Pension fund performance - do you monitor yours, how is it doing, do you actively change it?

slinxy said:
Without throw out extact numbers and your situation, we are only taking theory.. and yes if your affairs are complex or you're in doubt... go see a IFA.

The amount you pay into a salary sacrifice pension schemes are not considered as taxable income... as the money is taken from your pay before tax and ni.
Normal pension schemes are tax and NI before the money is taken out and your pension company should be claiming the tax amount back (but not your NI) for you like in a SIPP.

basically by using captial gains instead of taxable income, it gives you an extra £3,000 towards your "tax free allowance"...
what you need to consider is that by using salary sac to pay into your pension, your missing the 10% NI tax as well.. something a SIPP won't give you :)

I too have a load of shares in a GIA via work, and I tend to cash out on them as soon as they are income tax free, taking out the amount that is capital gains tax free.
but I reinvest it in a ISA stocks and shares, as they should have already been taxed the once, hell if I'm sticking into a SIPP and running the risk of it getting taxed on the way out again. if possible, start to withdraw the capital gains tax free allowance from the pot.. it may take a few years and you may get hit by mulitple transaction fees but it's tax free.

if you start throwing another person's tax allowance in to the mix, there's plenty of stuff you can do... like put all your higher taxed salary into a pension and not pay into theirs at all... as you would be getting better tax relief.
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Although its "relief at source" and you still need to reclaim the other 20% if your a higher rate payer, oh and probably only save 2% NI.
 
I can't access a sal sacrifice scheme, my employer puts in my contribution and their contribution and then Nest claim the 20%. I do direct payments into my Vanguard SIPP and they claim the 20%. So a reduction of NI contributions is not available to me.

Anyhow, it appears from general discussions and what i've read, that pension contributions do increase the 10% ceiling for paying CGT on share profits, so I'll need to look further to see if this and the 20% uplift into the pension, is favourable to my situation.
 
so back to the thread title...I'm new to Vanguard, I note that the valuation of my developed world ex uk fund changes on vanguard first thing in the morning.

Does that valuation take into account the prior day's index, i.e. does the valuation I see just now fully have yesterdays US sell off in it, or is there a delay before the valuation updates ?
 
Just worked out my rate of return for my pension since I've started it in September 2021, so 34 months..
7% which is average, it's mainly propped up by the mutral fund that it's invested in.. I didn't switch and add to market trackers until March 2024 (4ish months).

My personal investment returns for the same period is 5%, make's me think if it's all worth it.

My work based shares via SIP and SAYE should start to double up next year and maturaling but it's only a small percentage of my assets. Once it matures or becomes tax free, it's getting cashed out and moved into my personal investments.
 
slinxy said:
Just worked out my rate of return for my pension since I've started it in September 2021, so 34 months..
7% which is average, it's mainly propped up by the mutral fund that it's invested in.. I didn't switch and add to market trackers until March 2024 (4ish months).

My personal investment returns for the same period is 5%, make's me think if it's all worth it.

My work based shares via SIP and SAYE should start to double up next year and maturaling but it's only a small percentage of my assets. Once it matures or becomes tax free, it's getting cashed out and moved into my personal investments.
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Work back what that would have looked like if you had been fully invested in a global tracker instead. Also why would a personal investment be any different than a retirement investment? It wouldn't unless you choose to invest it differently.
 
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slinxy said:
My personal investment returns for the same period is 5%, make's me think if it's all worth it.
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Very hard to outperform a tracker something like 95% of all active managers fail so its not surprising, i'm pretty much all in to world trackers (I keep a small % for fun) and they're up about 35% in that same time you mentioned.
 
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Agreed, stick it in a world tracker or S&P 500 type fund until you get close to retirement. I'm 30% up since 2019, but I only switched my funds in 2021. If I'd have stuck in the default fund I'd probably be in single figure growth.
 
EvilRob said:
Work back what that would have looked like if you had been fully invested in a global tracker instead. Also why would a personal investment be any different than a retirement investment? It wouldn't unless you choose to invest it differently.
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That's a bad idea...
For one would take far too much maths, as nearly everyone dollar cost average into their pension be it monthly, yearly or randomly rather than lump sum it. If a tracker has gone up over a period then your consistently paying it at a higher price lowering your returns.

Also it incites using past performance to chase future gains, if only I had my pension into this rather than this... and once you cashed out or move funds, that's when profit or lost is crystallised.

Yes my pension pot may or may not have done better than a global tracker, mainly down to the loopy liz moment, but it does mean that I was buying shares into it at a lower cost for a fair few months while it recovered, if I move funds now; it would mean that I will never give it the chance to recover.

Personal investment should be different from a pension investment, else why bother having one and you might as well used the funds plus the amount you didn't pay in taxes to invest in your pension. Personally I plan on using my personal investments to retire early while leaving my pension pot untounched till the state pension age. Personal investment accounts allow you to invest in certain funds and markets that some pension companies deem as too risky or complexed so they just don't offer you the choice.

200sols said:
Very hard to outperform a tracker something like 95% of all active managers fail so its not surprising, i'm pretty much all in to world trackers (I keep a small % for fun) and they're up about 35% in that same time you mentioned.
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I'm 50% (of 90% is in a Dev'd world, 10% in em markets) in a world tracker, it's the dev'd world that seems to be dragging my pension retuns down at the moment.
 
I worked for a company with a DB scheme for 2 years before leaving to work elsewhere where it's all DC now. I've been getting annual blah blah blah from them about the state of their fund (went from being terribly underfunded to pretty good now due to additional injections of cash from the company) but never had a valuation of what it's worth so I emailed them to ask them how much it's worth annually and how much it's worth as a transfer value.

Apparently when I left the preserved pension was £1k a year in 2001, the revised total is now £2k a year. The transfer value is £25k.

I'll just keep it there I think, 2k less a year I need to worry about in my DC pensions.
 
OldKitMan said:
I worked for a company with a DB scheme for 2 years before leaving to work elsewhere where it's all DC now. I've been getting annual blah blah blah from them about the state of their fund (went from being terribly underfunded to pretty good now due to additional injections of cash from the company) but never had a valuation of what it's worth so I emailed them to ask them how much it's worth annually and how much it's worth as a transfer value.

Apparently when I left the preserved pension was £1k a year in 2001, the revised total is now £2k a year. The transfer value is £25k.

I'll just keep it there I think, 2k less a year I need to worry about in my DC pensions.
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Most places with a DC pension won't touch a DB pension of that amount, it's too much paper work.. it may cost you a year or two of that pension for independent financial advise and paper work to get it transfered over.
If you do move to a job that offers a DB pension in the future, that's when I would consider moving it over.
 
slinxy said:
Most places with a DC pension won't touch a DB pension of that amount, it's too much paper work.. it may cost you a year or two of that pension for independent financial advise and paper work to get it transfered over.
If you do move to a job that offers a DB pension in the future, that's when I would consider moving it over.
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it says on the paperwork as it's under 30k I don't need to get financial advice to move it but it seems like a reasonable amount of pension to leave where it is. Using the dubious 4% rule 25k would only pay out 1k a year in todays money so leaving it there seems to makes sense where it's worth 2k - probably over simplified that massively but it's never been part of my calculations for retirement so it's a nice little bonus.
 
slinxy said:
Just worked out my rate of return for my pension since I've started it in September 2021, so 34 months..
7% which is average, it's mainly propped up by the mutral fund that it's invested in.. I didn't switch and add to market trackers until March 2024 (4ish months).

My personal investment returns for the same period is 5%, make's me think if it's all worth it.

My work based shares via SIP and SAYE should start to double up next year and maturaling but it's only a small percentage of my assets. Once it matures or becomes tax free, it's getting cashed out and moved into my personal investments.
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I opened my SIPP in April 2018, messed around with a few individual shares for a few months (Britvic, Sage group, Symantec, .....) made a little profit and then learned about Index funds. In the December I ditched the individual shares and went all in on three Vanguard funds - a split of FTSE UK All Share Index, FTSE Developed World ex-UK Equity Index and Emerging Markets Stock Index.
Since December 2018 (5 and a half years) I've had 94.78% growth. Developed World ex-UK has 106.18% growth by itself. So I've seen 17% growth pa over that time.
I'm under no illusion that will always be the case, but passive investing in Index funds beats active investing with managed funds hands down over the long term.

My workplace pension with Royal London, which is invested with a more conservative approach (Balanced Lifestyle Strategy) has seen 7.6% growth over the same period of time.
 
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slinxy said:
That's a bad idea...
For one would take far too much maths, as nearly everyone dollar cost average into their pension be it monthly, yearly or randomly rather than lump sum it. If a tracker has gone up over a period then your consistently paying it at a higher price lowering your returns.

Also it incites using past performance to chase future gains, if only I had my pension into this rather than this... and once you cashed out or move funds, that's when profit or lost is crystallised.
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It's not a bad idea. It's comparing one type of investment with different exposure and risks and therefore likely different levels of return to another. That is the opposite of a bad idea.
It wouldn't take too much maths at all to do it roughly. You could do it in about 2 minutes by looking at the 3 year performance stats on the fact sheets.
 
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EvilRob said:
It's not a bad idea. It's comparing one type of investment with different exposure and risks and therefore likely different levels of return to another. That is the opposite of a bad idea.
It wouldn't take too much maths at all to do it roughly. You could do it in about 2 minutes by looking at the 3 year performance stats on the fact sheets.
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Go ahead and knock yourself out if your that intreasted... like I said, it gave me the opportunity to buy into a mutual fund at a cheaper rate..
 
slinxy said:
Go ahead and knock yourself out if your that intreasted... like I said, it gave me the opportunity to buy into a mutual fund at a cheaper rate..
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But you then complain about your returns and ask if it's all worth it.
Just whining/moaning I guess.
 
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slinxy said:
nope, if you read the post, it says my pension returned 7%... and my personal investment returned 5% and if that (the personal investment) was all worth it. Two different things as established by the different rates of return.
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Both are bad if those are the total returns over the previous 34 months i.e not compounded annual returns.
 
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