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Target for Average Pension Pot growth
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Thanks all, sounds like we all just wanna beat inflation. hopefully by 2%+ is ideal. thanks!How do you know its ideal if you haven't mentioned the assets?
If you have greater than 60% equities than inflation plus 2% is viable. However, if you have less than that, then it would not be suitable. e.g. 20% equities should just use inflation. 0% equities should use inflation minus 1% (figures are a guide as opinions vary).
I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
As you have a long way to go, just make sure you are invested in a globally diverse 100% equities fund.
Don't just invest the default amount if you are able. Even just putting in an extra five percent could knock years off of your working life, which you will be very grateful for as you get older!
Then enjoy life and let it take care of itself. It will go up and down, but you are in it for the long game.
I model a 5% return before inflation personally, but when you are so far out it isn't going to give you a very accurate picture. Worth it for motivation though, my pot has tripled in a pretty short space of time, because of gains and me putting a lot more in. Which I still find a bit crazy tbh.Think first of your goal, then make it happen!2 -
Yes the default funds tend to be 25% Equities. So defo need to look at changing this to something a bit more adventurous with higher equities i reckon...!365 Day 1p challenge - £371.49 / 667.95
Emergency Fund £1000 / £1000 ( will enlarge once debts are cleared)
DFW - £TBC0 -
bamgbost said:Yes the default funds tend to be 25% Equities. So defo need to look at changing this to something a bit more adventurous with higher equities i reckon...!I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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bamgbost said:Yes the default funds tend to be 25% Equities. So defo need to look at changing this to something a bit more adventurous with higher equities i reckon...!
As you have a long way to go, just make sure you are invested in a globally diverse 100% equities fund.
This is not bad advice from a rational point of view, but these funds can be very volatile in the short term.
If you are likely to panic and pull out if it dropped 30 % or more, then you would be better with something a bit less racy.0 -
bamgbost said:Yes the default funds tend to be 25% Equities. So defo need to look at changing this to something a bit more adventurous with higher equities i reckon...!And so we beat on, boats against the current, borne back ceaselessly into the past.0
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bamgbost said:Yes the default funds tend to be 25% Equities. So defo need to look at changing this to something a bit more adventurous with higher equities i reckon...!0
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As others have said, there's no right answer. I personally used 4% real for equities pre-retirement and 3.5% for post retirement. The drop doesn't represent any change in asset allocation, just the fact that I could delay my retirement if they underperformed.1
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Triumph13 said:As others have said, there's no right answer. I personally used 4% real for equities pre-retirement and 3.5% for post retirement. The drop doesn't represent any change in asset allocation, just the fact that I could delay my retirement if they underperformed.
For most of my time spent investing for retirement I was hoping for a 6% annual average return (so a few percent above inflation) and had around 60% equities and 40% bonds. Luckily from the early 1990s to 2014 that produced an 8% average annual return and I kept almost all of that as I did not pay an advisor and my funds fees were very low as I used index trackers. That's just one portfolio and one period spent investing, but to beat inflation by a few percent you will almost certainly need the growth potential of a relatively high equity allocation, but there is no guarantee.And so we beat on, boats against the current, borne back ceaselessly into the past.0 -
I had to go double check... and correction its 40% Equities not 25%, even still. The default fund sounds low on equities based on the advise given.
Its an L&G default fund... called. ...L&G PMC Multi-Asset Fund 3. Heres a snapshot of it....
365 Day 1p challenge - £371.49 / 667.95
Emergency Fund £1000 / £1000 ( will enlarge once debts are cleared)
DFW - £TBC0
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