S&S LISA - fund/tracker options

noclaf

I have £15k in a cash LISA, I may lose my 'first buyer' status and if that happens my preference would be to transfer the £15k to a S&S LISA and invest it into a fund or tracker and think of as a supplement to my pension for the long-term. I already have a Vanguard S&S ISA and contribute £150 monthly as a 'fire and forget' setup. I try not to mess about with that but did attempt to 'time' the market back in March/April and trade the initial 'bounce' after the market had taken a nosedive.
What would be a sensible approach for a fund or tracker options to complement the VLS 100? The VLS is fairly well diversified albeit 100% equities exposure and fairly significant UK weighting. I want to keep things simple and cost effective...could use another Vanguard fund but I'd also be interested in other options if anyone else has a similar setup.
For context I am late 30's and have around a years worth of take-home salary in cash.
Thanks

Albermarle

If you are happy with the higher risk level of 100% equities , then maybe you could look at a global index tracker ( fund or ETF) which will be without the UK weighting of VLS100, so a better balance if you have both .
Do you have a pension fund as well? if so you should include the investments there as well when looking at your total portfolio.

Thrugelmir

VLS 100 has a high exposure to the mega cap US stocks.  Nor dismiss UK companies out of hand. Many generate significant earnings from overseas. Brass plate location is no longer an issue in this open world. 

ColdIron

Vanguard Investor don't offer a LISA so you are probably looking at HL or AJ Bell if you want a wide choice of trackers. Maybe something in the HSBC Global Strategy range for a multi asset fund or a global index ETF (maybe Vanguard) to take advantage of the price caps. There is plenty of choice

eskbanker

Thrugelmir said:

VLS 100 has a high exposure to the mega cap US stocks.

But by virtue of its UK bias this must be less pronounced than the unadjusted cap-weighted global equity trackers it's largely competing with?

Alexland

For optimised platform fees on a £15k+ S&S LISA you would probably be looking at EQi for funds (0.20% so £30 and they cap at £40 pa) or AJ Bell YouInvest for exchange traded assets (for which they cap at £30 pa but £1.50 for a scheduled trade). For 100% passive equities on EQi then I would be tempted by the HSBC FTSE All World fund at 0.13% and on AJ Bell we invest in the Lyxor World LCWL accumulation ETF at 0.12%

HL would be expensive at 0.45% on funds (£67.50 pa) or capped £45 pa for exchange traded assets but they have limitations on how you can use their regular exchange trading (only being used for new contributions not the cash balance) which means it would be an £11.95 trade to invest the bonus. That was the reason we moved our £20k +growth LISAs from HL to AJ Bell.

p.s. if you are late 30s and thinking of moving to a S&S provider... do it before becoming 40 as the forum is not aware of any S&S LISA providers currently accepting transfer requests from people with existing LISAs who have since turned 40. This means you need to trust the provider to keep their offer attractive as you might not be able to leave them for 20+ years.

noclaf

Thanks for the insight so far, all useful.
I am aware that we could be in for a bumpy ride with the combined headwinds from Brexit and Covid but happy to continue taking some risk with the 100% equities exposure.
For £15k does it make sense to use a single tracker to keep things simple and costs down..any suggestions of where to start and how would so avoid overlap with the VLS 100?I am aware Fidelity, BlackRock and HSBC all have their own 'all in 1' DIY trackers and funds. It's likely (but not decided) that I may use HL for the S&S LISA platform. I've used HL before and was fairly happy with them.
Overlap might not be a bad thing necessarily but just a thought.
I have two pensions; current employer is just over £50k and £25k in a previous employer pension scheme. For the current employer pension I contribute 8% gross monthly salary and employer matches with 12% contribution(however for one year their contribution is reduced to 4% due to Covid).

csgohan4

you could also use the EQI lisa to put your satellite funds in if you already have a VG platform for your main trackers. 

Alexland

noclaf said:

For £15k does it make sense to use a single tracker to keep things simple and costs down..any suggestions of where to start and how would so avoid overlap with the VLS 100?I am aware Fidelity, BlackRock and HSBC all have their own 'all in 1' DIY trackers and funds. It's likely (but not decided) that I may use HL for the S&S LISA platform. I've used HL before and was fairly happy with them.

I think you might have been writing this when I added my above post which gives some ideas on investment and platform combinations.

noclaf said:

I have two pensions; current employer is just over £50k and £25k in a previous employer pension scheme. For the current employer pension I contribute 8% gross monthly salary and employer matches with 12% contribution(however for one year their contribution is reduced to 4% due to Covid).

If you are missing out on any employer matched contributions (other than due to covid) or higher rate tax relief then it is likely to be preferable to make additional pension contributions in priority over LISA contributions. If you benefit from salary sacrifice to save the NI on your pension contributions then the benefit at basic rate works out about the same as using a LISA.

Albermarle

I have two pensions; current employer is just over £50k and £25k in a previous employer pension scheme

Are you aware of how they are invested ? Are they also 100% equities ? How £75K is invested is more important than the £15K LISA.

noclaf

Albermarle said:

I have two pensions; current employer is just over £50k and £25k in a previous employer pension scheme

Are you aware of how they are invested ? Are they also 100% equities ? How £75K is invested is more important than the £15K LISA.

I will be honest and it's lazy of me... but haven't paid much attention to the funds invested in so far. I believe they are the default funds for each defined contribution scheme and both invested in Standard Life funds of some variant ( I can check the exact fund if needed). I tend to track the amounts every now and then but that's as far as my involvement has been so far.