flooding

[Mel B]

BIG YAWN. :-S

[Guest caraprof]

Mel B - 2007-07-30 9:30 PM BIG YAWN. :-S

It's no good posting these two-word ripostes Mel when your signature is longer than most people's threads.

PS Did it really take you two days to think of that?

[Mel B]

My goodness Frank, you REALLY don't know when to stop do you? 8-)

 

Some of us have better things to do than respond to you all the time. I've still got to work for a living so am not as fortunate as some members who post on here (can't wait until I am!). Work is bl**dy hard at the moment so if you'll excuse me I'll get back to something more interesting with the time I can spend on here.

 

Feel free to have some more digs at me if you wish, I really don't give a toss, but if it keeps you amused, then go ahead.

 

I can't wait until tomorrow for a bit of peace and quiet. :-|

 

I sincerely hope you have a good holiday though. B-)

[Guest caraprof]

So why did you post the 'big yawn' post two days after it was all over again?

[Mel B]

EVEN BIGGER (AND QUICKER) YAWN .....

[donna miller]

Yes Frank, have a good holiday.

 

But remember not to speak to people like you do on here, because you havn't got a keyboard to hide behind, and the written word hurts a lot less than a real kick in the nuts.

[Guest caraprof]

donna miller - 2007-07-31 8:29 AM Yes Frank, have a good holiday. But remember not to speak to people like you do on here, because you havn't got a keyboard to hide behind, and the written word hurts a lot less than a real kick in the nuts.

I'm just about to go but I have to say this! This is rich coming from you! Your recent pop at me on another thread, which not only I thought was unjustified (read what others said) makes you the last person to criticize me for having a go at people. In the 'Can you justify' thread your personal intervention was nasty and rude and totally uncalled for. It personalised a thread in which I had made no derogatory comments about anyone.

There are one or two women on this forum who seem to delight in stirring up things that are either dead or should not be stirred. You are one of them. You obviously don't like me, probably because of some earlier run-in, but I really couldn't care bless, you are nothing to me and whether you approve of me or not is irrelevent.

I just wish however, that you would learn that allowing personal animosity into otherwise civilised discussions is ill-mannered and uncalled for.

[Guest caraprof]

Oops, pressed it twice.

[CliveH]

 

A couple of points - firstly considering the vociferous nature of posts on an adjacent thread re there going off topic could I just underline that the topic is "Flooding!" - Sorry - my sense of humour!!!

 

Secondly - as regards investment in anything - it was mentioned that the taxman does not benefit from shares - Oh yes he does!!!!!

 

Companies have to pay Corporation Tax on profit

 

As for buying and selling shares direct then yes it is a case of caveat emptor - the stockbroker/bank/whoever just acts on your instructions.

 

If you want advice then go to an IFA who will either charge a fee for the advice or if you wish will take a commission. The advice given via an IFA is regulated by a Government Agency (FSA) and the IFA has to justify the recommendation and you can obtain compensation if the advice is wrong.

 

A lot of nonsense is spoken about commission because the Taxman wants it banned because no VAT is charged on commission. So if you agree that the cost of advice is £100 for example then via a fee it will be £117.50 but if you allow the adviser to take their fee via a commission then the cost is £100.

 

A couple of further points - this £100 cost via a commission is spread usually over the first four to five years as an "establishment charge" - and is fully explained in the illustration you must by law receive.

 

Also if you cancel the policy within the "establishment charge" period the adviser has to pay back to the provider the excess. So from the advisers viewpoint Fees are better because so what if you pay the VAT, once the money is in the bank, it matters not if you cancel the investment plan!

 

Not surprisingly then that when people are given the choice most go for the commission route.

 

If the plan you want is a pension and you are a basic rate taxpayer then with BR at 20% the £100 is reduced to £80 spread over 4 or 5 years! If you are a higher rate taxpayer, then the net cost is just £60.

 

Compare that to £117.50 up front!!

 

 

 

Finally - my advice if you want to invest a lump sum then do so regularly via “Phasing” rather than committing the lump sum up front.

 

Follow this scenario

 

A investor has £1000 and placed in a unit trust/share at £1 a unit/share

 

The next month the price per unit/share falls to 50p – so the investor has “ lost” £500 as the 1000 units/shares he owns are only worth at that point £500.

 

The month after the price recovers back to £1 and so the investor is back to where he started – no gain, no loss, just a three month roller coaster ride starting and ending with 1000 units/shares = £1000

 

 

Compare that to the person who invests £100 per month. In month one they invest £100 which buys 100 units/shares, then in month two becomes worth £50, BUT in month two they invest another £100 which because the unit/share price is only 50p, buys them 200 units.

 

Then in month three they invest a further £100 to buy a further 100 units/shares

 

Thus the outlay is £100 + £100 + £100 = £300

 

But the value at the end of month three is 100 + 200 + 100 = 400 units at £1 per unit = £400

 

This process is called £ cost averaging and works because with a volatile investment you always buy more units when the price is low. As such you are then actually USING the fact that unit prices go down as well as up to your advantage.

 

Therefore my advice (as an authorised IFA regulated by the FSA) is not to invest lump sums in volatile investments (unless you are certain it will only go up!!!!! – and if you do know of any – PLEASE send me a PM) but phase it in over time.

 

[Mel B]

Free speech rules ... KO! (lol)

[W3526602]

Hi CliveH

 

Ah, but if I have £1000, and only invest £100 of it in the first month, then I have £900 sitting under my matress earning nothing....but then it isn't losing anything either. Or is it?

 

OT, and none of your business, and none of mine either....my son is in Australia. He has a lot of money in some sort of account with a UK bank in the UK. We open his mail, and email him what the statement says.

 

We are worried that the interest is only 0.2% while we would have expected it to be nearer 5% (or am I being ambitious?) Mind you, I can't remember if the statements arrive yearly or six monthly. Any comments? By PM if appropriate.

 

602

[CliveH]

 

Morning W3526602

 

If you have a low interest earning account then yes the £900 would not be earning much, but as you say most deposit based accounts now should be giving circa 5%.

 

What I did not say before was that another advantage of monthly regular phased investing is that YOU are in control of the "tap" and can turn it on and off as conditions dictate.

 

If you commit a lump sum then you are just that - committed!

 

 

As regards your son in Australia - my first thought is if he is in Oz, what the heck is he doing with "a lot of money" in a UK account where the interest will be liable to tax?

 

Without knowing all the ins and outs it is difficult to comment but we do have clients that work abroad for long periods and invariably we recommend an Offshore investment for them.

 

If he is to return to the UK soon then Jersey, Guernsey or the IoM are OK but if he is to stay abroad for a while we would recommend the EU International Finance Centres of Dublin or Luxemburg. The difference is that (surprisingly for most UK citizens) Dublin and Luxemburg have better Investor protection because the are individual EU States whereas the CI's and the IoM are UK Dependent States and as such are not full EU States.

 

Most providers of offshore accounts allow you to access either depending on your circumstances.

 

Your son could (and should in my professional opinion) move his money offshore to obtain gross role up as well as a far better rate than he is getting now. If he is out of the UK for a while he can repatriate the funds without a tax hit if he follows some simple rules.

 

The other alternative would be an ISA but he has to have a valid UK NI number to have an ISA and so unless he set it up before he went to Oz this may be problematic. The type of ISA available will depend upon the amount (Mini, Maxi, Cash or Equity [Or tho you can have a Cash Fund within a Maxi Equity ISA – Something the Banks do not generally tell you])

 

If you want more info then do PM me. I really do feel you are right to be concerned. With interest rates going up, having all that money in a Bank Account earning just 0.2% means that your son is literally paying about 4.8% to the Bank every year because they sure as hell are placing your sons money on the spot market and getting 5%!!

 

It is not as if the Banks are not making enough profit!!!

 

There are lots of far better options.

 

 

[michele]

bump 8-)

[Mel B]

Michele .. will you stop bumping! I keep reading posts and thinking "that sounds familiar", then I realise it's one you've bumped from months ago ... 8-)