Pensions and ISA ideas

Strat_a_tat_tat

Hattigol said:

bgmartinsbridge said:

The big question is V or U or L? 

This is neck shapes, right?

If you've got an L shaped neck... no amount of truss rod tweaking is going to fix that.

bgmartinsbridge

Sell in May and go away? 

RandallFlagg

bgmartinsbridge said:

Sell in May and go away? 

"Sell in May, Virus here to stay" more like

bgmartinsbridge

@RandallFlagg - have a wiz lol

Zoolooter

Closely watching since April as I’ve held off buying so far. Pessimistic news today, and I think the economic doom mantra from the media will be here to stay. I’ll look at the prices again in a month.

Rob1742

RandallFlagg said:

Some fear in the stock market this week with a sharp drop today of around 3% so far in the FTSE markets.

Is this the start of the slow slide back down as the reality of the economic impact hits home after the April and early May rally?

I have just trusted a lump of money with a bank who are investing it for me. Their view was a big fall is what may well happen. Their view was what you have basically just said. The recent fall and then gain were both down to market sentiment. Their worry is the size of the drop when companies present their figures which show the actual economic impact. 

RandallFlagg

Rob1742 said:

RandallFlagg said:

Some fear in the stock market this week with a sharp drop today of around 3% so far in the FTSE markets.

Is this the start of the slow slide back down as the reality of the economic impact hits home after the April and early May rally?

I have just trusted a lump of money with a bank who are investing it for me. Their view was a big fall is what may well happen. Their view was what you have basically just said. The recent fall and then gain were both down to market sentiment. Their worry is the size of the drop when companies present their figures which show the actual economic impact. 

I would be more worried about a Bank “investing it for me” that anything the stock market will do!

Why on earth would you trust a Bank with such a decision? Do you know what they are investing your money in and what the fees are?

RandallFlagg

Whatever has the UK investors on the run today hasn't spread to the US markets. The leading US indices are in the green but May is flattening out keeping the S&P500 around 2800-2850 mark, just shy of the 3000.

RandallFlagg

...and...the UK markets are back in green this morning. Obviously the economic impact of the virus is all OK today now and all is good with the world. :-)

You can't ever call the stock markets and how they will move!

DefaultM

Shit I was hoping it would continue down. There's still 6 days till my regular investment comes out. My problem is I don't want to pay £8 a time when I see prices drop, just for the sake of putting in another few hundred.

Rob1742

RandallFlagg said:

Rob1742 said:

RandallFlagg said:

Some fear in the stock market this week with a sharp drop today of around 3% so far in the FTSE markets.

Is this the start of the slow slide back down as the reality of the economic impact hits home after the April and early May rally?

I have just trusted a lump of money with a bank who are investing it for me. Their view was a big fall is what may well happen. Their view was what you have basically just said. The recent fall and then gain were both down to market sentiment. Their worry is the size of the drop when companies present their figures which show the actual economic impact. 

I would be more worried about a Bank “investing it for me” that anything the stock market will do!

Why on earth would you trust a Bank with such a decision? Do you know what they are investing your money in and what the fees are?

Yes - i have done the research and fees are cheaper. I mainly invest in Fundsmith and one other fund, but my knowledge on it isn’t great so needed someone to put together a more balanced fund, which I don’t have the experience of.

PolarityMan

Can anyone tell me if selling stocks in my stocks and shares to cash still in the ISA has any detrimental effect?

SO for example if I sell my FTSE100 holding now to take advantage of the rise before an expected second dip does that reduce my total ISA allowance, or is it fine because the cash stays in the stocks and shares ISA?

I know its timing the market but seems like a second fall is inevitable.

I guess I could hedge and prepare to put more in if the falls again. 

Its all in vanguard btw if it makes any difference. 

Jalapeno

PolarityMan said:

Can anyone tell me if selling stocks in my stocks and shares to cash still in the ISA has any detrimental effect?

SO for example if I sell my FTSE100 holding now to take advantage of the rise before an expected second dip does that reduce my total ISA allowance, or is it fine because the cash stays in the stocks and shares ISA?

I know its timing the market but seems like a second fall is inevitable.

I guess I could hedge and prepare to put more in if the falls again. 

Its all in vanguard btw if it makes any difference. 

AFAIK you can move freely between ISAs without penalty, but you can only have 1 Stocks & Shares ISA.

Barnezy

I do a lot of this and have got to a point where I'm making more in a day than I do working. 

The key I've found is to not chase big returns and to be patient. I started 12 years ago and have maxed out my S&S ISA for myself and my wife each year. Initially the return was low in momentary value, but now a 5% gain is substantial. That's the patience part, it takes years to build the wealth to a point where it can be impactful on your life. Too many people start late unfortunately. 

With regards to not chasing big returns I mean risking to much on a few ideas. I tend to have about 10% in gold, 40% in market trackers, 20% in managed funds, 20% in blue chip stock, evenly split between the UK and US and I save 10% for risky stuff. 

I've make over 200% returns in 6 months on some of my risky stuff and sometimes think, I should have put more in, but quickly remind myself my goal is 5-7% gain YoY. 

In the current market conditions, anyone can make big returns. I'd just suggest not getting too pulled in to a high return mentality and not hedging, otherwise you could end up with some losses. 

The other thing is to reduce losses as much as possible, but never sell on a lose. When the virus was kicking off in Italy, I sold all my positive positions and held cash. Because of this I've made an extra 30%+ vs if I'd stayed in, like a lot of my friends did. 

I'm getting to a point now, where I'd rather pay a wealth manager to handle things. It can consume a lot of time and play on emotions if you're doing it all yourself. 

Jalapeno

Barnezy said:

I'm getting to a point now, where I'd rather pay a wealth manager to handle things. It can consume a lot of time and play on emotions if you're doing it all yourself. 

Indeed ! WISd

PolarityMan

Barnezy said:

I do a lot of this and have got to a point where I'm making more in a day than I do working. 

The key I've found is to not chase big returns and to be patient. I started 12 years ago and have maxed out my S&S ISA for myself and my wife each year. Initially the return was low in momentary value, but now a 5% gain is substantial. That's the patience part, it takes years to build the wealth to a point where it can be impactful on your life. Too many people start late unfortunately. 

With regards to not chasing big returns I mean risking to much on a few ideas. I tend to have about 10% in gold, 40% in market trackers, 20% in managed funds, 20% in blue chip stock, evenly split between the UK and US and I save 10% for risky stuff. 

I've make over 200% returns in 6 months on some of my risky stuff and sometimes think, I should have put more in, but quickly remind myself my goal is 5-7% gain YoY. 

In the current market conditions, anyone can make big returns. I'd just suggest not getting too pulled in to a high return mentality and not hedging, otherwise you could end up with some losses. 

The other thing is to reduce losses as much as possible, but never sell on a lose. When the virus was kicking off in Italy, I sold all my positive positions and held cash. Because of this I've made an extra 30%+ vs if I'd stayed in, like a lot of my friends did. 

I'm getting to a point now, where I'd rather pay a wealth manager to handle things. It can consume a lot of time and play on emotions if you're doing it all yourself. 

At 38 hoping not left it too late. Have been paying to a pension too obviously but only opened an S&S ISA for the first time this year. Im still talking about low monetary value but it seems like doing a bit of micromanaging can increase return over jsut leaving it in for the long run.

I managed to get in about a week after the lowest point so has done quite well and tempted to move back to cash and wait another drop.

Of course if the drop doesnt come it leaves me buying in again at a higher cost.

Barnezy

If you're goal is retirement at 58, then you have 20 years to build. If you can get at least half your ISA allowance in per year (c£800pm) and aim for a 7%YoY return, you're looking at c£527k in 20 years time with inflation, with only £243k in deposits. Had you started 10 years earlier, it would be £1.3m.

That's why I started my kids ISA's the day they were born, as time is the biggest factory in wealth creation and something you can't earn more of. 

However now is the best time in years to start given the market conditions, so you'll benefit from that. 

I'd focus initially on an Accumulation All FTSE tracker and an S&P tracker. Low risk over the long term. Once you're comfortable with that, build out some specific low risk stocks. 

Strat_a_tat_tat

Barnezy said:

If you're goal is retirement at 58, then you have 20 years to build. If you can get at least half your ISA allowance in per year (c£800pm) and aim for a 7%YoY return, you're looking at c£527k in 20 years time with inflation, with only £243k in deposits. Had you started 10 years earlier, it would be £1.3m.

Don't know if I'm missing something and being a bit thick... but I'm not sure I follow the above maths.
£800 per month for 20 years is £192k in deposits (not £243k). I've not made any allowance for inflation (to increase the monthly investment sum) as we don't know what inflation will be.

Hargreaves Lansdown has a calculation tool that says £800 per month for 20 years (with 7% pa growth) results in a total fund of £408,324. (and 30 years would result in a fund of £940,851).  What am I missing?

Also... is 7% pa a reasonable expectation?

PolarityMan

Barnezy said:

If you're goal is retirement at 58, then you have 20 years to build. If you can get at least half your ISA allowance in per year (c£800pm) and aim for a 7%YoY return, you're looking at c£527k in 20 years time with inflation, with only £243k in deposits. Had you started 10 years earlier, it would be £1.3m.

That's why I started my kids ISA's the day they were born, as time is the biggest factory in wealth creation and something you can't earn more of. 

However now is the best time in years to start given the market conditions, so you'll benefit from that. 

I'd focus initially on an Accumulation All FTSE tracker and an S&P tracker. Low risk over the long term. Once you're comfortable with that, build out some specific low risk stocks. 

I have some in an S&P 500 tracker too. I was a bit worried that ALL FTSE might be hit more by companies failing 

Barnezy

Strat_a_tat_tat said:

Barnezy said:

If you're goal is retirement at 58, then you have 20 years to build. If you can get at least half your ISA allowance in per year (c£800pm) and aim for a 7%YoY return, you're looking at c£527k in 20 years time with inflation, with only £243k in deposits. Had you started 10 years earlier, it would be £1.3m.

Don't know if I'm missing something and being a bit thick... but I'm not sure I follow the above maths.
£800 per month for 20 years is £192k in deposits (not £243k). I've not made any allowance for inflation (to increase the monthly investment sum) as we don't know what inflation will be.

Hargreaves Lansdown has a calculation tool that says £800 per month for 20 years (with 7% pa growth) results in a total fund of £408,324. (and 30 years would result in a fund of £940,851).  What am I missing?

Also... is 7% pa a reasonable expectation?

I've factored in an average 2% inflation (1.79% avg since 1984) over the period including on the monthly payments and compounded interest. The average return on a FTSE tracker 100 tracker 7.35% avg annualised over the past 35 years, so 7% is conservative given the current dip and if you are successful with other investment choices. 

None of this is exact, but it's as close as you can get.