The recent Budget outlined in principle, an historic shift in how people can take their pension fund at retirement. Before we look at the implications and (beyond the headlines) it's interesting to review the recent history of pensions in retirement.
Sir John Templeton, a ‘Hall of Fame Investor’ was asked to name the most dangerous belief an investor can have. He replied “this time is different.”
Malcolm Gladwell in his book "Blink" explains the role of intuition in human decision making. Humans have the ability to process information almost instantaneously and gain a read on a situation that’s often extremely accurate.
At the start of January investors could have been mistaken for thinking that 2014 was going to be a bumper year.
In my second blog on the budget announcement I want to explore further the perceived demise of annuities…..
According to most financial papers, the answer is yes……This means that companies like Just Retirement and Partnership Assurance are finished because this is the majority of their business. But perhaps the journalists and markets are overreacting.
The Charles Stanley basic package is good value, care needs to be taken where investors are considering adding a pension or even making regular investments into shares or investment trusts.
At some points the proposition is cheaper and certainly for investors with larger sums to invest (£100,000 plus) it offers better value. What you don’t get with Interactive Investor are the bells and whistles you receive from Hargreaves Lansdown.
The practice of investment however seems to me a much nobler and more thoughtful endeavour. It embraces economics, law, accountancy, politics, psychology and emotional intelligence so to do it well is to master much.
Over the last 18 months we have wondered whether many Hargreaves clients would feel slightly duped when it became clear that they had in fact been charged or whether they actually wouldn’t care.