Over 55s hoping to enjoy a 'golden retirement' are facing poverty

carolt

silvercar wrote: »

A lot of people think that these evils property investors will have got their fingers burnt on BTL and will now stand aside once the housing bubble has really burst, to allow all the FTBs to get on the housing ladder. The truth is that the canny investor is probably sitting with cash ready to buy as soon as they feel the bottom is reached. With the current mortgage shortage, it is the FTB that will find it hard to compete.

You sound ever so slightly like you tacitly approve of that.

Is that a correct supposition?

PasturesNew

My last landlord told me he'd bought four flats to rent out because he'd saved all his life for a pension only to find out it was worth pennies instead of the £25k he was expecting. In the time I rented from him, each one of those went down in value by 30%.

lilac_lady

Originally Posted by 2010
It baffles me why people are reluctant to pay off their mortgages at the earliest opportunity even when some of them are able.

A mortgage is a debt, and I cannot see any reason why over a 25 year period,and if not sooner,it should not be fully paid off.

Live now pay later,only trouble is later is now.

I agree. When you have a mortgage you're in debt.

Pobby

Misses P and I have paid into pensions since the 70`s. The last decade has been a disaster area. Stock markets up and down and poor annuities. What might have been £12 to £15k a year is now a by gone dream. However it will pay something and it can always be topped up with the state, serps and God willing, a bit of work on the side.

wymondham

Harry_Powell wrote: »

If on the other hand you put a pension away for the same timescale as you have a mortagge - typically 25 to 35 years then you'll have found (and will find again) that the stockmarket beats every other investment hands down. end of.

Ideally this is true, but I very much doubt though in this day and age many people can afford both a big mortgage and put away enough into their pension to make too much difference (unless they don't need food etc!). I know I could'nt. I only really focused heavily on the pension once the mortgage was gone - hopefully not too late at 40!

Pobby

Also what happens if interest rates return to say 5 per cent ( low in terms of the last 30 years ). What a total mess our friends who promised control over the housing market have got us into.

Thrugelmir

carolt wrote: »

..Those retiring in January 2000 could secure an annual pension of £9,000, but the figure has fallen sharply to a mere £2,500 for those retiring today, based on monthly contributions of £100 into a pension pot over 20 years.

Those starting saving in 1999 would have had to start contributions at £204 ( based in the change in the RPI from 1989) to be the equivalent to a £100 contribution in 1989.

So the change in pension pot isn't as dramatic as the unthought through piece of journalism suggests!

Also the withdrawl of dividend tax credit reclaims by pension funds has impacted pension fund returns since 1999. ( Something which will come back to haunt a certain labour politician).

carolt

An excellent point.

I had forgotten that.

matbe

PasturesNew wrote: »

My last landlord told me he'd bought four flats to rent out because he'd saved all his life for a pension only to find out it was worth pennies instead of the £25k he was expecting. In the time I rented from him, each one of those went down in value by 30%.

Did your rent fall 30% as well ?

No

Better investment than a pension then.

2010

chucknorris wrote: »

I'm in no rush when I am only paying mortgage rates of just over 1% and earning an average of over 5% on my savings

The reason you`re only paying 1% for your mortgage is because you`re being "subsidised" by savers (who are getting low interest rates),tax payers (who are saddled with toxic bank debt)and the BoE ,who are government controlled, and scared witless to imposed a true base rate.
If people bite off more than they can chew why should they expect everyone else to bail them out.

As for your 5% savings rate,you either got that by fixing for 4/5 years or you fixed it before the current turmoil started.
Seems you`ve got your cake and have eaten it and you`re all right Jack.