A question re SIPP drawdown and tax.

rothers

They are with either the Prudential or Standard life aren’t they? Do you save national Insurance contributions as well as tax with these as it comes out of your salary?
I was thinking of opening a Vanguard SIPP and putting it into the lifestrategy 60% and leaving it for the ten years until she retires. I was thinking of putting larger amounts in initially and reducing the amount gradually to ensure that the bulk of it is in the market for the longest possible time. 

Are there similar funds in either of the avc providers?

Albermarle

Do you save national Insurance contributions as well as tax with these as it comes out of your salary?

This depends on how the contributions are taken out of the salary ( there are three different ways it can be done and different employers use different methods) . I do not know how AVC contributions are handled by the NHS unfortunately.

There will most likely be similar types of funds to VLS 60 . It is just a multi asset fund with 60% equity content , and there are many similar alternatives. The charges in the AVC may be different to what you would find 'outside' .

rothers

Albermarle said:

Do you save national Insurance contributions as well as tax with these as it comes out of your salary?

This depends on how the contributions are taken out of the salary ( there are three different ways it can be done and different employers use different methods) . I do not know how AVC contributions are handled by the NHS unfortunately.

There will most likely be similar types of funds to VLS 60 . It is just a multi asset fund with 60% equity content , and there are many similar alternatives. The charges in the AVC may be different to what you would find 'outside' .

Cheers 👍👍

rothers

Further to this we are going to open a sipp with vanguard and invest in the life strategy range. The only question is which level of equity/bonds? My wife will retire in ten years, if not more. We are wondering whether to go 80/20 or 60/40, any opinions?

ivormonee

If it was me I'd go for the 60 option but my circumstances, not just age, might be different to yours, as might my "appetite" for risk. With ten years to go the 60 option would not seem unreasonable, but let's see what others say too.

pip895

I don't like bonds atm so I would go 80%...

rothers

It was the outlook for bonds that was leaning me towards the 80/20 split. We can always reduce the equity level in years to come. 

Still interested in other opinions though. 

Croeso69

pip895 said:

I don't like bonds atm so I would go 80%...

In that case why not VLS100? 

Pair it with 20% cash if you dont want a full 100% equity allocation.

rothers

Croeso69 said:

pip895 said:

I don't like bonds atm so I would go 80%...

In that case why not VLS100? 

Pair it with 20% cash if you dont want a full 100% equity allocation.

Are bonds going to generate any growth going forward though?

Thrugelmir

rothers said:

Croeso69 said:

pip895 said:

I don't like bonds atm so I would go 80%...

In that case why not VLS100? 

Pair it with 20% cash if you dont want a full 100% equity allocation.

Are bonds going to generate any growth going forward though?

Equities might lose you money over a shorter time frame. Volatility in markets can cause wild swings in valuation. Not helpful if you need to drawdown funds on a frequent basis.