SIPPS - Not for people like me who like watching paint dry !

ukpoker

Back in 2009 I had big dreams on how I could make a million from my £33k t/f into an H/L SIPP so with my 55th birthday about to arrive and the money about to be withdrawn just how did I do??

With a change in pension rules meaning that I can cash out my bet on my 55th birthday in Oct I've decided that paying the bills and having some 'fun time' is more important that watching my wad move up and down on the whims of the market.

Its a real GRIND having to tune into shareprice.co.uk every day and hope for the funds to be 'green' in color meaning that they're in credit for the day.

Its also a continual !!!! ache watching them turn red and, over the course of the last 7 years, I've certainly seen a lot of that!!

Ok..so here we are 7 years since July 2009 when I first believed I'd make a fortune playing the stock market ??

From a start of 33k my balance as of today Aug 22nd 2016 is..........just shy of 21k!

So..what happened....what was it that cost me money...and more money...and what were, if any bright suns in my life as a playtime investor???

First of all, up front, I'd have to say that having the mentality of a gambler has not helped at all.

Wanting instant action on a share price in an upwards direction is NOT the way to invest. If you don't like watching paint dry then self-investing is NOT for you!

You need the patience of a angel and need to be able to sit on your hands without clicking on the 'buy' & 'sell' buttons for months or years at a time. If I had to do this again I wouldn't!!

Having said all that then where did it all go wrong??

Well let me say that the £12k difference between my 21k now and the 33k then is simply down to account charges!!

Every sale cost me a tenner at least whilst every purchase cost me loads more once stamp duty was taken into account. I suppose it might be worth my while trying to get a detailed statement from Hargreaves Landsdown as regards how much these 'charges' have added up to but its easily above £10k.

Simply put people I've done over 500 trades in the last 7 years. Kerpow!!

What about share losses ???

The biggest ones I've had are Apple and Glencore.

The biggest winner has been JD Sports.

In between are share purchases / sales as wide and diverse as most of the FTSE 100 at some point or other, most of the FTSE 250 and a dabble in the USA where exchange rates and inferior dealing charges punched holes in my bankroll.

Was it fun?? No...a pain in the !!!!!!!

Here are quarterly figures that shows the breakdown...quarter by quarter...of my last 7 years!!

Date Fund Value Total % Growth in Qtr Total % Growth Overall
6th July 2009 33995.00
30th Sep 2009 38513.07 13.29 13.29
8th Jan 2010 34588.27 -10.19 1.75
31st Mar 2010 34200.31 -1.12 0.60
2nd July 2010 33638.04 -1.64 -1.05
2nd Oct 2010 39367.89 17.03 15.80
2nd Apr 2011 38509.10 -2.18 13.28
2nd Jul 2011 33417.51 -13.22 -1.70
1st Oct 2011 24816.87 -25.74 -27.00
1st Jan 2012 27707.26 11.65 -18.50
1st Apr 2012 29523.55 6.56 -13.15
1st July 2012 23877.31 -19.12 -29.76
1st Oct 2012 24637.21 3.18 -27.53
1st Jan 2013 20951.07 -14.96 -38.37
1st Apr 2013 17318.13 -17.34 -49.06
1st July 2013 16646.07 -3.88 -51.03
1st Jan 2014 21434.45 28.77 -36.95
1st Apr 2014 23117.81 7.85 -32.00
1st Jul 2014 18454.40 -20.17 -45.71
1st Oct 2014 20353.27 10.29 -40.13
1st Jan 2015 21657.12 6.41 -36.29
1st Apr 2015 24716.38 14.13 -27.29
1st July 2015 24569.11 -0.60 -27.73
1st Oct 2015 24773.77 0.83 -27.13
1st Jan 2016 26778.19 8.09 -21.23
1st April 2016 23386.21 -12.67 -31.21

It ain't pretty so let this be a lesson to all you people out there that like to 'Self Invest' and who like the slot machines at the same time

edinburgher

So, do you have other pensions/sources of income to fall back on?

ukpoker

I'm officially retiring at 60.

I have a Section 228 policy with AVIVA taken out in Jan 1988 (Norwich Union - lucky me) that I pay £100 a month into and will receive approx £12- £15k a year from given that the GAR is 10%.

I also have another pension scheme that I currently contribute approx £500 a month into via my current workplace. This should be worth approx £55k at age 60 (started late with this) and have a tiny €10k pension fund from working in Ireland for a few years.

Eric_the_half_a_bee

As you seem to have recognized yourself, you have not been investing, you have been gambling. Gambling is fine, if you can afford to lose the money.

Justanitgeek

33k invested in Vanguard UK equity income in July 2009 would be worth around 70k today, even after SIPP provider charges.

dunstonh

and what were, if any bright suns in my life as a playtime investor???

You were not an investor. You were a trader. It is unlikely you have the skills or knowledge to be a trader.

Its a shame you didnt invest as your £33k in 2009 would probably be up around £21k now rather than being valued at 21k.

Investing is not meant to be fun. It is a means to an end. Often, the more boring the investment is, the better it is for the average consumer. There is no need to make it complicated or go trading into areas you know nothing about. And like anything you do on a DIY basis, if you get it right, you can save money and potentially earn more. If you DIY and get it wrong, then you give a good example.

Thank you for posting as it may help others who think that trading is the way.

ukpoker

Eric_the_half_a_bee wrote: »

As you seem to have recognized yourself, you have not been investing, you have been gambling. Gambling is fine, if you can afford to lose the money.

I've made the post to highlight that UNLESS you like watching paint dry then investing in SIPPS should be avoided.

When you have control over your own money its exciting to 'move' it around like there's no tomorrow.

I suppose I paid £11k for an education. Luckily I can afford to lose the money and at least I have some left for a good old pink Lamborghini

Eric_the_half_a_bee

ukpoker wrote: »

I've made the post to highlight that UNLESS you like watching paint dry then investing in SIPPS should be avoided.

If I invest and then leave my investments alone while getting on with all of the other things I have to do with my life, I do not regard that as "watching paint dry"

dunstonh

I suppose I paid £11k for an education.

Actually, you paid about £35k as its not just what you lost but also what you didnt gain had you gone down the boring route.

ukpoker

Probably true...

enthusiasticsaver

One of the few things I have learnt as an investor is charges destroy profits and you should research your strategy and stick to it. I do not have the knowledge to invest in individual shares so I stick to a global well diversified fund of tracker funds and then leave it alone. Just drip feed £500 per month plus the odd occasional lump sum to bring it up to the isa limit of £15k per year.

Well done on owning your mistakes though and hopefully others will take heed. It looks like you were not doing too badly until 2010 and then it went horribly wrong. Invest and leave alone is the answer and don't check the price every day.