Vanguard LifeStrategy

[halo34]

Have to agree. Picked up Vanguard after seeing discussions on here.

Gradually kept trickling funds in from other places and had good returns across a number of different options.

Selling/buying is a little slow so I keep money with them I dont need in a hurry.

Selling on the Covid down and buying back in paid dividends for me...but it was pure luck. Growth otherwise is pretty decent.

[rdjohn]

forest172 said:

This was the thread that started me on my funds journey. Now got lots of money in these both with IM and Vanguard

ISAs, SIPP, GIAs and ltd company GIAs also as of yesterday junior ISA for my youngest

The gains since I started have been great and I held my nerve during covid.

Thank you pistonheads best move I’ve ever made and I’m still only 45 but wished I’d done more at 25

Agreed.

Smartest move I ever made. Having money in just one place makes investment and knowing exactly how much you have, so simple. As I still have too much in BS I was happy with Lifestrategy 80 and when you look at how diversified the funds are spread globally, you are only exposed to general sentiment. Their allocations of funds has moved far more than I expected it would, post Brexit, Trump, Covid, so it is still looking for best returns on a £sterling base.

I guess that fund managers rarely sell stocks and bank their gains, they sell one thing to buy something else, so this level of diversity is largely unaffected by day-to-day trading.

[anonymous-user]

For me getting a Vanguard account was the next logical step after realising that getting 0.5% from a Marcus account was a waste of time and I was actually losing money. I certainly don't have enough money to bother with an IFA and I know nothing about stocks and shares so don't want to buy random shares and hope for the best. Plus the Vanguard management fees are very reasonable and you can easily sell and withdraw the money in a few days.

I was originally thinking of just over paying my mortgage instead, but thought if the Life strategy investment returns more than 1.6% a year I am better off. I am hoping for a 7% average annual return on the Vanguard account and have worked out how much I need to save each month to end up with enough to pay off my mortgage in 7 years.

Sounds good in theory anyway, I have gone Lifestrategy 100, go big or go home............

[boyse7en]

I've had a Lifestrategy account for about 18 months and it seems to be doing well. Am i best putting a bit more into that (LS80 fund) or should i put it into a different fund - maybe an active fund?

[ATM]

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

[dingg]

ATM said:

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

People have been saying that for the past 10 years.


Currently there's nowhere else but equities/funds to make a worthwhile return until that changes best jump on board.

[anonymous-user]

dingg said:

People have been saying that for the past 10 years.

Currently there's nowhere else but equities/funds to make a worthwhile return until that changes best jump on board.

That is the same conclusion I have come to, and if Covid has proven anything it is the amount of money the government will print to stop this happening knows no limits.

This money then has to go somewhere, hence why equities/funds and assets such as cars and houses have gone up massively.

The government is always going to protect the rich, so you might as well invest in the same things they do.

Otherwise you might as well join the HousePriceCrash forum and get more and more angry that you used to have enough cash in your Marcus account to buy a house, and now you only have enough for the deposit.

[Sheepshanks]

dingg said:

ATM said:

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

People have been saying that for the past 10 years.

Yep, I've thought things (especially US) have looked bonkers for some years. I'm quite heavily biased to cash - that was quite a mistake.

Trouble is, I'm 64, still working, but I can't really afford to take a big hit now. I'm in an OK position, but it could have been a lot better..

Edited by Sheepshanks on Thursday 2nd September 14:22

[Zoon]

ATM said:

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

Even with a 30% correction I'd still be beating what it makes in the bank.

[MElliottUK]

Joey Deacon said:

For me getting a Vanguard account was the next logical step after realising that getting 0.5% from a Marcus account was a waste of time and I was actually losing money. I certainly don't have enough money to bother with an IFA and I know nothing about stocks and shares so don't want to buy random shares and hope for the best. Plus the Vanguard management fees are very reasonable and you can easily sell and withdraw the money in a few days.

I was originally thinking of just over paying my mortgage instead, but thought if the Life strategy investment returns more than 1.6% a year I am better off. I am hoping for a 7% average annual return on the Vanguard account and have worked out how much I need to save each month to end up with enough to pay off my mortgage in 7 years.

Sounds good in theory anyway, I have gone Lifestrategy 100, go big or go home............

Exactly the same situation and fund for me, I am about 5 years into putting my mortgage overpayment into Vanguard instead of the mortgage directly. In 2 years time I am on track to clear my remaining mortgage. In summary your strategy is working for me, good luck.

EDIT - The result of me monitoring fund performance, I believe it is best to not actually pay off the mortgage, just keep both mortgage and fund going indefinitely knowing that you have the ability to pay it off. If you pay it off too soon you are losing the compounding effect between the assumed fund return and mortgage rate which could be approx 5% per year, that over a 10 to 20 year period is a considerable sum of money.

Fund greater than or equal to remaining mortgage = mortgage free

Edited by MElliottUK on Thursday 2nd September 14:45

[funinhounslow]

dingg said:

ATM said:

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

People have been saying that for the past 10 years.


Currently there's nowhere else but equities/funds to make a worthwhile return until that changes best jump on board.

Did we not have a serious correction last year during lockdown?

Markets have recovered since then. If Brexit and COVID can't trigger a bear market I'm not sure what can to be honest...

[PeteinSQ]

ATM said:

I dont want to poo poo all this optimism. But we are in a unique situation right now where all assets are in a massive bubble. Once this bubble pops there will be a serious correction. So by all means go all in now but bear in mind the correction could be swift and savage.

I think you're probably correct but it's very difficult to time when that will happen and once it has happened the chances are things will slowly pick up again. If you're investing for the long term then investing in something like LS80 really is about the best you can do. Sure there could be a massive correction and your current funds could lose 50% of their value, but you're then hopefully still regularly investing at this now lower base and over the following 20 year horizon things will recover (and likely correct) again.

The alternative is sitting on it in cash or gold and neither of those are without risk.

I think you want a big enough cash savings pot that can cover several months of expenses and then put the rest somewhere that's more risky and will beat inflation most of the time, especially if it's invested for the long term.

[ATM]

funinhounslow said:

Did we not have a serious correction last year during lockdown?

The US is printing money like never before. I wont pretend to know the details but you can look them up. They started this in 2008 after the GFC and it has never stopped. They said it would be temporary. Inflation is now getting out of control. The only way to stop inflation is to raise interest rates. If you are going to raise rates you need to stop buying bonds with printed money first. The US is buying something like $120bn of Mortgage Backed Securities every month. Thats why their house prices are out of control. Any bank can write a mortgage and then sell the risk to the treasury. They banned landlords evicting tenants but that will stop soon and masses of people will become homeless. This is a unique situation which we have never had before. You can surely see this escalating and getting out of control. UK house prices rose something like 16% year on year last month. The only reason the SP500 has flown up since last year is because the US announced more and more printing at faster and larger rates. There is no other reason for the rise. So take the printing away and what do you have left? Everything will correct, houses, bitcoin/s, equities and other assets.

Obviously the interesting one for us here is cars. It doesn't take a genius to see that used car prices have risen at a ridiculous rate this last 12 months. Do we honestly believe this rise was normal and healthy and not just driven by all the bail outs from our government? The more they bail the more asset prices increase.

[dingg]

ATM said:

funinhounslow said:

Did we not have a serious correction last year during lockdown?

Obviously the interesting one for us here is cars. It doesn't take a genius to see that used car prices have risen at a ridiculous rate this last 12 months. Do we honestly believe this rise was normal and healthy and not just driven by all the bail outs from our government? The more they bail the more asset prices increase.

Pubs shut, restaurants shut, high street closed down, no holidays abroad allowed.

People have more disposable in the bank than they ever have had. Got to spend it somewhere so thats the jump in car and house prices, obviously also aided by the stamp duty holiday. Will they crash? Maybe a gentle deflation imo.

[funinhounslow]

Isn't the car price increase due to supply of new cars being throttled because of microchip shortages? And possibly people bring unwilling to use public transport...

I agree the massive bond buying programme has inflated assets like shares, housing and crypto. But I don't see how we can unwind from this without bursting these bubbles and triggering deflation.

Truly we are in uncharted territory.

[ATM]

funinhounslow said:

Isn't the car price increase due to supply of new cars being throttled because of microchip shortages? And possibly people bring unwilling to use public transport...

I agree the massive bond buying programme has inflated assets like shares, housing and crypto. But I don't see how we can unwind from this without bursting these bubbles and triggering deflation.

Truly we are in uncharted territory.

All cars are going up and it started last year after the government started handing out money to every Tom, Dick and Harry. Yes a shortage of supply of new vehicles may help fuel the fire but asset prices rise due to the availability of money to buy them. If the government had not handed out lots of money do you think people might have just kept their old car for a bit longer instead of 'needing' another? I am driving a lot less in this new normal as I dont commute now. So arguably I have less need for a car. There is also the mass exodus of people from London and into the burbs which could mean some of these people now need a car where as before they did not. So yes I dont think it is all down to government bail outs.

There is a little local pub near me. You know those businesses that are really struggling and cant make any money. Just before the lock downs said pub had a 635d parked outside. Lets say it was worth 10 grand. Towards the end of the lock down I noticed a massive modern Range Rover parked outside. Lets say it is worth 30 grand easily. An isolated incident and I have no idea of the real reasons behind it but I do know that anyone with a business was handed all sorts of bail outs for closing their doors. You can see where my 2 and 2 came from to make 4.

[Sheets Tabuer]

dingg said:

Will they crash?

Who knows but they always return to mean, that much is certain.

[springfan62]

I have invested in Vanguard Life strategy 100 for some time now but I have also put some funds into L&G International Index which is a similar passive investment fund.

The latter has outperformed Vanguard consistently so may be worth a look if you want to spread risk.

[BobToc]

Bubbles are booms that go bad, not all booms go bad.

[Nano2nd]

ATM said:

There is a little local pub near me. You know those businesses that are really struggling and cant make any money. Just before the lock downs said pub had a 635d parked outside. Lets say it was worth 10 grand. Towards the end of the lock down I noticed a massive modern Range Rover parked outside. Lets say it is worth 30 grand easily. An isolated incident and I have no idea of the real reasons behind it but I do know that anyone with a business was handed all sorts of bail outs for closing their doors. You can see where my 2 and 2 came from to make 4.

honestly I don't know where to start with this!