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Making it safe
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- Lemon Slice
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Making it safe
Put me right here please. I have mutual funds/ETFs in SIPPs (HL and AJ Bell). All are equities. Should I decide to end the risk that these pose, can I sell the funds and place the cash in a secure risk-free interest account within the SIPP?
If not, would I be right that single bonds would be the best way to go? - assuming HMG does not go bust!
If not, would I be right that single bonds would be the best way to go? - assuming HMG does not go bust!
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- Lemon Half
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Re: Making it safe
Oggy wrote:Put me right here please. I have mutual funds/ETFs in SIPPs (HL and AJ Bell). All are equities. Should I decide to end the risk that these pose, can I sell the funds and place the cash in a secure risk-free interest account within the SIPP?
If not, would I be right that single bonds would be the best way to go? - assuming HMG does not go bust!
My personal view is that now is not the time to be investing in gilts, although the prospect of falling interest rates may allow some gains. Maybe your SIPP providers pays interest on cash balances?
Having said that, gilts selling below par value do offer the prospect of some capital gains if held to maturity, or until they rise above par.
It depends on what your funds are invested in, of course. The market may be about to soar, or it may not. Oh for a crystal ball.
TJH
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- Lemon Half
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Re: Making it safe
Oggy wrote:, can I sell the funds and place the cash in a secure risk-free interest account within the SIPP?
You need to investigate what options your SIPP provider gives you for holding cash inside SIPPs. It should be in the terms and conditions.
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- Lemon Quarter
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Re: Making it safe
It is meaningless to ask that question. It all depends on your personal circumstances, and your tolerance for risk.
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- Lemon Half
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Re: Making it safe
Oggy wrote:Put me right here please. I have mutual funds/ETFs in SIPPs (HL and AJ Bell). All are equities. Should I decide to end the risk that these pose, can I sell the funds and place the cash in a secure risk-free interest account within the SIPP?
The simple answer is yes. These are the AJBell interest rates:
Code: Select all
Cash held in a SIPP or Junior SIPP
Cash balance Gross interest rate for this tier only
£0–£10,000 3.20%
Above £10,000 3.70%
https://www.ajbell.co.uk/charges-and-ra ... rest-rates
Scott.
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- Lemon Slice
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Re: Making it safe
"Safe" for when? If you want cash that will have predictable buying power in the future, index-linked gilts held to maturity would seem the safest option, since their maturity value, and interest payments, will go up in line with inflation. There are 10 gilts with maturity dates between March 2026 and November 2037: https://www.yieldgimp.com/index-linked-gilt-yields
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- Lemon Slice
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Re: Making it safe
The simple answer is yes. These are the AJBell interest rates:
CODE: SELECT ALL
Cash held in a SIPP or Junior SIPP
Cash balance Gross interest rate for this tier only
£0–£10,000 3.20%
Above £10,000 3.70%
https://www.ajbell.co.uk/charges-and-ra ... rest-rates
Scott
Excellent answer - thanks.
Safe" for when? If you want cash that will have predictable buying power in the future, index-linked gilts held to maturity would seem the safest option, since their maturity value, and interest payments, will go up in line with inflation. There are 10 gilts with maturity dates between March 2026 and November 2037: https://www.yieldgimp.com/index-linked-gilt-yields
Another good one - many thanks.
My global tracker portfolio - with a bit of US bias in the form of S&P500 trackers - does seem to be doing rather well of late. I just need an option of a safe house for some or even all of it come the time. I have not drawn upon any of it just yet - still in employment.
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- Lemon Slice
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Re: Making it safe
Oggy wrote:The simple answer is yes. These are the AJBell interest rates:
CODE: SELECT ALL
Cash held in a SIPP or Junior SIPP
Cash balance Gross interest rate for this tier only
£0–£10,000 3.20%
Above £10,000 3.70%
https://www.ajbell.co.uk/charges-and-ra ... rest-rates
Scott
Excellent answer - thanks.Safe" for when? If you want cash that will have predictable buying power in the future, index-linked gilts held to maturity would seem the safest option, since their maturity value, and interest payments, will go up in line with inflation. There are 10 gilts with maturity dates between March 2026 and November 2037: https://www.yieldgimp.com/index-linked-gilt-yields
Another good one - many thanks.
My global tracker portfolio - with a bit of US bias in the form of S&P500 trackers - does seem to be doing rather well of late. I just need an option of a safe house for some or even all of it come the time. I have not drawn upon any of it just yet - still in employment.
Have you considered moving to something like Vanguards Life Strategy Funds choosing the equity to bond ratio which suits your risk profile. HSBC's Balanced fund and L&G's Multi Asset Fund do a similar job.
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- Lemon Slice
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Re: Making it safe
AJBell has a list of tradeable GILTs
https://www.ajbell.co.uk/our-services/i ... lts/prices.
I use some that are low priced and near completion to get 4% + on cash I will need short/medium term.
Work out the real yield here
https://www.dividenddata.co.uk/bond-yield-calculator.py
https://www.ajbell.co.uk/our-services/i ... lts/prices.
I use some that are low priced and near completion to get 4% + on cash I will need short/medium term.
Work out the real yield here
https://www.dividenddata.co.uk/bond-yield-calculator.py
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