Investment adjustment - increasing global equity exposure

Sarahspangles

Mr_Benn said:

Hope you dont mind me asking, but I keep seeing people mention having money in a 'Short Term Money Market' , as a safe haven so to speak. . From a quick google, these only seem to pay 4 to 5% pa, which isnt much different to a a Building Society right now.

Do people do it, becuase they have such big sums that even .5% means a lot of money ?

Or are they guessing that interest rates may drop?

Just trying to understand - thank you.

I hold a year’s basic income in a STMM fund in my SIPP. Although it benefits from the tax advantages of the SIPP, you’re right, the actual returns are comparable to interest on a deposit account. I have it because I was aware it is a good idea to derisk investments coming up to retirement. A couple of months ago I was wondering if I’d done the right thing, but I’m glad now that I did.

It’s standard advice for people who are financially secure to have one to three years’ income somewhere easy to access. I also have ‘cash’ in savings/premium bonds and some STMM funds in an ISA. I have two years to fund from these or sale of investments, before my first pension commences. 

Mr_Benn

Thank you guys, that answers my question. 

Cobbler_tone

Is this classed as a STMM, or just bench marking against one? A work placed pension portfolio.

Notepad_Phil

Cobbler_tone said:

Is this classed as a STMM, or just bench marking against one? A work placed pension portfolio.

Well looking at the FUND AIM section it looks to be investing in the kind of things that a STMM fund would invest in. The only thing I might be concerned about is the use of Repos which brings in potential concerns about who the parties are that these Repos are being contracted with; I would hope L&G would only enter into contracts with extremely high quality companies so I'm probably being ultra picky.