We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Blame the Banks or The Government?
Comments
-
What Osborne is doing doesn't begin compare to the economic vandalism Brown wreaked on the UK. Brown broke the private pension engine permanently, the savings market will recover in time. The BoE is equally complicit with Osborne regarding Funding for Lending and Help to Buy
I agree with you but there is an extension to the current low interest rates/QE and that is poor annuities that are /will be available for sometime (permanently?) for those who thought they had got safe pension pot."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Thrugelmir wrote: »Which makes one wonder if the boom years were actually just a mirage. We were never as rich as we believed we were as a nation. Certainly not saving enough for retirement years.
Yes of course they were, no real wealth is created by borrowing or printing money to pump up asset prices, but they created a feelgood factor amongst enough people to get Blair re-elected. Now Cameron & Osborne are trying to pull the same stunt with taxpayer funded interest free loans on £600k sub prime mortgages to reinflate house prices. If homeowners feel richer they will borrow, spend, and create another mirage in time for the election. The crash that comes after will be far worse, but the politicians have awarded themselves golden parachutes.“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0 -
grey_gym_sock wrote: »yeah, but what about the emotional damage?
Are you an adult? Get over it.0 -
grizzly1911 wrote: »What about those that aren't so financially savvy who repaid the mortgage smany years ago? The elderly who don't want the risk associated with equities/bonds/funds etc.?
No one is born savvy, but you need to invest time in learning.
I am overpaying my mtg, even when I shouldn't due to the rate being so low and I want to get it paid earlier. But I cut my overpayments a few years back, to make sure I saved more.
The elderly aren't stupid, they can learn too. Like Risk isn't just investment risk, but shortfall and inflation risk are just as dangerous if not mroe insidious.0 -
No one is born savvy, but you need to invest time in learning.
I am overpaying my mtg, even when I shouldn't due to the rate being so low and I want to get it paid earlier. But I cut my overpayments a few years back, to make sure I saved more.
The elderly aren't stupid, they can learn too. Like Risk isn't just investment risk, but shortfall and inflation risk are just as dangerous if not mroe insidious.
No the elderly aren't stupid just born in a different era. with different, ideas, expectations and trust with little risk assimilation and tend to be become more risk adverse.
My mother and mother in law understand % interest, to expect them to appreciate shortfall and inflation risk would be like sending them to defuse IEDs.
Many younger people don't have a scooby either, should"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
My mother and mother in law understand % interest, to expect them to appreciate shortfall and inflation risk would be like sending them to defuse IEDs.
Dont sell them short just because they are older and female. Explain it to them. It is nothing like sending them to difuse a bomb to tell them they should spread their money across some different assest classes and put a small amt in equities.0 -
Dont sell them short just because they are older and female. Explain it to them. It is nothing like sending them to difuse a bomb to tell them they should spread their money across some different assest classes and put a small amt in equities.
I would have made the same point if the respective males were still alive.
What time horizon should they be looking at for equites? Isn't the normal mantra drop equity allocation prior to retirement?
How small amount would be sufficient?
I am not criticising the theory merely the practicality.
The one does have an IFA not sure who benefits the most out of the arrangement.. She doesn't have a clue. The only time anything will register is when the cash point says no."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
The theory of going to cash is if you are going to buy an annuity. That doens't necessarily hold for savings or pension funds to be used for Drawdown.
You need to keep some cash, but invest in other asset classes as well alongside if you want to either match or beat inflation.
I know of no cash accounts that will even match inflation (apart from regular savers perhaps).
The time horizon would be based on how many decades they are estimated to live (based on current health and the relevant cohort data). And if the income produced is stable/rising, the fact that the capital value may fluctuate isn't really all that important.
It is fairly easy to explain inflatio risk to older people who can remember what a loaf cost in 1970 vs now, the price of housing then, and the price of a car/petrol. It would be fairly easy for the simplest to understand their money is shrinking each month of they stay in cash only.0 -
Glen_Clark wrote: »Now Cameron & Osborne are trying to pull the same stunt with taxpayer funded interest free loans on £600k sub prime mortgages to reinflate house prices.
Sub prime no longer exists as far as mainstream lenders are concerned in terms of new advances. Not trying to reinflate house prices either. Merely trying to maintain the status quo. A house price crash is the last thing that the UK needs right now. As this will put enormous strain on the banks balance sheets. Another financial crisis would be extremely damaging, as some of the banks have only just recovered after the PPI scandal.0 -
The theory of going to cash is if you are going to buy an annuity. That doens't necessarily hold for savings or pension funds to be used for Drawdown.
You need to keep some cash, but invest in other asset classes as well alongside if you want to either match or beat inflation.
I know of no cash accounts that will even match inflation (apart from regular savers perhaps).
The time horizon would be based on how many decades they are estimated to live (based on current health and the relevant cohort data). And if the income produced is stable/rising, the fact that the capital value may fluctuate isn't really all that important.
It is fairly easy to explain inflatio risk to older people who can remember what a loaf cost in 1970 vs now, the price of housing then, and the price of a car/petrol. It would be fairly easy for the simplest to understand their money is shrinking each month of they stay in cash only.
I am not so sure they would have been so happy suffering a 40% capital loss as has been experienced recently.
Do you have a phone number perhaps I could ask them to chat to you about it. If you are really good they might even do a Mrs Richards.
I will rescue you later.;)"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 352.3K Banking & Borrowing
- 253.6K Reduce Debt & Boost Income
- 454.3K Spending & Discounts
- 245.3K Work, Benefits & Business
- 601.1K Mortgages, Homes & Bills
- 177.5K Life & Family
- 259.2K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 37.7K Read-Only Boards