Suggestionms for my final 25% ?

gudda96

Hi Guys

After receiving some good advice on this forum, AND my own concerns, I have scaled down on equity funds. (as I am 78)

My portfolio now is

HSBC global strategy balanced acc 25%
Vanguard LS 60/40 25%
LTGE 25%
Cash ready 25%

Should I consider CGT or increase HSBC and leave it at that.

barnstar2077

This still seems a bit aggressive to me for your age. I know Lindsell train's returns have been good but it is still a managed fund and we know how things can change quite rapidly (eg Woodford.) I would personally have that 25% in a bond fund instead. I guess it depends on how much you depend on this money to live on, and if you have dependants that will inherit it someday as to how much growth you feel you need.

Albermarle

Should I consider CGT

If you mean Capital Gearing Trust , that is a good defensive holding.

gudda96

barnstar2077 wrote: »

This still seems a bit aggressive to me for your age. I know Lindsell train's returns have been good but it is still a managed fund and we know how things can change quite rapidly (eg Woodford.) I would personally have that 25% in a bond fund instead. I guess it depends on how much you depend on this money to live on, and if you have dependants that will inherit it someday as to how much growth you feel you need.

I just thought that my HSBC took care of having a good spread.
Also thought that my 60/40 gave me a decent amount of bonds
what is a typical bond fund? not ls 60/40?

gudda96

Albermarle wrote: »

If you mean Capital Gearing Trust , that is a good defensive holding.

Yes, that's who I mean

Eco_Miser

gudda96 wrote: »

I just thought that my HSBC took care of having a good spread.
Also thought that my 60/40 gave me a decent amount of bonds
what is a typical bond fund? not ls 60/40?

A typical bond fund would be 100% bonds.
A typical balanced fund might be 60/40.

If you want a balanced portfolio you would go for 60/40 (or 50/50, or whatever you think appropriate) across your entire portfolio. Ie. 40% or more bonds/cash in total.

Alexland

If you are still in the accumulation phase at 78 on this investment then you only need a good multi asset fund (no more than one per account) or a 2 fund portfolio of an equity tracker and bond fund rebalanced every so often.

If you have started drawing income then perhaps a fixed allocation 3 asset portfolio of equities, bonds and cash (or short dated currency hedged bond fund)? Then draw down from the one that is overweight each time you take income.

Alex

gudda96

Alexland wrote: »

If you are still in the accumulation phase at 78 on this investment then you only need a good multi asset fund (no more than one per account) or a 2 fund portfolio of an equity tracker and bond fund rebalanced every so often.

If you have started drawing income then perhaps a fixed allocation 3 asset portfolio of equities, bonds and cash (or short dated currency hedged bond fund)? Then draw down from the one that is overweight each time you take income.

Alex

Shall try to answer>>>the portfolio is 40k, not a lot by amounts discussed on MSE and Cutywire forums, but a fact. Requirements, to earn any income that we can from it, but to protect capital to leave to our 2 kids. I am not an expert on the details, but I know the gist is, more income one tries for, increases any risk on capital loss. I realise a bond makes it safer, but how much would that shrink any hope of growth.

For the record, what I normally do, is treat any growth as income, by cashing in the amount of growth to treat as income or dividend.

Hope this claries a little

Prism

It looks absolutely fine to me. LTGE is likely on the safer side of an equities fund with its high allocation to defensive companies. For the last 25% I would actually leave it in cash. Split it across maybe instant access and 1-3 year fixed savers. Maybe around 2.5k in each on your numbers. Should be able to get around 1.8% on average at the moment although it depends on if you have to pay tax on it.

All that should keep you to your roughly 60/40 allocation

DrSyn

It looks far better than what you started out with.

If you did add CGT, it would make your portfolio more defensive. Which at 78, is a good thing.

As Prism suggests you could just keep it as cash. This would also make it defensive.

Alexland

Holding some in cash and bonds helps reduce the pound cost ravaging when trying to maintain a constant income from an otherwise volatile investment.

How important is this income to maintaining your qualify of life? If you have other stable sources of income that meet your needs then it may be that you would be happy to draw a reduced amount (or nothing) when markets are low in order to preserve capital?

Alex