What to do with pension lump sum

dunstonh

Yes, although last time I took IFA advice, I was recommended to buy funds which subsequently lost 90% of their value and have never really recovered.

The only funds that lost 90% and never recovered (although there was a upward trend a few years back) were tech stocks. If you had invested 100% into tech stocks then that is grounds for complaint as that level of risk would be classed as suicidal.

Orwell

Tech Stocks (or rather funds) that was it. My IFA friend was convinced that they were the only game in town.

As for structured products - I will admit to not knowing what they are - but anything that is complicated or front-loads returns sounds like bad news to me. I will only buy products that I understand, with transparent and low charges.

I am 50 next month in fact, but I can't get a purchased annuity quote from Blackstone Moregate because I am under 50. How ridiculous is that - how can I plan ahead (only one month)?

dunstonh

Tech Stocks (or rather funds) that was it. My IFA friend was convinced that they were the only game in town.

They were good for a dabble with a small amount or if they formed part of your specialist sector allocation in your portfolio. They were never suitable for single fund investing. If that was the case then it was bad advice as you clearly dont have the risk profile to handle a 10 out of 10 risk rating. That "advice" has soured you somewhat and has tainted your view of options that would be potentially suitable and you would almost certainly consider had that not happened. Its not too late to make a complaint if it was incorrect for you.

However, if it was just a dabble or punt and you knew that then you dont have grounds for complaint because that is what goes with that sort of investing. In which case, you shouldnt consider it investing but more a gamble. A typical risk scale of 1 to 10 and going in at 10 is not reflective of the average person who will more often than not come out around 4 or 5. You shouldnt measure the quality of products/funds designed for risks 4 and 5 on the basis of a risk 10 product/fund.

As for structured products - I will admit to not knowing what they are - but anything that is complicated or front-loads returns sounds like bad news to me. I will only buy products that I understand, with transparent and low charges.

They are not complicated to understand. Personally, I am not a fan of them as the terms are often not very good and the costs of the guarantees erode too much of the potential. However, if you want simplicity and a greater structure and certainty then they can be ideal. There are 5 year versions paying just over 7% a year (monthly income) and will return your capital in 5 years time providing the FTSE hasnt dropped below 50% on its current level. The last bit is the main risk area and you have to make a judgement call on whether you believe that is likely or not. However, for some of the money, and considering that the FTSE is well down on recent years they could be useful for some of the money.

I am 50 next month in fact, but I can't get a purchased annuity quote from Blackstone Moregate because I am under 50. How ridiculous is that - how can I plan ahead (only one month)?

It is possible to get an example quote. Whoever is telling you that you cant is incorrect. The terms wont be guaranteed because you are too far away to get a guaranteed quote but you can get an example quote an the assumption that you were aged 50 now.