Investing Money-Food for thought

[Skorp1o]

My mate (45) been whatsapping me saying he wanted to start a stocks and shares ISA in the hope to build up a decent pot of money as he might consider semi retiring in his mid 50's especially since the limit is increased to 15k. He always put all his money into savings accounts earning an insulting figure of interest. He started firing off questions how can I get 10, 20% return in the first year.

I said to him if you want to invest in shares yet only want the money in your mid 50's I can GURANTEE YOU 40% return on every single pound you put into it. You can open a SIPP (Self Invested Personal Pension) with a trading platform, as a higher rate tax payer, you will get a 40% tax relief on all monies you put in. If you invest £10,000 into this SIPP in one year, as a higher rate tax payer this will be bumped up to £14000 via a 40% tax relief.

The above is before any anticipated gains you may reap over the long run from the shares you bought.

[bigmc]

you cant guarantee that mate

there may be a high chance you can do it

but if you could guarantee 40 percent

you would be the richest man in Britain

that being said im due some funds next year which I might throw your way 

[Skorp1o]

It's an automatic tax relief not an actual gain from shares price increases....I do this every year for my SIPP...I'm a higher rate tax payer, you should not be taxed for money you put into your pension HMRC treats it as if you paid into it gross before deductions. However you have to claim it.

From HMRC:
Personal pensions

You pay Income Tax on your earnings before any pension contribution, but the pension provider claims tax back from the government at the basic rate of 20%. In practice, this means that for every £80 you pay into your pension, you end up with £100 in your pension pot. If you pay tax at higher rate, you can claim the difference through your tax return or by telephoning or writing to HMRC. If you're an additional rate taxpayer you'll have to claim the difference through.

http://www.hmrc.gov.uk/incometax/relief-pension.htm#1

If you're coming across some money, the limit to invest in a SIPP is 50k per annum, you could invest it in a SIPP and get automatic 20% tax relief so the will see the monies held in at £60k before you buy into anything, then an additional 20% will be granted by requesting it...I just wrote a letter to them and they refunded me 18months worth.

I'm not a rich man from this piece of info as it's a common yet uncommonly known information, it is basic financial advice dished out by all IFA's to their clients who invest in pensions...but people with IFA's are usually well off and financially savvy people already, the rest are left in the dark about simple rights. You already paid 40% on earnings, you are saving for your retirement and the tax man should not tax you for that. hence the gross should go in the pot...this is where the tax refund comes in.

[denarii]

skorps 'hook' is a 40% tax upside, then its a few juicy ipos in unknown small caps that he flips in the first 5 mins or few days, then it a managed service that 'goes wrong for completely unforeseeable reasons' 

[Skorp1o]

skorps 'hook' is a 40% tax upside, then its a few juicy ipos in unknown small caps that he flips in the first 5 mins or few days, then it a managed service that 'goes wrong for completely unforeseeable reasons' 

You can invest in any personal pension even a very low risk one and get that 40% refund. 20% is automaticly done so if you out 100 this shows at 120 in your pot, in your tax return claim the extra 20....that's like a 40% return extra than if you went the isa route...no brainer. I use it as a tax damage control for my bonus.

But bare in mind you can't access pension fund until 55...this is good news for gambling addicts and spenders

[Skorp1o]

What type of shares are we talking about here?

I mostly invest in FTSE companies...never do small cap.

This doesn't have to be shares, any personal pension would allow you to reclaim the tax.

[bigmc]

I mostly invest in FTSE companies...never do small cap.

This doesn't have to be shares, any personal pension would allow you to reclaim the tax.

What about commodities

[Skorp1o]

What about commodities

I stick with equities cos that's my line of work...I have access to lots of info on British companies and what's hot.

[Pork_Chop]

Get on the Stevia investment, pure circle holdings i think they're called.

$50 to $600 a share now in 24 months.

Now coca cola are going to roll out stevia instead of the unhealthy aspartame as their diet ingredient, it's only going to swell more.

[Pork_Chop]

Also internet tv providers - netflix etc.

Sky boxes will be a thing of the past in 5 years from now or so.

It will be internet tv with IPTV boxes to receive it.

Sky will be an app and thats it. They're shitting themselves and rushing now TV to the market, because studies have shown younger people are not getting sky installs - they are simply getting netflix etc so they can watch on-demand and across multiple devices.

Sky charge £80 a month for all packages total, and even £10 just for receiving HD - netflix is £5-8 a month depending how many devices / people you want to use it.

[Pork_Chop]

Finally buy some gold bullion coins, probably go for the 1oz Britannia instead of the Krugerand - as they dont qualify for capital gains.

They are circa £820 each at present.

If Scotland leaves the UK, foreign investors, especially the japanese will get the jitters and sterling might drop 15% in just a few months.

You can get a fast upside from the situation.

[Omega]

Finally buy some gold bullion coins, probably go for the 1oz Britannia instead of the Krugerand - as they dont qualify for capital gains.

They are circa £820 each at present.

If Scotland leaves the UK, foreign investors, especially the japanese will get the jitters and sterling might drop 15% in just a few months.

You can get a fast upside from the situation.

Where is the best place to buy from?

[Pork_Chop]

Where is the best place to buy from?

I bought 2no Krugerand (1oz) as they are the easiest by far to re-sell.

I bought them from bullion by post.

The transaction was done, then i got confirmation and the next working day they were delivered and signed for on my doorstep.

Apparently the Britannia or whatever it is, the British gold coin is free from capital gains tax - but sod that.

The coin to get is either the chinese Panda, or the american Buffalo (replaced the eagle about 5 years ago) - they are slightly more but also collectable.

They weigh a ton in your hand, very heavy indeed. I hope to buy some every year where possible. Just hide them under the floor board or somewhere 

PS- if you buy from that company , they do a buy-back scheme where they can see your purchase history and do an immediate deal.

[Skorp1o]

I thought about Gold recently, but it's a long term holding for real returns from my research. Looking at the performance it does steadily and reliably deliver over longer term even, bets thing about it is hedges against capital markets (mainly equities) volatility. I might buy some come bonus time if I have a surplus just to balance out my exposure as I put pretty much everything into equities.

But seriously guys, consider this tax relief you get when investing. Especially higher rate tax payer, getting back 40% on cash invested is not to be sniffed at.

[denarii]

i love gold long term, have been taken aback by last 2 1/2 yrs and dont think the bottom is in, the bottom is in when yellen folds on tightening i think. probably the actual price bottom is some capitulation before that.

[Skorp1o]

i love gold long term, have been taken aback by last 2 1/2 yrs and dont think the bottom is in, the bottom is in when yellen folds on tightening i think. probably the actual price bottom is some capitulation before that.

When the market was drastically dropping, people went for Gold, I remember there was a buzz about it years ago.

I always saw Gold as a good wealth preserver....seeing as I am trying to build wealth in the first place I have other places to put my money in. Jumping into the stock market post crunch was a very good strategy for me, but now things are levelling out and I have to take a lot more care when switching stocks or taking new positions.

[Wolfox]

There's only one company you need to know: Amazon



In 10 years they will be bigger than WalMart.

[Skorp1o]

There's only company you need to know: Amazon



In 10 years they will be bigger than WalMart.

I'm already in, I said this to a couple of GB'ers via PM.

But from experience unpredictable things can and do happen, so once in you need to regularly evaluate. I had high hopes for apple to finish strong this year, but a few things dampened it for me in the past few weeks including Jennifer Lawrences cum filled eye lids.

[denarii]

Amazon is so successful they don't even make a profit. Lol

[Wolfox]

Amazon is so successful they don't even make a profit. Lol

They're not trying to. Just look how much they've grown. They are willing to break even to expand and own the market - and they are accomplishing that goal. Its not a quick short term investment...think 10-20 years down the road. Amazon is already a household name. Think of what digital downloads did to brick and mortar record stores. Online shopping has increased every year and will continue to increase. Amazon owns a HUGe chunk of that market. The biggest chunk. Right now there isn't a single competitor like it.

Amazon is the future.

Get on now - profit later.

[denarii]

They are willing to break even to expand and own the market - and they are accomplishing that goal. Its not a quick short term investment...think 10-20 years down the road.

why cant they expand while making a profit?