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2025 Portfolio
2025 Portfolio
Hi, this forum has been invaluable in getting me to this point and would appreciate everyones thoughts in moving forward into 2025 with the goal to break the £500k networth. Joint income with wife approx £150k a year both in the 40% tax bracket and in our late 20s. A mixture of tech but now mostly global trackers has seen investments tick upwards nicely over the past number of years. Networth breakdown below, for first time ever have ISAs maxed out, savings allowance maxed and built up some cash reserves. Comfortably living off our income so investment timelines are longterm.
Current networth breakdown
Asset Value % of networth
Current House £ 164,406.95 35.6% (Total valuation £215,000 with remaining mortgage £ 50,593.05 - fixed at 2.12% for next few years)
S&S ISA £ 153,319.32 33.3% (HL S&S ISAs - fee capped at £90 per year for both accounts - predominantly VRWP, around 10% mixture of SMT/IPF3 bonds)
Premium Bonds £ 100,000.00 2.7% (current interest rate 4% likely as interest rates fall will continue to reduce)
Savings accounts £ 23,031.30 5.0% (Current interest rates across accounts 4.3% which will likely reduce if interest rates decline)
Cash to deploy £20,000 4.3% (Recently built up income from end of year bonuses)
Debts: Student loans £20,000 (current interest rate 4.3% but when revalued anticipated to be lower)
Total £ 440,757.57
Plan is to top up ISAs with £40k come the new financial year in April. Which leaves a couple of options.
- Mortgage is fixed at 2.12% so feel can comfortably outperform same so no benefit in paying off early.
- Student loans are equivalent to what is being earnt in savings interest at present with interest cost likely to reduce this coming year and also doesn't count towards future loans as debt etc so hesitant to pay off at present but am considering.
- Was thinking likely the best option is to invest the ongoing cash into general investment account - global tracker with dividends being distributed say VRWL split across both of us to maximise dividend and capital gains. Selling at the end of March each year in the case of financial gain then purchasing slightly different global tracker to avoid 30d B&B rules.
- Wondering how people balance potential higher returns with investing outside tax shelter with CGT/dividend allowance so low v keeping premium bonds/cash.
Any thoughts / critiques or general advice all appreicated!!
Thanks
Current networth breakdown
Asset Value % of networth
Current House £ 164,406.95 35.6% (Total valuation £215,000 with remaining mortgage £ 50,593.05 - fixed at 2.12% for next few years)
S&S ISA £ 153,319.32 33.3% (HL S&S ISAs - fee capped at £90 per year for both accounts - predominantly VRWP, around 10% mixture of SMT/IPF3 bonds)
Premium Bonds £ 100,000.00 2.7% (current interest rate 4% likely as interest rates fall will continue to reduce)
Savings accounts £ 23,031.30 5.0% (Current interest rates across accounts 4.3% which will likely reduce if interest rates decline)
Cash to deploy £20,000 4.3% (Recently built up income from end of year bonuses)
Debts: Student loans £20,000 (current interest rate 4.3% but when revalued anticipated to be lower)
Total £ 440,757.57
Plan is to top up ISAs with £40k come the new financial year in April. Which leaves a couple of options.
- Mortgage is fixed at 2.12% so feel can comfortably outperform same so no benefit in paying off early.
- Student loans are equivalent to what is being earnt in savings interest at present with interest cost likely to reduce this coming year and also doesn't count towards future loans as debt etc so hesitant to pay off at present but am considering.
- Was thinking likely the best option is to invest the ongoing cash into general investment account - global tracker with dividends being distributed say VRWL split across both of us to maximise dividend and capital gains. Selling at the end of March each year in the case of financial gain then purchasing slightly different global tracker to avoid 30d B&B rules.
- Wondering how people balance potential higher returns with investing outside tax shelter with CGT/dividend allowance so low v keeping premium bonds/cash.
Any thoughts / critiques or general advice all appreicated!!
Thanks
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- Lemon Quarter
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Re: 2025 Portfolio
mark85 wrote:Any thoughts / critiques or general advice all appreicated!!
Surprised you both are not prioritizing pension/SIPP contributions at 40% tax relief, or have I missed that ?
And not cleared your mortgage with some of those premium bonds ? (It is a great feeling doing that in your late 20s...)
From your late 20s a portfolio of blue chips or ITs could by my reckoning decuple the income it produces for you over the next three decades, through the combined effects of dividend increases, cuts and reinvestment. Even more with contributions along the way. By way of example, have a look at: viewtopic.php?p=698938#p698938
Unlike many of us here, you have bags of time. Take full advantage of the compounding that can be done with that.
Re: 2025 Portfolio
Thank you for the reply! Yes you are entirely correct pensions should be included - both have NHS pensions 12.5% contribution with generous 23.7% employer contribution. The honest answer is that it's so far away and no great option for overpayment within the scheme just let it do it's inflation linked growth. Don't fancy SIPP as likely in time will move to bigger house etc. Will have a look at that post thanks!!
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- Lemon Quarter
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Re: 2025 Portfolio
I notice you are rematkably specific with some of your numbers 
As Moorfield suggests - depending upon your arrangement and length of fixed term, then prioritising paying down the mortgage is a good step - some people prefer to keep a small one but I found owning the house outright was great for peace of mind. Also the rate might be 2.12%, but that is from taxed income, so you'd need to earn nearly 4% to get the same return. It also means if/when you upsize that the new loan will be lower. Also there is no guarantee that markets and interest rates will stay as they are.
Also I never include property value in any NAV calcs, we have to live somewhere, but also we don't plan to move for a while anyway.
If you are earning similar salaries then you will both likely end up higher rate taxpayers with your pensions anyway, so the gain is the tax free growth. You are both young and tax treatment of ISAs and SIPPs is likely to change several times in your lifetime, but you might find a SIPP untouchable until you are 60.
For unsheltered assets you are apparently avoiding Accumulation units, which is good, but also for simplicity try and use UK domiciled investments rather then Ireland or US based ETFs. eg HSBC FTSE All World, or FCIT, as this avoids the headache of Excess Reportable income (ERI) and generally makes CGT simpler. See here for some options
https://monevator.com/best-global-tracker-funds/
Sadly you will probably end up paying tax on unsheltered assets, so keep a spreadsheet separate and set 10 mins aside each month to update it with any purchases or sales. That way when you realise you can hold things cheaper elsewhere and transfer to a new platform, you don't have to search through years of contract notes looking for dividend autoreinvestments to work out your gains.
CGT is still lower than income tax, Berkshire Hathaway seems to perform well long term and pays no dividend.
Look at a fixed fee platform like iweb for unsheltered assets, currently free to open and only dealing fees to pay.
Paul

As Moorfield suggests - depending upon your arrangement and length of fixed term, then prioritising paying down the mortgage is a good step - some people prefer to keep a small one but I found owning the house outright was great for peace of mind. Also the rate might be 2.12%, but that is from taxed income, so you'd need to earn nearly 4% to get the same return. It also means if/when you upsize that the new loan will be lower. Also there is no guarantee that markets and interest rates will stay as they are.
Also I never include property value in any NAV calcs, we have to live somewhere, but also we don't plan to move for a while anyway.
If you are earning similar salaries then you will both likely end up higher rate taxpayers with your pensions anyway, so the gain is the tax free growth. You are both young and tax treatment of ISAs and SIPPs is likely to change several times in your lifetime, but you might find a SIPP untouchable until you are 60.
For unsheltered assets you are apparently avoiding Accumulation units, which is good, but also for simplicity try and use UK domiciled investments rather then Ireland or US based ETFs. eg HSBC FTSE All World, or FCIT, as this avoids the headache of Excess Reportable income (ERI) and generally makes CGT simpler. See here for some options
https://monevator.com/best-global-tracker-funds/
Sadly you will probably end up paying tax on unsheltered assets, so keep a spreadsheet separate and set 10 mins aside each month to update it with any purchases or sales. That way when you realise you can hold things cheaper elsewhere and transfer to a new platform, you don't have to search through years of contract notes looking for dividend autoreinvestments to work out your gains.

Look at a fixed fee platform like iweb for unsheltered assets, currently free to open and only dealing fees to pay.
Paul
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- Lemon Slice
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Re: 2025 Portfolio
I have successfully mismanaged my SIPP since the end of 2012.
If instead of trying to be clever I had simply bought VWRL over that period my SIPP would now be over twice as large as it is!
Of course there is no guarantee that this stellar performance will be repeated over the next few years.
Most of my AVC/SIPP pension contributions over the years took advantage of the 40% tax relief.
Being a pessimist I wasn't sure how long it would last but it's still going.
If instead of trying to be clever I had simply bought VWRL over that period my SIPP would now be over twice as large as it is!

Of course there is no guarantee that this stellar performance will be repeated over the next few years.

Most of my AVC/SIPP pension contributions over the years took advantage of the 40% tax relief.
Being a pessimist I wasn't sure how long it would last but it's still going.

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- Lemon Quarter
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Re: 2025 Portfolio
Well done, though generally you are way too heavy in cash and cashlikes.
No one needs £10k in premium bonds, never mind £100k.
advice would be
- Put your money to work more sensibly
- don't pay off the mortgage as its an attractive rate
- put some money into your pension, especially if you can salary sacrifice, as its more tax efficient than an ISA
- consider a LISA too
No one needs £10k in premium bonds, never mind £100k.
advice would be
- Put your money to work more sensibly
- don't pay off the mortgage as its an attractive rate
- put some money into your pension, especially if you can salary sacrifice, as its more tax efficient than an ISA
- consider a LISA too
Re: 2025 Portfolio
DrFfybes wrote:
For unsheltered assets you are apparently avoiding Accumulation units, which is good, but also for simplicity try and use UK domiciled investments rather then Ireland or US based ETFs. eg HSBC FTSE All World, or FCIT, as this avoids the headache of Excess Reportable income (ERI) and generally makes CGT simpler. See here for some options
https://monevator.com/best-global-tracker-funds/
Sadly you will probably end up paying tax on unsheltered assets, so keep a spreadsheet separate and set 10 mins aside each month to update it with any purchases or sales. That way when you realise you can hold things cheaper elsewhere and transfer to a new platform, you don't have to search through years of contract notes looking for dividend autoreinvestments to work out your gains.CGT is still lower than income tax, Berkshire Hathaway seems to perform well long term and pays no dividend.
Look at a fixed fee platform like iweb for unsheltered assets, currently free to open and only dealing fees to pay.
Paul
For GIA was looking at iweb which is currently seems the best option with very reasonable fee structure.
Looking at UK domiciled funds to avoid ERI - borh HSBC FTSE All World Index Class C - Income (GBP) (charge 0.13% and historic yield 1.55%) and Vanguard FTSE Global All Cap Index Fund (charge 0.23% historic yield 1.51%) seem suitable options. Selling in March of each year pre-new tax year and changing to the other fund to keep in the market.
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- Lemon Quarter
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Re: 2025 Portfolio
mark85 wrote:For GIA was looking at iweb which is currently seems the best option with very reasonable fee structure.
Looking at UK domiciled funds to avoid ERI - borh HSBC FTSE All World Index Class C - Income (GBP) (charge 0.13% and historic yield 1.55%) and Vanguard FTSE Global All Cap Index Fund (charge 0.23% historic yield 1.51%) seem suitable options. Selling in March of each year pre-new tax year and changing to the other fund to keep in the market.
Very similar here - I have Iweb (GIA) and ii (GIA, ISA, SIPP), 'just in case' one has issues. If you both use the same platform then generally spousal transfers are very easy.
vand makes a good point about your cash level, which didn't seem high to me at first glance as I'm retired so keeping £100k in PBs is our 'buffer'. Long term your PBs should return more in a GIA, so unless you have a target for the cash or your employment prospects are at risk (certainly doesn't sound like it given your field) then reducing this makes sense. If you intend to use it for upsizing the house then that is a different matter as you might find it worth less when you need it.
As for the mortgage, in my 30s I split between investing and mortgage payments skewing towards the latter. However back then mortgage rates were around 5-8% and had been double that not too long previously so the fear of a sudden rate rise was not far from our minds. We were brought up to believe credit was bad so our choice has always been to avoid debt, and if I couldn't afford something, I didn't buy it. That approach is now regarded as rather old fashioned, but be aware that effectively you are borrowing against your home in order to invest elsewhere.
Whatever your choices you are on the right track, and apparently hitting 30 this year you are well ahead of where most people your age are in terms of income, assets and approach. Given the security of your DB pensions then you can also afford to take more risks - ie more in equities and just a small cash buffer. Our DB pensions cover the basics so we are over 90% in equities now the building works are finished.
Paul
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- Lemon Quarter
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Re: 2025 Portfolio
mark85 wrote:Wondering how people balance potential higher returns with investing outside tax shelter with CGT/dividend allowance so low v keeping premium bonds/cash.
First can I unequivocally agree with the posts so far.
However, in addition can I recommend a 1-2% holding in bitcoin.
No don't ignore the other posts. Traditional investments and paying off mortgage debt are without a doubt good ideas.
As you research portfolio construction you will find articles about CAPM, which argue that improved returns can be achieved without significantly increasing risks by mixing assets with different risk and reward profiles. The default mix is the 60/40 index tracker/bonds portfolio. Some mix in a bit of gold, a bit of emerging market, but you get the idea.
A tiny amount of bitcoin can IMHO significantly improve a portfolio. Why quote your CGT sentence? Well bitcoin is subject to CGT in the UK and you will have to manage things, crystalizing amounts each year so as to mitigate the tax bill. You will also have to regularly do the calculation, even if the gains are such that there is no need to submit a return or pay tax.
I'd also recommend that if you do decide to buy bitcoin, that you spend some time finding out how to secure it. Leaving it on an exchange historically has proven to be a really bad idea.
FWIW, my portfolio currently has 1.3% in BTC.
The Nokamoto Portfolio website will allow you to back test the idea with well known portfolios and provide other research tools and ideas related to BTC.
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- Lemon Slice
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Re: 2025 Portfolio
Agree with paying off the big debts as they are a running sore. It's bad enough borrowing for a car these days never mind a house with a high loan to value ratio.
For my taxable investments I have started using low interest, short dated gilts.
I currently have an investment in a GILT, TN25; 1/4% Treasury Gilt 2025.
Note there is only a 0.25% coupon in this GILT but the income is running the GILT to term and is derived from the price paid and the maturity value. There is no Capital Gains Gains Tax (CGT) to be paid on a GILT so my strategy is to achieve a safe effective interest rate with little tax to pay.
My marginal rate is engineered to be 20% maximum therefore tax paid / annum is only 20% of 0.25%
You can see the list of GILTS here
https://www.dividenddata.co.uk/uk-gilts-prices-yields.py
From here you can pick out the list of short term low interest devices. If you click on the "+" at the end of the lines you can see the calculations of what you would receive. You can easily calculate your tax liability.
Note I am no expert, its thanks to the fellow members of this forum this little extra was brought to my attention.
midgesgalore
For my taxable investments I have started using low interest, short dated gilts.
I currently have an investment in a GILT, TN25; 1/4% Treasury Gilt 2025.
Note there is only a 0.25% coupon in this GILT but the income is running the GILT to term and is derived from the price paid and the maturity value. There is no Capital Gains Gains Tax (CGT) to be paid on a GILT so my strategy is to achieve a safe effective interest rate with little tax to pay.
My marginal rate is engineered to be 20% maximum therefore tax paid / annum is only 20% of 0.25%
You can see the list of GILTS here
https://www.dividenddata.co.uk/uk-gilts-prices-yields.py
From here you can pick out the list of short term low interest devices. If you click on the "+" at the end of the lines you can see the calculations of what you would receive. You can easily calculate your tax liability.
Note I am no expert, its thanks to the fellow members of this forum this little extra was brought to my attention.
midgesgalore
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- Lemon Half
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Re: 2025 Portfolio
NHS pension.
Have you looked into buying " added years"? .....I don't know if this is allowed but unless you are planning to work until your normal retirement date, buying added years might be attractive.
Have you looked into buying " added years"? .....I don't know if this is allowed but unless you are planning to work until your normal retirement date, buying added years might be attractive.
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