burnt out nurse and investing newbie

stellios84

I have recently come into some inheritance and also amounted some savings so have a pot of around 200k to invest. I knew nothing at all about investing 2 weeks ago so bear with me this is all very new! I am very mindful of making some potentially duff decisions so am very keen for any advice given. So far I have invested 20k in a medium risk Halifav stocks and shares fuly managed isa and 20k in the higher risk. I have also just invested 80k in Nutmeg medium risk fully managed smart Alpla. 
I am now considering Vaguard life strategy in a mix of risks but aimed at long term gain (min 5 years hopefully longer). I am tempted by 60k in 60% equities and 20k 100% equities. I am also considering Fundsmith as an option but keep reading stuff about the risks of the fund becoming too big. I currently have 50k in premium bonds (last 3 months) but will likely keep this as my accessible emergency fund.
I am 50 work part time no mortgage  and live pretty simply. I am considering working less at 55  or even stopping with the aim of drawing an income. I have an  NHS pension but it is pretty low as I have always been part time. 
I would really appreciate any guidance at all and am aware that my new found  'little knowledge' could be potentially dangerous. 

dunstonh

 I am very mindful of making some potentially duff decisions so am very keen for any advice given. 

Nothing you see on this site is advice (or any other internet site).  It is discussion and opinion.   Don't assume everything you read is right or suitable.  Certain posters seem to have certain preferences which could be labelled as crazy by some people.    

So far I have invested 20k in a medium risk Halifav stocks and shares fuly managed isa and 20k in the higher risk.

Not a great option.   Banks rarely provide quality or cost effective options.    Indeed, it is often said that the first you thing you do when filtering investments is to remove the banks funds/products.    And mixing and matching on risk like that, whilst a potentially viable option, is a bit on the messy side.

I have also just invested 80k in Nutmeg medium risk fully managed smart Alpla. 

Some may like robo-options but they are not exactly cost effective.   You don't get the low cost of basic options and you are paying near full advice level fees but not getting the advice.

I am now considering Vaguard life strategy in a mix of risks but aimed at long term gain (min 5 years hopefully longer). I am tempted by 60k in 60% equities and 20k 100% equities

VLS60 isn't bad.  It's arguably no longer the best solution of the options similar to that but it's up at the right end.  VLS100 is the weakest of the VLS options but again its not unreasonable to consider.

I would really appreciate any guidance at all and am aware that my new found  'little knowledge' could be potentially dangerous. 

Its a bit late to be asking for "advice" when have already made decisions with a large amount of it.     At present, you seem to be throwing it about all over the place with no structure or process.    It's all a bit messy.

You have mentioned ISA. So, that is one tax wrapper being used.  What about the pension tax wrapper?  You haven't mentioned that.  

How do you plan to use bed & ISA going forward and using your annual CGT allowance?

What are your objectives for this money?   You are throwing it into solutions but no reference has been made to what objectives you are looking to achieve.

Its a very common new investor error to invest above their risk profile.   You have dived in right at the deep end with a large chunk of the money.   If you can handle the losses that will come with that during negative periods, then that is fine.   However, most UK consumers cannot.  So, are you sure you have looked at the risk side correctly?

LHW99

Could you pay extra into your NHS pension - either by increased contributions or AVC? (don't know which would be best).

Have you checked your state pension, and read down below the "maximum you could get" to find out how many years short you may be?

https://www.gov.uk/check-state-pension

stellios84

Thank you so much for your replies so far. I absolutely agree that I have perhaps jumped in at the deep end a little hence my post. 

I am a little surprised by the Halifax ISA not being a good option as I haven't come across anything negative previously about them and read that they were competitively priced and quite well reviewed. I wasn't aware that banks should be avoided. 

In terms of my goals I guess retirement at 55 and drawing down an income would be an ideal but I am beginning  to realise this may not be an option. I imagined seeking the advice of a FA at the end of this five year period but perhaps I should reconsider getting advice now? 

AlanP_2

If it was me I would suspend any further investments for now and think about what I want the money to do for me and develop an approach / plan that takesm me towards that goal.

(You haven't mentioned a spouse / partner, but if there is one then a plan that both agree on and are working towards is the way to go).

Assuming you arr single for now then:


Any dependents or any other loans?

Any other savings / investments? 

How much do you need / want in retirement (Your Number)? Work it out in today's money based on what you spend now less any work costs e.g. commuting.

How much will your NHS pension contribute to your number and at what date?

Check your State Pension forecast reading beyond the 1st page headline figure to see how many (if any) years you still need to pay NI for and what the maximum you can get is.

Will the combined NHS pension + State Pension give you enough from SP age to at least cover the "needs" so that the "wants" can be paid for from investments & savings?

If you want to retire at 55 you will have to fund your number from the investments for a few years whilst defering NHS pension and waiting for SP. Alternatively you could take NHS pension early but it would be at a reduced rate.


You need to collect the information on NHS pension, SP and your wants/ needs numbers and then develop a plan.

For example you could add to your NHS pension, you could pay some of your £200k in to a personal pension instead of into the ISA wrapper and so on.

You have done what many of us did when we first started out on this road, instead of Aiming and Firing at the target we Fired and then wondered what the target was. The former delivers a higher success rate than the latter. 

eskbanker

stellios84 said:

I am a little surprised by the Halifax ISA not being a good option as I haven't come across anything negative previously about them and read that they were competitively priced and quite well reviewed. I wasn't aware that banks should be avoided.

dunstonh's comment that "Banks rarely provide quality or cost effective options" is perhaps best viewed as a rule of thumb rather than an absolute statement - Halifax's share dealing platform is relatively cost-effective, especially for those choosing to use its regular investing option but, in terms of the investments, what specifically are the fully managed products that you've bought into?

Eyeful

I am surprised that having £200k and no knowledge of investing you did not see an Independent Financial Advisor (IFA), before you decided on the best way of using the money. Why was this?

When people with little knowledge start to invest, it is normal to suggest using a simple Global Multi Asset Fund with a share/bond split you are comfortable with, it provides a ready made portfolio. They should not invest above their risk tolerance, so they can sleep at night and stay invested when markets fall. This may be the only fund you need.

I do not know what you have read or watched so, you may already know the following points.
1. Investing is putting your money at risk and will not be covered by the FSCS scheme.
2. You should have an emergency fund.
3. Use SIPP's & Stocks & Share ISA's where possibly.
4. Invest for 10 years or longer for the best odds of winning the investment game.
5. A simple portfolio takes less looking after and can produce the same results as a complex portfolio. 

The following may be of interest to you.

https://www.kroijer.com/
https://monevator.com/investing-for-beginners-why-do-we-invest/
https://monevator.com/passive-fund-of-funds-the-rivals/

stellios84

eskbanker said:

stellios84 said:

I am a little surprised by the Halifax ISA not being a good option as I haven't come across anything negative previously about them and read that they were competitively priced and quite well reviewed. I wasn't aware that banks should be avoided.

dunstonh's comment that "Banks rarely provide quality or cost effective options" is perhaps best viewed as a rule of thumb rather than an absolute statement - Halifax's share dealing platform is relatively cost-effective, especially for those choosing to use its regular investing option but, in terms of the investments, what specifically are the fully managed products that you've bought into?

it's their managed investment account Rick level 4 and 6. 

Eyeful

Had a quick look at the Halifax Rick level 4,   Is active management    On going charge=0.99%
From their website it shows Asset Allocation:  stock=44.77%, bonds= 60.8%, Cash= 12.34%. other=3.51%,unclas=3.2%  Total= 124.62%   
  Anyone with suggestions why the asset allocation does not total 100% ?

 While Vanguard Life Strategy Fund (passive investment) Risk level 4      Ongoing charge 0.22%
Asset Allocation: Stock=40%, Bonds=60%, Total=100%

You are paying a lot higher charge for their active management.

grumiofoundation

Eyeful said:

Had a quick look at the Halifax Rick level 4,   Is active management    On going charge=0.99%
From their website it shows Asset Allocation:  stock=44.77%, bonds= 60.8%, Cash= 12.34%. other=3.51%,unclas=3.2% total of 124.62%!  Total= 124.62%     Anyone with suggestions why these asset allocation do not total 100% ?

I am not sure where you are looking but I see : https://www.halifax.co.uk/investing/start-investing/ready-made-investments.html



https://www.halifax.co.uk/investing/start-investing/ready-made-investments.html

 While Vanguard Life Strategy Fund (passive investment) Risk level 4      Ongoing charge 0.22%
Asset Allocation: Stock=40%, Bonds=60%, Total=100%

You are paying a lot higher charge for their active management.

Whatever your opinion of active management it is rather simplistic to just compare based on the % of shares/bonds.

Eyeful

Even the well re-guarded  actively managed Baillie Gifford Managed B, multi asset fund.only has an  on going charge = 0.42%