FTSE 100 new 52 week high

chucknorris

RenovationMan wrote: »

Does...Not...Compute...!

Well I have reached a point in my life where I know I have enough to live very comfortably (from a financial point of view) and as such my focus now is to make sure that I enjoy my life as much as possible rather than trying to make even more money, which to be honest I don't particularly need so I would be working for the tax man.

sabretoothtigger

I am simply looking for the best return to protect my current worth from future inflation.

so you buy a fixed rate bond for 19 years, does not compute

you get your 10,000 back in 19 years and you go down the shops and a loaf of bread costs 500. Your bond lost no money, do you feel safe

At least if you retire at 65 and your hand is forced to buying bonds, then you may not live long enough to realise any negatives of such a strategy after all you cant take it with you. But if you dont need to buy bonds, I believe right now is a fairly poor time to be taking a long term view

Lowest banking interest rate for three hundred years but now is the time to lock in a fixed rate of interest for the next two decades? What was the price of this tesco bond when rates were 5%, Im guessing these things were cheaper and/or gave better returns




This fund yields over 10%, paid monthly. I expect these high yield higher risk funds to do better then expected as money becomes cheaper, their normally high return becomes easier to pay hence outperformance
http://www.google.co.uk/finance?q=iid

chucknorris

sabretoothtigger wrote: »

so you buy a fixed rate bond for 19 years, does not compute

you get your 10,000 back in 19 years and you go down the shops and a loaf of bread costs 500. Your bond lost no money, do you feel safe

I understand about future values of money and I also understand that 5% tax free might not be a great inflation hedge (but I think it's adequate and 19 years was an extreme example). But I (we in reality as it would be my wife too). It is a small portion of my overall pot. This is only dealing with my stocks and shares isa's not my main wealth.

I have no interest at all in buying into funds. I think we are at different places. I'm not faulting your strategy, it's just that it's not for me, that's all.

I imagine a lof of bread would about this much in 19 years:

at 3% 1.03^19 x £1.25 = £2.19
at 4% 1.04^19 x £1.25 = £2.63
at 5% 1.05^19 x £1.25 = £3.16

It would take an annual inflation rate of over 37% to raise bread to around £500 in 19 years, so I feel safe that that scenario will not be happening:

1.37^19 x £1.25 = £494.99

Generali

Blacklight wrote: »

Just an observation, 5891 at close of play today.

6000+ by the end of the year?

A bit of 'window dressing' going on perhaps?

RenovationMan

chucknorris wrote: »

I think we are at different places. I'm not faulting your strategy, it's just that it's not for me, that's all.

Totally agree and this is what I was saying in my original post. I do think it's sensible to protect some of the gains you have made so far, but personally I wouldn't do this at the risk of losing further gains over the 19 years (I assume until you retire). No one knows how much money you will need in the future.

The question I always ask myself is "Am I really at the point with my net worth (savings, property equity & pension) that if I could not work from tomorrow onwards due to accident or illness I would have enough to live comfortably without relying on the state?"

So far I always answer "NO!", hence my 'enough, is never enough' stance. If you are in the position, 19 years before retirement, that you can ask yourself the same questions and answer "YES!", then thats brilliant, and no wonder you now want to protect all that!

chucknorris

RenovationMan wrote: »

Totally agree and this is what I was saying in my original post. I do think it's sensible to protect some of the gains you have made so far, but personally I wouldn't do this at the risk of losing further gains over the 19 years (I assume until you retire). No one knows how much money you will need in the future.

The question I always ask myself is "Am I really at the point with my net worth (savings, property equity & pension) that if I could not work from tomorrow onwards due to accident or illness I would have enough to live comfortably without relying on the state?"

So far I always answer "NO!", hence my 'enough, is never enough' stance. If you are in the position, 19 years before retirement, that you can ask yourself the same questions and answer "YES!", then thats brilliant, and no wonder you now want to protect all that!

I retired early quite a few years ago but recently started working as a university lecturer, which was something I always wanted to do. But when I was working (chartered surveyor) the pay cut was a bit too much to take, why I didn't just go straight into lecturing instead of retiring is hard to explain (I think I burnt out working hard in my career and running two businesses on top in my spare time).

Anyway the position that I am in now is that I could live comfortably on what I have without my salary, and as I will probably work for another 12 years (as long as I enjoy doing it) until I'm 65 means that I am certainly ok. Which is why I probably appear to be taking a arther defensive position to you, but that's all I need to do.

RenovationMan

What a great position to be in. Brilliant.