Brilliant video (as usual). I love how clear it is to understand for one and all. (like moi). I will not be able to put in £1,000 a month even with side hustles etc at the moment HOWEVER 1 day I might be able to but I am 51 so I don't have the luxury of loads of time.!! But I believe if you put in what you have say £100 one month and £300 another month etc it all adds up and compounds etc and is better than I started with. I will look more into VCTs (will watch your video again) as part of my portfolio. Thank you for all your hard work and information.
Spot on with your comment as ever Anita - whatever you can afford to invest will put you in a better position in the future than not investing at all. It takes discipline to invest more when you have more rather than just spending it, but you are rewarded for that. Thanks as always for watching!
Thanks for the video Chris. A log of good info as always. This video is what I needed. I have heard about VCT but never understood how it works or how to get started. Do you mind if I email you my personal circumstances? @@chrisbourne-retirementplanner
Nice video, Chris. We all need a bit of realism when thinking about our wealth. Enjoyed this one, plenty of scope out there to make more income if you have the real desire. Can't save your way to wealth.
Vct. That's an interesting one ( no pun intended) I must add though, that nobody( including you) factors in any charges and fees into those figures shown in all the online video content. I asked my ifa for a retirement drawdown illustration of their typical annual costs taken from my pot. Over £40, 000 in total. Gulp.
Great video - definitely something worth looking into if I'm thinking of putting some money into a higher growth company , a VCT might be a better alternative to a SIPP with the tax relief and a 5 year horizon.
Thanks Roger. I’d say one doesn’t replace the other due to the ability to hold lower risk and globally diversified assets in a SIPP, but both are useful!
@@chrisbourne-retirementplanner I munged what I meant there ... more a small proportion of a larger portfolio that includes an established SIPP of global trackers and funds, I might choose to invest in a VCT rather than a more speculative AIM , small cap stock directly within that already larger SIPP.
Hi Mike. Thanks for your comment. I’m not sure I know enough about banking in Malta to do a video on the subject. Generally though, the potential considerations are currency fluctuation risk and investor protection… is your money protected as well as it would be in a UK bank?
Great video as per usual Chris. I've been investing in VCT's for a number of years now and have an ISA, SIPP and general investment account with Interactive Investor. The prospect of 20k per year tax free sounds great and makes for clickbait type title for the video, but my approach is as you mentioned briefly to continue to build wealth for my retirement and children
Chris I'm 55 in May been a starving artist (martial) most my adult life making approx 5/6k a year got no mortgage My pension worth only 40k What's the best thing for me to do sir? It all sounds scary to me I'd like a van for another string to my bow (man with a van) Should I just take the tax hit draw the lot and help with my bills or try invest? Hairy scary when you know nothing
Hi Glen. Thanks for your message. It’s a difficult one, but I think with those level of earnings it is hard to justify investing. I think it is important to focus on increasing those earnings so that you can be sure of affordability, then make investing the next priority.
Hi Jason. I would urge caution. Not all VCTs are created equal and some are far higher risk than others. The biggest VCT for example, Octopus Titan, is huge compared to most new VCT providers and has been running a long time, so it has holdings in companies that are now well established (which it can still add to) and would not be available to new VCTs. It still carries some of the specific VCT risks, but is more diversified. You have to be aware of the risks of different VCTs before entering into them. Many VCTs are not open all of the time either - they open up for investment ‘tranches’ a couple of times a year. You can subscribe for notifications of when tranches open though.
Should one keep dividend paying stocks in their general investment account to use the £2000 a year tax free limit rather than in an ISA? Or doesn’t it really matter
Hi Chris very informative and clear videos thank you Can I ask a question I can’t find an answer to its off topic of this video though. I believe the annual allowance yourself and your company can pay into a pension is 40k before tax relief stops. I have some spare funds and was planning on using that to live off and paying more into my avc pension. Currently it’s 28k a year and was wondering if I go over the 12k to take it over 40k there is a carry forward from the previous 3 years if they didn’t go up to 40k to use. 2 questions really Does the carry forward get sorted automatically for example if I put 20 k into my pension would it automatically do the carry forward or would I need to claim back from hmrc and secondly if I purposely wanted to go over 40k and I had no carry forward would I not only lose the tax relief for that year but also get taxed on putting money into the pension.
Hi Scott. You don’t have to do anything extra to get the carry forward relief - you just need to ensure that your earnings can substantiate the contribution (I.e. if you’re paying £50k in you need to be earning £50k). If you exceed your allowable contribution, any tax relief would need to be repaid, but you don’t pay tax on the contribution going in. Not getting any tax relief at all makes pension contributions unattractive though, because you’d have to pay tax on money you take out.
At 53, i think too late to really have a financially high retirement. Yes i have a pension but neglected it, but will be in a position from april to invest in something of which not sure around £400pcm. And yes i know with my personal situation wont be able to retire until at leat 65..any ideas?
It’s a good idea to start with whatever you can afford no matter what age Mark, especially when there is tax relief available like there is with pensions. A lot can be achieved in 10 years.
What about the fees on a VCT? Looking at Octopus they charge 3% up front, 2% per year and then a 20% performance fee - and that's before you pay an advisor! This would eat into any returns especially compounded over a 15 year period, which I don't think is taken into account in the video?
Yes fees on a VCT are higher than a conventional unit trust or oeic. It’s a specialist area and quite often when a VCT like Titan backs a company they take quite an active role in that company’s growth and development, hence the performance fee aspect and higher AMC. It comes down to whether you think you can get value for the fees being paid. VCTs are higher risk and are highly specialist, so shouldn’t be compared side by side with conventional investment funds.
Any figure would always be the target net of costs, but no figures are guaranteed of course. We can’t really know whether any estimates will turn out to be accurate in the long run. We can only really base it on what we’ve seen, and then remove a certain amount to err on the side of caution. Even then, we may overshoot it!
It would reduce its purchasing power Clive. The spectre of inflation should encourage people to invest though - stocks will generally provide the best hedge against it. Some sectors may benefit from it as well.
Great video Chris! My personal frustration with trying to earn extra from side hustles is that I'm doing well - £1,300 a month as an illustrator on top of my day job as a designer (employee) salary. But I'm struggling to get my hands on that much of the side hustle money to put it to use. My side hustles are through my limited company that I set up when I use to freelancer. My accountant tells me that because I have to repay Child Benefit (earning over £50,000 a year) and also my tax band, it means beyond taking £2,000 in dividends, I would probably only see about £400 out of every £1,000. For the time being I'm just leaving the money in my business bank account rather than taking it as salary/further dividend. Is there any way I can be putting this money to work rather than just leaving it sitting there? By the way I'm in my late 40s if that's of any significance.
Hi Nick. Yes it certainly is possible for your company to invest money in offshore investment bonds and general investment accounts, but perhaps more significantly first it can invest into a pension for you personally.
I can only make specific fund recommendations to clients, but a market cap weighted global fund is always a good core holding. It’s probably more like that other parts of the world will produce higher returns than the US over the next decade though, so perhaps worth reflecting this in any strategy.
Certainly hasn’t been my experience Andrew. Fund costs are undoubtedly higher, but that’s because the managers often take an active roll in helping some of the fledgling companies grow. In the best VCTs, long term growth has been very strong and the benefit of tax free dividends and gains is huge. All VCTs are not equal though, so it’s important to do plenty of research.
Ha! Unfortunately, getting that kind of income from investments in a short time frame won’t be possible without finding a way to generate that sort of extra income. For some people it’s easier than others, but it’s never impossible.
Maybe a video coming clean on explaining and clarifying ( or justifying) costs and fees which investors might end up paying ?
Good idea ?
Thanks. Found your channel as now looking at pension access. Subscribed.
Thank you. Hope the info helps.
Brilliant video (as usual). I love how clear it is to understand for one and all. (like moi). I will not be able to put in £1,000 a month even with side hustles etc at the moment HOWEVER 1 day I might be able to but I am 51 so I don't have the luxury of loads of time.!! But I believe if you put in what you have say £100 one month and £300 another month etc it all adds up and compounds etc and is better than I started with. I will look more into VCTs (will watch your video again) as part of my portfolio. Thank you for all your hard work and information.
Spot on with your comment as ever Anita - whatever you can afford to invest will put you in a better position in the future than not investing at all. It takes discipline to invest more when you have more rather than just spending it, but you are rewarded for that. Thanks as always for watching!
Thanks for the video Chris. A log of good info as always. This video is what I needed. I have heard about VCT but never understood how it works or how to get started. Do you mind if I email you my personal circumstances? @@chrisbourne-retirementplanner
Thank you, straight on to the VCT video….
You’re welcome Gary 👍🏼
Nice video, Chris. We all need a bit of realism when thinking about our wealth. Enjoyed this one, plenty of scope out there to make more income if you have the real desire. Can't save your way to wealth.
Spot on David. Nobody ever became rich by saving into a bank account! Thanks as always for watching 👍🏼
The banks got rich!
Vct. That's an interesting one ( no pun intended)
I must add though, that nobody( including you) factors in any charges and fees into those figures shown in all the online video content.
I asked my ifa for a retirement drawdown illustration of their typical annual costs taken from my pot.
Over £40, 000 in total.
Gulp.
Great into! I'm sure pumped to find out how!
Thanks Dafydd! I hope it was useful information for you.
@@chrisbourne-retirementplanner indeed. Your expertise comes through clearly. 💪
I love the bit about being creative with increasing your income. 👍
I love love watching your videos,you give so much valuable informations thank you
Ah you’re welcome! Getting great comments like this is what keeps me going 👍🏼
Great video as always Chris, some great information and ways to generate income.
Will definitely check out a few of those options 👍🏼
Thanks Steve. Hope some of them are helpful to you! These extra bits of income will add up 👍🏼
Great video - definitely something worth looking into if I'm thinking of putting some money into a higher growth company , a VCT might be a better alternative to a SIPP with the tax relief and a 5 year horizon.
Thanks Roger. I’d say one doesn’t replace the other due to the ability to hold lower risk and globally diversified assets in a SIPP, but both are useful!
@@chrisbourne-retirementplanner I munged what I meant there ... more a small proportion of a larger portfolio that includes an established SIPP of global trackers and funds, I might choose to invest in a VCT rather than a more speculative AIM , small cap stock directly within that already larger SIPP.
Chris could you do segment on banking in Europe in Malta the taxi invocations the pros and the cons
Hi Mike. Thanks for your comment. I’m not sure I know enough about banking in Malta to do a video on the subject. Generally though, the potential considerations are currency fluctuation risk and investor protection… is your money protected as well as it would be in a UK bank?
Great video as per usual Chris. I've been investing in VCT's for a number of years now and have an ISA, SIPP and general investment account with Interactive Investor.
The prospect of 20k per year tax free sounds great and makes for clickbait type title for the video, but my approach is as you mentioned briefly to continue to build wealth for my retirement and children
Thank you I’m really pleased you enjoyed it. That’s my approach too! Why stop at 20k I say 😊
Chris I'm 55 in May been a starving artist (martial) most my adult life making approx 5/6k a year got no mortgage
My pension worth only 40k
What's the best thing for me to do sir? It all sounds scary to me
I'd like a van for another string to my bow (man with a van)
Should I just take the tax hit draw the lot and help with my bills or try invest?
Hairy scary when you know nothing
Hi Glen. Thanks for your message. It’s a difficult one, but I think with those level of earnings it is hard to justify investing. I think it is important to focus on increasing those earnings so that you can be sure of affordability, then make investing the next priority.
Incredibly interest in these VCTs. Do I literally just buy shares in some VCT? Do you know the names of any VCTs that would qualify?
Hi Jason. I would urge caution. Not all VCTs are created equal and some are far higher risk than others. The biggest VCT for example, Octopus Titan, is huge compared to most new VCT providers and has been running a long time, so it has holdings in companies that are now well established (which it can still add to) and would not be available to new VCTs. It still carries some of the specific VCT risks, but is more diversified. You have to be aware of the risks of different VCTs before entering into them. Many VCTs are not open all of the time either - they open up for investment ‘tranches’ a couple of times a year. You can subscribe for notifications of when tranches open though.
@@chrisbourne-retirementplanner Appreciate the response. How would you go about selling after 5 years?
Should one keep dividend paying stocks in their general investment account to use the £2000 a year tax free limit rather than in an ISA? Or doesn’t it really matter
Hi Emile. If it’s possible to get them in an ISA it’s better as this shelters them from potential CGT on any future sale.
Hi Chris very informative and clear videos thank you
Can I ask a question I can’t find an answer to its off topic of this video though.
I believe the annual allowance yourself and your company can pay into a pension is 40k before tax relief stops. I have some spare funds and was planning on using that to live off and paying more into my avc pension. Currently it’s 28k a year and was wondering if I go over the 12k to take it over 40k there is a carry forward from the previous 3 years if they didn’t go up to 40k to use. 2 questions really
Does the carry forward get sorted automatically for example if I put 20 k into my pension would it automatically do the carry forward or would I need to claim back from hmrc and secondly if I purposely wanted to go over 40k and I had no carry forward would I not only lose the tax relief for that year but also get taxed on putting money into the pension.
Hi Scott. You don’t have to do anything extra to get the carry forward relief - you just need to ensure that your earnings can substantiate the contribution (I.e. if you’re paying £50k in you need to be earning £50k).
If you exceed your allowable contribution, any tax relief would need to be repaid, but you don’t pay tax on the contribution going in. Not getting any tax relief at all makes pension contributions unattractive though, because you’d have to pay tax on money you take out.
At 53, i think too late to really have a financially high retirement. Yes i have a pension but neglected it, but will be in a position from april to invest in something of which not sure around £400pcm. And yes i know with my personal situation wont be able to retire until at leat 65..any ideas?
It’s a good idea to start with whatever you can afford no matter what age Mark, especially when there is tax relief available like there is with pensions. A lot can be achieved in 10 years.
@@chrisbourne-retirementplanner but what in? Top up my pension, Vanguard pension, premium bonds? Little unsure?
What about the fees on a VCT? Looking at Octopus they charge 3% up front, 2% per year and then a 20% performance fee - and that's before you pay an advisor! This would eat into any returns especially compounded over a 15 year period, which I don't think is taken into account in the video?
Yes fees on a VCT are higher than a conventional unit trust or oeic. It’s a specialist area and quite often when a VCT like Titan backs a company they take quite an active role in that company’s growth and development, hence the performance fee aspect and higher AMC. It comes down to whether you think you can get value for the fees being paid. VCTs are higher risk and are highly specialist, so shouldn’t be compared side by side with conventional investment funds.
@@chrisbourne-retirementplanner Were the fees taken into account for the projections in the video?
Any figure would always be the target net of costs, but no figures are guaranteed of course. We can’t really know whether any estimates will turn out to be accurate in the long run. We can only really base it on what we’ve seen, and then remove a certain amount to err on the side of caution. Even then, we may overshoot it!
what about the effect of inflation on the purchasing power of 20k many years down the road?
It would reduce its purchasing power Clive. The spectre of inflation should encourage people to invest though - stocks will generally provide the best hedge against it. Some sectors may benefit from it as well.
Great video Chris! My personal frustration with trying to earn extra from side hustles is that I'm doing well - £1,300 a month as an illustrator on top of my day job as a designer (employee) salary. But I'm struggling to get my hands on that much of the side hustle money to put it to use.
My side hustles are through my limited company that I set up when I use to freelancer. My accountant tells me that because I have to repay Child Benefit (earning over £50,000 a year) and also my tax band, it means beyond taking £2,000 in dividends, I would probably only see about £400 out of every £1,000.
For the time being I'm just leaving the money in my business bank account rather than taking it as salary/further dividend. Is there any way I can be putting this money to work rather than just leaving it sitting there? By the way I'm in my late 40s if that's of any significance.
Hi Nick. Yes it certainly is possible for your company to invest money in offshore investment bonds and general investment accounts, but perhaps more significantly first it can invest into a pension for you personally.
@@chrisbourne-retirementplanner Thanks Chris! I'll investigate that further.
Would you recommend any funds or a global fund for both isa and pension?
I can only make specific fund recommendations to clients, but a market cap weighted global fund is always a good core holding. It’s probably more like that other parts of the world will produce higher returns than the US over the next decade though, so perhaps worth reflecting this in any strategy.
Vwrl or ftse global all cap is a safe bet I reckon buddy.
Too late to start at 42 do you think?
Hi Chris. No it’s not too late to start putting money aside for your retirement. Starting today is always better than starting tomorrow!
The vct tax relief is eaten up by the fund costs in the long run
Certainly hasn’t been my experience Andrew. Fund costs are undoubtedly higher, but that’s because the managers often take an active roll in helping some of the fledgling companies grow. In the best VCTs, long term growth has been very strong and the benefit of tax free dividends and gains is huge. All VCTs are not equal though, so it’s important to do plenty of research.
£1k per month!🤣 Can I get rid of my Mrs and kids…?
Ha! Unfortunately, getting that kind of income from investments in a short time frame won’t be possible without finding a way to generate that sort of extra income. For some people it’s easier than others, but it’s never impossible.
thank you for reply to me ref my crypto
You’re welcome Mike 👍🏼 Hope it was helpful.