Finally Dumping my FA and DFM and moving my SIPP to II

davethebb

Hi Everyone, 
I would just like your thoughts and comments on my plans just in case I am totally off course. I am 54 and plan to retire in two years time.
Slowly but surely I am almost there in moving all my investments away from my FA and DFM. I moved General Investments and ISA last year and now I am in the process of moving my SIPP so they they will all eventually be under Interactive Investor. After following the forum and reading up a little my general plan to maximise profits vs tax is to use my GIA as a low volatility set of investments which would if need be last me 2 to 3 years followed by SIPP on a medium volatility and then my ISA would be long term, higher volatility. The overall volatility of the total portfolio would by around the same level as the SIPP. 
Rather than build portfolios myself (which would require far more research) I have decided to use a blend of general Mixed and Flexible investment funds (researched and modelled using Trustnet) to achieve the levels of risk and volatility etc. and then add specific funds to spice things up but these are mainly in the ISA e.g. higher volatility. This way I let the fund manager decide on the type of asset (growth, value, mid, large company, country and sector) I just focus on the risk and volatility that suits me. In general I do not use any fund more than once and the overall allocation for any particular fund would b 8% overall. I also review the underlying companies which are used as there is sometimes a lot of overlap. For example my GIA  (Risk level 47, Volatility 9.26, ALPHA 13.28, BETA 0.65) is constructed out of;

Baillie Gifford Managed B Acc

Liontrust Balanced C Acc

Liontrust Sustainable Future Cautious Managed 2 Inc

Royal London Sustainable Managed Growth Trust C Acc

When I come to retirement I will take £16.5k out of my SIPP every year and then top up with the money from the GIA and ISA until they eventually run out and then I will use the SIPP.
Does this seem a sensible plan or am I completely of the mark and bonkers?

Cus

Did you discuss this plan with your IFA?

dunstonh

It is a strange combination of funds.  Not necessarily unsuitable but just a strange combo.   Also the funds are expensive.  So, you are replacing the expense of the DFM with an expense of fund manager who is effectively doing a similar job.

Audaxer

davethebb said:

When I come to retirement I will take £16.5k out of my SIPP every year and then top up with the money from the GIA and ISA until they eventually run out and then I will use the SIPP.

That seems like a good plan, but I'm a bit puzzled as you also said that your ISA would include your longer term, high volatility investments, so just wondering why you would use that to top up your annual income?

NottinghamKnight

dunstonh said:

It is a strange combination of funds.  Not necessarily unsuitable but just a strange combo.   Also the funds are expensive.  So, you are replacing the expense of the DFM with an expense of fund manager who is effectively doing a similar job.

It does look expensive but compared with removing a FA and DFM who may themselves be using expensive funds there's still going to be considerable cost savings, at least 1% and maybe quite a bit more.

davethebb

Thanks you for your responses.
Cus, No this is something that I have picked on my journey (from the web, friends etc.).
Dunstonh, I appreciate that they are expensive but the expense/costs are all taken into account within the fund performance - eg you don't actually see the cost. This is actually one of the reasons why I gave up on the DFM/IFA - it turned out that when they gave me the annual review and detailed my investment performance that some of the costs where not actually taken into account and therefore the actual return on my money was a lot less than they where reporting - very deceptive but it seems that the company concerned is not the only one that does it this way.
Audaxer, In reality I will probably start by skimming some of the risker funds from the ISA (reducing risk) if I need to but I will use the GIA money first.