The 2017/18 (Tax) Year Performance

So, the end of the tax year has passed and I have pushed as much as possible into the various tax efficient wrappers (ISAs & pensions) to put me in as strong a position as possible.

So first of all some of the stats for the year:

The Benchmarks

Index	Performance
FTSE-100	-1.8%
FTSE-250	2.7%
FTSE-All	-0.9%
S&P500	13.1%
Dow Jones	18.7%
VWRL	1.2%
VHYL	-4.1%
GBP/USD	12.2%

So really a fairly mixed bag out there. The US did rather well last year but not enough to make any real impact on VWRL. The pound strengthened quite considerably over the year (just mood swings around Brexit, or something more – who knows).

So if you had followed the Go T’ Pub ISA approach and just shoved money into VWRL you may have been very disappointed! Now let’s get into a bit more detail.

Company Pension

So the company pension is still, in the grand scheme of things, in its early life. The amount going in each month is still a (relatively) large amount compared to the size of the pot. Ultimately the overall value goes up so I don’t really take much stock on the growth numbers for this. The main thing is that my company put a lot of cash into it, so free money I won’t turn down.

Performance: -0.8%

So down a fraction. Not that bad given the UK markets, but this is a fairly global portfolio (not in the standard fund!). To be honest, I really am not too worried about this the money is going up each month and it all helps. It is too soon (for me anyway) to get any meaningful performance so I will just continue to watch and wait. Let’s see how it looks in a few years time.

Personal Pension & ISA 1

So, how did my IFA do? I am sure this will be of interest to many people – was it worth it for him to take a cut of every single contribution I make?

Personal Pension: 12.4%

ISA 1: -1.1%

So given the make up of the portfolio (I will update my portfolio page at some point!) I am happy with this. No, it is not as high as the US but they are not bad performances.

The first obvious one to me is that my IFA is far better with larger value pots than smaller. I will have to talk to him about the poor performance again in my ISA.

Overall the pension is very good especially as this includes a large injection of more funds right before the tax year end. The cynics out there may say he has underperformed the US market, however only about 20% of my pension allocation with him is in the US market.

If he keeps this performance up then by the time I get to 55 I will breach the LTA, even with the increases, and assuming I stop putting any more in when I hit 50. A nice place to be, but it won’t stop me contributing now, I will worry about the LTA as and when it is likely to affect me.

ISA 2 (also IFA managed)

So the second ISA is the most complicated with 3 sub portfolio’s with different goals inside it. For simplicity here I am tracking only the overall performance, remembering that it also pays out income monthly. The contributions still form a significant amount of the total value of the portfolios as it goes in each month, so I continue to expect this to under perform based on my method for tracking for some years.

Performance: -3.1%

Ok so a poor performance there really. However, it also threw out almost 2% trailing dividend. The main thing for me here is that it is achieving what I wanted out of it – this is not a growth portfolio but a cash flow portfolio.

It is now starting to throw out a noticeable amount of money each month which helps given the ongoing battles I have with HMRC and their inability to work out how much tax I should pay.

Go T’ Pub ISA

So, how did the GTP ISA do, compared to VWRL’s 1.2%?

Performance: -1.0%

Well this was the first year of running so wildly affected by the in month swings, and also of course the impact of CTY, so a comparison against VWRL direct is a little unfair yet.

The funny thing is, do I really care? The short answer is no! CTY is sitting there as my cash reserve – as long as it grows faster than my actual cash, and after a couple of years never goes below the original value of cash I will be happy.

VWRL will just keep ticking up and throwing out money for me to go to the pub (or out for a meal etc.) and I won’t really change what goes in (I would like to increase it at some point as the ideal world would let me fill it completely) so I will carry on firing and forgetting. Very nice 🙂

My actively managed ISA

So last, and by no means least, how did my actively managed ISA do? I have been trying to move this to have less individual shares, and a combination of Investment Trusts and Trackers. This is still very much work in progress and will reduce the potential performance (or stop it from being so bad maybe?), but as the value of the portfolio has increased over the years I am getting less comfortable with quite such a large portfolio – I know I should have faith in my own ability but when you can read so much out there that shows passive is most likely to win, who am I to argue.

After the last rebalance I am almost there so I can play again, more trackers to be purchased.

Performance: 4.9%

The dividend income was reinvested in the portfolio which helps to bolster the returns. The trailing yield was a shade under 4% as it was last year, which indicates to me that I should probably think about a maximum of 3.5% withdrawal rate.

So whilst this didnt repeat last years stellar returns, it continues to move upwards, and at a faster rate than my spreadsheet plans for (4%) which is nice. Whilst I would like this to go up faster (not necessarily the 44%, but maybe 10%), it is still going up.

The dividend income this year was not as much as I would have liked, but still more than last year, even with the rebalancing. The gap between contributions and value continues to grow (in the right way!) as dividends get reinvested so I continue to be happy with this.

Premium Bonds

So for a bit of fun I thought I would also look at the returns on my premium bonds holding. In total it returned 0% – no winnings at all for the year yet again.

Not good, but then these do form part of my cash reserves so preservation of capital is important.

Conclusion

If I look at where I finished the year, I really can’t believe quite how well the values have gone up over one tax year. When I set my (undisclosed) target of what I wanted the fund to get to, I never once thought I would get there.

And I didn’t get there, however I wasn’t that far off which amazes me. If I continue to build wealth at this rate I will hit my number by 2025, regardless of what my spreadsheet tells me!