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lse isnt allowing me to log on for some reason, i am gangstilla if you couldn't tell; fresh account
telecoms article starts by saying there have been various manouvers that groups have done such as 5g investment, buying other companies etc that may not have turned out too well " Telecom Italia and BT Group have both shored up their balance sheets to release cash for investment in new networks but their shares have not recovered. "
Earnings Telecoms is no longer a boom industry, meaning investors tend to focus on other metrics — cash flow, earnings and dividends — to judge progress. Price rises and painful restructurings over the past five years have delivered improvements for some large operators but analysts argue that companies need to be judged on return on capital employed — that is, whether they are creating value from the huge investments shareholders are funding.
Capex - long time to return capital investment Data - more consumption
As is with the whole market I'd say, unless you're certain, hold and at some point you're likely to see the money back
"Fleccy, do you think that the current pension arrangements are still an impediment to a complete separation of Open reach from BT?"
In my opinion, a BT/Openreach full separation is highly unlikely. I can't imagine Ofcom would initiate a full separation, as they made their decision previously and any policy change would open up cans of worms and lead to years of litigation between Ofcom, BT group and BTPS. Similar things might happen if BT was under threat of takeover, but that would open up another can of worms around national security. The only way I could see any changes, is if BT retained a controlling interest in Openreach and sold a minority stake, but even then the BTPS would probably have something to say
"Thanks all. The crown guarantee is pretty amazing."
Apparently the Crown Guaranteed BTPS has to pay Levies into the Payment Protection Fund, even though it's ineligible to claim against the PPF in the event that BT goes bust. BTPS was forced to pay into the PPF under EU competition and state aid rulings, after a complaint from a competitor. Who said the UK is sovereign under EU membership? As far as I can tell, the Pension was the main reason OFCOM didn't order a full separation of Openreach from BT, so it isn't all bad.
Also Kalps,that Hybrid pension is rubbish as you say..What most people overlook is the fact that it has a NRA of 65,which means if you are leaving early you lose quite a lot of what you have built up and as its only just started,its not worth bothering with.I still have my DC pension from Bt(run by Standard Life after the DB "c" scheme closed)) that I have not pulled Yet as it has a NRA of 55 so I have that to look forward to in 4 yrs or so.Good Luck..SM
Agreed NDN I am in "C" and the crown guarantee was worth its weight in gold.
Kalps....I have been retired 8 months now and pulled BT pension at 50 and I am on the "c" scheme.I looked at the transfer out of my pension from DB BT scheme but even thought the money looks attractive..I think mine was in the region of £440k I decided ,with this volatility and covid and money grabbing people/companys wanting you to transfer over a safe and secure index linked pension for life and spouse(halved for spouse)...that it was too much of a risk...to alleviate the half pension to the spouse if i died...I took the largest lump sum ,as that's ours/wife's money if i die(invested in premium bonds and safe stuff) and kept the safe pension...so it covers both options.I had AVC's too in pension "c" which bumped up my lump sum to a very nice figure...8 months retired and its the best decision I have ever made......Don't trust any financial advisers..they are all in it for a cut,and are playing with your money which can go down drastically if miss managed.Do your own extensive research..It took me about 6months in total to get to my decision.....just my take on it......SM
Indeed. I certainly would never put my pension on one sector alone that’s asking for trouble. In fact in a pension just to be in 1000 different shares globally and no other assets is seen by financial advisor as high risk.
The most important decision of m transferring out is the transfer out value and saying your risk profile even medium risk , some goes into Cash and govt gilts. You can chooose very low risk too which effectively is cash to preserve your pot.
But the most important thing is your current health, transfer out value and your financial advisor recommending you have suitable means to transfer out
I have transferred out of my BTPS to a private pension , it costs me 0.4% a year for the platform and 0.5% a year for my financial advisor to Do various stuff ie tax basically keeping an eye on it , what made me do it is my colleague retired a 60 in the BTPS with a pot around 550k and very sadly died suddenly 3 months into his retirement, his wife was entitled to half his pension 8k yearly and a lump sum of 16k , all the rest goes back into the pension and she would need to live to 112 to get the full benefit of the pension. I have researched deeply into this and was shocked at how many BT guys no nothing about the scheme. I know the risks and it has allowed me to retire a long time before my intended retirement day .
Personally, I'd be ultra cautious about transferring out of a company pension scheme and bank shares are no certain bet.
I should know I am in Lloyds and that has fallen to horrendous lows and had its dividend cancelled. Yes, they may not go bust, but they can still erode your capital.
Depending on your age, I would recommend a Life time ISA, you get the benefits of the 20% from government and you can invest as you choose, but its an added extra. If it all goes wrong you still have your works pension to back you up.
Just imagine you are in the year before retirement and then another shock hits the market wiping 25% off your pot. Suddenly you can't afford to retire and need to work an extra 10 years. It's a big risk to take.
One of the biggest benefits of transferring out is massive inheritance tax benefits
Ie a final salary pension will die with you and your spouse. Whereas a defined pot pension falls outside your estate when you die and effectively goes to whoever you wish tax free (up to the age of 75) it then starts to attract some inheritance tax.
A financial advisor won’t advice on what’s good value or not. All they will do and very few offer final salary pension transfer advice as cost of liability insurance is very expensive and basically you will be charged a lot to move a pot ie moving a final salary scheme to a gbp200k pot would cost minimum gbp5k just for the financial advisor to approve you. As basically they need to prove you can live in retirement with other means to approve you in transferring out.
As effectively you carry no investment risk in guaranteed final salary scheme but transferring out you then carry the investment risk. However the transfer out values are extremely attractive at moment as govt yields so low and that’s what determine the maths calculations on transfer out valuations. Ie that’s why they are as much as 50 times the final salary pension. I’ve transferred out couple of my partners final salary schemes just now into a self invested SIPP, but it was only allowed as other means to live on should that money go to zero under self investment
Good advice is important. Whilst economy is bad, you can make that wirk to your advantage by looking at transferring, which is one of the options you’re talking about, I’ve heard from friends offer could be 40+ times the defined pension payout
Are Wealth at Work, still doing pension seminars at BT. If so then I would seek there advice, it was a free consultation a few years ago. They look at your whole situation, savings, your goals, time left to your pension etc. They are totally independent.
Hi. It would depend on which scheme you are in. If it’s section B or C ( finally salary/ career average ) then you need to think very carefully as I would think it would be very difficult to match those benefits. If it’s one of the newer pensions then you really need expert independent advice.
Hi guys, just a quick question. Would any of you consider moving your pension to a SIPP? With the market below very low, would now be a good time to transfer out my BT pension, and invest it on some super low bank stock for example? I want to get a feel of what people think of the idea. Obviously I'll seek proper financial advice. Many thanks