PFRDA

Is the Fidelity Cash Pension fund class 5 a good place to put your life savings?

Are these cash funds such a good idea?

Public Comments

1. Depends on your age and attitude to risk. Cash funds are pretty rubbish at growth and a good spread of shares/gilts/fixed interest securities will give a far better potential for growth. PS which dick-head marked this down and why?
2. Depends how old you are == when do you plan to retire ? FTSE & DOW are at all time highs, Interest rates & inflation going up, Oil price creeping up again ... all points to poor Share returns over the short term ... HOWEVER, long term (> 5 yrs) Shares are the way to go. SO, if expect to retire in the new few years, and do not want to manage your own Pension fund (if you do, then you need a SIPP) a 'Cash' Fund may well be a good choice (but watch out for charges !). On the other hand if you do not expect to retire for 10 years or more, an Index Tracker would be the better bet (be prepared for it to go down as well as up). (NB. I checked Fidelity web site, didn't see that specific fund).
3. No.
4. I go with the "Gorilla" tactics (first answer).It is a solid, as opposed to a higher risk/higher gain potential investment. It really depends on your aims - long/short term, risk level, tax position, etc. With out knowing your situation, perhaps a two-way split between that type of fund and something more adventurous is the way to go. If you browse the Daily Mail financial site, below, you can get a better insight into investing.
5. A cash fund is great if you're 80. Otherwise a good chunk of your money should be invested in equities and/or other investments. Keeping your money in cash only guarantees a loss due to taxes and inflation. What you need to do is figure out your goals, risk tolerance and time frame and figure out what your asset allocation should be. Then look at all of your investments and see if you are on track. If you don't like thinking about your investments and don't want to stress about choosing funds and asset allcoation, I highly recommend the target retirement funds. Vanguard and Fidelity both have them and basically it's a fund of funds that's allocated based on your retirement date. It automatically becomes more conservative as you get older so you can literally put your money there and let it just sit and never think about it again. The only drawback is that these funds tend to be a bit conservative so if you're willing to take a bit more risk then you might consider choosing a fund that's aimed at a retirement date which is 5-10 years after when you actually plan to retire. This will keep you more agressive longer. Good luck! http://www.personalfinance101.org/?utm_source=YH&utm_medium=link