Things appear strange right now. The value of the US dollar is declining due to inflation, but it is increasing in comparison to other currencies and commodities such as gold and real estate. People are flocking to the dollar because they believe it is safer. As someone with a £401k retirement fund, I'm concerned about the impact of inflation ony savings
Absolutely, retirement planning is about more than just reaching a specific financial milestone. It's about figuring out how to generate income, manage expenses, and maintain your desired standard of living throughout your retirement years.
My portfolio has been going down the drain while I try trading, I just don't know what to do, Catherine is there anyway I can reach your financial advisor?
Has anyone started combining these market ratios with crypto data? Ive always felt like i could see the future of stocks by watching btc. I rarely pay attention to the stock market but I keep my eye on bitcoin whie actively trading all the time and I always find myself saying well this is different right before something big happens in the stock market. I give Bitcoin credit for the soft Landing. Not the Federal Reserve....I've engaged in active trading and managed to grow a nest egg of around 2.3Bitcoin to a decent 24Bitcoin....At the heart of this evolution is Linda Wilburn, whose deep understanding of both cryptocurrency and traditional trading has been instrumental. Her holistic approach to investment and commitment to staying abreast of market trends make her an invaluable ally in navigating this new era in cryptocurrency investment.
Excellent, thorough video. New subscriber. I haven't checked out your other videos yet, but it may be a good idea to split the topics in this into three videos 1. Overview of contribution to pension and tax relief 2. Withdrawal options 3. Inheritance planning with pensions
So £2880 in, tax relief on it (even though you don’t pay tax) and they give you 25% on top £720 tax relief. Excellent! And take it out the next day as long as you are under the tax allowance limit.
Some really interesting and important stuff here, but the inability to turn off the subtitles, which, due to the blue blocking of words causes flashing, means I'm not able to watch this. Such a shame as I assume the intention was to make it accessible rather than the opposite.
Apologies that you found the embedded captions a challenged. We'll take a look in to it. Are there any other colours for highlighting words that are less problematic for you?
Never seen anybody mention this before. from age 65 to 75 ( 10 years) pay in £28,800 and get 36,000 ( 7,400 profit ) By age85 that 36 k is 80k with normal 8% return from SP500.
The only fly in the ointment is that the tax limit not moving means everyone will be paying tax. The full state pension will run over the limit as it goes up and the tax band stays still. Works if you are retired pre pension but earn under the limit, but that is not a lot to live on. Take care M.
You're absolutely correct. The flat rate state pension may well increase to more than the personal allowance (currently £12,570 in 2024). However, a withdrawal strategy before state pension starts *might* enable tax free withdrawals from pensions using up personal allowance. This is currently an option for people in the 55 (57) - 67 age range who can withdraw tax efficiently if they have no other taxable income. Minimum pension age increases to 57 in April 2028
If no pensions payments have been made in previous years, can any of the unused previous year's pension allowance be used? For instance does that mean that in the first year it would be possible to use this year's and the previous 3 years allowance, paying in (£2,880 * 4 ) £11,520 to have the government contribute (£720 * 4) £2,880 in that first year?
Apparently not possible if you were not in a pension scheme in that prior 3 years. Also if not actually earning more that £3600 that's all you can do even if you have available carry forward allowance 😞
That's correct. In order to utilise unused carry forward from previous years you need to max out the current year. The annual allowance limit is 100% of relevant earnings (capped at £60,000) or £3,600, whichever is highest.
@@PropositoFPIt’s the white text on the bottom of the screen with the jumping blue highlight. I know it emphasises what you’re saying… but is it really necessary? YT has its own caption system that people can turn on if they need it… it’s not necessary to bake it into the video.
Question: if a person becomes a non UK tax resident (i.e moved abroad), does this person loose the 25% tax relief from the personal/workplace pension when it comes to withdraw from the pension pot? In other words, will the whole pot 100% be taxable (i.e. without the 25% tax free)?
Great question. A bit of digging around it seems that PCLS is free of income tax in the UK, but *could* be taxable in the country of residence. Getting professional tax advice in the country of residence would be essential before taking any action
Hi PFP great video my dad as just started a dipp with vanguard he's 74 !! I know a bit late he's put the £2880 in and got £720 tax relief. What we was wondering is how does he pay the tax when he draws the money out? He only gets the state pension and a small private one about £300 pm. Also I few subjects for future videos, starter rate savings allowance and basically all allowances to save you tax and how does compound interest work with pensions IE how does the dividend payments go in.
When he's started to withdraw income (as opposed to PCLS) HMRC will apply a tax code to his pension withdrawal (just like payroll when employed). His tax code will take account of his personal allowance as well as other taxable income (state pension, other pension, etc). Hope that helps
Hi mine is currently taxed at 40% on my small DB pension even though I earn under the higher threshold. A bad savings scheme in which I get no interest provided by HMRC…… Take care M.
It might be worth a call to HMRC. Their phone lines can be a bit hit and miss but you should be able to make some progress. You shouldn't be paying higher rate tax if you're a basic rate or non-tax payer. If you've overpaid they should be able to amend your tax code with your DB pension to "refund" the overpaid tax. Top tip call as soon as their lines open - it's much less busy that a bit later in the day
What’s the point if you need to pay tax on your pension when you take it out ? I assume this is only a benefit if your income is zero from a pension ie living off savings in an isa or bank account , and have spare cash to put into a pension …. Can’t imagine your average Joe being in that position.
It's currently a 6.25% return for a basic rate tax payer. 20% return for an non tax payer. I agree that not everyone has the resources to take advantage though
Hi, governments change and so do the rules and ideas. Now Ricky wants tax to go up with the pension but only for pensioners from next year 2025. Eventually costing 2.5 billion. Just shows how much tax pensioners will be paying, all because they are not moving the tax band thresholds. Take care M.
@@markeh1971 Not a good investment vehicle if they can change the rules on a daily basis. They could tax it at whatever rate . Make you wait till 80 or all manor of things . Private pensions are Toxic.
Things appear strange right now. The value of the US dollar is declining due to inflation, but it is increasing in comparison to other currencies and commodities such as gold and real estate. People are flocking to the dollar because they believe it is safer. As someone with a £401k retirement fund, I'm concerned about the impact of inflation ony savings
Absolutely, retirement planning is about more than just reaching a specific financial milestone. It's about figuring out how to generate income, manage expenses, and maintain your desired standard of living throughout your retirement years.
I agree to successful on investment. Having an investment advsor is the best way to go about the stock market..
My portfolio has been going down the drain while I try trading, I just don't know what to do, Catherine is there anyway I can reach your financial advisor?
Has anyone started combining these market ratios with crypto data? Ive always felt like i could see the future of stocks by watching btc. I rarely pay attention to the stock market but I keep my eye on bitcoin whie actively trading all the time and I always find myself saying well this is different right before something big happens in the stock market. I give Bitcoin credit for the soft Landing. Not the Federal Reserve....I've engaged in active trading and managed to grow a nest egg of around 2.3Bitcoin to a decent 24Bitcoin....At the heart of this evolution is Linda Wilburn, whose deep understanding of both cryptocurrency and traditional trading has been instrumental. Her holistic approach to investment and commitment to staying abreast of market trends make her an invaluable ally in navigating this new era in cryptocurrency investment.
Excellent video Huw. Clearly explained, and without the machine gun approach used by other YT channels. Thanks.
Thank you for your kind words. It's very much appreciated
Excellent, thorough video. New subscriber. I haven't checked out your other videos yet, but it may be a good idea to split the topics in this into three videos 1. Overview of contribution to pension and tax relief 2. Withdrawal options 3. Inheritance planning with pensions
Great suggestion. Thank you
This video has just proved to me that I haven’t got a clue about pensions!
If I could do a pensions - start here video what would you like it to include?
Excellent video thanks. I've long wondered why my IFA recommended stocks and shares ISA instead of a pension. This confirms what I was thinking.
Glad it was helpful!
So £2880 in, tax relief on it (even though you don’t pay tax) and they give you 25% on top £720 tax relief. Excellent! And take it out the next day as long as you are under the tax allowance limit.
Not quite. The £720 is the 25% tax relief.
Some really interesting and important stuff here, but the inability to turn off the subtitles, which, due to the blue blocking of words causes flashing, means I'm not able to watch this. Such a shame as I assume the intention was to make it accessible rather than the opposite.
Apologies that you found the embedded captions a challenged. We'll take a look in to it.
Are there any other colours for highlighting words that are less problematic for you?
Never seen anybody mention this before. from age 65 to 75 ( 10 years) pay in £28,800 and get 36,000 ( 7,400 profit ) By age85 that 36 k is 80k with normal 8% return from SP500.
The only fly in the ointment is that the tax limit not moving means everyone will be paying tax. The full state pension will run over the limit as it goes up and the tax band stays still.
Works if you are retired pre pension but earn under the limit, but that is not a lot to live on.
Take care M.
You're absolutely correct. The flat rate state pension may well increase to more than the personal allowance (currently £12,570 in 2024). However, a withdrawal strategy before state pension starts *might* enable tax free withdrawals from pensions using up personal allowance.
This is currently an option for people in the 55 (57) - 67 age range who can withdraw tax efficiently if they have no other taxable income. Minimum pension age increases to 57 in April 2028
If no pensions payments have been made in previous years, can any of the unused previous year's pension allowance be used? For instance does that mean that in the first year it would be possible to use this year's and the previous 3 years allowance, paying in (£2,880 * 4 ) £11,520 to have the government contribute (£720 * 4) £2,880 in that first year?
Apparently not possible if you were not in a pension scheme in that prior 3 years. Also if not actually earning more that £3600 that's all you can do even if you have available carry forward allowance 😞
That's correct. In order to utilise unused carry forward from previous years you need to max out the current year. The annual allowance limit is 100% of relevant earnings (capped at £60,000) or £3,600, whichever is highest.
The busy caption is really distracting, got to say.
Thanks for. the feedback. Are you able to let me know the exact issue with " the busy caption" so I can take a look? Thanks
@@PropositoFPIt’s the white text on the bottom of the screen with the jumping blue highlight. I know it emphasises what you’re saying… but is it really necessary? YT has its own caption system that people can turn on if they need it… it’s not necessary to bake it into the video.
Agreed. It would be good to not have the moving colours in the writing, in an otherwise excellent video.
Agree with both comments, putting that to one side, a very informative and and interesting video, it’s give me much food for thought
Thank you for taking the time to clarify. It's something we're now looking in to - we weren't aware it was an issue for some viewers.
Tried to turn off those annoying captions but they're not optional. I do pay into a SIPP and am retired.
Question: if a person becomes a non UK tax resident (i.e moved abroad), does this person loose the 25% tax relief from the personal/workplace pension when it comes to withdraw from the pension pot? In other words, will the whole pot 100% be taxable (i.e. without the 25% tax free)?
Great question. A bit of digging around it seems that PCLS is free of income tax in the UK, but *could* be taxable in the country of residence. Getting professional tax advice in the country of residence would be essential before taking any action
Hi PFP great video my dad as just started a dipp with vanguard he's 74 !! I know a bit late he's put the £2880 in and got £720 tax relief.
What we was wondering is how does he pay the tax when he draws the money out? He only gets the state pension and a small private one about £300 pm.
Also I few subjects for future videos, starter rate savings allowance and basically all allowances to save you tax and how does compound interest work with pensions IE how does the dividend payments go in.
When he's started to withdraw income (as opposed to PCLS) HMRC will apply a tax code to his pension withdrawal (just like payroll when employed). His tax code will take account of his personal allowance as well as other taxable income (state pension, other pension, etc). Hope that helps
Hi mine is currently taxed at 40% on my small DB pension even though I earn under the higher threshold.
A bad savings scheme in which I get no interest provided by HMRC……
Take care M.
It might be worth a call to HMRC. Their phone lines can be a bit hit and miss but you should be able to make some progress. You shouldn't be paying higher rate tax if you're a basic rate or non-tax payer. If you've overpaid they should be able to amend your tax code with your DB pension to "refund" the overpaid tax. Top tip call as soon as their lines open - it's much less busy that a bit later in the day
What’s the point if you need to pay tax on your pension when you take it out ? I assume this is only a benefit if your income is zero from a pension ie living off savings in an isa or bank account , and have spare cash to put into a pension …. Can’t imagine your average Joe being in that position.
It's currently a 6.25% return for a basic rate tax payer. 20% return for an non tax payer. I agree that not everyone has the resources to take advantage though
Look at Serps . The last thing you want to do is trust the Government with your pension.
Hi, governments change and so do the rules and ideas. Now Ricky wants tax to go up with the pension but only for pensioners from next year 2025. Eventually costing 2.5 billion. Just shows how much tax pensioners will be paying, all because they are not moving the tax band thresholds.
Take care M.
@@markeh1971 Not a good investment vehicle if they can change the rules on a daily basis. They could tax it at whatever rate . Make you wait till 80 or all manor of things . Private pensions are Toxic.
2 months on who is waiting in trepidation at Labour changing all this for the worse?
Good video though.
what a stupid state of affairs.