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Irelander

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About Irelander

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  1. Congratulations, I am one of the 5,000 after reading about it through there (bought my copy as a Kindle edition), although I would have thought you would sold more copies than that. Do you mind me asking, has writing the book opened any doors for you, as you're hardly rolling in the dough from sales? I have been thinking of doing something similar, many as a way of boosting my profile more than anything. Cheers!
  2. Did you write that yourself? Possibly the best rant I have ever read of these forums. Bravo, sir
  3. Irelander

    Pension Gamble

    I don't see a real problem for you. Between yourself and your wife, the state pension and Tesco dividend income; that should provide just enough to keep an oldish car on the road, put food on the table and provide a holiday once a year, assuming you don't have extravagant tastes. Reports published by the government show that the median pensioner household will be in about the same position as you are - http://research.dwp.gov.uk/asd/asd6/2009_10/pi_series_0910.pdf You won't be going off for four week long cruises to the Carribbean, be driving a new car every year, or shopping at M&S, but you will do alright. If you want more than that, I seriously would not recommend the highly speculative strategy that you're talking about. When people talk about 10 bagger strategies, they fail 9 times out of 10 generally. You are either going to have to save more between now and retirement, or work for longer. There are no easy options, and I thought you might have learned that from your debacle with Tesco shares. As for gold,I think it's crazy that some folks here are just so blaise about gold and how it is going to rise to a multiple of where it's at now. As for the Tesco shares, I would personally keep them. To me at least, they are cheap, and with a decent dividend, and Warren Buffett recently buying, I would feel in pretty good company. Not only that, but for the moment I would be taking advantage of DRIP, if it's available to you. Buy low and sell high - not sell low and buy high.
  4. Irelander

    Pension Gamble

    A few questions.... 1. You say you own your house, is it a possibility that you can trade-down to release some money, reduce your council tax, insurance, etc? 2. You say you worked mostly self-employed? Have you went to HMRC and inquired if you have enough National Insurance contributions to qualify for the old-age pension? 3. Have you any other assets at all that can help you in retirement, would your wife have a pension, or any assets herself?
  5. Irelander

    The Nikkei Thread

    There's nothing cheap about Japan, it needs to fall by about 40% before I would even consider it as being fair value. http://www.vectorgrader.com/img/srv.php?id=value_japan-cyclically-adjusted-price-earnings_sp Europe looks the cheapest market to me, ROE of 20%, PE less than 10, dividend yields of 4%. The UK is cheap, although not as much as Europe.
  6. Irelander

    Eurozone has "10 days at the most"

    I really wish people would stop making up these ridiculous predictions. The Euro will still be around in 10 days. Not because the problem has been fixed, but because another band-aid has been put on the wound. What's really ridiculous about this crisis is that people still haven't got to the nub of the issue. The problem isn't the debt per se; the problem is uncontrollable government spending that still hasn't been reigned in. By just writing off debt, printing money, or whatever, you're merely allowing the bad behavior of government to take us back to where we were.
  7. Irelander

    Pension thoughts and ideas

    Some thoughts. 1. If the employer is matching your contributions up to 10%, then at very least you should contribute 10%. Also, you have to remember that your contribution won't cost 10% of your salary. Assuming that you guys in the UK still get relief at the higher rate, that means you only need to pay £60 to get £100 put into your pension pot. You simply cannot turn your nose up at free money. 2. Keep your costs down. You need to check the factsheets out for each fund. Find out the management fee, redemption fees, whether restrictive bid/ask prices are involved, etc. I know too many people who get suckered into "glamour funds" like renewable energy, clean water, etc, but are completely oblivious that the management fees are a ridiculous 2% a year. 3. Be careful of market timing. You just mentioned that you're considering waiting for the economy to recover before you get into equities. That's generally accepted to be a foolish strategy as you're buying stocks when they're likely to be expensive. Where I work, I know too many people who stopped contributing to their pensions in 2008-2010 and basically missed out on the chance of buying equities when they were low. Personally, I am a big fan of indexes. The ones I can choose from have fees of between 0.1% and 0.2%, you don't get much cheaper than that. Secondly, while I usually have an idea when stocks are cheap and expensive, I can never pick an absolute bottom. That means I will always want some exposure to cash/bonds and equities. My mix is 80:20, at very miniumum, I want to have 20% of my pension in cash/bonds or equities. That means when I am bearish, I can have up to 80% of the fund in cash/bonds; and when I am bullish, I can be up to 80% in equities. I tend to limit myself to some sort of rebalancing twice a year. For example, when in Summer 2011, I felt stocks were expensive, especially considering they had double digit gains in 2009, 2010, and the first half of 2011. At that point, I began reduce exposure at the start of 2011 and was down to 25% equities by the end of Summer. Since then, all the markets are down, Japan about 20%, Europe about 25%, USA/UK down about 15%. I am currently taking advantage of the carnage and shifting into these markets now. Investing like this requires you to be schizophrenic. Back in Summer 2011, all the talk was of equities going even higher and most analysts were bullish. Now, a few months later, you have fear, and widespread selling, despite the market is down quite considerably. You have to ask yourself, do you want to be buying during moments of euphoria and high prices, only to sell during depression and low prices?
  8. Irelander

    GERMAN BOND AUCTION FAILED

    Don't understand the excitement. Surely it's a case that the bond market has finally woken up to the bubble that is German treasury yields? I mean, do people seriously think they are going to make money off a ten year bund that yields less than 2% before tax?
  9. On the other side, James Montier of GMO thinks that the mining sector is over valued http://www.investmentpostcards.com/2010/03/12/interview-james-montier-on-behavioral-investing/
  10. Irelander

    Irish Property / incl. Northern Ireland

    That house is actually in the Republic of Ireland
  11. Irelander

    Pensions

    Ok, you've said a few things there, and you've also put a few words into my mouth too! I will say that everyone has different financial circumstances and different goals that they want to meet in life. As someone who is relatively young, you're obviously keen to purchase a home, which is perfectly understandable. Owning your own home is part of that retirement plan, so as such, it should be made with a financial consideration. I don't have any problem whatsoever is someone foregoing a pension to buy a property, assuming it's at a reasonable multiple of income, and that the rental yield isn't too low. What I will say, is that holding the deposit purely in gold is risky. If you had based a home purchase at $1,900 gold, you would have been sickened if the sale had fallen through because it dropped to $1,700. What if gold then fell to $1,000? Assuming that just about all your financial net worth is in gold, how long would it take for you to get back to where you were? Remember, there is no such thing as a one-way bet, whether that be in tech stocks, financial stocks, property, or even gold.
  12. Irelander

    Pensions

    The United Kingdom has been through a Great Depression, two World Wars, an oil crisis and countless other traumatic periods in the last 100 years. Despite that, the rights of an individual towards holding private property has remained broadly untouched. I'm sure there with be more crises and more challenges in the years to come, but equally so, I think there will be many opportunities
  13. Irelander

    Pensions

    The amount of ignorance with regard to pensions is astonishing, when you hear about people talking about putting after-tax income into gold as an alternative, you just have to bang your head against a wall. Firstly, the biggest reason why anyone should have a pension, is simply to avail of the tax advantages that it offers. It's been awhile since I worked in the UK so excuse me if my figures are wrong, but if you're on the higher rate and you contribute to your pension, it will only cost you £60 for every £100 that you put in. If you go off and buy your bar of gold, you need it to appreciate by 67% before you even catch up with anyone holding a pension. If you want the shiny stuff for your retirement funds, then you should either be buying gold through a SIPP, or by buying an ETF backed by physical holdings (the Sprott trusts do this, I believe). Secondly, the era of idiot managers running a fund into the ground and charging 2% is dying. For the company I work for, the staff kicked up a collective fuss after we saw the value of our pension decimated during the financial crisis. We eventually got access to low cost index funds across a broad range of different asset classes (cash, bonds, index-linkers, globally focused-ETF's, etc.). If you are managing your pension yourself, there are lots of companies that offer low-cost routes into providing for your pension. If your employer doesn't offer these kind of alternatives, you should kick up a fuss - it is your money after all. Finally, just because stock market performance has been pretty dismal in the last 10 years, that is not to say performance will be dismal in the next 10 years. If anything, all evidence suggests that poor performing decades are usually followed by well performing decades. Oh, and before anyone mentions Japan, their stock market is only a tiny part of the overall market. In the real world, your pension should have some sort of geographical-based diversification.
  14. Irelander

    Mortgages

    Why interest-only?
  15. Budgeting is the obvious huge way to live frugally. You should keep a note of your bills and costs and set aside money from your monthly/weekly paycheck to meet these costs. If saving, you also should set up a direct debit that will automatically take a portion of what you feel you can save and put it into your savings account. Personally, I tend to leave myself little contingency in my budget, insofar as I might have to make myself do without a night-out one weekend, or I might postpone a treat I was promising myself. Another thing that lots of people don't do is to buy things in bulk, or to pay yearly, rather than monthly/quarterly (i.e. rates bills, insurance, etc.). Teabags are one example. I recently bought a giant 640 bag that was on offer recently, it was about 50% of the combined cost of the 80 bag boxes that I used to buy. You can do the exact same thing for lots of items like washing powder, rice, etc. Annualized over a year, cumulative savings are in the 100's easily. Building a passive income is also very important for me. I think blue-chip dividend paying stocks in non-cyclical industries can be a big part of this. For example, I bought some Coca-Cola stock a few years back for $44ish at the time it was yielding something like $1.10. Today, the stock is selling at $71 and yielding nearly $2. While I am not trying to pay down the mortgage, I am funneling quite a lot of my cash into these companies.
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