PocketSmith and Quarterly Net Worth Reviews

Some excellent questions this week, as always, and with the added bonus of moving the podcast onto YouTube! Join Pete and Rog as they answer questions about finance management apps, investment platform selection and transitional tax-free allowance certificates!

Shownotes: https://meaningfulmoney.tv/QA32

01:39 Question 1

Hi Pete and Roger Thanks so much for all the work you do, I've only found the podcast recently but already enjoying learning more and thinking about things differently. My question relates to saving for retirement and specifically the period leading up to retiring. Nearly all of our (mine and my husband's) pensions are in SIPPs where we have been happy to be 100% equity, in global index funds. We are now maybe 7-10 years from the point where we could retire, and I've been able to research withdrawal strategies to the point where I'm confident managing that when we get there. We have determined our target asset allocation split between equities / bond funds / individual gilts and money market funds for the start point of retirement.

I haven't been able to find much information about the period of transition from 100% equity to the asset allocation we want in place for the start of retirement. Obviously it's a balance between reducing exposure to volatility as we approach retirement and accepting a drag on the portfolio caused by the increasing allocation to cash and bonds and my instinctive (but not evidence-based!) approach would be to gradually move from one to the other over a number of years.

So my question is this - is there a better approach than just a straightline shift from one to the other? How far out from retirement is it appropriate to start making the transition? The best advice I can find online is just to pick whatever makes you feel comfortable and do that but surely there must be some more robust guidance out there? I appreciate it might not be a one size fits all answer but would appreciate your thoughts on how to approach this.

The one piece of advice I do seem to have found is that however we decide to do it, to stick to a predetermined schedule to avoid temptation to try to time the market - does that sound sensible or have I missed the mark on that? Thanks so much for any help you can give. Fran

08:28 Question 2

Hello

I listen to your show when out on walks and find it helpful for somebody who struggles at times with pension planning

I am 55 and myself and colleagues were told we had to leave the Final Salary pension scheme in 2019, the flipside being we would still have employment and our final salary pension would be triggered at reduced age of 50, although we would only get the years paid into rather than the magic 40 years which would give 40/80ths of your final salary.

So, for me , mine was triggered in 2020 and it was around 32/80ths (paid in since age 17), and I still remain in employment.

At this time I received a statement saying my pension had triggered, I had opted for the smaller lump sum (we had two options and some took the larger sum). There was no option to not take a tax free lump sum. I received a statement from the pension provider and it stated I was using 57% of the LTA

Now, since 2024 the P60 I receive from the pension provider annually now shows how much of the LSA I have used, this shows an amount of £153k , which equates to the same 57% , this time of the tax free lump sum allowance of £268k (I have rounded the figures).

However, the actual lump sum I received was £80k - so should I not have £199k left to use up ?

As I got my lump sum prior to 2024 and it is far lower than the standard calculation used to generate £153k used figure , do I not have any protected rights and able to dispute this ? It seems unfair that others who opted for double the tax free lump sum I received will be treat the same as myself regarding what tax free lump sum they can get in future (We all pay into a company DC scheme these past 6 year, with a different provider).

I have read about Transitional Tax Certificates but unsure if they are relevant to my scenario. I was unsure if the onus is on myself to take some action, or if the above is correct and that is how it works.

Any advice would be appreciated and may help others in a similar scenario also.

Many thanks, Jason

13:15 Question 3

Hi both,

Thank you for all the great content, my question relates to financial planning as a couple.

My partner and I are getting married next year and plan to combine finances at that time. We will also be looking to buy our first home in the next few years.

Aside from some lifestyle creep, we are both 'good' with money and have worked with monthly budget systems before. We are looking for a system to help us manage our *total wealth/finances* on a larger scale as opposed to the majority of online finance spreadsheets which focus more on monthly budgeting. Do you have any recommendations for spreadsheets or software to help us keep track of the 'big picture' i.e. emergency fund, pensions, ISAs, investments. We WILL be seeking financial planning but are keen to keep track of this stuff ourselves. We would be happy to update spreadsheets quarterly, but not get bogged down in tracking specifics of bills etc!

Best, Maddie

18:44 Question 4

Hello Pete and Roger,

The older of my 2 sisters has been diagnosed with a terminal illness at the early age of 46 and because of the late stage diagnosis the timescales could be as short as 3-6 months without treatment. Myself and my other sister have been looking through her work pension/ finances to sort out her estate to get everything looked after for her only daughter, who is under the age of 18.

She works for a government department and after reading the small print with her pension/ employment contract her estate would be about £130k worse off if she continued to be on sick leave but employed compared to taking medical early retirement. We have advised and started the process to get the lump sum and early retirement pension for my sister, as she is unlikely to benefit from the higher yearly pension payouts of around 23k vs 15k with £100k lump sum.

My younger sister is applying for power of attorney as my older sister is too unwell to deal with all the admin and is becoming very forgetful with her condition and medication. My sister's entire estate will be around £300k, we are concerned about my niece inheriting such a large lump sum at the age of 18. We are considering setting up a trust so that the money can be fully invested and paid out in smaller staggered lump sums to her on a 6 month or 12 month basis, just to get her used to dealing with larger sums of money and when she needs a Deposit for a house etc this will be available. Are there any reasons not to go down the Trust route and would this even be practical? Are there other options? We have been thrown into the deep end trying to make the best decision and could use your advice.

I'm 38 and if I'd have inherited such a large lump sum at the age of 18, I probably would have blown it on expensive cars and motorcycles and have had some great fun in my 20's, but probably would have little left to show. Regards Mark

24:03 Question 5

Hi Pete and Rog

Long time fan here! Love the accessibility of your information in the pod and the books! I've learnt a huge amount. But....

I still have a probably rather stupid question... I have a SIPP with funds in a Vanguard Global Index fund with Interactive Investor. It's taken a bit of a battering, but I'm hopeful it will grow in the next 10 years!

My question is, how does it grow? I keep reading about interest and the magic of compounding, but it seems to me that there is no interest in an index fund? I dabble for a while with a dividend specific pie on Trading 212 and clearly saw dividends being paid to me on a regular basis, but this doesn't seem to happen with the Vanguard fund. What is it that's compounding?

Please can you explain (as if I was a child!) how and why the fund grows and (hopefully) keeps gaining value over the long term?

Many thanks!

Alex

29:34 Question 6

Hello Pete and Roger,

Great podcast!

We are all very aware of costs eroding returns over time. On reading the Sunday Times review of investing platforms (8th June 2025 entitled, *'Switch investing platform and save £30k*'), this would seem to advocate changing platforms as funds increase to minimise costs. However, what this article doesn't go into is the flexibility on each platform to invest in individual shares / ETFs etc. Please could you and Roger give your insightful views about investment platform selection and particularly keeping with the most cost effective platforms as invested funds grow in value.

Thank you for helping so many of us!

Ivana