Trying to understand pension changes and feeling out of my depth

DeLaSole

It's important performance of things not meant to be compared are not compared. It's also important fees do not decide the investments. Either alone, or in combination, these things could lead to unsuitable investing. 

Choosing suitable investments is fundamentally what matters, even if they are more expensive in fees or or have a worse historical performance to another asset class. Flitting between considering very different investments and no identification of why an existing investment is unsuitable suggests needing to take a step back to first establish what is actually suitable.

dunstonh

 I sort of wanted a FTSE tracker fund anyway and it being cheaper does tempt me.

Why do you want to be 100% UK equities?   what about all the other countries?

How much is the US index tracker..?

Going 100% into that wouldn't be much better.     What about a global tracker?

Bostonerimus1

NickPoole said:

Let me ponder. I sort of wanted a FTSE tracker fund anyway and it being cheaper does tempt me. Understand that a crash will hit it harder than the Multi Asset fund and also that any recovery might take years!

I don't have to actually do anything except think about it at the moment.

How much is the US index tracker..?

Just take a couple of days to read up on portfolio construction and asset allocation. You need to understand how risk and return should be balanced against the time you plan to be invested and your circumstances, ie still working, approaching retirement or already retired. Here's a starting point...

https://www.bogleheads.org/wiki/Investing_from_the_UK

NickPoole

Bostonerimus1 said:

NickPoole said:

Let me ponder. I sort of wanted a FTSE tracker fund anyway and it being cheaper does tempt me. Understand that a crash will hit it harder than the Multi Asset fund and also that any recovery might take years!

I don't have to actually do anything except think about it at the moment.

How much is the US index tracker..?

Just take a couple of days to read up on portfolio construction and asset allocation. You need to understand how risk and return should be balanced against the time you plan to be invested and your circumstances, ie still working, approaching retirement or already retired. Here's a starting point...

https://www.bogleheads.org/wiki/Investing_from_the_UK

Thank you for that. My AVC makes me a captive L&G customer (which I am happy with) and they have a FTSE tracker, a US tracker and I'll have a look at a global tracker. I am in the original default fund (didn't move to Target Date version see opening to thread!)

From my point of view there are three things I am concerned about:

Cost - I prefer to pay as little as possible!
Risk - I know equities are more volatile (higher risk) and the more local the more volatile
Performance - I'm a captive L&G customer on this one

So if I decide to move to a index tracker I'll be taking a risk but as I have no plans for the investment apart from getting tax free cash out I think I am happy with that. But still thinking about it, as don't really need to take the risk anyway

Got a couple of £20K cash ISAs which are so low risk they might put me to sleep.

I plan to retire in 2026 some time (probably) but won't need the AVC investments then. I suppose not knowing when I will need them is what makes the portfolio construction difficult.

Cobbler_tone

NickPoole said:

Bostonerimus1 said:

NickPoole said:

Let me ponder. I sort of wanted a FTSE tracker fund anyway and it being cheaper does tempt me. Understand that a crash will hit it harder than the Multi Asset fund and also that any recovery might take years!

I don't have to actually do anything except think about it at the moment.

How much is the US index tracker..?

Just take a couple of days to read up on portfolio construction and asset allocation. You need to understand how risk and return should be balanced against the time you plan to be invested and your circumstances, ie still working, approaching retirement or already retired. Here's a starting point...

https://www.bogleheads.org/wiki/Investing_from_the_UK

Cost - I prefer to pay as little as possible!

I don't think that should be a main focus, otherwise stick it in 'cash fund 3' for 0.09%

Albermarle

Cash ISAs are not low risk, they are zero risk.
This makes them suitable for money that might be needed in the short to medium term.

Smudgeismydog

Albermarle said:

Cash ISAs are not low risk, they are zero risk.
This makes them suitable for money that might be needed in the short to medium term.

I wouldn’t completely agree with this statement, as arguably holding cash carries inflation risk, but as noted it can be a useful place to hold money for the short-term.

Albermarle

Smudgeismydog said:

Albermarle said:

Cash ISAs are not low risk, they are zero risk.
This makes them suitable for money that might be needed in the short to medium term.

I wouldn’t completely agree with this statement, as arguably holding cash carries inflation risk, but as noted it can be a useful place to hold money for the short-term.

Good point.

NickPoole

Cobbler_tone said:

NickPoole said:

Bostonerimus1 said:

NickPoole said:

Let me ponder. I sort of wanted a FTSE tracker fund anyway and it being cheaper does tempt me. Understand that a crash will hit it harder than the Multi Asset fund and also that any recovery might take years!

I don't have to actually do anything except think about it at the moment.

How much is the US index tracker..?

Just take a couple of days to read up on portfolio construction and asset allocation. You need to understand how risk and return should be balanced against the time you plan to be invested and your circumstances, ie still working, approaching retirement or already retired. Here's a starting point...

https://www.bogleheads.org/wiki/Investing_from_the_UK

Cost - I prefer to pay as little as possible!

I don't think that should be a main focus, otherwise stick it in 'cash fund 3' for 0.09%

I guess what I am saying is I want as big as gain as possible for as low cost and smallest risk as I can get. Which is obvious. If I switch it will be to a tracker fund but I'd need to be sure I could sit out drastic market corrections that could take several years to recover. If there is a big crash it will also affect the Multi Asset Fund after all. But not the ISAs!

HedgehogRulez

If you want a global equity fund, how about any of these two?