Listener Questions - Episode 6

In this episode we answer questions about RSU’s, the Cashflow Ladder, Pension vs LISA and a whole lot more!

Shownotes: https://meaningfulmoney.tv/QA6 

01:42  Question 1

Hello Pete and Roger. Recently discovered this and am listening to every single episode. Brilliant. I've read a fair amount about the % balance of Equities, Bonds/Gilts and Cash I should have in my retirement pot, based on my age (61). Somewhere in the 40%s for Equities, perhaps. What I am not finding advice on is whether I should include my DB pension in this equation and, if so, how? Do I consider it to be cash? And if so do I use the transfer value or use the predicted annual pension pay-out in some kind of calculation?  Thanks for any clues! Best wishes, Phil

11:14  Question 2

I enjoy listening to your podcasts whilst running and I read your book, recommended to me by a financial advisor friend. I’m 37, and early next year I am likely to get around £220k from some shares I hold in the company I work at. If capital gains tax rises, I guess I’ll see, at best, £150k. Any advice on the best place to keep it / invest it for up to 5 years?

We plan to then use it to relocate abroad and perhaps set up a lifestyle business such as a B&B. I read about setting up a 'dividend-paying company' which could be useful as it’s often accepted as ‘passive income’ when moving to another country (potentially Portugal or Cyprus). This holding company could pay out whilst growing the savings through managed investing. Is this a potential option for my money?

Many thanks, Faye.

19:14  Question 3

Your recent podcast on Helpful Basics: Self-employment and Side Hustles got me thinking about retirement saving vehicles. Specifically, what is the best investment vehicle for a self-employed basic rate taxpayer; a pension or a stocks & shares LISA for retirement purposes?

Personally, I am 44 years old and started a LISA from its inception. I am a homeowner. Is it best to maximise LISA contributions until I am 50 years old, then focus on pension contributions?

I have a pension pot of £250k which I am minimally contributing to, preferring to prioritise LISA (and ISA) contributions. I like the idea of the 25% bonus on contributions and tax-free withdrawals, which should complement future pension withdrawals from the pension pot in a tax efficient manner.

Any guidance would be greatly appreciated. Best wishes, Adam

23:06  Question 4

Where someone has had a number of jobs over their career then consolidating multiple DC pension pots can seem attractive (to reduce admin and costs etc). However, what sort of benefits/ guarantees can be lost by transferring pensions, in particular are there specific things to be aware of with regard to older stakeholder / with profits pensions?

It would be handy to know what to look for and what sensible questions to ask when talking to existing pension providers.

Thank you G Locke

32:05  Question 5

Hi Pete and Roger,

Loving your podcasts, great content as always. A question to do with retirement cashflow forecast planning.

I have been reading an article by an American financial planner named Ty Bernicke. In his article, he asserts that retirees voluntarily spend less as they get older, referencing statistics from US government departments.

Is there any equivalent recent research in the UK? Should I use his approach and figures when attempting my own forecast?

With very best wishes and thanks again, James Cotterill

37:40  Question 6

Hi both,  Stumbled across your podcast recently and have been binging on the episodes ever since. Very insightful information for an early 30 something year old trying to make better financial decisions, so thank you!

My questions is: You often talk about paying off credit card debt before investing, but what if the credit card debt is not excessive and can be managed? What are your thoughts on paying off small amounts off your credit card monthly but also investing monthly, especially if returns on investing is potentially greater than the interest on the debt?

Thank you Nathaniel