Investor Clinic – 15 years from retirement Anthony is looking for serious growth


#1

This is our second investor clinic, the aim of the clinic is to allow ordinary investors to get feedback from peers on their investments. To comment a
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#2

You have some pretty horrendous funds there. Did you choose them yourself or were they recommended to you?

There are some good ones but you have some shockers there too.

Also how much do you need them to grow by? Or in other words how much do you need to retire in, you can express it in today’s money then we can make some guesses about inflation.

Also are you saving £400 per month including the amount the Government refunds in tax? And are you a lower of higher tax payer?

If you answer these questions it’ll help us when coming up with suggestions.


#3

Hi Derek or @DerekW (hope I’ve got that right, I don’t use Twitter).

They were mostly chosen by my old IFA who has retired.

If I could earn £12,000 a year from this then that would be enough.

I forgot to mention I have a final salary pension that will pay £15,000 when I reach age 65.

I’m a 40% tax payer and I’m putting in £320 to get £400 pension contribution.


#4

If you want your money in retirement to last you around 20 years (if you live that long), if you’re drawing down 5% then you need £240,000.

You’ve got £83,000 already and you’ll save another £50k if you keep up the payments you say you’re making so that’s £133,000 even without any growth.

I think you should be be able to achieve that with some ease.

If you make gains of only 5% per year on £83,000 plus £400 per month contribution, you would have £282,353 after 15 years.

In terms of where you should invest…give a wee while to think about that…


#5

Of your portfolio here is what I would keep.

I’d keep the Standard Life UK Equity fund, M&G Recovery fund, and I’d sell everything else because they’re either dire, middle of the road, the wrong funds for their market (the US funds I mean here), or you could just do better.

For the US I’d buy a tracker though the Aberdeen North American Income Trust that has been reviewed on here is an interesting alternative because income has been shown to do well over time init.

You’ve got Jupiter European fund but the same manager has an investment trust that’s very similar except for one thing, it’s performed a lot better.

As you’re so long term why don’t you buy some private equity. Like DBAG here… http://www.whichinvestmenttrust.com/dbag-a-rich-opportunity-to-invest-with-management-in-the-heart-of-german-industry/

Also I’d buy:
Fundsmith Equity fund
Finsbury Growth & Income
Henderson Diversified Income
Scottish Oriental
Scottish Mortgage
Henderson Euro Trust
Baillie Gifford Japan
Herald Investment Trust


#6

Mohammed’s suggestions are pretty good but to adopt them and add to them a wee bit with asset allocations here’s what I would do:

Standard Life UK Equity fund 8%
M&G Recovery fund 5%
DBAG 8%
Fundsmith Equity fund 8%
Finsbury Growth & Income 8%
Henderson Diversified Income 9%
Scottish Oriental 9%
Scottish Mortgage 8%
Henderson Euro Trust 10%
Baillie Gifford Japan 9%
Herald Investment Trust 8%
Biotechnology Growth Trust 5%
Baring Emerging Europe 5%
Total 100%

This is higher risk portfolio driven from long term growth.

The last trust invests mostly in Russia and Turkey. These are both really cheap markets right now so for a long term investor its the best time to get in.


#7

I don’t think i can better the advice you’ve received here @AnthonyS

I might be tempted to swap the Standard Life fund for the very similar investment trust that is featured on the front page. Reason is that it should perform better with the aid of gearing.

You have more appetite for risk than I do, though I’m older than you but it is a pretty good choice of investments in my opinion.


#8

Thank you all for your suggestions which have been very helpful.

I stumbled across this site by accident, I was searching for a home brewing kit, don’t ask my how I ended up here but I did.

I was really skeptical that this would be worthwhile but it really has. From working out how much growth I need to selecting where it should be invested.

I am going ahead with the recommendations that have come from @Mohammed @AlexBarr @Buck and @DerekW

Thank you all again.


#9

You are very welcome @AnthonyS

My role was more in framing the question but I think for your circumstance, for what you need to achieve the investment feedback you’ve received is spot on and should serve you very well.

Good luck and do let us know how you get on in the future.


#10

Originally published at: http://whichinvestmenttrust.com/investor-clinic-15-years-from-retirement/
This is our second investor clinic, the aim of the clinic is to allow ordinary investors to get feedback from peers on their investments. To comment and get involved there is a comment box at the foot of the article. You need to register to participate. If you haven’t done so already you can register…