A temporary haven for cash

valiant24

I've a tidy sum (about £100k) within my SIPP, transferred from another pension, that I have not invested yet.  Given that my SIPP is otherwise invested in VWRP and index-linked gilts, I'm not in a hurry to invest it in the current turmoil.

Are there are cash-like investments that it could be put into for a while?  I seem to remember that Vanguard had some sort of ETF that just invested money in cash accounts.

Thanks
V

ColdIron

There are money market funds but the return is so low that it is often exceeded by fees

Some SIPP providers pay interest on cash (HL, tiered, 1.10% on £100k +) while others like Vanguard, I believe, charge for cash

Adyinvestment

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

valiant24

Adyinvestment said:

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

The SIPP platform is AJ Bell and they don't pay interest on cash balances.  So it would have to be some other provider's ETF if it's going to happen at all.  In my mind Vanguard had some such in the past.

Albermarle

Adyinvestment said:

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

2% minus a fee minus platform charge, so I think about 1.65% net, which is better than their main rivals.

wmb194

Directly owned short dated gilts i.e., not via an ETF.

https://markets.ft.com/data/bonds

valiant24

Gilts.   Shudder ........

wmb194

valiant24 said:

Gilts.   Shudder ........

At least you can earn something on them now and they're cash-like.

cloud_dog

Albermarle said:

Adyinvestment said:

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

2% minus a fee minus platform charge, so I think about 1.65% net, which is better than their main rivals.

Vanguard do confuse me a little as to whether they charge the platform fee on the whole account value or whether they exclude charges for cash.

On their fees page, for Cash Balances --> Service Fee, they state:

"We don't currently charge a service fee for holding your cash - but we do keep up to 0.20% of any interest we receive on your cash.  This is to cover our banking costs."

So based on this you might get 1.8% (2% minus 0.2%).

BTW @Albermarle , can you confirm where you sourced the information for them paying (currently) 2%?  I've not been able to locate anything confirming a 'current rate', whenever I have tried to find it.

ColdIron

cloud_dog said:

Albermarle said:

Adyinvestment said:

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

2% minus a fee minus platform charge, so I think about 1.65% net, which is better than their main rivals.

Vanguard do confuse me a little as to whether they charge the platform fee on the whole account value or whether they exclude charges for cash.

On their fees page, for Cash Balances --> Service Fee, they state:

"We don't currently charge a service fee for holding your cash - but we do keep up to 0.20% of any interest we receive on your cash.  This is to cover our banking costs."

It is confusing, on the same page under Account Fee they state

This fee covers the costs of running our online service, customer support team and keeping your investments secure. You only pay one account fee, even if you have more than one account with us. For example, if you have a Stocks and Shares ISA and a General Account. The fee is based on the overall value of your Vanguard accounts, including any cash held.

Rather contradictory. What's the difference between the service fee and the account fee (the 0.15% per year charge)?

Albermarle

cloud_dog said:

Albermarle said:

Adyinvestment said:

Last time I checked Vanguard do give some interest on cash balances, might be worth checking what it is at the moment.

2% minus a fee minus platform charge, so I think about 1.65% net, which is better than their main rivals.

Vanguard do confuse me a little as to whether they charge the platform fee on the whole account value or whether they exclude charges for cash.

On their fees page, for Cash Balances --> Service Fee, they state:

"We don't currently charge a service fee for holding your cash - but we do keep up to 0.20% of any interest we receive on your cash.  This is to cover our banking costs."

So based on this you might get 1.8% (2% minus 0.2%).

BTW @Albermarle , can you confirm where you sourced the information for them paying (currently) 2%?  I've not been able to locate anything confirming a 'current rate', whenever I have tried to find it.

It was from another thread recently where the poster had actually called Vanguard to double check. I took this at face value.