Trying to work out interest when retired..

1echidna

jem16 wrote: »

Perhaps you had better read somewhere more useful. FTSE 100 trackers have been the worst performing funds for the last 14 years approx.

I stand corrected, I watch out if I see it again and see what the parameters are.

dunstonh

Some further thoughts on dunstonh post above. I think I have read somewhere that FTSE 100 trackers have outperformed the vast majority of funds but no matter.

Jem is correct, FTSE100 trackers have been bottom half performers for 14 years. It isnt a particularly good index to track as its too limited. FTSE all share trackers perform at mid table consistently but you would expect that.

There are some areas where trackers are ideal and there are some where they are not. If you had a general UK growth fund investing only in the FTSE100 then you would expect a FTSE100 tracker to outperform it over the long term. However, many of the managed funds in the UK all companies sector have aims and objectives which allow them to focus on other areas or have a wider remit.

Once stockbrokers were flavour of the month now IFAs are. My prediction is that in five or six years time they will be regarded in the same light as endowment policy salesmen from a a decade or so ago are. No doubt they have learnt from these events involving blatant mis selling and now always give the appropriate caveats but I doubt if official advice (eg FSA) will still include using them.

As from next year, the FSA have proposed that IFAs will be the only type of adviser with higher qualifications required than current. So, I doubt your prediction will be correct. The FSA has allowed sales and advice to merge and they intend to clearly seperate the two things again to raise standards. About time too.

jamesd

1echidna, your do it yourself approach is the one I've taken for myself but it's worth remembering that ipri was asking about using savings accounts for close to 400,000. An IFA is likely to be a good first stop in that context, particularly if the advice received is reviewed here.

dunstonh, I suppose stock brokers will still be able to advise on PIBs, preference shares and investment trusts, while IFAs will generally be limited to non-IT collectives and not advising on these things?

It'll be interesting to see whether the changed rules increase business for the remaining IFAs and encourage growth of a larger number of capable people and firms in the business.

dunstonh

dunstonh, I suppose stock brokers will still be able to advise on PIBs, preference shares and investment trusts, while IFAs will generally be limited to non-IT collectives and not advising on these things?

Yes, it wont change those individuals. It will just reduce the numbers of financial advisers in that you wont have tied advisers or multi-tied advisers any more. The only advisers will be IFAs. The tied agents and multi-tied agents will in future be sales reps (which they always have been but they wont be able to pretend they give advice anymore).

It'll be interesting to see whether the changed rules increase business for the remaining IFAs and encourage growth of a larger number of capable people and firms in the business.

It will reduce the number of IFAs as many wont want to sit the higher qualifications. Especially those in their 50s (average age of an IFA is 52 apparantly). I have already been approached by 3 IFAs to discuss them joining my firm as mortgage advisers and introducers to me for investment business. Mortgage advisers have lower regulation and qualification standards so for those IFAs that want to see out the last few years it would be the ideal option. Its that or become a sales rep for a bank.

ipri

The advice has been excellent...It looks like I've been factoring the personal allowance incorrectly...thats sorted for my wife's income....I've been re-evaluating my own...can someone correct me if I'm wrong?

Annual Pension £41557...?? - £6000 = £35557 @ 20% tax leaves. £7111

Therefore ..net income..= £41557 - £7111 = £34446

Not sure if I've taken £6000 personal allowance off correctly? Thanks again ian

jem16

It's correct now although the personal allowance is £6035 not £6000.

Is your pension your whole taxable income - no savings/dividends in your name?

earlgrey_3

jem16 wrote: »

Perhaps you had better read somewhere more useful. FTSE 100 trackers have been the worst performing funds for the last 14 years approx.

Jem, I'm not quite sure what you meant to say but I'm sure it wasn't that. I don't know of any FTSE 100 tracker that has come close to being as bad as the worst funds.

As Dunstonh has pointed out the FTSE 100 trackers haven't done as well as the All Share trackers recently.

I wouldn't strictly agree with the statement "It isnt a particularly good index to track as its too limited." though. That's like saying a mining fund isn't very good because it's too limited. It's very good if you happened to be in it at the right time. FTSE 100 shares haven't done as well as those in the All share index in recent years, next year it may all change. FTSE 100 trackers might be the better bet. If you want to concentrate on the FTSE100 that's the tracker for you. You pays your money and you takes your choice.

Most All share trackers are consistently in the top half of best performers, which is something few managed funds can claim. The exceptions among trackers are those that charge well above the going rate in order to pay annual trail commision to intermediaries. The best performers have charges of just 0.25% which gives a hard time to managed funds charging six times as much and more. Unfortunately, as there's little room for any trail commission in there, they're unlikely to be favourites with commission-based advisers.

As Dunstonh points out they have their uses and their limitations. They'll never be the complete and only answer to investment as some portray them.

purch

They'll never be the complete and only answer to investment as some portray them.

Nothing ever is........

earlgrey_3

purch wrote: »

Nothing ever is........

Starting to look that way. And you can bet that if someone ever discovers it he won't go flogging it to you and me for 0.5% commission. :rolleyes2

ipri

Hi Jem16...This will be my only income...all our savings will be put in my wife's name to avoid higher rate tax... thanks ian