Your views please

kidmugsy

bowlhead99 wrote: »

In that case if your contributions are maxed all you can do is take a short deferral to get more money that way. Doing that to get a 10% return (inflation protected) is probably going to be better than the return on the 'suggested portfolio' above.

This is the top up I had in mind.
https://www.gov.uk/statepensiontopup

At age 80 it might be better value that deferral; at age 70 deferral is better value.

UPDATE: for someone of 80 the government calculator shows that top-up is roughly equal in value to deferral. That's a rough statement: the comparison would depend on whether one paid income tax and at what rate, and on various other detailed assumptions. Of course there's nothing stopping someone using both.

oldwiring

To whomever asked about the split of our investments here is what the situation is ( taken from the latest update in Trust net pages). Approximately £43000 is in ISAs/UT; average risk rating 74; average volatility 9.8. The mix is: UK Equity 84%; International Equity 16%.
We have around £70000 in With-profit and Distribution Insurance bonds. The average mix within the funds appears to be: UK Equity 26%; International Equity 15%; Fixed Interest 44%; Property 9%; Money Market 6%. £35000 is in immediate access savings accounts and cash. About 40% could be invested.

oldwiring

kidmugsy wrote: »

This is the top up I had in mind.
https://www.gov.uk/statepensiontopup

...

Just checked that and the immediate premium would take ~ years to recoup, more as future income needs discounting.

oldwiring

Having posted I noted that I'd got the NI site.:o
Where I've looked for the UK scheme seems to have nothing about deferring once the pension is in payment. Am I lloking in the right places? Anyone got a link?

bowlhead99

Here you go. The page has a full 60 page guide/leaflet, and also a link to a short online guide to deferring which is quite basic but easy to follow.

https://www.gov.uk/government/publications/deferring-your-state-pension

It is a good deal, and so expensive for the government that the benefit of deferring for people reaching pension age after April this year is going to be pretty much halved, and also spouse inheritability taken away. As you reached your pension ages on the current system, you get to use the much nicer rules instead!

atush

What do you want/need these savings for exactly?

You say you can easily live on your current pensions, what have you been doing with income from these investments? Is yur current income indexed (your state pensions are, but what about the rest)? Will you have need for capital in the near future?

TBH, if you dont need the income and you have been happy with your investments and how they are performing, you could just leave them as they are.

Or you c an find a proper IFA, as who you have doesnt sound like they are?

oldwiring

Thank you to everyone who has contributed.:beer:

Regarding a number of the foregoing posts, I cannot see how the question arose, considering that I plainly said, how well we lived on our pension incomes

What I am doing is looking to the future, trying to ensure that the results of investments to date are more protected against volatility, so should our circumstances change, (e.g. moving in to care, senior accommodation), the value plus hopefully some gain would be there with less risk of depletion due to a bad market.

Perhaps we need to leave the discussion there!:D

bowlhead99

Yes, you did plainly say that you lived well on your pension incomes, a few posts in to the discussion. But you came wanting views on benefits and pitfalls of a particular approach without explaining what that strategy was supposed to be an approach *to*.

For example, an approach to topping up current income to make life even more comfortable ? An approach to preserving wealth for the next generation? An approach to growing wealth to allow you to more readily afford a change in circumstances such as the need for expensive care or accommodation?

As we weren't given the pertinent information about the needs and goals that you had in mind for *any* type of investment, it is pretty difficult to comment. Only a bit later did you mention that you had enough cash coming in, which allows us to assume that you are not investing for extra income but perhaps for growth or perhaps for low volatility wealth preservation.

Finally, in your very last post, you eventually tell us your goal is to protect your stash from volatility. But you also mention "hopefully some gain" so you are not going all out for maintaining a guaranteed nominal value of what you have - presumably you will aim for some level of modest growth to help preserve real-terms buying power in the long run.

When we're fed information in dribs and drabs it can be quite difficult to help out without going out on a hundred different tangents just in case they might be relevant to you. So while you say you can't see how the questions arose, the answer is: they are a natural consequence of us trying to answer your own questions by first establishing what it is that you want to get from your investments and what you consider would be a success, what you consider would be a failure, how much risk can you afford, what growth or income improvements or cost savings do you want to make, etc etc.

Anyway, to go back to my earlier suggestion on pension deferral for which I gave you the gov UK link. You want to be better equipped to cover future costs, and you would like a decent return without significant risk, right? An "insurance policy" against living a long and expensive life, shall we say? What products are available within an investment portfolio to do that?

One of them is to take (say) a few thousand pounds of your existing cash or investments and "invest them" over the next six months in depositing six months' worth of state pension income in your current account, allowing you to tell DWP that they can stop depositing their pension cheques for the next six months.

As a consequence of using up some of your capital to be able to afford to take that break, when you restart the pension the government will happily pay you a 5.2% greater pension, week in week out, forever for the rest of your life - which could be twenty years or more. You will not find a better guaranteed investment return for a few thousand pounds of your cash, which is linked to inflation like that. It scales up so you could take a full year off for 10.4% greater pension or two years off for almost 21%. However, while it's a great thing for retirees who can afford to do it - and some people in their 60s might defer for several years - it does have a reduced value for someone with only two or three decades left at the most, instead of younger people with four or five.

This is not being suggested because we think you are particularly short of income month to month. It is being suggested because it is a way to spend cash or investments now on something that produces a sold reliable income into the future and grows total wealth so you can more easily afford care home costs or inheritances etc.

Anyway, have fun making your investment decisions. If you have a decent amount of wealth to justify paying for some independent financial advice then, yes, see an IFA. The portfolio they come up with does not need to be particularly exotic or traditional it just needs to be something that you understand and is fit to do the job you want it to do.

kidmugsy

oldwiring wrote: »

Just checked that and the immediate premium would take ~ years to recoup, more as future income needs discounting.

Or less, as it's inflation-protected.

atush

and it would be most helpful if you answered questions asked, like those in my post 17 and others posts.

If you just want to stop market volatility, you move to cash, if you want to make sure you dont run out of cash for care home fees, you need to stay in something that gives growth.

I suspect your needs fall in between the 2.