Making the most of your savings

Not knowing what's around the corner I just like to feel I've got something to fall back on and if everything goes to plan then I can retire and enjoy my 'twilight' years. I'm possibly in the minority of 30 year olds who are planning for their retirement now with more than just a pension.[/quote]

Wise words Angie, you have to look after yourself as no one else is going to do it for you. I started a pension at 21, was pissed at the time and fell for the sales pitch but it's worked out ok... :lol:
 
My Employer contributes 8% of my salary to my private pension each year in addition to my own 5% voluntary contribution...that's about it. I have no Debt and a good salary so I'm just happy staying above the waterline if I'm honest.
 
Machine monkey said:
Dewi said:
At my age, I'm spending them! My biggest fear is dying rich :D
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:thumbsup: :rofl:
Can i interest you in buying a part share in a car project i have planed? I plan to twin turbo my car i need £1500 from you and you can have the car for 4 weekends a year if i dont kill and write it off first.
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Blimey, I'd wrap it around a lampost before you did Mr M. I'm not to be trusted with anything that fast - really! :evil: I have the gonads of a pit bull but the driving skills of Miss Daisy - not a good combination :)
 
I've simplified my various savings/stocks/funds investments and just push any spare money into an offset mortgage. Tax efficient and helping me pay back the sum sooner. Obviously if you don't have a mortgage that's not much help (unless you get a second property for rental).
 
john-e89 said:
Stratts said:
john-e89 said:
cashing in our personnel pensions early as well which you can do if you put it into property
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Only if you're over 55
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No you can cash it in early for property Stratts, only found out the other week but you can do it, i'll dig the info out and pm you if you're interested. :thumbsup:
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Wow, I was told that was technically illegal so I'd love more info. I have a decent pension pot but being 38 have been told I cannot withdraw it through conventional means until I'm 55. My financial advisor said there were means of doing it, but they are not above board and are subject to huge tax penalties if uncovered.

There is of course a difference between withdrawing the pension in cash (not meant to be allowed) and investing it in property (perfectly fine).
 
6% - 7% interest rate. https://www.wellesley.co.uk/invest-now/wellesley-mini-bond/

The above is pretty safe and simple, done via a straight forward bond with the parent company. If you want to go more "interesting" then there are many other peer-to-peer lenders achieving higher rates and your money will be lent directly.

P2P lending is still very new but the traditional banks are going to lose a lot of business to this kind of investment in the coming years.
 
dr_john said:
Santander 123 current account pays 3% up to £20k.
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It does but with restrictions, you have to have 2 direct debits going out monthly and a minimum of £500 going in monthly so it's not a savings account as such. The way round putting £500 a month in is you just make sure enough funds are in there then just withdraw £500 and put it straight back in again, as long as the system recognises a £500 deposit it's fine, so technically you can have 2 very small dd's going out and just put enough in to cover them a month. :thumbsup:
 
AndyJ said:
6% - 7% interest rate. https://www.wellesley.co.uk/invest-now/wellesley-mini-bond/

The above is pretty safe and simple, done via a straight forward bond with the parent company. If you want to go more "interesting" then there are many other peer-to-peer lenders achieving higher rates and your money will be lent directly.

P2P lending is still very new but the traditional banks are going to lose a lot of business to this kind of investment in the coming years.
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What happens if they went under? You lose your investment? I'm quite wary of companies that profess high returns.

Tim.
 
TitanTim said:
What happens if they went under? You lose your investment? I'm quite wary of companies that profess high returns.
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Morning Tim,

In the above example yes you could lose your investment if Wellesley were to completely go under. However this is extremely unlikely as they effectively act as brokers, simply taking money from investors and lending it to property developers. The risk is even lower because the vast majority of these loans are over 12-18 months (not long term and easy to monitor). These developers are intensely audited along with the specific proposal before cash is lent. Therefore it's very hard for the company to go bust unless they did something very stupid / dishonest. Their directors are all experienced businessmen and the cash already involved is pretty high.

If you preferred slightly less risk (with the invested money) then you could use the direct P2P investments they offer. https://www.wellesley.co.uk/invest-now/peer-to-peer-lending-rates/ These are slightly lower but the risk to your invested cash in negligable.

Hope that helps.
 
AndyJ said:
TitanTim said:
What happens if they went under? You lose your investment? I'm quite wary of companies that profess high returns.
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Morning Tim,

In the above example yes you could lose your investment if Wellesley were to completely go under. However this is extremely unlikely as they effectively act as brokers, simply taking money from investors and lending it to property developers. The risk is even lower because the vast majority of these loans are over 12-18 months (not long term and easy to monitor). These developers are intensely audited along with the specific proposal before cash is lent. Therefore it's very hard for the company to go bust unless they did something very stupid / dishonest. Their directors are all experienced businessmen and the cash already involved is pretty high.

If you preferred slightly less risk (with the invested money) then you could use the direct P2P investments they offer. https://www.wellesley.co.uk/invest-now/peer-to-peer-lending-rates/ These are slightly lower but the risk to your invested cash in negligable.

Hope that helps.
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Thanks for the explanation Andy, that's really useful. I've recently cashed in some stocks and shares ISAs after 15 years which gave a tidy profit so looking at maybe investing again. It's good to get feedback on these companies :)

Many thanks,

Tim.
 
We put our savings into premium bonds at the moment.
In the last 12 months we had 8 wins! :D I feel a big win coming soon though :fingertap:

Although I'm looking to buy a second property, but is it 30% deposit on a buy to let?? :cry:
 
lux said:
We put our savings into premium bonds at the moment.
In the last 12 months we had 8 wins! :D I feel a big win coming soon though :fingertap:

Although I'm looking to buy a second property, but is it 30% deposit on a buy to let?? :cry:
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Love your optimism. :thumbsup: I had money tied up in PB for a few years too but this year moved it elsewhere. I calculated the interest I was getting and it was shocking :o In 5 years I didn't have a single win that wasn't £25 (although did have more than 1 in a month occasionally) but if the big one comes in you are laughing for sure.

The big advantage of PB is that they cannot go down, unlike almost every other type of investment they are rock solid. So a very good place to be when the financial world is imploding.

Deposits on Buy to let vary depending on where you are borrowing the money from and your financial situation. Depending on the property the deposit can certainly be quite a large investment (plus purchase fees).
 
"The big advantage of PB is that they cannot go down, unlike almost every other type of investment they are rock solid."
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And a year ago the payout percantage on premium bonds as a whole was reduced from 1.5% to 1.3%.

So if you only get average returns it's no better or safer than money (up to £85k) in a UK building society and if inflation runs at 2% you will see an effective negative return of -0.7%. Like any investment it's a calculated gamble. You're hoping for a big win to exceed the average return.

There are fixed rates of 2.6% + available today. Even then you'll probably only just retain the money's purchasing power!
 
I've had premium bonds since just after I was born, so 30 years now. I've got a good amount in them but I've never won a jot! My parents and my brother in law seem to win all the time. I'm thinking of taking my money and putting it elsewhere.
 
I tend to be very cautious, the most risky thing I have is a Prudential with profits bond. I've taken 5% pa (tax free) out of it for the last few years and the capital is gradually increasing as well. So overall I'm fairly pleased with it.

I have had a couple of other with profits bonds that didn't do nearly as well but I managed to get out of them without too much damage.
 
Buy as much property to rent out as you can afford on interest only Buy To Let mortgages which can be obtained right up to age 70 with a term of 35 years. Rake in the cash each month on an asset which is increasing in value, never pay off the loan - interest only and as rents and values rise, remortgage your buy to let to the max again and draw out tax free lump sum cash each time values and rents go up whilst continuing to get an increasing monthly income. Have a ball!

The beauty about property is that you can gear up your investment. E.g. You turn your £25k into £100k and earn on £100k not just £25k. Will an annuity do that for you?

Never, ever sell the property, why would you? Make sure you don't live to be 105 and if you do, are you really going to care a out what happens to your investment property?

Never pay Capital Gains tax as you are never going to sell!

lux, you can have as little as 15% deposit for buy to let. I know.....I am a Mortgage Broker!
 
dr_john said:
I tend to be very cautious, the most risky thing I have is a Prudential with profits bond. I've taken 5% pa (tax free) out of it for the last few years and the capital is gradually increasing as well. So overall I'm fairly pleased with
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Just on this, you do realise that the 5% allowance which is for Chargeable Gains Tax is 5% Tax Defferred allowance and not Tax Free. So although you take 5% now and pay no tax on this, you may end up paying it when you cash it in. The 5% is accumulative and based on the initial investment(s) and can only be built up over 20 years, so if you take 5% each year for 20 years or use the whole allowance Built up anything over and above this amount is taxable when it is cashed in either in part or in full.

Basic rate tax is always paid by the company you have invested with but if your a high rate tax payer or the amount taken takes you into the higher rate tax bracket (as it is viewed as income) then you need to pay the difference between the higher and lower rates. Also with noting that although you will be given a Chargeable Gains Certificate it's up to you to declare this to HMRC and if the amount of gain is under 17k then this is not reported to HMRC by the company from which you held your investment but if it is over 17k they will tell them.
 
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