Fund selection for JSIPP

LV_426

I'm currently setting up a JSIPP for my 12 year old daughter. I've gone with Fidelity. In terms of fund selection, my thinking is that because this is a very long term investment, a more adventurous growth focused fund would be the right choice. Fund I've picked has 86% equities, 0.2% charge. 
Any thoughts?

dunstonh

In terms of fund selection, my thinking is that because this is a very long term investment, 

Is it really a very long term investment?   Long term is generally considered as 15+ years.    You calling it very long term would suggest longer that that.   However, she is 12 and gets access to it in 6 years time.  She may leave it in for longer but very long time would suggest she would be leaving it in until her 30s+

Time does dilute the risk in most periods.

Linton

dunstonh said:

In terms of fund selection, my thinking is that because this is a very long term investment, 

Is it really a very long term investment?   Long term is generally considered as 15+ years.    You calling it very long term would suggest longer that that.   However, she is 12 and gets access to it in 6 years time.  She may leave it in for longer but very long time would suggest she would be leaving it in until her 30s+

Time does dilute the risk in most periods.

That was my thought at first but since it is a JSIPP she presumbly wont have access ffor 45 years at least which is certainly long term.  For 45 years I would go 100% equity.

LV_426

dunstonh said:

In terms of fund selection, my thinking is that because this is a very long term investment, 

Is it really a very long term investment?   Long term is generally considered as 15+ years.    You calling it very long term would suggest longer that that.   However, she is 12 and gets access to it in 6 years time.  She may leave it in for longer but very long time would suggest she would be leaving it in until her 30s+

Time does dilute the risk in most periods.

Can JSIPP funds be accessed that early? I thought it was the same as all other pensions.
My simplistic logic was that the time period is so long, that a higher risk fund wouldn't matter. At this point it's about maximising growth.

MX5huggy

Go 100% equity with a lower fee. 

She can change it is she wishes.

JSIPP is a bonkers product for all but the rich. (Used all your own ISA and SIPP allowances this year?).

LV_426

MX5huggy said:

JSIPP is a bonkers product for all but the rich. (Used all your own ISA and SIPP allowances this year?).

Why do you say that? I'm far from rich, and no I've not used all my allowances.
Is there a better long term savings vehicle, with similar tax benefits?

dunstonh

LV_426 said:

dunstonh said:

In terms of fund selection, my thinking is that because this is a very long term investment, 

Is it really a very long term investment?   Long term is generally considered as 15+ years.    You calling it very long term would suggest longer that that.   However, she is 12 and gets access to it in 6 years time.  She may leave it in for longer but very long time would suggest she would be leaving it in until her 30s+

Time does dilute the risk in most periods.

Can JSIPP funds be accessed that early? I thought it was the same as all other pensions.
My simplistic logic was that the time period is so long, that a higher risk fund wouldn't matter. At this point it's about maximising growth.

Sorry. My bad.  I saw the J and went straight to JISA.        SIPPs of course are very very very long term in this case! 

noclaf

I have a JISA with Fidelity for my son and have gone with a single fund; Fidelity P World Acc....cheap fund fee of 0.10% (includes the 0.02% discount). No EM coverage in there but not too bothered at the moment.

MX5huggy

LV_426 said:

MX5huggy said:

JSIPP is a bonkers product for all but the rich. (Used all your own ISA and SIPP allowances this year?).

Why do you say that? I'm far from rich, and no I've not used all my allowances.
Is there a better long term savings vehicle, with similar tax benefits?

Put it in your own SIPP then you can access it 30 to 40 years earlier give it to your daughter then she can put it in her own SIPP getting another bite of tax relief. Or ISA it so she can put it in an LISA and then buy a house, it’s just really inflexible to use a JSIPP.

LV_426

MX5huggy said:

LV_426 said:

MX5huggy said:

JSIPP is a bonkers product for all but the rich. (Used all your own ISA and SIPP allowances this year?).

Why do you say that? I'm far from rich, and no I've not used all my allowances.
Is there a better long term savings vehicle, with similar tax benefits?

Put it in your own SIPP then you can access it 30 to 40 years earlier give it to your daughter then she can put it in her own SIPP getting another bite of tax relief. Or ISA it so she can put it in an LISA and then buy a house, it’s just really inflexible to use a JSIPP.

Inflexible? You're talking about two different financial products here. Both have their place. I agree an ISA is more accessible, and she already has a JISA. I don't think it's a good idea to completely ignore a (J)SIPP, and the sooner you start contributions, the better. The govt kindly gives you an extra £720/year, which isn't the case with an ISA. I'll take the free money.

UrbanAchiever

I did the same for my then 12 year and 13 year old sons, 2 years ago.

I also chose fidelity for their zero fees on a JSIPP.  Given the time horizon I have gone 100% equities with a UBS S&P500 (Acc)  low cost index tracker.