Savings and Investments thread

PragueAddick · February 2021

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

Well I'll offer you these thoughts, but bear in mind not just that I'm a mug punter, but more seriously that to some extent I've always had a tendency to invest in stuff I believe in, and that isn't always the smartest move in terms of maximising gains at least. With that in mind what has really done well for me in the last year is the "ethical/sustainable" sector. Specifically :

Janus Henderson Global Sustainable Equity
Rathbone Global Sustainability
Baillie Gifford Positive Change
Rathbone Ethical Bond
EdenTree Amity International

I'm happy with all of these and might even buy more, because I think broadly (and I only dare to think very broadly when investing) there is a genuine shift in thinking on the issues in most countries; Covid is clearly making people re-assess what is important in their lives (opinion polls already reflect this) and of course Trump has gone, and Biden is swiftly trying to fix the damage he caused.

But to repeat, just my opinion, and my style of investing.

Rob7Lee · February 2021

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Alwaysneil · February 2021

Wonder if we will finally see a flat rate pension tax relief in the upcoming budget....

Rob7Lee · February 2021

Alwaysneil said:

Wonder if we will finally see a flat rate pension tax relief in the upcoming budget....

It’s definitely coming, whether it’s next week I’m not sure.

SomervilleAddick · February 2021

Arsenetatters said:

Rob7Lee said:

stevexreeve said:

Don't forget MIRAS . Maybe not such a bad idea?

MIRAS was scrapped 21 years ago now, by the end it was worth a maximum of £208 a year when abolished. MIRAS was actually on all loans not just mortgages but was restricted to mortgages in the mid 70’s.

Arsenetatters said:

Daarrzzetbum said:

ThreadKiller said:

I keep seeing 15% mortgate badge of honour, I fancy that no one on this thread has ever paid 15% in the UK.

Oh yes back in the 80s I did, well think a I did.

I bought a place in 1989/90 and the rate was 15%. It crippled me to start with and all I could afford was a studio flat in Teddington for £55,000. Sold it for £35,000 around 1996. It's probably worth a million now!!

People forget how many were effected by negative equity. There was a point when I came into work each morning there was a queue at the Branch of people wanting to hand in their keys. Many thought that was it only to be told they were still liable for the loan, more than once the police were called.....

There was an awful bloke and his Mrs that lived above me. They had bought their's at the peak of the prices - £60K plus. Looking back he may have just been an arse as he was so stressed. He attempted to just leave and send the keys back. It was quite a major debt TBH.

I knew someone who that emptied their place out, put the keys in the building societies mail slot and was on a plane to South Africa next morning. I don’t know if he ever moved back from SA, but he was so deep I negative equity he just did a runner.

SomervilleAddick · February 2021

PragueAddick said:

@Rob7Lee couple of points to your last reply to me.

I'm aware of the figures for German rental, I agree with you that the structure seems much better for both tenants and landlords. The bit that you don't acknowledge is the attitudinal element I referred to. It was brought home to me, admittedly a long time ago, when my buddy and I were invited to stay over at the home of a young German lady who had been a flatmate for a year while she was on an intern in London. She lived near Dusseldorf with her parents. Her dad was the CEO of Nikon Germany. They had an apartment ,not a house, but it was a big swanky 4 bedroom affair, as you'd expect for such a successful corporate exec. We were gobsmacked to learn that it was rented, and a long conversation ensued over several beers, but basically he explained that Germans want to use their earnings to live a good life rather than tie it all up in mortgages. Now you could still debate the economic wisdom, but if somebody like him thought that way, (and I've had it confirmed many times since), then it is a very different attitude among the most economically literate members of German society.

I take your point about population pressure on London prices, but there is a wider pressure on the whole South East, too, right? (Evan Davies made a brilliant TV series on how the UK economy was skewing to the SE maybe 10 years ago and nobody took any notice). So even if people move out as you recommend, to spend their most vibrant years in some dormitory suburb or worse, they are still faced with prices much higher than is economically healthy. Lack of supply, as @Rothko said, and lack of economic investment in the regions.

"What’s become more common is a group of friends renting a house together"...mate that's exactly what I moved into, 3 of the 4 others were from Aberdeen. They "interviewed" me. We still laugh about it today. It was 1977....

House sharing is still a big thing around here. Loads of 2/3 bedroom places have unrelated people living in them. And yes, they do interview prospective new tenants. I watch people turning up every 30 minutes at the house opposite us a while back. I wondered if they had turned it into a drug den, but they were just looking for a house sharer.

CafcWest · February 2021

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

golfaddick · February 2021

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Rob7Lee · February 2021

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

Look at what the funds are invested in, what do you have in UK, bonds, America, Asia etc. Then take a view.

If you don't need the cash then makes sense not to draw down yet if you are already paying 40% tax, that said if you aren't filling up an ISA each year taking 25% now might be worth considering and putting it into an ISA (in the same funds if you wish), but it does depend on other things such as IHT planning etc.

Bangkokaddick · February 2021

PragueAddick said:

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

Well I'll offer you these thoughts, but bear in mind not just that I'm a mug punter, but more seriously that to some extent I've always had a tendency to invest in stuff I believe in, and that isn't always the smartest move in terms of maximising gains at least. With that in mind what has really done well for me in the last year is the "ethical/sustainable" sector. Specifically :

Janus Henderson Global Sustainable Equity
Rathbone Global Sustainability
Baillie Gifford Positive Change
Rathbone Ethical Bond
EdenTree Amity International

I'm happy with all of these and might even buy more, because I think broadly (and I only dare to think very broadly when investing) there is a genuine shift in thinking on the issues in most countries; Covid is clearly making people re-assess what is important in their lives (opinion polls already reflect this) and of course Trump has gone, and Biden is swiftly trying to fix the damage he caused.

But to repeat, just my opinion, and my style of investing.

I'm with you, though I'm invested in ETFs rather than funds in these classes. The class has had a couple of real plummets recently but it's the future and I keep toying with increasing my exposure.

Paradoxically, it's oil shares that have had a boom recently but I've stayed away from the regular energy business and don't intend to change my view.

On a totally different subject, I note that Zynex fell 14% yesterday! I sold most of my holding during the last upturn, though kept a little, only because of the owner!

LTKapal · February 2021

I see that Zynex dropped 4+ cents, how did their Q4 go?

golfaddick · February 2021

LTKapal said:

I see that Zynex dropped 4+ cents, how did their Q4 go?

Someone on another thread linked their year end report saying it was their best year ever - record profits.

CafcWest · February 2021

golfaddick said:

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Thanks @golfaddick and @Rob7Lee for the advice. When I said in drawdown - I meant that I've already taken the 25% tax free as a lump sum (now in various bonds, equities, premium bonds and Marcus). My ISA allowance for 2021 is maxed out. The £195k is what was left and I haven't drawn down anything as I'd have to pay 40% tax on it and I'm lucky enough to have 3 other pensions (2 final salary) paying me - plus I'm still working 2 days a week. Most of the £195 is invested in various funds with £1.8k sitting there in cash. I think I'll look at asian stocks as most of the funds I have are US, UK and European. I was hoping one of you could maybe suggest a fund that looked promising - my normal risk profile is medium.

WishIdStayedinthePub · February 2021

golfaddick said:

LTKapal said:

I see that Zynex dropped 4+ cents, how did their Q4 go?

Someone on another thread linked their year end report saying it was their best year ever - record profits.

Record revenue, record profits, record orders this quarter. But still (slightly) missed expectations.

People have been worrying about cash flow, inventory build-ups and soaring working capital. Tom (as his CFO calls him) says this is all going to sort itself out as they move out of Covid restrictions, that there is a seasonality impact (something to do with the way insurance excesses impact cash flow at this time of year) and the investments in salespeople flow through to order and then revenue. You just have to trust he's not hiding problems (discounting seems high).

It's interesting to read his transcript - he definitely takes the long view and invests in his business, which augurs well for Charlton.

I buy it but the market didn't and the shares dropped 20% yesterday.

IdleHans · February 2021

WishIdStayedinthePub said:

golfaddick said:

LTKapal said:

I see that Zynex dropped 4+ cents, how did their Q4 go?

Someone on another thread linked their year end report saying it was their best year ever - record profits.

Record revenue, record profits, record orders this quarter. But still (slightly) missed expectations.

People have been worrying about cash flow, inventory build-ups and soaring working capital. Tom (as his CFO calls him) says this is all going to sort itself out as they move out of Covid restrictions, that there is a seasonality impact (something to do with the way insurance excesses impact cash flow at this time of year) and the investments in salespeople flow through to order and then revenue. You just have to trust he's not hiding problems (discounting seems high).

It's interesting to read his transcript - he definitely takes the long view and invests in his business, which augurs well for Charlton.

I buy it but the market didn't and the shares dropped 20% yesterday.

Buying opportunity

WishIdStayedinthePub · February 2021

PragueAddick said:

Rob7Lee said:

PragueAddick said:

mendonca said:

It's been a sea of red all week.

Am glad took some profits a few weeks back, but as per, wish took more now.

I've been reading a fair bit in the FT,Citywire,Economist this week. What's your take on the current global stock markets? Is this the long awaited correction or something a bit more worrysome?

Mate, once again. It isn't even a correction yet. FTSE100 - an underperformer, is currently at 6617. It closed on 31 Dec at 6460.

Good for you and @Rob7Lee if you "took profits". My question to you both is, assuming you don't need the cash for non-investment reasons, what you gonna' do with these profits?

TBH, i'd love to say mine was as I'm so good at reading the markets, but in all honesty because some of my funds had done so well it became a bit unbalanced with too much in the US, so it was to re-balance, I took the profit (in fact on most I kept the profit invested and took back my original investment). This is predominantly in my SIPP. The latest amounts i've bought some SAGA shares and some Royal Caribbean shares (which have done better than I expected), put a bit in Vanguard FTSE all share and some on BG Japanese, the rest just sitting in cash until I decide which i'll wait until post budget.

Right, so you were largely switching to re-balance your portfolio, rather than seeking to join the “sell-off” as the media describe it. That’s a significantly different step to someone who may have sold to, as they expect, buy back when, as they expect, markets fall further. I long ago realised that us mug punters are simply not allowed to do that, at least with funds - even if we had the ability to predict short term moves with any accuracy.

Markets are down further since my earlier posts- but still above Dec 31.

Similarly re-balanced away from tech at the beginning of the week, particularly biotech and anything on very high PEs. But kept 75% of the likes of Amazon, Microsoft, etc. with a view to top back up again. It helps my sanity if things keep going up, I don't entirely miss out. If I get to buy in a little lower, it doesn't matter how much lower as it's still better than if I'd held.

Where I am adding is things that I think will do well on Covid recovery and inflation, like credit, oil, pubs, construction (finally made my money back from last year on them!). Nothing speculative (except some dogs that I've had for so long, there's point in selling them), all high quality, taking a longer term view, back to basics in other words. After such a disastrous year last year, I'm playing it safer this year!

I was on an industry call yesterday with a boutique IB/asset manager who tracks consumer sentiment. There's a lot of built up savings that they think will get splurged on big ticket stuff - holidays is obvious but they are also expecting cars. Downside risks are inflation and the budget. But they were reinforcing the fact that the UK is the most it's ever been this under-valued.

The thing that isn't coming off well at all is gold - taking it up the rear end badly there because of short term dollar strength but I think I will have to be patient on that one.

golfaddick · February 2021

CafcWest said:

golfaddick said:

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Thanks @golfaddick and @Rob7Lee for the advice. When I said in drawdown - I meant that I've already taken the 25% tax free as a lump sum (now in various bonds, equities, premium bonds and Marcus). My ISA allowance for 2021 is maxed out. The £195k is what was left and I haven't drawn down anything as I'd have to pay 40% tax on it and I'm lucky enough to have 3 other pensions (2 final salary) paying me - plus I'm still working 2 days a week. Most of the £195 is invested in various funds with £1.8k sitting there in cash. I think I'll look at asian stocks as most of the funds I have are US, UK and European. I was hoping one of you could maybe suggest a fund that looked promising - my normal risk profile is medium.

Tbh £1800 out of a fund of £195,000 is chicken feed.......less than 1%. You might just as well leave it in cash as to investing it into bitcoin. Not trying to be funny but on it's own it's just not worth worrying about. Just leave it until you want to rebalance your portfolio & then use it towards that.

PragueAddick · February 2021

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

Hi mate, when I noticed that, I thought I should recommend you to download and read BestInvest's Spot the Dog...

Rob7Lee · February 2021

CafcWest said:

golfaddick said:

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Thanks @golfaddick and @Rob7Lee for the advice. When I said in drawdown - I meant that I've already taken the 25% tax free as a lump sum (now in various bonds, equities, premium bonds and Marcus). My ISA allowance for 2021 is maxed out. The £195k is what was left and I haven't drawn down anything as I'd have to pay 40% tax on it and I'm lucky enough to have 3 other pensions (2 final salary) paying me - plus I'm still working 2 days a week. Most of the £195 is invested in various funds with £1.8k sitting there in cash. I think I'll look at asian stocks as most of the funds I have are US, UK and European. I was hoping one of you could maybe suggest a fund that looked promising - my normal risk profile is medium.

As Golfie says, £1800 in the overall scheme of your pot is immaterial, in fact if you are charged trading fee's it's probably not worth doing anything with it until you re-balance.

golfaddick · February 2021

CafcWest said:

golfaddick said:

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Thanks @golfaddick and @Rob7Lee for the advice. When I said in drawdown - I meant that I've already taken the 25% tax free as a lump sum (now in various bonds, equities, premium bonds and Marcus). My ISA allowance for 2021 is maxed out. The £195k is what was left and I haven't drawn down anything as I'd have to pay 40% tax on it and I'm lucky enough to have 3 other pensions (2 final salary) paying me - plus I'm still working 2 days a week. Most of the £195 is invested in various funds with £1.8k sitting there in cash. I think I'll look at asian stocks as most of the funds I have are US, UK and European. I was hoping one of you could maybe suggest a fund that looked promising - my normal risk profile is medium.

I hope you didn't take advice when you withdrew your PCLS (commonly know as your 25% tax free allowance) because if you did I'd complain to the Ombusman. Why would you withdraw all of the allowance (thus crystalising your whole pot) and then put tax-free monies into less tax efficient places.

I have no problem taking monies out if you really need to (ie, to pay off mortgage or other debts) but just putting into cash deposits elsewhere really makes no sense.

CafcWest · February 2021

golfaddick said:

CafcWest said:

golfaddick said:

CafcWest said:

Rob7Lee said:n

CafcWest said:

I have a SIPP in drawdown (although I haven't yet) and there is £1800 in cash that I want to put unto a fund. Most of the other funds I have in the SIPP were (rightly or wrongly) based on suggestions on here! Any latest thoughts!!?

What else do you have and rough value? £1800 isn't a lot if your fund is £500k, but's a lot (% wise) if it's £18k. Also will depend on when you wish to start to draw down, how much and over what period.

Thanks and also to @PragueAddick - it’s both of your recommendations/thoughts I’ve followed in the past. Pot is around £195k BG various and a few HL manager funds - about 12 different funds. I’m loath to start drawdown as i already fall into higher tax bracket so 40% will ‘disappear’... @PragueAddick has suggested a few I’ll look at.

If you are smart then you can really make Drawdown work for you. First you have the 25% Tax-free amount. So, assuming you pot grows to £200k then that's £50k you can "Drawdown" tax free. If you don't need it as a lump sum then you could take it as an "income" (as regular monthly payments). The remaining £150k (plus growth ) can then be taken as income when you retire. Then you use the Personal Allowance. Assuming you retire before State Pension Age then the first £12,500pa is tax free -and the next £37,500 is taxed at 20%. Depending on your income needs you could be taking income from your pension at a minimal tax rate for a few years.

Thanks @golfaddick and @Rob7Lee for the advice. When I said in drawdown - I meant that I've already taken the 25% tax free as a lump sum (now in various bonds, equities, premium bonds and Marcus). My ISA allowance for 2021 is maxed out. The £195k is what was left and I haven't drawn down anything as I'd have to pay 40% tax on it and I'm lucky enough to have 3 other pensions (2 final salary) paying me - plus I'm still working 2 days a week. Most of the £195 is invested in various funds with £1.8k sitting there in cash. I think I'll look at asian stocks as most of the funds I have are US, UK and European. I was hoping one of you could maybe suggest a fund that looked promising - my normal risk profile is medium.

I hope you didn't take advice when you withdrew your PCLS (commonly know as your 25% tax free allowance) because if you did I'd complain to the Ombusman. Why would you withdraw all of the allowance (thus crystalising your whole pot) and then put tax-free monies into less tax efficient places.

I have no problem taking monies out if you really need to (ie, to pay off mortgage or other debts) but just putting into cash deposits elsewhere really makes no sense.

No I didn't take advice. I tend to make (rightly or wrongly) my own choices with everything! It's a risk I bizarrely like and suffer the consequences (or occasional rewards) willingly. I made the decision some years ago when I had my first bout of cancer and thought I'd take the money whilst I can! I'm still around so (with hindsight) might have done things differently despite a second cancer experience. I have a small mortgage on a low rate and I don't think worth paying off. as there is a penalty. I'll probably leave the £1800 in cash for now (based on yours and @Rob7Lee advice). Grateful for the comments and discussion.

stevexreeve · March 2021

This is a good reminder that pension savings are, almost by definition, dealt with in circumstances of illness, dementia, depression or loneliness. The rules regarding tax on pensions are simply too complex, not fit for purpose and can be inhumane. They are used by wealthy people to play a harmless game with the Inland Revenue but young people are instinctively repulsed by the whole thing and have to be nudged into saving by having to opt out of government schemes.

Not a political point or aimed at the finance industry in general. And certainly not anybody here! Just felling a bit fed up this morning!

WishIdStayedinthePub · March 2021

stevexreeve said:

This is a good reminder that pension savings are, almost by definition, dealt with in circumstances of illness, dementia, depression or loneliness. The rules regarding tax on pensions are simply too complex, not fit for purpose and can be inhumane. They are used by wealthy people to play a harmless game with the Inland Revenue but young people are instinctively repulsed by the whole thing and have to be nudged into saving by having to opt out of government schemes.

Not a political point or aimed at the finance industry in general. And certainly not anybody here! Just felling a bit fed up this morning!

Can't argue the rules are too complicated. Worse, they keep changing them, which is very counter-productive given you are making decisions on a 30 year time frame.

Ever since Gordon Brown raided pensions, every chancellor since has worked out that by the time people realise they've been robbed, it won't affect their re-election prospects - it's too remote for people to feel at the time it happens.

I've said here many times, I think the fairest way of doing things is to allow a flat overall amount of tax relief for everyone, sufficient for people to live build a pot big enough for.a (median) income. Anything above that should be a luxury and not supported by tax relief. I'd take a similar approach re energy use and how that is taxed.

WishIdStayedinthePub · March 2021

I missed all the inter-generational fun and games last week - but the real issue is cheap money. Pension income is almost impossible to build and asset prices have rocketed. It's not good for anyone (except governments and - maybe - the super wealthy) and it encourages ever more cycles of excess risk in the hunt for yield.

As Adam Smith said, there's no productive use in the capital used to rent out property but cheap money doesn't encourage bigger risks. Too many of our FTSE 100 companies look like bonds and might as well be rentals, so it's not just BTL.

Unless we get back to a sensible trade-off of risk and return, we won't build the right companies and build genuine, sustainable wealth. That's why I can't understand people's issues with Bezos. He tied his own fortune to a company, took a long-term view and continued to plow money back into the company when 'the Street' wanted him to pay dividends. We need a few Jeff Bezos over here (or more Ratcliffes, Dysons and Martins - none of them lawyers or accountants, you'll notice).

golfaddick · March 2021

stevexreeve said:

This is a good reminder that pension savings are, almost by definition, dealt with in circumstances of illness, dementia, depression or loneliness. The rules regarding tax on pensions are simply too complex, not fit for purpose and can be inhumane. They are used by wealthy people to play a harmless game with the Inland Revenue but young people are instinctively repulsed by the whole thing and have to be nudged into saving by having to opt out of government schemes.

Not a political point or aimed at the finance industry in general. And certainly not anybody here! Just felling a bit fed up this morning!

I see the person who "liked" your post is the poster you replied to & who has taken out all his tax-free money and put into potentially taxable deposits & NS&I products that are paying diddly squat.

I agree that pension rules are complex but they are certainly not "inhumane" or fit for purpose and what it tells me is that more & more people need to take professional financial advice. I understand that you might want access to money when illness or unforeseen circumstances come around, but then I could say that your critical illness policy would have paid out in the first instance so no need to touch the money put by to pay for when you retire.

Rob7Lee · March 2021

WishIdStayedinthePub said:

stevexreeve said:

This is a good reminder that pension savings are, almost by definition, dealt with in circumstances of illness, dementia, depression or loneliness. The rules regarding tax on pensions are simply too complex, not fit for purpose and can be inhumane. They are used by wealthy people to play a harmless game with the Inland Revenue but young people are instinctively repulsed by the whole thing and have to be nudged into saving by having to opt out of government schemes.

Not a political point or aimed at the finance industry in general. And certainly not anybody here! Just felling a bit fed up this morning!

Can't argue the rules are too complicated. Worse, they keep changing them, which is very counter-productive given you are making decisions on a 30 year time frame.

Ever since Gordon Brown raided pensions, every chancellor since has worked out that by the time people realise they've been robbed, it won't affect their re-election prospects - it's too remote for people to feel at the time it happens.

I've said here many times, I think the fairest way of doing things is to allow a flat overall amount of tax relief for everyone, sufficient for people to live build a pot big enough for.a (median) income. Anything above that should be a luxury and not supported by tax relief. I'd take a similar approach re energy use and how that is taxed.

I think we are coming to the time of a flat, at least flat rate, of tax relief.

The issue I've always had on things like a median income/tax relief - that might be £20k to one person and £75k to another as will depend on so many things, one example whether you live in a 2 bed terrace or a 8 bed detached and the relevant expense.

A flat rate will solve most of those issues as has limiting the LTA.

Pensions in the wider sense (planning for retirement) when used and planned correctly are vital IMHO. Giving one example, I've built a very nice pot ready for my retirement and not all in a true pension, i've been in a pension since I turned 21 some 27 years ago. My sister, for various reasons started a pension last month (she's 51!), the only other pension she has is a small school teachers one, about 4 years worth. She's suddenly released she's going to be a bit poor otherwise (and I waxed lyrical at her for many years about getting one and in particular the relevant tax benefit but she preferred to go on Safari etc).

PS - big day tomorrow. - Premium Bonds!!!!!!!

Chaz Hill · March 2021

Woman from Bristol and woman from Kent have scooped big March PB wins. Anyone’s other half suddenly packed their bags and disappeared

redman · March 2021

Be interested in some people's comments. I haven't yet used my ISA for the current tax year. I am probably overweight in equities for my age, don't want to reduce that element but don't think I should increase much. My thought is buy into a corporate bond fund. I would use the L&G as I have several ISA's already on that platform and don't want to overcomplicate.

golfaddick · March 2021

redman said:

Be interested in some people's comments. I haven't yet used my ISA for the current tax year. I am probably overweight in equities for my age, don't want to reduce that element but don't think I should increase much. My thought is buy into a corporate bond fund. I would use the L&G as I have several ISA's already on that platform and don't want to overcomplicate.

If you are looking at Bonds then look at an Absolute Return fund. The one I currently like is the Jupiter Strategic Absolute Return Bond fund.

golfaddick · March 2021

Rob7Lee said:

WishIdStayedinthePub said:

stevexreeve said:

This is a good reminder that pension savings are, almost by definition, dealt with in circumstances of illness, dementia, depression or loneliness. The rules regarding tax on pensions are simply too complex, not fit for purpose and can be inhumane. They are used by wealthy people to play a harmless game with the Inland Revenue but young people are instinctively repulsed by the whole thing and have to be nudged into saving by having to opt out of government schemes.

Not a political point or aimed at the finance industry in general. And certainly not anybody here! Just felling a bit fed up this morning!

Can't argue the rules are too complicated. Worse, they keep changing them, which is very counter-productive given you are making decisions on a 30 year time frame.

Ever since Gordon Brown raided pensions, every chancellor since has worked out that by the time people realise they've been robbed, it won't affect their re-election prospects - it's too remote for people to feel at the time it happens.

I've said here many times, I think the fairest way of doing things is to allow a flat overall amount of tax relief for everyone, sufficient for people to live build a pot big enough for.a (median) income. Anything above that should be a luxury and not supported by tax relief. I'd take a similar approach re energy use and how that is taxed.

I think we are coming to the time of a flat, at least flat rate, of tax relief.

The issue I've always had on things like a median income/tax relief - that might be £20k to one person and £75k to another as will depend on so many things, one example whether you live in a 2 bed terrace or a 8 bed detached and the relevant expense.

A flat rate will solve most of those issues as has limiting the LTA.

Pensions in the wider sense (planning for retirement) when used and planned correctly are vital IMHO. Giving one example, I've built a very nice pot ready for my retirement and not all in a true pension, i've been in a pension since I turned 21 some 27 years ago. My sister, for various reasons started a pension last month (she's 51!), the only other pension she has is a small school teachers one, about 4 years worth. She's suddenly released she's going to be a bit poor otherwise (and I waxed lyrical at her for many years about getting one and in particular the relevant tax benefit but she preferred to go on Safari etc).

PS - big day tomorrow. - Premium Bonds!!!!!!!

I think that is on the cards for the Budget on Wednesday. A flat rate of 25% for all is favourite.

Also the LTA to be frozen. Currently at £1.08m which might seem a large figure but seeing as when it was introduced in 2006 it was £1.5m and went up to £1.8m before being reduced back down with the Coalition Government - which doesn't help advisers like myself trying to gauge with clients how much they should put into their pensions as over time the goalposts are not only moved but cut in half !!

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