Vanguard Life Strategy

Carpi09

ccbrowning wrote: »

Definitely just put your money in one of those funds. I'm in the 80% equity one, but I'm not very risk averse.

If you want to diversify beyond one of those funds you can always just put a small amount into a BlackRock fund or something... I am using HL, personally, but there are a few suggestions above from others.

Thanks,

I would say as a young 'ish' 23 year old, military with minimal outgoings, who has no plans for atleast the next 3 years, (Moving to Cyprus) I would say i could take some risk.

If you was in my position which one would you choose. I am thinking about the 60% because the 80% recommends 10 years + and I cant plan that far ahead. 5 years I would be comfortable with.

My plan was to leave the Military in the near future to join Civilian Police but having heard plans to cut new recruits pay by £4,000 it looks like i may well be in the military for some time!

Carpi09

InsertWittyName wrote: »

Same as other's have said really, there's no need to have more than one of the LifeStrategy funds at the start (the only real reason to hold more than one is to 'Lifestyle' your funds as you approach retirement or similar).

I have ~£35k in the 60% Acc fund on HL - £24 platform fee per annum is cheap as chips.

Thank you, feels my confidence hearing that (As a newbie)

Can i ask if you hold any other funds, or is it just that one?


Also, to all, can i just confirm that if i choose this fund, that i need not to worry about doing anything apart from contributing money?

Carpi09

JohnRo wrote: »

this may or may not help.

http://monevator.com/cheap-vanguard-index-funds/

The difficulty in selecting anything now is that the whole retail investment industry is built on back handed "hidden" commission charges and is currently in a state of flux as that is being changed by the RDR.

What ever platform you choose now there is a decent chance the rates and fees being charged will change before the year is out because it seems the whole retail platform industry is engaging in a huge chess game to secure their slice of the market.

That said HL does look a strong contender given what you require.

I did read that previously, again, confused me a little with all the fees etc. But yeah, maybe i should just get a hat and pick one out!

From what i've read, its between TD or HL.

JohnRo

You'll be better off with TD for this tax year and next at least if I have my sums right, since it's free with TD until August 2013 so a 0.35% charge introduced then will only knobble you for £26 or so by April 2014 - that's a balance of £11400 with TD from this years 5640 and next years 5760 at 0.35%pa for 8 months (assuming no growth or loss)

where HL will have already cost you a flat £32 by then but after that it's anyone's guess where the most cost effective platform will be.

Carpi09

JohnRo wrote: »

You'll be better off with TD for this tax year and next at least if I have my sums right, since it's free with TD until August 2013 so a 0.35% charge introduced then will only knobble you for £26 or so by April 2014 - that's a balance of £11400 with TD from this years 5640 and next years 5760 at 0.35%pa for 8 months (assuming no growth or loss)

where HL will have already cost you a flat £32 by then but after that it's anyone's guess where the most cost effective platform will be.

Thank you, I have applied for an account with TD so i guess i just wait until they contact me? Like other sites I have looked at, it asks what funds i would like but TD hasn't done this in the application process.

Like i said, I have £5640 for this year, should i put it all in the VLS 60% or should i choose a few other funds to split the lump up?

JohnRo

Since you're with TD now it wouldn't hurt to split your ISA allowance into more than one Vanguard or other fund but I'm not qualified or willing to advise what those funds should be.

You''ll have to make that decision yourself. Government bonds are generally accepted as being in bubble territory right now, so I'd favour higher equity allocations personally, only for the long term though.

ozzage

I would suggest not overcomplicating things.

Pick the one Vanguard LifeStrategy fund which is closest to your risk tolerance, open a HL account, shove your whole lot in there in that fund, and then forget about it until you're ready to throw some more in (next year's ISA allowance or whenever in the future).

Sure, you could see if TD is cheaper for the first two years.... and you could diversify a bit more.... but is that really what you want? You're after simple and effective, and you could do MUCH MUCH worse than this simple investment plan.

nicknameless

I'm a newbie to investing so always hesitant about giving advice but very surprised that an obviously naive (sorry OP) person asking about investments who's indicated an investment horizon of 3-5 years hasn't been met with the stock (pardon the pun) warning about potentially losing a signifant % of their capital in that time period.

OP - can you live with losing 20-40% of this if the markets plummet over the next few years?

Quite possible in that timescale.

P.s. building my SIPP using the 80% vanguard fund held with HL.

grey_gym_sock

yes, 3-5 years is a bit short for investing. ideally, you'd want to look at 10+ years.

if you do go for lifestrategy, just pick 1 of them. no need to make it too complicated.

as well as a choice of the % equity (20, 40, 60, 80, 100), there's also a choice of Acc (= accumulation) or Inc (= income). "accumulation" means that income is automatically reinvested; "income" means that it's paid out (either to you, or the cash just sits inside the ISA until you decide what to do with it).

racing_blue

I'm not an expert by any mean. I have a DIY investment approach that involves a SIPP and ISAs. I reckon overall it costs £104 per year in platform fees +about 0.2% of the total value in annual management fees. Which I think is OK, but if anyone can show me a cheaper way- thanks!

SIPP:

I wont be accessing my SIPP this decade or next. So growth at low cost is what I want, and am trying to achieve by drip feeding into a Vanguard LifeStrategy 100% equity accumulation fund with HL. This currently costs £24 per year, plus Vanguard's annual management charge of 0.33%. When my hair gets greyer I'll start transferring some to fixed income investments.

ISAs

Here I'm aiming for a 60:40 mix of risky/defensive assets because while I want the value to grow, who knows what curveballs life may throw- and this is a pot of money that can be accessed at any time.

In the spirit of diversification, my s&s ISAs is with interactive investor rather than HL, and contains nothing from Vanguard. This platform now costs £20 per quarter, but allows 2 free trades per quarter which sits well with my long term buy and hold approach. I certainly wont do more than 8 trades this year.

My cash ISAs tart around a bit, and I count (indeed prefer) ISA cash in the 40% defensive part of the mix.

My ISA platform and dealing charges are £80 per year, which is less than 0.1% & I can live with that. Add on the annual management charges on some of the ETFs in my ISA, my own calculated expenses ratio is around 0.1% which I'm happy with.