Investment & Investing

This is one of the best explanations of a time weighted return I've seen. Thanks.

I’ve switched recently, was lifestrategy and target retirement funds (on vanguard) but have switched to 100 equity global/developed world funds.

Pension isn’t being accessed for 2o years and hopefully the same for isa, so happy to up the risk. I wasn’t aware that the lifestrategy and (I think) also the target retirement were so heavily uk weighted.

These are a couple of good articles on the diversifying point

https://monevator.com/assume-every-investment-can-fail-you/
https://monevator.com/investor-compensation-scheme/

TLDR there is risk in all your eggs being in one basket - mainly from fraud, breach of regulations or IT systems failure. The main risk is not that all your money will disappear but that there would be disruption and you wouldn't be able to access it for a period - which might be exactly when you want/need it, and that some of it would disappear to cover administrator's costs.

The last comment on the second one actually talks about HSBC being fined £57m the other week for not classifying investments as being covered by FSCS when it should have done.

But it doesn't seem to be a major deal and most people don't seem to fuss about it.

I think I'll split it between two funds as that is very easy to do and costs me like £5. Ideally I'd also split between two platforms in case Iweb (owned by Lloyds) dies, but I CBA to do the transfer, and it will be more admin down the road, so I'll live with that.

For calculating returns I’ve found this sheet handy:
https://www.bogleheads.org/wiki/Calculating_personal_returns

Helpful for calculating returns over different time periods and multiple accounts.

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Anyone done any research on the cheapest platform is for a Junior SIPP and Junior ISA?

I can do the JISA on Vanguard where my stuff is, but they don't do a Junior SIPP so could put both on another platform. Although ideally I will have it all set up before then end of the tax year.

Fidelity don’t charge platform fees on junior products so are cheapest. I have set up both junior SIPP and isas with them with no issue

Thanks, I just found that too. Do you need your own accounts with them or can it just be for jnr?

read this: https://www.ii.co.uk/ii-accounts/sipp/junior-sipp-vs-junior-isa

so Junior SIPP gains are taxable i.e. I have to declare for self assessment ?

Is that the only diff?

The only reason I stopped paying into Junior ISA was because the kid gets control on their 18th birthday, I dont want that.

I don’t have a fidelity account other than the junior SIPP and junior isa

SIPP (junior or normal) gains are tax free.

Differences between junior isa and junior SIPP are when you can access and how much tax relief you get

ah ok but in both products the control to withdraw is with the child when they become 18 right?

The only reason I stopped paying into Junior ISA was because the kid gets control on their 18th birthday, I dont want that.

lol

so Junior SIPP gains are taxable i.e. I have to declare for self assessment ?

That doesn't sound right. Taxable when they are withdrawn as part of a pension I would assume it means.

I couldn't really see any benefits to a junior ISA if you're not topping out your own ISA allowance. Just create a new pot or whatever and have that flexibility.

They will need to be 55+ to get the actual Junior SIPP money, but at 18 it will become a regular SIPP under their control and they could potentially invest it all in bitcoin.

This is also my fear

could potentially invest it all in bitcoin.

yeah that is scary .. or buy campag

interesting to see if recent cash injection will help bluebird bio recover. i didn’t know that the drug would disproportionately benefit black and racial minority people who are correspondingly affected by sickle cell illness in the US. makes me think that the company is less likely to do well- because racism- but makes it a more significant story than previously thought

Oh Reddit. They’ve done their IPO today, and closed 48% up.

Retail investors can buy stocks from 4 online brokers: Morgan Stanley, Fidelity, SoFi, and, of course, Robin Hood.

Weird I was watching this in the trading 212 app and they have it falling off a cliff.
I can see you are right, but that seems to suggest that the app isn’t really doing what it claims to be doing

Weird I was watching this in the trading 212 app and they have it falling off a cliff.

Probably because they start their graph at the opening price of $54.71 rather than the IPO price of $34.

It ended up yesterday on $50.44 so if you start the graph at $54.71 it doesn't look good at all.

Googling for RDDT will get you a proper share price graph.

Cheers makes sense

Someone help me figure out tax relief on post-tax pension payments?

Higher rate threshold is currently £50271. If a taxable salary (i.e. after workplace SS pension contributions) was, say, £55271, you would be paying the 40% rate on that £5k over the threshold.

If you wanted to "maximise" your tax saving i.e. bring yourself below the 40% rate threshold but not contribute more than you need to to achieve that, would you contribute £5000 to a SIPP? Or is it £4000 because of the basic rate relief you get? I'm getting different answers from different online calculators. I think I'm confused because the relief you get is a combination of extra money that goes into the SIPP automatically, and a refund on the paid tax.

As far as I understand it, and how I have managed this with a Hargreaves SIPP is that I would put in 4K, HL claim 1K on my behalf a few weeks later making total contribution of 5K, the in your tax return you declare the contribution you made and receive 1K rebate, so cost to you to put 5K of your higher rate taxable salary in SIPP is 3K (eventually)

Is anyone using Wealthify, Moneyfarm or nutmeg? All three have 0% mgmt fees for first year and wondering whether to try them over Vanguard.

will be for s&s isa.

Have Nutmeg S&S ISA and Junior ISA, only because there was a decent cashback offer when I started with them. Seems fine but I don't know if they've outperformed Vanguard over the same period (though could me my poor timing adding lumps).