FCA: Interest-only mortgage crackdown "gone too far"

marathonic

grizzly1911 wrote: »

I am not disputing your facts or reasonong.

Might even have a look at that S&P thingy myself.

How long have you been investing for?

is your pension via SIPP or through another method?

I'm only 30 so my personal investing career is only about a decade long. That being said, the basics don't require too much knowledge.

The research involved in trying to beat the average market returns is, obviously, pretty hefty. The research involved in trying to match market returns, with the expectation that those market returns will exceed the cost of your mortgage, is a different story. The latter revolves around ensuring you can keep costs and taxes to a minimum.

I am not investing in a SIPP at the moment because my employer offers personal pension plans with 0.3% annual charges. Contributions to the scheme are done via salary sacrifice, with them paying their own employer National Insurance savings back into the scheme - as a basic rate taxpayer, £113.80 contributions costs me £68 in net salary.

The scheme rules allow changes in contribution levels every two years. I reduced them last year as I began my house hunt - higher net salary resulting in easier mortgage approval. Now that I've purchased, I can well afford to take advantage of ISA allowances before increasing pension contributions again.

During my twenties, whilst coming up with my deposit for the house, a lot of my investing was done via individual shares and the sale of Options. I made quite a bit out of selling Naked Puts on shares that I'd consider undervalued. If the market were to deteriorate, resulting in me being required to purchase a holding in the underlying shares, I proceeded to sell Covered Calls on these until the shares would be called away. All this was done through Interactive Brokers (again, keeping costs to a minimum). But this is a topic for a whole different thread

the_flying_pig

marathonic wrote: »

Whilst it's true that some past members of the FTSE 100 are now gone, most of the ones that fell off the index simply no longer represent one of the top 100 - they are still highly functioning, profitable, businesses.

Regarding the ones that do fail, the long-term returns of the FTSE All-Share (a return that, in my opinion, will continue to beat mortgage interest rates), takes into consideration these failures.

It's not as if I'm going to say, "Jessops and Blockbuster have failed, I better stick to cash-based investments for the next 35+ years".....

well, it's true enough that there are some good records of investment returns that correct for survivorship biases & whatnot.

have you looked at the most recent credit suisse investment return yearbooks?

Thrugelmir

marathonic wrote: »

I could have posted a very mathematical post based upon 6-7% increases in dividends but why bother - you were likely to come back and disagree with that anyway....

The only thing I'm disagreeing with is your assertion that investing rather repaying debt is going to give a guaranteed return. I've held share investments for longer than you've been alive. So ridden the roller coaster for a long time. We live in extraordinary times currently. Which is no basis to forecast the future on.

Read my signature. Wisest words ever said by a trader. "This time is different". Rarely is. Far more predictable than people imagine.

marathonic

Thrugelmir wrote: »

The only thing I'm disagreeing with is your assertion that investing rather repaying debt is going to give a guaranteed return. I've held share investments for longer than you've been alive. So ridden the roller coaster for a long time. We live in extraordinary times currently. Which is no basis to forecast the future on.

Read my signature. Wisest words ever said by a trader. "This time is different". Rarely is. Far more predictable than people imagine.

I'm not saying that returns are guaranteed - just that they're very, very likely.

And I'm hoping that it isn't different this time - because that would mean that markets will continue to suffer 30-40% falls, during which I can continue to invest. And markets will, once again, reach new all time-highs - as they have always done in the past.....

Noone knows how future returns will compare against past returns but, in todays world, you are assured to have the ability to invest with trading costs or annual management charges well below what would have been the norm 10-20 years ago.

Of course, reduced charges mean nothing without the investment growth - but it's a help!!!

Thrugelmir

marathonic wrote: »

And markets will, once again, reach new all time-highs - as they have always done in the past.....

When did the FTSE hit its all time high?

marathonic

Thrugelmir wrote: »

When did the FTSE hit its all time high?

Well, obviously, we're not at that part of the cycle yet. Whilst the DOW and, more recently, the S&P 500 have hit their all time highs recently, the FTSE is still on it's way there - albeit, with the intervening pullbacks that are always to be expected.

The FTSE 100, FTSE 250 and FTSE All-Share, whilst not at all time highs, are now at levels where you could select almost any past time-period and know that a regular drip feeding of investments over that time would have seen you with pretty good returns - especially when dividends are accounted for.

Thrugelmir

marathonic wrote: »

Well, obviously, we're not at that part of the cycle yet.

When's the cycle going to peak then? As FTSE 100 peaked in 1999. Some 14 years ago.

As of today still 9.5% beneath it.

CLAPTON

Thrugelmir wrote: »

When's the cycle going to peak then? As FTSE 100 peaked in 1999. Some 14 years ago.

As of today still 9.5% beneath it.

indeed so
inflation adjusted; nowhere near the peak

marathonic

Thrugelmir wrote: »

When's the cycle going to peak then? As FTSE 100 peaked in 1999. Some 14 years ago.

As of today still 9.5% beneath it.

Are you really expecting me to answer that?

Of what relevance is the fact that the FTSE is still 9.5% beneath the peak unless you invested your entire proceeds at that point and have invested nothing since?

Pull up a chart of the FTSE 100 and try to pick the worst possible time that you could have started a regular monthly investment and you'll realise that it's the troughs that provide most of the returns in regular investing - regarding peaks, you only need one (into which you can sell).

This is assuming you aren't forced to sell of course.

Thrugelmir

CLAPTON wrote: »

indeed so
inflation adjusted; nowhere near the peak

All those investors who bought Lastminute.com...........:eek: