Investing 50k

chamberino

Hi,

I’m looking to invest my savings to make it work for me a bit more than savings accounts will. I have around 50k. Currently 32k is in a Nationwide ISA and the rest is in a mix of my current account and various investment platforms.

I’ve dipped my toes in and learnt a bit by investing a few thousand. I tried these platforms out:

Vanguard LIfeStrategy 80% equity fund - 16% on 2k over 18 months. 4% in July
Nutmeg 5/10 risk pot - 4.38% over 18 months. 1.54% in July
Wealthify - 7.18% over 6 months. 4.8% in last 3 months.
Wealthsimple - something similar to nutmeg/wealthify

Looks like vanguard outshines the others, but is there a meaningful difference between them?

I also had £500 in Lendy. From which I have learned a (fortunately not too severe) lesson about the reliability of the platform! I am ok if things go bad happens and I lose 20%. Is this the worst that would happen outside of a 0.01% catastrophe in which everything sinks?

I am 30 and may want to buy a house in the next few years, but unsure when. As I say, the risk of losing money is a concern, but can accept some risk.

Probably one of the key things is that I don't want to have to think about it once I put the money in except to check it every so often and see how much it's gone up (or down!). It's fine if this results in slightly lower profits.

My main questions are
* put it all in Vanguard or do I need to spread out over several platforms? should I just keep a minimal amount as cash?
* is vanguard as good as it appears from my experience?
* transfer the whole ISA from nationwide to a stocks and shares ISA?
* If one of the platforms disappears am I reasonably safe, unlike Lendy?
* I’d like to not invest in fossil fuels, companies with poor labour practices etc. Is this hard to find?

SonOf

I tried these platforms out:

None of the ones you list are platforms. 3 are robo-guidence services and one is an investment fund (which may be held on a platform)

I am 30 and may want to buy a house in the next few years, but unsure when. As I say, the risk of losing money is a concern, but can accept some risk.

When you say next few years do you mean next few years (as in around 2 years)?
When you say you can accept some risk what do you mean by that?

Investing in VLS80 for 2 years when you need the money for a house deposit is damned high risk.

My main questions are
* put it all in Vanguard or do I need to spread out over several platforms? should I just keep a minimal amount as cash?
* transfer the whole ISA from nationwide to a stocks and shares ISA?
* If one of the platforms disappears am I reasonably safe, unlike Lendy?
* I’d like to not invest in fossil fuels, companies with poor labour practices etc. Is this hard to find?

VLS is meant as a one stop solution
However, VLS is not consistent with your last point (and yes that is easy to sort)

That said, I think you are underestimating the risks you are taking

cattie

At your age I'd be thinking more about my long term goals & would invest my money not needed for house purchase via just one of the better value platforms. Vanguard is fine if you just want to invest in their funds, but not if you'd like more choice. There are other multi asset funds from other providers that will suit.

It's unlikely that a reputable & long standing platform is going to disappear & at £50k you have no need to worry if the total amount of investment will be covered by FSCF.

You just need to remember that stock markets do fluctuate & at some point your holdings will perhaps suffer a loss, but as long as you've not invested all your spare cash into S&S, eventually things will be on the rise. As the saying goes, there's no gain without pain.

sendu

chamberino wrote: »

Looks like vanguard outshines the others, but is there a meaningful difference between them?

The robo-advisors are giving you (effectively or actually) actively managed funds, where some member of their staff thinks they know better than all other investors in the market, and makes a bet that some subset of the market will outperform the rest, so they invest more there.

As you've found out, and as all their long-term performance data will show, they don't know better. They all underperform the stock market average return over the long term.

The LifeStrategy fund is also a fund of funds, and has a UK bias, and the equity portion of it could (and probably does) also underperform the stock market average.

If you want good performance while staying broadly diversified, try Vanguard's FTSE Global All-cap fund, which will give you something close to the average return. You'll need to additionally hold some percentage of bonds or cash to match your risk appetite.

I am 30 and may want to buy a house in the next few years, but unsure when. As I say, the risk of losing money is a concern, but can accept some risk.

It's a big risk to take on this time scale, and not worth it for most people. If you start putting money in to a LISA (assuming this is going to be your first house, and you are otherwise eligible), you get a guaranteed 25%/yr from the government, which will likely dwarf any stock market returns.

My main questions are
* put it all in Vanguard or do I need to spread out over several platforms? should I just keep a minimal amount as cash?
* is vanguard as good as it appears from my experience?
* transfer the whole ISA from nationwide to a stocks and shares ISA?
* If one of the platforms disappears am I reasonably safe, unlike Lendy?
* I’d like to not invest in fossil fuels, companies with poor labour practices etc. Is this hard to find?

Vanguard (the platform) are great, but not the cheapest above about £24k invested, and they don't offer a LISA.You can buy their funds on other platforms.

Alexland

If you are looking to buy a property in the next 5 years then cash products are the only suitable choice for any money associated with that purchase. Otherwise there is a real possibility you will withdraw less than you contributed or could have achieved with cash interest. Using S&S in these circumstances is a gamble.

Consider a cash Lifetime ISA if suitable for the 25% bonus on your contributions.

As for long term investments ensure you are making enough pension contributions to be tax efficient and harvest the maximum employer contributions.

But yes if all you want is a mostly passive S&S ISA then Vanguard Investor are hard to beat on modest amounts. But if you want to pick funds with ethical screening then you might need to pay a bit extra and go with Cavendish.

I no longer have any money in P2P.

Alex

DrSyn

Have you considered using a Vanguard Target retirement fund for at least part of your pension money?

You would not need to have a look at this so often.

https://www.vanguard.co.uk/adviser/adv/investments/about-funds/target-retirement-funds

chamberino

Thanks all very much for your advice.

It seems like the general tone is “don’t invest money now if you need it sometime in the next 5 years”. It seems like it would be sensible for me to invest a small amount but not more than say 5k in the FTSE Global All-cap. Which other provider would be good?

I do already have a lifetime ISA which I have put the maximum amount in.

I don’t have a pension as I’m an an IT contractor with a ltd company and a partner in a partnership, should I get a pension anyway? I also assumed that everything I have will need to go towards a house anyway in the near future.

In terms of risk, what might I end up with in 3 years say if things went badly investing? I understand I could end up with less, but how much less?

Linton

chamberino wrote: »

........

I don’t have a pension as I’m an an IT contractor with a ltd company and a partner in a partnership, should I get a pension anyway? I also assumed that everything I have will need to go towards a house anyway in the near future.

Gulp. I suggest you find out.

In terms of risk, what might I end up with in 3 years say if things went badly investing? I understand I could end up with less, but how much less?

In 2000-2003 the FTSE World Index dropped by 50%. In 2008-2009 it dropped by 40%. Of course by ill-considered investing you could have got much larger falls.

chamberino

Would it be sensible for me to invest in something safe like government bonds? A friend has made this recommendation.

SonOf

chamberino wrote: »

Would it be sensible for me to invest in something safe like government bonds? A friend has made this recommendation.

Investing in a single sector is high risk. I suggest you dont take advice from a friend who doesnt understand investing.

Gilts are not safe. They have risks and where we are at a stage in the cycle when the risks are higher than normal.

xylophone

I don’t have a pension as I’m an an IT contractor with a ltd company and a partner in a partnership, should I get a pension anyway?

For information only

https://www.pensionbee.com/pensions-explained/pension-contributions/contributing-to-your-pension-from-your-limited-company

https://monevator.com/index-investing-guide/

You have a wide choice of pension providers.

https://www.thisismoney.co.uk/money/pensions/article-5937747/How-pick-best-cheapest-Sipp-build-pension-investments.html