Budgeting with no pension (2 Viewers)

[rangi]

Having said that. we are debt free, got some dosh earning a better interest overseas than here in the UK. We live within our means, but we don't scrimp, if we want something enough we'll go and get it.
Both our daughters are mortgage free so anything we leave them will be a bonus I suppose. We enjoy what we have earned.

 

[colinw]

@Judgemental , we have friends who bought a house in Brighton 2 years ago for 350,000 . it is on the market now for 550,000 with lots of interest .
My own house is worth less than I paid for it in 2007 !
If you are considering selling up in London , possibly buy 2 properties on the coast and rent one out . good luck with your decisions .

 

[Robert Clark]

with the FTSE falling from over 7000 to early 6000

Exactly - it lost 5% in 2015
Lloyds Bank recently quoted me (from memory) 2.5% over base rate (0.5%) to borrow £1 million +
So if the banks can't lend money at 5%
And the FTSE lost 5% - how can a 5% investment be low risk?
Especially if you want an investment which generates an income ?

^{_{Subscribers  do not see these advertisements}}

 

[The Wino]

If there is a 5% low risk investment please tell me!!. Average investments may have performed well over the years but I would invest in a tracker rather than one single fund lower charges and most managed funds don't do a lot better some a lot worse. What everyone is having trouble getting used to is how low interest rates look when inflation is so low. With 0% inflation your capital is staying the same value if inflation was 5% it would be worth 5% less each year and you would have to put 5% of your interest into the capital pot to keep its value in real terms.If you want a punt look at trigano shares well over double this year but hindsight is a wonderful thing!!

 

[HymerB544]

As always, this sort of topic generates a good debate, though it is a bit like arguing how many angels can stand on a pinhead. We both retired four years ago and with pretty good works pensions, but if you enjoy a good lifestyle and are still fit and like the good things in life, it is easy to spend more when you have more time to spend it. For us, the kids will inherit the house, the car and the van, the rest is ours.

 

[colinw]

China having a wobble on its stock market this morning , with knock on effects around the world !

^{_{Subscribers  do not see these advertisements}}

 

[CWH]

the kids will inherit the house, the car and the van, the rest is ours

We didn't bother having kids, so ..... it's ALL ours

 

[Bailey58]

Hi Robert , I am not a financial advisor . If you speak to one they will explain everything to you . one of my own funds is called SEI balanced fund . investments work differently to bank accounts in that they can lose value as well as gain , but if you have time to leave your money invested they will out perform ordinary savings .

I had a dilemma whether to buy rental property or to invest some money , the fact that my investments could be cashed in whenever I wanted and could give a similiar 7% return outweighed the rental option ( and I have experience in the rental market ) .

Everybodies needs and expectations are different , so take plenty of advice and good luck .

We had similar thoughts when we retired twelve years ago. We had the proceeds from the sale of our business to invest and considered buy to let but the thought of the hassle of possibly obnoxious tenants and paperwork involved in annual returns and eventual CGT put us off. We invested through a Financial Advisor in Corporate Bonds initially where we draw 5% of the capital annually and ISA's over the next few years as one or two other long term savings matured. The value fell in the 2008 debacle where the footsie fell below 3000 but today although inflation has of course eaten away at the value the capital is around 5% up on the original investment whilst we continue to live on it. Our retirement pensions are an added bonus.

 

[Langtoftlad]

I was chatting to someone who is firmly in the 'live now' camp as I try to resist the "sensible" advice of an IFA who wants me to 'save for the future' - their opinion is...

• whilst you're younger, fitter & more interested in "life" you will need to spend more now enjoying the good years & will naturally need less when leisure activities are less important.
• As we can't know how many "good" years we've got, it makes sense to enjoy "now".
• Financial Advisors have a vested interest in encouraging & keeping you saving or investing with regards fees, commissions & other charges. If you're out spending your money rather than buying financial products then they aren't making any money.

So whilst trying to keep a sensible balance - I'm leaning towards the spend it now side .

^{_{Subscribers  do not see these advertisements}}

 

[Forestboy]

We've got 3 friends who are currently all fighting serious cancers and its unlikely any will survive.
Strangely enough all 3 are extremely wealthy and are all in the save save save we'll do it next year category.

We retired in our early 50s with the intention of travelling for 10 years and then see how we're fixed. Well 10 years this year and we're still going strong.
We took my private pension early as it couldn't go to Jan. We sold our business and invested most of the money which gives us an income which Jan or the kids will get. After 5 year travelling we sold the big family home built ourselves a nice new small home and bought 2 renters so another small income to pass on.
We aren't rolling in cash but have a decent income to do most of the things we want. We've had an amazing 10 years been to 5 continents over 70 countries and got friends all over the world and memories that will last forever.
Can't take it with you as our 3 friends sadly are now finding out. All 3 are much better off than us financially but all 3 wish they'd done what we have.
Very Sad.

 

[gus-lopez]

Lloyds Bank recently quoted me (from memory) 2.5% over base rate (0.5%) to borrow £1 million +
So if the banks can't lend money at 5%
And the FTSE lost 5% - how can a 5% investment be low risk?
Especially if you want an investment which generates an income ?

They're robbing you Euribor ( currently 0,058% ) +0,75%
Average rate here so my neighbours tells me.

 

[colinw]

Financial Advisors have a vested interest in encouraging & keeping you saving or investing with regards fees, commissions & other charges. If you're out spending your money rather than buying financial products then they aren't making any money.

Fair point , but they also have a vested interest in making your money grow or they lose your business !

^{_{Subscribers  do not see these advertisements}}

 

[The Wino]

Fair point , but they also have a vested interest in making your money grow or they lose your business !

What they never offer you is a percentage fee on anything over the bank savings rate (no profit no fee!!). Probably best to find one who works on an hourly fee basis they then should refund any commission on investments.

 

[Bailey58]

• Financial Advisors have a vested interest in encouraging & keeping you saving or investing with regards fees, commissions & other charges. If you're out spending your money rather than buying financial products then they aren't making any money.

Fair point , but they also have a vested interest in making your money grow or they lose your business !

Quite agree, we have an annual meet with our man and, thankfully not often, he advises a move from a particular investment that is not performing well into one that is.

 

[Langtoftlad]

I'm happy you're happy with your financial adviser .
In the bad old days they were renowned for getting customers to buy & sell their investments regularly because that upped their fees.
I'm sure things have got better & more regulated since then - but with so much [free] information available on the web these days, I'm not sure these IFA's can do better than you can do yourself.
No-one can see the future - not even highly paid fund managers which is why they get it wrong more often than getting it right. Tracker funds tend to perform better than the majority of actively managed funds in the long term (and are cheaper too).
A well balanced portfolio is ideal but whether an IFA can choose a stock or a sector better than you, or me, or the media, or anyone else - I'm not so sure.
[Just for clarity - I don't avoid the financial sector at all but I self manage because for the fees IFA's charge for advice they'd have to be wondrous for me to get back those fees in improved returns]

^{_{Subscribers  do not see these advertisements}}

 

[Bailey58]

If you have the time and inclination to DIY that's fine but I have better other things to do than study the financial markets and check on the performance of the flavour of the month fund manager. More than happy with the fees I pay to keep the investments earning. I place my IFA on the same level as my accountant when I was earning. Another advantage of Corporate Bonds together with the ISA's is that we haven't paid direct taxes for ten years.

 

[colinw]

What they never offer you is a percentage fee on anything over the bank savings rate (no profit no fee!!). Probably best to find one who works on an hourly fee basis they then should refund any commission on investments.

I'm sorry I don't understand that , I am lucky that I got sound advice and trusted a wealth management company to look after my money .

 

[The Wino]

What I mean is that all the financial advisers seem to promise they will maximise your gains but none offer services with their fees based on results rather than advice. Your wealth managment company will still charge for their services even if the advice is rubbish and your shares plummet!

^{_{Subscribers  do not see these advertisements}}

 

[colinw]

@The Wino , ah yes I understand what you mean . fund managers charge a percentage of any profits , usually the higher the percentage the better the fund manager / previous results . Yes the management company would still charge for their services .

 

[The Wino]

I suspect the fund managers also get paid largely not dependant on results

 

[colinw]

Apologies if the talk of investments has gone off topic .
Martin Lewis has personally used peer to peer lending site zopa to invest money and was receiving 5% , but now receives 4.6% .
He seems to know what he's talking about and obviously practises what he preaches . check out his website for more info .

^{_{Subscribers  do not see these advertisements}}

 

[Minxy]

Apologies if the talk of investments has gone off topic .
Martin Lewis has personally used peer to peer lending site zopa to invest money and was receiving 5% , but now receives 4.6% .
He seems to know what he's talking about and obviously practises what he preaches . check out his website for more info .

... but he's got money to spare and whilst 'losing' it will smart it won't necessarily hurt whereas for those on here losing money WILL hurt a lot!

 

[colinw]

Yes good point , if money cannot be risked in an investment then it needs to be saved in a savings account .

 

[Speve]

If you do your research and get a good IFA they are worth their fees we have an excellent one and has done us proud over the time we've been retired.

^{_{Subscribers  do not see these advertisements}}

 

[Bailey58]

We all like to haggle, well maybe not all of us, but, whilst I'll attempt to get the price down on anything I'm buying, eventually you do get what you pay for. Whether that's a new tv, a motorhome or financial services if you have to go back they'll remember you and treat you accordingly.

 

[Brightonian]

Just read through the whole of this thread and feeling quite depressed.
I am 58 will not have my mortgage paid up for another 6 years and have a small pension that i had to freeze for about 10 years and only started it back up 12 years or so ago.
Don't have any real savings as such so i guess retirement won't be any time soon for me.

 

[CWH]

Just read through the whole of this thread and feeling quite depressed.
I am 58 will not have my mortgage paid up for another 6 years and have a small pension that i had to freeze for about 10 years and only started it back up 12 years or so ago.
Don't have any real savings as such so i guess retirement won't be any time soon for me.

Maybe not, but look on the Brighton side - at least you have your moho so your holidays are all paid for!

^{_{Subscribers  do not see these advertisements}}

 

[Brightonian]

Maybe not, but look on the Brighton side - at least you have your moho so your holidays are all paid for!

Yes CWH your not wrong, life isn't so bad sometimes i just miss the positive and dwell too much on the negative!

 

[ianthebuilder]

Just read through the whole of this thread and feeling quite depressed.
I am 58 will not have my mortgage paid up for another 6 years and have a small pension that i had to freeze for about 10 years and only started it back up 12 years or so ago.
Don't have any real savings as such so i guess retirement won't be any time soon for me.

Brightonian ,, I was ( am) in virtually the same boat as you! Then the ex left as well !! So I decided after a little while that being fed up about it all shouldn't be an option !! Sold the house, paid her off, paid all debts, bought a used Motorhome, and just got on the ferry to Spain !! You have your mh already, you also have a house, a job and who knows perhaps even a good partner, not to mention at least some sort of pension ! I for one think your in a pretty healthy financial position ! You should be laughing mate,, I got nothing and I've never been happier!! God knows what's gonna happen to me but at least you have a plan !! Good luck to you ,, smile !!

 

[Brightonian]

Well the last 2 posts from @CWH and @ianthebuilder have put a different take on it, much more positive!

What do i have?
A House
Quite a good job ( self employed window cleaner with plenty of work)
My health
A lovely wife (who puts up with me!)
4 lovely grand children
A paid for mh
And a holiday in the summer going down to Lake Constance in the mh.

Lesson learnt, time to look on the bright side!!

^{_{Subscribers  do not see these advertisements}}