian]

Doesn't make sense to me. Opening the account doesn't waste anything. There's no obligation to use it. On the other hand, it gives you the option to get started earlier if you decided to.

For a NISA at least. I'm not sure whether tsumitate requires the monthly deposit.

By "waste some of your tax free years" I guess you were thinking that you get 5 years (for NISA), so if you opened it this year and didn't use it you'd be left with 4 years. That's not how it works. Each year is tax free for 5 years. This year's investments are tax free until the end of 2025, next year until the end of 2026, etc. So you're actually wasting years by not getting started sooner.

Fair enough - seems I had misunderstood how it works.

[beanhead]

By "waste some of your tax free years" I guess you were thinking that you get 5 years (for NISA), so if you opened it this year and didn't use it you'd be left with 4 years. That's not how it works. Each year is tax free for 5 years. This year's investments are tax free until the end of 2025, next year until the end of 2026, etc. So you're actually wasting years by not getting started sooner.

So just to clarify, if you opened a regular NISA in 2021 and invested, say, 500,000. After 5 years if that rises to 600,000, you can move that into your tokutei account and enjoy the initial gain, tax-free. Not roll it over. Then, if in 2026 you are able to max it out at 1.22M for that year, you should do so.
So even if you cannot max it out it is better to start with what you can.
Is my understanding correct?
Cheers

[adamu]

So just to clarify, if you opened a regular NISA in 2021 and invested, say, 500,000. After 5 years if that rises to 600,000, you can move that into your tokutei account and enjoy the initial gain, tax-free. Not roll it over. Then, if in 2026 you are able to max it out at 1.22M for that year, you should do so.
So even if you cannot max it out it is better to start with what you can.
Is my understanding correct?

Exactly. You could also roll it over, and you'd have 0.62M left for 2026.

[beanhead]

Exactly. You could also roll it over, and you'd have 0.62M left for 2026.

aha. Of course. The rollover could still apply. Got it. Thanks very much.