1688 days.

[Deleted User]

NannaH said:

when taking the yield from funds  as income -  if the yield taken is 5% but the growth is 10% in any given year,  does the pot grow 5% or 10% ( after yield taken and before charges) ,  I assume it’s 5% ?  

If capital gains/growth is 10% and yield 5% then you are left with a 10% larger pot after withdrawing the dividends/yield.  

Some funds don’t distribute yield but add it to the value of units or “accumulate”.  In that case “growth” is inclusive of both capital gains and yield.

Diplodicus

Usually the latter: automatic reinvestment back into the fund. 
Looks better performance wise and leaves the client less to do. 

justcheckin

Hi, I was interested in your DFW/MFW/FIRE journey and went for a walk through old posts. In 2016 you said this:

My wife and I are both 40% tax payers although my income has just passed the £100 k barrier.

Although you are clearly saving a lot of money at the moment, I am wondering how you are sure that 5k (net?) per month is your correct 'number' to live off for the rest of your lives.

You have 2 young adult children, is helping them through professional training and first house purchases part of the plan for the next few years too?

Just questions, I wish you all the best in your journey to FIRE 

Audaxer

NannaH said:

when taking the yield from funds  as income -  if the yield taken is 5% but the growth is 10% in any given year,  does the pot grow 5% or 10% ( after yield taken and before charges) ,  I assume it’s 5% ?  

If you have a starting capital value of £100k and it pays out dividends of £5k, and the capital value also increases by 10% for the year, the capital value will be increased to £110k. If the dividends were reinvested during the year, the capital value at the year end would slightly more than £115k.

BritishInvestor

Diplodicus said:

Go for growth stocks, andys15. More volatile than high yield stocks but less volatile than crypto (of which I know nothing).

Growth stocks have to be one of the most crowded trades in recent history

andys15

justcheckin said:

Hi, I was interested in your DFW/MFW/FIRE journey and went for a walk through old posts. In 2016 you said this:

My wife and I are both 40% tax payers although my income has just passed the £100 k barrier.

Although you are clearly saving a lot of money at the moment, I am wondering how you are sure that 5k (net?) per month is your correct 'number' to live off for the rest of your lives.

You have 2 young adult children, is helping them through professional training and first house purchases part of the plan for the next few years too?

Just questions, I wish you all the best in your journey to FIRE 

Thanks. One child is on the house ladder and the other is still at home at the start of their career. 

My posts throughout the years probably demonstrate that I don’t really know what I am doing. 

I suppose I have just always winged it. I think i have been winging it my whole adult life. 

My only research for buying shares was going through my SIPP portfolio and looking at the best dividend stock and buying them. 

My next play on payday will be looking at the ones which are down the most and buying more of them. 

My £5k gross a month is based purely on those who have retired and asking what they spend. 

I would love to research but the truth is I don’t know what I am doing and when I try to research I unfortunately get bored and stop. 

My saving plans are based on 0 growth, not thinking about inflation but not including the potential rent I could get on my house when we go to Spain, my wife’s healthy pension or state pension. I see them as a bonus. 

I appreciate this is an awful way to do things. I am not maximising my potential but I also think that I am doing something positive and even though not maximising what I could get, I am still saving money. 

intgomo

andys15 said:

My only research for buying shares was going through my SIPP portfolio and looking at the best dividend stock and buying them. 

If you don't have the time to research your stock market investments fully then I'd argue that you're essentially gambling with your money, especially if you're picking individual stocks without a clear strategy.  There are plenty of posts on here to help you build knowledge on what constitutes a balanced portfolio, mostly using a combination of funds, bonds etc. to create diversification in line with your risk appetite, but another option that might suit your busy life better could be passive investing.

For more information, start here: Passive investing Archives - Monevator

andys15

I have a little plan but wether it’s the best plan who knows. Even the last few posts on here about growth stocks show there is arguments either way. 

My first £80k will be to fill this years and next years ISAs to buy FTSE 100 and possible ftse 250 individual stocks. 

My next £170k in a fixed interest 5 year paying 2%. Not sure how I will do that yet. 

Then the next £100k in premium bonds.  I can then save another £80k or so before my retirement. 

The £170k is fixed and can’t be touched until a few years into retirement. So I will live off the premium bonds and last 80k saved. 

The ISAs can be touched as and when. Then 7 years after I retire I will have access to my SIPP and my wife’s pension ( that too will take a massive hit by retiring early). 

Very simplistic I know. But the 1688 days is a target. If things aren’t going to plan then I will have to work for another 18 months or so. 

[Deleted User]

People will have different opinions on growth vs value. Nor does one need an opinion on growth vs value to invest successfully.   Most of us would agree though that using your small fund to randomly buy  individual FTSE stocks isn’t the way to do it. 

andys15

So what would you do with £8k a month?