Complete beginner

chockydavid1983

Nothing wrong at all with using the same platform for both. Worth checking platform costs for each for planned number of funds, trades etc:
http://www.comparefundplatforms.com/
With VLS 100, you need to be prepared for a lot of volatility. As you go down towards VLS 20 for example, the returns are *likely* to be less but also less volatile

atush

bigadaj wrote: »

In regard to pensions then I very much doubt the OP is contributing the maximum amount, given that this is £40k per year, or actually higher given that they are a higher rate taxpayer with no doubt carry forward available.

Pension will beat most things but it will be tied up for fifteen years, as you get an effective immediate uplift from the tax savings, and it can get your child benefit back at teh £50k level as well.

Yes, we need to revisit this. Are you sure you are putting on 40K per year? Or are you putting in t he max that the employer will match? Just because it isnt matched, doesnt mean you cant add more?

If you have income in excess of 40K you want to put in the pension, have you put in less than 40K in any of the 3 last tax years?

todd89

Thanks guys.

I think that sounds like a wise move - VLS 60/40 in the SIPP and VLS100 in an ISA for more risk. Using the comparison website above (which was very useful, thanks!) suggests that it's better in the long run to stick a 5k initial lump and 200 per month in an ISA rather than going 50/50 split between SIPP and ISA; however, I want to tie up half of it so I am not able to spend it! Therefore SIPP and ISA sounds sensible!

I quite like the idea of having a world tracker fund but the VLS one is an ETF and I've read ETFs are more suited to larger investments.

Do you know any world funds that are not ETF?

JohnRo

Would it not be wiser to place the higher risk fund in the wrapper that prevents access for the next 28 years?

Use the ISA for a somewhat lower risk fund so that if bad things happen and you find yourself unavoidably needing some or all of the ISA money, temporarily or permanently, you can be reasonably certain that if that event happens in the middle of a severe market downturn you'd probably have more available. Also that, in those circumstances, the damage from the withdrawal impact would be less severe in terms of eventual recovery.

That's assuming the amounts are to be evenly split.

chockydavid1983

That would be my general thought too

todd89

JohnRo wrote: »

Would it not be wiser to place the higher risk fund in the wrapper that prevents access for the next 28 years?

Use the ISA for a somewhat lower risk fund so that if bad things happen and you find yourself unavoidably needing some or all of the ISA money, temporarily or permanently, you can be reasonably certain that if that event happens in the middle of a severe market downturn you'd probably have more available. Also that, in those circumstances, the damage from the withdrawal impact would be less severe in terms of eventual recovery.

That's assuming the amounts are to be evenly split.

That's a good point. Something like the 60/40 VLS or 80/20 for the ISA.

Fatbritabroad

todd89 wrote: »

I think I've just found the answer - correct me if I'm wrong! - the ISA is the empty wrapper and I decide what I want to invest in. So would be nice if you guys can give me some direction.

todd89 wrote: »

That's a good point. Something like the 60/40 VLS or 80/20 for the ISA.

Other products are available do your own research

Fatbritabroad

JohnRo wrote: »

Would it not be wiser to place the higher risk fund in the wrapper that prevents access for the next 28 years?

Use the ISA for a somewhat lower risk fund so that if bad things happen and you find yourself unavoidably needing some or all of the ISA money, temporarily or permanently, you can be reasonably certain that if that event happens in the middle of a severe market downturn you'd probably have more available. Also that, in those circumstances, the damage from the withdrawal impact would be less severe in terms of eventual recovery.

That's assuming the amounts are to be evenly split.

Thats a very good idea. Mines in my work pension and I do have the option to move it in to other products if I want. I need to do some research into what's available. The work pension is via aegon. I also need to check the charges. The headline rate is 1% but we get a rebate on this so ours is substantially less which is why I've left it alone but I am considering whether to switch funds or even take some out into a sipp to do what you've said and move up the risk scale. I'm still at the 'a little knowledge is a dangerous thing' stage at the moment though so don't want to mess with my larger retirement fund until I have more confidence. I'll probably end up leaving it tbh

elephantrosie

this is an amazing thread. gonna bookmark it!

AndyT678

todd89 wrote: »

Thanks guys.

I think that sounds like a wise move - VLS 60/40 in the SIPP and VLS100 in an ISA for more risk. Using the comparison website above (which was very useful, thanks!) suggests that it's better in the long run to stick a 5k initial lump and 200 per month in an ISA rather than going 50/50 split between SIPP and ISA; however, I want to tie up half of it so I am not able to spend it! Therefore SIPP and ISA sounds sensible!

I'd agree with JohnRo - less risk in the ISA makes a bit more sense to me if you might need access to it.

todd89 wrote: »

I quite like the idea of having a world tracker fund but the VLS one is an ETF and I've read ETFs are more suited to larger investments.

Do you know any world funds that are not ETF?

That's quite a lot of wrongness in one sentence! The VLS products are not trackers nor are they ETFs. I'm guessing maybe you mean Vanguard FTSE All-World UCITS ETF VWRL which is both a tracker and an ETF.

There's no particular rule to say that ETFs are only suitable for large investments but they are not necessarily suitable for novice investors. There's no FSCS protection on ETFs and you need to understand the differences between full, partial and synthetic replication.

There are many world tracker funds that are not ETFs. Here's one HSBC Index Tracker Investment Funds - FTSE All-World Index Fund.