Investments - Strategies, Ideas, Options & advice

[harpo_72]

I am totally confused, why are saving ISAs fixed at so low percentages when the stocks and share ISAs are absolutely smashing it? 4-7% per annum vs 3-8% per month … even if the markets calm down the savings ISA should be looking at 10% .. of have I misunderstood?

 

[Mel Smooth]

I am totally confused, why are saving ISAs fixed at so low percentages when the stocks and share ISAs are absolutely smashing it? 4-7% per annum vs 3-8% per month … even if the markets calm down the savings ISA should be looking at 10% .. of have I misunderstood?

Risk v reward plus the people supplying your savings ISA have to cover the guaranteed interest rate plus their own profit (which is probably way above the few percent they are giving back).

 

[harpo_72]

Risk v reward plus the people supplying your savings ISA have to cover the guaranteed interest rate plus their own profit (which is probably way above the few percent they are giving back).

I suspect they are doing very well .. perhaps a more positive approach to customers is required. It stuff like this that turns me away from most financial services

 

[Crazyface]

In my experience, once you’ve started drawing it, that’s it
Which is why it pays to get proper advice that gives you all the options before you start taking your pension.

It might cost a few thousand, but is well worth it in the long run

Yes, but I had £76k and knew I wanted to get it on a draw down. I HAD to go to through and advisor, and despite me telling him from the outset that is what I wanted to do and why was he bothering to do all his sums. Well I know now. He gets a fee for doing it. It actually cost me nothing. So he went away with all my personal and private details, Christ Alive they want to know EVERYTHING. He came back with all his projections and rubbish and told me he advised to put it, oh I forget, and have a monthly pension of something stupid like £200 a month. This ment I would have to live till I was about 86 to get all me money. And also the pension fund could keep it all. Because of this, it took me about 3 months to find a company who would take it on as a draw down as everyone else was scared to death to touch it once I had been advised to take it as pension. It's all a con!!!!

 

[PhilTheFragger]

Yes, but I had £76k and knew I wanted to get it on a draw down. I HAD to go to through and advisor, and despite me telling him from the outset that is what I wanted to do and why was he bothering to do all his sums. Well I know now. He gets a fee for doing it. It actually cost me nothing. So he went away with all my personal and private details, Christ Alive they want to know EVERYTHING. He came back with all his projections and rubbish and told me he advised to put it, oh I forget, and have a monthly pension of something stupid like £200 a month. This ment I would have to live till I was about 86 to get all me money. And also the pension fund could keep it all. Because of this, it took me about 3 months to find a company who would take it on as a draw down as everyone else was scared to death to touch it once I had been advised to take it as pension. It's all a con!!!!

Using the 4% rule , ( you draw down a maximum of 4% of your £76000 a year. ) That should give you around 250 per month, keeping the £76k intact.

The danger with drawdown is you run out of money, before you die.

76k isn’t a lot and you can’t just live on that, therefore there will be the temptation to take a bit extra, which will quickly reduce your available cash.

Therefore , in this instance, a smaller annuity might be better in the long term as it will keep on paying until you croak

The professional indemnity insurance that IFA’s have to have is very very expensive, they absolutely have to do it by the book.

If an IFA , with all relevant information and aware of your wishes suggests a certain course of auction, I’d be listening to them

 

[PNWokingham]

I am totally confused, why are saving ISAs fixed at so low percentages when the stocks and share ISAs are absolutely smashing it? 4-7% per annum vs 3-8% per month … even if the markets calm down the savings ISA should be looking at 10% .. of have I misunderstood?

Not 100% sure what you mean - but if you mean cash ISAs - they are guaranteed to make what they say until they change the rate and it will all be based around the BOE base rate. Anything is stocks and bons funds/ individual investments is purely speculative - you will make more over the long-term but you could lose a lot in the short term.

 

[harpo_72]

Not 100% sure what you mean - but if you mean cash ISAs - they are guaranteed to make what they say until they change the rate and it will all be based around the BOE base rate. Anything is stocks and bons funds/ individual investments is purely speculative - you will make more over the long-term but you could lose a lot in the short term.

I am disappointed that no one’s turning around and saying 4.5% per annum is rubbish with healthy management you can get to far higher figures ..
I am just skimming mine and making it useful, as in if it does drop the profit has already gone into my pocket .. it will drop but best not let all of it devalue.

 

[The Squirrel]

I am disappointed that no one’s turning around and saying 4.5% per annum is rubbish with healthy management you can get to far higher figures ..
I am just skimming mine and making it useful, as in if it does drop the profit has already gone into my pocket .. it will drop but best not let all of it devalue.

Of course you can average better than 4.5% over the long term with half decent investment. But you're comparing apples with oranges.

Nobody is suggesting cash is the best option for long-term strategic investment - money you won't need for a few years.

Some situations do require zero risk though. For example if you have £20k of savings with no other reserves and have a known essential bill (e.g. tax) falling due next year for £20k then you absolutely cannot take a risk investing, suffering a loss and not being able to meet that bill, but you might as well get all the interest you can, rather than pay the bill today - the best available cash interest rate is exactly what you should be after.

Cash ISAs and S&S ISAs are completely different tools to do completely different jobs. They just both come with some tax sheltering properties so are called ISAs.

 

[harpo_72]

Of course you can average better than 4.5% over the long term with half decent investment. But you're comparing apples with oranges.

Nobody is suggesting cash is the best option for long-term strategic investment - money you won't need for a few years.

Some situations do require zero risk though. For example if you have £20k of savings with no other reserves and have a known essential bill (e.g. tax) falling due next year for £20k then you absolutely cannot take a risk investing, suffering a loss and not being able to meet that bill, but you might as well get all the interest you can, rather than pay the bill today - the best available cash interest rate is exactly what you should be after.

Cash ISAs and S&S ISAs are completely different tools to do completely different jobs. They just both come with some tax sheltering properties so are called ISAs.

That’s an interesting point , when it comes to tax, I am not sure there is any point in seeking any growth because that is taxed as well .. and I don’t think current rates of interest even merit the effort to look. Plus you have to hold the cash in for a fixed period of time in most cases to get the best rates.
I am not even sure it’s worth piling money into an S&S ISA currently given the growth .. will the weekends activity cause a market downturn ( note he announced and conducted operations after the Markets closed - would be interested to see if his investing activity on Friday was a case of getting current gains out!)

 

[The Squirrel]

That’s an interesting point , when it comes to tax, I am not sure there is any point in seeking any growth because that is taxed as well .. and I don’t think current rates of interest even merit the effort to look. Plus you have to hold the cash in for a fixed period of time in most cases to get the best rates.
I am not even sure it’s worth piling money into an S&S ISA currently given the growth .. will the weekends activity cause a market downturn ( note he announced and conducted operations after the Markets closed - would be interested to see if his investing activity on Friday was a case of getting current gains out!)

If it’s in an ISA it won’t be taxed of course; that’s the whole point of an ISA!
Of course it’s worth it . Internet exists. Takes 10 minutes to open a savings account now.

Take the 20K example above; you can get 4% with no tie ins; Your options are:

Pay large bill early, now; net result +£0
Pay large bill next year; 4% interest in ISA in meantime; Net result +£800
Pay large bill next year; 4% interest in meantime but then lose some of that to tax. Net result depends on your tax rate but still +several £100s in your pocket.

Up to £800 for 10 minutes work. I’d take it.

 

[Fade and Die]

That’s an interesting point , when it comes to tax, I am not sure there is any point in seeking any growth because that is taxed as well .. and I don’t think current rates of interest even merit the effort to look. Plus you have to hold the cash in for a fixed period of time in most cases to get the best rates.
I am not even sure it’s worth piling money into an S&S ISA currently given the growth .. will the weekends activity cause a market downturn ( note he announced and conducted operations after the Markets closed - would be interested to see if his investing activity on Friday was a case of getting current gains out!)

What do you mean here? S&S ISAs have been performing great over the last 12 months. Even after the big tariff dip they rallied back quickly. This latest thing in the Middle East will certainly cause a dip but once resolved they will rally again.

 

[harpo_72]

What do you mean here? S&S ISAs have been performing great over the last 12 months. Even after the big tariff dip they rallied back quickly. This latest thing in the Middle East will certainly cause a dip but once resolved they will rally again.

Yup they have performed brilliantly.. but the markets are very volatile especially when change happens .. they will recover but how far they drop will be interesting

 

[Fade and Die]

Yup they have performed brilliantly.. but the markets are very volatile especially when change happens .. they will recover but how far they drop will be interesting

Buy the dip. Best time to get into a new market… the only way is up!

 

[harpo_72]

If it’s in an ISA it won’t be taxed of course; that’s the whole point of an ISA!
Of course it’s worth it . Internet exists. Takes 10 minutes to open a savings account now.

Take the 20K example above; you can get 4% with no tie ins; Your options are:

Pay large bill early, now; net result +£0
Pay large bill next year; 4% interest in ISA in meantime; Net result +£800
Pay large bill next year; 4% interest in meantime but then lose some of that to tax. Net result depends on your tax rate but still +several £100s in your pocket.

Up to £800 for 10 minutes work. I’d take it.

This was my initial thought but when you dig deeper the account requirements are pretty demanding and costly .. so the £800 gets reduced significantly.
I didn’t want to change all of our business accounts or open up 2 more and create more complexity with fixed amounts being shuffled around .. the accounts would just become more time consuming and more costly.

 

[harpo_72]

Buy the dip. Best time to get into a new market… the only way is up!

That’s what I am thinking I may do

 

[Fade and Die]

That’s what I am thinking I may do

Me too, only Crypto!

 

[harpo_72]

Me too, only Crypto!

Brave .. !!