Any tips for a Vanguard newbie?
Discussion
I've got about £20k available which is sat earning no interest in my current account. The savings rates still seem really low so I'm thinking about investing.
I previously read on here that Vanguard is one of the better and lower cost platforms for doing this. Is this still correct?
Which is the real Vanguard URL to get set up?
www.vanguardinvestor.co.uk seems to be the top hit on Google.
www.vanguard.co.uk is the 2nd hit seems like it should be the right URL
Any tips on what fund type might offer me relatively steady growth with relatively low risk? (I know investments can go up and down) Is there a standard "go to" fund for newbies?
I previously read on here that Vanguard is one of the better and lower cost platforms for doing this. Is this still correct?
Which is the real Vanguard URL to get set up?
www.vanguardinvestor.co.uk seems to be the top hit on Google.
www.vanguard.co.uk is the 2nd hit seems like it should be the right URL
Any tips on what fund type might offer me relatively steady growth with relatively low risk? (I know investments can go up and down) Is there a standard "go to" fund for newbies?
FreeLitres said:
I've got about £20k available which is sat earning no interest in my current account. The savings rates still seem really low so I'm thinking about investing.
I previously read on here that Vanguard is one of the better and lower cost platforms for doing this. Is this still correct?
Which is the real Vanguard URL to get set up?
www.vanguardinvestor.co.uk seems to be the top hit on Google.
www.vanguard.co.uk is the 2nd hit seems like it should be the right URL
Any tips on what fund type might offer me relatively steady growth with relatively low risk? (I know investments can go up and down) Is there a standard "go to" fund for newbies?
How do you define low risk? Risk can mean many things in investing….I previously read on here that Vanguard is one of the better and lower cost platforms for doing this. Is this still correct?
Which is the real Vanguard URL to get set up?
www.vanguardinvestor.co.uk seems to be the top hit on Google.
www.vanguard.co.uk is the 2nd hit seems like it should be the right URL
Any tips on what fund type might offer me relatively steady growth with relatively low risk? (I know investments can go up and down) Is there a standard "go to" fund for newbies?
When may you need the money?
Depending on answers to above Vanguard might not be the platform for you as they only offer their own investments.
Imagine you invest your £20K and in a month or six months or whenever you come to look it's worth less than the £20K you started off with
Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
Also remember you don't have to immediately invest the £20K you could open an account and put the money in it to get is in the ISA wrapper and then take your time deciding what to invest in or whether to invest it in one go or bit by bit.
In the meantime Vanguard will pay you around 3% interest on that cash.
As above Vanguard can be a bit limiting as they only offer Vanguard investments but there's also a school of thought that by doing this they save you from yourself as you won't go mad on HL and invest in all last years winners like a lot of new investors do.
Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
Also remember you don't have to immediately invest the £20K you could open an account and put the money in it to get is in the ISA wrapper and then take your time deciding what to invest in or whether to invest it in one go or bit by bit.
In the meantime Vanguard will pay you around 3% interest on that cash.
As above Vanguard can be a bit limiting as they only offer Vanguard investments but there's also a school of thought that by doing this they save you from yourself as you won't go mad on HL and invest in all last years winners like a lot of new investors do.
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hstewie said:
hstewie said: Imagine you invest your £20K and in a month or six months or whenever you come to look it's worth less than the £20K you started off with
Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
Also remember you don't have to immediately invest the £20K you could open an account and put the money in it to get is in the ISA wrapper and then take your time deciding what to invest in or whether to invest it in one go or bit by bit.
In the meantime Vanguard will pay you around 3% interest on that cash.
As above Vanguard can be a bit limiting as they only offer Vanguard investments but there's also a school of thought that by doing this they save you from yourself as you won't go mad on HL and invest in all last years winners like a lot of new investors do.
Good advise.Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
Also remember you don't have to immediately invest the £20K you could open an account and put the money in it to get is in the ISA wrapper and then take your time deciding what to invest in or whether to invest it in one go or bit by bit.
In the meantime Vanguard will pay you around 3% interest on that cash.
As above Vanguard can be a bit limiting as they only offer Vanguard investments but there's also a school of thought that by doing this they save you from yourself as you won't go mad on HL and invest in all last years winners like a lot of new investors do.
I put 20k into my ISA last April. It dropped about 20k over the next month or so. Mentally I knew that 20k loss was a percentage of the total but it didn’t feel like it. Investments can go down as well as up.
cheesejunkie said:
Good advise.
I put 20k into my ISA last April. It dropped about 20k over the next month or so. Mentally I knew that 20k loss was a percentage of the total but it didn’t feel like it. Investments can go down as well as up.
That's quite a drop!!! I put 20k into my ISA last April. It dropped about 20k over the next month or so. Mentally I knew that 20k loss was a percentage of the total but it didn’t feel like it. Investments can go down as well as up.
OP, www.monevator.com has a good guide for investing, risk, and of various brokers.
ILikeCake said:
That's quite a drop!!!
OP, www.monevator.com has a good guide for investing, risk, and of various brokers.
Thanks all.OP, www.monevator.com has a good guide for investing, risk, and of various brokers.
Those monevator beginner guides are particularly good at helping me to get the foundations right regarding buying power, risk, etc.
ILikeCake said:
cheesejunkie said:
Good advise.
I put 20k into my ISA last April. It dropped about 20k over the next month or so. Mentally I knew that 20k loss was a percentage of the total but it didn’t feel like it. Investments can go down as well as up.
That's quite a drop!!! I put 20k into my ISA last April. It dropped about 20k over the next month or so. Mentally I knew that 20k loss was a percentage of the total but it didn’t feel like it. Investments can go down as well as up.
OP, www.monevator.com has a good guide for investing, risk, and of various brokers.
. There's a reason I won't give investment advice, the reason being you're better off listening to someone else. I've money in bitcoin too lol, but thankfully not much.Monevator is a good site.
Not a concern for the OP yet but from memory Vanguard charge a percentage, at some point it'll be worth looking at platforms that charge a flat fee instead once your pot is above a certain amount.
bhstewie said:
hstewie said: Imagine you invest your £20K and in a month or six months or whenever you come to look it's worth less than the £20K you started off with
Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
This 100%. A year ago my mother had £20k to invest so I suggested half in a life strategy 100 and half in the s&p 500. A couple of months later it was £2k down and I felt terrible.Is there a percentage/amount of loss that would make you feel really bad and uncomfortable and might make you consider selling and if so what sort of figure is it?
Everyone says they know investments can go down but trust me when you see real losses that are your own money for the first time it tends to focus the mind on what you can really stomach even if you think you're prepared for it so I'd give this a fair bit of thought
It then recovered to being worth £80 less than the £20k so she cashed out and put the money into her Marcus account.
She is much happier getting a guaranteed 2.5% each month from Marcus than the risk of the fund going down thousands over a few weeks.
Joey Deacon said:
This 100%. A year ago my mother had £20k to invest so I suggested half in a life strategy 100 and half in the s&p 500. A couple of months later it was £2k down and I felt terrible.
It then recovered to being worth £80 less than the £20k so she cashed out and put the money into her Marcus account.
She is much happier getting a guaranteed 2.5% each month from Marcus than the risk of the fund going down thousands over a few weeks.
I can understand that bad feeling. My wife has a lot of money sitting in savings accounts rather than invested. The rate of return is pretty bad but I’d feel really bad if I advised her to stick it into a tracker fund and it fell. Her attitude to risk is not the same as mine. It might not be optimal but being content with your decision counts for a lot too and it’s not always about always trying to maximise.It then recovered to being worth £80 less than the £20k so she cashed out and put the money into her Marcus account.
She is much happier getting a guaranteed 2.5% each month from Marcus than the risk of the fund going down thousands over a few weeks.
Not to be too pessimistic I’m very glad I did put money into my S&S ISAs. Taking the long view I’m well up from where I’d have been having the money in savings accounts. But when a small percentage swing can be thousands it takes a bit of getting used to.
A lot of people seem to forget there's plenty of middle ground between cash in the bank and a global tracker.
Likewise when you're new to this there's plenty of middle ground between doing something with the entire £20K v opening an account with £1000 (for example) and seeing how you react if you see yourself £100 down.
I invest cautiously but it's pretty scary how quickly you get used to seeing a months living expenses appear/disappear on a daily swing.
Likewise when you're new to this there's plenty of middle ground between doing something with the entire £20K v opening an account with £1000 (for example) and seeing how you react if you see yourself £100 down.
I invest cautiously but it's pretty scary how quickly you get used to seeing a months living expenses appear/disappear on a daily swing.
For me it’s being honest with yourself about timescales and the ability to switch off from it as it fluctuates.
I only really started about 3 years ago after having spent most of my savings on a house - currently £1500 up on a few years joint ISA allowances from being £10k up on about £40k early doors! So bear that in mind, 3 years is a long time, I’d have made loads more sticking it in savings products even after being smashed on tax. However, I have a long term view and I actually don’t seem to care if it goes down. If everything goes south and stays there we all have huge issues. Buying when things are down makes me happy for the future. But of course I’ve also bought at highs too with monthly contributions.
That all said, I wouldn’t feel the same if I didn’t have 12 months living in a cash account alongside the above, so I suppose it depends what other money you have currently and coming in that you can save etc.
I only really started about 3 years ago after having spent most of my savings on a house - currently £1500 up on a few years joint ISA allowances from being £10k up on about £40k early doors! So bear that in mind, 3 years is a long time, I’d have made loads more sticking it in savings products even after being smashed on tax. However, I have a long term view and I actually don’t seem to care if it goes down. If everything goes south and stays there we all have huge issues. Buying when things are down makes me happy for the future. But of course I’ve also bought at highs too with monthly contributions.
That all said, I wouldn’t feel the same if I didn’t have 12 months living in a cash account alongside the above, so I suppose it depends what other money you have currently and coming in that you can save etc.
okgo said:
That all said, I wouldn’t feel the same if I didn’t have 12 months living in a cash account alongside the above, so I suppose it depends what other money you have currently and coming in that you can save etc.
^^ that is a very important point.Make sure you have a suitable emergency fund as "cash" that is easily accessible before considering investing.
bhstewie said:
hstewie said: ^^ that is a very important point.
Make sure you have a suitable emergency fund as "cash" that is easily accessible before considering investing.
Marcus etc is perfect for that. Keep an eye on your tax free allowance though.Make sure you have a suitable emergency fund as "cash" that is easily accessible before considering investing.
With interest rates rising it’s not hard to accrue more than the allowance if you’re a higher rate tax payer. NS&I doesn’t give guaranteed returns but I’m averaging ok’ish and no tax worries. I do feel I’ve a bit too much in cash vs invested but I’ve spending plans for some of it. Emergency fund is something I thankfully haven’t had to raid but I do keep one.
bmwmike said:
The second redirects to the first for me anyway.
Wack in the 20k before end of tax year and leave as cash for now, it's 3% via vanguard at mo.
Good advice. They keep 0.2% for fees but still better than most.Wack in the 20k before end of tax year and leave as cash for now, it's 3% via vanguard at mo.
Edited by bmwmike on Saturday 28th January 09:33
For the OP we're heavily invested in VLS60...also have some in VLS80 but as above recently just been chucking it in as cash in a SIPP.
Regular contributions on an easy to handle platform with excellent phone advice if required and low fees. Contribute on a regular basis and forget for at least a decade.
DT1975 said:
Good advice. They keep 0.2% for fees but still better than most.
For the OP we're heavily invested in VLS60...also have some in VLS80 but as above recently just been chucking it in as cash in a SIPP.
Regular contributions on an easy to handle platform with excellent phone advice if required and low fees. Contribute on a regular basis and forget for at least a decade.
Good advice too. If only the forget for at least a decade part was easy For the OP we're heavily invested in VLS60...also have some in VLS80 but as above recently just been chucking it in as cash in a SIPP.
Regular contributions on an easy to handle platform with excellent phone advice if required and low fees. Contribute on a regular basis and forget for at least a decade.
.Grin and bear it might be more appropriate sometimes. But having a general confidence that the world is not going to pot helps.
To okgo’s comment I was penniless the day I bought my first house. Literally bank account had about two quid in it after solicitors fees etc. Eating that month required borrowing off friends. Sticking what I could in S&S ISAs since then is not a decision I regret and would recommend doing it but would never recommend specific investment choices.
Agree around investment choices but I also think that if someone is totally new to investing and nervous about DIY I'd be much more comfortable that if they stuck with Vanguard and either trackers or LifeStrategy that so long as they get their appetite for risk right they'll be there or there about.
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