Vanguard Life Strategy
Comments
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Hi all. I'm looking to invest in the VLS60 with a small lump sum (maybe £5k). I've already maxed out my ISA this year but would it be easy to move that investment into a S&S ISA next year and then drip feed a monthly amount on top? It's my first time investing so I'm still getting my head round a lot of things. Thank you.0
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You can't literally move a fund into an ISA because ISA subscriptions must be made in cash. So what you have to do is put cash into the S&S ISA and then use the cash inside your new ISA to buy the fund again, now inside the ISA 'wrapper'.Hi all. I'm looking to invest in the VLS60 with a small lump sum (maybe £5k). I've already maxed out my ISA this year but would it be easy to move that investment into a S&S ISA next year and then drip feed a monthly amount on top? It's my first time investing so I'm still getting my head round a lot of things. Thank you.
Some providers advertise a process called 'Bed and ISA' which is an idiom that doesn't make a lot of sense to someone who hasn't already heard the term 'Bed and Breakfasting' in relation to shares. The latter involves selling your shares one night and buying them back again the next day. While Bed and ISA means selling the shares outside the ISA, and having the fund platform manager put the resulting cash into your ISA account and then buying again inside the ISA.
Some providers that don't particularly advertise 'Bed and ISA' will still do it for you if you ask. Or you can just do it manually by selling from your 'unwrapped' account and then once you've got the money, using that money to make a cash subscription into your ISA account with the proceeds, The problem with doing it manually is that you can be 'out of the market' for a little while waiting for the cash to clear and then for your new subscription order to clear. The market might go up or down a bit while you are waiting. Still, with your amount of money (£5k), a movement of a whole percent up or down is only £50 and is almost just as likely to be in your favour as against you.
With a sum starting off at £5k initially, your cheapest solution for the ISA would be to open an account with https://www.vanguardinvestor.co.uk/what-we-offer/fees. They only charge 0.15% of your asset value as an annual platform/administration fee which on £5k is only £7.50 with no chargest to buy or sell shares in the fund. It's up to you whether you transfer your existing holdings into a General Account with them first and ask them to get it into an ISA Account for you, or just sell the fund with your current provider and then use the resulting cash to subscribe to an ISA account with Vanguardinvestor.co.uk and re-buy the fund of your choice.0 -
I have a VLS fund in there. The 100. The pot wont be touched for very likely another 30 years, maybe a bit more if i'm unlucky enough but certainly 30.
Though as i work through Tim Hale's book i start to wonder whether this is too high & the 'wrong answer' for me. I know that it'll be hit by big lows when it falls, compared to say the vls 40, 60 etc and say i could have £30k in there, lose 40% & be sat at £18,000 but my thinking is that i've 30 years at this which should be time enough to recover.
Obviously as i get to being 25, 26, 27 years in to that 30 years i'm not going to sit there still on VLS100 because i'd only have 5, 4, 3 etc years to recover so it'd be too risky for me at that point.
But as i sit right now with 30 years minimum ahead of me i think that should be plenty time to recover from any hit.
Though as i said, reading the book makes me doubt myself. I'm far from the most knowledgable on this so i often wonder if i've done 'the right thing'.0 -
JustAnotherSaver wrote: »Though as i work through Tim Hale's book i start to wonder whether this is too high & the 'wrong answer' for me. I know that it'll be hit by big lows when it falls, compared to say the vls 40, 60 etc and say i could have £30k in there, lose 40% & be sat at £18,000 but my thinking is that i've 30 years at this which should be time enough to recover.
No one can tell you what to do, but if it was me (and it sort of is me as I hold various Vanguard funds, including LS100), I would leave it. The idea is that the 100 will make more in good times compared to say LS60, to compensate for the bigger drops in bad times. In other words, the LS60 might drop less than the 100 but would be worth a lot less to start with.
If there's a crash, the best thing to do could be to buy more LS100 while it's cheap."I don't mind if a chap talks rot. But I really must draw the line at utter rot." - PG Wodehouse0 -
What are you going to do in 30 years time that means you won't have time to recover?JustAnotherSaver wrote: »Obviously as i get to being 25, 26, 27 years in to that 30 years i'm not going to sit there still on VLS100 because i'd only have 5, 4, 3 etc years to recover so it'd be too risky for me at that point.
When I reached that point (aged 58), I merely changed my investments to good income payers, remained fully invested and lived off the income.
Note that whether the stock market was up or down made little difference, as both what was sold and what was bought were up (or down).Eco Miser
Saving money for well over half a century0 -
'When I reached that point (aged 58), I merely changed my investments to good income payers, remained fully invested and lived off the income'
This is of particular interest to me - could you elaborate.....?0 -
This is of particular interest to me - could you elaborate.....?
I'm not the OP but I have just ordered a copy of this.
"Living Off Your Money: The Modern Mechanics of Investing During Retirement with Stocks and Bonds"
https://www.amazon.co.uk/gp/product/0997403403/ref=oh_aui_detailpage_o04_s00?ie=UTF8&psc=1I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
gadgetmind wrote: »I'm not the OP but I have just ordered a copy of this.
"Living Off Your Money: The Modern Mechanics of Investing During Retirement with Stocks and Bonds"
https://www.amazon.co.uk/gp/product/0997403403/ref=oh_aui_detailpage_o04_s00?ie=UTF8&psc=1
You bought it:eek:
That's not very MSE. Is there no library near you gadgetmind?:p0 -
'When I reached that point (aged 58), I merely changed my investments to good income payers, remained fully invested and lived off the income'
This is of particular interest to me - could you elaborate.....?
I read, in particular, the Greybeard articles on Monevator and after due consideration, and investigating other possibilities, invested in a selection of ITs and REITs, as well as keeping my existing Vanguard units for some growth.
I thought I might have to sell some units to make up any shortfall in income, but so far that's not been necessary.
NB what was appropriate for me then may not be appropriate for you now.Eco Miser
Saving money for well over half a century0
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