Stockmarket, pension funds and perspective
Discussion
About a year ago I chose to invest in a pension policy - after many years of being rather 'anti-pension', on the basis that I didn't like the idea of someone else controlling my cash. Anyway, I could no longer ignore the Tax breaks, plus I have other investments as well. As such, in the last year I put the maximum amount possible into a 'medium-low risk' pension fund.
Today, with much trembling and trepidation, I decided to torture myself by seeing how my investment was maturing (or other). Anyhow, it seems the value of my investment has fallen by some 17% over the year. Now I'm not too upset about this because had I have paid myself the same amount and invested in property or saving accounts (or whatever) I would have had to pay 40% income Tax + NI and the monies would have reduced by (circa) 50%. My point is, that while everyone is moaning that stock-markets have gone mental (and they have) I'm still 23% better off than if HMRC had got their grubby paws on it. As such, it ain't all bad news when you put it into perspective. Also, looking at it in the long term the pension will eventually increase. Someone described that investing in shares should be like a long-haul flight, in that you don't bail out when you hit some turbulence.
Here endeth my lesson for the day!
Today, with much trembling and trepidation, I decided to torture myself by seeing how my investment was maturing (or other). Anyhow, it seems the value of my investment has fallen by some 17% over the year. Now I'm not too upset about this because had I have paid myself the same amount and invested in property or saving accounts (or whatever) I would have had to pay 40% income Tax + NI and the monies would have reduced by (circa) 50%. My point is, that while everyone is moaning that stock-markets have gone mental (and they have) I'm still 23% better off than if HMRC had got their grubby paws on it. As such, it ain't all bad news when you put it into perspective. Also, looking at it in the long term the pension will eventually increase. Someone described that investing in shares should be like a long-haul flight, in that you don't bail out when you hit some turbulence.
Here endeth my lesson for the day!
Edited by srebbe64 on Tuesday 7th October 18:54
shadowninja said:
Those fund managers are good, aren't they!
One of my neighbours is a fund manager and I keep ribbing him mercilessly. Basically, when he has a good year, and he gets his nice bonus, he says it's due to his quick wittedness and shrewd investment nouse. When he has a bad year (like this one) it's due to 'the markets'. My point is, he can't have it both ways!Gassing Station | The Pie & Piston Archive | Top of Page | What's New | My Stuff