Pension

[Matt]

Had a pensions advisor come into work today, I have been thinking about my pension for a while now, ever since I started work, Because the retirement age is just gonna get older and tbh when it comes to the time for me to retire they probably won't even be a state pension, I have been just putting so much of my earning into a savings account at the moment, and when/if I start a pension I will just use some of that.

I dunno whether to open this pension scheme that i've been offered which offers 22% added to whatever you put into it (i.e Put 78 pounds in they'll make it up to 100 pounds) [but when you want to use the money they'll take that back]

OR

Just save myself (With the risk of occasionally dipping into the money - Not a good idea)

OR

Invest in property, TBH i'd like a place of my own now, but i've got it too good at home, someone has suggest just buy a place but rent it out, and let the rent pay the mortgage.

I dunno

Whats everyone else got in place as a pension?

[holly]

Had a pensions advisor come into work today, I have been thinking about my pension for a while now, ever since I started work, Because the retirement age is just gonna get older and tbh when it comes to the time for me to retire they probably won't even be a state pension, I have been just putting so much of my earning into a savings account at the moment, and when/if I start a pension I will just use some of that.

I dunno whether to open this pension scheme that i've been offered which offers 22% added to whatever you put into it (i.e Put 78 pounds in they'll make it up to 100 pounds) [but when you want to use the money they'll take that back]

OR

Just save myself (With the risk of occasionally dipping into the money - Not a good idea)

OR

Invest in property, TBH i'd like a place of my own now, but i've got it too good at home, someone has suggest just buy a place but rent it out, and let the rent pay the mortgage.

I dunno

Whats everyone else got in place as a pension?

my mum and dad have told me not to bother with ever getting one, yeh i`m still only @ uni but they reckon it wont be worth it by the time we are old enough to get them

[Steven]

Whats everyone else got in place as a pension?

My savings and investments.

[Webbo]

i took out my pension when i was 30(12 years ago). my accountant tried to talk me out of it. according to the forcasts by the time i retire i'll be about a fiver a week better off than the people who piss all their money up the wall.

[Matt]

my mum and dad have told me not to bother with ever getting one, yeh i`m still only @ uni but they reckon it wont be worth it by the time we are old enough to get them

True which is why i'm wondering. In my eyes they seem quite risky.

But at the same time so does me just putting money into a savings account because it's too easy for me to get my hands on.

As I said I would like my own property, e.t.c, but not sure if the time is "right" yet, plus I don't know if I will be staying in England or not in the future, although on the other hand, If I don't stay in England atleast I always have something in England to come back to and then on the other hand, I may need to get rid of the property here to fund my future elsewhere.

So i'm confused!

[holly]

True which is why i'm wondering. In my eyes they seem quite risky.

But at the same time so does me just putting money into a savings account because it's too easy for me to get my hands on.

As I said I would like my own property, e.t.c, but not sure if the time is "right" yet, plus I don't know if I will be staying in England or not in the future, although on the other hand, If I don't stay in England atleast I always have something in England to come back to and then on the other hand, I may need to get rid of the property here to fund my future elsewhere.

So i'm confused!

put something on it that makes it inaccesable to ya until ur however old

[Rincewind]

I was in a pension scheme at my place of work a few years ago. I worked out that I needed to save 4 times more than I could afford to to make it worthwhile when I'm 65 This would have been about a quarter of my take-home pay at the time, What with rent and other bills taking up most of the rest I would be left little for a social life and holidays so I said bugger it and froze the payments. TBH I don't think I'll starve when I finish work. I can live cheaply and there are plenty of places and organisations that help OAPs. Free or discount dinners soup kitchens, free transport, free rent free TV license cut price rates electricity, gas , special outings laid on and best of all consession rates down the football.

[Head Honcho]

Pensions are great but you can't beat property.

If you can't afford anything here buy abroad, prices in Poland and Hungary and other parts of East Europe are about to rocket so be quick.

Turkey and Portugal are still good for buy to let, especially resorts near Golf courses.

Further afield there are loads of new developments in Egypt

[cisono]

My savings and investments.

That's the way to go...

[Wils]

My Dads a Pension Advisor he can sort mine out

[cisono]

Pensions are great but you can't beat property.

If you can't afford anything here buy abroad, prices in Poland and Hungary and other parts of East Europe are about to rocket so be quick.

Turkey and Portugal are still good for buy to let, especially resorts near Golf courses.

Further afield there are loads of new developments in Egypt

You I just need some money to buy these properties with

[The People's Hero]

I think you'd be extremely lucky to get a buy-to-let mortgage anyway mate. Don't want to put a downer on it from that perspective but generally speaking they want to see you put down a large deposit or at least have some substantial collateral behind it. That is unless you're pulling down a substantial salary?

As far as pensions go... your calculations are a bit flawed I believe. £78 + 22% is not £100 mate...

Also, a 22% contribution of what you're contributing yourself doesn't sound very impressive to me... I wouldn't consider it worthwhile.

One thing to bear in mind though is that any pension contibution is taken from your salary before tax is charged. That is to say, contributing to your own pension is a good 'tax break' - if you're looking for one

[The People's Hero]

my mum and dad have told me not to bother with ever getting one, yeh i`m still only @ uni but they reckon it wont be worth it by the time we are old enough to get them

I think this needs to be qualified a little.

It is impossible to say what the situation will be regarding state pensions, their availability and value for 50 years time. Having said that, it's always wise to work on a worst case scenario. So let's assume there is no provision for state pension when us 20somethings retire.

I still believe there is value in having a private, personal pension plan through a bank or similar.

[Geo V]

Pensions are great but you can't beat property.

If you can't afford anything here buy abroad, prices in Poland and Hungary and other parts of East Europe are about to rocket so be quick.

Turkey and Portugal are still good for buy to let, especially resorts near Golf courses.

Further afield there are loads of new developments in Egypt

Great advice there as you took the words out of my mouth. Although pensions are pretty secure they have been known to go wrong. Its all about property!

One thing I would suggest if buying property is to look in places like Newcastle and Liverpool where they will no doubt be subject of regeneration in future years. You can get some real cheap places up there and the footy is decentquality too .

My best advice is to by property in Northern Cyprus. I wont bore you with the politics but Northern Cyprus is at the moment not legally recognised and you cant get a direct flight there and sanctions against them are all over the place with most of the world. However, the Cyprus problem which has been going on for 30 years will be resolved whether its next year or in 10 years and the beautiful land that is available on that side of the island is dirt cheap. Im Greek Cypriot but even I`ll admit that we have got some great spots in the South but parts of the North (NE in particular) are amazing. If I didnt have a Greek surname I would have bought some land! To all the English guys and girls go fill your boots as you`ll make shite loads of money!!

[Dr The Singh]

Great advice there as you took the words out of my mouth. Although pensions are pretty secure they have been known to go wrong. Its all about property!

One thing I would suggest if buying property is to look in places like Newcastle and Liverpool where they will no doubt be subject of regeneration in future years. You can get some real cheap places up there and the footy is decentquality too .

My best advice is to by property in Northern Cyprus. I wont bore you with the politics but Northern Cyprus is at the moment not legally recognised and you cant get a direct flight there and sanctions against them are all over the place with most of the world. However, the Cyprus problem which has been going on for 30 years will be resolved whether its next year or in 10 years and the beautiful land that is available on that side of the island is dirt cheap. Im Greek Cypriot but even I`ll admit that we have got some great spots in the South but parts of the North (NE in particular) are amazing. If I didnt have a Greek surname I would have bought some land! To all the English guys and girls go fill your boots as you`ll make shite loads of money!!

I dunno, apexgeo, my line manager is turk cypriot and my MD is greek cypriot, non have invested in Cyprus, infact they have invested in Spain, Bulgaria, Florida. Maybe they are not as confident as you in the Cypriot market but I have to agree my line manager does say that northern cyprus is untouched and has alot potential!!!

[Geo V]

I dunno, apexgeo, my line manager is turk cypriot and my MD is greek cypriot, non have invested in Cyprus, infact they have invested in Spain, Bulgaria, Florida. Maybe they are not as confident as you in the Cypriot market but I have to agree my line manager does say that northern cyprus is untouched and has alot potential!!!

Its low risk land more than anything mate. Its all about the land in the North mate and trust me on this, I am killing myself saying that as Northern Cyprus should be ours too! The price of land will shoot up once the illegal state is recognised and despite the Greek side being upset over the issues, its only a matter of time before NC is recognised, let in the EU and then an explosion of investment will follow and land will be worth plenty. 10/15 years ago the southern part of Cyprus was unrecognisable to now after all the western investment and I reckon the North will go the same way within 5-10 years.

[Monk]

Its low risk land more than anything mate. Its all about the land in the North mate and trust me on this, I am killing myself saying that as Northern Cyprus should be ours too! The price of land will shoot up once the illegal state is recognised and despite the Greek side being upset over the issues, its only a matter of time before NC is recognised, let in the EU and then an explosion of investment will follow and land will be worth plenty. 10/15 years ago the southern part of Cyprus was unrecognisable to now after all the western investment and I reckon the North will go the same way within 5-10 years.

Can we just clarify something - no short term "high return" investment is low risk (I can justify this if you want but it will involve some economic theory...). If you are going for a pension you need a balance of high risk and low risk investments. That might mean property, but also split your investment over Trackers, small cap and large cap investments, bonds and emerging markets.

The Motley Fool website gives loads of good advice on this - but it seems setting up a SIPP scheme is the way forward.

The stock exchange offers average returns of 10% so even if you tracked that alone, a £100 per month investment over 35 years amounts to £380,000 or > £600,000 over 40 years.

Property is high risk as you are funding a large purchase with debt, this will wipe out some of your returns. If you want to track the property market, then buy shares in property sector companies.

You shouldnt rely on emerging market property funded by debt for your pension, it is too risky, and it is illiquid. I.e. if there is ever financial crisis such as war, then you are more likely to be able to sell shares and bonds than property.

Thats my 2 cents

[Geo V]

Can we just clarify something - no short term "high return" investment is low risk (I can justify this if you want but it will involve some economic theory...). If you are going for a pension you need a balance of high risk and low risk investments. That might mean property, but also split your investment over Trackers, small cap and large cap investments, bonds and emerging markets.

The Motley Fool website gives loads of good advice on this - but it seems setting up a SIPP scheme is the way forward.

The stock exchange offers average returns of 10% so even if you tracked that alone, a £100 per month investment over 35 years amounts to £380,000 or > £600,000 over 40 years.

Property is high risk as you are funding a large purchase with debt, this will wipe out some of your returns. If you want to track the property market, then buy shares in property sector companies.

You shouldnt rely on emerging market property funded by debt for your pension, it is too risky, and it is illiquid. I.e. if there is ever financial crisis such as war, then you are more likely to be able to sell shares and bonds than property.

Thats my 2 cents

Thats way too intelligent for this thread mate

I agree with a lot of the above but IMO bricks and mortar and land is a safer bet, especially as you can reap the rewards from it quite early in your life and plough that into further investment. Infact if you make the correct investments can enjoy some of the profit.

I am surrounded by family members who have been dealing in property for years and have heeded there advice as its much better to see your money in something as aposed to waiting for someone to ring you up 20 years later to say that someone has spent your future.

I wouldnt throw all my eggs in the same basket either when it comes to investing in property and I certainly wouldnt encourage people to re-mortgage the house to buy something that may be out of reach but there is still opportunities out there, even in the UK, to buy something and make a killing to allow some of us people to be able to buy an executive box at out 150,000 stadium in 2037

[Head Honcho]

Can we just clarify something - no short term "high return" investment is low risk (I can justify this if you want but it will involve some economic theory...). If you are going for a pension you need a balance of high risk and low risk investments. That might mean property, but also split your investment over Trackers, small cap and large cap investments, bonds and emerging markets.

The Motley Fool website gives loads of good advice on this - but it seems setting up a SIPP scheme is the way forward.

The stock exchange offers average returns of 10% so even if you tracked that alone, a £100 per month investment over 35 years amounts to £380,000 or > £600,000 over 40 years.

Property is high risk as you are funding a large purchase with debt, this will wipe out some of your returns. If you want to track the property market, then buy shares in property sector companies.

You shouldnt rely on emerging market property funded by debt for your pension, it is too risky, and it is illiquid. I.e. if there is ever financial crisis such as war, then you are more likely to be able to sell shares and bonds than property.

Thats my 2 cents

Great advice and a war is always going to put the cat amongst the pigeons but thats the risk you take.

I always feel that if the country has a lot of foreign investment and the economy is pretty stable then you're pretty much safe but as you say there is no such thing as no risk!

I've been thinking for some time now about investing in Florida but after seeing that hurricane rip through central Florida at the weekend it seems unlikely now(not sure if you'd get adequate insurance or for that matter insurance at all) May look at Costa Rica and Mumbai now.

[James.]

Can we just clarify something - no short term "high return" investment is low risk (I can justify this if you want but it will involve some economic theory...). If you are going for a pension you need a balance of high risk and low risk investments. That might mean property, but also split your investment over Trackers, small cap and large cap investments, bonds and emerging markets.

The Motley Fool website gives loads of good advice on this - but it seems setting up a SIPP scheme is the way forward.

The stock exchange offers average returns of 10% so even if you tracked that alone, a £100 per month investment over 35 years amounts to £380,000 or > £600,000 over 40 years.

Property is high risk as you are funding a large purchase with debt, this will wipe out some of your returns. If you want to track the property market, then buy shares in property sector companies.

You shouldnt rely on emerging market property funded by debt for your pension, it is too risky, and it is illiquid. I.e. if there is ever financial crisis such as war, then you are more likely to be able to sell shares and bonds than property.

Thats my 2 cents

All good advice.

Couple of things to add:

1. You will gain more leverage from your investment if you invest in property relative to property company shares (the correlation between property market shares and the property market is not as high as direct investments in property itself). Rturns on property will generally be higher than that of the shares. Obviously with this is the illiquidity and higher risk that monk mentioned.

2. Invest in funds (directly or through an ISA). Here you can have relatively low risk (in the current stable environment) trackers that follow the FTSE 100 or higher risk emerging market trackers like China/India Growth Funds, which in my opinion offer excellent potential.

[Monk]

All good advice.

Couple of things to add:

1. You will gain more leverage from your investment if you invest in property relative to property company shares (the correlation between property market shares and the property market is not as high as direct investments in property itself). Rturns on property will generally be higher than that of the shares. Obviously with this is the illiquidity and higher risk that monk mentioned.

2. Invest in funds (directly or through an ISA). Here you can have relatively low risk (in the current stable environment) trackers that follow the FTSE 100 or higher risk emerging market trackers like China/India Growth Funds, which in my opinion offer excellent potential.

See how we singlehandedly upped the quality of the conversation...

[Steven]

Chance for me lower it again then. I would suggest that you look at Commodities. Anything that might be needed to continue the growth in China and that projected for India.

Anything "Green". Technologies and fuels. Buy long dated Corn Futures.

I look to get as close to my target return as possible and then buy some sort of derivative for example to give me that little bit extra.

I would suggest that you look at your own investment profile and make sure that what you hold as investments matches your aspirations.

Whilst it is not a full time job you do need to know where you stand financially at all times.

[Matt]

I think you'd be extremely lucky to get a buy-to-let mortgage anyway mate. Don't want to put a downer on it from that perspective but generally speaking they want to see you put down a large deposit or at least have some substantial collateral behind it. That is unless you're pulling down a substantial salary?

As far as pensions go... your calculations are a bit flawed I believe. £78 + 22% is not £100 mate...

Also, a 22% contribution of what you're contributing yourself doesn't sound very impressive to me... I wouldn't consider it worthwhile.

One thing to bear in mind though is that any pension contibution is taken from your salary before tax is charged. That is to say, contributing to your own pension is a good 'tax break' - if you're looking for one

Not bad. Now i'm qualified I have had a fairly big pay-rise and I am just under the wage which 2/3 people at work have just bought a house (The only advantage for them is that they are mid to late 20's...I.e They may not be so keen giving me a mortgage looking at my age even though I earn almost as much/the same)

TBH Property, Mixed with savings is the best option I think. I've booked to see a Money/Pensions advisor on Friday to discuss anyway.

[James.]

Chance for me lower it again then. I would suggest that you look at Commodities. Anything that might be needed to continue the growth in China and that projected for India.

Anything "Green". Technologies and fuels. Buy long dated Corn Futures.

I look to get as close to my target return as possible and then buy some sort of derivative for example to give me that little bit extra.

I would suggest that you look at your own investment profile and make sure that what you hold as investments matches your aspirations.

Whilst it is not a full time job you do need to know where you stand financially at all times.

I'd agree about commodities but on the whole I doubt your recommendations would be viable unless you have a large amount of capital. Transaction costs will lower your return, particularly with futures and other derivatives.

Also fuel is one of the most volatile commodities and oil companies have some of the most volatile share prices.

As you say though India and China are excellent opportunities.

[Geo V]

Great advice and a war is always going to put the cat amongst the pigeons but thats the risk you take.

I always feel that if the country has a lot of foreign investment and the economy is pretty stable then you're pretty much safe but as you say there is no such thing as no risk!

I've been thinking for some time now about investing in Florida but after seeing that hurricane rip through central Florida at the weekend it seems unlikely now(not sure if you'd get adequate insurance or for that matter insurance at all) May look at Costa Rica and Mumbai now.

Land in souther Cyprus 10 years ago was cheap and we saw the Brits coming and bought loads of land and family and friends made a killing from it. I expect the same of Northern Cyprus despit ethe political unrest because I have seen Greeks driving into the North for all sorts for visiting "there former homes" to visiting the casino. Kofe Anan tried to get the south to agree with his terms which would eventially allow the northern part to be recognised but it failed. However, barriers between the two continue to break down and to speak footy for a sec, Olympiakos (greek side), now have a Turkish player in there team which would never have happened 15 years ago. they even gave them points in the eurovision ! Its only a matter of time before the untouched land of Northern Cyprus is worth mega money IMO. I just need to change my surname to Mehmet and I`ll be buying half the Island