How do you structure your money in retirement?

[xeny]

There seems to be around £500 leftover each month which won't be the actual number as there are incidental costs but it's enough that the general picture is that she's got plenty of income.

How does this square with the post where you said she was withdrawing ~£3000 a year ?

[Aminatidi]

There seems to be around £500 leftover each month which won't be the actual number as there are incidental costs but it's enough that the general picture is that she's got plenty of income.

How does this square with the post where you said she was withdrawing ~£3000 a year ?

Frankly It doesn't.

That's what she takes out from one cash pot (not the S&S ISA) but trust me there's a whole bunch of shuffling money around between half a dozen bank accounts (seven to be precise) that makes very little sense to me but it's her way of doing things and I'm trying not to pry too much.

The "leftover" is a high level between "money in" and "money out the door".

People have their systems.. it's not my way of doing things

[xeny]

If she's into the whole shuffling money around thing, does she do it in a pattern that might fit a regular savings account or two?

At least that way there would be better return on the cash.

[Aminatidi]

If she's into the whole shuffling money around thing, does she do it in a pattern that might fit a regular savings account or two?

At least that way there would be better return on the cash.

One step at a time.

I can't imagine trying to manage half a dozen pots but it's how my mum does things.

Not really for me to try and change that but I have gently suggested there is probably a simpler way even if the end result is the same.

If it was me I'd be trying to nudge her towards a "daily" account, a "savings" account with easy access, and then the Vanguard ISA.

I'm just helping her compose an email to the IFA now and trying to come up with a "polite elderly lady" way of saying "just give my mum the ISA details and take yourself out the loop and we can do the rest" without it looking like something I've written for her

[Aminatidi]

As a quick follow-up by a curious co-incidence a paper statement from the platform has landed today for the last 12 month period.

Not sure if it's been sent because it was the review last week or if it's just a co-incidence.

£35K in the platform.

£850 in fees.

Speaking to my mum she has paper statements that show everything month by month and I've seen many of those when I went through things for/with her but neither she or I can recall one which is a summary of fees that outlines the bottom line so starkly.

[staffordian]

As a quick follow-up by a curious co-incidence a paper statement from the platform has landed today for the last 12 month period.

Not sure if it's been sent because it was the review last week or if it's just a co-incidence.

£35K in the platform.

£850 in fees.

Speaking to my mum she has paper statements that show everything month by month and I've seen many of those when I went through things for/with her but neither she or I can recall one which is a summary of fees that outlines the bottom line so starkly.

Ooh, that seems steep.

Whilst I accept I'm comparing apples and pears, I pay £12.50 per annum to Halifax for a stocks and shares ISA holding my IT portfolio which is almost three times this value (though it's a flat fee so value isn't really relevent).

[Alaric]

I've seen many of those when I went through things for/with her but neither she or I can recall one which is a summary of fees that outlines the bottom line so starkly.

In the other thread, you recorded what you thought was being paid as fees. What's been charged seems a bit more than that, although some of it may have been inside the fund, dealing costs when the fund switches investments for example.

[xeny]

£35K in the platform.

£850 in fees.

I'm pretty sure MyFolio is a fund of funds. If the fees they typically quote are "their" fee rather than the total of the constituent fund fees and their fee, and this analysis forces the publication of the nested fees as well, I can see how this kind of figure might arise and yet be a shock to the system.

2.4%. Does this include, or is it in addition to the adviser's fees you quoted at 1%?

[Aminatidi]

The statement includes everything including fund fees and the 2.2% was also including fund and platform fees.

The plan is to help her open a Vanguard ISA tomorrow/weekend as between the statement and going through some online calculators with her to highlight the difference fees make I think she's a newly found interest (pardon the pun) in how money in her own pocket is better than money in someone else's.

When you think of it another way she's been paying around 10% of her entire annual expenditure in fund and advisor fees

[1nvest]

mum has around £50K in savings accounts and around £40K across a couple of stocks and shares ISAs.

She has a few pensions and each year she withdraws around £3000 in "cash" from those savings to cover living expenses

Just a suggestion - swap the stock ISA's over to a VMID holding (Vanguards FTSE 250 index tracker). From what I've seen that has compared to HYP and for a number of reasons is a good choice of Index Tracker IMO (feeds in and out of top/bottom so tends to be more equal weighted, 50% of earnings from foreign, 20% of index are Investment Trusts i.e. diversified enough, low cost, easy to manage or move if required/desired). VMID 2.85% current dividend yield (after 0.1% VMID expense i.e. 2.95% FTSE dividend yield) recently generates around £1.14K of income on £40K invested, add to that £1.86K drawn from cash savings to provide the £3K disposable income.

For the cash/savings buy into 1, 2, and 3 year high street bank bonds in around equal measure, as each bond matures, roll the surplus (after taking £1.8K or whatever cash to top up dividend income to a combined £3K) into another 3 year bond. Preferably ISA versions. You might alternatively extend out to a 5 year bond ladder. A factor with a fixed term bond ladder is that they are 'fixed term', penalties if you need cash. Holding one rung in instant access tends to yield a lower interest rate but provides liquidity. 1 run in instant access, count that as the bond ladders 1 year rung, buy a 2 year and a 3 year fixed term bonds, roll the 2 year into another 3 year when that 2 year has matured, roll the 3 year into another 3 year when that matures. A form of staggered bond ladder.

Not a recommendation, just the first web site that a search found https://www.money.co.uk/savings-account ... gLb2vD_BwE

Likely over time stock dividend value might relatively expand, requiring less of bonds to be drawn down. As a example HYP pays more in dividends but price appreciates less, overall comparable to the FTSE 250 in total returns - that pays less in dividends but price appreciates more. All else being equal if everything remained the same in inflation adjusted terms, drawing 1.8K/year from 50K of bonds would last 27 years (mum perhaps in her 90's), but in practice there may still be a sizeable amount of bonds still remaining due to dividend yields having grown in real terms. Could even be that the dividends alone were enough to cover the (inflation adjusted) £3K withdrawals. Just ignore any capital valuations of stocks just leave them as-is, as a form of longevity insurance should ever all of bonds have been spent, only then look to selling down some/all of stock. The hard part is having to manage the bond ladder. Best to avoid too much under any one umbrella group so that the funds remain protected by the £85K FSCS limits - but that's not really a issue in your mums case.