Investment & Investing

spend the time going to meet at their offices

if it were me, i wouldn't be turning up to this.

as you have already identified, they have a few £k of neartime payout riding on this whereas you have nothing riding on it.

my expectation is that it will be hard sell in a hot office which you are better off without.

of course i could be wrong , but probably not by much.

Monevator's broker table is the best place to look to compare them, as per Matt's post above.

Mainly it depends on your fund size, whether you are better paying a fixed or % fee. Otherwise they all essentially so the same thing. Vanguard only has its own funds, which may or may not be an issue for you (would be for me) .

I'm with iweb. They've been fine for 15 years but I am thinking of switching as they are expensive for US shares. I didn't have any US shares until this year so was never previously an issue.

I noticed that freetrade is doing a promo the other day, they pay you for transferring a pension to them.

Edit - this has been a bit superseded by the subsequent discussion. I think running a mile sounds like a good plan!

Suggestion to get a low cost wrapper / SIPP and invest in a global tracker is good advice. Unless you think you can beat the market at investing that's the best thing to do.

Thanks, think I've got it figured out.

My total contributions (personal contributions into workplace pension, plus private pension) are far less than the amount I'm paying 40% tax on. I'm pretty certain that means I should be getting the full extra 20% back.

Still feels like I'm gonna need professional help to confirm it and convince HMRC they've made a mistake tho', which is pretty annoying.

This might be useful to work out the numbers - https://www.pensionbee.com/uk/pension-tax-relief-calculator

Are you calculating what you think you are owed on both workplace and personal contributions?
Workplace contributions could be 'salary sacrifice' or 'net pay' so would not get any relief (but you wouldn't have paid tax on them). So you might only be due the 'extra' 20% back on your personal contributions.

Salary Sacrifice; money removed from your wage before the income tax and national insurance calculations (you keep the NI.)

Net-Pay; money removed from your wage before the income tax, but after the national insurance calculations (you lose the NI.)

Relief-at-source; money removed from your wage after both income tax and national insurance calculations. You get/claim the income tax back afterwards (you lose the NI.)

You might need some help in calculating your submission, but the best way to do this should via any tax return. I assume you submit one each year?

The situation would be much more understandable if that were the case, but I'm not SA.

HMRC requested I send them statements for both pensions, and figured it out themselves in some opaque fashion.

A super-helpful chat with Arvy (thanks again!) seems to have concluded that I'm justified in questioning HMRC's workings. Am getting on their case immediately but have a feeling this might take a while.

is there an easy way to rank Vanguard fixed income funds by yield?

on their website, i have to check each one individually...

I thought you could do it by making a Google sheet of every ticker and then calling the GOOGLEFINANCE function, but I can't get it to work.

Here's the list of tickers and ISINs if you find a solution:
https://docs.google.com/spreadsheets/d/11KbqTaXHRAGwd7oAgBx00U8wiA8vvarROkhp9gPaTs4/edit?usp=sharing

You might need to pay for a Financial Times or Morningstar account to build a portfolio, or something.

thank you - the list itself is v helpful.

Has anyone done a fee comparison of S&S Lisas recently?

I'd have expected mse to have one, but they don't.

I went through the LISA providers and did a manual comparison 18 months ago and ended up opening one with AJBell. Things may have changed since then but there aren’t so many LISA providers so a manual check isn’t too time consuming. Search the monevator broker comparison for “LISA” and they may give a steer.

Anyone got a trading 212 referral they want to share?

dm me your email / phone number and i will :-)

Not done a spreadsheet, but my research also led me to Dodl (AJ Bell app-only platform) - just transferred my LISA to them. Process been pretty easy and fees v good.

https://www.trading212.com/invite/FysSdTA8

this link doesn't work - best use this one

https://www.trading212.com/invite/FfozYK6k

I posted a couple of weeks ago after meeting with an IFA who was recommending that I move the vast majority of my defined contribution pension to abrdn wrap, into a fund that their firm manages.

After getting some good advice from a couple of you on here, I emailed them to ask the following:

1. Can you tell me more about why you recommended abrdn wrap, especially given the terrible reviews I’ve seen on Trustpilot?

2. Can you tell me more about why you’ve recommended putting 100% in this fund, and why I wouldn’t be better off as an example, 60% in a low-cost all-world equities tracker (some which are up 70% over the same 5 years for an 0.15% fee), and the rest in bonds, in a low-fee SIPP such as ii?

Here’s my paraphrase of their response.

1. You as the customer wouldn’t be using abrdn wrap, I would be as the IFA. I’ve used them for many years, they’ve won many awards for many years, and the 141 review on Trustpilot likely aren’t representative of a product used by 408k clients to invest £75bn.

2. The product I recommended is an investment portfolio that our firm runs for our clients. This means we can tweak it as we need in the future to match your target level of risk. They’ve sent me a full breakdown of what is in this investment portfolio to show the diversification of asset classes and regional exposure. They said that if you want to invest heavily into a world equity tracker then we can discuss it, but it wouldn’t have been right for me to recommend something like that given the information you have provided previously.

They also said that it’s important to remember that pension and investments are just 1 part of the process, and they’re also looking to control your tax position (I’m looking to put more into my pension over the next couple of years to take my adjusted income under 100k so I can retain some free childcare hours). There are further recommendations in the report that will restore my personal allowance in the future and see further tax relief through my tax code. This will effectively increase my take home pay each month.

Those answers seem sensible and reasonable to me. I think I’m gonna go meet with them, but will say that I want to increase the risk of the pension investments and want to do everything possible to decrease the fees for any product my pension is invested in. I’m 34 so a long way from retirement, and I think high fees is the best way to erode any gains you make on investments. We can then obviously reduce risk as I get closer to retirement.

I’ll ask if they could baseline whatever their new recommendation is against just putting 100% into the HSBC FTSE All World Index fund over the last 5 years.

The literature about their own fund that they’ve recommended is all about wealth preservation and inflation beating returns over the medium to long term. At this stage in my life, I think I should be looking for my investments to grow my wealth rather than maintain it! Over the last 5 years the fund has had 15-20% in cash, 35-40% in bonds, and 40-45% in stocks. I definitely think those percentages are too conservative, and could do with a decent chunk more moving to stocks. Equities are 44% in the US, 23% in the UK, 19% in tech, 17% in financial services. It seems fairly standard and western world weighted to me.

I happened to read an interesting article on model portfolios recently, after signing up to the Monevator newsletter: https://www.morningstar.com/personal-finance/ask-these-questions-before-investing-model-portfolios. Thanks for the recommendation, @Matt101 !

If anyone has other thoughts after hearing the above, I’d very much like to hear them. I’m very new to all this, so I welcome different perspectives.

I’m looking to put more into my pension over the next couple of years to take my adjusted income under 100k so I can retain some free childcare hours).

Just need to salary sacrifice right? I don't think you need an IFA for that

Over the last 5 years the fund has had 15-20% in cash, 35-40% in bonds, and 40-45% in stocks.

And they want a 1% fee for managing that? Seems pretty disgusting

Even if you want an actively managed fund, it's hard to believe that it's genuinely in your best interest to use the IFA's own fund over Baillie Gifford or whoever. It kinda raises questions around the "I" part of "IFA"

The literature about their own fund that they’ve recommended is all about wealth preservation and inflation beating returns over the medium to long term.

I.e. the same BS they all say to justify their fee.

I mean, is there another fund somewhere that isn't about wealth preservation?

Your reasoning seems pretty sound but why compare the fund to HSBC FTSE All World, you could compare to B0CNH05 (L&G tracker) instead which has performed historically far better than the HSBC one because it has a higher proportion of tech shares.

Thing is none of the past performance can be used to guarantee future performance and that's why a managed fund takes a more conservative position.

If you want high risk I think you have to manage it yourself and test your own theories out at your own risk.

I'm not recommending an IFA but if they are charging you to help you manage your tax situation (which is what it sounds like to me) then you need to either figure out how to do that yourself or accept the fees and be overall better off. Personally I'd figure out how they are dealing with the tax and do it myself.

test your own theories out at your own risk.

And hope that you get lucky, or assume that you know more than the collective knowledge of global financial markets, which seems unlikely.

Some brave people just get lucky! I have a list of brilliant decisions I wasn't brave enough to take.

For sure, it will play out for some people.

My last brave decision was RBS back when it had a yield of over 6%. Then 2008 happened and I found out why.