Vanguard SIPP - invest or cash?

harlequinnyc

I have a Vanguard SIPP, which has lost money on the invested part since opening in June last year. I understand the general consensus is to leave money invested in pensions and over the long term, they will more often increase - but given our unprecedented times, is this still likely?

Come the new tax year, I intend to pay in another £2880, being a non tax payer but should I invest this, or just be grateful for the tax relief and leave as cash?

Sorry if this is a very dim basic question but I am still dim and basic when it comes to these matters.  

thecleaner_2

How long do you have until retirement?

Personally, I dont think these times are particularly different to various events over the past 20 years I've been investing

Albermarle

I understand the general consensus is to leave money invested in pensions and over the long term, they will more often increase - but given our unprecedented times, is this still likely?

Without a crystal ball nobody can give you an answer . There is always bad news that may or may not upset the markets . Today is no different .

Come the new tax year, I intend to pay in another £2880, being a non tax payer but should I invest this, or just be grateful for the tax relief and leave as cash?

It largely depends on when you will want to withdraw the money . If it will be in less than 5 years you could be better keeping it as cash . Longer then 5 years probably better to invest . Some would say now is a good time to invest as prices are lower.

harlequinnyc

thecleaner_2 said:

How long do you have until retirement?

Personally, I dont think these times are particularly different to various events over the past 20 years I've been investing

I am retired now.  I took (very) early retirement last October, at 50.

dunstonh

I understand the general consensus is to leave money invested in pensions and over the long term, they will more often increase - but given our unprecedented times, is this still likely?

What is unprecedented about current times?   Indeed, things seem more like the historical norm at the moment.

You are also not invested in pensions.  The pension is the tax wrapper that contains your investments.  It is the investments that zig zag in value.  You haven't mentioned what your investments are.   If you invested 100% in a Russian equities fund then the response you would get would be different to if you invested in a diverse spread of global assets.

where_are_we

Things to consider (1) you cannot access money in your SIPP until 55 at present and the government plan to increase this to 57 on the 6/4/2028. (2) A loss over a 10 month investment period is not unusual - do not be concerned because you have a further 4 years and more before you consider your position. (3) Adding £2880 net to your SIPP each tax year you have no earned income, is a good idea providing you do not need the money for almost 5 years. However to leave that in cash would  not be advisable taking inflation into account (Vanguard pay very little interest on cash if any at all). (4) If you are very risk averse, invest the £3600 gross in a low risk Vanguard fund.

macman

With inflation likely to hit 8% or more, and remain there for some time, leaving your funds in cash is not a wise solution, You cannot judge a fund by it's performance over just 9 months, be the times 'unprecedented' or not.
What funds are you actually invested in?

QrizB

harlequinnyc said:

I have a Vanguard SIPP, which has lost money on the invested part since opening in June last year.

I'm a little surprised by this; Mrs QrizB and I both have investments with Vanguard and they're up over a similar period. Which Vanguard fund(s) did you choose?

k_man

LS 40 and 20 are both down since June by a few %.

But they were never going to be super growers.

Thrugelmir

thecleaner_2 said:

Personally, I dont think these times are particularly different to various events over the past 20 years I've been investing

That’s how markets are driven - opinion.  Direction is ultimately determined by the majority.

EdSwippet

Thrugelmir said:

thecleaner_2 said:

Personally, I dont think these times are particularly different to various events over the past 20 years I've been investing

That’s how markets are driven - opinion.  Direction is ultimately determined by the majority.

It's a dreadful pity, not to mention a squandering of talent, that the many Nobel prizewinners and PhDs who work in financial modeling lack your insight that it's all just down to opinion.