How to pick 1 or 2 investments

Jaguar_Skills

bowlhead99 wrote: »

I said there was no point getting a SIPP and paying for platform services you don't need.

0.05 to Fidelity and 0.25 to Cavendish plus 0.24% to Vanguard for Lifestrategy is 0.54 total, and Vanguard is nearly the cheapest multi asset fund out there. Meanwhile you can get simple stakeholder funds for 0.5-0.6% all in and personal pensions will get cheaper the more money you have in your portfolio in total.

Thanks Bowlhead. I may be being completely naive here but if Vanguard under Cavendish via Fidelity is 0.54 isn't that half decent?

What are stakeholder funds?

I can't seem to find simple multi asset funds like Vanguard or Blackrock in personal pensions which I want to create 90% equities and only a couple of holdings to make my pension simple. Does that make sense?

I suppose I am only looking at Cavendish, do you think it is worth looking at personal pensions with stakeholder funds elsewhere? All I really want is a balanced global tracker but with 90% equities (FOR NOW) then will rebalance in the future.

I thought I was learning, now I feel like I am going backwards.

Jaguar_Skills

So looking at it, Vanguard isn't a multi asset fund at all is it? It is an index tracker...

Is Blackrock consensus the saME?

AlanP_2

Lots of points here which I will address where I can.


I went through Cavendish to access the Fidelity funds as it worked out cheaper. You don't pay the annual £45 (I think it is) fee and the charges were about 0.05% cheaper if I recall correctly.

Personal Pensions - I think there are two distinct versions of these, the traditional ones purchased through an insurance company (such as Aviva) or financial services company (such as Virgin) as well as more recent "cut down SIPPs".

These offer DIY options but only for basic investments such as funds, no physical property and the like.

Fees are typically less than for a true SIPP but why pay for features and facilities you don't intend to use?

I pay 0.05% + 0.25% + Fund Fee with Cavendish as a non-advising Broker and invested through Fidelity.

Vanguard offers a range of funds some of which (the LifeStrategy ones) are multi-asset, or at least multi-fund.

Each VLS Fund invests in a number of specific Vanguard Funds and EFTs (Trackers) to achieve the spread of investments they are marketing. Doing it yourself by investing directly into the underlying funds is a bit cheaper so I have read on here but going VLSxx is easier.

The full range of VLS funds are available through Cavendish / Fidelity via the link I posted earlier.

I haven't looked into traditional Personal Pensions or Stakeholders so can't comment on costs or relative merits.

I went for the Cavendish (DIY) PP as it offered a range of investment options through a diverse spread of funds from multiple providers at a reasonable price point (in my opinion).

redbuzzard

Jaguar_Skills wrote: »

So looking at it, Vanguard isn't a multi asset fund at all is it? It is an index tracker...

Is Blackrock consensus the saME?

Essentially yes, both are composite trackers with international equities and bonds. They can still be fairly described as multi asset I think.

Compare Blackrock Consensus 85 with Vanguard 80. The Vanguard fund has more US weighting, the Blackrock more UK. Both have c. 20% bonds.

AlanP_2

dunroving wrote: »

First, why would anyone go through Cavendish to get at Fidelity, when you can go straight via Fidelity and save .05%? Is there some advantage to Cavendish? Or did you just suggest this because the OP said they wanted to use Cavendish?

Just had a quick look at Fidelity site and it looks to me as if they charge a 0.35% Service Charge so via Cavendish it is 0.05% cheaper as I originally thought.

Special offer at the moment though - waive the service charge for first year if opened by 5 April.

Jaguar_Skills

Thanks Alan. I am now looking at Blackrock consensus 100 and Vanguard 80 via Cavendish.

On the front page the charges are listed as:


Annual Charges

Typical Fund Manager Charge 0.07%-0.75%

FundsNetwork Platform Charge 0.25%

Cavendish Online Ongoing Fee 0.05%

Now...when I go specifically into Blackrock or Vanguard they have the Annual Management Charge which I assume is the Fund Manager Charge, so for Vanguard is 0.24% but there is also something which states Service Fee 0.20% (0.25% within a Pension) but that isn't stated on the front page of Cavendish.

As I added it up it would be:

FMC 0.24%
Platform Charge 0.25%
Cavendish Fee 0.05% = 0.54% as Bowlhead also stated earlier.

What is the service fee thing?

AlanP_2

The service fee of 0.25% is the sum of the 2 numbers on the front page (0,05 and 0.20).

Platform Fee and Service Charge are interchangeable terminology and the same thing unless I have got it totally wrong.

An ISA via Cavendish is charged at 0.20% and the PP is charged at 0.25% to reflect additional "back office" costs to administer a pension I guess.

BTW - Don't forget in your calculations that Fidelity will reclaim the 20% tax element i.e. an additional 25% will be paid into your pot by the taxman and allocated in line with the fund %'age splits you have instructions you have given them (if more than 1 fund involved).

Tax reclaim seems to take 2-3 months, we opened ours in December and the tax reclaim on the initial lump sum has just arrived along with January's drip feed tax reclaim.

Took just under 2 weeks to get it opened and funds invested from when we sent in the application form. Drip Feed amounts get invested in 2-4 days of the DD going out.

Jaguar_Skills

Alan you've been really helpful that ks so much. That makes sense now. Not sure why they change the wording!

Tomorrow I am going to outline my plan (in a new thread) before I start applying.

AlanP_2

No problem.