How much do you put in your pension?

[Fred Bloggs]

Not if it is a new bull market.

Yes, they have gone up 100% this year but that was off very deep multi-year lows. This chart shows just how low the miners went relative to Gold.

HUI to Gold Ratio | MacroTrends

100% is nothing in a PM bull market.

Of course, it might not be a new bull market. Only time will tell.

I don't buy the new bull market theory I'm afraid. We're in for a very volatile period now for the next couple of years while the UK/EU unwinds. The could be supportive for gold and miners. But the wider global economy is not looking so healthy which is obviously negative. If I'd made 100% on miners, I'd pull out my stake money and then ride the roller coaster with free money.

[kaiser78]

I believe a very good bet is Fundsmith, it has a large proportion of US assets and the British companies held earn a lot of their revenue overseas. I have bought more last Friday and I suspect I may be buying again too.

I moved most of my equities into Fundsmith last week in advance of the ref result, and whilst the market now re-stabilises will hold in there.

[Fred Bloggs]

I moved most of my equities into Fundsmith last week in advance of the ref result, and whilst the market now re-stabilises will hold in there.

Good plan. Maybe I should have done the same. I'm about 25% cash in my SIPP at the moment.

[DonkeyRhubarb]

I don't buy the new bull market theory I'm afraid.

For me, it's a case of weighing the odds; the balance of probability. There is no certainty; no guarantee.

The 3 factors which tip the balance for me are:

1. The PM bear market, which started in 2011, has been one of the longest in the past 50 years. All bear (and bull) market cycles come to an end eventually, to be replaced by new bulls (bears). Nothing goes on forever.
2. A rise of 20% (or a fall of 20%) is regarded as indicative of a bull (bear) market. Both Gold and Silver have risen more than 20% off their lows.
3. The 200-day moving averages of both metals are pointing up for the first time in 5 years.

Obviously, no-one should base investment decisions on anything I say though.

[WordIsBond]

Thanks WiB. That is a very good explanation. Can you please also clarify what are the rules around drawdown and inheritance? (Mid-30s, no pension contributions yet, but plan to start this year)

Many thanks.

Hi, Pegasus. Sorry I missed this earlier, it's been busy days for me. I've actually been working and making money rather than crossing swords like an idiot with other clowns and idiots on CUK.

In short, I don't know the rules precisely. I know that if I die before beginning drawdown, it goes to my wife. But the rules about drawdown are likely to change before I get tired of what I'm doing and decide to retire, so I haven't bothered to inform myself precisely. And I'd suggest there is about a 99.9% chance that they'll change before you retire. So do one thing -- make sure you are clear in your mind about the rules about >inheritance<, because that is the only one that really matters to you right now. And yeah, I'm a big believer in the tax efficiencies of pension savings, especially if you are well into higher rate bracket and can afford to sock the money away. Do it.

[lukemg]

Forget OEIC funds - the expenses make it virtually impossible to win v broad based tracker (around 85% of funds do worse over longer term AFTER expenses are considered compared to a v low cost tracker).
You will always get some funds that do better but you have NO idea which they will be ahead of time - past performance etc
- Survivorship bias - they start up loads of funds then close any not doing great = makes all the survivors look better....
- Turns out the returns are focussed around a few companies that shoot out the lights, if you have them the fund does well and if not it don't - the index defo will have them...
- Same goes for market timing, it comes down to a few great days you HAVE to be in or your returns are fcked.
SO - Read Monevator.com A LOT. Invest in Vanguard Lifestrategy, setup a monthly payment and check once a year DONT SELL UNDER ANY CIRCUMSTANCES, wait 15 years

I actually use value cost averaging instead of PCA as it forces you to buy more at low prices.

[lukemg]

Holy crap. How long have you been doing that and how long do you intend to do it. There is a line somewhere about living comfortably and being the richest man in the graveyard isn't there?

Yeah, there sure is. I had a good run contracting for years when I was younger, fast cars, hols etc and then the a**e fell out of the market I was in.
I hit the skids and hit permland and it took me 4 years to get back in the game. I swore if I got back in I would make myself immune from work, so I did and trust me it feels brilliant.

[ChimpMaster]

Yeah, there sure is. I had a good run contracting for years when I was younger, fast cars, hols etc and then the a**e fell out of the market I was in.
I hit the skids and hit permland and it took me 4 years to get back in the game. I swore if I got back in I would make myself immune from work, so I did and trust me it feels brilliant.

I've been aiming for the same thing, but as my family grows (older) then so do my expenses, and hence my target for work-immunity moves farther out.

Are you now immune from work (as you put it)? i.e. within the much-coveted realm of Financial Freedom?

If you don't mind me asking, where do you generate your residual income streams from and how much do they vary on a month-month basis?

[lukemg]

So, its dificult to work it out, but one definition that makes sense to me is you are looking at 25x annual expenses to put yourself out as FI, financially independent.
OR 20x if you dont expect to leave anything behind.
From this point you are pretty much sorted but obviously you need to take into account large future payments where appropriate/individual circumstances.
So, mine is split between investments (mostly global index ETF's + some shares- not really worth it based on returns but I have an interest in the area), family home equity (that can be released but hopefully not forced) and fixed interest stuff NS&I etc as a cash float.
After a while (years !) you notice the returns start to snowball and dividends start to get substantial and frequent. (this NEVER gets old).
This is my main passive income stream and while I have no skill as an investor I have certain characteristics that help - I never panic and sell (in fact I always think of buying when it gets shaky) and I use an automatic process to invest/allocate that takes the decision away from my flawed neanderthal short-term bias.
This was the hardest lesson to learn and has taken many years (of mistakes) really - get a couple of books if you can (four pillars of investing/random walk down wall street recommended) and read monevator (weekend reading section points you elsewhere too)
I don't prescribe this for everyone (most dont have the patience or risk tolerance), but it works for me.
I do recommend having an eye on plan B tho, BTL, investments, side projects etc

Good luck all.

[lukemg]

I've been aiming for the same thing, but as my family grows (older) then so do my expenses, and hence my target for work-immunity moves farther out.

Are you now immune from work (as you put it)? i.e. within the much-coveted realm of Financial Freedom?

If you don't mind me asking, where do you generate your residual income streams from and how much do they vary on a month-month basis?

So - I can walk away from work (or it can walk away from me !) and there will be virtually no impact on my lifestyle, but note that of course this is because I don't live right up against my current earnings level, if you do and really want to then just accept that later you will be looking at half this level if you are lucky - it's a personal choice.

Quick one on month-month income streams - I would only ever look at this over a year, you need to have a healthy float to smooth this out or you won't sleep...