ISA’s

[Nanu]

Nanu, both times?

[DevonPaul]

Yes I have

We have a financial advisor & have done for several years - put in a monthly amount & generally see a steady increase

As Covid really hit in 2020 & went into lockdown 1 I lost 7k quickly.
This was recouped once the company started trading again & share prices bounced back - I would say it took a couple of months maybe three to return - I could check but you get my point

Since February (Russia’s invasion) I have noticed that my investment is not really growing at all even though my £400 per month is still being ploughed in

Firstly, how much of your £400 actually goes into investments each month, does your advisor take 1%, 3%, or 5% of each contribution, and/or an annual fee of the value? We have a friend who uses Ken Fisher, raves about them, has had 7% pa for the last decade after their 3% fee. He seemed disappointed when I pointed out my Vanguard tracker returned 10-11% pa for the last decade, but without the 3% fee removed. He paid nearly £250k in fees over that time! I pay £240/year to my platform and 0.09% OCF.

Any reason you're putting it into an ISA rather than getting the tax relief from a SIPP?

Now I have used an advisor, and quite recently when I stopped work. However it was a fixed fee, to review where I was at, and whther I was being realistic with my goals, and he made some suggestions I had not thought of that were blatantly obvious but we'd missed as we'd got a bit of tunnel vision on our approach.

As for this year, lwe ost 6% between Jan and Aug, but it has all come back in the last 6 weeks. I'm heading towards roughly 80% in VEVE (Vanguard Devloped World Tracker ETF as the fees are slightly lower than the Fund equivalent), 10% in BRK.B for excitement, and the rest in some odds and sods I buy and sell for a bit of fun.

To put this into perspective, I no longer work and live on investment income, ISA, SIPP, and unsheltered. I draw about 4% pa from my portfolio (although actually all of it is drawn from the unsheltered bit, no pooint in taking money OUT of ISAs and pensions until you need to - one of the really obvious things the advisor pointed out), and on a volatile week it can rise or fall by several months income. On Brexit vote day i was still working and my investments dropped by about 12 months' take home salary. In one day. It was hit early 2020 too, but not as badly, and in both cases has bounced back.

I don't think this will continue, trackers have done very well recently and going forwards I suspect a diversification into property or metals might be of benefit, but the one thing I learnt late last century for the dear old Motley Fool is that paying someone else to look after your money only helps one person get richer.

Paul

[PointedMarlin]

Really good questions Paul, which tells me I’ve become lazy, or complacent, or naive or all of the above

I suspect we could make our money make us more money for sure but I don’t know at what cost that might be in terms of Risk vs Reward or finding other companies and I’m happy with what service we get

Is it possible ignorance is bliss - for me right now yes I suppose so

But thanks for your input as it will help me at our next review meeting to find out why we are in the portfolios we are in re: ISA vs SIPP

I know I’ve not paid out 250k in fees though so am in a better position than your friend

[DevonPaul]

But thanks for your input as it will help me at our next review meeting to find out why we are in the portfolios we are in re: ISA vs SIPP

I know I’ve not paid out 250k in fees though so am in a better position than your friend

Maybe not, but my friend's portfolio is about £1M. However starting from zero, £400/month or £4800 added each year growing at 10% would roughly return £60k after a decade. With fees at 1% that drops to £57K, at 3% it is £51k and at 5% it is £46k.

Nearly all managed funds underperform the market, then there are platform fees. At the review ask them to benchmark their performance against a Global Tracker for Total Return, and their platform (probably Old Mutual/Quilter) against Vanguard's 0.15% platform fee. And if you're using St James' Place then you should really really look at moving - they made nearly £1Bn in income last year from their investors. Self managing is really very simple to set up and you can probably get a comparable fund for a lot less elsewhere.

Paul

[M1k3yC]

Now I have used an advisor, and quite recently when I stopped work. However it was a fixed fee, to review where I was at, and whther I was being realistic with my goals, and he made some suggestions I had not thought of that were blatantly obvious but we'd missed as we'd got a bit of tunnel vision on our approach.

Hi Paul

This is the sort of thing I'm looking for from an advisor. Do you mind me asking who you used? I've got a short shortlist, but finding fixed fee (vs. percentage of total assets) can be tricky. Feel free to PM if you don't want to publicly recommend a firm.

This is probably a good time to mention that I get a lot of value from talking to other investors via the SIGnet (part of ShareSoc) group. They might be useful to you or anyone else that is self managing investments. See: https://www.sharesoc.org/signet/ I can put you in touch with the meetings coordinator if it's of real interest.

Mike

[DevonPaul]

Mikey - pm sent