£800k to invest what would you do?
Discussion
Aiming to have funds of £800k from a business sale and current self funded pension later this year. Nov/Dec.
Plan to feed in over a 3-5 mth period.
Wife and I Aiming to stop working Dec 2022 and have 36 years until age 90.
We have some rental properties already providing an income so this fund will just go into Stocks/shares/equities etc.
No debts rental properties could be sold down in the future if required. worth about £700k.
We also have 3x years of cost of living as cash separate to the above to use if stocks fall/underperform.
State pension in 14yrs
What would you guys do with it to try and get the most return from the stock markets?
We plan to put into stocks via Intelligent money with a split of;
40% Index tracker weighted 80 eq/20 bonds IM
30% Global Growth IMGG
so about 70% general trackers then;
15% IM-T technology weighted
15% IM-E IM large cap of 10 firms.
Clearly bad sequencing issues may occur but hoping with the recent drop and by Xmas it may be towards the lower end or with another 6/12mths to go. Would wish to draw out 4% each year
We have been playing with various investment charts but the recent hits to the markets is spooking us ! we fully realise that we cant leave it as cash so do have to invest to generate an income we would wish for.
what would you gents do? What would you think £ wise we may hope for?
Ive resisted posting here as I dont want to appear crass but we are getting to a decision point and want to have some thoughts from others who have more experience in this then us and its daft not to without figures
Plan to feed in over a 3-5 mth period.
Wife and I Aiming to stop working Dec 2022 and have 36 years until age 90.
We have some rental properties already providing an income so this fund will just go into Stocks/shares/equities etc.
No debts rental properties could be sold down in the future if required. worth about £700k.
We also have 3x years of cost of living as cash separate to the above to use if stocks fall/underperform.
State pension in 14yrs
What would you guys do with it to try and get the most return from the stock markets?
We plan to put into stocks via Intelligent money with a split of;
40% Index tracker weighted 80 eq/20 bonds IM
30% Global Growth IMGG
so about 70% general trackers then;
15% IM-T technology weighted
15% IM-E IM large cap of 10 firms.
Clearly bad sequencing issues may occur but hoping with the recent drop and by Xmas it may be towards the lower end or with another 6/12mths to go. Would wish to draw out 4% each year
We have been playing with various investment charts but the recent hits to the markets is spooking us ! we fully realise that we cant leave it as cash so do have to invest to generate an income we would wish for.
what would you gents do? What would you think £ wise we may hope for?
Ive resisted posting here as I dont want to appear crass but we are getting to a decision point and want to have some thoughts from others who have more experience in this then us and its daft not to without figures
Edited by superlightr on Monday 9th May 10:22
Edited by superlightr on Monday 9th May 10:24
Edited by superlightr on Monday 9th May 10:25
I think your plan is sound enough. I think its a prudent plan to drip in over the next 6-12 months.
I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
gotoPzero said:
I think your plan is sound enough. I think its a prudent plan to drip in over the next 6-12 months.
I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
thank you - what are the MMM forums? on PH?I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
Personally with that amount of money I'd be looking at discretionary fund management instead, as an investment manager will be able to manage your CGT issue.
Also why drip feed this over 3-5 years? At my firm clients who invested a lump sum outperformed drip feeding client just under 75% of the time.
Also why drip feed this over 3-5 years? At my firm clients who invested a lump sum outperformed drip feeding client just under 75% of the time.
superlightr said:
gotoPzero said:
I think your plan is sound enough. I think its a prudent plan to drip in over the next 6-12 months.
I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
thank you - what are the MMM forums? on PH?I also think your plan of 4% is also reasonable.
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
So my only "advice" FWIW would be to consider spreading the risk ever so slightly.
Also check out the MMM forums if not already done so - some great advice on there.
Jackals said:
Also why drip feed this over 3-5 years? At my firm clients who invested a lump sum outperformed drip feeding client just under 75% of the time.
Months not years.... Personally I think its a gamble worth taking at the moment. I suspect the chances of the market going down are higher than it going up.
Just my 2ps worth though.
gotoPzero said:
Jackals said:
Also why drip feed this over 3-5 years? At my firm clients who invested a lump sum outperformed drip feeding client just under 75% of the time.
Months not years.... Personally I think its a gamble worth taking at the moment. I suspect the chances of the market going down are higher than it going up.
Just my 2ps worth though.
gotoPzero said:
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
whats the thinking behind this please? Personally I would want to have some spread over a couple of institutions at the least.
IM have low rates and have been with them for the last couple of years and I find it easy to access/adjust at present.
superlightr said:
gotoPzero said:
The only thing I would say is you are putting your entire 800 in with IM.
Personally I would want to have some spread over a couple of institutions at the least.
whats the thinking behind this please? Personally I would want to have some spread over a couple of institutions at the least.
IM have low rates and have been with them for the last couple of years and I find it easy to access/adjust at present.
Its your call, but I would not put 100% in the hands of one company. You have no redundancy.
superlightr said:
What would you guys do with it to try and get the most return from the stock markets?
Surely the objective has to be to get sufficient returns so you don't run out of money at the lowest risk possible rather than the outright best return?superlightr said:
Would wish to draw out 4% each year
It could be ambitious, especially given your ageDerek Chevalier said:
Jackals said:
Personally with that amount of money I'd be looking at discretionary fund management instead, as an investment manager will be able to manage your CGT issue.
I'm not sure why you'd need to pay a DFM to manage a CGT issue 
I should have probably just worded my original reply better
Given how volatile an unprediatble the world markets are at the moment I would be dripping into several (let's say 10 for simple maths) different trackers and funds over 24mths using Enhanced Dollar Cost Averaging.
In simple terms 800k/24/10 = £3,333 per fund/tracker per month. That's your base amount and it's only that amount in Month 1.
If the tracker/fund goes up on month 1 you put in less (let's say £3k) and if it goes down you put in more (say £3666). Theory is you buy the dip a little and avoid the peaks a little.
By a mix of funds trackers you go with say a US tracker, UK tracker, EU tracker. Worldwide Tracker, then maybe some sector ones like a Healthcare tracker, Tech tracker, ESG tracker, then managed funds you like the look of.
If there are any major market shocks (like the massive dip we saw in March 2020) then I would add some lump sums across the board too. But the dip needs to be visible when zoomed right out on a graph.
In simple terms 800k/24/10 = £3,333 per fund/tracker per month. That's your base amount and it's only that amount in Month 1.
If the tracker/fund goes up on month 1 you put in less (let's say £3k) and if it goes down you put in more (say £3666). Theory is you buy the dip a little and avoid the peaks a little.
By a mix of funds trackers you go with say a US tracker, UK tracker, EU tracker. Worldwide Tracker, then maybe some sector ones like a Healthcare tracker, Tech tracker, ESG tracker, then managed funds you like the look of.
If there are any major market shocks (like the massive dip we saw in March 2020) then I would add some lump sums across the board too. But the dip needs to be visible when zoomed right out on a graph.
I was in the same position and with a similar amount of money 12 months ago following a BTL sale, I decided to invest half of the amount initially with the other half to be added should the market drop.
I spread it around various funds that I already owned - Fundsmith, Baillie Gifford, IM, Vanguard, Blue Whale and Capital Gearing Trust along with topping up some shares that I already held, all of which had performed very well.
At the end of December I was 9% up and thought I was a genius, I've invested another £100k or so since January buying some of the above that have dropped substantially.
12 months on Capital Gearing Trust and Vanguard are the only funds that are up, Vanguard also has the the lowest fees of them all.
I don't need the money any time soon and whilst it's irritating it's not much of an issue as I'd invested on a 5-10yr basis. I would agree with the comments above that you really shouldn't be investing the whole amount with one fund manager.
At your age time is on your side and I'd be investing monthly over the next year or so bearing in mind that the market is unlikely to recover in the short term.
I spread it around various funds that I already owned - Fundsmith, Baillie Gifford, IM, Vanguard, Blue Whale and Capital Gearing Trust along with topping up some shares that I already held, all of which had performed very well.
At the end of December I was 9% up and thought I was a genius, I've invested another £100k or so since January buying some of the above that have dropped substantially.
12 months on Capital Gearing Trust and Vanguard are the only funds that are up, Vanguard also has the the lowest fees of them all.
I don't need the money any time soon and whilst it's irritating it's not much of an issue as I'd invested on a 5-10yr basis. I would agree with the comments above that you really shouldn't be investing the whole amount with one fund manager.
At your age time is on your side and I'd be investing monthly over the next year or so bearing in mind that the market is unlikely to recover in the short term.
Jackals said:
Derek Chevalier said:
Jackals said:
Personally with that amount of money I'd be looking at discretionary fund management instead, as an investment manager will be able to manage your CGT issue.
I'm not sure why you'd need to pay a DFM to manage a CGT issue I should have probably just worded my original reply better
Mr Overheads said:
Given how volatile an unprediatble the world markets are at the moment I would be dripping into several (let's say 10 for simple maths) different trackers and funds over 24mths using Enhanced Dollar Cost Averaging.
In simple terms 800k/24/10 = £3,333 per fund/tracker per month. That's your base amount and it's only that amount in Month 1.
If the tracker/fund goes up on month 1 you put in less (let's say £3k) and if it goes down you put in more (say £3666). Theory is you buy the dip a little and avoid the peaks a little.
By a mix of funds trackers you go with say a US tracker, UK tracker, EU tracker. Worldwide Tracker, then maybe some sector ones like a Healthcare tracker, Tech tracker, ESG tracker, then managed funds you like the look of.
If there are any major market shocks (like the massive dip we saw in March 2020) then I would add some lump sums across the board too. But the dip needs to be visible when zoomed right out on a graph.
I'm not entirely sure why you need a whole raft of trackers when global trackers are widely available.In simple terms 800k/24/10 = £3,333 per fund/tracker per month. That's your base amount and it's only that amount in Month 1.
If the tracker/fund goes up on month 1 you put in less (let's say £3k) and if it goes down you put in more (say £3666). Theory is you buy the dip a little and avoid the peaks a little.
By a mix of funds trackers you go with say a US tracker, UK tracker, EU tracker. Worldwide Tracker, then maybe some sector ones like a Healthcare tracker, Tech tracker, ESG tracker, then managed funds you like the look of.
If there are any major market shocks (like the massive dip we saw in March 2020) then I would add some lump sums across the board too. But the dip needs to be visible when zoomed right out on a graph.
I like threads like this so for fun I'll play (this is just my 2p)
The below is assuming you have enough cash for 3-5yrs living expenses and you are happy with this £800k being a 100% equity investment (to add to your other investments, BTL etc)
1/ I wouldn't bother with anything with bonds in it
2/ Cheap & low-cost. I actually invest with IM but only in Index100 - weighted world tracker based on MSCI passives. Yes there are slightly lower cost world funds but i like IM. I also have a Vanguard account - Global All-Cap and VWRL. But you only really need 1 world fund
3/ DEFINITELY average/drip in. My opinion is we are in a bear market (just not technically confirmed, yet). I also think a recession here and the US is almost unavoidable - the markets are pricing this in, but confirmation will drive the markets lower.
4/ Set a plan and stick to it
5/ Don't look at it's performance in the short-medium term - it'll likely make you doubt your plan
And fair play to you
The below is assuming you have enough cash for 3-5yrs living expenses and you are happy with this £800k being a 100% equity investment (to add to your other investments, BTL etc)
1/ I wouldn't bother with anything with bonds in it
2/ Cheap & low-cost. I actually invest with IM but only in Index100 - weighted world tracker based on MSCI passives. Yes there are slightly lower cost world funds but i like IM. I also have a Vanguard account - Global All-Cap and VWRL. But you only really need 1 world fund
3/ DEFINITELY average/drip in. My opinion is we are in a bear market (just not technically confirmed, yet). I also think a recession here and the US is almost unavoidable - the markets are pricing this in, but confirmation will drive the markets lower.
4/ Set a plan and stick to it
5/ Don't look at it's performance in the short-medium term - it'll likely make you doubt your plan
And fair play to you
Derek Chevalier said:
Fair point, I just struggle with the value aspect of most DFMs. Given on a pot of circa £800k you should be able to get all in advice for around 0.8% (platform 0.1%, funds 0.3% and advice 0.4%), to add the typical ~0.4% for a typical DFM is adding 50% to the total fees. A decent adviser should plan withdrawals and manage overall taxation as part of their ongoing fee.
Completely understand that, think it really depends on the client. If the client needs something bespoke where they don't want to invest in certain industries due to ethical reasons or depending who they work for e.g. Deloitte, that's probably where the value is. If it's your box standard client, then something like what you've suggested is much better them. Derek Chevalier said:
superlightr said:
What would you guys do with it to try and get the most return from the stock markets?
Surely the objective has to be to get sufficient returns so you don't run out of money at the lowest risk possible rather than the outright best return?
One thing that stands out on your plan is the 70% investment into some global tracker fund. There are a number of decent cheaper global trackers in the market which can do the same job. More importantly, for your passive pot of £560k (70% of £800k), you can make significant fee saving using a fixed fee platform. Just quickly knocked up your £560k pot comparing fees between IM80 against the forum favourite VLS80
invested through ii and direct with Vanguard itself. 
|https://thumbsnap.com/36YUuj35[/url]As you can see, using a fixed fee platform can save you a significant amount of £££ over the years (even more savings if you 1) use iWeb which is a basic but functional platform, or/and pick an even cheaper global trackers!!)
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