Calling all LGPS Pru AVC members - What are you investing in has you near retirement date?

I have been a Pru AVC member for a longtime and only recently (last 5 years) discovered I could choose the investment fund my monthly contribution does into, so I have a mix of medium and high risk I currently invest in. The bulk is invested in the "with profits" which will stay there until retirement date, so I get the bonus.

Are you moving to less risker funds 6, 12 18 months before retirement day?

The best one should have been the "Prudential Deposit Fund" but this closed in 2017, so now the only minimal risk fund "Prudential Cash", but the key is when to move it, the value will definitely shrink because of the charges, but will not plummet.

I was thinking of moving on a sliding scale 12-18 months before retirement date, moving my equity funds, to either Prudential Dynamic Growth II or Prudential Fixed Interest, with new monthly contributions going into the chosen fund at the same time.

Then 4-6 months moving to Prudential Cash. Would/Are any of you thinking moving them to the "With profits fund" instead?

So, I have still a good number of years to invest, but was wondering what other people's strategies are or what recent retirees have done to switching to safer funds as they approach their retirement day?

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Comments

  • Durban
    Durban Posts: 485 Forumite
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    edited 12 February 2021 at 10:51PM
    I still have 12 years to go but would also be very interested in any replies.

    At the moment I have mine in:
     Prudential International Equity (41%)
    Prudential Global Equity (37%)
    Prudential UK Equity Passive (22%)
  • bioboybill
    bioboybill Posts: 3,474 Forumite
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    edited 12 February 2021 at 11:03PM
    Mine is in the with-profits fund like you. I only started in November 2017 and since I am looking to retire in October 2022 I decided a low risk fund was appropriate for me. The with-profits fund is likely to have lower returns, but being based on bonuses from the profits they make rather than being equity-based it’s returns are smoothed out somewhat. If I was retiring in 10 years I would have gone for something with a higher risk but with likelier higher returns.
  • jamjar92
    jamjar92 Posts: 212 Forumite
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    edited 13 February 2021 at 12:29AM
    Mine is 85% With Profits, 5% HSBC, 5% Dynamic Growth 4, 5%  Prudential Global Equity in my old fund. When I started the SSAVC I decided to keep them separate, 20% in each of HSBC, Dynamic Growth 4, Prudential Global Equity, Positive Impact, and With Profits. @Durban I have 8 years to go have you thought of what you going move them to later on?
  • Durban
    Durban Posts: 485 Forumite
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    edited 13 February 2021 at 1:06AM
    I think the funds differ with each LGPS authority. 
     I don't have HSBC or Positive Impact in mine and the funds that are available are limited.
    I was thinking perhaps of switching to Prudential Dynamic Growth 2 about 5 years from retirement.
  • jamjar92
    jamjar92 Posts: 212 Forumite
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    @Durban interesting did not know each LGPS trustees had input on the funds available.
  • In anticipation of my planned retirement date of 31/12/20, I move my entire AVC to cash. Due to Covid, I have decided to stay at work longer but probably no longer than until 31/12/21. Because of the relatively short time scale, I don't feel inclined to take any risks so it is staying in cash. It is a bit annoying seeing them take a 0.55% fee while paying 0% interest but I console myself that I am saving 40% tax.
    mary
  • jamjar92
    jamjar92 Posts: 212 Forumite
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    edited 13 February 2021 at 12:43PM
    @marycanary was any of your avc in withprofits or did you go equities to cash? Cannot decide moving my equities to dynamic growth 2, then cash or equities to cash, or equities to with-profits, given I gave a large pot there already. 
  • It is a bit annoying seeing them take a 0.55% fee while paying 0% interest 
    Yes this is annoying 
  • My scheme does not have Withprofits so I could not consider that one. At the time it didn't offer Dynamic Growth 2 either, although it does now. I was invested in International Equity and Long Term Passive Gilts. Over time I moved to a higher percentage of Gilts. Starting at 100% equity and ending up at 20% equity and 80% gilts. Finally, I moved it all to cash. So I suppose I went Equities - Gilts - Cash.
  • MX5huggy
    MX5huggy Posts: 7,127 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    50% Prudential Positive Impact
    25% Each for 
    Prudential International Equity and Prudential with Profits. But the actual percentages differ a little presumably based performance. Don’t have much choice (I think 7 or 8). Didn’t think too hard about it, more important to start than worry where my first £150 was going. Got 20 plus years to go along as I get more out than the I would of got in net salary I’ll be content. 
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