Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

Investment strategy for next 20+ years

Stocks and Shares ISA , Choosing funds for ISA's, risk factors for funds etc
Investment strategy discussions not dealt with elsewhere.
Plutus
2 Lemon pips
Posts: 130
Joined: January 3rd, 2017, 11:24 am
Has thanked: 52 times
Been thanked: 7 times

Re: Investment strategy for next 20+ years

#20215

Postby Plutus » January 5th, 2017, 8:48 am

The additional replies have been very helpful, I won't thank each person individually but I appreciate it.

If nothing else this has confirmed some of my attitudes to risk, my aversion to losing capital, my bias towards reducing debt, a fear of frittering away my hard earned cash, my habit of interfering too much with my shares ISA account etc. etc.

What to do next?

Of my total investments including cash available to invest I have a 50% exposure to equities, this is divided between the HYP/income type portfolio and the index tracker passive portfolio that I'm running from pension Additional Voluntary Contributions provided by Prudential. My planned asset allocation is 75% equities, 25% cash/bonds but I may re-appraise this in light of my attitude to risk. A possible 60/40 split may suit my temperament.

1. I will continue to overpay the mortgage. I cannot release any overpayments but we are due to re-mortgage in 2019 and I can reassess the situation then.
2. I will aim to build up the amount invested within the shares ISA, drip-feeding into income generating investment trusts and reinvesting the dividends. I may also resume contributions into the HYP portfolio and will ask for opinions on the appropriate forum.
3. I will still be relatively cash-heavy so I won't lose my shirt if the stock markets plummet and I can ramp up equity investments when valuations are less frothy.

LooseCannon101
Lemon Slice
Posts: 252
Joined: November 5th, 2016, 2:12 pm
Has thanked: 302 times
Been thanked: 147 times

Re: Investment strategy for next 20+ years

#22954

Postby LooseCannon101 » January 13th, 2017, 7:01 pm

Have you considered one or more one-stop shop, global growth investment trusts e.g. Foreign and Colonial (FRCL), Alliance or Witan? I've been investing in FRCL for the past 20 years, gradually building up my holding using their saving scheme.

Pound-cost averaging isn't just a sales ploy - it actually works. Average returns of about 8% per year can be achieved so long as you keep your nerve and don't sell out during periods of market gloom. Market prices are slightly high at the moment, but no matter what the price, it is always a good time to save a set amount per month and re-invest one's dividends.

Plutus
2 Lemon pips
Posts: 130
Joined: January 3rd, 2017, 11:24 am
Has thanked: 52 times
Been thanked: 7 times

Re: Investment strategy for next 20+ years

#23199

Postby Plutus » January 15th, 2017, 10:28 am

LooseCannon101 wrote:Have you considered one or more one-stop shop, global growth investment trusts e.g. Foreign and Colonial (FRCL), Alliance or Witan? ....

Pound-cost averaging isn't just a sales ploy - it actually works. Average returns of about 8% per year can be achieved so long as you keep your nerve and don't sell out during periods of market gloom. Market prices are slightly high at the moment, but no matter what the price, it is always a good time to save a set amount per month and re-invest one's dividends.


Good morning, thanks for replying to my question.

FRCL seems to be mentioned on many occasions especially regarding investing for children. I'll take a further look at it.

Your point about regular investment stands out though; I really need to commit to a long term plan and stick to it without meddling too often.

I have had many different ideas over the past few weeks but I'm leaning towards income investment trusts and international ETFs, luckily I'm not in a rush!

Plutus
2 Lemon pips
Posts: 130
Joined: January 3rd, 2017, 11:24 am
Has thanked: 52 times
Been thanked: 7 times

Re: Investment strategy for next 20+ years

#28872

Postby Plutus » February 3rd, 2017, 8:48 pm

Gadge wrote:Just reread this thread and noticed I did not warn you of the dangers of over weighting by holding multiple ITS.

City and Edinburgh share many of their top ten picks.
As do Finsbury and City.

Your best bet if you do wish to hold more than one UK focused IT is read their top ten and try not to get too many doubles.

Gadge


Thank you Gadge. I haven't put any plans into action yet as I'm still researching my next steps.

On another thread someone referred to the Morningstar x-ray tool that can be used to analyse the mutuality between investment trusts.

I have also found out that the Edinburgh, invesco income and growth (ivi) and perpetual income (pli) are all from the same stable so I certainly wouldn't buy all 3.

I downloaded a report from city of London (cty) to check their holdings and it's not dissimilar to a HYP apart from obvious sectoral omissions. As I have a hyp-ish portfolio I could either continue building it or buy 1 or 2 uk equity income ITs, but use investment trusts mainly to cover other geographies and aims.

I'm still not ready to commit new cash and still might just setup a regular investment for the vanguard global etf (vwrl) and try to forget about investing for a long time.

77ss
Lemon Quarter
Posts: 1271
Joined: November 4th, 2016, 10:42 am
Has thanked: 233 times
Been thanked: 414 times

Re: Investment strategy for next 20+ years

#28902

Postby 77ss » February 4th, 2017, 1:17 am

Plutus wrote:I also have a nagging feeling that I would have fewer sleepless nights if I paid off the mortgage instead of having a relatively large sum invested in equities.


This is going to vary from individual to individual, but I can distinctly remember the feeling of liberation when I paid off my mortgage. Interest rates were higher then, but that's not the only factor.

Kantwebefriends
Lemon Slice
Posts: 356
Joined: November 5th, 2016, 4:02 pm
Has thanked: 26 times
Been thanked: 102 times

Re: Investment strategy for next 20+ years

#39458

Postby Kantwebefriends » March 18th, 2017, 12:47 pm

Plutus wrote: With my current service I would at this point receive a pension that's equivalent to about 1/3 of my annual salary. If I'm mortgage and child free in 23 years then my wife and I should have a comfortable retirement if I continue being a member of the LGPS.

My rationale for building isa investments was as a hedge against the possibility that I change jobs or if I would require access to the capital before I retire. I also have a nagging feeling that I would have fewer sleepless nights if I paid off the mortgage instead of having a relatively large sum invested in equities.


If your wife should happen to be under 40 on 6/4/17 you could urge her to open a LISA. The full tax advantages wouldn't accrue unless she kept it until she's 60 but it would be available, subject to penalty, in an emergency.



The purpose of investing is to add to your comfort and security; if its costing you sleep, change things.

[I'm quoting someone but I don't know who.]

Plutus
2 Lemon pips
Posts: 130
Joined: January 3rd, 2017, 11:24 am
Has thanked: 52 times
Been thanked: 7 times

Re: Investment strategy for next 20+ years

#39616

Postby Plutus » March 19th, 2017, 1:49 pm

Kantwebefriends wrote:
If your wife should happen to be under 40 on 6/4/17 you could urge her to open a LISA. The full tax advantages wouldn't accrue unless she kept it until she's 60 but it would be available, subject to penalty, in an emergency.



The purpose of investing is to add to your comfort and security; if its costing you sleep, change things.

[I'm quoting someone but I don't know who.]


Hi I shall mention it to her, she seems to have more tucked away in cash and investments than I do, more proof that a hands off attitude works best!


Return to “Investment Strategies”

Who is online

Users browsing this forum: No registered users and 10 guests