As I understand it, the pension regulations will change next April to allow individuals to withdraw up to 50% of their fund to invest at will. This is likely to have an uplifting effect on property prices, but what about equities?
Jeremy
Where did you hear this?
Rob Graham
The only 50% that I can find is the amount that a SIPP may 'borrow' to invest in an asset.
I'm inclined to think that a few iterations of Chinese Whispers gets you to the OP's suggestion
tim
"tim \(moved to sweden\)" wrote
SIPPs haven't been around for long enough and very few have enough in them to purchase a property larger than a garden shed, so the effect on property prices is likely to be insignificant.
15 years
Bearing in mind that they were, for most of that period, the reserve of the people prepared, and able, to make large contributions there are quite a few with several 100K
Under the new rules you can put 215K in in one year. is that enough?
Agreed, but hopefully because people with that amount of money to invest will have realised that the market is no longer growing at 15% pa.
tim
We had the company's financial advisers in a few weeks ago.
In message , Jeremy writes
Change them then.
What gross salary would you need to be on to do that?
A lot of high earners are on dividends which means they can put in just 2.8k a year.
"John-Smith" wrote
Ermm - Nothing? [As long as you have the 215K funds from somewhere?]
"John-Smith" wrote
That's old rules, isn't it? Don't new rules allow an annual limit of 215K irregardless of "salary"? [You might not get full tax relief on the contributions when paid, if there is no corresponding tax having been paid on those funds...]
The problem is finding property that is not overpriced by 30% or more.
In message , Jeremy writes
What makes you think that?
Because of the leverage effect of mortgaging. It's not realistic to compare asset growth rates, if you're borrowing to invest in one asset and not in the other. In other words, 1% growth in the property market is worth more than 5% growth in the equity market, if you're borrowing
90% of the value of the property - and can cover costs with rental income.
Nor risks.
And a 1% fall is equal to a 10% fall in the equity markets.
You said "a similar level of risk". It is *much* more risky to invest 10,000 in a property worth 100,000 than to invest 10,000 in equities. It's not only that the leveraging applies to falls as well as rises, but also the risk that you can't cover the costs with the rental income.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.