New to Investing..sort of an evolving plan

vivvov · 21 June 2018 at 12:31PM

Hello All

New to the forum. Newish/naive to investment. Aged 53..better late than never I guess.
Thought I'd write in and ask for comment on what I've done so far and advice on what next.

Time line...Mortgage paid off 2010, I hummed and rrred about investing. Investing had, up to this point, only ever been naively 'house first and building society savings'.
However, late to the party, I invested in a FTSE 100 tracker.
Then redirected cash ISA into a Fundsmith ISA in 2015. The basic, solid investment premise appealed.
Attempted to start to get my head round the basics. Figured Iweb would be a cheaper platform in the long term.
Invested in Legg Mason Japan.
Read about passive investing cf active.
Invested in Vanguard Lifestrategy 60/40.

Sold flat for £300k in late 2017

Read up on Investment Trusts cf Passive trackers.
Invested in Scottish Mortgage IT.

Basically missed the last 8/9 year run but, naively looking at market indicators, without any negative stimulus, there might be life left.
...and absolutely out of the blue..turns out my unmarried, working class, very secretive uncle I was close to didn't missed the market. Inherited £300k to now invest. (Never knew!..secretive/close combo)

So as it stands

Invested already.
Equities
£55k: Fundsmith (ISA wrapper)
£44k: Scottish Mortgage (Non ISA)
£20k: Vanguard Lifestrategy 60/40 (ISA)
£11k: Legg Mason Japan (ISA)
£7.5k: FTSE 100 tracker (ISA)

Fixed interest
£20k: Santander 123
£15k: NS & I
£10k: P to P over 3 main companies.
'Daft' stuff
£5k: Whisky (Rare/Limited releases..I've always liked whisky..some folk like StarWars but you can't drink StarWars).
£5k: Couple of '70s Motorbikes (bought at £250 each, way back when).

Approximately £450k to invest.

I realise that I'm going to have to ratchet up the investing in order to not see the monies disappear via inflation and there's talk of potential bear market and trade wars..plus Brexit.

So far I've tried to stick to a plan.
Invest in low fee trackers/ETF's and lower fee Investment Trusts...minimise fees (Fundsmith was early on).
Invest in clear sighted funds that I understand the modus operandi in.
Invest in a diversified portfolio...breaking down the funds, I reckoned on the back of an envelope, gives me approx 40% US/15% UK/15% Euro/7% China/7% Japan...and the Lifestrategy bit.
Be aware of global indices and indicators adjusted for inflation.
Invest in sectors that a green lighted by CAPE etc (that's why Legg Mason Japan happened).and be aware of how each sector looks overtime/at present when adjusted for inflation
Try and invest in ITs with a good track record of beating the average but aren't overvalued (SM IT might be overpriced?..but solid history).
Buy Bonds and fixed interest products to roughly 60/40 split re equities...
Be open and honest to peers' comments in order to progress....that's this bit.

I was going to invest in Mid to Small cap trackers in UK and US..I can see I've missed most of the boats but...

Any thoughts?

kidmugsy · 21 June 2018 at 1:53PM

In hopes of some compensation for mistiming or misjudging investments you should take advantage of tax breaks. So if you have any spare capacity to contribute to pensions, use it. You still have to decide what to hold within the pension of course.

Have you got a spousal tax shelter? Fill her pension too.

Cash: there are current accounts and regular savers paying 5% p.a. Fill yer boots, and then move onto accounts paying 3%, 2.5%, ... If you find yourself using the whole of your Savings Allowance for interest, then consider using Premium Bonds - their winnings are tax-free and they are near-enough cash.

Note too that the interest paid on Gilts can also be used against the savings allowance and that Gilts don't pay CGT. Therefore consider holding some of your bond investments outside tax shelters to leave space within them for equities. It means that you would have to do some of your portfolio rebalancing yourself rather than paying Vanguard to do it, but the tax savings may justify a little work once a year. (For example, rebalance when you make your annual ISA contributions.)

Consider diversifiers beyond cash and bonds. Property, commodities, gold, ...

If you are daring enough to hold some actual shares rather than collective investments, be sure to hold US and Canadian shares within your pension which (if you've picked the right one) will claim back half the withholding tax.

That's enough of a sermon for now.

Oops: one more point. Scatter your wealth over different providers as defence from fraud, IT !!!!-ups, and Lord knows what.

grey_gym_sock · 21 June 2018 at 4:24PM

i'm a bit confused by the "sold flat" bit ... do you own your current home (mortgage free), or not own any property at all?

are you currently earning, and if so are you on basic rate tax?

i fully approve of the whisky, but it's not an investment if you drink it

with such large sums to consider, personally i wouldn't waste time with piffling amounts in current accounts etc. much more productive to put your mind to what hold for equities etc, and how to use tax shelters. (however, £50k in premium bonds is perhaps worth considering.)

vivvov · 21 June 2018 at 8:54PM

..sold flat and moved in with partner. Partner works for NHS and is undertaking a employer backed qualification but once that's finished we aim to look to sell that flat too and move out of London for good..club together 100kish each and buy somewhere else..2/3 bed terrace with a garden somewhere.
Meanwhile the money needs to be invested somewhere.
Plus partner has £200k to invest..and is relying on following up what I do.. too busy working to look indepth so doing the hive brain thing.
Pension wise I'm looking to open up a SIPP and possibly transfer in 4 individual company pensions plus stuff more money into the SIPP but presently not working so I read somewhere that tax relief is on £2880/annum maximum. After I finish doing up and selling my houseboat (forgot to mention that) I'll probably get back to work (..had Dad and Unc die off in quick succession so been a bit busy and couldn't be bothered with working..too much like hard work/life too short).
However no reason why partner cannot dump up their NHS pension via setting up a SIPP...so looking into doing that after they have sorted out what 'additional voluntary contributions' into their NHS pension actually means re tax benefits.
Trying to maximise the tax breaks/incentives and save as much as possible where ever possible..
(..plus only drinking the No Age Statement stuff).

ConMan · 24 June 2018 at 8:54AM

Slightly off topic, what bikes do you have?

kidmugsy · 24 June 2018 at 11:03AM

vivvov wrote: »

However no reason why partner cannot dump up their NHS pension

I hope you meant "bump up".

sjp999 · 24 June 2018 at 3:25PM

kidmugsy wrote: »

I hope you meant "bump up".

I need my eyes (and probably my brain) examined - I missed the "up" bit and thought why would anybody ever want to do that?

Actually, I do know somebody who did exactly that, she doesn't think much of her ex husband these days.

New to Investing..sort of an evolving plan

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