Are these funds worth keeping?

Langtang

We are now getting to the point in my in-law’s estates’ winding up process where we have to decide what to do with the existing investments. 

I wondered if anyone here could tell me whether these investments were worth keeping, or if we should be looking elsewhere for something better/different?

I note in the attached documentation for the Janus Henderson ISA that they say:

“Janus Henderson do not currently offer an APS ISA and therefore we cannot accept APS allowances from another JH account or external providers”

Does this mean that if we keep this ISA open, we cannot add any more funds to it? If we were to keep it, we had planned to transfer in an existing cash ISA from elsewhere. Perhaps this means it isn’t possible to do this?



Janus Henderson fixed Interest Monthly Income Fund inc (£4350 invested within ISA)

Aberdeen Standard ASI high yield bond fund retail inc (£13700 invested within ISA)

Thanks.

dunstonh

Does this mean that if we keep this ISA open, we cannot add any more funds to it? If we were to keep it, we had planned to transfer in an existing cash ISA from elsewhere. Perhaps this means it isn’t possible to do this?

On death, the ISA ceases to exist and it becomes unwrapped.    So, on settlement of the estate, they can be transferred in situ to the beneficiary or sold to cash.

Both funds are the types that are designed to be held as a wider portfolio of funds and not in isolation.    If they are the only two funds then its time to start again.   And it sounds like these are with the fund house directly which is usually the most expensive way to hold funds.    The retail funds, for example, stopped being used after 2013 unless bought direct and are usually twice the cost of the clean share classes offered after 2013.

MaxiRobriguez

Both are bond funds, so on the lower end of the risk scale, but the Aberdeen fund is targeted at riskier bonds so that edges up the risk profile slightly. Neither funds will contain any exposure to equity, commodities or alternative investments.

It's a concentrated, low/medium risk portfolio. Agree with dunstonh - time to start again.

Langtang

dunstonh said:

Does this mean that if we keep this ISA open, we cannot add any more funds to it? If we were to keep it, we had planned to transfer in an existing cash ISA from elsewhere. Perhaps this means it isn’t possible to do this?

On death, the ISA ceases to exist and it becomes unwrapped.    So, on settlement of the estate, they can be transferred in situ to the beneficiary or sold to cash.

Thanks for your reply, this has now also been confirmed by me reading that enclosed letter, properly...

dunstonh said:

Both funds are the types that are designed to be held as a wider portfolio of funds and not in isolation.    If they are the only two funds then its time to start again.

JH give a monthly return of c£15.00 so had assumed if we added more to that fund it would provide a nice top up to our (planned) retirement.

At present, they are the only 2 investments. Once the estates are settled, we plan on investing a substantial part of them in another way, shape or form so they would eventually be part of a larger portfolio. 

dunstonh said:

 And it sounds like these are with the fund house directly which is usually the most expensive way to hold funds.    The retail funds, for example, stopped being used after 2013 unless bought direct and are usually twice the cost of the clean share classes offered after 2013.

They are indeed lodged with the respective fund houses and have been so since, I would assume, 1999 when FIL retired. They seem small in comparison to today’s sums, but assume they would have been large by ‘99 standards. MIL had some, too, but these were liquidated to provide care home fees for her. 

Thanks, once again, for your insight. You have made the decision much easier. Regards. 

Langtang

MaxiRobriguez said:

Both are bond funds, so on the lower end of the risk scale, but the Aberdeen fund is targeted at riskier bonds so that edges up the risk profile slightly. Neither funds will contain any exposure to equity, commodities or alternative investments.

It's a concentrated, low/medium risk portfolio. Agree with dunstonh - time to start again.

Thanks for your reply. Our risk tolerance is something we’re dealing with / deciding at present. We have no idea of our risk tolerance, but we’re slowly coming to realise that it might not be as low as we originally, naively, thought. 

Yours, and @dunstonh’s advice/information has made that decision easier. Thanks again. 

Langtang

Today, we got some more income cheques from the 2nd of these investments. They were all in my wife’s name. I am assuming that this will be classed as income? We’ve never had to pay income tax in any other way than through a pay packet, so have no idea where to start.

What do we have to do? Total is approx £450. 

@dunstonh @MaxiRobriguez