Pension Investment Strategy

LHW99

I would also point out that, at the minute I am basing my figures off of my pension, plus SP. DW has only recently started 're training in a new career on a very low apprentice wage. She actually has been enrolled into the LGPS, which I realise is DB. Waiting on more info about this to really add it to the plans, but at the minute I am working with what I have and if we can achieve our goals with that, then everything else will be a bonus.

Quite a reasonable approach at the moment IMO, but when the information is to hand, you should also think about making sure you would both be OK separately should the proverbial bus arrive for one of you.

Pip_Boy_111

LHW99 wrote: »

Quite a reasonable approach at the moment IMO, but when the information is to hand, you should also think about making sure you would both be OK separately should the proverbial bus arrive for one of you.

Thanks

This is what I intend to do. Will need to look into DW's SP too.
Long term i want to start paying into a S+S isa too. I

I must admit it's all quite daunting to start with and, inevitably, the learning will continue but I refuse to leave it too late like so many do.

bostonerimus

I think you are doing very well. You are starting relatively young and you have the potential to get some diverse retirement income sources. The LGPS DB benefit along with SP would be a great foundation for a solid retirement and your DC investments will provide some flexibility.

Many times people over think asset allocation. I’ve basically had a 60/40 equity index to bond index portfolio made up of just 3 funds for most of my investing life and I’ve managed an 8.5% annual average return for the past 30 years by using a simple rebalancing approach and mostly ignoring the ups and downs of the markets. I’ve done well enough that I don’t mind taking risk in retirement so now I’m 75/25 and I plan to allow the equity percentage to increase as I get older. The key to success is having a plan that will survive the tough times and give you simple rules to follow so you don’t panic.

AnotherJoe

Pip_Boy_111 wrote: »

I haven't read these no. I assume a Google search will turn these up? Will have a look for these. Thanks.
.

UK based The Escape Artist
US based (and very hard core) Mr Money Mustache
General investments ramblings Monevator.

bostonerimus

AnotherJoe wrote: »

UK based The Escape Artist
US based (and very hard core) Mr Money Mustache
General investments ramblings Monevator.

http://www.early-retirement.org

is a US based ER forum that has lots of good general content and contributors.
I would definitely start the S&S ISA as that gives you lots of flexibility and can be used to minimise taxable income...and of course you get tax free growth.

I think OP is addressing the investing side of their finances quite well and maybe they can now look at the budgeting and spending side.....saving a penny gives you the greatest return and it's risk free.

Pip_Boy_111

bostonerimus wrote: »

http://www.early-retirement.org

is a US based ER forum that has lots of good general content and contributors.
I would definitely start the S&S ISA as that gives you lots of flexibility and can be used to minimise taxable income...and of course you get tax free growth.

I think OP is addressing the investing side of their finances quite well and maybe they can now look at the budgeting and spending side.....saving a penny gives you the greatest return and it's risk free.

Thanks will take a look. I'm enjoying the escape artist.

As for budgeting, we are already on it. I won't go into masses of detail but I have a DFW diary on here that details what's going on.
The future plans are to use the snowball payments, as they become available, to save/invest. Any future pat rises will have half put to either pension or s+s isa to avoid lifestyle inflation.
My LBM was not just about debt. It was a complete change of mindset towards finances and the future. I wish I'd been more sensible in the past but with the plans in place, and with a bit of advice and luck along the way, the future looks a lot better. :T

Pip_Boy_111

Hi all. A quick update:

I phoned my company pension provider today to ask about switching funds more than once and what fees are involved. It turns out that, unlike our old provider, i can switch funds as many times as i like without penalty or fees. Excellent news.

I am now in the process of deciding what to do with my money. Following on from comments on here I am thinking of spreading my investments as follows:

Global Equity Ex UK - 65%
UK Equity - 25%
Emerging Markets - 10%

Having considered a few points mentioned here and reading through some FIRE blogs, I believe (hope), that with 25+ years to go, 100% equities will give the potential for the greatest returns (albeit with the volatility that comes with it) and the ability to ride out any dips in the next few years. Depending on future performance and circumstances the option to shift to more of a bond allocation is there closer to retirement.

Am i thinking along the right lines here, or is this a crazy plan and I just can't see it?

Again, sorry for asking, what may seem like basic questions. I do read and study, but I have no previous experience to draw on of my own, so can only ask others of their opinions and thoughts.

Many Thanks again

foofi22

Sounds all very reasonable. Like I said earlier, I am already taking a very similar strategy so I'm inclined to agree with you!

My work pension provider also offers some smaller company funds which I have included with small allocations.

With annual rebalancing, I expect to continue this theme until my late-40's/early 50's (scary!!!) when I'll start reducing the equity exposure.

Pip_Boy_111

foofi22 wrote: »

Sounds all very reasonable. Like I said earlier, I am already taking a very similar strategy so I'm inclined to agree with you!

My work pension provider also offers some smaller company funds which I have included with small allocations.

With annual rebalancing, I expect to continue this theme until my late-40's/early 50's (scary!!!) when I'll start reducing the equity exposure.

Thanks for the reply.

It's such a relief that I can switch funds whenever and without a fee involved as per the old provider. Thanks for taking the time to look over my plans. Like I say, you can read all you like but until you build up experience you're never quite sure if you're on the right track.

AnotherJoe

Pip_Boy_111 wrote: »

Hi all. A quick update:

I phoned my company pension provider today to ask about switching funds more than once and what fees are involved. It turns out that, unlike our old provider, i can switch funds as many times as i like without penalty or fees. Excellent news.

I am now in the process of deciding what to do with my money. Following on from comments on here I am thinking of spreading my investments as follows:

Global Equity Ex UK - 65%
UK Equity - 25%
Emerging Markets - 10%

Might as well get vls100 and a EM investment

Having considered a few points mentioned here and reading through some FIRE blogs, I believe (hope), that with 25+ years to go, 100% equities will give the potential for the greatest returns (albeit with the volatility that comes with it) and the ability to ride out any dips in the next few years. Depending on future performance and circumstances the option to shift to more of a bond allocation is there closer to retirement.
Old fashioned approach. If you will remain invested for years after retirement that's too early to scale back

Am i thinking along the right lines here, or is this a crazy plan and I just can't see it?

Again, sorry for asking, what may seem like basic questions. I do read and study, but I have no previous experience to draw on of my own, so can only ask others of their opinions and thoughts.

Many Thanks again

I think you'll find that putting 25% in "the U.K." is harder than you envisage. You'll likely find you end up with huge multinationals that are nominally HQ'd here but the bulk of whose revenue is overseas and might as well be global.