Transferring PEPS

capricorn36

dunstonh wrote: »

You are aware of the loss potential of such funds and its only fixed interest sector funds that pay interest?

I am aware of the loss potential, so perhaps I should be looking at fixed interest sector funds that pay interest. Are these listed anywhere or can you point me in the right direction please?

Do you want to use savings or investments? At the moment you are using and looking at capital-at-risk investments.

I want to use the £25,000 wisely, to bring in an income, but I don't know where to look to put it into something that will keep pace with inflation and let us draw interest.

I suppose I wouldn't mind an element of risk like the JPM Global High Yield Bonds, for some of the money (don't know what proportion).

I also suppose we ought to have an IFA, but we had such a bad experience with our last one, even now with the JPM Global High Yield Bonds, we are still losing £2,000 on our original investment which was in 1996. Of the other investments he suggested so that we would receive a dividend/interest?, we ended up by being paid out of our own capital, so I really don't have a lot of faith.

dunstonh

I also suppose we ought to have an IFA, but we had such a bad experience with our last one, even now with the JPM Global High Yield Bonds, we are still losing £2,000 on our original investment which was in 1996.

I am very surprised you are in a loss position. For that to happen you must be drawing all the income with none of it reinvested. However, that doesnt make it bad advice. It would have wiped the floor compared to a savings account. I think your understanding is making you think it was bad when actually its good.

The fund launched in 1999 (not 96). If you invested at launch and drew all the income your capital value would currently be down 17%. However, the income has more than compensated for that. If you factor that into it (and the loss) the total return over that period has been 106.02%. That is an annual equivalent return of 6.4% after tax and charges.

Of the other investments he suggested so that we would receive a dividend/interest?, we ended up by being paid out of our own capital, so I really don't have a lot of faith.

There are very good reasons for doing that. You can make capital gains of £10k a year tax free. So, by using capital withdrawals rather than natural income, you can reduce the amount of tax you pay.