Pensions - My viewpoint after 30 years of contributions!

jamesd

Gorgeous_George wrote: »

Pensions were great when rates of return were 10% plus.

My older work pension is probably up by more than that annualised even after the recent drops. And that's mainly using just trackers, not anything fancy. Similar for the S&S ISA, though not using trackers. That's with the pension starting around 2008, covering all of the recent troubles in the markets. Those have been profitable for those who started recently, not a bad thing at all.

Gorgeous_George wrote: »

Unlike the customer, the salesman's profit is guaranteed.

Have you decided to stop using Zopa? Zopa takes its borrower fee using lenders' money so Zopa gets paid even if the borrower defaults before making a payment, with the lenders effectively picking up Zopa's bill. Whatever the borrower does, Zopa still gets paid most of the money it earns on the loan. Zopa also keeps on making its lender fee even if the lenders end up losing money overall on their investments. It works very much like a full commission unit trust company, except in just three years Zopa gets over 40% of the total amount paid by the borrower that goes to either Zopa or lenders, after bad debt allowance, on median loan size in the A36 market.

Similar deal in property. The estate agents and solicitors still get paid even if you lose money on the deal. Hopefully not 40%+ of the money being made, though.

bigfreddiel

Velcro_Hotdog wrote: »

Fantastic agrument their mate, give yourself a pat on the back.

not to mention his spelling!:rotfl:

atush

Gorgeous_George wrote: »

I'm with the OP on this one.

Pensions were great when rates of return were 10% plus. In today's low rate economy the saleman is likely to make far more than the customer. Unlike the customer, the salesman's profit is guaranteed.

I prefer to buy houses.

GG

GG have fun with your houses. When the prices fallen even further? Void periods? Damage? Interest rates climb to heady heights?

Actually, in today's economy the salesman probablhy makes les than in the old 10% days. Competition, regulation, stake holder whatever.

I invest in investment trusts among other things. They have far less in the way of charges than anything you have suggested. Hove you actually tablutaled all your ocsts with ain investment property form buying, selling, mtg costs, letting fees, voids, damagre, rates- whatever. And can even invest in JUST property if you remain an all my eggs in one basket kind of guy.


Property is a great investment in many cases (esp if you live there), and a bad investment in some. What it should never be is your only investment. Cash, equities, and other classes should always be part of a balanced portfolio.

casey_junior

xlnt wrote: »

Unless you're in a super job or work in the public sector I would think its pretty dam useless to start a private pension when you're young.

I used to post here with the same sentiments as yourself. My first job lasted half a lifetime and paying into a FS scheme as well as SERPS. I dreamed even then of retiring on more than I got working.:o
Place closed, but even greater riches were dangled by the provided Financial Adviser in the form of a with profits buyout plan.:j
Anyway, the next third of my life was in a contracted out scheme which on closure fell into the lap of the FAS ::mad:
The next seven or eight years was spent in Minimum Wage, which I had to leave through ill health which gave me time to mope about the cr*p hand I was dealt.
But Hark, Christmas is coming and with it £250 a week into my hand
which is some lift from £92 ESA. :j
Roll on Christmas, my pension and my lump sum! :beer:

Loughton_Monkey

xlnt wrote: »

Unless you're in a super job or work in the public sector I would think its pretty dam useless to start a private pension when you're young. I did 30 years ago with Equitable Life and have been shafted good and proper, I should have had expensive holidays and new cars than pay in what I did for a very small pension return now. Let the government sort it out when you're old and Gray, no point making the greedy insurance companies mega rich! :mad:

You are perfectly entitled to your own opinion.

Most of the time, however, differing opinions as between two people have no financial effect. Differences about paying into a pension (or not) however have very different financial consequences.

As those of us who are already retired will know, opinions cease to be of any value any more. Our financial position, at this stage, is "fact". In other words, those of us who did pay a lot into pensions generally 'know' that it was extremely worthwhile, and some of us do buy new cars and have very expensive holidays.

Insurance Companies may well have made a few shillings out of me, and at the same time, I have made rather a few shillings from tax relief.

I would make just one suggestion. You should print out your post in large bold letters, add the date, and put it into a frame. When you retire, put it on your mantlepiece and it will help to explain to your family, and all other visitors, why you live as you do.

gadgetmind

Loughton_Monkey wrote: »

Insurance Companies may well have made a few shillings out of me, and at the same time, I have made rather a few shillings from tax relief.

Quite so. I do put a lot of work into minimising the drag on my pensions etc. caused by fund/trust managers, platform providers, and IFAs, but I also work hard on optimising my tax relief (you won't believe how complex my spreadsheets are!) and ensuring my investments benefit from good asset allocation.

You should print out your post in large bold letters, add the date, and put it into a frame. When you retire, put it on your mantlepiece and it will help to explain to your family, and all other visitors, why you live as you do.

I like that. A message from current self to future self explaining exactly why their retirement years will be spent in poverty and deprivation.

"Sorry, I couldn't afford another 5% off the top line and into my pension, not with the holidays and Sky subscription, so enjoy your relentless diet of tinned tomatoes on toast."

cyclonebri1

dunstonh wrote: »

Personal pensions didnt exist until 1988. That is 23 years ago. So, you must have had a different product. Probably a retirement annuity contract. You could not top those up after 1988. They were also paid gross and had to have the tax relief reclaimed via tax code.

You sure about that?? Mine started/was mis sold to me in 1983 or 4, I can't fully recall without checking the mountain of paperwork I still hold.
That continued through to about 1995 without change to the policy and with constant increased contributions. I was even able to get L&G to compensate back to that start date rather than 1988 when the regulation came in.;)

mania112

cyclonebri1 wrote: »

You sure about that?? Mine started/was mis sold to me in 1983 or 4, I can't fully recall without checking the mountain of paperwork I still hold.
That continued through to about 1995 without change to the policy and with constant increased contributions. I was even able to get L&G to compensate back to that start date rather than 1988 when the regulation came in.;)

True PPP's (personal pension plans) were introduced in 1988, but they essentially replaced Retirement Annuity Plans, so maybe that's what you had Pre 88?

atush

I would make just one suggestion. You should print out your post in large bold letters, add the date, and put it into a frame. When you retire, put it on your mantlepiece and it will help to explain to your family, and all other visitors, why you live as you do.

excellent idea LM. Should be a sticky ;-)