pension uncertainty

[Blackpuddin]

What's the feeling re pension pots at the moment? My latest Standard Life SIPP statement has given me the glad tidings of a reduction in value over the last year. Given that I'm also paying them 0.7% of the value every year, the mattress is starting to look attractive. I have no knowledge or interest in pensions other than the basic one of not wanting to watch it disappear like snow on a warm day.

[trickywoo]

In the long run it'll be better off where it is than under the mattress or in an ordinary bank account.

Apart from making sure its not mismanaged the best thing to do is not worry about fluctuations.

Unless the capitalist system fails its going to be worth more in the long run than you've put in.

I'd only worry if you needed to cash it in within the next five years.

I know jack however, having moved my cash ISA into stocks and shares last summer - ouch.

[Blackpuddin]

Thanks for the advice. I certainly wouldn't be having a flutter in the stock market casino so I guess I've got no option other than to try and winkle the wonga out of them without bequeathing a fortune to HMRC, which may be impossible, and then blow the lot on a couple of (hopefully appreciating) classic cars.

[coetzeeh]

Hang in there, what goes down must go up . I'm in a similar boat.

[Blackpuddin]

coetzeeh said:

Hang in there, what goes down must go up . I'm in a similar boat.

Must it though? I should never have watched X Files last night. As part of the new world order Mulder was predicting the instant disappearance of all digital money.

[rotarymazda]

Blackpuddin said:

What's the feeling re pension pots at the moment? My latest Standard Life SIPP statement has given me the glad tidings of a reduction in value over the last year. Given that I'm also paying them 0.7% of the value every year, the mattress is starting to look attractive. I have no knowledge or interest in pensions other than the basic one of not wanting to watch it disappear like snow on a warm day.

If you are keeping it in cash form, just move it to a different SIPP provider with lower platform charge. If you have a good fund size, get one with a fixed £ vale rather than % based. I was with Standard Life for a few years due to being in a works pension but the charges are excessive if you just want to keep it as cash.

I use Hargreaves Lansdown, cost is £200/yr. Buying unit trusts is expensive but shares and investment trusts don't result in extra charges so I just do that, keeping the rest in cash. They will pay a small % in interest if you just want to keep cash.

There are many other providers, the Telegraph did a SIPP comparison table recently that you can search for.

[oldaudi]

Blackpuddin said:

Must it though? I should never have watched X Files last night. As part of the new world order Mulder was predicting the instant disappearance of all digital money.

Well yes the entire banking system is one hack away from being taken down. Fractional reserve banking, a run on the banks, governments freezing withdraws any of that could make you lose your "money" over night.

But its also the same system they use themselves and this fiat currency lark is all a farce anyway once it stopped being backed by anything.

But in answer to the original question, the financial markets go in cycles so just sit, watch and dont panic. I suggest you dont head over to zerohedge.com to see whats really happening

[emicen]

I started a thread last week regarding my pension having noted the same thing.

Previous years' growth was double digit percentage, this year's to date is in the region of -3.7% [and at the time I started the thread was only -0.8%!]

Conclusion I have come to is most funds are battling with the volatile markets and rather than jumping ship I'm continuing to pay in, buying more reduced price stake in the funds whilst the price is depressed and given time, it will rise again.

Yes I've looked at other funds available within the plan and may diverge some money in to them, but when I compare it to my own share dabblings/investments, in the period 1st Oct to today;
- the funds in my pension are -0.75% and -0.04% respectively
- my own investments have peaked at +17% but currently are sitting at just shy of -24%
- the FTSE100 as a whole is somewhere in between

I've decided to leave them to it I'm still up courtesy of employer contributions and tax relief.

[SunsetZed]

Also if you're a long way off taking it then it can be seen as good that the prices are lower as you get more units per £ and therefore more potential for increase in the future.

[Blackpuddin]

From what I can understand of this paperwork 53.9% of my pension funds are in a SL SIPP bank account, the rest is in three SL investment policy funds (Mixed Bond, Multi-Asset Management and Annuity Purchase). If that means anything to anyone.

[Ozzie Osmond]

Blackpuddin said:

53.9% of my pension funds are in a SL SIPP bank account

...then do something about it, because that's almost certainly going backwards relative to inflation.

[Blackpuddin]

Ozzie Osmond said:

Blackpuddin said:

53.9% of my pension funds are in a SL SIPP bank account

...then do something about it, because that's almost certainly going backwards relative to inflation.

Thank you. I'm not sure how it ended up like that. In the last consultation I had with the adviser we agreed on 50% in the bank and the other 50% managed funds.
What would the PH view be on a reasonable %age to have in the bank? Of course, no blame or indeed profit share will accrue to the PH adviser.

[emicen]

Blackpuddin said:

Thank you. I'm not sure how it ended up like that. In the last consultation I had with the adviser we agreed on 50% in the bank and the other 50% managed funds.
What would the PH view be on a reasonable %age to have in the bank? Of course, no blame or indeed profit share will accrue to the PH adviser.

I'm nothing like an expert but personally, I consider cash to be the last thing you put in your pension pot, as in, the last 5 years or so. You get the tax relief on the money paid in but cash funds typically return very low growth in pensions.

Say you're a higher rate tax payer in your 30s, you get 40% boost to the cash via tax relief and then relatively buttons for the next let's say 30 years. 40% growth over 30 years is 1.13% annual growth. However, if you leave it till your final 5 years of contributions, that's the equivalent of 6.96% annual growth and even more as you move closer to retirement. As long as it's kept spread between institutions to keep all sums within the compensation limits its a very safe way to get a guaranteed return.

[GT03ROB]

Blackpuddin said:

Thank you. I'm not sure how it ended up like that. In the last consultation I had with the adviser we agreed on 50% in the bank and the other 50% managed funds.
What would the PH view be on a reasonable %age to have in the bank? Of course, no blame or indeed profit share will accrue to the PH adviser.

How old are you?

25 - 0%
65 - a heck of a lot more!!

[Blackpuddin]

GT03ROB said:

Blackpuddin said:

Thank you. I'm not sure how it ended up like that. In the last consultation I had with the adviser we agreed on 50% in the bank and the other 50% managed funds.
What would the PH view be on a reasonable %age to have in the bank? Of course, no blame or indeed profit share will accrue to the PH adviser.

How old are you?

25 - 0%
65 - a heck of a lot more!!

Sorry for the delay in replying, we've been trying to find a pub serving food. Anyway, the answer is I'm 61 but still working, albeit as the director (and only worker ) of a limited company. Stopped paying into the pension (a benefit of previous employment) many years ago.