5-10 Year Recommendation

magd36

What are people's recommendations for a provider and fund for a S&S ISA that has low fees and only needs to try and match inflation over a 5-10 Yr Period. Thanks

leoluka

For something steady that just keeps up with inflation, a global index tracker is usually a good bet — like a Vanguard LifeStrategy 40 or HSBC Global Strategy Balanced fund. Both have low fees and are easy to hold in an S&S ISA with providers like Vanguard, AJ Bell, or Fidelity.

Albermarle

leoluka said:

For something steady that just keeps up with inflation, a global index tracker is usually a good bet — like a Vanguard LifeStrategy 40 or HSBC Global Strategy Balanced fund. Both have low fees and are easy to hold in an S&S ISA with providers like Vanguard, AJ Bell, or Fidelity.

The funds you mention are not global index trackers( which are 100% equity normally)
They are multi asset funds as they comprise equity and bonds. 
Having said that, they are good suggestions for what the OP is asking.
However with a Vanguard S&S ISA, you can only hold Vanguard funds, so not the HSBC one. 

OP - You will realise of course nothing is guaranteed with investing, but the longer you hold investments the better. So 10 years would be better than 5 year. 

SVaz

Index linked Gilts hold their value as long as they are held to maturity. 

magd36

leoluka said:

For something steady that just keeps up with inflation, a global index tracker is usually a good bet — like a Vanguard LifeStrategy 40 or HSBC Global Strategy Balanced fund. Both have low fees and are easy to hold in an S&S ISA with providers like Vanguard, AJ Bell, or Fidelity.

Thanks. A related question, if I was to invest £20k, would people drip feed £5k every 6 months over 2 years (the remaining being held in a high interest cash account) or just go £20k in one lump.

SVaz

If a big drop would worry you then maybe £2k a month x 10, then if there is a drop early on you will be buying funds at a cheaper price. 

If all you want is to keep pace,  why are you risking investing?
A mixed asset fund with low equities might not keep up with inflation over 5 years.
As I said before,  an index linked Gilt will keep it’s true value over whichever term you choose. 

poseidon1

SVaz said:

If a big drop would worry you then maybe £2k a month x 10, then if there is a drop early on you will be buying funds at a cheaper price. 

If all you want is to keep pace,  why are you risking investing?
A mixed asset fund with low equities might not keep up with inflation over 5 years.
As I said before,  an index linked Gilt will keep it’s true value over whichever term you choose. 

I would suggest that index linked gilts are at the complex end of fixed income investing. Therefore unsuitable for newbie investors without professional advice from a stockbroker or other suitably qualified wealth managers . 

I certainly would not be looking at index link gilts if I only had a modest  £20k to invest over the OP's time horizons and very much doubt any wealth manager would want to advise on such a small amount.

Sam_666

If you only want to match inflation, stick to savings accounts only.
Waste of time in my opinion, when you could be making 15% per year on S&P. Pesnion is even better option, but you didnt mention age or existing plan.

InvesterJones

Sam_666 said:

If you only want to match inflation, stick to savings accounts only.
Waste of time in my opinion, when you could be making 15% per year on S&P.

If the OP's goals are met by them only needing to match inflation, why would you recommend they take on more risk? 

Albermarle

Sam_666 said:

If you only want to match inflation, stick to savings accounts only.
Waste of time in my opinion, when you could be making 15% per year on S&P. Pesnion is even better option, but you didnt mention age or existing plan.

Remember many people are scared of investing, or at least mildly nervous.
So going head first into a highly concentrated index tracker, that could drop precipitously at any moment,  is not for most people.

El_Torro

InvesterJones said:

Sam_666 said:

If you only want to match inflation, stick to savings accounts only.
Waste of time in my opinion, when you could be making 15% per year on S&P.

If the OP's goals are met by them only needing to match inflation, why would you recommend they take on more risk? 

Agreed. A couple of other points:

Suggesting that the S&P 500 will return 15% a year over the next 5 to 10 years is being a bit optimistic. 

Savings accounts are also unlikely to match or beat inflation over the same time period.