Legal & General Fund recommendations

Dithering_Dad

I have just set up an L&G stakeholder pension that I am paying £234 a month into and plan also to pay one-off amounts from my limited company into. I have just transferred a money purchase pension from my former employer into this and will have about 14k in there. I am also considering moving a Money Purchase pension from another former employer into there that will add a further 50k to the pot.

I currently have it all invested in their Global Equity 70:30 Index Fund. I obviously want a mixed portfolio and as I have 25 years to retirement I am not too afraid of flutuations in the stockmarket.

I don't want to move from the stakeholder, so please don't go on about SIPPS, etc. etc. I also won't be moving from L&G. I also don't want to be moaned at for moving my pensions from company schemes because of the possible loss of entitlements - there are reasons I have/want to transfer these MP schemes.

With this in mind has anyone any suggestions which L&G funds would provide a good investment spread?

Cheers,
DD

Dithering_Dad

I'll take the silence as a "no" then shall I? :rolleyes:

dipsomaniac

nothing wrong with moving company money purchase schemes to a personal pension.

the most important thing about investing in collective investment schemes is not the charges but picking the best fund managers. by opening a stakeholder account with L&G you have just denied yourself access to approx 99.99% of the best fund managers.

if you are sticking with a stakeholder you need to construct a portfolio based on your attititude to risk and time in the market. You need a mix of uk, us, eur, far east and emerging market equity together with property. you don't have access to any commodity funds and i wouldn't look at any fixed interest at the moment as you still have 25 years until you retire.

EdInvestor

Dithering_Dad wrote: »

With this in mind has anyone any suggestions which L&G funds would provide a good investment spread?

Which ones are on offer?

As Dipsomaniac indicates one wouldn't normally bother with insurance company funds as they are not usually top performers, especially the ones made available in the stakeholder 'economy' product.

Dithering_Dad

dipsomaniac wrote: »

by opening a stakeholder account with L&G you have just denied yourself access to approx 99.99% of the best fund managers.

The trouble is, who are the best fund managers and will they stay the best and if they do, will they stay with the fund I invest with? I just don't have the time or experience to judge this and to be honest (and no offence), I really am not terribly interested in the stockmarket. I work long hours and any spare time I have I want to spend with my family. This is one of the main reasons I decided on a stakeholder. I decided on L&G because both my former company pensions are invested here (in the 70/30 fund actually) and they have done really well over the past few years.

The funds I have access to are here: L&G funds I can access

Using the risk levels in the L&G link, I guess I'd have a risk balance of say 20% of my fund value invested in cautious, 30% in moderate and 50% in High.

There seems a wide range of funds in there, but if I start getting interested in investing then perhaps I'll either move to a SIPP or a Self-select ISA. For now though I'll just be happy with any pointers towards:

1. Is my %age based risk levels a good idea.
2. If it is, then any idea which funds to go with?

Thanks for your replies so far! Any further assistance is greatly appreciated.

DD

dipsomaniac

if you don't have the time and don't want to pay anyone to provide advice I would just add the property fund to your portfolio to add another asset class.

the best fund managers don't become bad fund managers. they do sometimes move around or retire though.

Dithering_Dad

I'm not adverse to paying for advice, it's just that I dont have the experience to know if the advice is any good. Bit of a catch 22 i suppose

I see the next few years where I am freelancing, working long hours, travelling all over the place and generally not having much free time as being the time when I generate my "working capital". I want to stash it away somewhere and pretty much forget about it while I carry on making the money and paying off my mortgage. Once I'm done with this sort of a job, I can go back to a normal 9-5 on normal pay and then use my spare time to research the market and move my money to a better location.

For my 20% cautious investment I was wondering about the "Distribution Fund", seems like a nice snug place. They also have "Propery fund" that seems appealing, especially if I'm already investing in shares in the moderate and high risk areas...

dunstonh

None of the decent funds are available on the L&G stakeholder pension. Their personal pension is a lot better as it uses stakeholder and external funds. If its not too late, you should investigate the L&G PPP rather than the L&G SHP.

Dithering_Dad

There are 17 external funds available on the L&G stakeholder. It wouldn't really matter to me if they had 10,000 funds available to be honest. I wouldnt have a clue.

I have almost 12k in Protected Rights - can I invest this money as I please, or are there restrictions?

dunstonh

You cannot build a proper portfolio from those 17 funds so you may as well accept that it is going to be a compromise and go with a couple of bog standard internal global funds.

I know you have made your decision but I think you should review it and change the contract to give yourself a better option. You dont need 10,000 funds but you need more coverage than the 17 that are there. You arent saving any money by going with a stakeholder as all the stakeholder funds are available on the personal pension. All you are doing is limiting the growth potential of your investment portfolio and anything you may have saved in price will be lost with the reduced growth potential). Investment first, charges second.

Dithering_Dad

Thanks for your advice, and I do appreciate it, but seemingly I'm stuck in a loop:

1. I don't have time to research funds and to then dedicate to monitoring them while I'm working like heck to get the money together to invest.
2. I therefore invest the money within the same fund (70/30) and same company (L&G) that they were invested in with my former companies and did really well.
3. I get told that I should get a vehicle that has a wider range of funds.
4. Go back to step 1.

I'm not necessarily with the stakeholder just for the low AMC (but it is a factor), but also because it allowed me to invest in the 70/30. Subsequently, I've decided to diversify a little and that's why I thought I'd ask on here. I know that I could definately get better returns in a SIPP with a broad range of fund and share investments, but then we're back to step 1.

I'm thinking of investing 60% in the 70/30 fund, 20% in the Property Fund, 10% UK Smaller Companies and 10% UK Recovery. Probably a bit UK biased, but I love this dirty old country. On a scale of 1 to 10, where 1 is "madness you'll go broke" and 10 is "Wow, millionairedom here you come". Where am I with this?

With the protected right, is there any restriction on my investment of this money?