Choosing SIPP investments

KDF

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

Marcon

KDF said:

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

What's your attitude to risk?

MallyGirl

KDF said:

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

do you mean HSBC Global Strategy?

KDF

Marcon said:

KDF said:

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

What's your attitude to risk?

Moderate, I would say, as a higher rate tax payer, I’m aware the combination of tax savings and NI savings as I’m using salary sacrifice mean my SIPP balance has only ‘cost’ me approx. 50% of it’s value. That said I want to see the value grow and as I’m in my early 50s need to factor that in 

KDF

MallyGirl said:

KDF said:

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

do you mean HSBC Global Strategy?

No Rathbone Global Opportunity 

tacpot12

I would look at charges, performance history, size of the fund, and what the aim of the fund is.  

You want low charges. High charges need to be more than offset by performance as there are no guarantees with performance so you need some buffer in case performance weakens.  

Looking at performance history doesn't guarantee good performance in future, but bad performance in the past (compared to similar investments) suggests that the management or tracking algorithm isn't very good. 

You want the aim of the fund to match your investment aims. (Similarly with risk - you want the fund's risk profile to match yours). 

You want the size of the fund to be appropriate to its structure and aims. An actively managed fund needs shouldn't be too small or too large. £500m to £1bn is usually ok. A passive fund should ideally be large, i.e. >1bn. 

One final thought - don't overthink the decision. An investment in a sensible middle of the road fund is better than not investing at all! Invest in something, then monitor and use the time to learn more about what you have bought and how to assess its performance. 

KDF

Thanks for your guidance and I’ve been looking at those items. What would you consider as low charges?

As you say I’m also taking the view better to invest in something e.g. the balanced AJ Bell fund and take advantage of the tax efficiencies than not invest at all and over time I’ll see some returns. I must learn not to keep checking the AJ Bell app daily!😄 However once you open Pandora’s box and start thinking about retiring it seems to absorb far too much thinking time!

Juno_Moneta

There are so many things you can invest in…

Do lots of research before you take the plunge… the market is always there - take your time…

Investment trusts, ETFs, individual equities…

And people will tell you to diversify, which is generally good advice - but you can end of overdoing it so you’re only matching an average index return anyway.

My mantra: Concentration builds wealth and then diversification protects it.

So choose your first investments wisely - then do nothing - over trading can increase costs like stamp duty and damage your returns. If you’re in your fifties consider investing for a decade more and you should do ok!

Good luck. (You will need it!)

artyboy

KDF said:

Marcon said:

KDF said:

Hi
I’ve recently opened a SIPP to supplement my deferred DB scheme and a small employer pension as I’m an umbrella contractor.

I’d be interested to know how others select funds to invest in. I’ve gained lots of useful advice from this board including some of the long running threads (Sea_shell) and the more recent one on Taking a Bold Leap.

I’ve selected three different investments so far but would be interested in others views (Global / Vanguard 80% equity and a Balanced fund from my SIPP provider, AJ Bell. Thanks

What's your attitude to risk?

Moderate, I would say, as a higher rate tax payer, I’m aware the combination of tax savings and NI savings as I’m using salary sacrifice mean my SIPP balance has only ‘cost’ me approx. 50% of it’s value. That said I want to see the value grow and as I’m in my early 50s need to factor that in 

Interesting you quote your age as a factor for
risk tolerance. Given you are in your early 50s (a great vintage as I can attest to  ) then when do you see yourself actually wanting/needing to withdraw from this pension? In my case I expect/hope that I will have another 30+ years ahead of me, and for that reason, I will remain fully invested in global equity trackers, with a degree of shift towards MMFs as and when I may start taking an income.