Ah-so Posted March 10, 2015 Share Posted March 10, 2015 The 6:15 money slot did an interview with a guy who was planning to invest his pension pot in a BTL in lieu of an annuity. He said he had done the sums, including the tax implications, been to an IFA and concluded that BTL was still a better option. The article predicted that from April, a lot money would flood into BTL. I agree that some money is going to end up in BTL, although people might smart when the withdrawals are hit with a 40% marginal tax rate. Few mortgage lenders will want to lend to the over 60s, so if this affects property values, it will be low-end type property, such as the student lets that the interviewee cited. This could still be a disaster for retirees and the housing market. The BBC needs to think carefully before giving uncritical publicity to this development. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 10, 2015 Share Posted March 10, 2015 .....because of successive government policies, bailouts,low interest rates and monetary easing....futue pension provision for all those reliant on the markets is a disaster waiting to happen....nothing about it adds up. Quote Link to comment Share on other sites More sharing options...
stuckmojo Posted March 10, 2015 Share Posted March 10, 2015 Actually, pensioners with a defined benefits pension scheme - quite a lot of them around - are perfect borrowers as their income is guaranteed until they pop their clogs. Quote Link to comment Share on other sites More sharing options...
Ah-so Posted March 10, 2015 Author Share Posted March 10, 2015 They now have a professional expert on to talk about it - a chartered surveyor and estate agent. He agreed that returns would beat annuities. Quote Link to comment Share on other sites More sharing options...
spyguy Posted March 10, 2015 Share Posted March 10, 2015 (edited) Heard that + laughed. Was going to post - you usurper you. He did not sound that old - 50s. Still he is taking professional advice - asked his daughter who's an EA and talked to the banks+ the building societies. Better get to Gloucester with my bag of magic beans before he spends all of his 20k pension pot. Got a letter from a local EA yesterday. He's called Quentin- Im not joking. So he had limited career choice - rent boy or EA. He says he'll help my buy a BTL and give me help choosing it and how much rent it'll go for. Now our local town has 1 major employer due to close in 1 year. This has been planned for 3 years. Its happening now. Another has been took over and will close in less than a year - that news has finally got out/dawned on people. Another major employee is not making money and has just done a double or quits move. Rents are determined by the LHA - reducing, and less than the mortgage cost on a rental. And local employment - crap and getting worse. And Quentin wants to advise FFS! Edited March 10, 2015 by spyguy Quote Link to comment Share on other sites More sharing options...
spyguy Posted March 10, 2015 Share Posted March 10, 2015 They now have a professional expert on to talk about it - a chartered surveyor and estate agent. He agreed that returns would beat annuities. Oh I would not want to be recorded saying that. Just as well CSd + EAs are trained accuaries + investors. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 10, 2015 Share Posted March 10, 2015 (edited) They now have a professional expert on to talk about it - a chartered surveyor and estate agent. He agreed that returns would beat annuities. Vested interests if ever there was one......large lump sums are a must when buying today, talking thousands of pounds possibly a years gross annual salary..... Who now can get their hands on that, certainly not first time buyers without help....EA are in the business of selling homes, so they target those that they see are able.....buyer bewhere......still if btlers young or old have bought all the first time buyer property, first time buyers will have no other choice but rent on their own terms and price, can't get blood out of a stone....there will be no turnover in property, there is no ladder, there is no stake in society......society has priced them out. Edited March 10, 2015 by winkie Quote Link to comment Share on other sites More sharing options...
CaptainSwing Posted March 10, 2015 Share Posted March 10, 2015 Heard it. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted March 10, 2015 Share Posted March 10, 2015 Tweeted @simonjacktoday @bbcr4today about tax on drawing out pension and effect on returns on property needed. Also Oz coming back to our pension position now bcos flexibility obviously a nightmare for the 50% who are greedy and idiotic. Having said that I'm a Libertarian. People can do what they want so long as it doesn't cost me. Quote Link to comment Share on other sites More sharing options...
2buyornot2buy Posted March 10, 2015 Share Posted March 10, 2015 I just listened to this. The presenter actually called the EA a professional. The EA was giving investment advice. An EA FFS. Quote Link to comment Share on other sites More sharing options...
@contradevian Posted March 10, 2015 Share Posted March 10, 2015 Tweeted @simonjacktoday @bbcr4today about tax on drawing out pension and effect on returns on property needed. Also Oz coming back to our pension position now bcos flexibility obviously a nightmare for the 50% who are greedy and idiotic. Having said that I'm a Libertarian. People can do what they want so long as it doesn't cost me. Well at least you are not a Twitter Libertarian. 'I'm a Libertarian providing the State buys me a house every two years. ' Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted March 10, 2015 Share Posted March 10, 2015 What's so funny? Quote Link to comment Share on other sites More sharing options...
olliegog Posted March 10, 2015 Share Posted March 10, 2015 Actually, pensioners with a defined benefits pension scheme - quite a lot of them around - are perfect borrowers as their income is guaranteed until they pop their clogs. defined benefit schemes thankfully do not fall into this insane category anyone who is already a pensioner and drawing a generous defined benefit pension would have already possibly taken a huge lump sum - sometimes £100k - and piled into BTL hope the greedy over 55s but not yet pensioners find they have jam today but bread and scrape tomorrow Quote Link to comment Share on other sites More sharing options...
Ah-so Posted March 10, 2015 Author Share Posted March 10, 2015 Tweeted @simonjacktoday @bbcr4today about tax on drawing out pension and effect on returns on property needed. Also Oz coming back to our pension position now bcos flexibility obviously a nightmare for the 50% who are greedy and idiotic. Having said that I'm a Libertarian. People can do what they want so long as it doesn't cost me. The announcer said that following the 6:15 slot there had been a lot of response on twitter. Not surprising really, if they have slots promoting BTL as the answer to our retirement woes. Yes, report on it, but stress the financial risks associated. The yields are often higger because the risk is higher and the work required is greater. How many retiring today could run a BTL portfolio when they are eighty. Quote Link to comment Share on other sites More sharing options...
richc Posted March 10, 2015 Share Posted March 10, 2015 Like lambs to the slaughter. BTL is a scam. It's a scam where the government is doing all it can to shift risk in the economy from the banks (which are now part of the government) to BTL investors. The yields in BTL make no sense. In a world of zero wage growth and zero interest rates, capital appreciation in BTL makes no sense. Well-off pensioners are going to put their savings into BTL. When the property market corrects (and it will correct), those investors will be left holding the bag, rather than the banks, and this will allow the government to avoid funding another bail out. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 10, 2015 Share Posted March 10, 2015 The announcer said that following the 6:15 slot there had been a lot of response on twitter. Not surprising really, if they have slots promoting BTL as the answer to our retirement woes. Yes, report on it, but stress the financial risks associated. The yields are often higger because the risk is higher and the work required is greater. How many retiring today could run a BTL portfolio when they are eighty. How many would want to when they are seventy, or sixty.....that is what the EA are hoping, a constant stream of money for them without the risk.....fees for selling and ongoing management fees and incidental add on fees from both landlord, tenant and contacts in the home maintenance business....easy money.....where can I sign. Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted March 10, 2015 Share Posted March 10, 2015 I think the plan might be to get the tax revenue from people withdrawing and ffalling into marginal tax bands (Although the effective tax rate is lower) I am struggling to understand how to make pension withdrawls tax efficient for someone at 65. I suppose the 25% allowance is useful but would take years to drawdown tax free. in no way compares to capital gains tax allowances on pprinciple residence. This is not advice. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted March 10, 2015 Share Posted March 10, 2015 Keeping under 40% band means just 20% tax on the 75% after tax free cash lump sum but can be a few years to clear out on that basis. Quote Link to comment Share on other sites More sharing options...
winkie Posted March 10, 2015 Share Posted March 10, 2015 I think the plan might be to get the tax revenue from people withdrawing and ffalling into marginal tax bands (Although the effective tax rate is lower) I am struggling to understand how to make pension withdrawls tax efficient for someone at 65. I suppose the 25% allowance is useful but would take years to drawdown tax free. in no way compares to capital gains tax allowances on pprinciple residence. This is not advice. Quite.....a pension from charging your hardworking priced out kids rent/housekeeping living in the principle residence would be one way of cutting out the middle men. Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted March 10, 2015 Share Posted March 10, 2015 (edited) Keeping under 40% band means just 20% tax on the 75% after tax free cash lump sum but can be a few years to clear out on that basis.Cheers. I was also thinking with the state pension income whether could keep under the 10K tax allowance? Edit: this is not advice Edited March 10, 2015 by Ash4781 Quote Link to comment Share on other sites More sharing options...
“Nasty Piece of work” Posted March 10, 2015 Share Posted March 10, 2015 "Thinking" is not what the BBC does. There will be a lot of cat food stew from drivel like this. Quote Link to comment Share on other sites More sharing options...
LC1 Posted March 10, 2015 Share Posted March 10, 2015 I heard this and couldn't believe that the BBC would be complicit in such a blatant advertorial. Actually, I could. But it's still shocking. Shouldn't all such investment advice be well balanced and clear about the risks and other downsides? This could still be a disaster for retirees and the housing market. The BBC needs to think carefully before giving uncritical publicity to this development. Quote Link to comment Share on other sites More sharing options...
porca misèria Posted March 10, 2015 Share Posted March 10, 2015 Keeping under 40% band means just 20% tax on the 75% after tax free cash lump sum but can be a few years to clear out on that basis. If your pension pot is large, take a year in a tax haven and withdraw it while outside HMRC jurisdiction. I expect the cost of that year would be seriously high, including a rent reminiscent of Mayfair, so only worth contemplating if the tax bill you're saving is substantial. Quote Link to comment Share on other sites More sharing options...
Hairy1305 Posted March 10, 2015 Share Posted March 10, 2015 Heavily ramped in the Times on Sunday too - Where to spend your pension pot... Surely it's only going to end up badly, or the rich in big houses and the rest in rabbit hutch hovel investment vehicles of the rich Quote Link to comment Share on other sites More sharing options...
Si1 Posted March 10, 2015 Share Posted March 10, 2015 (edited) Lot of pensioners going to lose a lot of money, handy way of rebalancing the wealth pot away from the old Looks good for persuading useful idiots to vote Tory, from the Tory perspective Edited March 10, 2015 by Si1 Quote Link to comment Share on other sites More sharing options...
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