Vanguard Life Strategy 60% - Vanguard SIPP or II?

lucyandthomas

SomeMadeUpName said:

Regardless, I think your own sums show you are a little better off consolidating in II.

My understanding though is still quite limited, as I only engaged in this retirement planning about 3 months ago.  So I'd wait until you are sure yourself or others have agreed.

You are well ahead of us (SIPP wise) at present, meaning our SIPP is better in Vanguard as the lower fund sizes make the % charging structure better (plus like you we currently have no interest in wide ranges of possible investments, too scary atm).

Sounds like we're at a similar knowledge stage - I've just started taking an interest in this recently. I have my Dad to thank for the fact I've got a pension at all - he virtually frogmarched me to the Bradford and Bingley when I started work to make me set one up! Very glad he did now (at the time I was a lot less impressed!).

II will be cheaper until I reach approx £300,000, but then Vanguard will be cheaper (if my maths is right), as they cap their management charge (the 0.15% bit) at £375: so, £375 + (0.22% x 300k) = £1035 with Vanguard versus £240 flat fee + (0.27% x 300k) = 1050 with II. Although looking at what eskbanker says, maybe Vanguard will change the extra 0.05% somewhere. So confusing.

AlanP_2

Just compare the £375 with the £240 platform costs.

VLS60 costs the same wherever you buy it from.

SomeMadeUpName

lucyandthomas said:

SomeMadeUpName said:

Regardless, I think your own sums show you are a little better off consolidating in II.

My understanding though is still quite limited, as I only engaged in this retirement planning about 3 months ago.  So I'd wait until you are sure yourself or others have agreed.

You are well ahead of us (SIPP wise) at present, meaning our SIPP is better in Vanguard as the lower fund sizes make the % charging structure better (plus like you we currently have no interest in wide ranges of possible investments, too scary atm).

Sounds like we're at a similar knowledge stage - I've just started taking an interest in this recently. I have my Dad to thank for the fact I've got a pension at all - he virtually frogmarched me to the Bradford and Bingley when I started work to make me set one up! Very glad he did now (at the time I was a lot less impressed!).

II will be cheaper until I reach approx £300,000, but then Vanguard will be cheaper (if my maths is right), as they cap their management charge (the 0.15% bit) at £375: so, £375 + (0.22% x 300k) = £1035 with Vanguard versus £240 flat fee + (0.27% x 300k) = 1050 with II. Although looking at what eskbanker says, maybe Vanguard will change the extra 0.05% somewhere. So confusing.

Exactly, @eskbanker is saying the VLS60 will cost the same wherever, it is just presented more openly on II that there is aprox an extra 0.05% to budget for.

So Vanguard versus II (setting aside the greater choice on II) comes down to:

12x£20 versus 0.15% (capped at £375), so it's all down to fund size.  Just eliminate the VLS 0.22/0.27% from your calcs.

II though does cover ISA etc in that charge, and there is that greater choice if you ever wanted to go more speculative on a small portion.

Oooo, listen to me sounding all knowledgable!

eskbanker

SomeMadeUpName said:

Exactly, @eskbanker is saying the VLS60 will cost the same wherever, it is just presented more openly on II that there is aprox an extra 0.05% to budget for.

[...]

Oooo, listen to me sounding all knowledgable!

You're nearly right but the 0.05% doesn't need to be 'budgeted for', as you don't visibly pay it as such - it's an internal cost within the fund, so any time you see fund performance figures they're given after accounting for such costs (including the OCF).

lucyandthomas

@SomeMadeUpName

Ha ha - yes, very impressed! 

Vanguard also include ISA/JISA etc in their charge. It sounds like it's basically a question of weighing up the effort (probably not very much if I'm honest) to open up an II account and transfer my small Vanguard SIPP (and probably my son's JISA) to save £135 quid a year. 

lucyandthomas

That said, I've been happy with Vanguard. I like the platform and the app, and they've responded quickly when I've asked a couple of questions. No experience with II. Maybe a case of 'better the devil you know'. Now I realise the cost difference between II and Vanguard SIPPs is less than I first thought, I might just stick with Vanguard. Something to mull over.

Thanks everyone for your help.

SomeMadeUpName

eskbanker said:

SomeMadeUpName said:

Exactly, @eskbanker is saying the VLS60 will cost the same wherever, it is just presented more openly on II that there is aprox an extra 0.05% to budget for.

[...]

Oooo, listen to me sounding all knowledgable!

You're nearly right but the 0.05% doesn't need to be 'budgeted for', as you don't visibly pay it as such - it's an internal cost within the fund, so any time you see fund performance figures they're given after accounting for such costs (including the OCF).

Yeah, I know, but what better way to phrase it?

Maybe 'accounted for' but that's not great either, maybe 'taken into consideration'.  Yep, that will do.

colmel16

Just as a point of reference if you do decide to use ii then using a cashback site such as quidco would give you £196 cashback.

Lostweekend

I use ii and my wife uses Vanguard. We recently both switched our age old Halifax SS ISAs over to our respective platforms.

With ii the transfer was smooth and happened in a couple of weeks. With my wife's Vanguard she is still waiting, some 12 weeks later and despite regular messaging to them, calling them and receiving promises to call her back we are no further on. Halifax say they are waiting for Vanguard to contact them.  I like Vanguard but they haven't covered themselves with glory on this.

My experience of ii has been that they have been really helpful, accessible and easy to deal with.

lucyandthomas

Lostweekend said:

I use ii and my wife uses Vanguard. We recently both switched our age old Halifax SS ISAs over to our respective platforms.

With ii the transfer was smooth and happened in a couple of weeks. With my wife's Vanguard she is still waiting, some 12 weeks later and despite regular messaging to them, calling them and receiving promises to call her back we are no further on. Halifax say they are waiting for Vanguard to contact them.  I like Vanguard but they haven't covered themselves with glory on this.

My experience of ii has been that they have been really helpful, accessible and easy to deal with.

Thanks for your message - interesting to hear from someone with recent experience of both. Starting to think I should bite the bullet and go with II.