Busy Mee's Last Leg

I feel your anguish over what to do for the best. If it helps I've resigned myself to the thinking that whatever I decide is a positive step and whilst it may not be the very best financial decision in the world, it'll be 98% right and 100% right for us in that moment. Then I review and tweak/go again.

At least you have here to note down your thoughts, or search boards for help, and you get wonderful replies like the one of suffolk. And of course the best places for thinking is on a dog walk in the fresh/crisp air!

I might sound as though I very OK with all this investment malarkey but I assure you, I am similarly concerned.

I suppose it came down to the dilemma you have now and a limited time horizon and getting the best I could from our money. I do have cash reserves too, so not all eggs in one basket. I just thought, I have five years for this to sit and grow without us needing it to be there, and unless mortgage freedoms are removed in the budget, we plan to draw down the DC pot that DH has - which is managed by Scottish Widows, not us - between now and State Pension Age. So I read up on good dividend stocks in blue chip companies, best performance funds for the last ten years, and whether they grow through increases in the share value alone, or whether they also pay a decent dividend. This was the basis of my approach along with reading the financial pages and articles.

We have caught a cold on three stocks in DH's ISA - but he is still in overall increase and his range of investments (that I manage) are more risky than mine. I have been considering reducing the risk now he is retired but need to make time to study.

My other ISA is a Fidelity ISA that they manage after I identified I was a low/medium risk appetite and that has grown by about 5+% per year (after fees) since I opened it in about 2010 - I popped £10k in there and have just left it. They moved it to another fund when the original one was underperforming and they decided to close it to avoid reputational damage and further risk as people were leaving (like Woodford, only he had not got the other funds to swap to). It is just under £13.5k now.

You could approach an active manager but who knows if their star performer will lose his touch or leave? A relatively low risk is the tracker funds. You will not get spectacular performance but you will get market-matching growth. If you are content with that, go for it.

You really are doing so well ..Keep up the good work

I hope you don't mind if I correct a couple of things you are saying in this post

savingholmes wrote: »

HI Busy Mee1

I have been investigating investing. The Simple Path to Wealth by JL Collins is a good starter book - if you prefer youtube you can find him on Choose FI & JL Collins.

I am planning to use the sipp route. How I am thinking about it for me is if I invest in an index tracker fund (eg Vanguard but there are others) I can't do worse than the total stock market - that my chosen index fund is tracking - ie I can't lose it all unless there is some kind of apocalyptic event. I am a lower rate tax payer so if I put in £100 [STRIKE]£80[/STRIKE] - I can claim[STRIKE]get[/STRIKE] £20 in tax relief - which is a 20%[STRIKE]25%[/STRIKE] return. If I was a higher tax payer - I would put in £100[STRIKE]£60[/STRIKE] and get £40 tax relief - which is an even higher return [STRIKE]for the £60.[/STRIKE] My portfolio / sipp would have to fall dramatically for me to be worse off than putting it in an ISA. There are lots of youtubes you can watch on the differences in growth you get from putting it in tax deferred compared to an isa growing tax free. This assumes your lifetime allowance does not exceed the limit (or is not projected to do so by your planned retirement date)

On your OH you can put 2880 into his pension every tax year and get the tax relief back (eg via a sipp). He can do this from income. It is illegal to recycle his pension into another pension and when he left his employment last year he would have signed a declaration that he was not going to do this

[STRIKE]You can put upto £40K into your pension gross per year[/STRIKE]This is not right. You can pay in an unlimited amount to your pension but £40,000 is the personal allowance limit on which you can receive tax relief - as a 40% tax payer this is worth £16,000 per tax year if you can pay in the maximum (if you have enough taxable pay) - and if you didn't use up your previous pension allowance over the last 3 years- you can backdate it and put a lump sum in.

I am not an IFA - this is just my understanding of what I've been reading and how it could apply to my situation.

savingholmes wrote: »

Hi Suffolk Lass - you are closer to the pension side of things than me. There are options that can be explored there and more reading / research that can be done.

savingholmes, don't forget that if you have an occupational pension scheme and you elect to put more in to it (pre-tax deductions from pay) your employer will also often contribute more than the amount they do for a standard deduction from pay - so it is well worth exploring with your HR person if that is the case because it increases your return on investment further.

Sadly I have become officially nerdy on the subject of pensions and I don't know all of it (yet...)