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Nice people thread part 4 - sugar and spice and all things
Comments
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Which would NP choose - 3k net earnings or 9k paid into a pension?
I take it that there is no prospect of the pension fund lifetime allowance being an issue, that you can afford to manage without the 3k, and that you are simply looking at the financial value? I also take it that you can invest the pension money over the long term, taking reasonably high risk, and with a management charge of at most 1% pa over the life of the pension plan? I have also assumed that tax rates will not change too much in the future.
I have assumed for comparison purposes that you would use the £3k to reduce your mortgage, and you would thus effectively earn a rate of return on it equal to your gross mortgage rate. Otherwise, it becomes an impossible non-financial value-judgement to make, eg how do you compare a family holiday now with a cruise in 20 years time?
As a starting point, you could assume that the pension fund investment return net of charges will be the same as your gross mortgage rate.
On that basis, the tax-free lump sum on the pension will be £2250, growing at the same rate as the £3k invested in paying down your mortgage.
That leaves you with £6,750 in the pension fund that has actually cost you £750 net. The £6,750 will have to be used to provide taxable pension, but even so it's clearly an excellent deal.No reliance should be placed on the above! Absolutely none, do you hear?0 -
We do seem to be headed for a GFC again, don't we. Any suggestions what to do?
Buying cheap, productive farmland would be the trade I guess if you want to make money from it.
TBH if it all goes chests up then there isn't much you can do.
It's pretty common for monetary systems to fail: the silver standard, gold standard and Bretton Woods were the last 3 failures in/pertinent to the UK and there are countless other examples across the world (e.g. the original Drachma was an iron stick: you don't hear many calls for a return to 'iron').
It'll all work out; people are pretty resilliant and imaginative when it comes down to it. If you assume that world trade reverts to barter for a bit then the UK will be fine. Ok, no new mobile phones or flat screen TVs for a bit but the UK produces plenty enough pharmaceuticals, oil and chemicals to swap for food from abroad if needs be. It probably won't come to that but as a worst case it'll be fine.
It's probably a good idea to have a bit of food in just in case. If it all blows over, which is the most likely scenario anyway, then you can just eat the food anyway.
If you're super worried, things ilke whisky, cigarettes and chocolate are good for barter.0 -
Which would NP choose - 3k net earnings or 9k paid into a pension?
£9k into pension....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0 -
What is GFC?...much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0
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neverdespairgirl wrote: »What is GFC?
It's a TLA for Global Financial Crisis.0 -
Thanks Gen....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0
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Buying cheap, productive farmland would be the trade I guess if you want to make money from it.
TBH if it all goes chests up then there isn't much you can do.
It's pretty common for monetary systems to fail: the silver standard, gold standard and Bretton Woods were the last 3 failures in/pertinent to the UK and there are countless other examples across the world (e.g. the original Drachma was an iron stick: you don't hear many calls for a return to 'iron').
It'll all work out; people are pretty resilliant and imaginative when it comes down to it. If you assume that world trade reverts to barter for a bit then the UK will be fine. Ok, no new mobile phones or flat screen TVs for a bit but the UK produces plenty enough pharmaceuticals, oil and chemicals to swap for food from abroad if needs be. It probably won't come to that but as a worst case it'll be fine.
It's probably a good idea to have a bit of food in just in case. If it all blows over, which is the most likely scenario anyway, then you can just eat the food anyway.
If you're super worried, things ilke whisky, cigarettes and chocolate are good for barter.
There is NO cheap productive farmland to be had. You are looking at £5k+ an acre these days.
If we stock up on chocolate it will all be eaten. Besides that, I am not sure that I want to be around in a post-apocalyptic Britain, trading cigarettes for antibiotics. And you in Oz will get sooooo fed up eating sheep.No reliance should be placed on the above! Absolutely none, do you hear?0 -
There is NO cheap productive farmland to be had. You are looking at £5k+ an acre these days.
If we stock up on chocolate it will all be eaten. Besides that, I am not sure that I want to be around in a post-apocalyptic Britain, trading cigarettes for antibiotics. And you in Oz will get sooooo fed up eating sheep.
There isn't any in the UK because it's an IHT avoidance. Theres plenty if you look further afield.
Anyway, it's not worth worrying about because there's bigger all you can do about it so why worry?0
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