Should I keep investing into VLS?

Corbula

I opened a Stocks and Shares ISA In Feb of last year with Charles Stanley Direct and put £12k into the Vanguard Lifestrategy 80. I've not put anything more into that since then.

I'm also saving money for a house deposit and a new car in a couple of years. Mostly likely two to three years. So I've got a HTB ISA which I've been doing the maximum I'm allowed since I opened it and currently sits at around £5,500. I also have £3k in a Tesco account which gives 3% without any requirements. This will be going with the money in the HTB ISA for a house deposit in the next few years. Along with any other money I've got saved in my current account.

I have a cash ISA which I could dip into to help with a house deposit should I need to but I plan to leave that as is.

I've been thinking that I should be continuing to put money into my Stock and Shares ISA to get the most benefit rather than just leaving it for the next few years. Say £200 a month.

Given my situation and goals would you say this would be a good idea medium to long term or would you advice something else?

Also if I keeping investing into my Stocks and Shares ISA going forward would you recommend keeping investing in the Vanguard Lifestrategy 80 or another fund given how USA heavy the fund is at the moment?

Thanks all.

A_T

If anything VLS is light on the USA. America accounts for roughly 50% of the global stock market but VLS only gives about 35%.


For me the problem with VLS is that it is overweight to the FTSE 100.

Alexland

VLS equities are 43% US.

I am unclear if you are saying you might use the S&S ISA towards the house deposit in which case stock market investing (particularly in high volatility funds such as VLS80) should be done with at least a 5 years outlook preferably longer to reduce the chance of needing to sell when markets are low.

Alex

Joe_Bloggs

Why not open an additional current account with Nationwide? Their Flexdirect pays 5% on up to £2500. You can also get a Regular Saver of up to £250 per month at 5%. They are also a significant mortgage lender.
I should point out that I do not just favor Nationwide's accounts but also use Santander, Lloyds, Halifax and Tesco.
J_B.

capital0ne

Alexland wrote: »

VLS equities are 43% US.
Alex

This is incorrect no where near 43%
Vanguard LifeStrategy 80% Equity A
(https://toolkit.financialexpress.net/eacs/factsheet/en-gb/commshare/?TypeCode=FU:ACDT&specialunittype=&priipproductcode=)
1 North American Equities 34.64%
2 UK Equities 19.80%
3 Global Fixed Interest 14.20%
4 Europe ex UK Equities 9.99%
5 Global Emerging Market Equities 6.60%
6 Japanese Equities 5.63%
7 Asia Pacific ex Japan Equities 3.14%
8 UK Gilts 2.60%
9 UK Index-Linked 1.80%
10 UK Corporate Fixed Interest 1.60%

pinkllama

Each Lifestrategy fund has ~43% of its equities in the US, not 43% of the fund.
E.g LS80 has 34.69% in the US. Minus 20% (bonds) from 43% and you get the 34.69%.

ColdIron

Depends how you measure it. North American equities make up 34.7 of the fund according to Vanguard's latest factsheet. However the VLS80 has 20% bonds so North American equities make up 43.3% of the the equity component which neatly matches the VLS100 factsheet

Corbula

Sorry, to clarify I'm not intending to use the Stocks and Share ISA towards a house deposit. That money is for later in life.

My HTB ISA, my Tesco one and what's in my current account at the time is going towards a house deposit and hopefully next car.

For me, the accounts like the Nationwide Flexdirect aren't really worth the small return to me. As it's only on £2500 and that 5% is only for a year. Plus I don't know if I could keep putting £1000 in each and every month. I know a lot of people will disagree as any money is a bonus but £125 for a year and then having to move it again isn't worth it to me.

bostonerimus

Invest regularly and invest often. VLS are a good family of funds. Stop worrying about US weighting etc and make sure you are maximizing pension and ISA contributions into low cost sensible funds.....like VLS.

pjcox2005

I think key action would be to transfer help 2 buy into a LISA if you're not looking to buy in the next 12 months. Can save £1,600 more per year in it so that's £400 a year from the government that you're missing out on.

If you have spare funds then I'd keep ploughing if in to stocks and shares and would keep it simple with VLS. Sounds like you have cash savings as a back up if needed rather than breaking the stocks and shares.

Other option is to consider peer to peer lenders (ratesetter etc) and put money in those to get the sign up bonuses.

Alexland

capital0ne wrote: »

This is incorrect no where near 43%

You are counting bonds in your numbers. That's not the right method to determine the geographic distribution of stocks.