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Savings and Investments thread

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  • Rob7Lee said:
    I think in general dividends are going to be cut or disappear for a while, and thats only right.

    I was disappointed to see Aon have cut staff salaries by 20% (all be it they say temporarily) but still paying the dividend to shareholders. Something wrong there, it was the staff who created the dividend!
    Sorry but can't agree with you on that one.

    To me one of the most basic reasons for buying equities is for the income they generate. If that dries up, what’s the point of holding them  particularly given the risk that is attached to owning individual shares?  I posted somewhere a few pages back that it was estimated dividends paid out this year will fall to £50 billion from £75 billion last year and that potentially could have a huge impact on the market.

    If companies find themselves in a position where their prospects and results suddenly dive eg Shell it is understandable for them to stop paying a dividend. But you can see from the market's reaction to Shell over the last few days they don't like it.
  • edited May 2020
    Rob7Lee said:
    Rob7Lee said:
    Premium bond day...... and nowt for me, on a bit over 30k holding, £75 for Mrs Rob7Lee with max holding.

    Think i'm going to find a new home for mine and sell the lot, I had a pretty good run last year and beat the average, but this year since dropping the holding a bit it hasn't been great.
    £25 for me, but have been on a relatively good run of late.

    Would be interested to know where the new home might be. I've considered it several times but never really found a good answer, if 100% security against losses is a criterion. Banks busy reducing their "high" interest accounts right now, of course.
    Not sure yet, I have other cash so it won't necessarily all be in cash, will have to put any cash in my wife's name to keep to paying no tax on any interest, otherwise I may as well put it under the mattress!

    The odd fellows/Unity Mutual pay 2.25% for 5 years, but not sure I want to tie it up that long and still not a great return.

    @golfaddick I assume they are the usual, i.e. guaranteed capital safe, but not guaranteed return? One's like Investec's 3 year plan, pays up to 10.5% if above the initial index, money back if not? Right now seems a sensible place......... IFA only though  ;)

    EDIT

    I'm tempted to put some in the FTSE 100 8 Year Kick-Out Plan 2

    Bit higher risk, but if you leave the full 8 years and the FTSE is above the initial level returns capital plus 80%, can kick out from year two onwards at 10% per annum (again if above). If below 60% then you lose 1% for every 1% fall. But this one isn't FSCS protected so maybe not.....
    Yes, there are 2 distinct types. The deposit based ones are FSCS protected but are usually cash based & so are taxed in line with income tax. The investment based ones are not protected & you could lose everything, but in reality are protected with a 45%-50% ''floor" , ie the FTSE (or whatever index you are tracking) has to fall by that much before you start losing £ for £. These  are CGT based, so as long as you keep your investment inline with the annual exemption then there should  not be any tax to pay on the returns. The minimum term is now around 6 years, but there are 8 & 10 years ones as you say. Many different versions as well & the ones I've been advising on over the past few years have been "defensive" ones where they pay out even if the FTSE has fallen over the period. Usually kick out after 2 years, and every year thereafter, with the observation level reducing by 5% pa, so that on the 6th year the Index has to be above 80% of its initial level to pay out. It's been a great hedge over the past 2 years, with Brexit etc, but didnt bank on the FTSE falling 25% in little over a month !

    You know where to come if you need advice....😉
  • Rob7Lee said:
    Rob7Lee said:
    Premium bond day...... and nowt for me, on a bit over 30k holding, £75 for Mrs Rob7Lee with max holding.

    Think i'm going to find a new home for mine and sell the lot, I had a pretty good run last year and beat the average, but this year since dropping the holding a bit it hasn't been great.
    £25 for me, but have been on a relatively good run of late.

    Would be interested to know where the new home might be. I've considered it several times but never really found a good answer, if 100% security against losses is a criterion. Banks busy reducing their "high" interest accounts right now, of course.
    Not sure yet, I have other cash so it won't necessarily all be in cash, will have to put any cash in my wife's name to keep to paying no tax on any interest, otherwise I may as well put it under the mattress!

    The odd fellows/Unity Mutual pay 2.25% for 5 years, but not sure I want to tie it up that long and still not a great return.

    @golfaddick I assume they are the usual, i.e. guaranteed capital safe, but not guaranteed return? One's like Investec's 3 year plan, pays up to 10.5% if above the initial index, money back if not? Right now seems a sensible place......... IFA only though  ;)

    EDIT

    I'm tempted to put some in the FTSE 100 8 Year Kick-Out Plan 2

    Bit higher risk, but if you leave the full 8 years and the FTSE is above the initial level returns capital plus 80%, can kick out from year two onwards at 10% per annum (again if above). If below 60% then you lose 1% for every 1% fall. But this one isn't FSCS protected so maybe not.....

    You know where to come if you need advice....😉
    Will drop you a message, will do a couple I think.
  • Oof. Pity Warren Buffet isnt on this thread. He clearly thinks we didnt hit bottom when FTSE 100 went down to 5000....https://www.theguardian.com/world/2020/may/03/warren-buffett-dumps-us-airline-stocks-saying-world-has-changed-after-covid-19


  • Oof. Pity Warren Buffet isnt on this thread. He clearly thinks we didnt hit bottom when FTSE 100 went down to 5000....https://www.theguardian.com/world/2020/may/03/warren-buffett-dumps-us-airline-stocks-saying-world-has-changed-after-covid-19


    I'm still an investor in BRK as, if anyone knows when to buy, he will.  And we won't know until after he's done it.  

    He was sitting on USD 129bn in cash before this crisis, saying there was nothing to buy and getting criticised for holding cash.  Investors were starting to suggest he give money back, much like HSBC investors were before 2008.
  • Oof. Pity Warren Buffet isnt on this thread. He clearly thinks we didnt hit bottom when FTSE 100 went down to 5000....https://www.theguardian.com/world/2020/may/03/warren-buffett-dumps-us-airline-stocks-saying-world-has-changed-after-covid-19


    I'm still an investor in BRK as, if anyone knows when to buy, he will.  And we won't know until after he's done it.  

    He was sitting on USD 129bn in cash before this crisis, saying there was nothing to buy and getting criticised for holding cash.  Investors were starting to suggest he give money back, much like HSBC investors were before 2008.
    How does one invest in him? Does he offer retail investment vehicles?
  • You can buy BRK.B shares - currently at USD 181.  They are slices of his main share BRK.A, currently at USD 274,000 per share.

    Charlie Munger, his side kick, said a week or so ago that they hadn't been buying as "many of our investors have 90% of the wealth tied up with us, and it's too risky at the moment."

    It's one of a few reasons why I've been hedged for a couple of weeks, though that was starting to hurt middle of last week!
  • Worst Recession in history, double the number of un-employed, and restrictions in place potentially for months to come. Yet, the market is creeping up..... WHY.. .?  
  • Worst Recession in history, double the number of un-employed, and restrictions in place potentially for months to come. Yet, the market is creeping up..... WHY.. .?  
    Because the market sold off weeks ago. It always falls on rumours & uncertainty & rises on truth & clarity. 
  • Worst Recession in history, double the number of un-employed, and restrictions in place potentially for months to come. Yet, the market is creeping up..... WHY.. .?  
    Because the market sold off weeks ago. It always falls on rumours & uncertainty & rises on truth & clarity. 
    And it's sucking you back in before another heavy fall.
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  • Worst Recession in history, double the number of un-employed, and restrictions in place potentially for months to come. Yet, the market is creeping up..... WHY.. .?  
    Because the market sold off weeks ago. It always falls on rumours & uncertainty & rises on truth & clarity. 
    And it's sucking you back in before another heavy fall.
    I tend to agree, with this conclusion. Yes, we have had a massive correction, but I think this could go lower. Especially in Banking, Entertainment, and travel related stocks. 
  • I did our 19/20 S&S ISA's when the market bottomed in March.

    But I've held fire on this tax year's as the market picked up & I reckon it will fall at some point.
  • My pension portfolio down just 7% from its January high. Same level as it was less than 12 months ago  
    Now down just 4% from its January high. Not bad going considering the FTSE100 is still around 22% down
  • edited May 2020
    mendonca said:
    My workplace pension is invested in:

    Standard Life Managed Pension Fund4BALANCED II UNIVERSAL

    It does look like you can change this fund on the Standard Life site. Any tips? In my mid 30's. 
    Sorry, only just seen this post.

    Very average fund & I'm sure you could do better, but then I'm not a lover of insurance companies own managed funds. I have 3 clients with a Standard Life Sipp but I dont know if you would be offered the whole fund range that they have access to. You might be limited to only 20 or 30 funds.......or less. 
  • The announcement of two weeks quarantine is another kicking to airlines and travel. Were not doing much business, now likely to do none. 
  • mendonca said:
    My workplace pension is invested in:

    Standard Life Managed Pension Fund4BALANCED II UNIVERSAL

    It does look like you can change this fund on the Standard Life site. Any tips? In my mid 30's. 
    Sorry, only just seen this post.

    Very average fund & I'm sure you could do better, but then I'm not a lover of insurance companies own managed funds. I have 3 clients with a Standard Life Sipp but I dont know if you would be offered the whole fund range that they have access to. You might be limited to only 20 or 30 funds.......or less. 

    Thanks Golfie. I moved the pension fund from the very average to 

    Baillie Gifford Managed Pn Fund

  • Thats a better fund. BG have some very good funds.
  • if you get a bonus at work is it a no brainer that you put it in your pension and avoid the tax - assuming you don't need the extra cash now obviously - or do you pay the tax eventually anyway when you start drawing your pension? a pretty basic question i guess but one i'm not 100% certain of the answer to - is it just if you draw a lump sum that you pay tax on your pension later on or???... 
  • DOUCHER said:
    if you get a bonus at work is it a no brainer that you put it in your pension and avoid the tax - assuming you don't need the extra cash now obviously - or do you pay the tax eventually anyway when you start drawing your pension? a pretty basic question i guess but one i'm not 100% certain of the answer to - is it just if you draw a lump sum that you pay tax on your pension later on or???... 
    The first 25% you take from your pension is tax-free (up to the current LA  - so max around £270k). Anything after that is taxed......or should I say is taxable. If you have no other income you can then take up to your Personal Allowance (£12,500) without paying any tax. 

    Pensions can be very beneficial to those who are higher rate taxpayers during their working life but basic rate taxpayers in retirement (40% tax relief going in but only 20% tax going out). Similarly for basic rate /nil rate - although once taking the state pension there is little scope before you are being taxed.


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  • Would you clever people consider the construction industry being a strong buy following the earlier announcement?
    The UK homebuilders especially?
    Also looking at SIG PLC.


    Strong balance sheet when cash in the bank has its advantages.

  • Can I ask why you would want to buy shares on just one solitary company  ?
  • I was just curious of people’s opinions.
    Was looking at the construction/manufacturing sectors, thought SIG crossed both paths.
    Would possibly go 40% on them with further spit of 15% on four construction businesses.
    Just a short term (3-6 months) punt using a ISA.
  • ROTW said:
    I was just curious of people’s opinions.
    Was looking at the construction/manufacturing sectors, thought SIG crossed both paths.
    Would possibly go 40% on them with further spit of 15% on four construction businesses.
    Just a short term (3-6 months) punt using a ISA.
    Putting all your eggs in one very small basket. Not something I would advise.
  • DOUCHER said:
    if you get a bonus at work is it a no brainer that you put it in your pension and avoid the tax - assuming you don't need the extra cash now obviously - or do you pay the tax eventually anyway when you start drawing your pension? a pretty basic question i guess but one i'm not 100% certain of the answer to - is it just if you draw a lump sum that you pay tax on your pension later on or???... 
    The first 25% you take from your pension is tax-free (up to the current LA  - so max around £270k). Anything after that is taxed......or should I say is taxable. If you have no other income you can then take up to your Personal Allowance (£12,500) without paying any tax. 

    Pensions can be very beneficial to those who are higher rate taxpayers during their working life but basic rate taxpayers in retirement (40% tax relief going in but only 20% tax going out). Similarly for basic rate /nil rate - although once taking the state pension there is little scope before you are being taxed.


    ok thanks - so is the forecasted monthly amount a pre tax figure? Also - i get the taxing thing with a works pension as the money going in is not taxed already but in a private pension - say a SIPS scheme with hargreaves lansdown , the money paid is post tax so i assume you wouldn't get taxed on it again later when you draw it??   
  • DOUCHER said:
    DOUCHER said:
    if you get a bonus at work is it a no brainer that you put it in your pension and avoid the tax - assuming you don't need the extra cash now obviously - or do you pay the tax eventually anyway when you start drawing your pension? a pretty basic question i guess but one i'm not 100% certain of the answer to - is it just if you draw a lump sum that you pay tax on your pension later on or???... 
    The first 25% you take from your pension is tax-free (up to the current LA  - so max around £270k). Anything after that is taxed......or should I say is taxable. If you have no other income you can then take up to your Personal Allowance (£12,500) without paying any tax. 

    Pensions can be very beneficial to those who are higher rate taxpayers during their working life but basic rate taxpayers in retirement (40% tax relief going in but only 20% tax going out). Similarly for basic rate /nil rate - although once taking the state pension there is little scope before you are being taxed.


    ok thanks - so is the forecasted monthly amount a pre tax figure? Also - i get the taxing thing with a works pension as the money going in is not taxed already but in a private pension - say a SIPS scheme with hargreaves lansdown , the money paid is post tax so i assume you wouldn't get taxed on it again later when you draw it??   
    All pension income is taxable, no matter if it's from a Final Salary scheme, a SIPP or a Stakeholder pension. 

    And I wouldn't take much notice of the forecasted monthly figure that any private pension company states on an annual statement. It's based on 2 totally meaningless assumptions.......the annual return & estimated annuity rate.
  • Blimey.  FTSE up above 6,000 today (Monday 18th...).  Pleasantly surprised - but guess it'll drop again tomorrow...
  • cafc-west said:
    Blimey.  FTSE up above 6,000 today (Monday 18th...).  Pleasantly surprised - but guess it'll drop again tomorrow...
    European markets up 4%-5% too. Good day for those of us still heavily in equities. 
  • In January the FTSE All Share peaked around 4200.
    On March 16th it had fallen to 2848, an approximate 32% fall, so I did my wife's S&S ISA.
    It fell for a further week and bottomed on March 23rd at 2727.
    I thought it may fall further (it still may).
    I waited to do this tax year's ISA's, but the market has continued to rise so I took the plunge today, May 15th with the index at 3302.

    https://www.google.com/search?q=ftse+all+share&oq=FT&aqs=chrome.0.69i59l2j69i57j69i59j0l4.2944j0j8&sourceid=chrome&ie=UTF-8
  • Not being able to physically visit clients I have had time to review some portfolios. Most clients are currently looking at losses of around 5%, the worst has been 8%. Some individual funds are higher now than they were on February. Noticeably US funds......in particular Baillie Gifford American. As I have it in my pension, along with some absolute return funds & my pension, as at today, is just 2.5% from its February high & higher than it was at the start of the year.

    Not bad considering the FTSE100 is still more than 20% off it's all time high.
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