Investment

GTB01

Hi I’m 23 years old and I’m looking to get into long term investing, I have about £5000 so far to invest then want to add to that every month. I’ve looked at investing into a few funds like vanguard etc. 

xylophone

You could open a stocks and shares ISA with the likes of Hargreaves Lansdown/Fidelity/AJ Bell etc - you then have a wide choice of investments including Vanguard funds.

https://monevator.com/low-cost-index-trackers/

ColdIron

Well done, thanks for letting us know

I trust this isn't all your money and you have already set aside enough for other expenses and goals, perhaps a deposit for a flat or other property?

jimjames

Vanguard as a platform is a good place to start as the charges are % based so won't be huge as you start out. There are however many different funds that Vanguard offer so you'll need to do some research to work out which one/s you want to invest in. "A few funds like vanguard etc." doesn't really give much info as Vanguard isn't a fund but an investment company that offers many. As above you also need to consider money as an emergency fund and for anything you might need short term.

daimes

A popular fund is the Vanguard LifeStrategy 60% Equity Fund. Over the past 10 years it has delivered a consistent 7.5% pa return with annual volatility of 8%. This is good but you can do much better.

Here is an alternative portfolio with exactly the same risk profile 8% volatility over the past 10 years.

Blackrock Cash D Inc	GB00B42XLZ68	42.90%
Fidelity Funds Global Tech	LU1033663649	44.40%
L&G Global 100 Index	GB00B0CNH056	12.70%

This has delivered a smooth 11.75% return over the past 10 years from 8% volatility (risk) - much better!



HOWEVER
If you are making regular contributions to a pension fund over a long period of time you need something far more volatility with much higher likely performance.

Albermarle

GTB01 said:

Hi I’m 23 years old and I’m looking to get into long term investing, I have about £5000 so far to invest then want to add to that every month. I’ve looked at investing into a few funds like vanguard etc. 

There are lot and lots of threads on here with similar questions and replies, so have a scroll through.

clt1979

daimes said:

A popular fund is the Vanguard LifeStrategy 60% Equity Fund. Over the past 10 years it has delivered a consistent 7.5% pa return with annual volatility of 8%. This is good but you can do much better.

Here is an alternative portfolio with exactly the same risk profile 8% volatility over the past 10 years.

Blackrock Cash D Inc	GB00B42XLZ68	42.90%
Fidelity Funds Global Tech	LU1033663649	44.40%
L&G Global 100 Index	GB00B0CNH056	12.70%

This has delivered a smooth 11.75% return over the past 10 years from 8% volatility (risk) - much better!



HOWEVER
If you are making regular contributions to a pension fund over a long period of time you need something far more volatility with much higher likely performance.

At 23 years old I wouldn’t personally go for vanguard LS 60. A lot of years of investing means I would go LS100 myself. That’s just me though as would have a long time to ride out the volatility.

JohnWinder

'Vanguard LifeStrategy 60% Equity Fund. Over the past 10 years it has delivered a consistent 7.5% pa return with annual volatility of 8%.

'The question is,’ said Alice, ‘whether you can make words mean so many different things.’ Lewis Carroll.

'consistent' for example. The recent annual VLS returns have been 10%, -11%, 10%, 8%. 15%, -3%, 8%, 18%. Consistent takes on a new meaning.

I defy the OP tell us what you mean by annual volatility of 8% because Vanguard tells me nothing about that, if it's a caveat to 'consistent'.

... 7.5% pa return with annual volatility of 8%. This is good but you can do much better.'

You're mixing your verb tenses here: 'delivered' is past tense, 'can do' is what happens now which is useless since it's the future performance of investments that matter. It's a big hazard in investing to confuse the past tense with other tenses.

The chart nicely shows you could have done better than VLS60 over the last decade. Just 10 years too late to be helpful. Tell us what will (or can with what probability) do better than VLS60 in the next decade and I'm all ears.

At 23 years old you have so much potential to make such a beneficial outcome from you personal investing that you should read something like Tim Hale's book Smarter Investing.

MEM62

clt1979 said:

daimes said:

A popular fund is the Vanguard LifeStrategy 60% Equity Fund. Over the past 10 years it has delivered a consistent 7.5% pa return with annual volatility of 8%. This is good but you can do much better.

Here is an alternative portfolio with exactly the same risk profile 8% volatility over the past 10 years.

Blackrock Cash D Inc	GB00B42XLZ68	42.90%
Fidelity Funds Global Tech	LU1033663649	44.40%
L&G Global 100 Index	GB00B0CNH056	12.70%

This has delivered a smooth 11.75% return over the past 10 years from 8% volatility (risk) - much better!



HOWEVER
If you are making regular contributions to a pension fund over a long period of time you need something far more volatility with much higher likely performance.

At 23 years old I wouldn’t personally go for vanguard LS 60. A lot of years of investing means I would go LS100 myself. 

That would tend to be my view also.  

Ggplyr

At 23 years old I'd go full equities.  Probably just vanguard's s&p500 tracker. 

george4064

Ggplyr said:

At 23 years old I'd go full equities.  Probably just vanguard's s&p500 tracker. 

S&P 500 tracker only accounts for about 60% of the world, so you’d be making a big active decision by excluding the remaining 40% of the world (covering Europe, emerging markets, and other non-US exposure).

If you’re comfortable with that then go for it, but sensible thing would be to invest globally and be happy with the c60% US exposure you’d get.