Doing it myself - Current portfolio

downshifted

I’m starting to manage my crystallised SIPP, which is on the Fidelity platform. I’m 70, I have been drawing down £13,500 gross pa keeping my total income (from state pension and DB schemes, just under the 40% tax rate.

My spouse, 74, has old state pension and a small DB pension totalling £12k pa. 

We have combined assets of £150k in Vanguard Life Strategy ISAs 40k in cash ISAs, 50k in premium bonds, and 50k in general savings (some of which is currently being spent on our home).

Our lifestyle is such that in the event of a major crash we could live without drawing down. Hence I am not adverse to risk. I’ve seen significant swings in value in my pot, although not since starting drawdown about 2 years ago, and am comfortable about sitting tight where necessary. But maybe at this stage I could be more conservative? 

I’m here to seek comments please on my current portfolio, the potential for simplification and moving to more trackers and perhaps utilising Gilts. The current valuation is under £500k. All figures are rounded

20 %.   Fidelity multi asset allocator adventurous.         

17%.    Jupiter Merian Asia Pacific
10%.    L&G Multi index fund 7
10%.    Vanguard US Equity Passive index
9%.      L&G global 100 index trust
9%.      Investors UK opportunities z a/c
7%.      Baillie Gifford high yield bond fund B
6%       Jupiter Asian income fund 1 class a/c
5%       Schroeder Global cities Real estate Z
4%.      Man Japan Core Alpha Fund Prof Acc C
3%.      I shares continental Euro equity index class 1 acc

Many thanks in advance for your thoughts
  
                  

coyrls

It's difficult to understand the logic behind your allocations, perhaps you could share your asset allocation model?

downshifted

Thank you for your response. That’s the whole point, the investments were not made by me, they were arranged by my FA who used risk based recommendations from their parent company. I was happy with the level of risk, but as I have now left that advisor am considering how the geographical spread, types of investment etc can be improved and simplified, probably with more trackers

Our Vanguard Lifestyle is 60, so I think that kind of balance going forwards would make sense

coyrls

downshifted said:

Thank you for your response. That’s the whole point, the investments were not made by me, they were arranged by my FA who used risk based recommendations from their parent company. I was happy with the level of risk, but as I have now left that advisor am considering how the geographical spread, types of investment etc can be improved and simplified, probably with more trackers

Our Vanguard Lifestyle is 60, so I think that kind of balance going forwards would make sense

In that case, in your position, I would start again, perhaps with a single multi-asset fund like Vanguard's Life Strategy but others are available.  I wouldn’t go for a lifestyle fund but I think you might have meant Life Strategy, as Vanguard’s lifestyle funds are date managed rather than a fixed equity percentage (like 60).

downshifted

Yes you’re right, it’s Life Strategy, sorry

OldScientist

If you're happy with 60% equities, then a multi asset fund of around that amount (Vanguard is probably the best known, but other fund houses, e.g., Fidelity, HSBC, also do them.

A relatively simple two fund portfolio consisting of a world index tracker (e.g., HSBC All world index) combined with a global bond fund (ishares, vanguard, etc.) would be OK too. Regional biases (including a UK bias) could be introduced by extra index funds at the expense of a small amount of additional complexity.

I also note that you currently have just under 20% of your investable assets in cash (not a problem - so do we), so if aiming for an overall 60/40 split, the remaining portfolio could be around 80/20.

You don't mention whether you have a legacy motive, but I note that you are currently spending under 2% of your portfolio (inc cash) and are therefore likely to leave a large amount unspent.

QrizB

Worth noting that the "Fidelity multi asset allocator adventurous" fund that you've already got 20% in is itself an 80/20 multi asset fund. The simplest way to get to a 60/40 split per OldScientist's suggestion might be to consolidate your SIPP portfolio into that fund.

https://www.fidelity.co.uk/factsheet-data/factsheet/GB00B893BN59-fidelity-multi-ast-allocator-adv-w-acc/portfolio

downshifted

OldScientist said:

You don't mention whether you have a legacy motive, but I note that you are currently spending under 2% of your portfolio (inc cash) and are therefore likely to leave a large amount unspent.

Thank you, that is pretty much in line with my thinking. You are correct in that we were leaving my pot as a tax free inheritance but our thinking may have to change if the new rules come into place and look like staying… I’ll probably start paying 40% tax rather than leaving our daughter to eventually pay more. We’ve already started “giving with warm hands” beyond immediate family within the rules.

tigerspill

OldScientist said:

If you're happy with 60% equities, then a multi asset fund of around that amount (Vanguard is probably the best known, but other fund houses, e.g., Fidelity, HSBC, also do them.

A relatively simple two fund portfolio consisting of a world index tracker (e.g., HSBC All world index) combined with a global bond fund (ishares, vanguard, etc.) would be OK too. Regional biases (including a UK bias) could be introduced by extra index funds at the expense of a small amount of additional complexity.

I also note that you currently have just under 20% of your investable assets in cash (not a problem - so do we), so if aiming for an overall 60/40 split, the remaining portfolio could be around 80/20.

You don't mention whether you have a legacy motive, but I note that you are currently spending under 2% of your portfolio (inc cash) and are therefore likely to leave a large amount unspent.

On regional Bias - the VLS funds I believe has a home (UK) bias already built in (around 25% if I remember correctly).  So not a bad choice if this bias is something the OP wishes to have.

Bostonerimus1

downshifted said:

I’m starting to manage my crystallised SIPP, which is on the Fidelity platform. I’m 70, I have been drawing down £13,500 gross pa keeping my total income (from state pension and DB schemes, just under the 40% tax rate.

My spouse, 74, has old state pension and a small DB pension totalling £12k pa. 

We have combined assets of £150k in Vanguard Life Strategy ISAs 40k in cash ISAs, 50k in premium bonds, and 50k in general savings (some of which is currently being spent on our home).

Our lifestyle is such that in the event of a major crash we could live without drawing down. Hence I am not adverse to risk. I’ve seen significant swings in value in my pot, although not since starting drawdown about 2 years ago, and am comfortable about sitting tight where necessary. But maybe at this stage I could be more conservative? 

I’m here to seek comments please on my current portfolio, the potential for simplification and moving to more trackers and perhaps utilising Gilts. The current valuation is under £500k. All figures are rounded

20 %.   Fidelity multi asset allocator adventurous.         

17%.    Jupiter Merian Asia Pacific
10%.    L&G Multi index fund 7
10%.    Vanguard US Equity Passive index
9%.      L&G global 100 index trust
9%.      Investors UK opportunities z a/c
7%.      Baillie Gifford high yield bond fund B
6%       Jupiter Asian income fund 1 class a/c
5%       Schroeder Global cities Real estate Z
4%.      Man Japan Core Alpha Fund Prof Acc C
3%.      I shares continental Euro equity index class 1 acc

Many thanks in advance for your thoughts
  
                  

Classic "Woolworth's pick and mix" portfolio. Come up with your desired asset allocation and implement it in not more than 5 index funds...or even a single multi-asset fund where the fund managers can worry about rebalancing.

You might want to look into giving to family using the "excess income" rules.

downshifted

You might want to look into giving to family using the "excess income" rules.

Agreed, have done that over the past year, and hope to continue to do so