Just for fun, to have a go or leave to an active passive fund.

ruthshaw2206

First post guys please be nice and apologies for lengthy post. 

I have a very small amount in a SIPP £2400. 

I opened it 4 years ago when I had a panic I had no pension as was self employed. Opened with best invest. Got pregnant with 4th. Career down the tube. And literally did nothing with it. As in it sat in cash. 

With 4 small babies I literally didn’t do anything about it even when they told me they were starting to take off £120 per year admin fee. Thought all companies would be the same and put it down to lesson learn and money gone. 

Kids up a little now and decided to see what there was. 

Transferred to HL a couple of weeks ago and now am lost. 

Given the little in it I realise it never going to make me enough to retire early or anything so as I had put it down to lost money I reckon I can take a few risks. 

As I don’t have a clue (but could learn, have a masters in law so quite bright before all turned to baby mush brain) should I just pop it in a fund like vanguard LS80 (in which case I would be better moving to vanguard cost wise), or any similar cheaper funds? or have a go at building my own portfolio of trusts? 

Anyway where to start? 

Interested in index funds rather than managed (although I realise VLS80 is managed) 

Any ideas welcome. 

I have read a few beginner guides so know I’d need to diversify etc if building my own. I am interested in ethical funds but not completely sold on them.

Thinking of using the SIPP I thought was lost as a learning tool. 

With such a small amount will the higher charges of HL matter against Vanguard?

Also considering then trying to save a little like just 100 pm and wondering would I add to the SIPP or would a S&S ISA be better? 

Never dabbled in S&S before and this would be on top of what I normally save in our emergency fund. 

I’m 37, married, 4 kids, 100k mortgage, no other debt. About 4K in saving plus 3K in kids savings. Hubby works FT (restaurant), I work PT NHS. 

Apart from the SIPP blunder I would normally be good with £ and although we aren’t overly well off we live quite well for our incomes. I overpay mortgage every month and stick to budgets quite well. 

Thanks for any help in advance. 

JoeCrystal

As you are working for the NHS, we can assume that you have joined the NHS pension scheme right?

ruthshaw2206

JoeCrystal said:

As you are working for the NHS, we can assume that you have joined the NHS pension scheme right?

Oh yes I certainly have. 

dunstonh

Interested in index funds rather than managed (although I realise VLS80 is managed) 

It isn't worth building a portfolio of single sector funds with £2400.    If you go with a fund per region and include fixed interest securities you could be looking at around 10 funds.    If your Japanese weighting is 3%, then 3% of £2400 is just £72.   

Multi-asset funds were designed with smaller investors in mind. They do all the work for you.

ruthshaw2206

dunstonh said:

It isn't worth building a portfolio of single sector funds with £2400.    If you go with a fund per region and include fixed interest securities you could be looking at around 10 funds.    If your Japanese weighting is 3%, then 3% of £2400 is just £72.   

Multi-asset funds were designed with smaller investors in mind. They do all the work for you. 

That makes sense. 

When you say multi asset fund is that something like the VLS funds, are there better/cheaper out there with HL as a platform? 

What about something like the L&G international index trust, although it doesn’t seem to have a UK holding? And invests in my pet hate company Nestle. 

Also looked at HSBC global strategy adventurous portfolio. 

Fidelity index world. 

Albermarle

You say you transferred to HL , but then say you still have the SIPP you 'lost' with Bestinvest ? Bit confusing as it is not clear what you have transferred to HL ? Or do you mean you have just opened a new SIPP with HL ?
In any case for such small amounts you do not really need multiple SIPP's . So either stick with Best Invest or HL or move it all to Vanguard. Small differences in charges are not an issue until the funds gets a lot bigger.
As above forget about holding multiple trackers/index funds within the SIPP and either hold one multi asset fund , like Vanguard Life strategy or a similar alternative at the preferred risk level . Add as much as you can and leave it alone.
So one SIPP and one fund in it . Boring but efficient !
Also considering then trying to save a little like just 100 pm and wondering would I add to the SIPP or would a S&S ISA be better? 
The SIPP has a minimum tax advantage of 6.25% over a S&S ISA ( can be more depending on personal circumstances) but you can not access it until your late fifties. That is the trade off in essence.
If you hold the same investments in a pension or an ISA they will perform the same ( might seem obvious but a lot of people get confused about that)
nterested in index funds rather than managed (although I realise VLS80 is managed) 
There is an element of management but it is not a managed fund in the normal sense of the word , where the fund manager is actively picking investments , asset allocation etc ( and you pay a higher cost for this) 

ruthshaw2206

thanks Albermarle, 
Sorry it wasn’t clear, what I meant was my SIPP with bestinvest was sitting there in cash whittling away to nothing with their admin fees of £120 per year since 2018 so I transferred it to HL after looking for best SIPP’s on the site. 

After transferring I researched a bit and realised the VLS funds might be best suited but wasn’t sure if there were cheaper similar options with HL as I like the HL app etc and found them very helpful when I was moving. Maybe an ethical one? 

Just reckon as it was money I had resigned myself to losing but now haven’t I could take a risk with it. Let’s face it, that wee SIPP isn’t going to allow for early retirement that’s for sure any way so what the harm.  🤦🏻‍♀️. 

Albermarle

After transferring I researched a bit and realised the VLS funds might be best suited but wasn’t sure if there were cheaper similar options with HL as I like the HL app etc and found them very helpful when I was moving. Maybe an ethical one? 

HL as an investment platform is fine , although an app is a double edged sword as it encourages you to tinker with the investments .

The tip with HL is to avoid any own brand HL multi manager funds they promote, as they are very expensive .

There are alternatives to VLS funds but cost wise at 0.22% they are pretty cheap anyway . You can look at HSBC global strategy ( less UK orientated than VLS) . Ethical alternatives will tend to be a bit more expensive and the more severe the ethical criteria, then more expensive still .

ruthshaw2206

Albermarle

The tip with HL is to avoid any own brand HL multi manager funds they promote, as they are very expensive 

Do you mean the ones on their wealth shortlist,  I have taken that with a pinch of salt. I did consider putting a bit of it, maybe the few hundred into the l&g future world ESG developed index just to ease my ethical quest. 

Can’t do much harm I guess and was one of the cheaper ethical ones. 

garmeg

ruthshaw2206 said:

Albermarle

The tip with HL is to avoid any own brand HL multi manager funds they promote, as they are very expensive 

Do you mean the ones on their wealth shortlist,  I have taken that with a pinch of salt. I did consider putting a bit of it, maybe the few hundred into the l&g future world ESG developed index just to ease my ethical quest. 

Can’t do much harm I guess and was one of the cheaper ethical ones. 

There is some decent stuff on the Wealth shortlist like Rathbone Global Opportunities - comes with a nice discount too.

justcheckin

If you feel that your NHS and state pensions will be adequate for your retirement income (and you won't breach the LTA), then one thing you could do is to use (some of) the SIPP as a 25% uplift savings plan for the children's uni fees etc? From your age, and the age of your youngest, your ability to draw 25% tax free at age 57, and it having had 25% added to it by HMRC at first input, would be quite hard to beat elsewhere.

Just a thought. It's what we are doing anyway. Also have 4 kids, littlest age 6. Basically we are using my husbands carry forward to stuff as much into SIPPs as possible, to give some to the children for uni etc.