“It took us three years to find someone to manage our wealth, and we can now sleep at night! ”

Darren and Ruth Johnston (Semi-retired entrepreneurs) (N Wales) (2011)

Pensions liberalisations

Posted by jdavis on December 17, 2014

It seems that many retirees are getting excited at the thought of taking out all their pension fund and buying a property or two (as you do).

It's true.  From April next year - though we don't have the details yet - you can cash in your pension and do with it what you like.

Of course, you'll have to pay tax on most of it, which will help the Government, in the short term as they'll get your tax in one go as opposed to over perhaps decades.

Then, you can put down your deposits.  After all no-one loses with property.  And THAT is the problem. 

One of the definitions of a bubble is 'the belief that prices will rise because prices will rise'.  Well, we have shown often that prices, outside of Greater London are no higher than 2004, prices have been up and up for 30+ years and interest rates are at all time lows.

We cannot be comfortable with this asset class given the wider economic conditions and the history.

We accept that 200k+ new residents annually probably has a positive effect on house prices in some parts.  However, there are, to us, too many risks to this asset class, in the medium term.

We hope you are not caught out in the biggest ponzi in history.  Unfortunately, we feel you will be, whoever you are.

By the way, are prices low or high:

You tell us.


I assume the Ponzi scheme is residential property. Had I taken this approach I would have missed out on a very secure income and considerable capital growth. Sure there were periods when capital growth was low or zero but always income. I am talking about the period from 2000 to date.

Posted by Alan Coutts on December 25, 2014 at 9:22 a.m.

Yes, the ponzi is encapsulated in what yon just wrote

Posted by Jonathan Davis on December 25, 2014 at 10:11 a.m.

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