Pension Fund Allocation

[1eyeonthefuture]

Any opinions on the following - I met with a financial advisor to look at the current allocation of my pension and his advise given my age (early 40's) was that I was being too conservative with respect of my allocation.

Previously had 100% of allocation attributed to IFunds 4.
I have amended same to -- Goodbody Dividend Income 4 @ 40% / IFunds 5 @ 20% / Goodbody Global Leaders @ 20% / IFunds Equities @ 10% & Technology Indexed @ 10%.

As you can see I'm now quite exposed to equities and while I am comfortable with the increased risk and am willing to take a long term view on the funds I was hoping to get some opinion on the above mix if possible?

Thanks

 

[Steven Barrett]

What is your attitude to investment risk and the ups and downs that go with it? Investment term shouldn't be the only barometer of assessing how much risk exposure someone should take with their investment. If you are not comfortable with increased risk, don't take it. The trade off is lower returns but if that is what you are comfortable with, that is fine.

On the funds themselves, do you need 5 different equity funds? How much actual diversification will you actually have? There will be overlap between stocks in those funds.

There are extra costs there too as there are additional layers of costs. Both Goodbody and New Ireland have to be paid and the iFunds range uses a range of different fund managers, so there is more costs there too.

Each advisor has their own philosophy and strategy in recommending investment strategies. Just because there are different views, doesn't make any particular one wrong but I think you can have a cheaper and simpler approach.


Steven
www.bluewaterfp.ie

 

[Marc]

Have to agree with Stephen about the complexity here. Some of the funds have very short track records which makes any kind of meaningful analysis virtually impossible but here is your portfolio over the last 6 months compared to just picking a suitable IFunds portfolio. However, you are 20 to 25 years away from "normal" retirement date you are being recklessly conservative. You have capacity for loss and should be up at around 100% IFunds Equities for the next decade at least. Volatility isn’t a risk here you are contributing regularly so short term market swings make no difference to you at this time in life.
It’s later in life you need to be more diversified.

 

[PFS7979]

Quick observation. IFunds and Goodbody are both Actively Managed. I believe a passive fund should be utilised in your mix. Prime range are Passive funds with lower management charges.