Caution is the key word in watching MacDonald money

Published on Friday 19 September 2008 21:40

ANGUS MacDonald (50) is a solicitor who runs a small family law firm in Aberfeldy. He is married and has two children – Robert, who is 24 and employed as a chartered surveyor in Edinburgh, and Susan, who is a medical student in Aberdeen. MacDonald's wife, Margaret, is a full-time housewife but also does some voluntary work for a local charity.

Over the years, MacDonald has accumulated an ad hoc collection of self-employed annuity contracts and personal pensions, the majority of which have been last-minute purchases before the tax year end. As a consequence there is no real structure to his investment strategy. He has recently consolidated his various pensions into an investment only self-invested personal pension (Sipp) with Hornbuckle Mitchell – an independent trustee company. To his surprise the current value of his fund is 300,000.

He is seeking advice on how to construct an investment portfolio that will meet his long-term objectives and match his risk profile. He plans to retire at 60 and would ideally like to have an income in retirement of around 50,000 per annum. He is naturally cautious but realises that he may have to increase his exposure to risk to meet his long-term goals. He plans to contribute 10,000 a year into his Sipp.