S&S over fixed isa?

Dave05

Hi 

Ive Been looking into s&s and wondering what sort of returns (%) have you experienced? Obviously no one can predict the future so there's  loses as much as returns but im just interested as to what roughly people have experienced. I am looking to invest for a minimum of 5 years, if not more, i have 20k to place in one this year (drip feed or one off transaction still to be decided? ) the other option is a fixed isa which are sitting around 4.5%, obviously you know what your getting and it's garenteed but that's what it will remain at. 

I am very new to s&s so i was thinking 'robo investing' i know it comes with a fee and it's limited but i thought maybe the best this route whilst i do some further research? I have been looking at wealthify, T212 and invest engine (invest engine lower fees but not been around long) if anyone has any experience with these and with robo investing id like to hear your stories  

Thankyou for your time 

Kind regards 

Dave 

masonic

Over almost 20 years, my returns have been 8.5% per year, while over that period cash (as measured by 1 year fixed rates, has averaged about 3.75%). That's for a portfolio that has been on average 75% equities (but has ranged from 60-100% at different times). That obviously isn't a guide to the future.

S&S and cash serve different purposes. S&S is more suitable for the long term, while cash is useful for money you need to access in the short term and risks loss of value due to inflation over the long term. Five years is really an absolute minimum for investing, ideally you'd be investing over more than a decade to reduce the risk of suffering a loss to a negligible level.

As well as robo-investing, there is also the option of holding a multi-asset fund, which could work out cheaper. Essentially the fund manager does what the robo-service does, but you would have to choose your level of risk initially.

See for example https://monevator.com/passive-fund-of-funds-the-rivals/

Dave05

masonic said:

Over almost 20 years, my returns have been 8.5% per year, while over that period cash (as measured by 1 year fixed rates, has averaged about 3.75%). That's for a portfolio that has been on average 75% equities (but has ranged from 60-100% at different times). That obviously isn't a guide to the future.

S&S and cash serve different purposes. S&S is more suitable for the long term, while cash is useful for money you need to access in the short term and risks loss of value due to inflation over the long term. Five years is really an absolute minimum for investing, ideally you'd be investing over more than a decade to reduce the risk of suffering a loss to a negligible level.

As well as robo-investing, there is also the option of holding a multi-asset fund, which could work out cheaper. Essentially the fund manager does what the robo-service does, but you would have to choose your level of risk initially.

See for example https://monevator.com/passive-fund-of-funds-the-rivals/

Hi 
Thankyou very much for responding much appreciated 

Quite clear them s&s is better BUT of course that can and does change but it's the gamble people take

With regards to a multi asset fund is that for example when you see the options of picking 1-5 ie 1 being the lowest and 5 the highest then depending on what number depends where your money is spread as the other option ive seen is you are asked about 6 risk questions and it chooses a risk level for you 

masonic

Dave05 said:

With regards to a multi asset fund is that for example when you see the options of picking 1-5 ie 1 being the lowest and 5 the highest then depending on what number depends where your money is spread as the other option ive seen is you are asked about 6 risk questions and it chooses a risk level for you 

Yes, that is correct. There is nothing to stop you using such a questionnaire from one provider and using the result to pick an investment elsewhere.

Albermarle

For investing for the longer term/retirement - a pension is usually the best way, due to the tax advantages.
Do you have a workplace pension? Are you public or private sector or self employed ?

Dave05

masonic said:

Dave05 said:

With regards to a multi asset fund is that for example when you see the options of picking 1-5 ie 1 being the lowest and 5 the highest then depending on what number depends where your money is spread as the other option ive seen is you are asked about 6 risk questions and it chooses a risk level for you 

Yes, that is correct. There is nothing to stop you using such a questionnaire from one provider and using the result to pick an investment elsewhere.

Thanks masonic, my next decision is do i invest full amount into isa this year or drip feed upto the 20k

Dave05

Albermarle said:

For investing for the longer term/retirement - a pension is usually the best way, due to the tax advantages.
Do you have a workplace pension? Are you public or private sector or self employed ?

Hi thanks for reply 

My works pension is currently to the max as i have a good works one so now looking to invest elsewhere  

eskbanker

Dave05 said:

masonic said:

Dave05 said:

With regards to a multi asset fund is that for example when you see the options of picking 1-5 ie 1 being the lowest and 5 the highest then depending on what number depends where your money is spread as the other option ive seen is you are asked about 6 risk questions and it chooses a risk level for you 

Yes, that is correct. There is nothing to stop you using such a questionnaire from one provider and using the result to pick an investment elsewhere.

Thanks masonic, my next decision is do i invest full amount into isa this year or drip feed upto the 20k

Lump sum beats drip-feeding on average, as summarised by the old investing adage of 'time in the market not timing the market'.

Eyeful

Dave05
This may be of interest to you

Alexland

Dave05 said:

I am looking to invest for a minimum of 5 years, if not more

5 years is such a short amount of time when an economic cycle might last a decade. You might get the best period (unlikely given where starting valuations for equities are now) or the cruddy period where everything goes wrong and starts to recover (seems more likely from here, but who knows).

On a 5 year outlook then a cash account or money market fund providing similar return would be my choice.

If investing in anything more risky with that timescale then look for a mid-risk level robo portfolio or a balanced multi asset fund something like 60% equities and 40% bonds to balance out the risk and give yourself some options to increase equities exposure if the market does turn south for a few years.

Dave05

Eyeful said:

Dave05
This may be of interest to you

Hi did u send something as theres nothing attached to your message Alexland said:

Dave05 said:

I am looking to invest for a minimum of 5 years, if not more

5 years is such a short amount of time when an economic cycle might last a decade. You might get the best period (unlikely given where starting valuations for equities are now) or the cruddy period where everything goes wrong and starts to recover (seems more likely from here, but who knows).

On a 5 year outlook then a cash account or money market fund providing similar return would be my choice.

If investing in anything more risky with that timescale then look for a mid-risk level robo portfolio or a balanced multi asset fund something like 60% equities and 40% bonds to balance out the risk and give yourself some options to increase equities exposure if the market does turn south for a few years.

Hi tbh 5 years was just a minimum I'd probally end up leaving it for another 5. Do you think this is a bad time to invest in s&s then? 

With regards to risk i was looking at the wealthify tentative/confident, not sure if this is a good place to start 

The other was the invest engine 5 i think it was, im not totally clued up yet but the wealthify seemed to have a good mix of investments where as invest engine had a lot of 'Xtrackers' if anyone can shed some light on those