📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

S & P 500 investment in wive's name

Options
245

Comments

  • Investment is a new field to us, any advice welcome.

    Does that mean that you both either have Defined Benefit pensions ( mainly only available to public sector employees nowadays) or no pensions at all?

    The reason for the question is that within  most workplace pensions and all personal pensions, the money is normally held within investments.
    Thanks, we are both in defined contribution scheme through our respective employers and private sector.
    Nothing is more damaging to the adventurous spirit within a man than a secure future. - Alex Supertramp
  • Roger175 said:
    Hello All, 

    Husband - higher tax bracket
    Wife - basic rate tax bracket

    We have a little savings which we want to put in an investment, I am thinking of S&P 500 index via Vanguard. I was wondering if it is more tax efficient to open an investment account in wive's name or a joint account.

    Not concerned about other risks like splitting up etc. at this stage.

    Investment is a new field to us, any advice welcome.

    Thanks in advance.
    Yes, don't put everything into something which is arguably at it's peak. You should be diversifying and only putting a given percentage into the S&P.

    In the last couple of months, I've sold about 2/3rds of my S&P funds and global funds which I feel are too heavily weighted towards the S&P. I maybe wrong, but having recently retired I'm not prepared to take the sequence of returns risk which would result from a US crash/correction. In my view the gains over the last year or two are unsustainable, but do your own research. 
    This is excellent advice, I had not considered the peak argument. I am not looking to invest anymore than £5K (starting point) and hence spreading didn't occur to me.
    Nothing is more damaging to the adventurous spirit within a man than a secure future. - Alex Supertramp
  • dunstonh
    dunstonh Posts: 119,764 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    incus432 said:
    When you see 'S&P 500' everywhere in posts from new investors it's a warning sign.  The new dotcom boom. 
    And most of them don't realise that they are not getting the same returns on the S&P500 that an American would get.
    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.
  • dunstonh said:
     I am thinking of S&P 500 index via Vanguard.
    OK, that fills the US allocation but what about the rest of the world?

    Or are you mistakenly looking at short term recent returns and making a bad investment selection on that basis?


    I have set aside 5k to invest and returns on rest of the world didn't seem any better than ISAs or early payments on mortgage, S&P returns in particular stood out and couple of my friends who invested last year highly recommended it.
    Nothing is more damaging to the adventurous spirit within a man than a secure future. - Alex Supertramp
  • Hoenir
    Hoenir Posts: 7,742 Forumite
    1,000 Posts First Anniversary Name Dropper
    edited 24 December 2024 at 10:30PM
    dunstonh said:
     I am thinking of S&P 500 index via Vanguard.
    OK, that fills the US allocation but what about the rest of the world?

    Or are you mistakenly looking at short term recent returns and making a bad investment selection on that basis?


    I have set aside 5k to invest and returns on rest of the world didn't seem any better than ISAs or early payments on mortgage, S&P returns in particular stood out and couple of my friends who invested last year highly recommended it.
    If returns were entirely predictable there'd no risk premium on holding equities nor would anybody pay their mortages off. How much would your portfolio have to drop in value before you felt uncomfortable. A 10% fall would amount to  £500 fo example. Ideally you need to decide upon your personal tolerance for risk before deciding where to invest. 
  • AlanP_2
    AlanP_2 Posts: 3,520 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    edited 24 December 2024 at 10:35PM
    What are your DC pensions invested in?

    You might already be 100% S&P500. Unlikely but if you haven't looked how do you know. 

    Advice from friends is OK but their timescales and objectives might not be the same as yours, nor their tax / debt / pension etc. etc.

    What do you want from the investment over how long? A couple in their 30s with 3 young children will have different priorities to a childless couple in their 50s.

    If it is for retirement then use a pension wrapper or an ISA wrapper if for pre or early retirement.

    Investing is no different to other activities - decide what you are trying to get out of it and then choose how to get there. 
  • I was honestly thinking this will be a simple decision and expecting the responses to be something like ...S&P 500..great choice go for it. 

    But I have now got a lot more food for thought and I can see a number of important concerns mentioned here which didn't even cross my mind.

    I am now considering using the money set aside for investment to 

    - contribute towards wife's pension
    - make even more early payments on mortgage

    Thank you very much for your responses.


    Nothing is more damaging to the adventurous spirit within a man than a secure future. - Alex Supertramp
  • HHarry
    HHarry Posts: 990 Forumite
    Part of the Furniture 500 Posts Name Dropper
    Setting aside which funds might be most appropriate, if you have £5k ISA allowance left this year then use that for your investment.  You won’t have to worry about tax efficiency as everything is sheltered from tax. I don’t think you can have a joint ISA, and it makes no difference who’s name it’s in.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351.1K Banking & Borrowing
  • 253.2K Reduce Debt & Boost Income
  • 453.7K Spending & Discounts
  • 244.1K Work, Benefits & Business
  • 599.2K Mortgages, Homes & Bills
  • 177K Life & Family
  • 257.5K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.