How best to invest a SIPP

NewtoSIPPs

Good afternoon all.  Long time lurker here, and decided to sign up today so that I can hopefully achieve my goal of retiring at 57 (I know the age increases to 57 in 2028).  That is 13 years away. 

I have a decent sized SIPP after combining 3 smaller pensions, including one deferred DB scheme and 2 DC funds.  I am still paying into a current DC scheme with my employer, and with my additional voluntary contributions and annual salary sacrifice that is growing (before any growth) by about £12,000 a year.

Id like to select funds myself, As I have some investing experience in shares but am new to pension funds.  Where should I look for pension fund information, and how best should I split my total fund?  In an ideal world, I’d like growth of between 5-7% pa, but would obviously not turn my nose up at more than that 

MallyGirl

If it is a SIPP you can choose any (subject to it being available on your platform) fund or share or ETF to invest in - it doesn't have to be a 'pension fund'.

NewtoSIPPs

Thank you MallyGirl - Apologies, that’s what I meant (new to the terminology).  Where can I begin to see what funds are recommended, and more importantly, where should I be looking for advice etc?  (I know not on a public forum from strangers) 

MallyGirl

I would try reading some blogs (monevator springs to mind but there are loads) or books.
John Edwards books are a good basic start.
For many people the choice of a multi asset fund at your risk level is quite good enough - Vanguard Lifestrategy, HSBC Global Strategy, Blackrock and the like. Search on here for plenty of threads about them. There will be no advice on here as that is a regulated activity but there is plenty of information to help you educate yourself.
If that is not for you then, depending on what you define as a decent sized SIPP, maybe find a local IFA to manage it for you.

Marcon

NewtoSIPPs said:

Id like to select funds myself, As I have some investing experience in shares but am new to pension funds.  Where should I look for pension fund information, and how best should I split my total fund?  In an ideal world, I’d like growth of between 5-7% pa, but would obviously not turn my nose up at more than that 

You'd need to take a fair degree of risk to try and get that sort of return, so how do you feel about losses of 5-7%?

Albermarle

Obvious question is what is your SIPP and workplace pension currently invested in ?

NewtoSIPPs

MallyGirl said:

I would try reading some blogs (monevator springs to mind but there are loads) or books.
John Edwards books are a good basic start.
For many people the choice of a multi asset fund at your risk level is quite good enough - Vanguard Lifestrategy, HSBC Global Strategy, Blackrock and the like. Search on here for plenty of threads about them. There will be no advice on here as that is a regulated activity but there is plenty of information to help you educate yourself.
If that is not for you then, depending on what you define as a decent sized SIPP, maybe find a local IFA to manage it for you.

Thanks again MallyGirl - just had a look at your first suggestion, Vanguard Lifestrategy and there were several listed, all with different Equity amounts, from 20% right up to 100%. What is the difference? (Other than a higher equity %) 

NewtoSIPPs

Marcon said:

NewtoSIPPs said:

Id like to select funds myself, As I have some investing experience in shares but am new to pension funds.  Where should I look for pension fund information, and how best should I split my total fund?  In an ideal world, I’d like growth of between 5-7% pa, but would obviously not turn my nose up at more than that 

You'd need to take a fair degree of risk to try and get that sort of return, so how do you feel about losses of 5-7%?

I’d be happy to accept a 5-7% loss if 4 or 5 years it was 5-7% gains year on year.  I looked at several funds and from 2005, there were only 2 years with losses, 2008 (recession) and a smaller one in 2018.  Even last year, all the funds I looked at grew from the previous year 

bostonerimus

NewtoSIPPs said:

MallyGirl said:

I would try reading some blogs (monevator springs to mind but there are loads) or books.
John Edwards books are a good basic start.
For many people the choice of a multi asset fund at your risk level is quite good enough - Vanguard Lifestrategy, HSBC Global Strategy, Blackrock and the like. Search on here for plenty of threads about them. There will be no advice on here as that is a regulated activity but there is plenty of information to help you educate yourself.
If that is not for you then, depending on what you define as a decent sized SIPP, maybe find a local IFA to manage it for you.

Thanks again MallyGirl - just had a look at your first suggestion, Vanguard Lifestrategy and there were several listed, all with different Equity amounts, from 20% right up to 100%. What is the difference? (Other than a higher equity %) 

You pretty much nailed it. This is not rocket science. Take a look at the protfolio of funds inside the various VLS funds and you'll see they hold different allocations. So choose the one that best suits your appetite/need for risk vs return...job done.

NewtoSIPPs

Albermarle said:

Obvious question is what is your SIPP and workplace pension currently invested in ?

My SIPP is currently held as cash as it’s just been consolidated last week.  

My workplace DC pension is split between 3 funds, ‘Diversified Growth’, ‘UK Equity Index Fund’ and ‘Overseas Equity Index Fund’ 

MallyGirl

NewtoSIPPs said:

MallyGirl said:

I would try reading some blogs (monevator springs to mind but there are loads) or books.
John Edwards books are a good basic start.
For many people the choice of a multi asset fund at your risk level is quite good enough - Vanguard Lifestrategy, HSBC Global Strategy, Blackrock and the like. Search on here for plenty of threads about them. There will be no advice on here as that is a regulated activity but there is plenty of information to help you educate yourself.
If that is not for you then, depending on what you define as a decent sized SIPP, maybe find a local IFA to manage it for you.

Thanks again MallyGirl - just had a look at your first suggestion, Vanguard Lifestrategy and there were several listed, all with different Equity amounts, from 20% right up to 100%. What is the difference? (Other than a higher equity %) 

The more equity, the higher the risk - at a very simple level - but also the higher potential for gain (or loss)