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31 Mar 20, 07:39 PM |
#11
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Thread Starter
Imagineer
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31 Mar 20, 07:41 PM |
#12
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Imagineer
Join Date: Jan 13
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What was date of the valuation you received? A quick look at a graph of the Reassure Stakeholder Balanced fund shows significant growth over 2019. Even if it's not exactly the same fund I would have expected your husbands plan to do something similar. The factsheet posted previously suggests the same. It's only when you get into March this year that you see a big drop.
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31 Mar 20, 08:47 PM |
#13
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Thread Starter
Imagineer
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31 Mar 20, 09:22 PM |
#14
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Imagineer
Join Date: Feb 13
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31 Mar 20, 09:36 PM |
#15
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Thread Starter
Imagineer
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1 Apr 20, 11:49 AM |
#16
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Imagineer
Join Date: Feb 13
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So I have taken a quick look (and I am no expert in this fund so just my ramblings).
Assuming it is this trustnet/factsheets/...er-balanced-pn It did seem to do well in 2019. So that is as expected. And the big drop was in the past months so is almost certainly down to CV - again as expected. A couple of things to consider (if it were me). It seems to be an old fund with little information. It also seems quite high risk for someone of 54 (75% equities?). Though this depends on when you need to start drawing on this and how dependent you are on it (e.g. is it his only pension, or id just to provide a top up for some other pensions and income). If it were me, I would be looking to move it to a lower risk investment. Though whether now is a good time to do this is anyones guess. With the market volatility, between the times of selling and buying the markets could move significantly in either direction). You should pull a plan together - based on when you need to have this in cash to spend (retirement? age?). That plan should include transferring some to cash (to spend) - well in advance. You want to be able to control the selling price - you dont want to be forced to selling just before he retired in case the prices are really low. I use 5 years. Also, you say fees are 1% - is this the advisor fee? There will also be platform and fund fees. 1% is quite high at the minute. You may also find the fund and platform fees are also high by today's standard. This continually erodes your gains. It would worry me (personal thing) that this seems an old investment with little information (as far as I can see). How is this being managed - through an advisor? Was the review with this advisor? Is he an IFA (the I (Independent) is the critical word here) - and not just an FA. Edited at 11:50 AM. |
1 Apr 20, 09:24 PM |
#17
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Thread Starter
Imagineer
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2 Apr 20, 09:25 AM |
#18
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Imagineer
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Nowadays you do not need to ditch your high risk/ high return investments as you can keep your fund as a drawdown.
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2 Apr 20, 09:47 AM |
#19
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Imagineer
Join Date: Feb 13
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This isnt relevant. The the issue isnt the type of pension vehicle, it is the investment risk being carried within that, and trying to avoid the risk go being forced to sell when you need the money after a bad time (like we are seeing right now).
This is happening across the globe right now - people retiring this month and starting to draw on defined contributions pensions (pension pot). Their salary has stopped and they are being forced to sell right now and in the coming months (crystallising massive losses) to get cash to live on. They had no plan and hadn't been derisking their holdings (to say cash on deposit). This has been one of the huge issues with pensions in recent years - many people are have become huge investors without their knowledge. Those that know this, dont understand it and refuse (or dont know) to get professional help from a good IFA who would work through all this with them. The derisking of holdings relates to the actual underlying investments and is nothing to do with the mechanism of with drawing (e.g. drawdown). It is a standard and well documented pattern for anyone coming towards retirement (pithing 7-10 years). All drawdown is is one way of actually extracting money (in whatever holdings) from a pension. You cant just take it out like you can from a bank account. For example, an alternative would be to transfer to an annuity where you take all your money out none go and buy a monthly amount. Edited at 09:56 AM. |
2 Apr 20, 10:13 AM |
#20
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Imagineer
Join Date: Feb 13
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The reason I thought it might be an older pension was that I couldn't find a lot of information on it. Pensions are a big thing at the minute - especially since the pension freedoms introduced a few years ago and there is normally loads of information on pension products.
Unfortunately I know nothing about Reassure. Looking again at the graph - if you ignore the recent month - it has increased 15% in the last five years (including this "crash"). That is still doing OK and is at least keeping up with inflation. You should never focus on a one year comparison - investments (especially equities) are long term investments - compare over 5 or 10 years. There are now pensions that manage the reducing risk for you as you approach pension age. I cant remember the name - maybe Lifestyling pensions. These pensions basically change your holdings (moving from equities to bonds/cash over time). My company used Standard Life products for the - standardlife/c1/lifestyling.page or reassure/uploads/L..._factsheet.pdf These are in effect a fire and forget type pension product. Reassure seem to have similar products. They manage this risk reduction phase for you. If you dont fully understand pensions, and dont want to learn about them, then I STRONGLY suggest you seek professional advice. This is not cheap (but may be extremely good value), but the stakes here are ENORMOUS if this is his only/main pension. Imagine you had to rewire your house - would you have a go yourself knowing nothing about electrics? Probably not - you would get an electrician in. Same with personal finance. It isnt as obvious, but the right financial strategy vs the wrong strategy could cosy you an absolute fortune (and many are finding out right now). The cost if using an IFA could could cost in ten times over in the long run. And potentially save you from a ruinous retirement (again as many are finding out right now). Edited at 10:21 AM. |
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