VLS 100 - Stick or twist

thegentleway

I don’t know how much you have in VLS100 but I was in a similar position (about £10k in VLS80) and just sold in the end (I wanted to invest in ethical funds moving forwards).
ISA allowance is £20kpa.
Historically lump sum investment beats drip feed. Drip feed is a good psychological trick for people who are worried about investing a lump sum since drip feed is a lot better than not investing. 

Alexland

I don't think you are obviously doing wrong either way. The purist approach would be to use the All Cap but it's now heavy on US growth stocks. VLS100 is less pure but arguably more balanced with better representation of non-US value stocks. Over the short term as a UK based investor the home bias in VLS should help balance out the UK brexit 'plague island' volatility and with All Cap your investment would be more exposed to currency movements.

If/when the ISA gets big enough to move to a fixed price platform such as iWeb then I wouldn't go with HMWO (Developed World only) when they offer the cheaper HSBC FTSE All World fund which includes Emerging Markets.

noclaf

I think will stick with VLS 100 for now and top it up early next year to make full use of my S&S allowance.
Alexland - thanks and good point re the HSBC All world fund you mentioned, I recall you suggested the same fund on a few other threads given the good VFM it represents.
Thanks all for your input!

On a unrelated note, am I allowed to hold two S&S ISA's(different platform/providers) on the basis I only contribute to one of them in a given tax year? For example let's say I add to my Vanguard S&S ISA before the end of 20/21 tax year then in 21/22 tax year can I open a S&S ISA with a different platform and contribute to that?(assume no contributions to the Vanguard S&SISA in 21/22).

Alistair31

noclaf said:

On a unrelated note, am I allowed to hold two S&S ISA's(different platform/providers) on the basis I only contribute to one of them in a given tax year? For example let's say I add to my Vanguard S&S ISA before the end of 20/21 tax year then in 21/22 tax year can I open a S&S ISA with a different platform and contribute to that?(assume no contributions to the Vanguard S&SISA in 21/22).

Yes you can.

matty6962

hi everyone . first time investor. i have just moved to a flexi drawdown with vanguard as i think the fees are fair. i am 60 now but don't mind a small punt. i have 100k. which i was thinking of putting 40k into ls40 and 40 k into retirement fund they have. the other 10 i was thinking of s&p 5oo in the us but not sure what to do with the other 10 any advice would be appreciated tx

Thrugelmir

Seems illogical to derisk 80% of the portfolio then take a total punt with the remaining 20%. Which unbalances the portfolio weightings. 

noclaf

Op here - probably a straightforward question (hopefully) but thought I'd check as it's confusing me:
If I added £4000 to an S&S ISA in 2019/20 and then in the next tax year 2020/21 remove the £4000 + £1000 from 20/21 tax year (£5k total) then what total tax allowance have I 'lost/forfeited' from 20/21 from the £20k limit?

grumiofoundation

noclaf said:

Op here - probably a straightforward question (hopefully) but thought I'd check as it's confusing me:
If I added £4000 to an S&S ISA in 2019/20 and then in the next tax year 2020/21 remove the £4000 + £1000 from 20/21 tax year (£5k total) then what total tax allowance have I 'lost/forfeited' from 20/21 from the £20k limit?

Removing money has no impact on your allowance - allowance is based on contributions (of new money) - so assuming you have only contributed £1000 in 2020/2021 tax year (across all ISAs) your allowance would still be 19k (edited for clarification). 

Only caveat to this would be if the S&S ISA is flexible. In this case you would be able to add the 5k back in within the 20/21 tax year without this counting towards the 2020/21 allowance (see link below from vanguard).

https://www.vanguardinvestor.co.uk/need-help/answer/is-the-vanguard-isa-a-flexible-isa

noclaf

grumiofoundation said:

noclaf said:

Op here - probably a straightforward question (hopefully) but thought I'd check as it's confusing me:
If I added £4000 to an S&S ISA in 2019/20 and then in the next tax year 2020/21 remove the £4000 + £1000 from 20/21 tax year (£5k total) then what total tax allowance have I 'lost/forfeited' from 20/21 from the £20k limit?

Removing money has no impact on your allowance - allowance is based on contributions (of new money) - so assuming you have only contributed £1000 in 2020/2021 tax year (across all ISAs) your allowance would still be 19k (edited for clarification). 

Only caveat to this would be if the S&S ISA is flexible. In this case you would be able to add the 5k back in within the 20/21 tax year without this counting towards the 2020/21 allowance (see link below from vanguard).

https://www.vanguardinvestor.co.uk/need-help/answer/is-the-vanguard-isa-a-flexible-isa

Thanks this is exactly what I was looking for.

noclaf

Hi All,
Op here again. So currently my Vanguard S&S ISA value is around 5% Vs my cash. So fairly conservative amount in the VLS 100 and were there to be a market correction I wouldnt even blink or lose sleep over it.

I would like to make more use of my S&S allowance this year as fully aware of the longer term implications of holding a lot of cash in the current low interest environment but feel the markets are looking a bit peaky and expensive (US for example) however I don't have a crystal ball and there is always the 'FOMO on the gravy train' effect as the markets keep going upwards but I'm stuck as to which way to go..do I dial down the risk and switch to a VLS 60/80; do I keep the VLS 100 and add a another fund to offset the high equities exposure or do I completely switch the VLS 100 to say the global all cap fund and add a bond fund or etf alongside it?
The last point contradicts my earlier decision to stick with VLS 100 but as my total S&S ISA value is fairly low surely now is the time to switch before committing more funds to my longer term investing approach?
Another way to ask this question is how do others strike a balance between holding enough cash for any emergencies or financial shocks such a loss of employment and making use of investing to offset the erosion in the value of cash? I seem to be struggling to find that delicate balance.