Pension recovery from covid

Prism

Thrugelmir said:

Prism said:

Deleted_User said:

Thrugelmir said:

itwasntme001 said:

If you do not like long duration bonds at current levels, you should also be thinking twice about investing in that "growth" fund.

 One wonders if there'll be a period of subsequent flat lining, akin to the US in the 1980's in the medium term. 

I sure hope it will flat line like that.  S&P 500 went from 105 at the start of 1980 to 353 at the end of 1989. Once you account for dividends and reinvestments, the line flatted upward at a very decent angle. 

I wonder if Thrugelmir mean the 70's. Just about positive over the decade but negative after inflation.

No the 80's. S&P underperformed both cash and inflation for a period. 

It did for a couple of years at start. I think the 70s is a better example of a lost decade of S&P investing with high inflation and low equity returns at the end of the nifty fifty period when evaluations were very high.

german_keeper

TBC15 said:

german_keeper said:

Play nicely now children. For what it's worth I haven't got a clue what either of you are on about. To be honest only because I have zero interest in investments.

IMHO you may have picked the wrong forum to peruse.

Why? It's a pension forum and I've always had a healthy interest in my pension. I've learnt lots of useful things during my perusing. Try as I might I just can't develop any interest in all this investment stuff. But each to their own, there are clearly plenty of people who do.  

Thrugelmir

Prism said:

Thrugelmir said:

Prism said:

Deleted_User said:

Thrugelmir said:

itwasntme001 said:

If you do not like long duration bonds at current levels, you should also be thinking twice about investing in that "growth" fund.

 One wonders if there'll be a period of subsequent flat lining, akin to the US in the 1980's in the medium term. 

I sure hope it will flat line like that.  S&P 500 went from 105 at the start of 1980 to 353 at the end of 1989. Once you account for dividends and reinvestments, the line flatted upward at a very decent angle. 

I wonder if Thrugelmir mean the 70's. Just about positive over the decade but negative after inflation.

No the 80's. S&P underperformed both cash and inflation for a period. 

It did for a couple of years at start. I think the 70s is a better example of a lost decade of S&P investing with high inflation and low equity returns at the end of the nifty fifty period when evaluations were very high.

My mistake. Was the 70's through to part way through 1982.  That's why I had the 80's in my head. 

[Deleted User]

The real return of S&P500 in the 70s was negative but worldwide it was positive. Same happened in 2000s.

Prism

Deleted_User said:

The real return of S&P500 in the 70s was negative but worldwide it was positive. Same happened in 2000s.

Agreed. I only usually use it as an example when the crazy youngsters post 'S&P 500 is all you need'. Trouble is being youngsters they rarely listen

TBC15

german_keeper said:

TBC15 said:

german_keeper said:

Play nicely now children. For what it's worth I haven't got a clue what either of you are on about. To be honest only because I have zero interest in investments.

IMHO you may have picked the wrong forum to peruse.

Why? It's a pension forum and I've always had a healthy interest in my pension. I've learnt lots of useful things during my perusing. Try as I might I just can't develop any interest in all this investment stuff. But each to their own, there are clearly plenty of people who do.  

Fair enough, if you don’t mind me asking what form does your pension take? If it doesn’t vary with the markets what attracted you to the Pension recovery from covid thread?

Thrugelmir

Prism said:

Deleted_User said:

The real return of S&P500 in the 70s was negative but worldwide it was positive. Same happened in 2000s.

Agreed. I only usually use it as an example when the crazy youngsters post 'S&P 500 is all you need'. Trouble is being youngsters they rarely listen

The recovery in the S&P coincided with the launch of the initially the IBM Displaywriter followed by the IBM PC.  

german_keeper

TBC15 said:

german_keeper said:

TBC15 said:

german_keeper said:

Play nicely now children. For what it's worth I haven't got a clue what either of you are on about. To be honest only because I have zero interest in investments.

IMHO you may have picked the wrong forum to peruse.

Why? It's a pension forum and I've always had a healthy interest in my pension. I've learnt lots of useful things during my perusing. Try as I might I just can't develop any interest in all this investment stuff. But each to their own, there are clearly plenty of people who do.  

Fair enough, if you don’t mind me asking what form does your pension take? If it doesn’t vary with the markets what attracted you to the Pension recovery from covid thread?

We both have decent DB pensions and full state pensions. Mrs GK already got enough conts, I will by April 23. I'm a Civil Service lifer and I have always understood the pension but until the pension reforms a few years ago I was just sleepwalking into retire at 60 with a "full" pension, very typical in my experience. Thanks ironically to the pension reforms and information on this forum I now have a much better all round view of retirement planning.   

We both now have DC pensions which we will drawdown between retirement date and SPA. Currently aiming for April 23 when I will be 58 and Mrs GK 57. Both DC are in low risk lifestyle type funds. Mine has grown by about 4% pa on average since I started in 2015 which I am happy with. I haven't looked at hers properly, she only has about £3k in there and the main purpose is to put £500 per month in for the tax relief. It will be tax free on the way out whereas I will already be over PTA. One of the things I picked up from this forum.

Recently I have been reading some of the investment discussions with a view to maybe doing something different with our DC schemes but it really doesn't float my boat at all. The reason I looked at this one was just to compare how our pensions had performed during Covid with others. What I can say, and I think this is because of the last few months, is that my attitude towards investments has definitely changed from paranoia to mild fear! It's been quite an interesting experience although I have read comments that this hasn't been anything like some of the other crashes over the years so I am hoping that I don't get to experience one of those.    

Cus

Does that mean that you are no longer working at the place where you were included in a DB scheme, and so the DC is from your new work? Or was it financially better to contribute to personal DC in addition to the DB scheme rather than top ups?

german_keeper

Cus said:

Does that mean that you are no longer working at the place where you were included in a DB scheme, and so the DC is from your new work? Or was it financially better to contribute to personal DC in addition to the DB scheme rather than top ups?

I moved to the Partnership scheme. I worked out how much Alpha would pay pa from age 60 with 7 years actuarial reduction. Then I worked out how much would be paid into Partnership over the same period and a full drawdown between 60 and 67 would pay almost double pa. Given that we had 2 full state pensions we would have a massive discrepancy in our income pre and post SPA.

The main stumbling blocks were giving up the guaranteed CPI increase to Alpha accrual and my mistrust of investments. The old phrase the value of shares can fall as well as rise was imprinted on my mind! I have a spreadsheet which is called "A Bit of Bully" (let's see what you would have won) where I track the Alpha entitlement against Partnership pot and currently showing more than double pa and over 15 years till the total amount paid by Alpha is higher than the Partnership pot. So still happy with my decision.

The contribution to Partnership is only 3% against 5.45% for Alpha. This wasn't really part of the reasoning but given the fact that my salary is only 5.99% higher now than it was in 2010 this proved very useful as things were getting very tight up to the point we paid the mortgage off a couple of years ago.