Fund choices for SIPP

bostonerimus

enthusiasticsaver wrote: »

My advice would be global multi asset so well diversified. You can choose the level of risk by way of choosing the level of equities to bonds/fixed term deposits. There are lots around. Vanguard Lifestrategy funds are popular on here but Legal and General multi asset and Blackrock consensus are all similar. Look at the charges as well as the annual returns.

Where was it invested before and was there a reason you wanted to move it?

Trustnet, Morningstar and Monevator are all good places to read up on them.

In the accumulation phase I'd say a VLSxx fund would be just fine, but in drawdown it's a bit more complicated and we really need to know the income requirements and the range of other investments and income sources available.

Jet123

Hi I did not have a choice about moving the money I was transferred to my current employer who did not guarantee the same pension arrangements

DairyQueen

Jet123 wrote: »

Hi thanks for your reply, I have other savings I can access before SP kicks in. My plan is to view the Sipp is more a longer term investment.

I faced a similar challenge to you and realised (thanks to the forum experts) that fund selection is the final stage of a process. The selection depends on many variables and those variables are defined by reference to some key questions. The trick is to ask yourself the right questions, and then to understand how your answers are framed within the investment landscape.

The experts here are guiding you towards the right questions and also providing the information you need to frame the answers. The answers will be the inputs you need to select your funds. Your own research will help you to to test the suitability of specific suggestions.

One of the key questions is the investment timeframe. You mention 'longer term' but what does that mean to you? 5 years? 10 years? Longer?

The above quote suggests that you will begin accessing this fund at SP? Is that right? If so, as you are now 61, this is not a 'longer term' investment IMO.

Your attitude to risk is another key question. Your initial post suggests that you have a cautious approach to risk. As has been mentioned by other posters, it's impossible to invest in markets without taking risk. Even investments considered 'low risk' (e.g. gilts/bonds) carry risk.

Risk is generally mitigated by, for example, a long-term investment horizon (at least 10 years).

I am a few years younger than you and plan to begin accessing our self-invested retirement funds in around 5/7 years. However, our essential expenses are covered by DB/SP and we also have sufficient cash to cover discretionary spending for some years. This will allow us to delay/halt drawdown in the event of a market crash, or sustained dip, at any point pre/post retirement.

The investment timescale was a big factor in my fund selection. I decided to divide our total fund into three tranches. Each has a different timescale that broadly fits within a three-stage retirement plan: mid 60s to early 70s, early 70s to early 80s, and early 80s until whenever we drop off the perch.

Unsurprisingly, I have more of the third tranche (20+ year timescale) invested in equities than in tranche one (5/10 year timescale). As I am not an expert I kept things simple and used global, risk-weighted funds to achieve the balance I wanted for each tranche. Vanguard Life Strategy, Blackrock Consensus, L&G Multi-index, are examples of these types of funds.

I may also dabble a little with funds that focus on sectors not generally covered by these core holdings (e.g.smaller companies) or to provide more exposure to specific types of business or regions. However, I don't intend running before I can walk in a straight line.

I have discovered that there is no one-size-fits-all solution, and no substitute for self-learning in order to make informed decisions. Your age suggests that you need a very clear idea of how you will use your SIPP funds, and when you will access them. That's the first stage.

Pointer: keep reading all of the threads on this forum; it has been hugely helpful to me.

Good luck.

xylophone

Hi, I have recently opened a Sipp with Telegraph Investors and transferred a pension in cash from a previous employer (£160000), I am 61 and thinking of retirement in the next 2 years.

Hi I did not have a choice about moving the money I was transferred to my current employer who did not guarantee the same pension arrangements

I am very puzzled by this - what exactly happened?

Do you have a pension with your current employer?

And have you checked your state pension statement?

bostonerimus

Jet123 wrote: »

Hi I did not have a choice about moving the money I was transferred to my current employer who did not guarantee the same pension arrangements

If you can tell us your income needs (how much and when) and a bit about your other investments, savings and pensions, we can have a go at telling you how we think your SIPP might be invested. Have you done a budget and checked on your state pension amount?