My ISS, inspired by FirevLondon, Weenie, the Bogleheads et al, is set out below. This is a work in progress.
Part 1- Investment Philosophy
- Tenet 1: Diversification across world markets, and through multiple asset classes, held with multiple companies
- Tenet 2: Predominantly passive focus to portfolio
- Tenet 3: Reduce fees and maximise tax efficiency through use of ISAs and tax-free savings accounts
- Tenet 4: Hold and grow investments through re-accumulation and compound investing in simpler financial products
- Tenet 5: Monitor mix of investments against target allocation quarterly, investing to rebalance
Part 2 – Goals
- Have an emergency fund of three months income (2019)
- Save £1000/month (2020)
- Be worth £100k (2022)
- Have £100k in equity (2023)
- Be in a position to retire in 15 years (2033)
Part 3 – Allocations
Allocation will initially be set at 70% equities, 15% cash, 10% alternative or exotic assets, 5% property. Equities will counterbalance domestic cash and property holdings by being 40% US, 35% Emerging Markets, 15% Developed Ex-US/ Ex-Euro and 10% Euro.
Part 4 – Accounts, Funds, Taxes & Rebalancing
- Rebalance quarterly through purchases using Swedroe’s 5/25 rule
- Split holdings across multiple providers and platforms to reduce risk
- Exploit tax-free allowances where possible
