What will a financial adviser do for me?
Comments
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I must admit I am liking the sound of the Vanguard LS80. It matches the 8020 mix and as an OEIC rather than an ETF I could just put money in and leave it and not have to worry about reinvesting any proceeds.
Whats with the vanguard 8020 - is it being trolled on this site - every post I read someone mentions it !!!!0 -
Whats with the vanguard 8020 - is it being trolled on this site - every post I read someone mentions it !!!!
It's a cheap and easy "off the shelf" portfolio fund built out of trackers. If you know you want 80% global equities and 20% a bond tracker mix and nothing else, and three quarters of the equities to be international built off cap weighted trackers and one quarter to be the UK All share index, then basically you need go no further; it is cheap and available on most mainstream platforms and has only existed during a bull market so all the charts that you can get look pretty nice.
If you're daunted by researching the world of investments and someone suggests a solution that "if you agree with x, y, and z you need go no further", it is certainly very tempting to start reading around the subject to see whether you can convince yourself with limited research that you do indeed agree that you want x, y, and z. And hey, maybe you give up that reading early because you see lots of other people saying they use it so it must be alright... so maybe you'll sign up too.
So the person does that and buys it as their ISA or personal pension and sticks around on the forum community. The next month a question comes up from someone daunted by investment choices. "Ah, I can help with that", they think, " hey fellow newbie I was in your shoes last month, have a look at VLS range, I was pleasantly surprised how easy it was, apparently it's all you need, it has certainly been fine for me so far".
And then someone else chips in with research that says trackers beat active and mostly global equities is fine if you're going to be invested long term and have some global bond index to take a bit of the edge off huge crashes. And another person says they heard vanguard were cheap and reliable so they bought it too. End of thread, no further discussion needed, boom, another convert.
Not necessarily the best solution for the individual who's been converted, and maybe a really bad one if the investor didn't really want that risk profile - but it saved them hours of research that they didn't feel qualified to do, so they will likely be content with it. Until maybe (for some proportion of the investors) it turns out they should have spent longer learning about investments and considering every option, because they get a really bad result that scares them into selling at a loss.
Basically it has gone viral and is unstoppable, with exponential increases in the number of people who will comment that they have it on any thread that mentions any type of multi asset portfolio in a SIPP or ISA or unwrapped. If it works, why not mention you have it and is working and it was cheap and easy and investing is not so hard after all.
While markets are doing well, vanguard are getting a huge amount of free publicity here. What we really need is a 50-60% equities crash to see whether all the casuals who thought it was best to just follow the herd without doing more than a cursory bit of research, are still happy with it and actually add to it at the bottom of the market collapse... or will they humbly walk off with their tails between their legs realising they have lost a packet and it wasn't too good to be true after all so they'll stop talking about how great it is.
FWIW, it's not at all a bad product and bringing accessible multi asset investing to the masses cheaply is undoubtedly a good thing. But you can't walk into many investment threads without having it rammed down your throat. A bit like high interest current accounts and regular saver accounts for anyone who has a few pounds to save and dares to use premium bonds or cash ISAs
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At the risk of overloading you with even more information, have you seen this website?
https://www.moneyadviceservice.org.uk/en/articles/stocks-and-shares-isas
I've linked to the S&S ISA pages, but it covers many other financial topics in straightforward language.
Please don't go to your local bank for information on investments. They will not be able to give you impartial advice, because they are not allowed to, so they will will only tell you about their own or group products. These are likely to be very expensive:(
Thanks, simple links are always appreciated!0 -
bowlhead99 wrote: »It's a cheap and easy "off the shelf" portfolio fund built out of trackers. If you know you want 80% global equities and 20% a bond tracker mix and nothing else, and three quarters of the equities to be international built off cap weighted trackers and one quarter to be the UK All share index, then basically you need go no further; it is cheap and available on most mainstream platforms and has only existed during a bull market so all the charts that you can get look pretty nice.
If you're daunted by researching the world of investments and someone suggests a solution that "if you agree with x, y, and z you need go no further", it is certainly very tempting to start reading around the subject to see whether you can convince yourself with limited research that you do indeed agree that you want x, y, and z. And hey, maybe you give up that reading early because you see lots of other people saying they use it so it must be alright... so maybe you'll sign up too.
So the person does that and buys it as their ISA or personal pension and sticks around on the forum community. The next month a question comes up from someone daunted by investment choices. "Ah, I can help with that", they think, " hey fellow newbie I was in your shoes last month, have a look at VLS range, I was pleasantly surprised how easy it was, apparently it's all you need, it has certainly been fine for me so far".
And then someone else chips in with research that says trackers beat active and mostly global equities is fine if you're going to be invested long term and have some global bond index to take a bit of the edge off huge crashes. And another person says they heard vanguard were cheap and reliable so they bought it too. End of thread, no further discussion needed, boom, another convert.
Not necessarily the best solution for the individual who's been converted, and maybe a really bad one if the investor didn't really want that risk profile - but it saved them hours of research that they didn't feel qualified to do, so they will likely be content with it. Until maybe (for some proportion of the investors) it turns out they should have spent longer learning about investments and considering every option, because they get a really bad result that scares them into selling at a loss.
Basically it has gone viral and is unstoppable, with exponential increases in the number of people who will comment that they have it on any thread that mentions any type of multi asset portfolio in a SIPP or ISA or unwrapped. If it works, why not mention you have it and is working and it was cheap and easy and investing is not so hard after all.
While markets are doing well, vanguard are getting a huge amount of free publicity here. What we really need is a 50-60% equities crash to see whether all the casuals who thought it was best to just follow the herd without doing more than a cursory bit of research, are still happy with it and actually add to it at the bottom of the market collapse... or will they humbly walk off with their tails between their legs realising they have lost a packet and it wasn't too good to be true after all so they'll stop talking about how great it is.
FWIW, it's not at all a bad product and bringing accessible multi asset investing to the masses cheaply is undoubtedly a good thing. But you can't walk into many investment threads without having it rammed down your throat. A bit like high interest current accounts and regular saver accounts for anyone who has a few pounds to save and dares to use premium bonds or cash ISAs
I hear you. But I know I will get the crashes and I am honestly prepared for the very long haul. I expect another Eurozone crisis, at least, and other states may well end up leaving the EU over the next 10-15 years (Italy, for example). This is a very, very selfish point but I am hoping for a downturn before I buy-in.
On another note if I have only £40k that I want to invest at this stage (rest being kept in cash) then it makes sense to hold whatever funds I buy into in the wrapper of an ISA over two years doesn't it so I'm completely shielded from tax in future?
if so https://www.rplan.co.uk looks interesting. It seems they specialise a bit in funds only S & S ISAs. https://www.rplan.co.uk/home/tour
Or maybe hold £10k in a stocks and shares LISA and £30k in a stocks and shares ISA in case I need cash.
With a S & S LISA is the government's 'top-up' of it via the tax refund automatically invested into the funds held in the LISA? Can I designate how much is invested in each of the funds held in the LISA?0 -
Don't worry - I will take everything he/she says with a grain of salt. I am literally just going to use it as a mining exercise to see how to go about even buying into funds, etc.
People with more financial knowledge than you have walked into banks "just for some information" and walked out having put their money in some god-awful structured product or investment bond. Just saying.
Anyway, it's a complete waste of time. The best case scenario is that you will get some information you could have obtained much more efficiently from the web, an IFA or here. The worst case scenario is that they give you duff or out-of-date information due to poor training and/or their desire to flog junk and then you have to come here to untangle it.
I struggle to think of a less efficient means of gaining knowledge than driving / walking to a bank and talking to a salesman.Whats with the vanguard 8020 - is it being trolled on this site - every post I read someone mentions it !!!!
It's the MSE equivalent of Godwin's Law. As any discussion about savings and investments grows longer, the probability of someone recommending Vanguard Lifestrategy tends to 1. Maybe we could call it Bowlhead's Law ;-)0 -
bowlhead99 wrote: »It's a cheap and easy "off the shelf" portfolio fund built out of trackers. If you know you want 80% global equities and 20% a bond tracker mix and nothing else, and three quarters of the equities to be international built off cap weighted trackers and one quarter to be the UK All share index, then basically you need go no further; it is cheap and available on most mainstream platforms and has only existed during a bull market so all the charts that you can get look pretty nice.
If you're daunted by researching the world of investments and someone suggests a solution that "if you agree with x, y, and z you need go no further", it is certainly very tempting to start reading around the subject to see whether you can convince yourself with limited research that you do indeed agree that you want x, y, and z. And hey, maybe you give up that reading early because you see lots of other people saying they use it so it must be alright... so maybe you'll sign up too.
So the person does that and buys it as their ISA or personal pension and sticks around on the forum community. The next month a question comes up from someone daunted by investment choices. "Ah, I can help with that", they think, " hey fellow newbie I was in your shoes last month, have a look at VLS range, I was pleasantly surprised how easy it was, apparently it's all you need, it has certainly been fine for me so far".
And then someone else chips in with research that says trackers beat active and mostly global equities is fine if you're going to be invested long term and have some global bond index to take a bit of the edge off huge crashes. And another person says they heard vanguard were cheap and reliable so they bought it too. End of thread, no further discussion needed, boom, another convert.
Not necessarily the best solution for the individual who's been converted, and maybe a really bad one if the investor didn't really want that risk profile - but it saved them hours of research that they didn't feel qualified to do, so they will likely be content with it. Until maybe (for some proportion of the investors) it turns out they should have spent longer learning about investments and considering every option, because they get a really bad result that scares them into selling at a loss.
Basically it has gone viral and is unstoppable, with exponential increases in the number of people who will comment that they have it on any thread that mentions any type of multi asset portfolio in a SIPP or ISA or unwrapped. If it works, why not mention you have it and is working and it was cheap and easy and investing is not so hard after all.
While markets are doing well, vanguard are getting a huge amount of free publicity here. What we really need is a 50-60% equities crash to see whether all the casuals who thought it was best to just follow the herd without doing more than a cursory bit of research, are still happy with it and actually add to it at the bottom of the market collapse... or will they humbly walk off with their tails between their legs realising they have lost a packet and it wasn't too good to be true after all so they'll stop talking about how great it is.
FWIW, it's not at all a bad product and bringing accessible multi asset investing to the masses cheaply is undoubtedly a good thing. But you can't walk into many investment threads without having it rammed down your throat. A bit like high interest current accounts and regular saver accounts for anyone who has a few pounds to save and dares to use premium bonds or cash ISAs
Monevator recommend VLS too, in fairness. Not just this site. (That's not say you aren't right about all of the above).0 -
Malthusian wrote: »People with more financial knowledge than you have walked into banks "just for some information" and walked out having put their money in some god-awful structured product or investment bond. Just saying.
Anyway, it's a complete waste of time. The best case scenario is that you will get some information you could have obtained much more efficiently from the web, an IFA or here. The worst case scenario is that they give you duff or out-of-date information due to poor training and/or their desire to flog junk and then you have to come here to untangle it.
I struggle to think of a less efficient means of gaining knowledge than driving / walking to a bank and talking to a salesman.
It's the MSE equivalent of Godwin's Law. As any discussion about savings and investments grows longer, the probability of someone recommending Vanguard Lifestrategy tends to 1. Maybe we could call it Bowlhead's Law ;-)
Cheers, I won't bother then. I'll try to find an IFA, somehow.
I also now think Vanguard LifeStrategy 80: it has nearly 17% in bonds but 14% is in global bonds, not the UK Govt short term and inflation-linked ones which the books recommend. They are in my mix as a defensive/hedging strategy, not a growth provider.0 -
I also now think Vanguard LifeStrategy 80: it has nearly 17% in bonds but 14% is in global bonds, not the UK Govt short term and inflation-linked ones which the books recommend.
Forget what the book says. Fixed interest securities go through cycles and at different points in the cycle, different types will be more favourable (and the volatility levels change with them too which means the split between equities and bonds will be fluid with it). A book is written and published on a given date. It is out of date within 6-12 months.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Yes, plenty of people recommend it. Because it is a decent product and is an option that could be useful for many who wanted a product that does what it does.Monevator recommend VLS too, in fairness. Not just this site. (That's not say you aren't right about all of the above).
On a parallel, Monevator is another example of something that plenty of people here recommend. Because it is a decent blog and is an option that could be useful for many who wanted to be told what it tells people.
I would be happy to say to anyone, take a look at VLS, take a look at Monevator, they are competent offerings. That is of course quite different from saying that VLS x% equities has the best likelihood of a good return for you, or that the general philosophy which Monevator puts forward is one that you must embrace.
Yes - in recent years we have seen changes on dividend tax rates and allowances for example and if you are investing a large chunk of money it makes sense to use the available wrappers that they give you. If you hadn't used your ISA allowance this year, you could do £15k into a S&S ISA before 5 April, £20k into an S&S ISA on 6 April '17, and another £20k on 6 April '18. That would be over £50k entirely protected from tax and available for investment, in the space of only 13 months. Pretty good.
On another note if I have only £40k that I want to invest at this stage (rest being kept in cash) then it makes sense to hold whatever funds I buy into in the wrapper of an ISA over two years doesn't it so I'm completely shielded from tax in future?
Unless you did not want so much investment risk and wanted to have more cash products in which case you might find higher rates for some of that £50k outside ISAs ( I haven't been following your whole thread)
LISA comes with a government top up, but the downside of that top up is a penalty of greater than the top up if you want to take it out for a non-qualifying reason (i.e. you are not buying a qualifying property and you are not age 60+). So having money in a 'normal' S&S ISA, forgoing the bonus, is sensible if you may want earlier access for an emergency or some opportunity which you had not forseen today.Or maybe hold £10k in a stocks and shares LISA and £30k in a stocks and shares ISA in case I need cash.
For example you might decide in ten years time that you wanted to make a large pension contribution and get 40% tax relief as a higher rate tax payer (turning £6000 into £10000 for a 67% 'bonus') rather than having taken the government 25% bonus in the LISA. So using the standard 'non LISA' S&S ISA product with penalty-free access would be quite useful for building towards that objective.
You are not going to be able to get more than £4k (plus bonus) of new contributions into a LISA each year anyway, because of the annual limit.
Yes. The government (via the ISA manager) credits your account. It is up to you to decide what to do with the cash that arrives in your account.With a S & S LISA is the government's 'top-up' of it via the tax refund automatically invested into the funds held in the LISA? Can I designate how much is invested in each of the funds held in the LISA?
In the world of pensions, there are some provider's products where you are making monthly direct debit /standing order contributions into the pension and into underlying funds each month, and then when the pension provider claims the tax relief each month, they automatically invest it into the same funds in the same proportions that you had set up on your fixed monthly allocation of contributions. So, some providers might offer something similar to that, when they get their LISAs up and running and settled down.
However, the admin is easier if they just throw all the claimed government bonus money into a 'cash pot' within your account and then you decide which fund(s) to spend it on. That would certainly be the case in the first year when the first government bonus is not going to be claimed by your provider until after the end of the tax year. The bonus claims will be able to happen in-year during year two onwards, but by that point the customer expectations will probably be that the bonuses will be available to do with as the customer wants, and so most/all managers will probably run the accounts that way.0 -
You say they are not adding to the process. However, that is an incorrect assumption. For example, after charges, our portfolio that matches closest to VLS60 in risk has outperformed VLS60. You should not assume that cheaper is better (or that more expensive will be either)
Some will. Some wont. The term IFA covers many different business models.
IFAs have to be independent. FAs do not.
Hi, If I may ask, how have you structured that portfolio which outperforms VLS60? Would like to know
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