Advice Required....plus a bit of background.

LotsToDo

John_Smith_2019 wrote: »

From the information you've given, I would NOT get involved in BTL.
That is is only for major players who really know what they're doing.

Cheap multi-asset fund is probably your best starting point. VLS etc.

Multi asset....vls....can you explain a little bit please. Are there any books or anything you would recommend? My knowledge of this is limited.

LotsToDo

John_Smith_2019 wrote: »

Dave Ramsey:
''Mutual funds are the answer''
''Sorry, what was the question..?''

Lol I find trying to convert his savings info uk equivalent difficult......but the remainder of the plan 100% worked for me and completely altered everything for me and my family. So am very grateful for the principles.

LotsToDo

Can you have a cash isa and a s and s isa?

kinger101

If you need the £60K to purchase a bigger home in the near future, you really shouldn't be investing it. It will need to stay in savings accounts. Protected by the FSCS. Which means making sure the deposit doesn't exceed £85K.

You should be able to get 1.45% on an instant access account. A bit more if you tie it up for at least a year. Not quite as much as inflation, but safe for short-term holdings.

VLS is Vanguard Life Strategy. A series of low cost funds varying in the mix of bond/stock ratios according to desired risk. Might be suitable as a choice of investment for your pension.

You don't state whether your business is a company, but making pension payments through that can be more tax-efficient than paying the contributions yourself. An accountant would be able to advise you on this.

LotsToDo

kinger101 wrote: »

If you need the £60K to purchase a bigger home in the near future, you really shouldn't be investing it. It will need to stay in savings accounts. Protected by the FSCS. Which means making sure the deposit doesn't exceed £85K.

You should be able to get 1.45% on an instant access account. A bit more if you tie it up for at least a year. Not quite as much as inflation, but safe for short-term holdings.

VLS is Vanguard Life Strategy. A series of low cost funds varying in the mix of bond/stock ratios according to desired risk. Might be suitable as a choice of investment for your pension.

You don't state whether your business is a company, but making pension payments through that can be more tax-efficient than paying the contributions yourself. An accountant would be able to advise you on this.

My business is now a Ltd......so am taking advantage of that re pension savings. I was aware of the protection to £85k. When you exceed that amount......what happens? Is it £85k per individual account.

I am almost sure the pension is vls or something very similar. The interest is 1.2 % on my savings account at the moment.

bigadaj

LotsToDo wrote: »

The pot will grow by £60 K ish per year. Putting £3,300 per month into a pension in addition to the pot savings.

I have six month emergency fund....thank you Dave Ramsey.

I am unsure how to check projected income on pension....can you advise please?

You say you find stocks and shares a bit scary but you've currently got nearly £40k going into exactly that in your pension.

How was the pension set up, did you use an adviser. With the sums you are talking about it would be worth paying an adviser for set up and maybe ongoing review. Investments in pensions, isas or unwrapped funds are all basically the same under the bonnet.

Notwithstanding that you still need to have an understanding to be aware if the advice is broadly correct and appropriate, so do some reading around these forums, look at monevator website and read a couple of investment books as well, once you have a basic understanding then come back and ask specific questions and they would be much easier to answer.

LotsToDo

bigadaj wrote: »

You say you find stocks and shares a bit scary but you've currently got nearly £40k going into exactly that in your pension.

How was the pension set up, did you use an adviser. With the sums you are talking about it would be worth paying an adviser for set up and maybe ongoing review. Investments in pensions, isas or unwrapped funds are all basically the same under the bonnet.

Notwithstanding that you still need to have an understanding to be aware if the advice is broadly correct and appropriate, so do some reading around these forums, look at monevator website and read a couple of investment books as well, once you have a basic understanding then come back and ask specific questions and they would be much easier to answer.

I am aware of that. Yes....I sought professional advice re pension and it is invested via St James Place Wealth Management.

What I meant was......trying to start investing etc by myself I find intimidating.

I shall check out monevator and would welcome any other recommendations from everyone.

Eco_Miser

LotsToDo wrote: »

House buy will be as soon as I find the right one.....no rush and will make it as right as possible.

The stocks and shares frighten me slightly putting £20 k in as they go so far up and down.

So you don't want to put the money you will be using to buy the house with in investments.
Over 10 years, and no absolute need to cash out at the end, investing at any time in the last 120+ years would work out OK. Over 5 years or less the downs could be more than the ups.

Note I was actually suggesting putting £60k in, £20k in an ISA and £40k unwrapped, if you didn't need it for house, emergency fund, etc.

LotsToDo wrote: »

Is your thoughts s and s and then just a normal bank account.

If you're going to spend the money soon, don't invest it.

However, here's a link to the first article in a series about investing - it applies to pensions, ISAs and unwrapped investments.
https://monevator.com/investing-for-beginners-why-do-we-invest/
Follow links to other pages on that site for lots more good investment suggestions and how-to's.

For savings. use normal banks, but not necessarily normal bank accounts.
Until recently you could get as much as 5% on Regular Savings accounts. the 2% -3% still available is still worth having for your new savings. Open as many as you can reasonably fund (one per institution, except Virgin, which is one per issue; and maybe some special issues from building societies).
Some current accounts pay interest on limited amounts, these can be worth using as savings accounts.
Fixed term and notice accounts may pay better interest than standard savings accounts.
Savings accounts from challenger banks often pay better than the big banks, but your money is still guaranteed by the FSCS (Financial Services Compensation Scheme) up to £85k per institution per customer. Read the detail on the FSCS leaflet you will inevitably be sent from every financial institution you deal with.

LotsToDo wrote: »

Can you have a cash isa and a s and s isa?

Yes, with a maximum of £20k new money per year between them.

LotsToDo wrote: »

I am aware of that. Yes....I sought professional advice re pension and it is invested via St James Place Wealth Management.

Expensive. Search this forum for SJP for opinions on their value.

LotsToDo wrote: »

What I meant was......trying to start investing etc by myself I find intimidating.

I shall check out monevator and would welcome any other recommendations from everyone.

I find trying to run my own business intimidating, but you're managing that OK.

bigadaj

LotsToDo wrote: »

I am aware of that. Yes....I sought professional advice re pension and it is invested via St James Place Wealth Management.

What I meant was......trying to start investing etc by myself I find intimidating.

I shall check out monevator and would welcome any other recommendations from everyone.

Ok, a bit of research would have steered you away from sjp. Do a search for them on this forum, average to poor funds and very expensive, initial charges and exit fees, so a model that has been out of date for maybe a decade.

One of the key things is to split your money into pots you need to access over defined periods, which you've largely done. Cash for less than say five years, equities and funds for at least five and ideally ten years or more. Similarly you can access pensions from 55 or maybe closer to 60 for youngsters and as you're aware pensions can be very tax efficient at the cost of losing access for a relatively long period.

One of the key aspects of investing is to ensure you don't exceed your risk profile, your attitude to risk can be determined by searching online for some risk questionnaires. Simplistically your best long term returns will al,soy always come by investing in shares and funds, but if you are easily scared at short term falls and lock in losses by selling then it won't be the best outcome.

HCIMbtw

St James Place charge relatively expensive fees for management and will be taking a chunk of value out of your pension. If it were my money I would look transferring out of them and setting up a SIPP with a relatively better value independent platform (i believe AJ Bell/Youinvest are reasonable in this regard), but as I have easy access to a company pension I don't have a SIPP. I would probably just put the pension!into a target date pension plan that de risks the investment as you get closer towards the date you target for retirement. (This typically means the pension will shift from growth investments (higher proportion of stocks and shares) to safer investments bonds or such). It should in theory manage itself, but there would be risk associated with it, pretty much as with any pension.!
For the existing £60k i would put the majority of this in a current account with the best interest rate, this will be around 1.2-1.5% ish I think based on threads. Based on the fact you want to put it towards a house you will need access to the money and locking it away in an investment structure will create delays in access.!

A few posters have mentioned VLS, they are referring to Vanguard Lifestrategy Funds run by a company called Vanguard asset management. I recently started investing in one myself for the first time, but they are certainly not the only option available. They essentially are an investment platform that allows you to put money into different funds/structures for growth. The structures of VLS range from high risk 100% equity in Stocks & Shares, to lower risk 20% stocks and shares structures with a mixture of bonds and other things that have more assured, but lower rates of expected return. They also offer other funds that track things like the FTSE index, or developing world Indexes or such.

Now the reason such things have become increasingly popular in recent years is because cash ISA returns have been garbage, they are one of the only ways to invest and beat inflation (so you are not effectively losing value on your savings). And because you can invest up!to £20k per annum tax free in Stocks & Shares ISAs they are tax efficient. You can invest more than this, but tax on the interest gained above the 20k would be payable (just as it is non ISA savings interest above £1k I think?).!

In this regard you might want to look at putting £20k from your existing £60k pot into a S&S ISA to make sure you are benefiting from the tax free allowance this year, then build back up to your £60k over the coming months. But your appetite for risk seems low, so you will want to read more about what you are investing in, why and the potential risks involved.
I wouldn't rule out S&S ISAs for you as you have 10-15 year horizon. However, you may have ways to invest more into a pension.. I am unsure though because don't know any of the nuances of self employment/taking company profits. The argument for employed people closer to retirement putting their money here is the more immediate benefits of avoiding income tax.!

From my perspective Vanguard is very cheap for making monthly direct debits, that is why I use it. If I was investing lump sums, 20k at a time, I would personally do it with a platform called iWeb as on balance they would be the cheaper platform and they have much more funds to choose from.!