Transferring a S&S ISA into a new Vanguard account

[FreeLitres]

I am looking to create a new account with Vanguard by transferring in an existing SS ISA from a different provider.

When I transfer this ISA in, does it sit unallocated when the transfer completes, or do I have to specify which investments/EFTs it will go in at the start of the process?

I would prefer to drip feed money into my chosen EFTs over a few months rather than dump it all in at the start. Is this possible on an ISA transfer?

[bitchstewie]

It's been a while since I transferred to Vanguard but from memory there was an option to have it sit as cash.

[Simpo Two]

FreeLitres said:

When I transfer this ISA in, does it sit unallocated when the transfer completes, or do I have to specify which investments/EFTs it will go in at the start of the process?

Are you transferring cash or 'in specie'? You can only hold Vanguard products on the Vanguard platform.

Have a chat with Vanguard for definitive answers to the rest; I found them very helpful.

[Kwackersaki]

Exactly what I did. A few years ago though. Transferred into cash and have been drip feeding into funds ever since.

[C69]

As already mentioned above, if any of your existing holdings are non-Vanguard funds, then you won't be able to keep them on the Vanguard platform.

Notwithstanding that, I'm curious about why you would want to encash all of your holdings now, then drip feed back into the market over a period of time.

[FreeLitres]

C69 said:

As already mentioned above, if any of your existing holdings are non-Vanguard funds, then you won't be able to keep them on the Vanguard platform.

Notwithstanding that, I'm curious about why you would want to encash all of your holdings now, then drip feed back into the market over a period of time.

I'm a complete novice in this, but I've been studying the returns of EFTs such as the S&P 500 and with all the world troubles happening I have a feeling that the market will decline significantly in the next 6 months. I understand time in the market beats timing the market, but I just don't want to dump in a lump sum just as this peak looks like it is over. I'd prefer to drip feed in to try and catch more of the rise.

Bad move then?

[YouWhat]

FreeLitres said:

I'm a complete novice in this, but I've been studying the returns of EFTs such as the S&P 500 and with all the world troubles happening I have a feeling that the market will decline significantly in the next 6 months. I understand time in the market beats timing the market, but I just don't want to dump in a lump sum just as this peak looks like it is over. I'd prefer to drip feed in to try and catch more of the rise.

Bad move then?

The most important thing I’ve learnt over the past 20yrs, is that “time in the market” matters for ISA’s and pensions.

[Phooey]

As C69 says. Just be mindful you are going to cash to then drip feed into a bull market - you are >50% likely to be buying at higher prices. The US economy is doing ok, and everything you currently fear is already factored in.. to an extent. Even higher yields are not bothering the market as much as some expected.

[bitchstewie]

FreeLitres said:

I'm a complete novice in this, but I've been studying the returns of EFTs such as the S&P 500 and with all the world troubles happening I have a feeling that the market will decline significantly in the next 6 months. I understand time in the market beats timing the market, but I just don't want to dump in a lump sum just as this peak looks like it is over. I'd prefer to drip feed in to try and catch more of the rise.

Bad move then?

A thought experiment.

Look at a long term graph of the S&P or a global tracker and pick a point when your "feeling" would have told you it will significantly decline in the next 6 months.

Now look where the graph is today.

Lump sum helps with psychology so I get that but I also think it's better to get your risk appetite right and invest accordingly than it is to think you can jump in and out of the market based on a feeling.

[C69]

FreeLitres said:

I'm a complete novice in this, but I've been studying the returns of EFTs such as the S&P 500 and with all the world troubles happening I have a feeling that the market will decline significantly in the next 6 months. I understand time in the market beats timing the market, but I just don't want to dump in a lump sum just as this peak looks like it is over. I'd prefer to drip feed in to try and catch more of the rise.

Bad move then?

I'd agree with the other responses to this.

A good way to manage market risk is to spread your holdings across various countries and asset classes i.e. don't put everything into an S&P 500 fund.

If you're using Vanguard, its LifeStrategy funds are a simple way to achieve this. Yes, they have their detractors (skewed UK exposure, fees maybe higher than they could be), but they generally work as a 'fire and forget' solution.

Another thing to bear in mind: if you're planning on holding on to your ISA for, say, at least the next five years, then you'll likely ride out any short-term declines. However, if you know that you're going to need to liquidate your ISA within the next year to spend the money on something else, then you should consider shifting out of equities into something less volatile.

[Phooey]

Regarding LifeStrategy - interesting to see Vanguard’s latest 10y VCMM forecast to favour the returns of UK equities

[Simpo Two]

FreeLitres said:

I'm a complete novice in this, but I've been studying the returns of EFTs such as the S&P 500 and with all the world troubles happening I have a feeling that the market will decline significantly in the next 6 months. I understand time in the market beats timing the market, but I just don't want to dump in a lump sum just as this peak looks like it is over. I'd prefer to drip feed in to try and catch more of the rise.

Bad move then?

Ideally you'd invest when markets are low but the mantra is 'you can't time the markets'. I'm not convinced. I'm keeping my 24/25 ISA allowance in 'cash' for now.

The S&P500 is an index; you can invest either in a fund or an ETF (not an EFT!). An ETF has the advantage that it attracts fees as a share not a fund so over a certain amount you pay lower platforms fees. However not everything is available as an ETF.

[FreeLitres]

Thanks all,

The Vanguard site kept hanging last night but I tried again this morning and the transfer request has gone through, so I'm waiting for the funds to arrive. It could take 30 days. It will arrive in cash and not allocated just yet.

I do want a low maintenance approach to this Vanguard account. (I have a smaller amount in my Trading 212 account to have a more hands on play around with individual shares, etc.

I have about 20 years before retirement. I'm transferring in about 25k now and I'm hoping to chunk in about £500 - £1000 a month.

Is it best to have a few different ETFs and split money between them? A Life strategy fund, a S&P 500, a whole world ETF?

Any suggestions as to which Vanguard funds would offer a reasonable return over 20 years with minimum faffing about?

[Simpo Two]

FreeLitres said:

Is it best to have a few different ETFs and split money between them? A Life strategy fund, a S&P 500, a whole world ETF?

It depends how much that £25K represents of your total investments. I wouldn't want all my stash invested in one thing, but what you invest in and what your attitude to risk is, is personal to you.

[Zj2002]

Simpo Two said:

FreeLitres said:

Is it best to have a few different ETFs and split money between them? A Life strategy fund, a S&P 500, a whole world ETF?

It depends how much that £25K represents of your total investments. I wouldn't want all my stash invested in one thing, but what you invest in and what your attitude to risk is, is personal to you.

I would argue that investing in a life strategy fund, S&P50 or a whole world ETF is what you do because you don’t want all your stash invested in one thing.

[bitchstewie]

FreeLitres said:

Any suggestions as to which Vanguard funds would offer a reasonable return over 20 years with minimum faffing about?

FTSE Global All Cap or if you don't want the volatility of 100% equities look at LifeStrategy at an appropriate mix of equities and bonds.