"Confused Investors"

Stretch

Active member
Business Ethics went out the window in the 1980s with the concept of Shareholder Value. It has been screwing up everyone from employees through to investors since the 1980s. Ideated by Jack Welch and made poinsonous by management consultancies (McKinsey etc al). All driven by greed and not giving a s**t about anyone else.

Market regulation is a joke because all the politicians are in the pockets of the people who don’t want market regulation. “Think Tanks” and “Political Donors” should simply be illegal. You should not be able to buy political decisions and that (in my very humble opinion) is the root cause of the putrid behaviour of our stock markets.

Unfortunately, as a consumer your options are limited. You can buy from more ethical companies (if you can afford it), you can bank with the institutions that come within spitting distance of ethical behaviour; and you can invest (pensions et al) as ethically as you can (and define your own ethical priorities). But you can (in theory) choose who you work for - so if your employer‘s choices are corrupt (carefully chosen word) you can either explain the error of their ways or use a moral compass to find another job (gosh I made that sound easy).

... and yes, with current annuity rates most of us will probably be working until we die. :poop:

2p

Stretch
 

Big George

Supporter
Supporter
Annuities- there’s another way to lose money. They take your pot, give some of it back and then pocket the rest when you die leaving nothing for your family. I’ll take mine in cash (yes I know I will pay tax on it but it can be minimise) and my wife/family will get what’s left when I go.
Try working out how many years you’d have to live to use up your fund at the rate they want to pay you.
 

Stretch

Active member
Annuity income is also notionally taxable If your pension exceeds tax thresholds. Using defined contribution benefit pensions savings as drawdown is increasingly popular. Just don’t draw down enough to pay tax (ha ha).

You can of course buy annuities that provide for spouse but you pay extra for it. Especially if your spouse is a ”she” cos as a “he” you’re going to die sooner. Annuities are a weighted gamble on life expectancy.

No investment advice has been given :rolleyes:
 

Rik

Supporter
Supporter
I'd note that my employer's pension modeller gives the options of estimating a typical annuity (with varying options), drawdown over a number of years (both options with or without a lump sum), or a complete lump sum (eek!). Gives the tax implications of each option and shows the relevant lifetime thresholds and such... my ambition would be to end up paying a decent amount of taxes in retirement, but not because I took a lump sum...
 

Stretch

Active member
Agreed, I’m proud to pay the tax I owe because otherwise those less fortunate are *£@#**&ed. Does get a bit hard to swallow when HM Governement sp*nk it all into scumbag consultancies like Deloittes at £150 million a go (apologies if you work for Deloittes and are a decent, ethical, nice kind of person).

If you employee people who are qualified, treat them decently and trust them to do the job then you don’t need consultancies. FULL STOP.

Soapbox Stretch
 
  • Like
Reactions: Rik

little-else

Supporter
Supporter
AIUK Saviour
Pension law doesnt allow pension companies to be ethical, they have to get the best return they can, hence their investment models. Also, the govts forcing of them to do exercises to look at potential strain on the scheme mean thay have to hold a lot of money in govt bonds, even if those bonds pay negative interest. that is how Rishi can afford some of his schemes for dealing with the current crisis.
someone made a lot of money buying oil when it was trading at less than zero, for a refinery there are costs you bear even if people give you the crude but for futures speculators not having the oil is actually easier.
 

Stretch

Active member
Pension law doesnt allow pension companies to be ethical...
Sorry but while I get where you are coming from this just is not true. I’ve been out of financial services for a while now but the issue was never that they couldn’t be ethical, it was always that they chose not to be. It sounds like the kind of thing a typical corporate pension trustee might say though...

Unless you mean that by choosing Ethical Investment practices you would automatically be under-performing? That would also not be true.
 

Rik

Supporter
Supporter
Pension law doesnt allow pension companies to be ethical, they have to get the best return they can, hence their investment models. Also, the govts forcing of them to do exercises to look at potential strain on the scheme mean thay have to hold a lot of money in govt bonds, even if those bonds pay negative interest. that is how Rishi can afford some of his schemes for dealing with the current crisis.
someone made a lot of money buying oil when it was trading at less than zero, for a refinery there are costs you bear even if people give you the crude but for futures speculators not having the oil is actually easier.
Never heard of "ethical funds"? It all comes down to how the aims of investment are defined. Companies choose how they invest.
Personally, I choose the funds my pot is invested in, rather than taking the defaults (and some of that is indeed in "ethical" funds, which do not noticeably underperform the others).
 

Kernowlad

Supporter
Supporter
We’ve chucked a chunk of our money into a seed funding business we worked with that makes small devices which turn random motion into electricity; huge potential and the interest is massive (and from big blue chips) but it’s not risk free. It’s been a fairly long wait to reach production but almost there; most of the applications so far are in marine technology.
 

bkupris

Supporter
Supporter
American Shoot
AIUK Saviour
I have no money in the stock market whatsoever, my pension fund did but I'm getting a fixed payment every year for life now. I consider myself lucky. All of my gambling is now in crypto currencies and I am a very happy man for it :)
 

little-else

Supporter
Supporter
AIUK Saviour
Never heard of "ethical funds"? It all comes down to how the aims of investment are defined. Companies choose how they invest.
Personally, I choose the funds my pot is invested in, rather than taking the defaults (and some of that is indeed in "ethical" funds, which do not noticeably underperform the others).
but that is a personal pension plan, not a regulated employers scheme. It took the shinanigans of Robert Maxwell and the Mirror pension fund to even get regulation about investing in your own company. Before that event my pension scheme loaned large amounts to my employers and that wasnt a private business but a university so not exactly getting a stakehold in anything.
 

Rik

Supporter
Supporter
but that is a personal pension plan, not a regulated employers scheme. It took the shinanigans of Robert Maxwell and the Mirror pension fund to even get regulation about investing in your own company. Before that event my pension scheme loaned large amounts to my employers and that wasnt a private business but a university so not exactly getting a stakehold in anything.
No. This is my employers scheme. It's just not a "defined benefit" scheme (aka "final salary") it's "defined contribution" instead. The basic version is 7.5% non-contributory (i.e. they pay in the equivalent of 7.5% of your salary), but allows topping up with part matching, up to a point.

You get less control of a defined benefit scheme, arguably less risk (depending on how predatory your employer is and how lax the regulator gets). Defined benefit schemes, the risk is more in the choice of the investments and less in the raiding of the cash by robber barons.
 

Kernowlad

Supporter
Supporter
Basically you don’t trust anyone else to look after your money.
Because they are doing it to make as much as they can from you.
This has so far worked in life.
 

Stretch

Active member
Depending on the scheme you may or may not have the ability to choose your own investments/risk profile. Nowadays many are Platform/GPP/Stakeholder type products that give you choice. Others have the investment choices set by the Trustees - although I would have thought that was quite rare nowadays unless in a Final Salary scheme. Anyone who still has a final salary scheme is a lucky ba*st*rd and should stay quiet - even at 80ths accrual you will end up with a better retirement than most.

if I didn’t *trust* anyone to look after my money I’d be paying an awful lot of income tax on the money going to my pension and I’d be missing out on my 10% employer contribution... so that doesn’t sound like the best idea for my circumstance. It’s not really a matter of trust.

2p with RPI indexing

Stretch
 

tabashir

Supporter
Supporter
Market regulation is a joke because all the politicians are in the pockets of the people who don’t want market regulation. “Think Tanks” and “Political Donors” should simply be illegal. You should not be able to buy political decisions and that (in my very humble opinion) is the root cause of the putrid behaviour of our stock markets.
I don't agree with Reagan's politics, particularly as his tenure was particularly involved with the reduction of business ethics, but I did like his quote to do with the politicians:
"It has been said that politics is the second oldest profession. I have learned that it bears a striking resemblance to the first."

Although I think the most useful observation and path forward comes from the great Robin Williams:
"Politicians should wear sponsor jackets like NASCAR, that way we would know who owns them"

... and yes, with current annuity rates most of us will probably be working until we die. :poop:
I certainly will be. I'm fortunate that I have a desk job so can do that, as long as my mind stays together anyway! Those that have a physical job, I really feel for given how it is going.
 
Top