Feedback welcome on plans for my £77k

donny_jim

you do not seem to be doing to badly, the h.lansdowne s&s isa is good and they give a lot of info, as to were to put it inv per h.income has done well but who knows if it will continue. as they say pick funds from diferent sectors to spread the risk. as for your pension i think a sip (with h.lansdowne) would be good for you. remember if you lost your job you would have to live on your savings, but anything in a pension is safe. could you live on the money you say you are making £900p.m is good but could you do it if you were relying on it. how come you did not mention the 123 a/c paying 3% on up to 20k

Eduardo001

dk7 wrote: »

Any ideas what to do with this? Zopa, funding circle? Save to invest in a BTL?

Funding Circle is worth a look and you may be able to get a better return there than you can from the ISAs.

And you can always sell the loans parts if you need the money in a hurry which is another benefit.

Just a word of warning with Funding Circle though - it's not uncommon for the higher risk loans to go into administration meaning that you lose most if not all of your capital associated with those loans. So be careful there and from past experience, I'd recommend ideally sticking to A or A+ rated loans.

tom9980

Santander 123 account pronto!

I understand Match betting/trading/casino's obviously some here think already your a degen, we both know you are not. Keep doing it since its tax free.

110% start your pension.

Stocks and share ISA's are next fill the whole lot every year from your match betting profit do this for as long as the game lasts and you will have a very nice portfolio in years to come. Id go with passive portfolio's like those on http://monevator.com/the-slow-and-steady-passive-portfolio-update-q3-2013/ it is the easiest lazy way to do things right now.

I would ignore funding circle and zopa because of your tax status.

atush

Join your work pension IMMEDIATELY!!!!!! You are flushing free money down the toilet, plus paying the taxman more than you need to. Both of you in fact. Email HR right now if you are at work.


Do not delay another day. OH too. Each 100 into your pension has a net cost to you of 60 (even less if you have salary sacrifice). Put in enough to get max employers contrib and to take you out of HRtax.

Then, are any of your cash isas and S&S one this years? ARe you married to your OH? If you have another allowance, i'd whack the 12K in the esaver into a S&S isa.

dk7

Thanks for the further feedback. I know an E'er matched pension should be my number one move. However as dumb as it sounds I intend to be moving job in the next couple of months and sorting out starting one with my current E'er to then move it over to a SIPP or new scheme in just a few weeks/months time doesn't seem worth the hassle. Or how easy would this process be?

In a new job, yes i plan to max any E'er contributions. I can see its a no brainer for free money and tax savings.

As for the o/h she already max's her ISA allowance each year, plus max's her E'er pension contributions, and is still a 40% tax payer so not sure transferring money into investments in her name would help?

What is the rationale behind contributing to a pension above any E'er contribution until i'm under the 40% tax band?

I know i get a boost on the way in, (i put in 60, tax rebate makes that 100) but surely my pension will be taxed on the way out, plus its then at the vagaries of the annuity rates in a long time. Another risk to consider.

Finally not sure i understand the love for the santander 123 a/c long term? 3% yes but a £2 a month fee. Would be better moving my bills account to 123 for the cashback.

Especially when I only intend to keep circa £10k in cash long term (ignoring my gambling float, as that is in account where they don't block my account every time I move a £1k into betfair!). That £10k cash can be sheltered in nationwide/lloyds vantage for a better return.

Obviously i can put the left over £12k + £2kish a month going forward into a santander 123 account for now, but that isn't a long term play. The big question is what to do with this long term?

The fact bad debts aren't tax deductible for zopa and funding circle has put me off them for any significant investment. I might dip my toes in with a £1k to see how i go return wise but its not ideal. Maybe its time to start seriously looking at a BTL.

Anyway cheers for the advice received, its good to be getting a handle on all this.

jem16

dk7 wrote: »

Thanks for the further feedback. I know an E'er matched pension should be my number one move. However as dumb as it sounds I intend to be moving job in the next couple of months and sorting out starting one with my current E'er to then move it over to a SIPP or new scheme in just a few weeks/months time doesn't seem worth the hassle. Or how easy would this process be?

Shouldn't be any great problem to transfer it if it's necessary. Many people have said they plan to move and are still there years later. Take the free money now.

As for the o/h she already max's her ISA allowance each year, plus max's her E'er pension contributions, and is still a 40% tax payer so not sure transferring money into investments in her name would help?

It wouldn't help no. Does she use her full ISA allowance both for cash and S&S or just cash?

What is the rationale behind contributing to a pension above any E'er contribution until i'm under the 40% tax band?

I know i get a boost on the way in, (i put in 60, tax rebate makes that 100) but surely my pension will be taxed on the way out,

The idea is that you may well be a basic rate taxpayer in retirement so 40% tax relief on the way in and 20% on the way out.

By the way if it's pension contributions made after tax, then you would put £80 in which is then upped to £100 through basic rate tax relief. The other 20% you claim back from HMRC.

plus its then at the vagaries of the annuity rates in a long time. Another risk to consider.

You don't have to use an annuity. You can use Income Drawdown.

Finally not sure i understand the love for the santander 123 a/c long term? 3% yes but a £2 a month fee. Would be better moving my bills account to 123 for the cashback.

Where else will you get 3% on £20k? Yes to offset the fee use the bills that gain cashback.

Especially when I only intend to keep circa £10k in cash long term (ignoring my gambling float, as that is in account where they don't block my account every time I move a £1k into betfair!). That £10k cash can be sheltered in nationwide/lloyds vantage for a better return.

If it's only £10k then yes that's better.

dk7

Shouldn't be any great problem to transfer it if it's necessary. Many people have said they plan to move and are still there years later. Take the free money now.

Ok, will look into it then.

It wouldn't help no. Does she use her full ISA allowance both for cash and S&S or just cash?

Yep, full S&S allowance used each year.

The idea is that you may well be a basic rate taxpayer in retirement so 40% tax relief on the way in and 20% on the way out.

By the way if it's pension contributions made after tax, then you would put £80 in which is then upped to £100 through basic rate tax relief. The other 20% you claim back from HMRC.

Can see re basic rate in retirement, but if i get my act together then maybe not. Plus trying to guess govt treatment of tax on pensions etc on a 30yr+ horizon means I think i'm more keen to just max E'er contributions, then invest my remaining money elsewhere.

Noted re post tax pension contributions.

You don't have to use an annuity. You can use Income Drawdown.

Off to learn about this. Do you just mean you can take 25% lump sum at 55?

Where else will you get 3% on £20k? Yes to offset the fee use the bills that gain cashback.

If it's only £10k then yes that's better.

Re santander 123 a/c can you have a second a/c in joint names? For admin purposes we just fund a joint a/c each month to cover joint expenditure.

If I could get one in my sole name for the remainder of my cash, then i will do it.

However long term I want the £12k + £2kish extra a month i'm generating to work harder for me than 3% gross or 1.8% net. That's the tougher bit!

jem16

dk7 wrote: »

Off to learn about this. Do you just mean you can take 25% lump sum at 55?

You can take your 25% tax-free lump sum and leave the rest invested from which you can take an income ( or not if you don't want to ) subject to GAD rates.

Re santander 123 a/c can you have a second a/c in joint names?

Yes you can.