Rate my finances

Alexland

dwtmahdc wrote: »

Hey Alex- 5%, and they add double to it. I then do 3% through AVCs / salary sacrifice. Do you still think it's better off in a LISA? These are the areas I get a little foggy on!

If you get salary sacrifice that's saving a further 12% NI which is broadly equivalent to the 15% tax you would probably pay on drawing income from the AVC in retirement. This assumes the matched 5% and 10% contributions generate enough income that you are a taxpayer in retirement, you draw 25% tax free so end up paying 20% tax on the remaining 75%.

So in this circumstance a LISA would be broadly equivalent to your salary sacrifice AVCs.

I am late 30s, no plans to move until retirement and regret overpaying the mortgage to such an extent. We probably should have stopped at between 30% to 40% LTV. We would have done better long term by making more use of our pension and ISA allowances in those years. I now plan to pay the last 20% of the mortgage as slowly as possible.

Alex

Alexland

jennyjj wrote: »

There's a slightly obscure fund manager Lindsell Train. I personally like their global and UK equity funds for the mid to long term.
Obviously, that is a statement of my unqualified opinion and does not constitute advice.

Not that obscure - last year Lindsell Train was the 6th most popular fund on the UK's largest DIY platform.

https://www.hl.co.uk/news/articles/ten-most-popular-funds-of-2017

jennyjj

Alexland wrote: »

Not that obscure - last year Lindsell Train was the 6th most popular fund on the UK's largest DIY platform.

https://www.hl.co.uk/news/articles/ten-most-popular-funds-of-2017

OK, not obscure, but not a household name. It was HL's league tables brought them to my attention, and their performance graphs that made me fall in love

takesyourchances

dwtmahdc wrote: »

Much appreciated! Tomorrow's job is definitely about looking into spreading more of it into other S&SISAs, and maybe up the investment in the current one.
Fundsmith has caught my eye, but I might dabble with 60% or even 40% as more cautious, shorter term options.

Glad that helped a bit. Another option if you are a bit more cautious would be to transfer from the Vanguard 80% to the 60% version.

As the 80% is higher equity exposure so more volatility. With your age though if you are prepared to give it time you could continue in the 80%. It would be down to the timescale of your needs for this pot.

dwtmahdc

takesyourchances wrote: »

Glad that helped a bit. Another option if you are a bit more cautious would be to transfer from the Vamguard 80% to the 60% version.

As the 80% is higher equity exposure so more volatility. With your age though if you are prepared to give it time you caould continue in the 80%. It would be down to the timescale of your needs for this pot.

The 80 was one with an aim of minimum 10 years, so I'll keep that one ticking over.
Spreading to others allows a more reserved approach

dwtmahdc

Alexland wrote: »

If you get salary sacrifice that's saving a further 12% NI which is broadly equivalent to the 15% tax you would probably pay on drawing income from the AVC in retirement. This assumes the matched 5% and 10% contributions generate enough income that you are a taxpayer in retirement, you draw 25% tax free so end up paying 20% tax on the remaining 75%.

So in this circumstance a LISA would be broadly equivalent to your salary sacrifice AVCs.

I am late 30s, no plans to move until retirement and regret overpaying the mortgage to such an extent. We probably should have stopped at between 30% to 40% LTV. We would have done better long term by making more use of our pension and ISA allowances in those years. I now plan to pay the last 20% of the mortgage as slowly as possible.

Alex

Really helpful, thanks!
My mortgage situation is a little different I think. Hit the jackpot with a flat in Manchester- bought for £105k in 2010, currently valued around £190-200k based on identical flats in the building selling. Literally across the road from HS2 planned depot, so expecting strong rental prospects (current is around £995pcm). Aim is to get mortgage down to near 0 by the time building is finished, and then look to move out to a house further out and take advantage of the boom (fingers crossed, anyway. Watch it all collapse thanks to Carillion).

takesyourchances

dwtmahdc wrote: »

The 80 was one with an aim of minimum 10 years, so I'll keep that one ticking over.
Spreading to others allows a more reserved approach

Sounds good with a 10 year plus outlook for the 80% and in your shoes, I would increase the monthly money into it

forextc

I'd echo one of the comments above re the Sharesave scheme. Yes they can be good value and offer a great way to put some money aside at a discount. However you are likely to end up with very concentrated risk. In the scenario of losing your job it is likely this would likely be tied with a downturn in the company so you would get hit with a double whammy.

Personally I would put less into this and seek diversification in a broader range of equity investments.

dwtmahdc

forextc wrote: »

I'd echo one of the comments above re the Sharesave scheme. Yes they can be good value and offer a great way to put some money aside at a discount. However you are likely to end up with very concentrated risk. In the scenario of losing your job it is likely this would likely be tied with a downturn in the company so you would get hit with a double whammy.

Personally I would put less into this and seek diversification in a broader range of equity investments.

Thanks @forextc- I'm acutely aware of the risk of having the shares in one place. All I ever do is look at the market price. If it's lower than option price I was given, I just withdraw the cash. If it's higher, I convert it into shares and then instantly sell. Absolutely NO way I'm having more than what I already have in them (accidentally, might I add haha. Live and learn!).

Looking into other options as we speak- any suggestions welcome!

atush

dwtmahdc wrote: »

Hey Alex- 5%, and they add double to it. I then do 3% through AVCs / salary sacrifice. Do you still think it's better off in a LISA? These are the areas I get a little foggy on!

With Sal sacrifice, pension is better