Pensions

[Jwoodgardenmaintenance]

So all in all is a pention worth while or should I save say £200 a month and just put it into a savings account and just let the interest ect take its toll and when I come to the age of retiring just withdraw so much each week been looking at equity isa and they seem really complicated unless someone can explain them simply? 

[spudulike]

33 minutes ago, Jwoodgardenmaintenance said:

So all in all is a pention worth while or should I save say £200 a month and just put it into a savings account and just let the interest ect take its toll and when I come to the age of retiring just withdraw so much each week been looking at equity isa and they seem really complicated unless someone can explain them simply? 

Equity ISAs are pretty simple, you are basically buying shares in a fund that normally consists of lots of shares in a number of companies.

You can invest lump sums or make regular savings and there are minimum and maximum amounts you can invest in during a given year.

You take your hard earned and invest it, the fund you have invested in should grow over the many years you save for and you can draw your money out and pay no tax on any gains you have made. They tend to be a bit more "interesting" than the more safe pension funds.

Personally I would avoid the banks etc and just look at different funds from the big investment companies, Schroeder, Bailey Gifford, Jupiter, JP Morgan etc. 

They are a bit like a fancy bank account with the main difference being that your fund can plummet if the markets are volatile but they can also make 30% in a good year but nothing is guaranteed and much depends on your investment strategy. Take more risk when young and less when older is the norm!

You can instruct your investor to switch funds or pull out funds at any time. 

Lots online about them and they are a sound long term investment.

Do Not Leave it in a Savings Account!!!!!!

Edited January 11, 2019 by spudulike

[Jwoodgardenmaintenance]

1 minute ago, spudulike said:

Equity ISAs are pretty simple, you are basically buying shares in a fund that normally consists of lots of shares in a number of companies.

You can invest lump sums or make regular savings and there are minimum and maximum amounts you can invest in during a given year.

You take your hard earned and invest it, the fund you have invested in should grow over the many years you save for and you can draw your money out and pay no tax on any gains you have made. They tend to be a bit more "interesting" than the more safe pension funds.

Personally I would avoid the banks etc and just look at different funds from the big investment companies, Schroeder, Bailey Gifford, Jupiter, JP Morgan etc. 

They are a bit like a fancy bank account with the main difference being that your fund can plummet if the markets are volatile but they can also make 30% in a good year but nothing is guaranteed and much depends on your investment strategy. Take more risk when young and less when older is the norm!

You can instruct your investor to switch funds or pull out funds at any time. 

Lots online about them and they are a sound long term investment.

Cheers spud that's a lot less complicated than what I was reading yesterday just want to invest my money wisely and be able to gain with the money I dont see or use 30% sounds good to me I think a few phonecalls are on the list to be done 

[openspaceman]

25 minutes ago, Jwoodgardenmaintenance said:

So all in all is a pention worth while or should I save say £200 a month and just put it into a savings account and just let the interest ect take its toll and when I come to the age of retiring just withdraw so much each week been looking at equity isa and they seem really complicated unless someone can explain them simply? 

It's up to you to make a decision, or perhaps a little bit of both.

 

Savings: You save from income, if you are a tax payer you have already paid tax but you must pay tax on interest income your savings earn. You can take and spend it as you please at any time.

 

Pension: You save from income but before it is taxed, it is likely to earn more interest, which is ploughed back into the fund, as it is invested into a spread of different investments. It's generally untouchable till you reach 55 years old, you need do nothing till 75 years old.. You can then cash in up to 25% of the pension fund and do what you like with it. You can take the rest but will have to pay interest on anything  that this adds to your income over £11080. If it is a large fund you will be taxed at the higher rate if it takes your income above that threshold. You can buy an annuity with the balance of the fund but it will still be taxed if your income is over the threshold .

[Jwoodgardenmaintenance]

10 minutes ago, openspaceman said:

It's up to you to make a decision, or perhaps a little bit of both.

 

Savings: You save from income, if you are a tax payer you have already paid tax but you must pay tax on interest income your savings earn. You can take and spend it as you please at any time.

 

Pension: You save from income but before it is taxed, it is likely to earn more interest, which is ploughed back into the fund, as it is invested into a spread of different investments. It's generally untouchable till you reach 55 years old, you need do nothing till 75 years old.. You can then cash in up to 25% of the pension fund and do what you like with it. You can take the rest but will have to pay interest on anything  that this adds to your income over £11080. If it is a large fund you will be taxed at the higher rate if it takes your income above that threshold. You can buy an annuity with the balance of the fund but it will still be taxed if your income is over the threshold .

Cheers for the info appreciate it 

[scbk]

When's retirement age? I know self employed guys in their 70s/80s. One guy is 90 this spring and still working.

[Jwoodgardenmaintenance]

11 minutes ago, scbk said:

When's retirement age? I know self employed guys in their 70s/80s. One guy is 90 this spring and still working.

I'm wanting to retire about 55 I'm sure it's about 68-70 when state pention kicks in though I'm not 100% 

[Squaredy]

9 hours ago, scbk said:

When's retirement age? I know self employed guys in their 70s/80s. One guy is 90 this spring and still working.

You can retire whenever you wish, but state pension kicks in around 67 to 70 (depending on DOB).  And you can indeed start taking your state pension and still work.  Or indeed start taking a private pension and still work.  

 

If you delay your state pension it will be increased - not just by the amount all state pensions are increased yearly but enhanced above that by a fairly generous amount for each year you delay.  Ideal for someone who is fit and well and really does not want to stop work just because they have reached the age they can take their state pension.

[spudulike]

9 hours ago, openspaceman said:

Savings: You save from income, if you are a tax payer you have already paid tax but you must pay tax on interest income your savings earn. You can take and spend it as you please at any time.

No you don't, if you put a grand in to an Equity ISA and after 30 years it is worth £12K, you take out £12k and don't pay a penny in capital gains tax. You don't get tax relief on your pay as with a pension but an ISA is a tax free saving!!!

Just don't confuse equity with a cash ISA.

[Stephen Blair]

Thanks Squaredy, you know your stuff.

I am having a meeting with my guy in the next month I’ll pat attention this time ?