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I need some help navigating: So, I have saved some money I don't intend to touch for a while and opened up a S&S ISA (I don't have plans for buying a home in the UK, at least for now) and from my initial research (mainly googling and reddit) I have found two names for "passive/fire and forget" investment: FTSE 100 (Class C) and Vanguard S&P 500 UCITS ETF USD. The Barclays ISA UI is clunky as gently caress and does not show history etc. Any help (or yell at me for being dumdum)?
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Jan 26, 2021 22:07
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Galewolf posted:I need some help navigating: Who runs those two funds and what are their annual costs?
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Jan 27, 2021 08:57
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First one is (this is also recommended by the investing websites in the UK) VUSA, ran by Vanguard: Vanguard S&P 500 UCITS ETF USD https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0000WAHG The S&P is ran by HSBC: https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/h/hsbc-ftse-100-index-class-c-accumulation
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Jan 27, 2021 10:18
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Galewolf posted:First one is (this is also recommended by the investing websites in the UK) HSBC one is much more expensive than the Vanguard one (0.18% vs 0.07% p/a), but both are plenty cheap imo. I'd be wary investing in a fund that is not denominated or hedged back to Sterling, personally. That Vanguard one appears to be based in USD. It's probably not that big of a deal to most people, but if you want to cash in the fund you'll be at the mercy of GBP:USD exchange rates and Sterling has looked like dogshit since 2016. You can interpret that as 'it can only go back up' or you can wonder just how bad Brexit can get when it comes to our esteemed leaders negotiating trade deals.
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Jan 27, 2021 11:03
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Theophany posted:HSBC one is much more expensive than the Vanguard one (0.18% vs 0.07% p/a), but both are plenty cheap imo. Been very tempted to get one like that Vanguard one as well for the past few months but haven't committed. I thought that having the USD based one would be of benefit if the GBP kept losing relative value (was wanting something for 14 years duration). Faulty logic on my part? edit for grammar
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Jan 27, 2021 12:06
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Just Another Lurker posted:Been very tempted to get one like that Vanguard one as well for the past few months but haven't committed. It's not faulty logic at all, your thinking is spot on, it's just a big bet that I would personally be uncomfortable with. If you go back 15 years, £1 got you $1.77. Today your £1 gets you just $1.37. If we assume that Brexit has been fully priced into currency markets (and you could reasonable reach that assumption as Sterling tanked the day after the referendum and has trended around that level ever since), it would be more likely to return to historically normal levels over the medium-to-long term. It's purely speculation as to which way the direction of travel is in forex markets, but it's an additional and ultimately leveraged level of risk that you should be aware of and comfortable with. You could win big with that additional risk, it could also end up eating into your potential returns when you come to cash in your investment. 
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Jan 27, 2021 14:02
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Theophany posted:It's not faulty logic at all, your thinking is spot on, it's just a big bet that I would personally be uncomfortable with. If you go back 15 years, £1 got you $1.77. Today your £1 gets you just $1.37. If we assume that Brexit has been fully priced into currency markets (and you could reasonable reach that assumption as Sterling tanked the day after the referendum and has trended around that level ever since), it would be more likely to return to historically normal levels over the medium-to-long term. Thanks for the info.
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Jan 27, 2021 14:32
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Theophany posted:HSBC one is much more expensive than the Vanguard one (0.18% vs 0.07% p/a), but both are plenty cheap imo. Thank you very much for the reply, I'll definitely put more work into doing my research and will post here if I have more questions. I think Barclays also trade Sterling-backed Vanguard one but they have like seventy-odd different ones so some reading is due. I want to keep my Barclays account compact as much as I can because I might move out of UK and want to keep things in one place.
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Jan 27, 2021 22:40
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I figure I can pop in a quick question here: I'm moved to London 2 years ago and I've built up some savings that I want to invest. Basically, the question is through what institution. Back home, I simply invested through my bank for historical reasons, but two new institutions had popped up specifically for stock trading (Saxobank / Nordnet). Here, I'm tempted to simply do it through Barclays and keep it all in my bank as well, but I see tons of financial adverts in the tube and if someone here has an overview that one of these choices is clearly cheaper/easier, then I'd like to draw on that knowledge before I default to Barclays. (Mainly, I'm looking to buy and hold an index or some selected stocks.) Thanks in advance, I hope this is within the scope of the thread. Aeble fucked around with this message at 10:26 on Jan 29, 2021 |
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Jan 29, 2021 10:19
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Theophany posted:HSBC one is much more expensive than the Vanguard one (0.18% vs 0.07% p/a), but both are plenty cheap imo. Hang on, does this really matter for a fund like VUSA where it’s based on US equities though? You’re exposed to the currency rate either way?
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Jan 29, 2021 10:36
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Aeble posted:I figure I can pop in a quick question here: I'm moved to London 2 years ago and I've built up some savings that I want to invest. Basically, the question is through what institution. Back home, I simply invested through my bank for historical reasons, but two new institutions had popped up specifically for stock trading (Saxobank / Nordnet). Here, I'm tempted to simply do it through Barclays and keep it all in my bank as well, but I see tons of financial adverts in the tube and if someone here has an overview that one of these choices is clearly cheaper/easier, then I'd like to draw on that knowledge before I default to Barclays. (Mainly, I'm looking to buy and hold an index or some selected stocks.) There’s a few things which might affect this. Are you eligible to invest within an ISA, or is this just a standard investment account you’re looking for? Your cheapest platform for fees will depend on how much you’re looking to invest. monevator has a good list of brokers with their fees, generally with smaller amounts you’re best off with % based brokers and with larger amounts go with flat rate. Barclays are on that list so you can compare for your purposes. Fwiw I use iWeb, but they have just put their account opening fee up, so it might be less competitive now.
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Jan 29, 2021 10:45
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Pantsmaster Bill posted:There’s a few things which might affect this. Are you eligible to invest within an ISA, or is this just a standard investment account you’re looking for? I'm not 100% sure what the ISA is - going by https://www.gov.uk/individual-savings-accounts, being a resident of the UK seems to be enough. It does not detail permanent resident status (which I do not have), so I assume that living here with my presettled status is sufficient. In that case, I think I can get an ISA. (I understand that it saves you tax?) I've got around 10.000 pounds to invest atm. A minor consideration is that I'll likely leave the country in a year or two. (So far I've been holding off on investing due to expecting a crash, but since the market is apparently entirely decoupled from the real world there doesn't seem to be a reason to leave funds in the bank for no interest.) Thanks for the link! Aeble fucked around with this message at 12:39 on Jan 30, 2021 |
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Jan 30, 2021 12:19
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Aeble posted:I'm not 100% sure what the ISA is - going by https://www.gov.uk/individual-savings-accounts, being a resident of the UK seems to be enough. It does not detail permanent resident status (which I do not have), so I assume that living here with my presettled status is sufficient. In that case, I think I can get an ISA. (I understand that it saves you tax?) You have to be a 'resident' according to HMRC's statutory residence test for the tax year in which you're putting in money (basically if you spend more than half of the year physically living in the country then you're good). Once you leave the country you can no longer put in new deposits but can retain an existing account - although I have to admit I'm not sure how this works for foreign nationals who are, like, leaving the country for good...
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Jan 31, 2021 14:38
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Pantsmaster Bill posted:Hang on, does this really matter for a fund like VUSA where it’s based on US equities though? You’re exposed to the currency rate either way? If the fund is hedged back to Sterling it'll be investing in instruments to hedge out the currency difference as best it can. It can work in your favour depending on the direction of FX travel, but equally it can work against you and it is sensible to be aware of that risk and deciding whether or not you are comfortable with it.. This explains it quite neatly: https://www.finder.com.au/hedged-vs-unhedged-etfs Where I used to work we hedged our funds back to Sterling mainly because it was a requirement for investors drawing regular income from our funds.
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Feb 1, 2021 13:01
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New Found Power posted:You have to be a 'resident' according to HMRC's statutory residence test for the tax year in which you're putting in money (basically if you spend more than half of the year physically living in the country then you're good). The fun adventures of living abroad! I guess worst thing is that I have to sell and take the taxes then and there.
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Feb 1, 2021 13:29
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I bought additional pension contributions with a lump sum for my teachers pension a few months ago. I seem to remember that this means I can claim some kind of tax relief/top up? How do I do this? The teachers pension website doesn't seem to have anything that I can find.
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Feb 4, 2021 21:26
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Sad Panda posted:I bought additional pension contributions with a lump sum for my teachers pension a few months ago. I seem to remember that this means I can claim some kind of tax relief/top up? How do I do this? The teachers pension website doesn't seem to have anything that I can find. If the lump sum came from your salary then relief would be have given at source. If you made the lump sum payment direct to the pension fund you need to claim the relief from HMRC, you can do that via your Income Tax Self-Assessment return or contact HMRC by phone/post if you don't normally fit out a tax return. Contact details are here: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/income-tax-enquiries-for-individuals-pensioners-and-employees
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Feb 4, 2021 21:39
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Your pension provider will often top up the 20% by default when you make a lump sum contribution. If you’re in the higher tax band, you will have to claim the additional relief by writing to HMRC.
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Feb 4, 2021 21:48
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Orlando Furioso posted:If the lump sum came from your salary then relief would be have given at source. If you made the lump sum payment direct to the pension fund you need to claim the relief from HMRC, you can do that via your Income Tax Self-Assessment return or contact HMRC by phone/post if you don't normally fit out a tax return. It was a lump sum payment. Thanks I'll give that link a look and work out what I need to fill in. Never filled in any tax stuff before other than that claiming some tax back for working at home this year.
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Feb 4, 2021 22:06
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Don’t think it has the material for a new thread at all really but I’d be interested to hear if there’s any Irish lurking with particularly good setups they might want to share. I’m assuming if you have a pension scheme at your work you’re already paying into that etc. We don’t really have an ISA equivalent. And if you have any money for putting into ETFs you get assessed for gains every seven years even if you held the entire time without selling,not great for the compounding. The above could well be all wrong though!
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Feb 6, 2021 09:14
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Pantsmaster Bill posted:There’s a few things which might affect this. Are you eligible to invest within an ISA, or is this just a standard investment account you’re looking for? Interesting, thanks. I've seen a few articles recommend that shares in firms that pay dividends are worth including in a portfolio. A lot seem to mention L&G (259p currently). I know we are not supposed to try to pick stocks to beat the market. But isn't a dividend-paying firm worth investing a grand or two in for the long haul (10 years or so)?
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Feb 10, 2021 15:56
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Breath Ray posted:Interesting, thanks. I've seen a few articles recommend that shares in firms that pay dividends are worth including in a portfolio. A lot seem to mention L&G (259p currently). I know we are not supposed to try to pick stocks to beat the market. But isn't a dividend-paying firm worth investing a grand or two in for the long haul (10 years or so)? Depends on the long term sustainability of the dividend over time, which is difficult to predict. It would be very easy to fall into the same rabbit hole that people do chasing returns but instead chasing dividends. Also a dividend can be used as a way to make a company's shares look more attractive than they fundamentally are. You could be holding a few grands worth of shares in a company paying a regular dividend, but if the company is underperforming and the growth + dividend is less than you could've gotten elsewhere, what is the attraction of a dividend? Real world example is a client of mine who doggedly refuses to sell their WPP shares because the dividend has historically been good. This is despite the share price having nearly halved over the last 4 years.
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Feb 10, 2021 17:14
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Theophany posted:Depends on the long term sustainability of the dividend over time, which is difficult to predict. It would be very easy to fall into the same rabbit hole that people do chasing returns but instead chasing dividends. Or in a company I worked for, they literally nearly bankrupted themselves paying out an unsustainable dividend cause lowering it would look bad.
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Feb 10, 2021 21:46
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Theophany posted:Depends on the long term sustainability of the dividend over time, which is difficult to predict. It would be very easy to fall into the same rabbit hole that people do chasing returns but instead chasing dividends. nothing's risk-free but it seems worth working out the yield and including as part of a balanced portfolio - along with japanese govies ofc  i also noticed the OP does not mention btl. is that a reflection of its deteriorating appeal or just unconscionable in this leftish space?
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Feb 11, 2021 07:32
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I'm as massive fan of all the vanguard tracker products to be honest, they make up the bulk of what I've put away, but I don't think I'd put all of my investments inside one tracker fund and one index (particularly when you can argue that the S&P 500 is maybe a bit overheated. If you don't want to invest in an fully diversified manangement fund that invests in trackers, then how I personally manage it is by spreading it across a number of difference indexes, (US/UK/EU/Emergeny Makerts/Fixed Interest). Also manages the currency risk angle a bit better if your investments are spread across different ones anyway. I don't think you risk is significantly diversified if that vanguard fund was the one thing that you were holding.
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Feb 11, 2021 11:01
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Breath Ray posted:i also noticed the OP does not mention btl. is that a reflection of its deteriorating appeal or just unconscionable in this leftish space? It's mostly because I don't have any experience in Buy-To-Let, and was originally more of a getting personal finances sorted and on the housing ladder at all type OP as it reflected my personal circumstances at the time. If you want to do an effort post detailing how much harder BTL is than Homes under the Hammer makes it look then please go ahead and will link it in the OP
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Feb 11, 2021 11:10
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Just hoping for a bit of feedback/guidance if you don't mind. I have some limited investment experience, just index funds and ETFs and a little crypto, which I sold a couple of years ago due to needing to move. It was a bad idea cos I didn't move, oh well. Currently I have £17500 in total, £12000 of which I'd like to reinvest as it's doing bugger all in my premium bonds and current account. The remaining £5500 I'll leave untouched (£2500 in PB and £3000 in CA) just to have some safety funds. I'd like to put 75% (£9000) into funds. I would then pay £200 per month into whatever index fund I go with, probably the Vanguard FTSE Global. Is it worth using multiple funds, say splitting between that index and an ETF like INRG? I appreciate that there are differences between the two types. Also, when dumping "large" amounts into a single fund is it wiser to drip it over time? Say, £1000 per week or so? The remaining 25% to be split evenly (£1000 each) between some stock picks, a SPAC or two, and cryptocurrency. I'm in no hurry so I'm prepared to do research into specific stocks/currencies and can afford to stomach the risk and volatility of this £3k, tbh the idea of this is rather appealing. I'm not expecting to get rich, just ultimately grow it a little. No interest in the WSB madness. I'm with Hargreaves Lansdown for the index funds and anything else I can't get on Freetrade, Freetrade for anything that involves dealing fees. Binance and Kraken for crypto. I pay 5% (8% with employer contribution) of my salary into a workplace pension which seems to do well, it's through TPI and in the Legal & General Multi-Index 7 Fund. Happy to leave this as it is. I have no debts other than student finance which comes out every month (non-voluntary only). I rent. Does that allocation plan sound ok? Appreciate any correction if I'm being dumb.
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Feb 11, 2021 13:12
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Breath Ray posted:i also noticed the OP does not mention btl. is that a reflection of its deteriorating appeal or just unconscionable in this leftish space? ALAB
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Feb 11, 2021 13:24
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sebzilla posted:ALAB Hell yeah Deketh: if you're happy with effectively gambling with the £2000 then yes that seems like a decent split, but be aware that's basically what's happening
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Feb 11, 2021 13:37
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Deketh posted:Just hoping for a bit of feedback/guidance if you don't mind. thanks for the tip on freetrade. what is the catch with that service? since your money isnt doing anything where it is, it seems like you may as well go for a better return by investing a large amount into a single fund, rather than dripfeeding.* (that's assuming the investment performs positively.) just be sure you're prepared to lose all of it. lastly, how much is your rent and would it be cheaper to have a mortgage where you live? when you say i sold off my investments because I was planning to move, do you mean you were putting together a deposit to buy? *if you or anyone did want to test the robo investment waters, here's a referral link to wealthify. 'For every friend that joins Wealthify and invests £500 or more for at least three months, you'll each earn a £25 boost to your investment' https://invest.wealthify.com/refer/79256764. im not a money guy, but if my calculations are correct, thats a 5% return in three months.
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Feb 11, 2021 15:43
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Doccykins posted:It's mostly because I don't have any experience in Buy-To-Let, and was originally more of a getting personal finances sorted and on the housing ladder at all type OP as it reflected my personal circumstances at the time. If you want to do an effort post detailing how much harder BTL is than Homes under the Hammer makes it look then please go ahead and will link it in the OP ah ok! im an accidental landlord, not an expert. i bought a place to live in in zone 3 then moved back to renting in zone 1 because zone 3 is boring as hell. id love to see an effort post! i spent a fortune on a place that didnt need doing up but if id been doing BTL id have bought a fixer-upper in luton (which was then the biggest house price loser of 2020 so shows my level of expertise). BTL doesnt look like a slam dunk investment these days and rishi is supposedly going to raise CGT in the budget too, but id still put it in the OP before taxable brokerage accounts whatefver they are
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Feb 11, 2021 16:08
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mfcrocker posted:Hell yeah Fair enough, yep that's understood. Thanks for taking a look. Breath Ray posted:thanks for the tip on freetrade. what is the catch with that service? Freetrade has very quick sign up and no trading fees, however they charge a monthly fee for an investment ISA. No fee for a standard account. They also have limited shares available and some are gated behind Freetrade Plus, which is another monthly fee. So it's not the best, however for what they do have available for free they're fine I think. My rent is £800, a mortgage might be cheaper but that's not a route for me currently. I wasn't putting together a deposit, I was expecting to lose my job and thinking of moving to a new area with the sold investments as a cushion. My job is secure now but I am planning to move to a cheaper place. Thanks for your reply. Deketh fucked around with this message at 16:52 on Feb 11, 2021 |
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Feb 11, 2021 16:47
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Breath Ray posted:nothing's risk-free but it seems worth working out the yield and including as part of a balanced portfolio - along with japanese govies ofc Even ignoring the ethical issues around it, it's financially questionable from a long term personal finance perspective. UK housing, especially around big cities and the South East is in a huge bubble, prices are jacked. Rent as a percentage of capital investment figures are awful these say and have always been bad in the UK. So many BTL properties have been unmaintained by cheap landlords I expect huge bills to bring them back in line in the near future. Basically, like all speculative bubbles, if you buy in now you're buying expensive, getting a low or even negative roi and are usually betting on capital appreciation, aka bubble please inflate more. Remeber that this is on expensive assets that are notoriously illiquid, doubly so in a crash, that you need massive leverage to buy. Also, assuming you own/mortgage your home you're already likely massively overexposed to the UK property market. The general UK population might believe houses are magic money printers that never go down, but they are a massive gamble right now , the fundamentals stopped making sense a decade ago and it comes with the added benefit that half of society will hate you for being involved with it. You can of course put your money where you want and I might be wrong and house prices continue to increase until every house is worth infinity pounds, but long term investing with the thread goal of sort your financial life out it is not.
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Feb 15, 2021 08:46
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The ultimate economic logic of BTL is you get exposure to the upside on (say) a £300k asset for £75k of your own capital with a a bank financing the rest. Interest rates on that finance of about 1.5% with rent yield almost certainly covering that cost and more. And the downside risk is miniscule, especially compared to what you'd have to invest in to get a similar level of leveraged returns in the stock market. Don't do it because ALAB but we unfortunately live in an economy whose basic functioning makes BTL logical. Unless you truly believe we're about to see an apocalyptic crash in prices of an essential asset, for which there is greater demand than supply, and that the entire economic might of the British state is dedicated to propping up.
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Feb 15, 2021 10:32
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I realise this puts me in line for the guillotine in the other thread but here goes: A few years when we outgrew our 1 bed flat in zone 1, it seemed sensible to borrow a little bit more against it (to afford the next place) and rent it out rather than selling up entirely. Our experience has been pretty good, full occupancy, mostly exemplary tenants, they’ve always been happy with us. However, the change to the tax laws ate 75% of the rental yield, leaving us with roughly £2000 net profit per year, and this costs 10-15 hours of effort. It’s not bad money per se, but we’ve concluded that it’s not worth the effort for us; when the market picks up for 1 bed flats we plan to sell. I suppose if you do it properly; via a limited company etc, then the numbers might work for you, but it isn’t “passive” income by any stretch of the imagination.
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Feb 15, 2021 13:03
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Dakha posted:[...] im in a similar position. but where would you put the money from the sale? the goal used to be to move up the ladder to bigger houses but if they replace council tax with annual property tax at 0.5% as has been reported that makes a little less sense
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Feb 15, 2021 18:44
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I also let out my zone 1, 1 bed flat whilst I was living in the US for a couple of years and found the whole thing to be a massive loving ball ache to the point I'd never do it again. And that was with paying the estate agents a management fee to do everything because I was on a different continent.
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Feb 15, 2021 18:51
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Breath Ray posted:im in a similar position. but where would you put the money from the sale? the goal used to be to move up the ladder to bigger houses but if they replace council tax with annual property tax at 0.5% as has been reported that makes a little less sense We’re keen to move somewhere larger and the rumoured property tax, while annoying, wouldn’t affect our choice. If we weren’t planning to move we’d probably stick the cash in an index fund for relatively similar returns and zero effort. Dakha fucked around with this message at 19:56 on Feb 15, 2021 |
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Feb 15, 2021 19:52
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I hope this is the right place to ask but following all of the recent GME stuff has gotten me interested in trying my hand at stocks (at the very least buying 1 share in GME). I've got a small bit of disposable income that i was going to ringfence as a test to see what i could gain to supplement my income. However i'm a bit unclear on where exactly to begin and, more importantly , what software to use. From my research, things like T212 or Revolut have been mentioned as platforms and each platform has different levels of access to different stocks and also subsequent restrictions on the amount of trades you can do, etc. I'm not planning to go crazy or anything, but mainly looking to see what i could gain over the course of a year from starting with an initial £1000.
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Mar 11, 2021 09:44
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Id suggest you think about your motives carefully. If this is truly disposable income and a 'bit of fun' then go for it (although I'd still say stay away from meme stocks). If you actually want to invest in your future then stick with index funds.
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Mar 11, 2021 09:59
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