Have you got a pension?

[escapeUK]

Think of it this way, population getting older sitting on 600k semi detached 3 bed properites, average wage in the UK is 26k and banks getting sniffy about anything more than 5 times with a deposit.

You dont have to be clever to see the numbers do not stack up.

I know but they never stacked up, salaries havent dropped and yet someone was (and still is) paying ridiculous amounts. But in your instance they'll either sit on it unable to sell it for £600k or they will leave it to the kids (maybe before death). Ive been looking at property in Spain and France lately, and Im seeing a lot of ones for sale where you pay them £50k upfront and then an amount per year as a "pension" and when they die the property is yours. Can see that catching on here, especially with how expensive care has become.

[IR35 Avoider]

pensions are tax efficient.
no doubt about it.


If your main goal in life (and death) is to be tax efficient , then go for it. Your kids can put it on your gravestone
'here lies dad, he was tax efficient. But he left us nothing , the bastid'



by my calculations, you will live out your life on £300 per week cf £200 for me (proportion wise)

but I will be able to pass on 350,000

obviously these figures are made up, I have no idea what your pension pot will be

You said in an earlier post that your plan was to live off interest and leave capital to the kids. Both you and your kids would end up with more money if the interest was earned inside a pension. (Various reasonable assumptions made.)

(As an aside, your plan doesn't really make sense, as interest is unlikely to beat inflation by more than 1%, and may not beat it all. I guess you are thinking of spending all interest, which in effect amounts to spending capital. Nothing wrong with that, but the rate at which you plan to spend seems a bit arbitrary in that case.)

[minestrone]

Last time i was in the states I was looking at property.

Twice the size of house for half the money, mexicans that will clean the place for less than the poles do here and permission to shoot anyone in your house.

What is there not to like?

[ctdctd]

Yes I've got a pension - as it's IR35 proof, the spare cash goes in there.
If there was no IR35, I'd take it as a dividend so HMRC would get more tax now.

And as for house prices,

When I graduated in the early 80's, I was earning 7K a year, first 2 bed terraced house was 27K and I had to lie about a non-existent bonus to get a mortgage.

Now electronic engineering graduates get about 25K which would equate to a mortgage of 96K.

2 beds terraces in the same area of Luton (sorry, but it was all I could afford!) are currently going for about 140K

So if it was a struggle to buy then, it's bloody near impossible now. I don't think the house price crash has happened yet.

[MarillionFan]

Last time i was in the states I was looking at property.

Twice the size of house for half the money, mexicans that will clean the place for less than the poles do here and permission to shoot anyone in your house.

What is there not to like?

Not in California mate! For San Diego or San Jose, it's half the size and 5 times the cost. Bloody unreal. For the same size as my house (5 bed, 4 bathroom - 2600 sq ft) the feckers want
$8-$10k rent!!! My mortgage is only £350 a month.

[BrilloPad]

What is the point of a pension when the government is going to inflate it away. Best way is to spend it. So its either hookers and cocaine or children.

[MarillionFan]

What is the point of a pension when the government is going to inflate it away. Best way is to spend it. So its either hookers and cocaine or children.

Or cocaine fueled child prostitutes! 3 for 1.

[BrilloPad]

Or cocaine fueled child prostitutes! 3 for 1.

The spirit of Jimmy Savile lives on.

[formant]

Yes I've got a pension - as it's IR35 proof, the spare cash goes in there.
If there was no IR35, I'd take it as a dividend so HMRC would get more tax now.

And as for house prices,

When I graduated in the early 80's, I was earning 7K a year, first 2 bed terraced house was 27K and I had to lie about a non-existent bonus to get a mortgage.

Now electronic engineering graduates get about 25K which would equate to a mortgage of 96K.

2 beds terraces in the same area of Luton (sorry, but it was all I could afford!) are currently going for about 140K

So if it was a struggle to buy then, it's bloody near impossible now. I don't think the house price crash has happened yet.

Newsflash - move further away from the capital (I'm still only an hour's train ride away) and you can still easily find one-bed flats from 50k and 4-bed detatched (not even ex-council or rubbish area) for around 170-180k. Yeah in London and the Home Counties you'll struggle with property buying on entry-level salaries, but there's actually still 'hope' for the rest of the country.

I have little interest in high value property for buy-to-let purposes anyway - I find that cash-buying a few lower priced flats gives a higher rental return and more stability in the long run.

[ctdctd]

Newsflash - move further away from the capital (I'm still only an hour's train ride away) and you can still easily find one-bed flats from 50k and 4-bed detatched (not even ex-council or rubbish area) for around 170-180k. Yeah in London and the Home Counties you'll struggle with property buying on entry-level salaries, but there's actually still 'hope' for the rest of the country.

I have little interest in high value property for buy-to-let purposes anyway - I find that cash-buying a few lower priced flats gives a higher rental return and more stability in the long run.

But no jobs in the sticks - and long term commute to the big city is expensive and soul destroying.
Fine for landlords, benefits claimants, and the retired though.