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Savings and Investments thread

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  • edited February 2020
    Well taking a start point of about 3 weeks ago, my £170,000 stock/fund portfolio is now worth £154,000 so a 9.4% loss in days.  I’m just glad I took my final salary pension as a pension.  I couldn’t imagine sitting invested with drawdown and seeing near 10% wiped off my future in a few days.  

    Will it come back, I expect some stocks will recover quickly. Others may take years. As a Former Lloyds employee, I am overweight in Lloyds which is helping drag me down. 
  • FTSE All Share index fallen from 4200 to 3800 in the last few days. 
    Roughly a 10% fall.
    I'd say a good investment opportunity, but you shouldn't take financial advice from a football forum.
  • Well taking a start point of about 3 weeks ago, my £170,000 stock/fund portfolio is now worth £154,000 so a 9.4% loss in days.  I’m just glad I took my final salary pension as a pension.  I couldn’t imagine sitting invested without drawdown and seeing near 10% wiped off my future in a few days.  

    Will it come back, I expect some stocks will recover quickly. Others may take years. As a Former Lloyds employee, I am overweight in Lloyds which is helping drag me down. 
    Hopefully it will stop falling at some stage. 
  • edited February 2020
    I agree with Will Self. I remember him on Question Time just after the banking crisis in 2008/09 & he said that instead of banks paying interest on savings that "savers" should have to pay banks to look after their money. This way people wouldn't be so keen on having thousands of ££££ in the bank just sitting there when instead it could be being used more productively for the economy.

    I have many clients who think nothing of having £50k, £100k or more sitting on deposit "just in case". As a financial advisor I of course recommend that you have a "safety net" in case of emergencies. There are no hard & fast rules on how much this should be but a rule of thumb of between 3-6 months of usual monthly expenditure is about the norm. I usually advise £10k -£20k or so. Obviously depends on the individual & their circumstances but when a retired couple on a good pension (many of my clients have pension income of £40k pa +) have more than this then you wonder why they are happy receiving less than 1%pa "just in case". 

    I think the main problem is that a lot of people don't understand investments. They have heard about stockmarket "crashes" & pension scandals and think the best & "safest" place for their money is in the bank, often splitting it between 2 or 3 different banks as they dont want to exceed the £85k protection limit. The fact that (in the UK) the Government haven't let a financial institution fail for many many years escapes them.

    Will be interesting to see what the B of E do in a couple of weeks time. More than half of The City institutions now think that interest rates will be cut next month. 
    If you want some idea why people don't want to pass their money to you to invest in the stock market, look no further than the last couple of days.

    Months and months of slow, careful increases in my funds wiped out - and more - in a couple of days after the "kids" in the City come into work on the Monday and decide to have a panic about the coronavirus. Yet even the medical experts aren't clear about how bad the virus will be - and thankfully at the moment it doesn't seem to be killing a high proportion of those who get it - so how on earth can these market traders justify their fire-sale of stocks on this scale?

    As I write, the Dow Jones is down another 850 points tonight and still falling. Another bloodbath on the horizon tomorrow as we simply follow the Americans lower again.

    At times like this its hard not to think that investing in the stock market is just fools gold..
    World stockmarkets fell around 10% between Sept 2018 and Jan 3rd 2019. Since then they are up over 20%. Falls will be short lived but the gains will be longer. 

    You will always hear of the big "crashes" but you never hear of the slow recoveries that take place soon after. 

    During the week of Black Monday in Oct 1987 the FTSE100 & the Dow Jones saw falls of 20%........but both markets finished the year higher than they started.

    Anyone pulling out now is a fool. Now is the time to be investing.

    One of the reasons why there has been panic selling is that a lot of companies in China are shut & at the moment can not export their goods. Hi tech companies & motor manufacturers cant get their products out to Europe & the US. Nothing to do with city wide boys just taking their red pencils out & devaluing stocks.

    HTH.
    Some interesting comments on my original posting. Thanks.

    I'm old and ugly enough to have lived through a large number of "crashes". And yes, the market has always recovered. But equally relevant is how long it takes to do so.

    Some interesting stats from hoof_it_up_to_benty and Addickted above. I well remember the FTSE hitting record highs on the eve of the Millenium. And then taking 15 years to get back to that level.

    I see the market is now down another 200 points today. Kiddies obviously still feeling "nervous" despite the fact we have so far only had 15 cases of coronavirus in this country. Quality stocks, including the likes of Unilever, being slaughtered along with the rest. If this carries on for much longer, you can kiss goodbye to any gains for the rest of the year as the market simply struggles to get back to where it was.


     

  • I agree with Will Self. I remember him on Question Time just after the banking crisis in 2008/09 & he said that instead of banks paying interest on savings that "savers" should have to pay banks to look after their money. This way people wouldn't be so keen on having thousands of ££££ in the bank just sitting there when instead it could be being used more productively for the economy.

    I have many clients who think nothing of having £50k, £100k or more sitting on deposit "just in case". As a financial advisor I of course recommend that you have a "safety net" in case of emergencies. There are no hard & fast rules on how much this should be but a rule of thumb of between 3-6 months of usual monthly expenditure is about the norm. I usually advise £10k -£20k or so. Obviously depends on the individual & their circumstances but when a retired couple on a good pension (many of my clients have pension income of £40k pa +) have more than this then you wonder why they are happy receiving less than 1%pa "just in case". 

    I think the main problem is that a lot of people don't understand investments. They have heard about stockmarket "crashes" & pension scandals and think the best & "safest" place for their money is in the bank, often splitting it between 2 or 3 different banks as they dont want to exceed the £85k protection limit. The fact that (in the UK) the Government haven't let a financial institution fail for many many years escapes them.

    Will be interesting to see what the B of E do in a couple of weeks time. More than half of The City institutions now think that interest rates will be cut next month. 
    If you want some idea why people don't want to pass their money to you to invest in the stock market, look no further than the last couple of days.

    Months and months of slow, careful increases in my funds wiped out - and more - in a couple of days after the "kids" in the City come into work on the Monday and decide to have a panic about the coronavirus. Yet even the medical experts aren't clear about how bad the virus will be - and thankfully at the moment it doesn't seem to be killing a high proportion of those who get it - so how on earth can these market traders justify their fire-sale of stocks on this scale?

    As I write, the Dow Jones is down another 850 points tonight and still falling. Another bloodbath on the horizon tomorrow as we simply follow the Americans lower again.

    At times like this its hard not to think that investing in the stock market is just fools gold..
    World stockmarkets fell around 10% between Sept 2018 and Jan 3rd 2019. Since then they are up over 20%. Falls will be short lived but the gains will be longer. 

    You will always hear of the big "crashes" but you never hear of the slow recoveries that take place soon after. 

    During the week of Black Monday in Oct 1987 the FTSE100 & the Dow Jones saw falls of 20%........but both markets finished the year higher than they started.

    Anyone pulling out now is a fool. Now is the time to be investing.

    One of the reasons why there has been panic selling is that a lot of companies in China are shut & at the moment can not export their goods. Hi tech companies & motor manufacturers cant get their products out to Europe & the US. Nothing to do with city wide boys just taking their red pencils out & devaluing stocks.

    HTH.
    Some interesting comments on my original posting. Thanks.

    I'm old and ugly enough to have lived through a large number of "crashes". And yes, the market has always recovered. But equally relevant is how long it takes to do so.

    Some interesting stats from hoof_it_up_to_benty and Addickted above. I well remember the FTSE hitting record highs on the eve of the Millenium. And then taking 15 years to get back to that level.

    I see the market is now done another 200 points today. Kiddies obviously still feeling "nervous" despite the fact we have so far only had 15 cases of coronavirus in this country. Quality stocks, including the likes of Unilever, being slaughtered along with the rest. If this carries on for much longer, you can kiss goodbye to any gains for the rest of the year as the market simply struggles to get back to where it was.


     

    Can't see what will halt this fall? Unless there is some positive news re dealing with the virus it appears we have a long way to go given the global effect. A lot of people will be severely affected...
  • FTSE now down 280. Dow has opened lower, now down about 800 points. 

    This market is going to take a long time to recover.
  • Well taking a start point of about 3 weeks ago, my £170,000 stock/fund portfolio is now worth £154,000 so a 9.4% loss in days.  I’m just glad I took my final salary pension as a pension.  I couldn’t imagine sitting invested with drawdown and seeing near 10% wiped off my future in a few days.  

    Will it come back, I expect some stocks will recover quickly. Others may take years. As a Former Lloyds employee, I am overweight in Lloyds which is helping drag me down. 

    wish you hadn't posted that !!  Just checked mine, over roughly the same period have lost 4%, about 16k. But there is the problem, there are always swings and roundabouts and I try not to check too often as over time it picks up again. It is a concern though and that is what you have to weigh up. The inflexibility of a final salary scheme but the guaranteed pay-out every month against the greater flexibility of say a SIPP but the risk of it using value.
  • Well taking a start point of about 3 weeks ago, my £170,000 stock/fund portfolio is now worth £154,000 so a 9.4% loss in days.  I’m just glad I took my final salary pension as a pension.  I couldn’t imagine sitting invested with drawdown and seeing near 10% wiped off my future in a few days.  

    Will it come back, I expect some stocks will recover quickly. Others may take years. As a Former Lloyds employee, I am overweight in Lloyds which is helping drag me down. 
    You must be very heavily weighted in equities. My pension fund has fallen around 5% this week, but I have around 30% in bonds/property.

    Not sure when this "correction" will stop & things recover, but it will. As pp have said, the FTSE100 is not a good gauge of UK shares. Big companies like BP make up a large proportion of its value & I think about 6 or 7 shares make up 20% of the overall total.
  • Well taking a start point of about 3 weeks ago, my £170,000 stock/fund portfolio is now worth £154,000 so a 9.4% loss in days.  I’m just glad I took my final salary pension as a pension.  I couldn’t imagine sitting invested with drawdown and seeing near 10% wiped off my future in a few days.  

    Will it come back, I expect some stocks will recover quickly. Others may take years. As a Former Lloyds employee, I am overweight in Lloyds which is helping drag me down. 
    You must be very heavily weighted in equities. My pension fund has fallen around 5% this week, but I have around 30% in bonds/property.

    Not sure when this "correction" will stop & things recover, but it will. As pp have said, the FTSE100 is not a good gauge of UK shares. Big companies like BP make up a large proportion of its value & I think about 6 or 7 shares make up 20% of the overall total.
    That was my thought too, and quite high volatility stuff for a pension fund. Worth looking at that @RaplhMilne, although not a good time to sell anything, IMO
  • In my SIPP I'm down just under 3% over the last week. Helped that I sold a few shares a couple of weeks back, also I have a number of Gold funds (majority is in Investec Global Gold) that are picking up some of the share losses. Got a few Royal London Government funds that are also helping.

    As always spreading the risk helps, I see too many people say they have spread the risk over say 15 funds, but when you look at them the majority are very similar investments. 

    @ralphmilne - If you are drawing your final salary pension I assume you are over 60, if so it sounds like your SIPP investments need reviewing, you shouldn't be down nearly 10%, you must be far too heavy in Stocks.
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  • I see the Dow Jones has dropped 1,191 points tonight, its biggest ever one day fall. Poor kiddie traders don't like the uncertainty, apparently!

    Falls of this magnitude are just bonkers and I can only feel sorry for those whose pensions are invested in the stock market. 
  • Points drop, not even in the top 20 for percentage drops. 2008 was much worse. But we’ll need to see where it bottoms out. 
  • edited February 2020
    The inherent liquidity of equities (ie the fact they can generally be sold in a heartbeat) is precisely what attracts many to the asset class, but also in turn what frightens others off because they can get a true real time valuation of their holdings.

    Property by comparison is highly illiquid but ask yourself one night, "What is my house worth if I HAD to sell it tomorrow?" Go through that mental exercise in the midst of some geopolitical or other shock and equities relatively won't seem so scary and moreover unlike property, most investors don't own equities on a highly levered basis.
  • Points drop, not even in the top 20 for percentage drops. 2008 was much worse. But we’ll need to see where it bottoms out. 
    Exactly. It's not the number it's the percentage. On black monday 1987 the Dow Jones fell less than today (500 points) ........but it was a fall of 22%. That puts things in focus I think.
  • FTSE down about another 270 points today as the youngsters in the City decide we are all doomed.

    What really irks me is years worth of gains are wiped out in days. 

    Yes, I know the market will turn. But our fall today will probably drag the Dow lower tonight and so it goes on.

    I have a funny feeling it will take years for the market to regain its previous high 
  • FTSE All Share index fallen from 4200 to 3800 in the last few days. 
    Roughly a 10% fall.
    I'd say a good investment opportunity, but you shouldn't take financial advice from a football forum.
    Things could get a whole lot worse, so I'd advise against seeing a 10% fall as an opportunity right now. Gold is at record highs, and I suspect could be set to rise higher.
    But as you say, you shouldn't take financial advice from a football forum.
  • edited February 2020

    Bit worried as I have all my pension monies in a SIPP.

    Question - How does an Annuity work? For example if I had say £300k in my SIPP and needed £15k per annum to live off my Pension is it as simple as saying that the £300k could buy me an Annuity paying me £15k per annum for 20 years?

    Edit. - just done a bit of research myself and I see it isn't that simple and probably won't raise as much income as I require. So it will have to sit tight in the SIPP and I'm sure things will improve eventually.

  • JamesSeed said:
    FTSE All Share index fallen from 4200 to 3800 in the last few days. 
    Roughly a 10% fall.
    I'd say a good investment opportunity, but you shouldn't take financial advice from a football forum.
    Things could get a whole lot worse, so I'd advise against seeing a 10% fall as an opportunity right now. Gold is at record highs, and I suspect could be set to rise higher.
    But as you say, you shouldn't take financial advice from a football forum.
    How many sheds do you have?
  • JamesSeed said:
    FTSE All Share index fallen from 4200 to 3800 in the last few days. 
    Roughly a 10% fall.
    I'd say a good investment opportunity, but you shouldn't take financial advice from a football forum.
    Things could get a whole lot worse, so I'd advise against seeing a 10% fall as an opportunity right now. Gold is at record highs, and I suspect could be set to rise higher.
    But as you say, you shouldn't take financial advice from a football forum.
    How many sheds do you have?
    Got a couple made out of Stone.
  • edited February 2020

    Bit worried as I have all my pension monies in a SIPP.

    Question - How does an Annuity work? For example if I had say £300k in my SIPP and needed £15k per annum to live off my Pension is it as simple as saying that the £300k could buy me an Annuity paying me £15k per annum for 20 years?

    Edit. - just done a bit of research myself and I see it isn't that simple and probably won't raise as much income as I require. So it will have to sit tight in the SIPP and I'm sure things will improve eventually.

    Depending on your age, a £300k fund would get you around £15k pa gross income - that's for life. So quids in if you live for another 30 years but a real bummer if you die in 5 years!
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  • Bit worried as I have all my pension monies in a SIPP.

    Question - How does an Annuity work? For example if I had say £300k in my SIPP and needed £15k per annum to live off my Pension is it as simple as saying that the £300k could buy me an Annuity paying me £15k per annum for 20 years?

    Edit. - just done a bit of research myself and I see it isn't that simple and probably won't raise as much income as I require. So it will have to sit tight in the SIPP and I'm sure things will improve eventually.


    https://www.sharingpensions.co.uk/annuity_rates.htm

    Gives some idea of what each £100k earns you with either flat or escalation and at different ages, also if you want a spouse pension. Annuities as @bobmunro has stated are for life, so it's always a gamble as to how long you'll live!

    To get 15k from £300k you'd pretty much have to have a flat pension and no spouse pension (assuming taking at 65).


  •   JamesSeed said:
    FTSE All Share index fallen from 4200 to 3800 in the last few days. 
    Roughly a 10% fall.
    I'd say a good investment opportunity, but you shouldn't take financial advice from a football forum.
    Things could get a whole lot worse, so I'd advise against seeing a 10% fall as an opportunity right now. Gold is at record highs, and I suspect could be set to rise higher.
    But as you say, you shouldn't take financial advice from a football forum.
    I think Gold will go a little higher, might be a good time to raid the Jewellery box and dig up the sovereigns though  :D
  • NSandI have confirmed their rates are reducing, if anyone has any cash etc in there.
  • Rob7Lee said:

    Bit worried as I have all my pension monies in a SIPP.

    Question - How does an Annuity work? For example if I had say £300k in my SIPP and needed £15k per annum to live off my Pension is it as simple as saying that the £300k could buy me an Annuity paying me £15k per annum for 20 years?

    Edit. - just done a bit of research myself and I see it isn't that simple and probably won't raise as much income as I require. So it will have to sit tight in the SIPP and I'm sure things will improve eventually.


    https://www.sharingpensions.co.uk/annuity_rates.htm

    Gives some idea of what each £100k earns you with either flat or escalation and at different ages, also if you want a spouse pension. Annuities as @bobmunro has stated are for life, so it's always a gamble as to how long you'll live!

    To get 15k from £300k you'd pretty much have to have a flat pension and no spouse pension (assuming taking at 65).


    Yes agreed - if you wanted to retire earlier, inflation proofing included, and a spouse pension then £300k would get you less than £10k income.
  • thanks for all the replies. Seems an Annuity is not for me !!
  • thanks for all the replies. Seems an Annuity is not for me !!
    I did tell you this before you transferred your pension. 

    Not only are you tied into an annuity it also dies with you (unless you build in a spouse's benefit which means you get less pa than your £15k)......whereas in your Sipp drawdown pension the remaining fund passes tax free UK your spouse (before the age of 75).

    I agree.........you shouldn't take financial advice from a football forum, you should see an IFA 😉
  • thanks for all the replies. Seems an Annuity is not for me !!
    I did tell you this before you transferred your pension. 

    Not only are you tied into an annuity it also dies with you (unless you build in a spouse's benefit which means you get less pa than your £15k)......whereas in your Sipp drawdown pension the remaining fund passes tax free UK your spouse (before the age of 75).

    I agree.........you shouldn't take financial advice from a football forum, you should see an IFA 😉
    Any good ones you could recommend, Golfie?
  • FTSE down about another 270 points today as the youngsters in the City decide we are all doomed.

    What really irks me is years worth of gains are wiped out in days. 

    Yes, I know the market will turn. But our fall today will probably drag the Dow lower tonight and so it goes on.

    I have a funny feeling it will take years for the market to regain its previous high 
    It's not years of gains that are being wiped out......the FTSE is today around where it was in Dec 2018 after if fell 12% in 3 months (remember that....probably not). Then last year those falls were more than made up. It will happen again. I dont know where or when this current downturn will correct itself but it will. In the short term 2 things will happen. 1) investors/traders will see a chance to make a profit (as a pp mentioned) and will start buying selected stocks. 2) We will soon be at the end of a quarter & like car dealers there will be some "squaring off" for their quarterly figures and so the market will rise.
     
    FWIW. The FTSE100 had been moving between 7500-7700 since the New Year. Earlier today it was around 6500. My bet it that it will be above 7000 by the summer.......maybe sooner. And back to a range between 7200-7500 by the end of the year.


  • I think it will take longer than that to get back to 7000. Especially after listening to the interview referred in this tweet.

    But every cloud, and that. It looks like Donald Trump has bet his re-election campaign on Golfie calling it right...:-)


  • I think it will take longer than that to get back to 7000. Especially after listening to the interview referred in this tweet.

    But every cloud, and that. It looks like Donald Trump has bet his re-election campaign on Golfie calling it right...:-)


    China have a stated ambition to have GDP of at least 6%pa. It's all bollox of course & manipulated by the Government so it will be interesting to see what figures come out at the end of the year, esp if this quarter is a negative one.
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