Member Info for Bunky1981

Davie - correct. If you're already "through the gate" of 75 so to speak, then LTA is a non issue on death as it's not a Benefit Crystallisation Event. It won't help the beneficiaries' marginal tax rate issue of course, which could well be preferential with a FIC over a pension. I did assume that TMT was under 75 as he's gifting to kids, rather than grandkids. But that was an assumption on my part.

Then all of this is rather assuming that this stock is going to end up doing what we're all hoping it will do and become part of multi generational planning. I do love a good pension, but successive governments have been far too comfortable meddling with them. The current LTA freeze until 2026 is, in my opinion, a disgrace. Talk of flat rate tax relief on them is equally short sighted in my view. So I'd rather keep it all in a FIC where I (or my children/grandchildren) will choose the time and market position that I pay tax on the gains and withdrawals at our leisure... as opposed to being forced to adjust my financial planning to the whims of whoever's wallpapering 11 Downing St at the time.

Zoros - Absolutely! Even fewer people are aware that you can buy assets out of your pension. So if they're worried that they're going to breach LTA and are either uncrystallised or not yet 75, they may want to consider buying their pension out since 25% LTA charge followed by 20 or (more likely) 40% marginal rate income tax is actually a lot worse than a flat 40% IHT.

Is... is that a Dyson Airblade 5 sat in the middle of all that clever technical gear in the trailer?

FYI, for those that hold GGP in their SIPPS and are gifting to kids. Consider that pensions sit outside your estate for IHT. Also that Capital Gains die with you outside of a SIPP.

Many HNW individuals will be desperately NOT using their own pension to fund retirement, effectively treating it as a trust fund of sorts. Instead burning assets and or/even borrowing against main residence (yes, and paying the interest), for a preferential tax position. Family Investment Companies are great btw. Hopefully the Lifetime Allowance is the biggest problem we all face! :)

I can tell you with absolute confidence that the FCA would take a very dim view of any financial adviser who recommended that a client invest in a single micro cap stock. In fact I'd go as far as to say I hope that adviser would be struck off and never allowed to practice again. But that's mainly because most people have no idea what financial advisers do nowadays and are still (quite understandably) haunted by the memories of spivs in shiny suits going around flogging endowments and equity release for commission pre 2013.

A financial adviser should be looking at your attitude to risk, capacity for capital loss, income and expenditure needs, tax wrappers, IHT position, monte carlo modelling etc etc and only after all of that should they even start to talk about whether the actual underlying assets are appropriate.

A stockbroker, however, would be better suited for this question. Albeit a tongue in cheek rhetorical one :)

@ Kevin - Did you serously just make another new thread, to reply to another thread, where somebody queried why you kept making new threads? Brilliant :D

As for why somebody may have long posts about the value of divis on a share that is "some way" off producing one... well that's because it's relevant to the share. Specifically GGP.

Anyway, fortunately we're all on the same team here (assuming we're long GGP), so we can all move on with our day. Nice to see a little bounce today. Not that it matters for the LTH, but let's hope we can finish the week nearer 20p, if only because it looks nicer. ATB :)

but did you really have to start a thread on it? I'm really struggling to cut out all the boring noise that I see here more recently. But i have no idea why people feel the need to start an entire thread announcing to the world that they've blocked somebody. Can't you just... quietly filter them... instead of wasting everybody's time having to scroll through new threads?

Looks like it's back on your radar then! :)

In all seriousness, I wouldn't be at all surprised to see this drop below 160. It's a good company, but alot PI's would have taken their 5-10% gain from the IPO and gleefully run. That was the risk of them marketing it to all their customers. If somebody is using PBEE to manage their pension, then it's very unlikely that those same people have any real appreciation of individual stocks. So that will be impacting the SP a bit. but it seems the market is too impatient to wait for this to start turning the future profits that it could and probably will.

I'm holding out for 150 when new regulation comes in. The FCA has failed at the helm (as always) with British Steel and a number of other scandals. They'll do what they always do which is to shut the stable door now the horse has bolted with some draconian and ill considered new regulations that make PBEE's work certainly more costly. If only for their insurance.

I took my 7% gain and walked. I'll keep an eye on it though. I'd buy in again at 150. I think this is a solid business but there are easier and faster gains to be made elsewhere. Good luck to the holders.

@WelshFalcon - I was right about CGT being preferable to Divi tax though, wasn't I?

@Matty - Divis vs gains is (almost) purely down to whether you want profits paid out to you, or reinvested to increase the value of your stock. The flip side would be that if they do start paying a divi, I'd just use it to buy more stock... because I'm a growth investor, not an income investor. I don't want the money paid out. I'm still young-ish and earning a wage, so more income isn't of interest to me. However if they do pay a divi, I'd have to pay 38.1% divi tax (or 19% Corporation Tax as I also hold a lump of GGP via a Ltd company) on that before reinvesting it straight back into more GGP stock. So for every £100 of divi, I'm only going to get £62 of new stock. So I'd rather they didn't pay out the divi at all, kept that £100 in the company, and I'd (theoretically) see that £100 going into the SP instead, which is gross of tax. I then get rolled up growth, which leads to much higher overall growth. It's just a personal preference.

@Tig - I wasn't criticising divis per se. More that (as I feel is actually being evidenced in this thread) we have a cultural thing for dividends. There's something about getting paid a bit of cash every 6 months that makes us feel like we're winning. Even though it is just our own money being paid to us. I see it at work all the time. Typically with the older generations. They pass away leaving behind a box of utility company (and similar) share certificates because it "paid a good dividend". What they failed to ever look at was the miserable overall return they got for the last 40 years because they obsessed about divis. Where growth investors have made multiple higher returns, in what is now also now a significantly more preferential tax environment for gains. The same people that jump and down when they get £50 "for free" from their premium bonds, even though they don't realise that they've held an asset for 10 years with an annual return of about 1%. Meanwhile the MSCI world index is up 10% per year over the same period. That's all I was saying. I'm not... ante dividends (see what I did there). ps. As for the nations pension funds paying out. That's a perfect example of what I find so depressing about the FTSE. That they are all basically just owned by pension/investment funds, and rather than our 100 biggest companies actually growing and expanding each year to acquire, grow and develop on the global stage, they have a bunch of pension trustees march into the board room each year and bleed them dry for a divi, in exchange for not dumping their stock, to save their own skins. It's just my personal opinion on a conversation about dividends :)

@WelshFalcon - huh? CGT is 20% compared to Divis are 32.5% or 38.1%. That's a massive saving if you have CGT instead of divis. Not to mention that the personal allowance for CGT is £12.3k compared to a very modest £2k on divis. So the first £24.6k per year is tax free on CGT for a married couple anyway. CGT is by far the better option.... even for most basic rate tax payers where it's 7.5% vs 10% because the CGT isn't payable on the first £24.6k, whereas you'll be paying 7.5% on on £20k of that £24k giving you an avoidable £1.5k tax bill... if it were gains rather than divis. I think my adviser has is spot on, no?

@Sojourner - they do. I just feel that there's just a better growth culture there, than here. We're obsessed with divis. And I don't know why. If I want some of my profit to come out of a company, then why not just sell some of the shares. It's the same thing, but more tax efficient in almost every case. If you look for equity income funds, you'll find lots of the top hitters are UK-centric funds.

@Mattyboy - well obviously the tax comparison is only relevant if you're in a taxable wrapper. But what's the difference between a 3% divi as opposed to 3% growth? You could have £1m in stock that pays a £30k divi, or you could just not distribute that profit to shareholders and the stock would be worth £1.03m instead at which point you can sell the £30k for the same outcome?

@speedy - exactly. agreed.

I've never understood the UK's obsession with divis. Not only are they significantly less tax efficient than capital gains, but I always feel that you'd see greater overall returns if that profit were reinvested into the company for growth, like the yanks do. Given that their two major indices have nearly tripled since last century, while ours is pathetically flat over the same period, I've always wondered if we're doing it wrong. So for a company like GGP, I'd much rather they kept the profit and put it into expansion and growth. I'd prefer see my divi in the SP please. Personal view of course! :)

@RickEngland - As long as Nutmeg are still (somehow) trading... then PBEE looks positively loaded with cash. AUM are everything and investors will pour money in for years until it turns. Because once it does, it's massive margin stuff.

@GlenH - I'm astonished to hear that your pension is worth less than half of the total contributions after 20 years. I almost can't believe it. SJP are pretty rubbish and expensive, but they're not THAT rubbish. Are you absolutely sure you've got those figures correct?

When you say "I haven't had advice from SJP"... believe me, you have. You may not know it, or feel like it, but SJP have to give you advice in order to recommend the transfer to them. If the early exit penalty was not explained to you, then it sounds like pretty good grounds for a complaint to me. I'd rather not go into too much detail, because I don't know any of the details and we're just strangers on a forum. But I'm comfortable telling you that I've submitted a number of complaints to SJP on behalf of clients. Particularly with regards to their early exit penalties, which I think are a disgrace and something that should have been left behind in the 1900s. I've had every single one of those complaints upheld and SJP have "released" the pension without applying the charge. But I don't know your circumstances, so I can't comment on specifics. SJP are very precious about reputation though. They don't like people airing dirty laundry and seem quite happy to write a cheque to make people go away quietly.

As for the awful performance. I still just struggle to see how that's possible. Unless you are in an ultra defensive portfolio that has virtually no equities in it and high SJP charges. But even then... I'd expect it to be flat after 20 years, not halved! :/

@rossannan - I agree. They do seem to do about as much as can be asked to, to save us from ourselves. Certainly more than Hargreaves Lansdown and their ilk. I think the ethics of PBEE look solid. Hence why I'm pleased to be a shareholder.

ESG is, happily, a big factor now for the viability of a stock. Deliveroo tanking is a great example of wider forces at work. When a company's ethics are poor (how they treat their delivery drivers) it is no longer just about "woke" people not wanting to hold the stock. It means that major funds managers can't buy it either, as it jeopardises the credentials of the rest of their fund. ESG is so a la mode at the moment, that any stock with solid ESG credentials becomes very attractive to large fund managers and therefore puts the private investors in a great place. So I'm excited!

@DinkyDan - spot on. I'm also in the my 30s and our generation rarely have anything particularly interesting about modern pensions. Certainly if they're Defined Contribution anyway. The link that rossannan is useful. There are other benefits such as enhanced tax free cash (where your Pension Commencement Lump Sum is more than 25%) as well as other benefits.

I suppose the main thing is that Pension Bee just has a range of investment options that are really no different to the majority of your employer's pension scheme. However a company pension scheme is quite likely to cheaper since it's on a larger scale and often very difficult to beat on cost. So it's always worth checking your work scheme first. I'm constantly amazed by how many people don't even realise they can change or choose the funds within their work scheme and for a much lower cost than they could if they went to the same pension provider as a direct consumer. Bulk buying power!

However, pragmatically, the younger generations tend to change jobs every few years, as opposed to our forebearers who were typically more 'job for life' and also lived in a time of Defined Benefit (final salary) pensions where you didn't have to think about any of this. So for us, it's quite likely we've got 10 different pension pots by the time we're 40-50 and to realistically manage those properly, while having enough knowledge to know broadly which funds you should be looking at... just isn't that likely. That's where a service like Pension Bee comes in. Yes it has a premium to it. But for most people, being able to just pick a number on a risk scale and stick it all under one roof is highly attractive. So the vast vast majority of people could benefit from it.

One other thing to mention is that many employer pension schemes employ 'lifestyling'. This is a process where they lower the risk of your pension automatically as you approach 55-65. The idea being that you want to reduce volatility as you approach retirement as you'll being buying an annuity. Of course nobody has bought annuities really since the banking crisis as the rates are awful, and now taking your money as drawdown (leaving it invested in retirement while you skim the growth off the top for your income) is very much the norm. So I find it bizarre that Lifestyling is still endemic because why would you want to reduce your risk with 30 years of retirement ahead of you. But employer schemes have Trustees. And those Trustees are (quite rightly) more concerned with not getting it wrong, rather than getting it right. Another reason to consider 'taking control' of the investment strategy of your previous pensions.

Hope some of that helps :)

@Rossannan - Oh I agree. I feel like I've come across as negative about PBEE. That really wasn't my intention. The fact you've even read the FAQ puts you ahead of the majority of consumers.

Anyway, we're all here to rejoice in the success of what (so far) looks like a shrewd investment on our part. So I'll stop sounding so miserable and just enjoy the ride. ;)

@DinkyDan

I didn't mean to infer they were being frivolous. But of course they will take all and any pensions that they can to generate fees, within the regulatory framework. Nothing wrong with that either. They're a business.

I wasn't referring to DB pensions. I work in the sector and have a very good understanding of pensions. I don't mean that sound aloof, just simply to say that I do understand this stuff. There are many potential benefits that you can lose with an execution only transfer and you would never even know you lost them.

In addition, the Ombudsman has made it very clear to the entire advice sector that 'ease of administration' and 'consolidation' are absolutely NOT good enough grounds alone to combine your pension pots. Even less so unless there is a material benefit in charging. So moving a load of old work pensions that are typically 0.2-0.4% into PensionBee at double the cost... would be very unlikely to pass as compliant financial advice. That's all I'm saying. There's nothing nefarious about it. It's simply 'buyer beware'. No different to people who buy life insurance from a Meerkat and have absolutely no idea that unless it's placed in Trust it will form part of their estate and be liable to 40% inheritance tax on death. Of course they'll be dead before their kids find that out.

All I meant by my original comment was to highlight that comparing an execution only platform to a (admittedly awful) financial advice company is just not a correct comparison. Of course Pension Bee is "easy and straight forward" by comparison. There's only a fraction of the due diligence and consumer protection by using them. So it's bound to be. That was my only point.

@Rossanan - I'm a shareholder and a customer of theirs. I used them to try and find a few £k of old pensions for my early 20s that I couldn't be bothered to do that admin on. Mostly unsuccessful I might add. But I think their offering is great and I have no doubt that they'll be very successful and a broadly good thing for the pension space. Hence why I bought into the IPO :)

mine arrived today

@GlenH

Just someting to clarify about PensionBee. They are execution only. It's a very important distinction and I'm still amazed by how many people don't realise that. In plain language, that means that any benefits you may lose by transferring to them is your fault. Any flaws in the wisdom of the transfer, it's all on you.

I wouldn't recommend my worst enemy to Saint James Place... but you are least protected from poor advice as you can complain to them about it, and then ultimately the FOS if you so wish. You have no such option with PensionBee.

I think PBEE are a great company, and the reason they are doing so well is because they do not suffer the expensive barrier to entry that insured financial advice does. So they can just set up a simple and cheap website to hoover up assets without any real risk. Commerically, it's fantastic. Hence why I've happily taken part in the IPO. They're a great business and I wish them, their customers and their shareholders the best of luck. I'm excited for their future.

The reality is that you'd get a much cheaper similar service (about half the cost in fact) from Royal London, Scottish Widows, Vanguard and many more. PensionBee are expensive and they're not really asset managers. But they've marketed very well and their website is simple and easy to use. the process is very slick. So the punters love it. I think they offer a great service and are a positive for the industry.

ps. I'm surprised to hear your SJP assets were "losing money every year". they're rubbish funds... but not so rubbish that they lose ground every yeaer. I also assume you were outside their exit penalty of 6 years and that you did check whether that would apply in the event that you transferred to PBEE? I've seen plenty of cases of SJP pensions being transferred execution only to providers without the customer knowing that there's a painful penalty. May be worth checking that SJP didn't make any errors if your balance was going down every year. Just a friendly bystander :)

@Jaguar

Makes sense. With my finger hovering over the 'buy' button all day to get under 23.5.... it was bound to be 23.4 ;)

Have a good weekend all.