So how was that (financial) year for you?

I can have zero lump sum now and £3660 a year, or any lump sum I choose and they will recalculate the monthly pension. I can defer taking anything at all for up to age 78. I doubt if I will live past 70, though, so that is what made me take the highest lump sum now and smaller monthly income because I don't need it to live on.

If you have restricted life expectancy it can make a lot of sense to go with more cash in your hand (the £13500?) and less ongoing per annum. However, the average life expectancy for a female in the UK who has already reached age 60, is close to 88 years old - i.e. 28 years from now rather than 10.

That's an average and there are regional and demographic variations. If you were in poor health and drank or smoke more than average, you wouldn't have so long on the clock. But you did mention in your IFA thread in Nov '16 that you were in good health, and in this thread that you don't drink or smoke. Maybe the Nov 2016 thread was before your accident. Still, if you are in no worse than average physical shape for a 60-y/o lady, it wouldn't be at all surprising to see you get to 95+; maybe a 1 in 4 chance of that and 1 in 10 chance of having a birthday card from the Queen.

But you probably know your health better than we do. The point is just, (especially when you don't know much about how to invest it when you get it), a higher monthly amount - or deferring the pension and getting more - can be a good insurance policy against living much longer than ten more years from now.

If your health is such that seeing out 10 or more years will be a big surprise, perhaps there is scope to ask the pension fund to offer an enhanced amount because they budgeted for you to be around until your mid 80s or beyond and actually you'll be leaving much sooner...

1. My stocks and shares are spread across something like 17 funds which themselves are spread across a range of funds. So I am probably invested in something like 70 or 80 different funds. My ex told me this is the "right way" to do it.

If the overall average blend of assets ends up within your risk tolerance then yes diversification is a good way to go (though you certainly don't need as many as 17 funds holding other funds). However if all the 17 funds are high risk ones, you are still overall, sitting there with a risky set of Investments. The fact that you got on average 17% on your funds and 13% on his funds means they are not low or medium risk funds because the average of 17 medium risk funds would be unlikely to be be as high as 15% or more from last April to April.

They aren't all likely to plummet at the same time unless there is a world recession.

Probably true. So what about when there is a world recession, and they do? Are you ok with the losses you would get from a diversified set of equity funds in those circumstances? There may be one in a few years time or one starting next week. If you live long enough beyond 70, you might see more than one.

2. If I withdraw ALL of my 140k from HL now, I will be turning that 15% "paper" gain into a "real" gain, and no money will be lost when this massive crash comes along to wipe out half my capital. (I say 140k because presumably I should leave the 15k that is in the SIPP.) Then comes the question, where to put it that is cast-iron. And that is where the IFA comes in, I suppose, or is there a ready answer to where to put 140k?

There is no ready answer where to put £140k because investment is about opinion, attitude, goals, risk capacity and levels of knowledge and understanding that a person has.

So the solution used would be different for everyone. But don't make the misconception that because investment can involve different opinions, maybe that means they're all just as good as each other and all valid. That there's no right or wrong and it doesn't matter what you do even if you pull fund names or of a hat. Because no, the opinions aren't all going to be equally as good for you. Some opinions and strategies are stupid ones. Some are great for some people but wouldn't work for others. An IFA will have experience of how to work with lots of different customers including people like you.

If you sit down with two or three local IFAs you can decide who you'd prefer to work with and what the costs might be - but they will all have a similar sort of professional approach to end up at an appropriate solution, even if the solutions differ. You can certainly afford to buy advice, as you could have afforded it a year or two ago when you had £100k of capital that you didn't need immediately; and now you have £155k.

You don't need to sell all your HL assets if you are going to take advice soon. Certainly don't empty the S&S Isa and sipp as it will be a waste of your allowances when you then get advised to top them back up again. If you do make some sales, just keep the money in cash on the HL platform until you have been advised what to buy. Your adviser will no doubt have a preferred platform that's cheaper than HL for £100-150k of fund investments.

bundly wrote: »

Thanks for going to all the trouble of a very long response Bowlhead, though it's weird when someone does that then gets out the knife at the end.

My final point was in hope that you would try to moderate your attitude a little and think twice before you shut out the well-meaning strangers from your life by exhibiting paranoia and accusing them of something of which they're not guilty, and trying to get them banned from exchanging their views on this thread. It was a well meaning comment as I wish you the best.

Instead, you took that to be "getting a knife out" at you. You said you were going to delete that sentence from your records. Lungboy commented that it was a valuable piece of advice. Ironically you then turned on him for saying that (ie for reiterating that you shouldn't cut your nose off to spite your face, or throw the baby out with the bathwater) and said that single sentence of his was attacking or harassing you. Now his post no longer appears on the thread and neither does Dairy Queen's, whom you said you believed to be jealous of you.

Either you reported them and a moderator removed their posts, or they removed their own post for a quiet life. But either way you can guarantee that's a couple of people who will have no further interest in helping you. Together with the others you criticized on the other short lived thread which you deleted and was reported.

Your problem is that Lungboy was merely passing comment on the posts being made on a thread where people are trying to help you. If you continue to report such fellow users, for their well-meaning and tame comments - maybe you will weed out a joker or two. But it will be counterproductive overall, because you will cut out any hope of getting further help from them and from many more people than that who think you are not being very gracious. And you need the help you can get.

bundly wrote: »

However, when a poster does what Lungboy did, he deserves to be reported. He came onto the thread and made a short post purely to say something nasty to a woman who is a stranger to him and has never done him any harm. There was no other content to his post.

I don't want to waste your time or mine on this as bickering gets us nowhere. However, I would like to give you my opinion on that. He didn't "just come onto the thread and make a short post purely to say something nasty to a woman who is a stranger".

He was already participating in the thread with two other posts - one to comment that my earlier posting was not "mean spirited" as it had been well intentioned; and a second to make the observation that the two Japan funds you mentioned had particularly high "FE Risk Scores" and only one of them was on the HL marketing list that you'd regarded as having good risk/volatility characteristics. So, he didn't pop up out of nowhere.

I had ended my long post which you were copying for posterity, with a reply to your comment that you didn't need your ex because you had all us lot. I observed you wouldn't keep all us lot onside if you were going to keep reporting people for their views, as people would be less willing to help; you may alienate the otherwise-concerned strangers. You said you would save my message but disregard that bit because you didn't like it. Lungboy made a one sentence post to say that if you deleted that bit, you were perhaps deleting the most important part of the message. In other words: don't push people away, because the kindness of strangers can enhance your life.

To that honest and useful comment, you said "stop harassing me ; stop attacking me" and then you reported it.

Clearly the Moderator also felt that the post contributed nothing to the thread other than unpleasantness

The moderators want to keep the peace, and be seen to crusade against cyber bullying, so when they are alerted to a post where a forum user is telling another to stop harassing and attacking them, they will not sit back and read several pages of thread for context to determine whether you were actually getting attacked. The easy option on a forum this size is to take things at face value. The end result was that you achieved your aim of having the post and its advice, removed. You can't infer from that that anyone believed you were being harassed and attacked by someone who simply commented "don't discard the best advice offered to you".

Anyway. Moving on.

I have a question about a fund within my HL account. Baillie Gifford Japanese Smaller Companies Class B - Accumulation (GBP). I invested £26,368 and it's now worth £34,648, an increase of £8,280. The percentage increase was 31.40%; and Legg Mason IF Japan Equity Class X - Accumulation (GBP) bought at £5,658 now worth £7,854 (38.82%). Does the high percentages mean I should sell these shares now and "realise" that £10k increase, because that fund will probably start to drop in % now, after having had a good year?

A traditional approach would be to build a balanced portfolio of funds covering a wide variety of sectors. At the start you might have x% in fund 1 and y% in fund 2 and z% in fund 3 and a% in fund 4 and b% in fund 5, and so on, and together the whole lot adds up to your whole portfolio.

From time to time, some will go up, others will go down, or some will go up and others will go even more up.

What might happen, as in this example, is that you start off with a "certain proportion" of your portfolio, say x%, allocated to some funds and then they grow faster than other things, so when you look at your portfolio later they are more more than x% of the revised portfolio value. But you only wanted x% in these funds, to allow room in your portfolio for all the other funds which are not Japanese high risk equity. That doesn't mean you need to completely sell out of them, but you should trim back the amount invested to the proportion of your portfolio that it was before (if you still believe that is a sensible number) -which is how much of the portfolio you want to risk in these funds at a point in time.

For example if these two funds were together once worth 20% of your portfolio but now they are 25%, you probably need to cut them back because you don't want a quarter of your money in this one basket. So sell part of them and put the resulting money into something else so that you become, once again, no more than 20% allocated to these funds.

The above is a generalisation. Frankly, having over £40k of a £160k portfolio in two specialist high risk Japan funds is a bit of a crazy high risk, given Japan is less than 10% of the world economy by market size and these two funds focus on a very small part of that economy at a time. As shown in the graph in the previous post, the Legg Mason fund could lose a hugely significant fraction of its value in any one year, and for you also to have a big tilt to the BG fund at the same time (specialising in small Japanese companies) is sort of asking for trouble really.

If I were you, and had the attitude "I hate risk", which I'd previously thought, I might sell out entirely. If I'd softened the attitude a bit and didn't mind accepting *some* risk - I would still sell those two funds down to far less than £20k or £30k or £40k- no more than about 5% of your investment between them (£10k or less, on a £165k overall portfolio value) so that you have space for funds that hold company shares in all the other countries of the world too, as well as buying funds that don't invest in company shares and instead hold things like bonds, commercial property etc.

bundly wrote: »

I've never heard of the "VLS 100 acc" and so this is another benefit to this board: hearing of new things!

Edited to add: I googled it and it took me straight to HL, where I see it's a find similar to the ones I have. I suppose the very low interest rate is made up for by it being a "cast iron" fund?

It doesn't pay any interest as it is not a cash account and doesn't loan money to companies or governments so it doesn't earn any interest from its investments.

Instead of interest it pays a relatively low level of dividend income. Dividend income represents the profit shares it periodically receives in cash from 5000 companies around the world in which it invests. Actually in this very specific version of the fund, it doesn't physically pay this cash out to you as an investor, because the version you are talking about is an "Acc" (accumulation) version, instead of an "Inc" version paying out the income. So, instead it collects (accumulates) the dividends internally and reinvests them for you, so the shares of the fund become more valuable.

The nature of the fund (accumulating rather than paying an income) is same as your Legg Mason IF Japan, but it is not a very similar fund really. Legg Mason has a very active fund manager making big judgements over the course of the year to manage a highly concentrated set of shares in Japan. Vanguard Lifestrategy by contrast has 25% of its money invested into the UK stock markets, allocated mostly to the biggest companies by following the index, and the remaining 75% allocated to indexes of companies in other world regions; US, Japan, Europe, other bits of Asia and emerging markets etc. It follows the indexes and doesn't try to outsmart the other people in the market from week to week by making big judgements. It's judgement is all up front when it decides how much each country should get. Not picking individual companies from week to week.

As the money is spread far and wide into different stock market indexes, you wouldn't expect it to drop more than 40-50% in a world recession or stock market collapse, while still giving you lots of long term upside potential. 40-50% is a huge amount for some people, who would find it way too risky to be their whole portfolio. However, the scale of your potential losses with that sort of thing are much lighter than LeggMason's 80% in a bad year.

Losing £40 of your £100 at Vanguard's fund still leaves you with £60, which is three times as much money that you didn't lose, compared to as if you had lost £80 of your £100 with LeggMason and only had £20 left over.