private pensions whats the point??

peterbaker

zygurat789 wrote: »

You only have to save £100 per month, indexed at a constant 4% pa and assuming a growth rate of 5% for less than 24 years to achieve a fund of £80,000 (tax relief makes it up to £100,000 which is why the pension is taxed).

And if the growth rate on some 'cautious' fund you might be in is -20% a couple of years in every ten then what?

I'll tell you smarta$$, you get back 25% less than you put in (before tax relief of course, but who cares about tax relief when investments are designed to go backwards into the bonuses of spivs) :mad:

peter1000

the word !!!! you find abusive,poor mr purch.........

zygurat789

peterbaker wrote: »

And if the growth rate on some 'cautious' fund you might be in is -20% a couple of years in every ten then what?

I'll tell you smarta$$, you get back 25% less than you put in (before tax relief of course, but who cares about tax relief when investments are designed to go backwards into the bonuses of spivs) :mad:

So you've got two usernames peter

dunstonh

And if the growth rate on some 'cautious' fund you might be in is -20% every couple of years in every ten then what?

There has only been one drop in excess of 20% in the last 20 years for that sector and that was during the recession and the sector is already higher than it was pre-recession. The dot.com/US issues at the early part of the millennium saw the other major drop and that fell 17.5% from top to bottom. Although 18 months later it was higher again.

20 years of 50pm @ 5% net interest in a savings account would see that savings account at £20,471 now. 20 years 0f 50pm net into a pension invested in a sector average cautious managed fund would see that fund at £29,084.

So how do you explain it being higher if its designed to go backwards?

peterbaker

zygurat789 wrote: »

So you've got two usernames peter

Wrong again.

peterbaker

dunstonh wrote: »

There has only been one drop in excess of 20% in the last 20 years.

Tell 12,000 Barclays cautious investors that.

Your business dunstonh is not about averages, it is about the wonders of compounding and who describes them the way they do, and why.

zygurat789

peterbaker wrote: »

Wrong again.

I don't think so

Aegis

casey_junior wrote: »

In 20 to 30 years, you will be saying that the pensions that you're selling then have no comparison to the crap that was sold in the noughties! Same old bull.

Not really. Right now you can get access to the same investment funds inside and outside a pension wrapper. Pensions are therefore a very simple proposition now in terms of managing the ongoing investments, with policyholders (either alone or via an IFA) able to pick and choose pretty much whatever they want to put their money into. It's therefore quite hard to imagine a situation where 20 years from now we could look back and say something like "those pensions just weren't flexible enough" or "people weren't able to see what they were actually investing into".

In reality the only issue I see at the moment is the general desire for people to go into a SIPP rather than a lower cost alternative, but I've only seen those actually recommended for more complex cases, with the majority being set up on an execution-only basis.

Previously a lot of the investments were essentially into behind the scenes "with profits" funds with little transparency. Much less common now.

peterbaker

zygurat789 wrote: »

I don't think so

Think what you like - you are way wide of the mark.