Investing for retirement

[madameimadam]

Am an absolute novice so thought I’d get some advice here from people who know more about!!

Am 50 - have a pretty decent pension & thinking of retiring probs in ten years or so if I can.

Due to inheritance, I’m now in the position of being able to pay off my mortgage & outstanding debts leaving me with money to invest. I’d like to start saving some of the money I would have previously paid for my mortgage into a Stocks & Shares ISA so roughly £1000 per month. Happy to leave as a long term investment so won’t need to withdraw this money at any point.

What platform would you advise? I’m veering towards Vanguard or Trading 212 as a starting point but are there any others I should consider? Are there any other fundamental things that I should think about (eg. global investments vs more UK)?

Thankyou…

Either vanguard or T212 are fine. Both low/no fees. Vanguard has a phone number to speak to a human. That's a plus for me!

Everyone will have a different approach depending how they view risk and volatility and how long they expect to leave the money invested for.

I use a global tracker for the majority of my money. But that is currently very heavily weighted to the US, which has been great over the past few years, but the AI bubble concerns me. I prefer more global diversity and more business size/opportunity diversity. So I also have a little invested in a UK all caps tracker; in a global emerging markets fund; in a Japan tracker; in an Asia exc Japan small caps fund; and about 10% in a special situations fund, which has done really well for me.

T212 will cost you less, but you may or may not like their interface. Vanguard Investor website is easy to use, costs more (£4 per month minimum fee for portfolios under £32k).

Could have both - track your use of ISA so you don’t over contribute.
Freetrade is another to consider.

Keep it as simple as you can. A global fund or a multi-asset fund. You don’t need lots of funds, just pick one.

Some YouTube channels which may help:
RebelDonegans - Rebel Finance School
Meaningful Money
Damien Talks Money

If you prefer books:
The Meaningful Money Retirement Guide - Pete Matthew
The Simple Path To Wealth - JL Collins

Vanguard probably isn't the best long term choice, but it's good for a beginner because it has the phone helpline, a reasonably simple interface, and a limited number of funds so you don't get overwhelmed by choices.

If you want to switch later it's very easy to move platforms, and in the run-up to the end of the financial year there are usually cash incentives for doing so.

Why do you say Vanguard isn't the best long term?

Because of the limited fund choice, and because their fees aren't as competitive as they used to be.

I transferred my investments and My SIPP pension from Vanguard to Interactive investor , wider choice of investments and less fees !

Vanguard only offers Vanguard funds, it was great initially but as I became more confident I wanted a wider choice of investments and more competitive fee structure as my pot grew.

I did the same - I prefer the ii software too.

I have everything with T212. I would strongly recommend researching whether a S&S ISA or SIPP would be the better option. Have a look at Rebel Finance School on YouTube as they cover this. Using a SIPP might be beneficial if you are a higher rate tax payer.

AJ Bell are very good too.
Like the first poster said, your biggest decision is whether to use a global tracker ETF which will have lots of US and particularly tech/AI exposure. If you think these may be due a slowdown or correction, you could choose a global ex US ETF.
Personally I’ve got probably 75% or so in the US.
Also yes, definitely research whether to use ISA or SIPP.

Max out your pension from your salary or start a sipp of you have a db pension. Get the tax relief on that. Live off your inheritance to make up for the shortfall in your salary.

Fidelity are great

I used T212 and everything is very simple. I have picked my own investments and they have made over 22 percent over last 2 years but this year I have diversified a little. I put £20k each year into a stocks and shares ISA. T212 also do SIPPs so you can keep everything in one place.

Please can PPs elaborate on whether you need to choose a SIPP or a stocks ISA? Other than the tax relief what else would need to be factored in? Why not have both?

I’ve just looked into all of this and went with AJ Bell. They have a specific retirement fund / SIPP and you can choose low risk, moderate risk or higher risk. I’m the same age as you OP but have gone for moderate risk and hopefully higher growth than the low risk one as I have a decent work pension. With the SIPP you get your tax back.

people talk about t212 being cheaper but they are less transparent on their charges and have a higher spread apparently so you end up paying the same but via a different method. I’m no expert and had to keep googling to get my head round it but think I understood it enough to decide a j bell were the better option. They have a very good proven track history of performing well which was important to me,

I have a stocks and shares with vanguard as well and to be honest I find their online platform difficult to deal with. A j bell seems more user friendly to me.

i do have a code I can share with you if you did want to open an account with them. Think we both get some money then. I only opened mine a few weeks ago so far to early to comment how it’s doing.

My stocks and shares fidelity isa went from being valued at 17k to being valued at 12k over the last few years. So I have moved it to vanguard. It’s done nothing but steadily lose money over the last 15 years!

What are you invested in? Fidelity and Vanguard have a massive range of funds. If you were invested in a simple tracker over the last 10 years it should have returned on average about 12% annually.

ii are pretty good IMO - far cheaper than Hargreaves

These have all performed very well for me over the last 7 years:

Artemis Global Income
iShares core MSCI World ETF
L&G US index

Fidelty

Another vote for ii. Fees are very reasonable especially for larger amounts, interface is good, range of funds is excellent and you can hold gilts individually.

It does depend on the size of your SIPP - ii are better for larger Sipps as they have a fixed fee of £5.99 not a 0.25%. AI suggests the cross over can be as low as £28,000. I haven't done the calculation - I know AJ Bell are expensive - I don't know what their software is like. I'm still using Lightyear to diversify cash via their money market fund and I'm still finding their software to be very straightforward - compared to Invest Engine and Vanguard.

No idea. I inherited it and didn’t look at it for years. Was originally a legal and general account but they sold it to Fidelity 🤷🏻‍♀️

Have a look at Rebel Finance School…free on YT and FB.

Changing platform/ provider won’t make any difference to the performance. You really need to look at the underlying funds. Global trackers have performed well over the last 15 years so you should definitely check what it is.

With vanguard it’s just a managed stocks and shares isa. Which is what it was with fidelity. But I assume different companies invest in different stocks. So some perform better than others. Have just logged into vanguard and it’s grown nearly 9% in the last year. So doing lots better than fidelity ever did.