Beginning my UK 'stache with my first dealing account

[lizfish]

My First Dealing account sounds like a book for under 5's ....

I took some great advice from the excellent UK-based blog monevator.com  (which I evaluated myself and in no way hold the writer responsible for the results ;-) ) and will be staching from next month into the Vanguard LifeStrategy fund http://monevator.com/vanguard-lifestrategy/. It's an older post, but the comments are current and it's still a reasonable choice for a beginner I think.

I chose Interactive Investor because I can share the platform fees with my DH, they are all set up for the new era of brokering (i.e. up front charges and no funny-business in the background) and their regular investment fees are just £1.50 per trade. Got the second half of my ISA allowance and will be shoving in equal amounts til the end of the tax year from my oversized emergency fund. I now know slightly more about investment than I did 2 months ago, but I am am far from well-educated just yet. From what I can work out, if you want to make a start on (very) passive investing, you can do a lot worse than start here.

And starting is kind of the point. This is the very first time I have invested apart from my pension contributions. And I never really felt very connected to those because I always thought understanding pensions and the stock market was a bit beyond me (it was the 15-million pages of gumfph they give you to read and sign that did it). And actually it isn't. Our portfolios will develop along with our knowledge. The most important thing is to start.

I must admit my brain is having a meltdown at the thought of investing £1,400 in one go every month for the next 4. But I know it's the right thing to do and I can change the amount any time I like.  I can afford to lose that money, and I don't need it for 10-15 years. By which time I hope it, and its friends, will be providing us enough income to provide our basic needs. So bring it on.

[gmuk]

Hi lizfish. I am almost EXACTLY in the same boat. UK-based (London), Monevator fan, also just opened my first dealing account (Hargreaves Lansdown, recommended by Monevator for single-fund accounts). I've setup my monthly payments to max out my Stocks & Shares ISA from now until the end of the UK tax year as well. Yay!

I agree I've still got a lot to learn about investing, but thanks to MMM (and Monevator), I am much less intimidated than I was just a few months ago. And the Vanguard Lifestrategy funds seems like a great place to start (80% equity stocks), until I get a little more comfortable (or maybe for good, who knows).

Good luck to you!

[abliviax]

Yep starting is a huge step.  I started 7-years ago, and keep learning. ETFs are great and make investing easier to get started with.

Understanding yourself is pretty important to, (and you won't get that without some skin in the game) - how much risk are you willing to take?

I learned in 2008, to only invest in companies which I had personal experience with (Chipotle, Costco, Amazon, Nuance (Voice Control on Cell phones)) and knew that my ownership was worth something (otherwise I would sell when things got hot).

If you ever want to sell your broad market ETFs (to go to cash) -- just look at the stock market from 1920s to now and think about WW1, WW2, and so many other scary things that happened during that time.

Remember to buy more when things go down, and spread your buying out over time (which is often natural) so that you don't buy at highs.

[lizfish]

I bit of an update for me. I wussed out the first month and only invested £500 but then came to my senses and maxed out the remainder of my ISA allowance over the next three months to be in before the end of the tax year (so about £5,700 in total). Which feels great. That was a lump sum for me, so future monthly contributions won't be so large, but I'm determined to get my earnings up so hopefully I'll be contributing £1000 a month in 3-6 months.

Trying to not check the account so often. Thinking of changing my password to something horrible so I can't remember it off the top of my head! But I guess checking is natural when you're new to investing. DH has made a slower start to his 'stache but he didn't have a windfall to invest and is likely to be able to invest more on a monthly basis than me in the short term while I get my income up.

Our savings rate is currently around 30% between index funds and pensions. It'll be 40% once we're done saving for the building work in 5 months and that money goes to mortgage payoff instead. (I suspect not everyone agrees that mortgage payoff is staching but that way I look at it saving interest is pretty much the same as earning it. And I hate the mortgage)

For every extra £400 (approx)  I earn and 'stache, our savings rate increases by 10%. At 65% we're down to 10 years out from retirement. Seems like a long time and no time at all when you look at it. Wish we'd started earlier.... ;-)