Vanguard LifeStrategy 60% questions

jimjames

I'll answer some that may not be entirely clear

ValiantSaint wrote: »

Do you have to add money to the fund every month?

No. You can pay in once or multiple times, it's entirely up to you. Only limit is if you have an ISA but with £4k that's not an issue.

ValiantSaint wrote: »

Are you taxed on what you make from the fund?

Inside an ISA there is no tax to pay. Outside an ISA you'd pay capital gains on any gain above £11k. So your £4k would need to grow to £15k before you are even liable to pay any tax.

ValiantSaint wrote: »

Can you withdraw if you need too?

Yes you can get money whenever you need access. It could take around a week from selling to the money being in your bank account.

ValiantSaint wrote: »

And is the 60% fund too risky for an "all-in" investment?

Probably reasonable risk but not the best income if that's what you're after?
Returns from investments come as both dividends and capital growth. Funds focused on income pay around 4% but those on capital growth can pay 1% or so as income. If you don't need income then letting the dividends reinvest and grow is worthwhile and will compound your returns over the years.


This is an example of how that can work over a few years

https://forums.moneysavingexpert.com/discussion/5336097

ValiantSaint

Thanks again. So is the fund classed as an ISA, then? And who would be the best company to purchase the product from? (He says, she panicking if he'll lose the whole 4K when the markets crash!)

Linton

ValiantSaint wrote: »

Thanks again. So is the fund classed as an ISA, then? And who would be the best company to purchase the product from? (He says, she panicking if he'll lose the whole 4K when the markets crash!)

The fund isnt classed as anything. What is classed as an ISA or not is the account which holds the fund. If the account is an S&S ISA then all funds in that account are free of tax. Generally speaking an account can hold any number of different funds. Accounts are provided by brokers.

There are a number of different ISA account providers. See the Monevator list for the main ones with their charges. Which is best depends on how much money you are investing, what sort of investments you want to buy, what facilities you want, the elegance of the website and the charges.

black_taxi_2

started Jan 2015,£600 a month pound cost ave in

after costs - 1.61%

the fund itself is up 2%

ftse all share up 2%

ValiantSaint

the account which holds the fund. If the account is an S&S ISA then all funds in that account are free of tax.

Well, that's me lost! When's an ISA not and ISA?

I wonder if it's worth me getting hold of a financial adviser?

Black Taxi: What total amount have you seen in increase of funds since you started with the product?

somethingcorporate

You don't need an FA for just a £4k investment, it would take a long time to recoup the fees.

The ISA is the wrapper, the fund can be held in a pension (another type of wrapper) and ISA or just in standard fund portfolio (where it will be subject to normal taxation rules).

ValiantSaint

So if the funds are placed in an ISA, I'll be ok tax-wise - got ya

You can specify to the company the "wrapper" that you use to set up the fund? Or will it just be defaulted to this?

Who do you think I should go through? (As I'm a dolt!)

Mothman

For just £4K in a S&S ISA invested in one fund, Cavendish Online or Charles Stanley Direct would be worth a look, but there are plenty of others

ValiantSaint

Sorry to bump this thread up from the depths of MSE again, but I have a couple more questions about this S&S ISA. I do a little bit of IT work as a sole trader, would this ISA affect me when I'm doing a self assessment? (Would I have to declare it?) And does this ISA change your tax code, at all? (Even though you don't pay tax on it?) Many thanks

Linton

ValiantSaint wrote: »

Sorry to bump this thread up from the depths of MSE again, but I have a couple more questions about this S&S ISA. I do a little bit of IT work as a sole trader, would this ISA affect me when I'm doing a self assessment? (Would I have to declare it?) And does this ISA change your tax code, at all? (Even though you don't pay tax on it?) Many thanks

No and No, HMRC are not interested in ISAs.