Long Term Investments

[TheMagpie]

Hello TheSilverForum,

What is everyone’s favourite means of investing long term? I would like to start investing into index funds around 15% of my take home pay but not sure if that’s a good idea to do due to the current climate? All replies are much appreciated.

Kind Regards,

TheMagpie

[HawkHybrid]

invest in yourself long term.

 

HH

[TheMagpie]

4 minutes ago, HawkHybrid said:

invest in yourself long term.

 

HH

I work on myself every day but I’m thinking in terms of personal finance thanks for your reply

[HawkHybrid]

17 minutes ago, TheMagpie said:

I work on myself every day but I’m thinking in terms of personal finance thanks for your reply

 

financially, improving your understanding of the markets is one of the best ways of creating and

protecting wealth. all markets change, it's being able to balance your risk that will save you. any

investment is about knowing when to buy and when to sell, and how would you know that?

 

HH

[Kman]

There's been a lot of stocks discussions on the forum lately - I linked a thread below

Personally I don't think you can go far wrong with a silver ETF atm , I'm pretty bullish it will go close to $40 in the next two years, I can't imagine an index doubling but who knows

I was never a "silver to the moon" person either, haven't bought any in the past 6 years, still don't hold any physical I prefer gold for that, but for currency in a silver etf for the next couple years makes all the sense in the world

My main investment and holding is in domain names though 

 

 

[TheMagpie]

6 minutes ago, Kman said:

There's been a lot of stocks discussions on the forum lately - I linked a thread below

Personally I don't think you can go far wrong with a silver ETF atm , I'm pretty bullish it will go close to $40 in the next two years, I can't imagine an index doubling but who knows

I was never a "silver to the moon" person either, haven't bought any in the past 6 years, still don't hold any physical I prefer gold for that, but for currency in a silver etf for the next couple years makes all the sense in the world

My main investment and holding is in domain names though 

 

 

Thanks for your reply, a lot of the replies in that thread are relying on single stocks which I’m not too keen on

[Martlet]

Making regular contribution to an index fund is the simplest way to do long term investment.  It wont make you rich in itself but should give a solid inflation beating outcome over longer periods 10yr+.  Everything else offers better returns with associated risk.  Get started on that, then have some side investments in something more adventurous. 

If you have an employer with pension fund have a look at that, tax efficient and they may match or better the contributions. 

[Pete]

Take full advantage of the tax breaks in a SIPP.
Chose a company that gives you full control / access on-line and feed whatever funds take your fancy.
With stock prices hammered by CV_19 it ought to be ( but no guarantees ) a great time to invest in the right funds.
Leave the stock picking to "experts" so maybe look at funds of funds but have some diversification.
Buying monthly means you get the benefit of catching some dips but it is impossible to time the market over time so just go with the flow.

[Robb]

5 hours ago, TheMagpie said:

Hello TheSilverForum,

What is everyone’s favourite means of investing long term?

I don't know what everyone's is but mine is Real Estate 😉

Not very liquid so I can't spend it on a whim  (like on a new 992 Porsche Targa)

Love the leverage....Little $ can move Big $$$$$

Tax benefits are outstanding

Can generate cash flow

In America you can do tax free trades with "like properties"

It is more fun driving around looking at properties than scanning the Wall St Journal or Barron's

Can get your hands dirty on a project if you want.  Or not.

[Stacktastic]

Queens Beast sets. Wont make me rich, but I can't see them getting any cheaper. Would love a 1 oz gold set!! 

The stock market is not a great place atm. (depends on the stock).
I will pull the trigger on mining stock soon though, when i work out how to use it. Sit it out & then go for a few more. 

I am starting to look at crypto at the moment, but I am not sure about that as its no different to any other new currency.

Wine is always a good one & art but you need to know what your doing, but you can get robbed or it damaged.

I also want a commercial property of some sort, but have no money. Waiting for hyper inflation & desperate people lol. 

[SierraWhiskyMike]

I'm a big fan of index funds due to the low cost. You can buy a lot of them on a free platform like trading 212 in an ISA but I mostly use the Vanguard SIPP to buy them.

If you're not sure what you're doing, I'm also a fan of robo-investing platforms. I used to use wealthify, which was pretty good. Now I use wealthsimple. The good thing about them is that you get loads of diversification on a balanced portfolio with very little money needed. If you do want to use wealthsimple, PM me and I'll send you a referral code so we each get some money (I think up to £5k?) managed for free for a year. I hear good things about nutmeg too.

I actually started buying PMs this year to widen my portfolio and give a counterbalance to shares that wasn't just cash. Ideally, I don't want my eventual retirement date to be dictated by stock market performance that year, so diversification over the next 20-30 years is key for me while I build up. Plus I like feeling like a pirate with my small stack of bullion coins. Might as well have some fun, right?

A good book to check out is "How to own the world", which you can find via Amazon (or if you're feeling kind via this cheeky affiliate link that earns me 5p from Jeff B's share:  https://amzn.to/306iq7m ). The author talks about owning as many diverse assets as you can and gives simple examples of how to do that to stand a chance of beating inflation. Controversially, I thought it was a better read than Rich Dad Poor Dad for UK audiences but I liked that book too. Can be read in a couple of days easily.

Also, the subreddit r/FIREuk is a good place to look, even if FIRE isn't your thing.

[TheMagpie]

1 minute ago, SierraWhiskyMike said:

I'm a big fan of index funds due to the low cost. You can buy a lot of them on a free platform like trading 212 in an ISA but I mostly use the Vanguard SIPP to buy them.

If you're not sure what you're doing, I'm also a fan of robo-investing platforms. I used to use wealthify, which was pretty good. Now I use wealthsimple. The good thing about them is that you get loads of diversification on a balanced portfolio with very little money needed. If you do want to use wealthsimple, PM me and I'll send you a referral code so we each get some money (I think up to £5k?) managed for free for a year. I hear good things about nutmeg too.

I actually started buying PMs this year to widen my portfolio and give a counterbalance to shares that wasn't just cash. Ideally, I don't want my eventual retirement date to be dictated by stock market performance that year, so diversification over the next 20-30 years is key for me while I build up. Plus I like feeling like a pirate with my small stack of bullion coins. Might as well have some fun, right?

A good book to check out is "How to own the world", which you can find via Amazon (or if you're feeling kind via this cheeky affiliate link that earns me 5p from Jeff B's share:  https://amzn.to/306iq7m ). The author talks about owning as many diverse assets as you can and gives simple examples of how to do that to stand a chance of beating inflation. Controversially, I thought it was a better read than Rich Dad Poor Dad for UK audiences but I liked that book too. Can be read in a couple of days easily.

Also, the subreddit r/FIREuk is a good place to look, even if FIRE isn't your thing.

Thanks for that I'll definitely take a look always looking out for good reads!

[SierraWhiskyMike]

On 14/07/2020 at 07:42, Stacktastic said:

I am starting to look at crypto at the moment, but I am not sure about that as its no different to any other new currency.

Wine is always a good one & art but you need to know what your doing, but you can get robbed or it damaged.

I also want a commercial property of some sort, but have no money. Waiting for hyper inflation & desperate people lol. 

Crypto is hard. I'm looking at it like I know that the future will be a crypto currency but at the moment they're like those early MP3 players and I don't know which one is actually going to become the iPod. I'm staying out of that game for a while I think, too uncertain!

Commercial property can be done at low money through REITs (Real Estate Investment Trusts) that basically work like shares in a portfolio of commercial properties but I haven't dipped my toes into that one yet. Going to wait and see how society changes after 'rona. Might be worth having a look but I don't know that much about them in practice, just the theory.

[Stacktastic]

26 minutes ago, SierraWhiskyMike said:

Crypto is hard. I'm looking at it like I know that the future will be a crypto currency but at the moment they're like those early MP3 players and I don't know which one is actually going to become the iPod. I'm staying out of that game for a while I think, too uncertain!

Commercial property can be done at low money through REITs (Real Estate Investment Trusts) that basically work like shares in a portfolio of commercial properties but I haven't dipped my toes into that one yet. Going to wait and see how society changes after 'rona. Might be worth having a look but I don't know that much about them in practice, just the theory.

Yes i kind of see crypto as search engines in the dot.com bubble. One might be prevalent, but I can honestly see it becoming a government/banking controlled one as they just cant keep fiat forever & they have not really intervened with what should be a HUGE threat!! Mybest guess is that has not come out yet. 

Not sure about investment trusts but I am aware of them. I was hoping to get one or two half priced beach huts if things get that bad.

Sit on it, rent them & then sell them for the normal price. 

[vand]

60/40 portfolio is still a good starting point.

Max out your pension allowance up to 40k/year if you can. 

15% is a good start if you begin aged 21 and want to retire aged 67, but honestly, if you want to get ahead I would encourage you to try bumping it up. A 20% saving rate gets you a 40 year working career, 25% a 33yr working career, and if you can save 33% you can shortern your working career to 25 years.

 

The most important thing is just to do it. Start now, optimize later. Even a crappy underperforming, high fee portfolio beats doing nothing.

[Bullionaire]

38 minutes ago, TheMagpie said:

Thanks for that I'll definitely take a look always looking out for good reads!

The little book of common sense investing is a good book by Jack Bogle (of Vanguard). 

 

I think it's never a bad time to get started investing in index funds. Especially as you'll be pound cost averaging (putting some money in each month from your pay) which means you don't really have to worry about the stock market dropping, as it just means cheaper shares for You! 

As others have said, use a tax advantaged account like a SIPP or Stocks and shares ISA. I have a SIPP with vanguard and a stocks and shares isa with cavendish which are both great. Keep costs low and pick a diverse fund (maybe s an p 500 or a global index fund)

[TheMagpie]

1 minute ago, Bullionaire said:

The little book of common sense investing is a good book by Jack Bogle (of Vanguard). 

 

I think it's never a bad time to get started investing in index funds. Especially as you'll be pound cost averaging (putting some money in each month from your pay) which means you don't really have to worry about the stock market dropping, as it just means cheaper shares for You! 

As others have said, use a tax advantaged account like a SIPP or Stocks and shares ISA. I have a SIPP with vanguard and a stocks and shares isa with cavendish which are both great. Keep costs low and pick a diverse fund (maybe s an p 500 or a global index fund)

I'll note them all down on my list of reads and I'll have a look into it. How much would you recommend putting into a stocks and shares ISA? I'm currently saving for a house deposit where would you put money for that?

[vand]

good book recommendations given out here.

I'll second "How to own the world" - fab book that very much chimes with my overarching investing philosopy.  Be very careful about dabbling in spreadbetting though.. it can be a slippery slope.

Rich Dad Poor Dad - good read for mindset, slightly corny though, and too biased towards real estate.

If you want to become a 2nd level thinker I recommend Howard Marks' "The Most Important Thing". 

Listen to the Meb Faber podcast too. Start at #001 and listen to them all sequentially. You will know everything there is to know about how to invest by the time you've caught up.

[SierraWhiskyMike]

7 minutes ago, vand said:

The most important thing is just to do it. Start now, optimize later. Even a crappy underperforming, high fee portfolio beats doing nothing.

100% agreement here! Inactivity is so much worse than poor portfolio selection as long as there is an attempt to diversify.

60/40 equities/funds is a bit too cautious for me personally, purely because I have half of a public sector pension that serves a similar purpose to bonds in a portfolio so I can take bold risks, but you can't go far wrong if you decide this is the right balance for you. It's thousands of times better than just cash right now and will be so for at least the next 10 years I suspect.

[Bullionaire]

13 minutes ago, TheMagpie said:

I'll note them all down on my list of reads and I'll have a look into it. How much would you recommend putting into a stocks and shares ISA? I'm currently saving for a house deposit where would you put money for that?

A cash LISA would probably be the best bet for the house savings. Safe and boring, but you still get the government bonus (I believe you have to have the LISA for at least a year before the house purchase). I had a help to buy ISA for my house savings (but these aren't around anymore) and further savings in cash in my current account for the house deposit. You don't want your house savings in shares or other risky assets (assuming you're planning on buying the house in the next decade)

Whilst saving for a house, I am also putting away money into investments for the long term (retirement) in my two investment accounts I already mentionned. I put roughly 30% of my earnings into stocks and shares isa for retirement, 10% into the SIPP for retirement, 20% into house savings (as I already have a decent deposit saved up) and the rest is my money for whatever.

 

Ooh, and I also put enough in my work pension, to get the max employer contribution.

[TheMagpie]

I'll have a look into that are they still doing the cash LISA? I heard Martin Lewis mentioning that there was a deadline of a few months back?

[Bullionaire]

1 minute ago, TheMagpie said:

I'll have a look into that are they still doing the cash LISA? I heard Martin Lewis mentioning that there was a deadline of a few months back?

That was the help to buy ISA. The Lisa is still live

[TheMagpie]

1 minute ago, Bullionaire said:

That was the help to buy ISA. The Lisa is still live

Great I'll take a look thanks for the help

[SierraWhiskyMike]

6 minutes ago, TheMagpie said:

I'm currently saving for a house deposit where would you put money for that?

I'd use a LISA or help-to-buy ISA if you managed to get one. This is because of the bonus to pay fees and the fact that you don't want volatility in something that's needed for a short-term (less than 5 years) target.

Investments are for 5yrs+ really unless you keep to a conservative portfolio. Some would say 10 years is the shortest reasonable investment period to get decent returns.

It sounds like you have quite a lot of different goals on your mind, based on your comments. These all take a different approach to investing your earnings so you'll probably benefit from doing the reading then planning out your timeline before you commit. How long do you want to wait to buy a home? Are you married? Will you have kids? What are your career prospects? Do you want to be financially independent - if so, what lifestyle do you want to have? There's a lot to think about.

That will help you work out how much to contribute to the house deposit per month, how much to invest for long term (and how) and what portfolio balance you want to end up with. Then it's a case of committing and I strongly recommend using standing orders to keep you committed. Automate everything and worry about nothing. You get used to not having the spending money quite quickly and you can check your progress every couple of months.

Also consider if PMs are a hobby or a serious part of your portfolio. For me, they're a commodity asset and although my target sale date is decades away I know that I would consider selling some coins if prices skyrocket. It also means that while I dabble in collector coins out of speculation they aren't a focus for me and I won't spend much more than the price of a Britannia per oz for a collector's item. I also stick to state sponsored coins because I want the option to cash out later without too many problems. If PMs are a hobby then you should really do your savings and investments separately to buying; if an investment, probably look at portfolio balance to include your PMs stack.

[StackerCollector]

Gold, silver, dividend stocks and reinvesting the dividends. Recently calculated what I will get from my German and UK pension. Let's call it a rude awakening  Don't want to be dependent on government pension or support when I retire, so I started a while ago to put money aside for high-yield dividend stocks. Even though they might not pay any dividend in the next 1-2 years I am looking to get blue chips like BP, Royal Dutch, CocaCola, Gazprom, German insurance companies, IBM, Cisco and a dozen more as soon as the price for these stocks dips badly. 2009 levels would be nice. Including mining stocks, not for the dividends but the potential return. Ever since I bought a few shares of Gazprom and Mobilnye Telesystemi and received around 8% dividends for the former and +10% for the latter I am hooked.

Depends on your investment time frame of course. For me it's 25 years of continually adding to the portfolio and never taking any money out.