Pension consolidation / transfer

Alexland

noclaf said:

The 'Future proof' aspect leans me towards Fidelity, I can simply add more pensions as and when I need to e.g if I leave my current employer.

Of course there is always the risk that platforms will change their charging models. The only fiddly bit I find with Fidelity is that to avoid trade costs to sell down ETF units to pay ongoing charges I keep a little bit of spare money in a traditional fund which has no trade fees to buy or sell and only costs a couple of pence per month in platform fees. Mostly the cash balance is refilled by the spare money from some of dividends that cannot be fully reinvested into whole ETF units as they do not support fractionals. It depends on the ETF unit price and I find at circa £68/unit VEVE creates a modest cash surplus but on HMWO at £23/unit it's a bit tight.

noclaf said:

It's likely that if I do go ahead would transfer the initial £35k and invest the whole lot (aside from a small balance to cover fees) using a single transaction into a cheap global or Dev world ETF, most likely VEVE unless there is an Acc version or similarly priced accumulating global ETF available. 

Well there is VHVG which is also on Fidelity but it's less common so the market spread is higher. VEVE is currently showing an indicative spread of 0.07% compared to VHVG at 0.25%. I prefer big liquid ETFs that can easily be traded in large volumes without any material impact to the price and for that I am happy to pay Fidelity £1.50 to reinvest the divis and leftover divis help with paying the fees as above.

noclaf

Regarding the charging model, that's something I accept given the competition of providers to get us in the door, I guess we have to remain willing to monitor and adjust as needed e.g: changing providers when it makes sense.

Interestingly, I will be using VHVG in my LISA (regular payment has been setup but it's essentially a single big payment for the whole lot (total investment value) then I will cancel the regular payment, was using LCWL previously.

I think for the Fidelity account I will just use VEVE, seems a reasonably well established etf, it's cheap and 1.50 to reinvest divis is cheap. Is there any additional admin needed to setup the Divi reinvestment? As you also point out using VEVE seems a sensible approach to help ensure there is enough cash left on the account to cover charges. I did look at HMWO, another good option but less appealing based on the pricing.

Alexland

noclaf said:

Is there any additional admin needed to setup the Divi reinvestment?

I don't know the default setting on a new account (probably not to reinvest) but once you login to Fidelity there is a "Manage Investments" menu at the top then select "Income Management" and then select "Edit Settings" against the account then you can either change the settings for all investments or per individual holding.

noclaf said:

I did look at HMWO, another good option but less appealing based on the pricing.

We only hold HMWO in my wife's SIPP to stop us having excessive exposure to Vanguard and so it shows as a separate line on my HL app watchlist. My preference is VEVE.

noclaf

Alexland said:

noclaf said:

Is there any additional admin needed to setup the Divi reinvestment?

I don't know the default setting on a new account (probably not to reinvest) but once you login to Fidelity there is a "Manage Investments" menu at the top then select "Income Management" and then select "Edit Settings" against the account then you can either change the settings for all investments or per individual holding.

noclaf said:

I did look at HMWO, another good option but less appealing based on the pricing.

We only hold HMWO in my wife's SIPP to stop us having excessive exposure to Vanguard and so it shows as a separate line on my HL app watchlist. My preference is VEVE.

My 86k pension (current employer) is pretty much all in Vanguard apart from a small % allocated to a BG fund, my LISA and S&SISA are all in Vanguard funds.....in my shoes would you consider using a different provider for the Fidelity pension e.g: HSBC or even a cheap Fidelity fund/etf?

Alexland

noclaf said:

My 86k pension (current employer) is pretty much all in Vanguard apart from a small % allocated to a BG fund, my LISA and S&SISA are all in Vanguard funds.....in my shoes would you consider using a different provider for the Fidelity pension e.g: HSBC or even a cheap Fidelity fund/etf?

I like a good spread of fund managers and platforms but that's not a universally accepted view as the risk with mainstream providers is minimal but still over enough years something horrible might go wrong with one of them. About 40% of our money is in my VEVE holding and about 60% on Fidelity and that's too much for my preference so we haven't been transferring any more money into our Fidelity SIPPs for a few years preferring to make our contributions elsewhere especially as our workplace pension options have improved although the growth on the existing investments has been outpacing our ability to contribute. A prolonged market crash would help even things out!

noclaf

Alexland said:

I like a good spread of fund managers and platforms but that's not a universally accepted view as the risk with mainstream providers is minimal but still over enough years something horrible might go wrong with one of them. About 40% of our money is in my VEVE holding and about 60% on Fidelity and that's too much for my preference so we haven't been transferring any more money into our Fidelity SIPPs for a few years preferring to make our contributions elsewhere especially as our workplace pension options have improved although the growth on the existing investments has been outpacing our ability to contribute. A prolonged market crash would help even things out!

I guess taking the combined value of my LISA/Pensions/S&SISA's it could be argued that it's not really a concern at this point but I do like the idea of some diversification in providers though I agree with sentiment shared by other posters when I've posed this question in the past that if Vanguard is ever in trouble, we have bigger issues to worry about

Just out of interest do you use a 100% passive approach across all your investments and just ETF's or ETF's and funds? I am using both Active/Passive but questioning the higher costs of the Active funds as returns might be more subdued for the next few years (US Equities in particular)

Alexland

noclaf said:

Just out of interest do you use a 100% passive approach across all your investments and just ETF's or ETF's and funds? I am using both Active/Passive but questioning the higher costs of the Active funds as returns might be more subdued for the next few years (US Equities in particular)

I was using a UK investment trust in my S&S ISA as it was a nice feeling to know that the 4% dividends were enough to cover my mortgage, council tax etc if we ever became unemployed however I decided to switch that back to global passive so sold it last night and bought SWDA this morning (after the markets dropped 2% overnight, lucky me) and will just hold a bit more cash. I was quite concerned about US valuations and rising interest rates but the recent growth in earnings has been encouraging and I could see a path to getting back to reasonable without needing to crash but I guess we will all see what happens with the latest versions of the virus. As we are still accumulating I am pretty relaxed if the market goes up or down from here. The best thing that could happen is that prices drop so our next decade of contributions and dividend reinvestments are buying in at lower prices.

noclaf

Alexland said:

As we are still accumulating I am pretty relaxed if the market goes up or down from here. The best thing that could happen is that prices drop so our next decade of contributions and dividend reinvestments are buying in at lower prices.

Yep same here, I am 40...a market crash now would be timely timing (pardon the pun!)