Income Investor - Just Starting Out

jonnyb

I have been doing what the op is now doing, for the last 18 months. Investing 100 per month foe my 2 young boys in a selftrade s&s isa. So far bought into vodafone, aviva, united utilities, with all dividends auto reinvested, and even a bit of barclays for growth. Obviously needs to diversify a bit as i go, but feel positive about it.

koru

mbbetter wrote: »

Hi Koru, regarding the mortgage...

The challenge (nice challenge really) is that if I keep punching the mortgage in the face at the maximum rate (assuming we don't upsize) is that once its paid (3.5yrs) the tax man will then punch me in the face to the tune of 40% tax (income) for our surplus cash.

So rather than paying off my mortgage in 3.5 years why not pay it in 7 and pay less tax? That's the plan I'm formulating at least.

Sounds like a sensible reason. Your ISA allowance gives tax savings the rest of your life, so it is probably worth giving priority to grabbing those ISA allowances each year.

berteddie

Liking the thread! Will be keeping an eye on it for any tips on either how to achieve a decent income portfolio or even stock tips.

This is pretty much exactly my situation. Other than I'm in a fortunate position in that I dont pay any charges other than Stamp Duty when buying, so I buy £50 a week and then £200 at the end of the month.

Like has been mentioned in the thread before, my plan is to do everything I can to enable me to at least semi-retire at 55.

For what its worth I'm currently taking a bit of a punt with RSA. I appreciate such a high yeild is a warning from the market, but it looks a sound long term bet in my eyes. Not that I think I'm cleverer than the market of course!

I have to keep stoping myself from buying Lloyds or RBS in an even bigger punt on the hope of decent dividends in 5-7 years at bargain prices today... Bit to much of a gamble for me at the mo tho! Whats everyone elses thought on them?

gadgetmind

berteddie wrote: »

I have to keep stoping myself from buying Lloyds or RBS in an even bigger punt

If you're an income investor, I hope you've looked at Lloyds, RBS and Natwest prefs. Banking/finance capital in general is a good play right now unless it all turns to 5h1t.

If the ords are worth a punt, the prefs are an even better bet income wise. LLPC seem to me to be the best regards risk/reward but it's a complex call. My daughter just used funds from her 2012/13 CGT allowance to buy LLPC to provide university income. Fingers crossed!

YoungBusinessman

I am well and truely in! Will be following every thread like this every step of the way. I am heading for debt free at the end of this year, buy a house next year, beyond that i will be looking to spread my surplus income. I will be 21 soon so i have about 24 years to "semi retire". My only target is that income investing brings a good chunk of my salary by then. I will still reinvest it and try not to take anything out as early as 45.

Plan would be to reinvest income from this and keep building it up. With me semi retiring and my salary dropping down a bit, it would just see me have less of a surplus. If that makes sense. I will be setting myself up as a ltd company before long and i will leave money in the business year on year(trying to forget about inflation loss as i do this) So when i cut back my work at 45, there is capital in the business to keep me on the full salary to age 50. So my hours drop age 45, my income, however doesnt drop until 50. This would then mean(as it stands), i have 5 years from 50 to either work part time to cover living costs or live off savings until private pensions kick in(if i have).

What does everyone think? Am i living in dreamland?