My staged sell off of holdings in the two tech funds worked a treat last week, but the question then is, as always, what to do with the cash? Given my age I am generally looking to reduce risk. my natural default option is stick it in Vanguatd Life Strategy, but I'd be interested in other options for a fairly solid low risk (compared with tech focused) fund.
Define low risk? Personally one (or more than one) of the lifestyle funds you could do worse, but not really sure what else you have or when you wish to draw etc.
I use the lifestyle funds, predominantly as a holding place for shortish periods.
Well, I had the tech funds in both SIPP and regular portfolio, so the *low risk* requirement is more for the SIPP. I just checked and Vanguard Life Stratgey 20% and 40% account for 31% of my SIPP, and currently cash accounts for another 17%. Although I am now 67, I don't currently see the need to do anything with the SIPP for a couple of years. So I could look for some reasonable growth, but a lot less volatility than the two tech funds.
Outside the SIPP, I wonder what general sectors/themes people fancy now, if tech is considered to be a bit "toppy"? I'm not sure I buy the "UK is undervalued" story, although I did buy a Vanguard FTSE250 ETF, denominated in euros in my Degiro account, and it has done quite well so far. I've also done very well so far buying funds in the "Sustainable" sector although some of their holdings leave me feeling a bit cynical about it. I have nothing Asia-Pacific focused, and only a bit of a Japanese fund, in the SIPP. As for the US I just have a tracker fund, in both portfolios - I didn't fancy investing specifically there while Trump was in office.
The UK is definitely "undervalued". A webinar I attended this afternoon had UK equities at 56% of its 15 year high. All other global markets were above 90%, with Europe & Japan the next lowest at 92%. The US is of course at 100%.
The consensus is still to invest in China & to a lesser degree other Asian economies as well as emerging markets. My thoughts, in a 60/40 portfolio, is to have around 22% UK, 18% US, 8% Europe & the remaining 12% split between China, Japan & emerging markets.
In the UK I'd go for small and mid-cap and again the consensus is to look at value over growth stocks. My favourites at the moment are Artemis UK select, Octopus Micro cap and if you can stomach the 5% charge any of the Premier Miton UK funds.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
The NatWest scheme would have seen you contracted out for that period.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
After you stop working, I believe you can make voluntary class 3 contributions to bring you up to the full pension.
You'll should only need an extra year's worth of contributions to get you there. No idea whether this would be worthwhile though!
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
The NatWest scheme would have seen you contracted out for that period.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
But in addition to the basic state pension you will have the benefit of an inflation linked lifetime pension which I imagine, based on 18 years service with a High Street bank, will be approx 1/3 of your then salary. Many many people of your age didnt have the option to join a Company pension, certainly not a DB one.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
Don't forget when you 'opted out' you paid a lower rate of NI, used to be around 1.6% less.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
Don't forget when you 'opted out' you paid a lower rate of NI, used to be around 1.6% less.
....true but the amount of NI I have paid is still substantially more than most of the UK workforce are paying. It is what it is I guess.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
Don't forget when you 'opted out' you paid a lower rate of NI, used to be around 1.6% less.
....true but the amount of NI I have paid is still substantially more than most of the UK workforce are paying. It is what it is I guess.
Agree I had 44 years of continued contributions largely opted out. However, receive less than someone with 35 years opted in. I’m pretty sure sure my additional 9 years of contributions would make up what I saved on being opted out. But, that’s life....
If you work out how much it would cost to get a pension of eight grand a year with inflation (+ 2% ?), it's still a bargain!
This. Have a look at the figures DB scheme now have to produce to show the real annuity cost. I have NHS Doctors retiring on £45k pa and the annuity "cost" is around £2.2m. That's TWICE the LTA - which means that anyone trying to emulate an NHS pension of that size would need a pension pot of over £2m.
I also expect that your Nat West pension was non-contributory. For context, the NHS used to be 6% for all doctors & nurses. It's now income based & the top grade staff pay over 14%.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
Don't forget when you 'opted out' you paid a lower rate of NI, used to be around 1.6% less.
....true but the amount of NI I have paid is still substantially more than most of the UK workforce are paying. It is what it is I guess.
Snap, but it's not the amount you pay (when it suits them) but time opted in, doesn't matter if you earn £10k a year or £1m the state pension is the same regardless.
FTSE100 trading above 7000 since the crash last year. Hopefully it can hold steady there for a while - might see it back towards 7500 by the end of the year.
State Pension query: Despite having 38 ‘Full Years’ of NI contributions and no gaps, why is it that the forecast says I need to pay in for another 4 years to achieve the maximum state pension, currently £179.60? It says I currently would get £159 which is a significant reduction over a year/retirement lifetime. That would mean I will have paid in for 42 full years against the requirement to pay in for 30 full years. I checked my NHS payslip and that even confirms my NI Contribution code as ‘A’ which means I am not contracted out. Prior to joining the NHS, I worked for Natwest for 18 years solid and was part of their non-contributory pension scheme.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
NatWest was almost certainly Final Salary and DB scheme hence they would have contracted you out. You have to have full number of years contracted in, to get max pension.
An even fuller answer. The basic state pension is based on "contracted in" service. By being in an DB scheme your employers have "guaranteed" a certain level of pension income & thus you are "contracted out" of part of the state pension. The lines have been blurred due to the change in the state pension & it now being "all compassing" - whereas in years gone past it was split between "basic" " contracted in" & even "graduated". Remember SERPS & contracting out.
Thanks Golfie. It’s hard to swallow the need to pay in for 42 years when you consider I have been paying NI of £452 every month for many, many years and full NI every month for 38 years. Feels like I have more than justified £179.60 per week. I must be contributing more than 80% of the workforce do and yet they, currently, will receive more than I would!
Don't forget when you 'opted out' you paid a lower rate of NI, used to be around 1.6% less.
....true but the amount of NI I have paid is still substantially more than most of the UK workforce are paying. It is what it is I guess.
Snap, but it's not the amount you pay (when it suits them) but time opted in, doesn't matter if you earn £10k a year or £1m the state pension is the same regardless.
Not now, but it did before they changed it. That was what SERPS element was all about.
FTSE100 trading above 7000 since the crash last year. Hopefully it can hold steady there for a while - might see it back towards 7500 by the end of the year.
Loving it.
That's my current mix. Done largely due to low fees, and my risk appetite.
I rebalanced it a couple times, because I realised I don't believe in hedging as a personal investor, up 20.35% since account opening (May 28th 2020).
FTSE100 trading above 7000 since the crash last year. Hopefully it can hold steady there for a while - might see it back towards 7500 by the end of the year.
Loving it.
That's my current mix. Done largely due to low fees, and my risk appetite.
I rebalanced it a couple times, because I realised I don't believe in hedging as a personal investor, up 20.35% since account opening (May 28th 2020).
Oh and £1k worth of deliveroo shares that will just about buy me a takeaway for 2 now...
I'm a bit light on the UK side. Only hold Artemis UK Select which has performed well for the months I've purchased.
@golfaddick, you've mentioned Chelverton UK equity a few times. Any current views on it?
Of my live holdings Chelverton is currently my best performer % profit wise, put some in 30th July (£2.42) and 26th November (£2.88) so averaged buy at £2.51 (£17.5k in July and £5k in November) and currently sit 48.08% up. Been a stonking performer.
I'm tempted to cash in some of the profit, or like normal take out my initial investment and hold the profit.
I'm a bit light on the UK side. Only hold Artemis UK Select which has performed well for the months I've purchased.
@golfaddick, you've mentioned Chelverton UK equity a few times. Any current views on it?
Of my live holdings Chelverton is currently my best performer % profit wise, put some in 30th July (£2.42) and 26th November (£2.88) so averaged buy at £2.51 (£17.5k in July and £5k in November) and currently sit 48.08% up. Been a stonking performer.
I'm tempted to cash in some of the profit, or like normal take out my initial investment and hold the profit.
Is that the equity income or equity growth fund mate?
I'm a bit light on the UK side. Only hold Artemis UK Select which has performed well for the months I've purchased.
@golfaddick, you've mentioned Chelverton UK equity a few times. Any current views on it?
Of my live holdings Chelverton is currently my best performer % profit wise, put some in 30th July (£2.42) and 26th November (£2.88) so averaged buy at £2.51 (£17.5k in July and £5k in November) and currently sit 48.08% up. Been a stonking performer.
I'm tempted to cash in some of the profit, or like normal take out my initial investment and hold the profit.
Is that the equity income or equity growth fund mate?
Did you manage to take some profit out amongt the profit takers this week @Rob7Lee?
I might dip into Chelverton this week as can see the FTSE falling back to where it was in December this week.
Yes, I took a bit in my ISA (as may use some of that when we move later this year) but left the SIPP alone for now (which is where the above numbers are) aside from that I might cash some of the BG European fund in my SIPP as that's up 30%+ since last July. Even my Gold fund is back in profit (by just under 1%!)
After you stop working, I believe you can make voluntary class 3 contributions to bring you up to the full pension.
You'll should only need an extra year's worth of contributions to get you there. No idea whether this would be worthwhile though!
Quite likely it is worth it. I was looking at it for my wife and I worked out if she lives 4 years past retirement (state age) she will have recouped her initial outlay. However will be slightly different for different individuals and also tax needs to be considered depending on what other income you have. Remember state pension is taxable whereas you won't get any tax relief for the initial outlay.
Comments
The consensus is still to invest in China & to a lesser degree other Asian economies as well as emerging markets. My thoughts, in a 60/40 portfolio, is to have around 22% UK, 18% US, 8% Europe & the remaining 12% split between China, Japan & emerging markets.
In the UK I'd go for small and mid-cap and again the consensus is to look at value over growth stocks. My favourites at the moment are Artemis UK select, Octopus Micro cap and if you can stomach the 5% charge any of the Premier Miton UK funds.
Bit worrying as I plan to retire in just over 3 years time at the age of 58.
I phoned the Government Pensions department who aren’t willing to talk to me about it because I am not close enough to retirement.
Help? Reassurance? Any similar experience of this anyone? Suggested solution? Does it sound right to you?
Ring them again and insist, because that is the only way you will get the answer.
NI was originally meant to pay for health and unemployment insurance as well as a pension?
I also expect that your Nat West pension was non-contributory. For context, the NHS used to be 6% for all doctors & nurses. It's now income based & the top grade staff pay over 14%.
That's my current mix. Done largely due to low fees, and my risk appetite.
I rebalanced it a couple times, because I realised I don't believe in hedging as a personal investor, up 20.35% since account opening (May 28th 2020).
Oh and £1k worth of deliveroo shares that will just about buy me a takeaway for 2 now...
@golfaddick, you've mentioned Chelverton UK equity a few times. Any current views on it?
I'm tempted to cash in some of the profit, or like normal take out my initial investment and hold the profit.
I might dip into Chelverton this week as can see the FTSE falling back to where it was in December this week.
thank you all for your advice on the pension question I raised greatly appreciated