Aviva Pension - Funds Choice

Be_In_That_Number

Hi there

I'm hoping to get some guidance around how to choose my options for my workplace pension with Aviva.

A couple of bits of background information. I'm 33, investing 14% of my earnings of which 5% are matched by my employer into my pension. Over the past 4 years with this employer, I've grown my pot to c.£40,000 (with a similar sized pot with my previous employer) but the growth seems very sluggish (and projections don't leave with with the size of pot I'd hope for).

Aviva offer a range of options I can choose from. Primarily these are:
1) Follow one of 'low-involvement' investment path.
2) Choose from a range of 234 investment funds.

The default investment plan I'm signed up to is this one.

I'm far from a funds expert, but I'm not convinced that this is the right approach for me given my age and the high proportion of bond allocations.

Elsewhere, I have S&S in VLS80 and would ideally do something similar for my pension. I'd really appreciate your views on if my thinking makes sense and if anyone is in a similar position (and can suggest sensible steps).

This is one of the other 'low-involvement' options which I believe might be more appropriate?
http://www.fundslibrary.co.uk/fundslibrary.dataretrieval/documents.aspx/?user=ed6EZC8EJvB2hpGCjdY9kb8cONaSZjHV80RQ5%2bTKKHc%3d&type=packet_lp_fund_unit_doc_factsheet&sedol=B8KLWY6&r=1

Thanks in advance for any views!

Linton

Trustnet tells me that your fund is consistently showing an average performance marginally above VLS60. Why do you think its growth has been very sluggish? This past year has been difficult for most global funds with VLS60 showing a return of 0.9% and VLS80 1.5% compared with your finds return of 0.7%. Previous years have been much better for all 3 funds.


PS your link to tyhe funds available doesnt work for me.

Audaxer

Be_In_That_Number wrote: »

Hi there

I'm hoping to get some guidance around how to choose my options for my workplace pension with Aviva.

A couple of bits of background information. I'm 33, investing 14% of my earnings of which 5% are matched by my employer into my pension. Over the past 4 years with this employer, I've grown my pot to c.£40,000 (with a similar sized pot with my previous employer) but the growth seems very sluggish

The factsheet for your fund shows a 48% total return over 5 years which isn't sluggish for what is a medium risk, globally diversified mixed asset fund.

I'm far from a funds expert, but I'm not convinced that this is the right approach for me given my age and the high proportion of bond allocations.

Elsewhere, I have S&S in VLS80 and would ideally do something similar for my pension. I'd really appreciate your views on if my thinking makes sense and if anyone is in a similar position (and can suggest sensible steps).

This is one of the other 'low-involvement' options which I believe might be more appropriate?
http://www.fundslibrary.co.uk/fundslibrary.dataretrieval/documents.aspx/?user=ed6EZC8EJvB2hpGCjdY9kb8cONaSZjHV80RQ5%2bTKKHc%3d&type=packet_lp_fund_unit_doc_factsheet&sedol=B8KLWY6&r=1

Thanks in advance for any views!

Your second link doesn't seem to work, but I agree that you are likely to get better long term returns from a fund with a higher percentage of equities like VLS80. Bear in mind that a VLS80 or VLS100 will be more volatile and could fall 30% or 40% in an equity crash, which could easily happen in the next few years. Returns over the next 5 years are probably not going to get anywhere near the last 5 years as markets have been on a long bull run of high returns.

Be_In_That_Number

Oops, hopefully this one works?

In terms of my criticism of my current fund, I guess it was more centred on it possibly being a little too low risk? But perhaps that is naive of me?

Linton

Be_In_That_Number wrote: »

Oops, hopefully this one works?

In terms of my criticism of my current fund, I guess it was more centred on it possibly being a little too low risk? But perhaps that is naive of me?

Yes - that fund is extremely close to VLS80. In my view the asset allocation is better than VLS80 with a much smaller UK allocation.

Audaxer

Be_In_That_Number wrote: »

Oops, hopefully this one works?

In terms of my criticism of my current fund, I guess it was more centred on it possibly being a little too low risk? But perhaps that is naive of me?

It looks well diversified to me if you are happy with no home bias, i.e. a low percentage of UK equity. I'm a bit surprised the factsheet doesn't appear to show the ongoing costs for the fund, but I assume the returns shown are net of costs.

I agree at your age, a high equity percentage shouldn't be a problem. Just don't panic when there are equity crashes as at these times you will benefit from purchasing units at bargain prices.

dunstonh

but the growth seems very sluggish (and projections don't leave with with the size of pot I'd hope for).

Projections use assumptions and are synthetic. They have little to do with the fund(s) you invest in. Indeed, pick one of the thousands of alternatives and hey presto, you get the same projection.

Be_In_That_Number

Thank you, helpful to bounce this off to get some opinions. I think I'll likely make the change or even split my existing pot across the two for some balance.