Art as an alternative to saving for a pension

blossom30

Hi I was watching the news this morning about the latest drop in the shares market and the problems it caused with pensions. One viewer wrote in and said they stopped investing into a private pension 6 years ago and now collect medals. The guy from money box didnt seem too impressed with this and got me thinking. My brother has an art gallery and I was thinking of buying art instead of relying on the stock markets. Some people invest in other things like fine wines. I was wondering what other MSE'rs thought about this and other ways of investing in your future. Any opinions appreciated. shrewdalx

CannySaver_2

Hi

A few thoughts:

1. Buying any single asset class and relying on the price being high just when you need the money is a recipie for disaster, the term "all your eggs in one basket" springs to mind

2. Point 1 equally applies to someone who holds all equities, all cash, all bonds etc, you get the picture

3. A portfolio of diversified, non correlated asset classes, would be a more sensible choice, which of course could include some more left field investments such as art, wine etc

4. Although I would suggest that if we are heading into (or already enough) some very tought economic times things such as art and wine are a discretionary purchase, not seen as a particularly safe haven, and likely to be adversly affected by a continued economic downturn, after all you dont have to buy that picture or that fine bottle of claret

Just my thoughts, be interested to hear others.

The Canny Saver

Norma_Desmond

Not to sound defeatist but the art world is a minefield; I've spent years buying and selling paintings / sculpture because it's my passion and even though it's the one thing I would claim to have real knowledge of, I've been 'stung' a couple of times.

I had a good year some time back and earned a lot of money from a couple of speculative paintings, but I certainly wouldn't rely on a few hundred pounds here and there and months / years apart to supplement or replace a pension.

You *have* to know what you're doing and spend a lot of time and effort in research alone.

Unless you can honestly say that you have an infallible 'eye' then I wouldn't risk it.

Wine I know nothing about - apart from enjoying it!

Good luck anyway; what sort of gallery does your brother have? Modern art?

SailorSam

Art goes in-and-of-fashion, so you'd have to know your subject very well. Then if you came to sell in the future auctioneer fees can be expensive.

Slightly off topic but they were talking to someone on our local radio last week who had been called in for an interview with the taxman. She was asked 'do you have any paintings'. She answered yes but didn't quite understand why they wanted to know.
The taxman asked who did them ........... the woman said, her grandchildren.

Sapphire

Antiques are better, I think – but here again you have to know your subject areas and therefore what you are doing.

Art – particularly contemporary art – is a minefield. Many so-called artworks that were churned out during the boom and sold for huge amounts of money will not stand the test of time, IMHO.

dunstonh

was watching the news this morning about the latest drop in the shares market and the problems it caused with pensions.

First of all, it hasnt caused any problems with pensions. Markets zig zag. Always have, always will. Despite the recent drop, most people are still up over 12 months at a rate higher than savings. Typically what goes up comes down, what goes down comes up. Monthly payments work best when it's volatile. The only time volatility is as issue is if you are coming up to retirement and you have foolishly left yourself in the markets rather than gradually move over to less volatile investments.

The media focuses on the down but rarely reports on the up. For example, despite the drop the other day, it is the third time in the last month that the FTSE has been around this level. There have been 5 major drops in the last month, the four proceeding ones all had periods of growth that followed.

Trying to invest in non-income generating assets on the hope of price speculation is risky. You need to know what you are doing and you need to get lucky.

blossom30

Norma_Desmond wrote: »

Not to sound defeatist but the art world is a minefield; I've spent years buying and selling paintings / sculpture because it's my passion and even though it's the one thing I would claim to have real knowledge of, I've been 'stung' a couple of times.

I had a good year some time back and earned a lot of money from a couple of speculative paintings, but I certainly wouldn't rely on a few hundred pounds here and there and months / years apart to supplement or replace a pension.

You *have* to know what you're doing and spend a lot of time and effort in research alone.

Unless you can honestly say that you have an infallible 'eye' then I wouldn't risk it.

Wine I know nothing about - apart from enjoying it!

Good luck anyway; what sort of gallery does your brother have? Modern art?

Hi Norma He displays paintings from local well known artists and sells them on for a commission. Thanks for your comments.shrewdal