Buying NS&I Index Linked Savings Certificates

As I highlighted here National Savings and Investments (NS&I) today released a new issue of both 3 and 5 year Index Linked Savings Certificates. I’ve made use of this and invested around 4% of my retirement investing low charge portfolio into the 3 year 20th issue of these certificates by transferring some cash holdings. This new issue is paying index linking + 1%. This now means that I have 19.6% of my retirement portfolio invested with these tax efficient certificates.

2010 Quarter 1 Retirement Investing Portfolio Review

Edited 06 June 2010: I have found more exact data allowing me to determine benchmark returns to the day. I have therefore updated the data in this post to reflect this. As the blog has developed I have also changed the method used to calculate the returns as I have learnt more accurate methods. I started with:
- [assets at end of period – assets at start of period – new money entering portfolio] divided by [assets at start of period],
- then used the mid-point Dietz which was a more accurate method,
- and now use Excel's XIRR function for anual returns. If it is not a full year I then adjust XIRR by the PRR (Personal Rate of Return) = [(1+XIRR Annualised Return)^(# of days/365)]–1.
Apologies for the confusion but I'm learning here too.
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The first quarter is over so it’s time to benchmark my low charge retirement investing portfolio against a simple Strategic Asset Allocation that anybody could implement in next to no time. It’s a basic stock/bond asset allocation with the stocks portion being represented by the FTSE 100 total return (capital & income) index and the bond portion being represented iBoxx® Sterling Liquid Corporate Long-Dated Bond Index total return (capital & Income) index.

My Current Low Charge Portfolio – April 2010

Buying (New money): Since my last post I have continued living frugally and saved 81% of my net earnings and pension salary sacrifices. Total new money entering my retirement investing Low Charge Portfolio was around 1.5%. These were allocated as follows: 69.5% to cash, 4.6% to UK equities, 6.4% to international equities, 1.2% to index linked gilts and 18.3% to UK commercial property. This money was invested both outside of any tax wrappers and also within a pension.

The government keeps spending our taxes to inflate house prices

I am yet to buy a house as I believe that house prices are still overvalued. I try and demonstrate this monthly with the house affordability ratios that I present. This current government however seems intent on using our taxes to prop up this property market bubble. This offends me because my (and your) taxes are being used against me to keep me out of the market and also as an electioneering tool.

Gold Priced in USD – March 2010 Update

Within my Retirement Investing Strategy I currently hold 3.5% (up from 3.2% at the last USD gold update) of my portfolio in gold with a targeted holding of 5%. Gold is the only portion of my portfolio that does not provide a yield (dividends, interest etc).