Is it possible to become a millionaire (or near to) through investments?

bowlhead99

Well if the youngster's rent is high then the UK income of the people renting to them is high, and the motivation of the renters to get high paying jobs so far as possible is high, so there are still plenty of people paying tax to fund the government's outgoings such as your pension.

As a 'young professional' I went overseas for a while, so dropped out of paying UK tax, but am now back. While such experiences can be great for both a career and for personal development, for most it is still more convenient to live near friends and family rather than have to live miles away in a foreign city with a less familiar culture and/or language, to save some money on rent.

So talk of a 'brain drain' due to the current government's attitude to housing policies is similar to saying there would be a 'brain drain' due to previous governments' policies on higher income tax rates. You can say it logically follows - but for most people they just shrug and get on with it rather than relocate their life internationally, unless they were the type of person who wanted to relocate their life internationally anyway.

Glen_Clark

bowlhead99 wrote: »

there are still plenty of people paying tax to fund the government's outgoings

so why is the National Debt rising (at £5,170 a second) http://www.nationaldebtclock.co.uk/

Glen_Clark

I'm hoping to have enough investment income to live modestly when I retire. If G.Osborne's Housing Market Interventions haven't bankrupted us by then, my State Pension will be a bonus. But I dare not calculate and count on it.

Glen_Clark

bowlhead99 wrote: »

As a 'young professional' I went overseas for a while, so dropped out of paying UK tax, but am now back. While such experiences can be great for both a career and for personal development, for most it is still more convenient to live near friends and family rather than have to live miles away in a foreign city with a less familiar culture and/or language, to save some money on rent.

So talk of a 'brain drain' due to the current government's attitude to housing policies is similar to saying there would be a 'brain drain' due to previous governments' policies on higher income tax rates. You can say it logically follows - but for most people they just shrug and get on with it rather than relocate their life internationally, unless they were the type of person who wanted to relocate their life internationally anyway.

But that was before G Osborne's housing market interventions pushed housing costs through the roof!

bigadaj

bowlhead99 wrote: »

Well if the youngster's rent is high then the UK income of the people renting to them is high, and the motivation of the renters to get high paying jobs so far as possible is high, so there are still plenty of people paying tax to fund the government's outgoings such as your pension.

As a 'young professional' I went overseas for a while, so dropped out of paying UK tax, but am now back. While such experiences can be great for both a career and for personal development, for most it is still more convenient to live near friends and family rather than have to live miles away in a foreign city with a less familiar culture and/or language, to save some money on rent.

So talk of a 'brain drain' due to the current government's attitude to housing policies is similar to saying there would be a 'brain drain' due to previous governments' policies on higher income tax rates. You can say it logically follows - but for most people they just shrug and get on with it rather than relocate their life internationally, unless they were the type of person who wanted to relocate their life internationally anyway.

So sounds like increasing your income tax rate to 60-70% plus wouldn't affect your view as well?

It's interesting the interaction between different elements of living costs, we lived in Hong Kong in the nineties and with a maximum tax rate on income of 15%, think I paid around 12%, much of the population ended up paying rents of several times that.

People will adapt to a large extent but it is dependent on the alternatives available and the relative push and pull, I think I'd be looking overseas now if I were twenty years or a bit more younger.

Glen_Clark

bigadaj wrote: »

we lived in Hong Kong in the nineties and with a maximum tax rate on income of 15%, think I paid around 12%, much of the population ended up paying rents of several times that.

Hong Kong has a genuine shortage of building land. Their building land shortage hasn't been created artificially, like in Britain.

talexuser

I worked in Germany during and after university, and although the money was excellent, and the people great, you do miss the little things in life you were used to, silly things like newspapers and tv and familiar chat (and home ownership). The one thing it taught me was how efficient an organisation could be if everyone was pulling in the same direction, coming back here to work the change was quite an eye opener.

bowlhead99

Glen_Clark wrote: »

But that was before G Osborne's housing market interventions pushed housing costs through the roof!

There are all kinds of practical and social issues which mean that people will not "up sticks" and relocate internationally just because the cost of rent in a city, or bread, or beer, or tax, has gone up. I'm sure the Opposition who want more tax income, feel they can get away with a higher take without people suddenly taking flight.

But if housing costs are through the roof such that affluent young professionals run off in their droves to Germany, perhaps such extortionate costs will also limit the number of economic migrants coming here and fueling the demand for the limited space.

Glen_Clark wrote: »

so why is the National Debt rising (at £5,170 a second)

Because taxes (pulling money out of the economy) have not been raised sufficiently to cover the expenditure. Pulling money out of the economy does not help growth, employment etc. Sometimes governments of all colours run deficits.

Yeah yeah, the expenditure shouldn't be on anything that risks sustaining the current property prices, we get it. I guess if Boris leads us out of EU then it will be harder for people to come here and harder for our brains to drain, so should all be fine in terms of safeguarding your pension.

bigadaj wrote: »

So sounds like increasing your income tax rate to 60-70% plus wouldn't affect your view as well?

It's interesting the interaction between different elements of living costs, we lived in Hong Kong in the nineties and with a maximum tax rate on income of 15%, think I paid around 12%, much of the population ended up paying rents of several times that.

People will adapt to a large extent but it is dependent on the alternatives available and the relative push and pull, I think I'd be looking overseas now if I were twenty years or a bit more younger.

As a youngster it's certainty worth "shopping around" if you don't like tax rates, laws, housing costs, job opportunities etc etc. And many do.

But Glen is worried that all the kids will run off and not be around to pay his state pension and my point is that most of them will stick because there are practical "barriers to entry/exit" when it comes to what country you're going to live in and what city you prefer. That helps to create a somewhat inelastic curve of demand against supply in the face of cost of living changes which is perhaps why house prices do not self-moderate so much, just like demand for cigarettes or petrol versus price before people became more health and enviro-conscious.

Yes if tax rates went up to 70% I would look around elsewhere, much as I would if London property prices trebled from here relative to salaries - which I don't expect them to. As it is, I've had the 60% effective marginal rate which is quite painful but it is only a relatively small band and then back to 40/45% which is not completely intolerable.

If income tax rates were 10-15% or 0% as is some places it would make somewhere sound good on paper but the extra cash in peoples pockets translates to high prices for goods and property, not to mention an even wider disparity between the haves and the have nots, which isn't always attractive (e.g. Dubai).

BananaRepublic

talexuser wrote: »

Fair enough, I'm quoting a firm of pension experts who I believe are more likely know more about the subject than you, other articles are warning that many thousands or even millions expecting £155 are not going to get it. I could just as well ask you to prove " the new scheme is better for low paid workers" since that is just as meaningless as any other blanket statement without detail and qualifications. We're going round in circles now so better agree to disagree. We shall see when the new system kicks in just how satisfactory the vast majority reckons it is.

We are not going round in circles, you are repeating the same thing over and over which can be summarised as "Pension experts claim ... " followed by "Oooh, pension experts, very clever, must be right". Unfortunately that quote is lacking in specifics and it is in a left leaning newspaper, and relates to policies from a right leaning goverment. Colour me sceptical, but I have no idea what the quote means. As I've said, what are the assumptions they made in their calculations? Without those, it's meaningless. Of course I could be mistaken in my views, but without alternative calculations, they are the best I have got. And yes I've seen false claims and hyperbole in the Telegraph.

talexuser

Ok then , don't believe it, in the same way I don't believe you without the same "proof", each entitled to his own opinion. We shall see when the new system comes in.