Alternatives to Vanguard in my situation

waveydavey48

I sadly lost my wife and am trying to sort out my finances. I have a tentative plan and would welcome observations.

I'm 60, have retired, have enough secure income to live OK (OK ish DB pension and cash to bridge until SP starts), the question is what to do with SIPP/ISA's.

My DC pension is from my time working for Direct Line, is managed by Fidelity and has about £150k in it. My own and my wife's S&S ISA are both with Vanguard and have about £80k each in, she has a tiny SIPP also with Vanguard.

I have no debts, no dependents and mortgage paid off. I will probably take lump sums from the DC pension and ISA's to whittle that down to zero by, say age 80 and use the money for gifts to relatives, house repairs, charity donations etc.

Our ISA's are both in Lifestrategy 60/40. My initial thought is to transfer my DC pension to Vanguard, also in LS60 as I believe fees are capped when the amount across all accounts is £250k and I will have about £320k. 

I'm sure people will say (rightly) that it's the performance of the fund that matters rather than the fees but LS60 seems as good as most and I'm not aware of a better option and saving fees on £70k is not to be sniffed at. I don't think I need an IFA.

I would welcome observations.

Finally, there is no will so I assume I must apply for letters of admin. As everything is coming to me as spouse can I assume there is no IHT to pay?

Thanks folks.

Mutton_Geoff

Sorry to hear of your loss. My personal suggestion for your tentative plan is do nothing. Provided you have enough money to live, there are more important things to be done, including allowing yourself to grieve. Many people (myself included) like to get busy with "important admin" as a way to escape grief but this could lead to regrettable mistakes.

There are lots of useful websites to help with the admin side of bereavement inc the govt Tell Us Once - https://www.gov.uk/after-a-death/organisations-you-need-to-contact-and-tell-us-once

Other than that, please allow yourself time. Plenty of it.

JohnWinder

I'm sure people will say (rightly) that it's the performance of the fund that matters rather than the fees

And you will think to yourself: yes, but we don’t know what the performance will be in the future, and we read often enough that past performance is no guarantee and not a great indicator of future performance. On the other hand, fees are very definite. 

eskbanker

waveydavey48 said:

the question is what to do with SIPP/ISA's

Not sure what happens to SIPPs but her ISA will be closed, and you'll have the equivalent value available to you to put into your own ISA (as an Additional Permitted Subscription) if that's what you choose to do, although, as above, there's no rush to be making decisions.  However, that's really just an administrative detail, rather than the more fundamental decision about how much of the overall total to invest and in which product(s) and on which platform(s)....

[Deleted User]

Your initial thoughts are solid.  An infinite number of other options exists but you picked one of the good ones. Simplicity is a massive advantage.  

Personally I would have picked higher equity percentage given that you already have ample DB income and volatility isn’t too much of a concern but your tolerance to short term volatility is something only you can estimate. So what you picked is a great choice.  

Like JW says, fees are very important because, unlike returns, they are certain. 

Fermion

eskbanker said:

waveydavey48 said:

the question is what to do with SIPP/ISA's

Not sure what happens to SIPPs but her ISA will be closed, and you'll have the equivalent value available to you to put into your own ISA (as an Additional Permitted Subscription) if that's what you choose to do, although, as above, there's no rush to be making decisions.  However, that's really just an administrative detail, rather than the more fundamental decision about how much of the overall total to invest and in which product(s) and on which platform(s)....

I don't think this is totally correct - it depends on the date of death. This is what HL say about APS:-

"Anyone who was married or in a civil partnership with someone who died on or after 3 December 2014 can now apply for an additional ISA allowance, known as the Additional Permitted Subscription (APS).

If the deceased died before 6 April 2018, the APS is equal to the value of the ISA on the date of death. For example, if your spouse died on or after 3 December 2014 (but before 6 April 2018) with an ISA valued at £50,000, this would be your APS.

If the deceased died on or after 6 April 2018, their ISA will become a 'continuing ISA'. It will keep this status until the earliest of:

• The completion of the administration of the estate
• The 3rd anniversary of the date of death
• The closure of the ISA due to all the funds being withdrawn

In this case, the APS is equal to the higher of the value of the ISA on the date of the investor's death or the value of the ISA on the date it stops being a 'continuing ISA'.

Where an investor held ISAs with several companies, a separate APS will be available for each."