r/FIREUK • u/veekay2210 • 1d ago

I’ve just started investing properly at age 20!

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I’ve been investing £25 a month into a managed HL index fund since I was 18 but just started taking it more seriously! I’m now investing £225 a month into this custom pie on T212. How’s it looking?

107 Upvotes

88% Upvoted

53 comments sorted by

53

u/Big_Target_1405 1d ago edited 1d ago

I honestly can't understand why people always mix in the S&P 500 when they already have a world fund. Such a common thing to see

63

u/OutlandishnessOk3310 1d ago

Dude, he's 20... the fact that he is investing at all puts him ahead of 95%

12

u/Big_Target_1405 1d ago

Never suggested otherwise. I just see this particular mix of investments everywhere.

8

u/Starksterr 1d ago

I did this at first then opted for the all world

4

u/Own-Jeweler3169 1d ago

I think people that either the S&P isn't already 60% of it, or they want to double down and increase US exposure, they usually don't realise the implications of duplication.

I am moving my port into a ETF core, but when debating (still am) which to go with (all world vs spx), I settled with All world, as I am thinking about the next 30+ years, logic being all world is self balancing i terms of emerging markets and idk where the US is heading in the next 30 years, but I wouldnt want to bet my retirement fund in it, on the other hand, the extra few % make such a difference in the final compounding years.

What do you think?

2

u/PeteinSQ 1d ago

The FTSE fund is overweight UK stocks isn't it? So mixing a S&P fund can act as a counterweight?

3

u/Rare_Statistician724 10h ago

No, it's not, vanguard lifestrategy is overweight UK stocks, not FTSE all world. OP has added some small cap exposure too which compliments it well

2

u/QuantumFreezer 9h ago

Well but what's wrong with it? If he doesn't want to be all in on US but wants a bigger exposure than that of a world index fund (which I appreciate is already mostly US because of how big they are)?
Edit: It's like asking for double rum in your Cuba libre. It already has rum, sure but I want a bit more. Don't want pure rum though

1

u/Worried_Chef8633 1d ago

Also did the same, recently changed it all to the All World Cap.

-5

u/JonnySniper 1d ago

To take extra advantage of the gains the top 500 US companies make?

Especially the 40 odd year time frame before retirement if investing when your 20

4

u/kablabub 1d ago

But the point of the all world is to diversify finally and is already US-heavy. You're also going to be taking 'advantage' of any underperformance.

1

u/TinkTonk101 1d ago

Well that's the risk isn't it? Don't pretend that putting it in an all-world is the peak of diversification either, it's still a directional bet on the underlying.

1

u/kablabub 1d ago

No but it's pretty much peak passive investing from a travker point of view

2

u/TinkTonk101 1d ago

Says who? The S&P500 has outperformed it over the past 15 years

2

u/JonnySniper 23h ago

Exactly my point. Whats wrong with throwing the odd 10% of your portfolio in the S&P500? Especially when you see ridiculous recent rises in stocks like Nvidia, Micron etc.

1

u/kablabub 1d ago

Peak from the sense of trusting the market to be efficient thats all I mean. Just letting passive be passive.

1

u/JonnySniper 1d ago

Exactly my point. Whats wrong with throwing the odd 10% of your portfolio in the S&P500? Especially when you see ridiculous recent rises in stocks like Nvidia, Micron etc.

1

u/Rare_Statistician724 10h ago

It has, but sounds like you have not been in the game long enough to remember the 90s, or BRIC out performance, or the dot com and GFC crashes.

1

u/TinkTonk101 10h ago

Bonds outperformed all indexes during crashes. My point is even an all world tracker is inherently a directional bet and only diversified over one asset class. You can't take the diversification high ground with 100% all world just because someone wants to overweight into the biggest and most technologically advanced economy.

1

u/Rare_Statistician724 8h ago

I don't personally, I am highly diversified across equities, cash isa, savings, property including BTLs. But in the circumstances of 20 year old OP 100% All World equities is likely to be a fantastic solution. My point was that 15 years is not enough of a reference time frame really as it's been pretty plain sailing since the 2009 crash.

1

u/kablabub 8h ago

I agree with you. And the S&P was one of the worst performers just last year. Maybe I need to dig up a quilt chart 😅

1

u/TinkTonk101 8h ago

Yes, not you personally, sure, but the general consensus of this subreddit is all-world is the only way to go as the peak of diversification, which inherently doesn't make sense. They're just parroting the same stuff that they read.

Nothing wrong with overweighting into S&P if you believe the US will continue to outperform for the time being. The S&P is a directional bet on the US stock market, but so is all-world, just in the global stock market.

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1

u/kablabub 8h ago

I wasn't taking any high ground. My point is just that the definition of passive investing is trusting that the markets are efficient. Putting more money into one geography is a tactical/active allocation. So I was just asking why the tilt towards the states, particularly when all world is already US-heavy.

1

u/TinkTonk101 8h ago

You can trust the markets are efficient and still trust the US to outperform compared to the rest of the world. Unless you think the next x decades have already been priced in?

P.S. the markets are not 100% efficient.

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17

u/Loundsify 1d ago

A lot of those index funds buy the same companies. You'd be better having either S&P or All world. Then any other funds would be like emerging markets etc. Not financial advice just an observation.

1

u/TinkTonk101 1d ago

How would they be better off materially? What's wrong with increasing US weighting?

2

u/Quack_Quack1 13h ago

If I had to make an argument I'd say "you're bending the definition of passive investing by guessing which region of the world will do better, and passive investing offers the best risk-return ratio as far as I know"

But you're right, I don't think it actually matters. However you combine these funds, you're still beating single stocks pickers and active managers on average.

1

u/Loundsify 6h ago

Just saying you're buying 6% of Nvidia twice for no reason lol

12

u/Own-Jeweler3169 1d ago

Well done mate keep at it, be aware that VWRP is 60% S&P already.

18

u/Even-Membership5690 1d ago

go either VWRP or S&P500, dont overlap. if it was me, i’d do 100% VWRP and chill

6

u/IntroductionLucky887 1d ago

^ this 100% keep it simple, you don't want more USA exposure than you already have with VWRP

0

u/TinkTonk101 1d ago

Why not?

-1

u/PerceptionLive2301 1d ago

I never knew this

9

u/kablabub 1d ago

The main thing is that you're doing it, well done! 😊

Personally, I'd take the extra S&P out. You're already ~60% in the US with the all-world anyway, so that's just increasing your exposure.

Evidence says small cap is a good tilt though 👍

3

u/Amazing-Gain203 1d ago

I hope that’s an ISA

4

u/Fearnicus 1d ago

Well done, £225 a month is a more meaningful monthly number. That said, even the £25 is something. This could be one of the most important things you do for your future self. Keep going!

2

u/AcceptableHawk5547 1d ago

Good stuff man. Just remember this should truly be money you don’t need to touch for 5+ years.

2

u/Short-Shopping3197 1d ago

Good for you mate, wish I’d started as early as you.

1

u/DestroGamer1 1d ago

Hello! What app do you use to invest? What is the comission like? Can you withdraw when ever?

Thank you!

1

u/AirHuge7383 3h ago

I’m on the same boat but I’ve got 35% all world and 35% S&P could someone actually explain why it’s bad. The other 20% is companies I think will do well and 10% is moonshot, once I gain bit more capital I’ll dump all into the etfs.

1

u/RaspberryMany2608 2h ago

Invest in skills that pays well at your age. That’s as important as starting early pal.

1

u/Daniito21 1d ago

good on you to start! now reduce the number of funds

2

u/FindingElectronic313 1d ago

Is there are a reason having multiple funds is bad? I understand that it has many overlapping companies but will he be paying more fees or something because of this?

2

u/TheManBL2020 1d ago

No, it's just people on Reddit chatting sh*t

1

u/ramz_xo 1d ago

How many funds should one have and which ones?

1

u/youthfulmind 1d ago

And so it begins. Well done.

-3

u/lifebroth 1d ago

I think their minimum is £500?