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Neil Windsor
Posted: 21 February 2023 11:30:06(UTC)
#1

Joined: 31/12/2020(UTC)
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I wonder if you can help, I messaged last year as a complete newbie, wanting to set up ISA's for my wife, myself and my little one, minimum investment time for wife is x20-25 years, myself is 22 years, my little one is 12 years (but hoping given my brief discussion around compound interest means he'll invest for longer).

Similar investments for all three (I appreciate chicken feed compared to you guys, but we all need to start somewhere), i.e. £1,500 per ISA initial investment and £100 per month into each (no debts and this is affordable from my disposable income).

At the moment given the small size of the portfolios, I'd ideally want to use HL as a platform, simply because I can manage all three accounts from the app and is simple, easy and user friendly. Platform cost at present are low, however, as the portfolios grow I may look to transfer to II or Vanguard in the longer term. To avoid trading fees at this low level, I'm looking solely at funds and in particular global funds. Given the long-term I'll be investing in I'm relatively risk tolerant.

Last year I was building some elaborate managed fund strategy which was obviously ridiculous and in the end got that confused I didn't invest in anything.

Going to change that whilst I'm off this week, just need to confirm what I'm investing in. Just want one fund per account.

If you were starting out today with the above, what three funds would you invest in, would you go passive or active, or a mix?? Do I use a simple tracker for all three such as the Vanguard Global All Cap, L&G 100 Index, or start building a position in an active managed fund i.e. Fundsmith, Blackrock Global Unconstrained, Royal London Global Equity etc

My other alternative is to use Vanguard (although I don't find their platform particularly user friendly) and invest in 1. Global All-Cap (son), 2. Vanguard Global Equity (me) and Vanguard Managed ISA (wife), which seems simple and straight forward, with cheap fees.

I'd be interested in what you would do if you were starting from scratch.
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Jesse M
Posted: 21 February 2023 11:50:08(UTC)
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Well done for starting early I wish I had and I probably would've have chosen a simple tracker with that horizon as active managers can have their day in the sun but can fall out of favour and fail (Baillie Gifford anyone), so it depends if you want to be an active investor or set and forget.

Not answering your question but considering your long horizon I thought you might like the link below.

https://www.ii.co.uk/ana...sa-millionaire-ii526991

Or Google: 'interactive investor - simple maths can make you isa millionaire' if you prefer not to click on the link.


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Chalky W
Posted: 21 February 2023 12:00:07(UTC)
#3

Joined: 02/01/2020(UTC)
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NEVER underestimate the value of what you currently consider to be 'chicken feed'!

I'm in the process of assisting some family members put together their own portfolios.
Some have investing horizons of 10-20 years, others have 30-40 years+.
All of them are beginning with £1k to £5k, which is 'big money' for them.

I don't think I'm wrong in suggesting that they start with a generic global tracker.
HSBC FTSE World Index seems to have the lowest fees, but L&G International Index and Fidelity World Index all do much the same thing albeit with different tilts towards the Uk and to emerging markets etc.

Will an active portfolio beat it over 10+ years.
Probably...if you have the time/knowledge/skills/luck to navigate the waters.
Will it turn their initial investment into more money...well, if it doesn't then something drastic will have happened to the economy which we probably can't guard against anyway.

I think that a 'bog standard' tracker portfolio, by not needing any 'tinkering', is less likely to be 'tinkered with' and is thereby less likely to be screwed up by someone.
If any of them become deeply interested in 'investing' then they can earn their stripes by working with spare monies around the edges...just don't mess with the core tracker!!!! :)
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Raj K
Posted: 21 February 2023 12:02:21(UTC)
#4

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If i started from scratch and i had a wife and a child I would just put it in the Vanguard Global All Cap fund for each of them. Simple, if anytthing were to happend to me, the dependants could carry on with the portoflio .

For myself i would invest half in the same passive fund and then have a bit of fun with the other half choosing active vehicles that i think can beat the market....i like concentrated funds and the Warren Buffett quality company at a fair price philosophy so the usual suspects like Fundsmith, Lindsell Train Global Equity, Smithson Investment Trust would all have a shot of being in there. Maybe for yourself you can split 50/50% between passive and one other active fund!

Also have you looked at the charges of AJ BELL, for my smaller SIPP portfolio (which contains funds, Investment Trusts and ETF's) it is cheaper than HL and even Interactive Investor, that is until it reaches a certain size.
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Wayne Hurdman
Posted: 21 February 2023 12:30:58(UTC)
#5

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Pick your risk level for yourself and wife and then something simple like a VLS60. Leave it alone.
Fidelity Index World for your kids.

Job done.
Go for a pint.
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The Pink Panther
Posted: 21 February 2023 12:33:31(UTC)
#6

Joined: 09/01/2023(UTC)
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When you’re starting out, every penny of investing cost saved counts, so I’d recommend you all tee off with Vanguard's platform and go passive. Free investing, platform fee of 0.15%.

The last thing you want is to look at below passive losses from an active fund to put you off investing. I’d also argue you don’t want an app to begin with. Less distraction, less looking. As for funds, any global equity offering (i.e., VWRL or All Cap) or high equity multi-asset (i.e., LS80) would be just the ticket.
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Thrugelmir
Posted: 21 February 2023 12:37:14(UTC)
#7

Joined: 01/06/2012(UTC)
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At ground level. I'd start with a fund from the VLS range or something similar. Whatever fits your profile. Needs to be broadly diversified and require the minimum of tinkering.

You've plenty of time ahead of you to read, watch, listen and experience. Good investing is like watching paint dry. It's not the day at the races that social media often portrays.

Until you've a six figure sum portfolio one core fund should suffice. As within that you'll have exposure to thousands of different investments.
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xxd09
Posted: 21 February 2023 13:02:17(UTC)
#8

Joined: 23/01/2012(UTC)
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Well done for starting so early
I am a long way down the line (76) with 3 kids and 8 grand kids
So- I would fill both you and your wives ISA and Pensions first plus an emergency fund before putting any savings in a child’s name
Kids are expensive and they don’t need money as such -they need you and your time-time can cost money-wife’s time off work?
Personally I think money for children should be spent by you in educating them as well as possible -music lessons and tutoring can be expensive!- so they can be independent in due course and earn their own living
You might have to pay for them till they are 22-ie finished a uni course!
Keep all your money under your control
A global equity index tracker is just the ticket initially-Vanguard has some good funds
Simple low cost and easy to understand
Monevator.com has a comparison chart for investment platforms
xxd09
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Keith Cobby
Posted: 21 February 2023 13:33:30(UTC)
#10

Joined: 07/03/2012(UTC)
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I take a contrary view about savings for children and think they should absolutely be in their names. If this is money for them, then put it beyond your reach. Probably all replies will suggest the same course of action, to invest in a (Vanguard) tracker. An alternative, which is what I have done, is to invest in a large global IT. I chose FCIT which is currently managed by Columbia Threadneedle. They provide accounts which have a flat rate annual account fee but with no dealing costs.
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Sara G
Posted: 21 February 2023 13:52:39(UTC)
#11

Joined: 07/05/2015(UTC)
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I'm an active investor myself, but in your shoes - just starting out, long time horizon, busy family life, I would definitely keep things simple and cheap by following the advice above and then just read around the subject as much as you can or want to.

Also, if you aren't planning on tinkering too much (which you shouldn't, at least not in the early years), then the fact that the HL app and site are so user-friendly, may actually be a disadvantage, as you will be tempted to check your portfolios more often. In particular don't set up the fingerprint access on the app. I have fallen into that trap and definitely look more often than I should ;).

Best of luck
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