I don’t think anyone really knows but given the recent public sector pay deals and the reporting of a hole in the govt finances it seems that some revenue will need to be raised. RR has said that this won’t fall on working people and pre-election there was talk about a reimposition of the LTA.
I may be completely off-beam here but having made financial plans on the basis of one set of circumstances it would be galling to find that this planning had inadvertently resulted in the loss of 10s of 000s up-front and a lifelong reduced pension.
3 Likes
LTA will not be coming back.
Labour are happy with ILSA and ILSDBA and that they are fixed monetary values which means fiscal drag will wind the true value down over due course.
I don’t think active fund managers do usually luck out for a few years in terms of their funds beating the market on which they are benchmarked.
But most of them do luck out in terms of getting well paid by clients who do not get good returns compared to what those clients would have got if they had invested in a passive index.
Here is an intelligent discussion of active funds:
This is what’s visible on the USS site for their main equity funds up to Thursday:
And this is the 7-year picture of the same data set:
And the 1-year chart:
It’s worth remembering that most of these funds are fee-free for USS members to buy and sell, and that the user gets income tax, possible child benefit, and NI benefits as well.
My gross/generalized summary of the overall pattern of these funds is that the Sharia fund has tended to not to crash more on average than the others when corrections and bull markets occur (so far), but typically recovers better and much more strongly from dips, and has massively outperformed the other funds in the long term.
Thanks – I think the general point around ‘big tech’ (and ‘growth tech’) is that it’s here to stay, the primary concern being around the weightings of the ‘Mag 7’ within the indices i.e. to deliver to index tracker performance, there’s an (obvious) need to hold the same level of weightings, and many active fund managers will see such stock concentrations as very punchy (so under-delivery is virtually assured). Of course, we’ll have to see how AI delivers for many names, for if there is under-delivery, some of the stocks are going to get hammered given the P/E’s now.
1 Like
It also illustrates the issue caused by ETF’s/Trackers which are even more the thing in the U.S. with $$$Bn being added every month via their 401k’s, further fuelled by fomo and laziness.
‘Over weighted’ assets just become more so.
1 Like
Yep, this kind of market obesity rarely ends well – and, if you are of a certain age and capital protection is high on your agenda, I’ll take lower returns than dance with the foibles of the tech market.
1 Like
The NHS pension is a defined benefit scheme. Therefore any budgetary changes should not have an impact. The ‘pot’ is not the same as a DC pot that people are running independently.
Out of interest, why have you deferred it?
1 Like
Do you mean you have a deferred pension, rather than you are delaying taking it?
For my interest, were/are there any benefits to delaying/deferring a DB pension.
(Just curious, as we are both well esconced into our DB & state pensions. We took the Steve Miller approach,’”Take the money and run!”, albeit without the criminality of the song).
I’m a little way off retirement but I like a “global all cap” type fund for my long term investments. HSBC and Vanguard do a couple. They’re still heavily US weighted with Apple at about 5% but perform pretty nicely - a smidge below the S&P but the downside risk is similarly limited.
Jerome will say his piece at Jackson Hole on Friday. Expect the market to over react to whatever he does or doesn’t say.
There is a huge glut of cash about to come into the market. It will be interesting to see where it goes and whether it is sufficient to counter the inevitable pre US election October asset sale.
1 Like
But it was subject to the LTA - which was the justification Hunt gave for abolishing it.
I’ve watched a few of the Fed decision days recently on Bloomberg and have found it hilarious how the press release provokes a particular market reaction then Powell’s comments during the press conference pretty much cause the markets to do a 180. Serious money is being made during these events (not by me unfortunately!). I imagine he’ll position a small Sept rate cut at Jackson Hole.
Because I’m not 60 for a few more months and the scheme is based on taking the pension at 60. Taking it earlier means accepting reduced benefits - albeit that this is partially offset by the payments you get prior to reaching 60.
I intended holding out until 60 but have decided to apply for it early ‘just in case’…
Are, so you’ve not technically deferred it, you’re not at the scheme NRD yet…
Yes. The system assumes that people will take it when they retire from working - provided they have reached the age of 55 - rather than delay claiming for a period of time.
Being a self funded retiree here doesn’t have a lot of benefits. We don’t get anything that those on a government pension get, apart from cheap (out of peak hour) train travel there’s bugger all incentives.
1 Like
Hi Jim dog
Really this thread is oldish and you may have the answer already (if so apols) but you may find this useful