Pension fund performance - do you monitor yours, how is it doing, do you actively change it?
- Thread starter danlightbulb
- Start date
Isn't the idea of a properly weighted global tracker that the market will function as it is meant to, therefore the market cap by country will adjust naturally. UK dropping down in market cap % is one example of this mechanism as more companies list in the USA.
By having a heavy weight on one market over another outside of the actual market cap proportion, you're basically saying that you're cleverer than everyone else and think you will beat the market.
I am guilty of this by ever so slightly increasing my US allocation but it's with extra funds outside my regular contributions. I was balls-out USA for a while to try to recover from some poor performance in a previous managed fund. Possibly stupid idea in reality but it paid off and I've now re-balanced - I won't be testing my luck by being so cocky again.
I did see a video with backtesting between Global Index vs USA which was interesting to watch.
EDIT: This one - https://www.youtube.com/watch?v=eIUgjib_fm4
By having a heavy weight on one market over another outside of the actual market cap proportion, you're basically saying that you're cleverer than everyone else and think you will beat the market.
I am guilty of this by ever so slightly increasing my US allocation but it's with extra funds outside my regular contributions. I was balls-out USA for a while to try to recover from some poor performance in a previous managed fund. Possibly stupid idea in reality but it paid off and I've now re-balanced - I won't be testing my luck by being so cocky again.
I did see a video with backtesting between Global Index vs USA which was interesting to watch.
EDIT: This one - https://www.youtube.com/watch?v=eIUgjib_fm4
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This is partly I went with VHVG giving me:
I was going to add VUAG but this % is more than enough. Pumping in monthly or yearly lum and average returns is more than enough long-term rather than all out risk in my SIPP.
My partner is more hesitant so VWRP / Global All Cap would suit better at 60%
| United States of America | North America | 68.4% |
I was going to add VUAG but this % is more than enough. Pumping in monthly or yearly lum and average returns is more than enough long-term rather than all out risk in my SIPP.
My partner is more hesitant so VWRP / Global All Cap would suit better at 60%
Soldato
those percentages on fact sheets are only correct at the time of writting and how oftern they decide to update their paper work and rebalance the tracker.
Some pension providers will use platforms like ishare or vanguard for their trackers but won't update their paper work that often but gives you a rought idea on the weighting.
mutual funds are only updated at the close of each trading day and while ETFs are traded like any other stock... anything +/- 5% is just trading noise..
The "United States of America' may include the Russell 1000 and Russell 2000 index funds along with the S&P 500, and those can be weighted differently depending on the tracker/platform.
Some pension providers will use platforms like ishare or vanguard for their trackers but won't update their paper work that often but gives you a rought idea on the weighting.
mutual funds are only updated at the close of each trading day and while ETFs are traded like any other stock... anything +/- 5% is just trading noise..
The "United States of America' may include the Russell 1000 and Russell 2000 index funds along with the S&P 500, and those can be weighted differently depending on the tracker/platform.
I am definitely keen on having exposure to mid and small cap in the US (hence all cap index for me). Really hoping the market explodes once interest rates start coming down rather than it being a handful of companies doing the heavy lifting.
Definitely breaking the "don't look at it" rule with this kind of thinking. Although I think it's a stupid rule and it should be, "periodically check against benchmarks".
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Soldato
I would be lovely if I guessed correctly a company in the russell 2000 that would get prompted to the S&P 500... the shares for that company would just rocket up with all the trackers, matual funds and bots paying into it... lol
Associate
fair point - I've been meaning to change it over!
Soldato
- Joined
- 23 May 2006
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I have a final salary pension with 19.5 years in it. on one hand it is doing ok in so far as it hasn't collapsed. OTOH it's operating with a significant short fall and that is with hardly anyone claiming on it. in time it is going to get a lot more pressure (it's closed off now and everyone is off it).
for now the parent company has been paying the short fall to keep it going. how long that lasts tho.......
for now the parent company has been paying the short fall to keep it going. how long that lasts tho.......
I have an investment account that is taxable that I will transfer 20k to an ISA each year, in the taxable account I have MSTR. Its been a wild ride since 2021. With BTC and my stocks in 2021 I had close to 1.1 million USD, in 22/23 that went down to about 200K USD (while I was unemployed for close 2 years!) and now I’m back close to 1.1 again.
Soldato
In theory, your DB scheme should be covered by the government Payment Protection Scheme. This is 90% of what you should have received.
Lots of DB schemes have been in deficit for years because of the way they are valued. Using actuarial calculations including interest rates. Now rates are higher and the schemes own investments are likely doing better, that deficit should be lower.
If there's a deficit, the scheme trustees should have released some kind of statement (I forget what it's called) advising the board how they intend to recover the shortfall.
Soldato
Don’t forget to check you NI records to see if you are forecast to get a full state pension.
www.gov.uk
A missing year could cost you £800 pounds to buy back, and it will give you an extra £300 pounds a year in retirement.
This year is the last year where you can buy back from a much earlier date, after this tax year you can only by back from the last 6 years.
Check your National Insurance record
Find out if you've paid enough National Insurance to qualify for the full State Pension - check gaps, contributions and credits, get a National Insurance statement, call the helpline.
A missing year could cost you £800 pounds to buy back, and it will give you an extra £300 pounds a year in retirement.
This year is the last year where you can buy back from a much earlier date, after this tax year you can only by back from the last 6 years.
Soldato
- Joined
- 23 May 2006
- Posts
- 7,697
I thought you could.only ever back track 6 years?
Don’t forget to check you NI records to see if you are forecast to get a full state pension.
Check your National Insurance record
Find out if you've paid enough National Insurance to qualify for the full State Pension - check gaps, contributions and credits, get a National Insurance statement, call the helpline.
A missing year could cost you £800 pounds to buy back, and it will give you an extra £300 pounds a year in retirement.
This year is the last year where you can buy back from a much earlier date, after this tax year you can only by back from the last 6 years.
Any idea what you can do if there is a mistake in your record?
Mine says I only have a partial year in 1998/1999. That was the year I left sixth form (summer 1998) and went to university (sept 1998) but then left after the first year (so summer 1999 I left) but I had a part time (min 16 hrs) job as well at the time. So I should have a full year I think.
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Soldato
I bought an NI year last week as it happens. Made the payment through a weird process that seemed like a scam but wasn't. Then nothing changed in my NI record yet, seems like it can take 8 weeks, but I don't understand why it can't be instant. Very janky, hope it actually works properly.
Soldato
you may be right... I checked when scheme changed over and knew that there wasn't any years that I could buy back.. I caught something yesterday reminding people that the period that you can buy back was going to be shorten to the intended length as we still in a cross over period at the moment.
What ever the period is, it's worth people just checking.
Soldato
I'm not sure, before this scheme came out there was another one.
I had a letter though the post saying that I could buy back 4 years (that I was in uni?? and worked part time a bit so it was just messy) when I started working. At the time I really couldn't afford it so I didn't look into it.
I think if you leave education before the course you originally sign up for finishes, the government removes NI contributions supplements for that period of time, kinda a double edge sword. In my case I left before the orginal course finished and took a lesser degree.
IMHO it you plan be in employement for 35 years or more, it's not worth the buy back or hassle in looking into mistakes, thou the scheme can change again but at the moment if you been working for 30 years or more you will be entitled to a full state pension. I've more than made up for it now and only have only a few more years left before I get a full state pension no matter what happens.
and I think this will be the case for most people, as the gov changed it to make it more fair.This more for self employed, people who work aboard and people who have taken long period of working.
EDIT: just rechecked mine and the sad thing is that only I'm half way through my "expected" working life... the good news is that I still have half my "expected" working life to boost my pension.
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Unless your close to retirement - don't worry about it. Assuming your in fulltime employment etc- you'll most likely still end up with a full state pension.
Check it again when your 10 years from state pension age and see. Otherwise forget about it just now.
Maybe that year you didn't pay the full amount so only got credited with half a year etc. But like I say - don't worry about it. It's likely to be a non event anyway.
Oh that could explain it then.
I have only two years left until full state pension according to the checker, 20 years+ still to work. So its no problem, but would have been nice for it to say full for every year as the 98/99 year is a blemish currently.
Caporegime
Its alright, by the time I get anywhere near pension age it will probably have collapsed and we will be living in a mad max esque wasteland, just a little wetter as its the UK. Water world I guess.
Soldato
Yeah as said don't worry about it then, it'll catch up soon enough.