Where to start with pensions

dunstonh

The "inc" version of an income fund will distribute the dividend payment to you, normally on a quartely basis.The "acc" (for accumulation) version of the fund will reinvest the dividends in the fund.

They wont inside of a pension.

mattih5

I've scrapped the idea of a pension and am simply thinking of making monthly contributions to a fund of some sort or ideally several funds. Im getting a bit confused now because there are so many options. I don't know whether to go with Investment Trust, OEIC, Unit Trust etc. I unsure of which sector or fund to go with as there are so many.

I certainly wouldn't like to receive income on a quaterly basis, I would like everything reinvested as I am looking at this being a 5 to 10 year investment.

EdInvestor

I would suggest you go and open a mini S&S Isa.

If you intend to invest in only one fund, you could do a lot worse than this one which has a very long track record of excellent performance.

dunstonh

If you intend to invest in only one fund, then you should be prepared for lower investment returns over the long term. Single fund investing is old hat.

EdInvestor

I agree it's not optimal, but people have to start somewhere, and mattih5 won't be the first to be baffled by the choice out there.Once he gets started he will understand the system better and can start looking around at possible other choices to broaden his range.

dunstonh

So, you think its better to start out wrong and get round to fixing it later (which may or may not happen. Usually doesnt)?

If you are going to do it, do it right or get someone to do it right for you.

EdInvestor

So, you think its better to start out wrong and get round to fixing it later

It's not "wrong" to invest in only one fund - as long as it's a good one. It's less risky to diversify over a few.But again if they are !!!!!! non-performers, it's no help.

If you are going to do it, do it right or get someone to do it right for you.

Paying someone else to do it is no guarantee of getting it right. IMHo there's no subsitute for doing your own research.

DavidLaGuardia

dunstonh wrote:

If you intend to invest in only one fund, then you should be prepared for lower investment returns over the long term. Single fund investing is old hat.

f an individual is baffled by choice and unable to make a decsion then it is best put in the hands of someone else. Either use an IFA choose a suitable managed fund, or better still a Manager of Managers/multimanager fund that fits your risk profile.

EdInvestor

Frankly David, I'd say that's terribly advice. Why waste money on an advisor who's going to choose a bog standard managed fund - anyone can do that by themselves.

And those multi manager funds are often just an excuse for an extra layer of charges on top of the ones you are already paying for each fund.

dunstonh

A fund of funds would be a good option for a lazy investor. It doesnt matter if it costs a fraction more because the investment potential over the long term is better than a single fund solution.