Vanguard LifeStrategy 100 or Index Tracker?

MX5huggy

Are you going to be using a S&S ISA then there’s no tax implications as long as you keep all the money in the ISA. If you’re using a General Investment Account then yes swapping investments is a trigger for Capital Gains Tax. But you probably want to trigger this every year so that you can use the £12300 annual allowance (which you can’t carry forward). 

Albermarle

s it easy to transfer down the line? For example say I build up £100K in Vanguard TSE Global All Cap, can I transfer this amount to VLS100 if I feel like it without tax implications? 

If you hold the funds within Stocks and shares ISA ( or pension) there are no tax implications for selling and buying new funds .

Outside these tax shelters , you have to keep an eye on possible Capital Gains tax and dividends tax liabilities.

Thrugelmir

YellowDuc said:

Albermarle said:

Would an ETF or Index tracker be best? Or something like Vanguard LifeStrategy 100?

All these types of investments are broadly similar and probably will give similar results .

VLS 100 has a higher UK % than a standard global tracker .

Ones following the FTSE World index have a % of Emerging Markets , whilst ones following the equivalent MSCI index have no Emerging markets .

For this I just wanted something that follows the markets and gives 8-12% a year or so.

The lower figure looks more realistic ( we all hope ) 

Thanks. I looked into S&P 500 too, but thats obviously US focused and I dont like the idea of currency fluctuations too 

Thanks for your help. I'll probably go or VLS 100 

Unless your overseas equity exposure is hedged. Then the value will be subject to currency movement. The impact of which should never be underestimated. Adds a highly volatile variable to the mix. 

YellowDuc

MX5huggy said:

Are you going to be using a S&S ISA then there’s no tax implications as long as you keep all the money in the ISA. If you’re using a General Investment Account then yes swapping investments is a trigger for Capital Gains Tax. But you probably want to trigger this every year so that you can use the £12300 annual allowance (which you can’t carry forward). 

Oh that's cool. So I could lump sum £10K into the VLS100 for instance and then do £500/month each year through my S&S ISA and then I wouldn't have to pay any taxes on anything I make from it? Aslong as I dont go over the £20K each year (which tbh would be quite unlikely I think). 

That's really interesting/useful. When I register to VLS100, do they ask me if im doing it through a S&S ISA or if its general investment account then? 

Do you know if I can pay this straight out of my business account, like I do with pensions? Or would it have to be done via my personal accounts? Just wondering from an Income Tax / Corporation Tax point of view. Not to worry if you're not sure, I'll check with my accountant as I have a meeting with him next week.

YellowDuc

Unless your overseas equity exposure is hedged. Then the value will be subject to currency movement. The impact of which should never be underestimated. Adds a highly volatile variable to the mix. 

Yeah, fully aware of that! The majority of my business income is from USA, or at least negotiated in USD. It can make a big difference.

MX5huggy

No you open an ISA with a platform provider then you deposit cash in the ISA then buy your investment. These two stages can be combined in one process. 

The platforms charge fees, Vanguard have their own platform but Vanguard funds are also available on other platforms. Vanguard charge 0.15% platform fee this is just about the cheapest for small sums under £30k ish. But your pension provider may offer as S&S ISA and depending on their fee structure it maybe cheaper to go with them. You will also pay fund fee which ever platform you use and some platforms charge trading fees, 

Thrugelmir

YellowDuc said:

Unless your overseas equity exposure is hedged. Then the value will be subject to currency movement. The impact of which should never be underestimated. Adds a highly volatile variable to the mix. 

Yeah, fully aware of that! The majority of my business income is from USA, or at least negotiated in USD. It can make a big difference.

Certainly a factor to be considered with your asset allocation. 

bostonerimus

VLS100 is a perfectly fine multi-asset fund for a young investor who is ok with some risk. The chances of it giving you 12% pa over the long term are small and you should plan on less, probably half. Is there any particular reason you mentions 8-12%? You should know where you want to go, and set your saving rate and portfolio to reach that goal.

grumiofoundation

bostonerimus said:

VLS100 is a perfectly fine multi-asset fund for a young investor who is ok with some risk. The chances of it giving you 12% pa over the long term are small and you should plan on less, probably half. Is there any particular reason you mentions 8-12%? You should know where you want to go, and set your saving rate and portfolio to reach that goal.

*Although doesn’t impact the inherent validity of it as a choice VLS100 is not a multi-asset fund (regardless of how many posters refer to it as such it remains mono-asset!)

tebbins

It's a fund of funds sold in the same range as multi-asset funds, it's a simple semantic error, neither I nor anyone else is asserting that it holds more than one asset class.
However since we're being anal linguistic prescriptivists, any fund that holds more than one asset is a multi-asset fund, perhaps the forum should adopt the tern "multi-asset-class fund", for accuracy.