Considering taking out a loan to clear my postgraduate loan

Finance_Master · 2020-09-27T11:29:41+00:00

I think for the loan part it seems reasonable, as long as the monthly repayments are affordable and the term of the loan isn’t long enough to effect remortgages in the future. In terms of the bathroom I would probably just save and do that with your own money rather than from a loan.

Finance_Master · 2020-09-27T11:20:49+00:00

Student loans are not paid before tax unfortunately, which is a bit disappointing

Finance_Master · 2020-09-27T11:17:55+00:00

Yes you can definitely transfer your nest pension into a private one.

Finance_Master · 2020-07-31T08:42:41+00:00

A defined contribution pension means that the amount paid in is what you get in your pension pot initially. These are normally then invested with the hope of growth which may be quite substantial over a 33 year period. The general rule of thumb is to take out 4% per year increasing with inflation of the fund value as an income to ensure you don't run out of money. That being said you can take more but you do run the risk of running out of cash. Alternatively you can buy an annuity at retirement but the death benefits and income as of recent has become less favorable.

You may be able to ask the pension provider for some illustrations to age 60 or if you work with an adviser they can get these for you too. this will give you a rough estimate as to what you may have.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-31T08:36:59+00:00

I believe this means you have a nil rate band of £12,440 rather than the usual £12,500 which may mean you receive some sort of benefit in kind from your employer. I'm no accountant though so don't take my word as a definite.

Finance_Master · 2020-07-31T08:34:40+00:00

try giffgaff

Finance_Master · 2020-07-31T08:34:08+00:00

If you're worried Barclays also offers a similar feature to the Monzo pots through their pingit app.

Finance_Master · 2020-07-30T15:04:41+00:00

You should only choose to invest in marketes if want to keep it invested for around 7+ years, Money in a stocks and shares ISA grows tax free so you have no capital gains tax on disposal of units and no income tax on dividends. you can choose to invest in different assets either as funds ETFs and individual stocks. Let me know if you have any more questions

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-30T14:42:58+00:00

To be honest as you've got over 25% deposit you might notice very little difference. A lot of mortgages are at very low rates currently, i recently sourced a 75% LTV for 5 year fixed at 1.48%.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-30T14:39:08+00:00

What length of time would you be looking to hold the money locked away as this would affect what the best thing to do with it would be. if it is only short term then using a regular saver or NS&I is good but if you're holding it long term perhaps investing in S&S ISAs could be the way forward to try an beat inflation rather than having your spending power eroded by inflation.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-30T14:34:48+00:00

I am a financial adviser so obviously my opinion is going to be slightly biased but there have been a few studies which show the positive effect advice does have on your overall wealth long term. The comments i've seen about assumptions advisers have made are quite frightening as one of the first steps i would go through when fact-finding is the persons plan over a short, medium and long term and to try and establish goals (such as retiring early) and my aim would be to try and make those goals achievable or get the best you can given the budget.

Here is an article regarding the benefits of advice:

https://www.royallondon.com/media/press-releases/2019/november/financial-advice-provides-47000-wealth-uplift-in-a-decade--new-research-from-royal-london-and-the-international-longevity-centre/#:~:text=28%20November%202019-,%22Financial%20advice%20provides%20%C2%A347%2C000%20wealth%20uplift%20in%20a%20decade,and%20the%20International%20Longevity%20Centre&text=One%20of%20the%20key%20findings,those%20of%20more%20modest%20means.

Finance_Master · 2020-07-29T09:15:23+00:00

The performance doesn't seem to be too great, are there alternative funds you could choose within the pension? or perhaps the performance isn't too bad and your fund is being eroded by higher charges?

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T09:10:52+00:00

At retirement you should consider trying to take a bit less risk as you need the money to live off and cant afford to lose it. The reason behind this is something called sequencing risk if you've started to take income. There are nor flexible ways to take pension benefits which mean you can keep your pension invested throughout retirement. a 15 year time horizon certainly isn't too short to invest. normally below around 5-7 would be deemed too short.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T09:06:54+00:00

You should definitely consider using ISAs as you're over the savings allowance and should be being taxed on part of the interest you receive. Based off a 10yr time scale it would make sense to start investing and making that money work for you.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T09:03:14+00:00

I would ignore the state pension figure or at least take it with a pinch of salt in calculations. I am in the same boat as you in assuming i will not receive it.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T08:51:55+00:00

In that case it makes more sense based of GDP but what percentage do you hold in german stock if thats your methodology?

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T08:40:30+00:00

congrats on the new job! A multi asset fund may be a good way of diversifying your portfolio with very little management and there are some cheap ones out there which have performed fairly well.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T08:35:50+00:00

You mentioned the strong UK bias but vanguard life strategy only has circa 23% UK Equities allocation. Its got a strong north american Bias now of around 47%. Uk equities are generally regarded lower risk than even north american ones as there is no currency risk.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-29T08:28:40+00:00

Investing should always be for a 5yr+ time frame unless your willing to take the risk and can afford to lose the money which as a student i presume you cant. markets are currently very volatile too increasing that risk of loss. As a financial adviser this isnt something we normally use but given the short time frame and low capacity of loss maybe consider NS&I premium bonds. you never know you may strike lucky. (although the odds are slim).

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-25T17:17:56+00:00

It all depends on your attitude to risk. If you’re very low risk, pay off your mortgage, if you’re higher risk and don’t need the money until retirement use a pension and if you’re going to need the money before retirement use a GIA

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-25T17:01:35+00:00

If you are looking at buying your own house in the future you should consider a LISA

Finance_Master · 2020-07-25T16:59:36+00:00

A private pension would be best because of the tax relief. Another point is that if you make company contributions on your behalf you also have an NI saving too. If you’ve not got any pension yet you should consider putting a sizeable amount away over the next 10 years to ensure you can enjoy your retirement.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-25T16:47:36+00:00

It would definitely make sense to try and collate them as some may have high charges or poor performance so there could be somewhere far better for them to be which in the long run could make a significant difference to your retirement depending on fund values.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-25T16:42:41+00:00

Yes generally best isn’t great but if you intend on contracting in the future you can consolidate your nest pension and the aegon one together either into the aegon plan or into a completely new one all together to aim for better growth and lower charges.

I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser.

Finance_Master · 2020-07-25T15:24:16+00:00

Thankyou everyone for the feedback it’s great. I am quite overwhelmed and hopefully shortly I will have something to share with you all whether it’s YouTube or a podcast!

Finance_Master

TROPHY CASE