Self employed retirement

justme111

Why you are so reluctant to pay others for their services ? I guess you do not grow your own food but get it in the supermarket - what's wrong in seeing accountant once a year and IFA may be once every few years ? You free not to do that to of course but then you either miss out on stuff and are likely worse of financially or you learn the stuff yourself - I for once do not see two camps in the responses you mentioned for example so your interpretation may be a bit off. There is no point in getting stressed that you don't understand something but not want to pay someone to explain it to you either.

AlanP_2

When I was self-employed (not Ltd. company) I used an accountant to finalise the end of year figures and prepare tax return.

The saving made on tax each year, by knowledgeable application of different allowances etc., covered their bill quite easily.

kangoora

SamW123 wrote: »

Thanks to everyone for all the replies. It's clear though that there are two broad camps here - those who say that we should be ok based on the target / expected savings provided we work out our costs at the time, which shouldn't be huge- and those who say that far from being ok, we will actually be stuffed unless we invest in stocks and shares / pensions (which would mean hiring an accountant, an investment advisor and perhaps other experts).



I'm not the sharpest tool in the box but I'm pretty sure that these schools of thought can't both be true, so I guess I need to figure out what to do next.

Funny how different people see the same words. I see multiple people including several whose contributions I respect posting that you need to see an accountant, get an IFA and sort out pensions and investments.

I see one poster, who I don't remember seeing before on this forum, saying 'Don't worry mate, you'll be fine'

I know what conclusion I'd take from this.

SamW123

Have to say I'm more worried now than I was before posting! I really don't want to go down the road of investments and all the risk that that entails, particularly if I end up having to trust an "advisor" (bearing in mind I know very little about financial things, I feel it it would be very easy for to be hoodwinked or misled). I've given it some thought and I reckon the safest option might be to give up on the early retirement thing and just continue working- I do at least have that option, and it would hopefully at least ensure I don't run out of money. Anyway, thanks to everyone for the replies.

dunstonh

I really don't want to go down the road of investments and all the risk that that entails, particularly if I end up having to trust an "advisor" (bearing in mind I know very little about financial things, I feel it it would be very easy for to be hoodwinked or misled).

This is 2019. Not 1989. IFAs deal with millions of transactions a year. yet only have around 1500 complaints at the FOS each year and most of them get rejected. If you see a sales rep, you are being sold to. If you see an IFA you get advice. The main issue with IFAs is not quality of advice but the charges. Some are quite greedy. However, knowing that, you can avoid them.

I've given it some thought and I reckon the safest option might be to give up on the early retirement thing and just continue working- I do at least have that option, and it would hopefully at least ensure I don't run out of money. Anyway, thanks to everyone for the replies.

It seems strange to make life decisions based on paranoia and lack of knowledge.

BobQ

SamW123 wrote: »

We've been self-employed for a long time so don't have employee pensions.

You conclude that there are two schools of thought although there are probably more than that.

My impression is that for people who have shown the enterprise to build a business for "a long time" you are remarkably cautious.

You note that being self employed you do not have the benefits of an employee pension. Just because you are self employed is really not a reason for not having a pension. While that is water under the bridge, I suggest that now is the time to grasp the many tax benefits that are available to those in a Partnership and invest in a pension while you still have time. You do realise that employee private pensions are also invested in stocks and shares? Even within private pensions there is scope for different levels of risk. My point is that if you are unwilling to take any risk you may find yourselves without enough for a pension of the level you want. As dunstonh said, you are just swapping one kind of risk for another.

Are you planning to keep your house? Or will you downsize?

You seem determined not to sell your business, but surely there are options for you to progressively release capital while your son progressively buys a share of it by him borrowing?

BobQ

SamW123 wrote: »

Have to say I'm more worried now than I was before posting! I really don't want to go down the road of investments and all the risk that that entails, particularly if I end up having to trust an "advisor" (bearing in mind I know very little about financial things, I feel it it would be very easy for to be hoodwinked or misled). I've given it some thought and I reckon the safest option might be to give up on the early retirement thing and just continue working- I do at least have that option, and it would hopefully at least ensure I don't run out of money. Anyway, thanks to everyone for the replies.

You could start a private pension without trusting an IFA, by just making the investment decisions yourself. Every year that does by you are losing an opportunity to gain a tax benefit. However, in your circumstances it would be advisable to consult a professional.

New_and_Improved_Me

Being self-employed and NOT having a conventional pension, you really have to think about how you will support yourself post retirement age.

Being self employed myself, I have NEVER had a pension (and DO NOT plan on getting one) but rather have planned alternative means of income (Current plan - win the lottery..:)

Joking aside, having a good accountant is always worth the money – not sure about mine at the moment so may be moving this year.

If you have 70/80K saved up, you could look at a Buy-to-let?

However, that does brings its own issues but you can make decent % return if you play it right.

As for stock Market - I had my fingers burn quite badly with Stock a while back so am VERY cautious when it comes to the stock market, I prefer physical Brick and mortar.

However, there is money to be made on the stock market if you know what you’re doing.


Everyone if different and you have do what is best for you.


Good Luck.

dunstonh

As for stock Market - I had my fingers burn quite badly with Stock a while back so am VERY cautious when it comes to the stock market, I prefer physical Brick and mortar.

If you had your fingers burnt on the stockmarket that means you either invested badly and non conventionally or you did things you shouldnt do.

I prefer physical Brick and mortar.

And people who invest in property badly and make bad decisions also get their fingers burnt.

However, there is money to be made on the stock market if you know what you’re doing.

You don't need to know what you are doing. If you don't you either employ an iFA or stick to a multi-asset fund. It helps to understand the basics of course but your knowledge on what to do with conventional investing doesnt need to be advanced unless you start building your own portfolio.

If you have 70/80K saved up, you could look at a Buy-to-let?

You typically need around 5-6 properties for a secure retirement income. One property is high risk and unlikely to be anywhere near enough.

AlanP_2

If you are put off by the "risk" associated with S&S Funds / Bonds investments at least consider opening a pension,paying money in and leaving it in cash.

HMRC will boost it by 25% .

You will lose out to inflation, which is a "guaranteed" as opposed to "possible" way of losing money but you will anyway if you don't put the cash in a pension.