A new year, a new world. There are good things in it – looks like Pine Martens are building their ranks in England, after having been persecuted to extinction by the landowning aristocracy, which have a dreadful attitude to the entire mustelid family.
I collected £1500 from, Monevator’s Mogul’s tips, which pretty well covers the cost of entry. I had built up a pin-money stake in PSH sometime in May and June on the back of this tip article. Obvs Monevator disapproves of that, but reading ‘twixt the lines of his GFC era posts has served me well. I liquidated this holding not because I believe PSH is going titsup, but because it’s come to my attention that the main protagonist has a penchant for pursuing personal vendettas a la Elon Musk, and the Twitter share price is the cautionary tale. I don’t give a shit about the vendetta1 or the issues, it’s neither my circus nor my monkeys, but I don’t want to yoke a wagon to a horse with the emotional incontinence of a two year old, no matter how clever. Collecting a 25% uplift made the choice easier. I don’t generally have principles in investing, but when the lead has such a key influence then character matters, and emotional incontinence is not good. I’m happy to hold Tesla in VWRL, even if the CEO is sociopathic scum, but I don’t want to hold it explicitly due to CEO brain-fart risk.
Moguls can drift into Rich Kids of London territory in rarefied air these days. I read this broker article and thought to myself well, yes, I share the viewpoint that the FSCS £85k cap makes the guarantee not tremendously useful, but as for the tribulations of a family office, that is way above my pay grade 😉 Mind you, I didn’t know that Hargreaves Lansdown cap platform fees at £0 on a GIA if you avoid holding funds so I learned something new.
Like Monevator’s FIRE-side Jake I’m nominally better off than I was this time last year, though of course that has to be sat against double-digit inflation. I collected my £12k CGT in the GIA last year, and it will be easy enough to hit the 6k this year. After that, well, who knows what the rules will be. I’m not ideologically opposed to paying more tax if I get a Britain what works less badly than it does now, but I’m not going to volunteer for it 😉 The ISA continues to chunter away, the VWRL holding doing most of the work now, though my legacy HYP produces a useful amount of income should I need to go that way, though at the mo I reinvest that.
New Years resolutions – January’s a terrible time to do that, all dark, and cold, and dreitch. I don’t get the Calvinist Dry January thing, surely it’s better to ease off on getting hammered in December rather than going bonkers and then running into the abstinence when you could really do with some cheer 😉 I see some poor souls going running on the cold roads, and I wonder if we would do well to heed the words of Paul Kingsnorth.
it has helped me to understand something about the world I grew up in: we wanted the feasts without the fasts.
In the original Christian traditions, the fast came before the feast. We have this all ass-backwards, fasting after the feast, to shake off the lard of the excess mince pies and booze. I wonder if those previous generations were wise and knew a thing or two about the human condition, and fasting before the feasting is better for the spirit, including the secular form of the term.
We took time to go to Avebury in the brisk and short January days. The car park was closed due to flooding, but I know the site reasonably well, so there were other ways. Punters were thin on the ground, and the skies, though leaden had an attractive character.
After a bracing walk into the site we stopped for a coffee and then lunch at the Red Lion. It’s a standard Chef & Brewer so not gastronomic excellence, but it served us well enough and the fire was welcome.
Refreshed and renewed it was time to take on West Kennet Long Barrow. The winterbourne of Swallowhead Springs flooded the path at the start, I tested the quality of Grisport Exmoor walking shoes and can report they are up to the job.
The bleak sky showed the length of this long barrow – the inside is nowhere near as long as it looks from outside
Reflections on last year.
I started relearning French, using Duolingo. Cheapskate bum that I am I don’t ever do continuous payment authorities because you need the help of the beneficiary to stop them. Curiously, beneficiaries tend to make it the devil’s own job to impossible to unsubscribe. As a freeloader I can only make 5 mistakes a day before I get kicked out.
I’d be prepared to shell out $60 since it appears I could try and tart up my German at the same time, but CPAs – just no. I thought I was too old to learn the grammar in the indirect non-analytical way DL does but it appears this is not the case, OTOH I have 40-year old O level French and I am not yet absolutely sure that I have passed refreshing the high-water mark of that. Some of it is self-interested, we occasionally entertain the idea of snowbirding to somewhere like the South of France in the dreitch part of the winter. Thanks a million, Brexitards, for making this a more complicated exercise than it used to be. I can read French books on prehistoric sites serviceably, but I tried watching a TV interview and it could be line noise for all I know. Having said that, I’ve been able to get chow and beer in French IRL, the interactive live situation is easier than the TV.
vanquished by Morse again
Morse code has taught me I have a terrible sense of rhythm/timing. Looking back this shows in other areas- I never learned to dance, and the music I listen to is more about melody and tone colour than a driving beat. I am unlikely to ever be able to use Morse in a contact, but I have learned something about myself that I didn’t know before. Hats off to LICW for getting me further than several decades of tinkering. In particular they emphasised sending as well that helps anchor some of it.
I can’t form decodable characters with a straight key but using an electronic keyer I can get somewhere, and much better now that this time last year, so while it will never be usable it’s a move forward. I can send my radio call sign about twice at 12 wpm before making a mistake somewhere. Which is absolutely crap and of no practical use. The normal advice is to focus on hearing the code and decoding before touching a Morse key. That’s not really ever worked for me. I can hear the characters sometimes but never assemble them in real time.
The advantages of sending is probably the same mechanism as taking notes helps you remember a college lecture better, the mechanical process of writing things down makes it stick better. You don’t have to read the notes, which is just as well in my case as I’d struggle to read them, why handwriting is quite degenerate after years of using a keyboard. Curiously, though using a computer wasn’t an option when I was at university, it doesn’t seem to anchor understanding in the same way2, there’s something about the detailed use of a motor skill. Although my younger self had no truck with the idea, there’s still some worth in learning something badly, when you have the privilege of not having to make a living from your time. So although it’s functionally a fail it’s an obscure win as well. In WW2 the military trained grunts to 10wpm in three months, but they were starting with much younger minds 😉
social media purge
I’ve almost eschewed social media. I only ever really used Facebook and Youtube, in a separate browser instance, but I found it increasingly tiresome. I never saw ads on it – FB Purity and aggressive ad-blocking as standard saw to that, but I’ve already used more than half my thousand weeks on Earth and don’t want to waste it on that. I feel better for deactivating it, but it isn’t cost-free. I miss the lovely pics and video of weasels and stoats on the Small Mustelid group, and it did help keep up a little bit with acquaintances. Boomers and GenXers who organise club and social things seem to have zero idea that there is/was an open internet and that FB != the internet. Back in the day people would establish open websites for that sort of thing but Facebook Pages is just so easy.
One of the most pathological social media platforms is one that pretends it isn’t – YouTube, I’m looking at you. Two intelligent friends have gone down the antivaxx Putinversteher conspiracy rabbithole. There may well be a conspiracy of alien lizards running the world, but cock-up is normally a better explanation than conspiracy for any shit going down as a default option. In general Boomers and the leading edge of GenX seems to be susceptible to a vortex of wingnut media space, and YT is a common vector. One of these guys has YT on his TV and all the 10 videos in two rows of 5 were conspiracy videos from the titles. YT started to kick me off for using adblockers, and I came to the conclusion that I can live without its malignant influence, life is too short to tolerate blowhards weaponising the fact that negativity attracts more attention because: loss aversion.
This is not cost-free – while I can very well live without cat videos and wingnuttery I will miss Big Clive 3, and it’s a great resource for how to take apart and sometimes fix some malfunctioning widget. I may explore third-party front-ends, it’s the right-hand strip of related links that I want to suppress.
I was kicked off Instagram a few years ago after less than a dozen posts. I posted some pictures of some flower petals arranged in a circle and a blackbird moved some. I suspect Instagram’s AI thought it looked like a fanny or something, life is too short to beg Zuck to have a social media account reinstated, so I let it go. I didn’t have to give up Tiktok because I was never on it.
Losing social media isn’t a costless win and I will review it occasionally. Web 2.0 platforms balkanised the Internet into walled gardens, the problem is wider than social media. It’s tiresome to maintain three different video messaging systems because various friends use whatsapp(=facebook) or use Skype(=MSFT) and LICW uses Zoom, but it’s livable with, though tiresome. I sort of miss the old world where people would either use the phone or email, but the platforms won this battle, and all our base belong to them, with avoiding platforms it’s more a question of how much rather than not at all. The good guys of the open web 1 internet lost and the bad guys of web2 platforms won, largely because, as Moxie Marlinspike observed, people don’t want to run servers 4. They want to use services. That’s the original sin of Web 2 – the convenience of not running servers comes at the price of advertisers continually shitting in your head.
Web 3 – free speech blowhards and a bonkers model
Marlinspike is right about Web 3 – I investigated DeFI video platforms as a not-YT way of posting an old TV video I had a copy of, and the cure is worse than the disease. Web 3 has people yammering on about free speech. I’m perfectly capable of understanding the intellectual principle of free speech, the tragedy is that people who go on about it tend to be the most obnoxious gits with gun-nuttery, Trumpism and an unhealthy prevalence of sonnenrad iconography. The DeFi protocol is bonkers. If you put a video on a DeFi Web 3 platform you can’t remove it although you can sort of disconnect from it. I didn’t spend enough time trying to understand the particular blockchain instance to know whether it only needs to keep the hash of the video or it has to keep the entire file to maintain blockchain integrity, if it’s the latter then the resources needed by this platform will endlessly increase. Youtube can afford to buy more and more spinning rust because advertisers pay the rent, but a free Web3 DeFi platform is going to run out of road some time soon. Web3 sort of has micropayments better sorted, but it starts to make running servers look attractive in comparison, because World + Dog wants of your crypto loot. But the main thing wrong with the Web3 video platform was four copies of Alex Jones on the screen above the fold. Wrong Way. Do Not Enter. Abandon all hope, ye who enter here. Not my tribe.
a thousand miles of Somerset countryside
Over the last year I walked over a thousand miles. That’s not as much as it sounds because it’s a shade under three miles a day. Sure, all you hard nuts are into HIIT and weightlifting and swimming, bully for you. I go to see some countryside and hear birds, it’ good enough for me. I got the idea of logging it from Country Walking Magazine which the library carries digitally, the target market is those getting on in years, it’s a fair cop. Though I still don’t see the point of special walking socks, and I am of the view you don’t need all that special gear for walking, just a weather forecast that tells you if it’s likely to rain, in which case do something else or wait for an dry slot later on 😉 Walk1000miles is an example of Boomers using Facebook pages to implement their stuff, so that got canned with the social media purge, though thanks for the idea.
Somerset’s countryside suits me. I was born in London and lived in the city till my very late twenties, but I find pastoral countryside (with farm animals in it) more uplifiting than arable, though forests are cool and have neither. Not sure I could live in a forest though. Despite the pastoral preference I find cows really scary, best seen from the other side of a rhyne. Sheep are okay, in a gormless sort of way, as the late Dennis Healey said being savaged by a sheep isn’t something to be too afraid of. But I can say it from experience that you can’t outrun cows, you need a head start. Or to be Usain Bolt. Thankfully my 1000 miles has been done with the ungulates on t’other side of the water.
I weigh less than this time last year, and this seems a monotonic change over the years. I am more than 10 years older than my working self but probably fitter. I could almost entertain the possibility of one day reaching my 21-year old self’s weight, thought it would need serious effort. This has been the old-fashioned way, eating less/better, rather than using Danish chemical assistance 😉 I don’t think the thousand miles had much to do with it – unless you are sporting at Olympic levels exercise has minimal effect on weight in my experience. I guess I walked a similar about the year before, this year was simply the first I tracked it.
Fitness trackers – the price of convenience
Practically a fitbit makes a dreadful watch – no second hand and you have to gesture to turn it on5, reminiscent of 1970s LED digital watches you had to press a button to light up. So I may return to my Casio solar powered radio controlled watch, which has the attractive feature of – drum roll – an always on display, a feature Victorian gents had on their pocket watches but escape modern smartwatches. And a second hand is really nice to have… Come to think of that, being able to see the day/date at a a glance is also nice. I’m not able to use some of the functions of the Fitbit like sleep depth. The problem is I am quite photosensitive in the night and the occasional flickering of the sensor makes it harder to get to sleep and seems to degrade the sleep I do get. Other people are fine with this.
The Casio with its analogue display and small digital inset for date and radio-controlled time is pretty much my view of perfection in a watch and I was sad to displace it with the fitbit. I could sort of live with these limitations but I’m not so sure I like the idea of Google tracking my walking data6 and heart rate while watching their ads. That Google takeover gives me the creeps. I can probably extract the Fitbit steps to distance scale factor from the data and use a bog-standard pedometer. I did wonder if I wanted Bluetooth but then I look at how I use Fitbit and I use their app to tell me distance each day which I then manually key into Excel, so as long as something will tally by day a display is good enough for me, and a LCD display airgaps the data from the Big G. and surveillance capitalism in general. See, I have my own conspiracy theories too 😉
Other than the privacy issues, and the fact it makes a rotten watch Fitbit is the dog’s bollocks, if you are into the quantified self sort of thang. I think I want to move more in the direction of the analogue world, or more accurately the non-networked world for things that don’t need it. Things like TV, recorded music, DVD/BluRay.
living higher on the hog
Gracious living is more important to me these days – take my 10 year younger self who was prepared to chop up pallets for kindling . I CBA with that now. There’s a young lad down the road from a farming family who is saving up for his own tractor – he’s only 11. Anyway, they sell some farm produce and his kindling for £5 a bag, and after I’ve run out of the sweepings from the log delivery I bought four of his bags. I felt slightly rushed for the £20 but it should last me a while. I don’t split logs any more, I pay someone to deliver in a tipper truck, and if you’re paying for it they may as well do the work – why keep a dog if you have to bark yourself.
I didn’t make my logstore out of pallets this time, I designed it in Freecad and got Travis Perkins to deliver the treated wood to my drive and assembled it as I wanted it in the space I wanted with as little waste as I could design. It was dearer but looked better.
On the topic of quality, I am doing better at heeding my Dad’s advice, paraphrased as don’t work with rubbish tools, son. He was a fitter so his tools were indeed tools of the trade, very few of his hand tools have failed in my hands. There is, of course, a limited use in the modern world for Imperial sized spanners and taps/dies, though BSW taps and dies are handy for some plumbing. What did go bad were his Stanley pozidrive screwdrivers- these buggers seem to get brittle with age and the ends shatter in recalcitrant screws. I am aware of the difference between Philips and Pozidrive heads and take care not to mismatch them and match size. Perhaps I am just a bear and use too much force, but this doesn’t happen to me with recently bought PZ2 screwdrivers of the same make.
In this line I bought a secondhand 70MHz Picoscope 3204A for a couple hundred on Ebay. They will prize my Tek 2245 analogue scope from my cold, dead hands, but it’s too cold in the lab in my garage in winter without heating it so for fiddling with small digital bits like Arduinos PICs and ESP32 chips on breadboards it’s great7 and doesn’t occupy desk space. I was impressed by Picotech because I was given a DrDAQ sometime in 2011 and the firm still supports it, so they seem to be a class act. Getting on for 15 years is a longer service life than you expect of anything that needs an app on your smartphone, as IoS/Android will orphan old code. If it needs a smartphone it’s a consumer toy, not a professional tool 😉
fails
Some things didn’t work last year – I signed up with Ripple along these lines but came to the conclusion that this wasn’t right for me, so I let the £25 go. There were two prime reasons – I don’t want a smart meter, because I want Them to have to look Me in the eyes of They want to cut me off, as opposed to a swift clickety-clack in some network ops centre. Of course I have my price, but at this stage my power usage is pedestrian enough there’s no advantage in exotic tariffs
The second issue was I am not smart enough to be able to qualify the tax position, in my case it would be a hit on either dividend or savings income, and both of those I use the entire tax-free amount already. The fact it only offsets part of your power bill (not the network part) is also a weakness. This is targeted at people who want to warm fuzzy feeling of ownership and buy in to solving energy. I don’t give a damn about that, it’s about the bottom line and hedging a probably increasing liability. I am better off buying renewables ITs like UKW, Octopus, GRID etc, where if I want to hedge my entire power bill then I could. The capital gain/dividend amounts in a GIA are explicit and listed, making them easier to get a tax return right. Plus I can easily diversify across sites and across technologies. Plus the odd oil firm (or take the exposure in VUKE) because I have no shame.
looking forward – serenity
Yeah, we’re gonna need some of that, along the lines of the AlAnon dictum to accept the things we can’t change and change the things we still can, and have the wisdom to know the difference. What have we got to look forward to in 2024?
Dictator Trump in office in November. With a LOT of scores to settle. I need to find out if IGIndex will give me usable odds on him winning. So at least I may have a financial compensation for the enshittification of the things he will enshittify. I’m happy to lose the money if it turns out otherwise. I don’t feel strongly about the flavour of US government otherwise. And there’s SFA I can do to change it. But I can bet on what I don’t want.
Sort of worked with gold and Brexit, on the principle that it would probably tank the currency, which it did. So if I got something I didn’t want, at least get a nominal win. Though I shouldn’t have done it in the ISA…
This is the year Putin will probably win his Ukraine enterprise. Not necessarily in terms of his tanks rolling through Kyiv’s main highway a la June 1940 at the Arc de Triomphe, but in achieving his strategic aims. It showed that the West has no battle-ready arms production capacity, at least for proxy wars. The peace dividend got spent on delaying decline. Putin is running on the Taliban’s dictum you may have the watches, we have the time – it’s the same issue, writ on a different battlefield. There’s no popular desire in the West to pay for proxy wars over years. Putin has the advantage what he says goes, time is on his side.
We have seen imperial decline pull back from outposts before, indeed as a child I occasionally heard on the radio that such and such a British outpost had been granted independence, after the Americans showed Anthony Eden that they owned Britain’s ass with Suez. While that was before my time it reverberated all the way into the 1970s.
On a minor front, there’s something uniquely funny about Eton not being able to give toffs the £40,000 service they are paying for to get rid of the pesky problem of dealing with their children themselves. Because the shit’s backing up into the boarders’ dorm latrines. After all, it was Eton alumni who brought us the joy of privatised outsourced water companies, which were then loaded up with debt so they can’t function right. You bent it, you mend it, guys. Up to your neck in shit is where privatised water takes you, because resilience is dear, requires spare capacity and forward thinking. The shitmap‘s quite instructive
Makes you wonder what Eton parents think they are buying for half a million pounds? Bozza. Cameron. It’s clearly neither character nor competence that top private skool edukayshun gets you.
It’s hard to resist the gwana-gwana8 entirely at the beginning of the year, so what the hell.
I don’t want to be buying rubbish in future. That’s harder now than it used to be, because more is bought online. And as Ellen Ruppell Shell observed in Cheap, the high price of discount culture it’s hard to tell the difference
I needed AAs for my trail cameras. I am going to buy more eneloops rather than Amazon Basics, because it seems I last bought some in 2015 and they’re all still in service. Unlike my old Maplin rechargeable AAs some of which lasted five years, some six months, and the Lidl rechargeables, of which only half are still serviceable after 5 years.
No more cheapskate laser printer toner cartridges. I don’t print enough for the amortized savings to be worth fiddling about with cheap ones for half their service life to get rid of the streaks. Remanufactured originals yes, Chinese ‘compatible’ clones no more. Half the clones may be fine, but I seem to have run into too many of the wrong ‘uns.
It would be nice to buy some static white LED Christmas lights that didn’t start to lose sections or flicker irritatingly when they shouldn’t. While I don’t want to pay the extra to run them, my old incandescent lights from 1995 are still in working order, even after ten years of service to 2005. LEDs are meant to be more reliable, but this hasn’t been my experience. You can buy fairy lights that are connectable, that at least lets you split the fault between power supply and lights, and swap out suspect strings. The two year guarantee makes that more attractive, and this is not a bad time to buy Christmas lights 😉
I want to see some pine martens this year. Probably still have to go to Scotland and pay Johnnnie Rothiemurchus his dime again, I don’t think there will be martens turning over my bins any time real soon.
I want to see more of Wales. Particularly the Brecon Beacons, I have a book of stones and stuff in the National Park. Plus there are some great hills to play with radio a bit, I want to combine a bit of both. I haven’t really made best use of the proximity that much, but Mrs Ermine has identified a spa that could be a good win, and we are partial to Saundersfoot and Pembrokeshire, with these bad boys on the coast
I’d like to see the Northern Lights one day. This year and next aren’t a bad time to do that, the solar flux index is higher now which is why English Heritage can say you can see the Northern Lights at Stonehenge once in a blue moon. The cheapest way is to do Scotland’s NC500 – I’ve camped along that in the past before it was quite such a thing that they gave it a name, but I’m not so sure that’s an easy win. Would be sort of compatible with seeing pine martens. Perhaps also red skwerlz ad Ospreys at Abernethy. The other way is to do a Northern Lights cruise along Norway’s coast. I’ve never been on a cruise and I am an introvert so while it’s a more guaranteed win on the Northern Lights front there’s a different question mark. That’s something that’s difficult to micro-try 😉
thunder in the distance
I do wonder if Flameeyes has a point, as WordPress starts to focus on monetizing their offering I may not see this time next year if they bust my ass for TOS violations. I don’t have that many affiliate links and I sure as hell ain’t making any useful money out of this – it took two years for Amazon to pay out £25, but I’m not going back and icing each and every affiliate Amazon link because: life is short.
I have admiration for Flameeyes because he summed up the way I felt when I was called in to the leads office in 2009 and observed a 27-year working life start to melt in front of my eyes, the powerlessness. And some of the focus that I gotta get outta this place, if it’s the last thing I ever do, pace the Animals. I had options because I was older and some aspects of the position were less shit, though Flameeyes is brighter than me and probably saw faster career progression. Anyway, he says that there is thunder in the WordPress monetisation distance. The cost of platforms again, WordPress owns my ass on here
- Funny how Bill’s cast-iron principles on one of the vendetta issues softened when Business Insider observed he had an example of the issue in the family, what goes around comes around, eh, Bill? ↩
- The Pen Is Mightier Than the Keyboard, Muller and Oppenheimer, APS 2014, DOI: 10.1177/0956797614524581 ↩
- yes, I know. Big Clive is a Youtube link. For some reason they don’t kick me off in Private Browsing. As Walt Whitman said, very well, then I contradict myself. I am large, I contain multitudes. ↩
- I am one of them, I ran a colo web server in the 1990s, and I used to host this on a shared server. But keeping the bad guys out is tiresome, the worst thing about running servers, although being a Linux sysadmin runs a close second in the roll-call of non-gracious living grunt. Running servers is a thankless task, the best you can do is not screw up, there a whole world of bad guys trying to hack you and it takes time and nervous energy. It’s not surprising that people moved on after the Eternal September. Your mother isn’t going to run her own SMTP/IMAP email server, and she’s be stamped on for running a potential open relay if she did in 2024. Strange to think that I had to do just that in order to use email, getting on for half a lifetime ago ↩
- it kind of puzzles me why Fitbit use a OLED display, it’s not like they make tremendous use of it, an LCD would be fine, matching the capability of late 1970s digital watch displays after Casio invented the LCD display that fixed that problem ;) ↩
- as well as heart rate, for instance while I am seeing their ads ↩
- One serious limitation of the picoscope is there is no trigger holdoff function, which can matter if you are trying to nail a frame of repetitive digital data. I searched high and low, for where the hell this feature was before Google showed we it wasn’t. In general compared to an analogue (or presumably decent modern digital LCD scope, but I don’t own one) I get the feeling that the picoscope shows you less than half the signal activity until triggered. The picoscope is dear for what it is new but secondhand prices are OK. If you can only afford one, get a real bench scope, a used analogue 50-100MHz unit is a bit better for seeing ehat’s going on than the Picoscope and vastly better than any Chinese DSOxxx nano from ebay, which I can only use because I’ve used real oscilloscopes, heaven help a tyro maker with just a DSO 213 nano 😉 But the Picoscope does many things very well, and some things that only a DSO can, for a low-ish cost of entry. ↩
- From The Register’s description of the sort of business presentations I’m heard too many of though they are in my increasingly distant past now. You know the sort, where Mr Big Cheese stands up in frot of an all hands thing and tells us that this reorg is gonna fix all the things wrong, it’s gonna do that, it’s gwana do this, it’s gwana do the other. New Years resolutions fit into the gwana-gwana space, because like reorgs we’ve heard it all before and it changes SFA because change is hard, perseverance is hard, and all that good stuff. ↩
Simple Living In Somerset 
That’s some post. Many thanks indeed! I couldn’t get on with Babel or Duolingo so I got a 10 minute app instead which teaches useful words. I have a Spanish one as I have just emigrated
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> Spanish one as I have just emigrated
Congrats, and using a language IRL is probably the best tutor on the planet!
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Re YT and ad-blockers. I find that deleting the YT cookies will remove the issue for a few sessions. Important to clear the cookies before you open a YT tab, otherwise you might have to wait till the following day to be ad-free (I use the “pause once” option on AdBlock to put up with the ads temporarily, though sometimes they don’t reappear, which is a unexpected bonus).
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That explains why Private Browsing works every time, because PB is/should be new born on each instance. While that fights the technical problem, it doesn’t address the headfuck that is youTube. However, having to be more intentional by using PB may be a decent halfway house – girding the loins before going into the foetid cesspit of YT, if trying to fix something
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The only ad blocker that works on YT currently is the open source uBlock Origin.
On YT / social media generally, the evidence surprisingly “suggests echo chambers are much less widespread than is commonly assumed, finds no support for the filter bubble hypothesis and offers a very mixed picture on polarisation and the role of news and media use in contributing to polarisation.”
https://reutersinstitute.politics.ox.ac.uk/echo-chambers-filter-bubbles-and-polarisation-literature-review
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> the open source uBlock Origin
that’s the one I use.
I read the paper – it was curiously hard to determine the date of the work. Many of the refs are pre-covid though not all, I think (from observation) Covid dialled conspiracy theories and susceptibility up to 11.
Oddly enough I talked to these guys recently and discovered that the reason that 21st century tech can’t put people (or equipment) on the moon via a soft landing with the ease that you’d expect of 50 years of advancing tech isn’t that the NASA has lost some of the vertically integrated mojo of it’s 60s incarnation. The explanation is much simpler. There never was a moon landing 😉 Time for another beer and move along now. So there is at least crosstalk in this particular instance of bright conspiracy theorists, though I was unaware that rabbithole had been gone down, in both cases.
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Hi Ermine, can we have a couple of pictures of the wood store and the price of materials.
I bought a small pallet of wood and they sold me a matching “Jacket” for £100 to keep the wood warm and dry!
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Freecad outline (not every piece of wood is shown for clarity, use your imagination to complete it, and note that the side slats are repeated three times – LHS, middle divide, RHS) The dark grey base is merely symbolic of the ground realestate
Freecad assembly pic is here
Overall cost was less than £500 but this is polluted by another job, but I was an idle bastard and got Travis Perkins to deliver. I’m sure you could do better. Capacity is a shade under 2 x 3m^3. I used tanalized wood. For God’s sake put the slats on the inside of the risers and let the 1.5″ extra space go 😉 Tanalised wood eats through Screwfix silver screws (BZP) but gold screws passivated are OK
I had an old 4″ sq fence post that I cut up and used to spread the load on the lower horizontal runners
You can sort of see how you do it with pallets in my old log store extension. There’s nothing wrong with using pallets and you can’t beat the cost, but they do eventually rot, choose good’un for the base, and the height is such that you tend to hit your head on the roof bit in the dark 😦 The width is also somewhat limiting.
I designed around commonly available lengths to reduce waste – 3.6m is a common length. Note that 1.9m + 1.7m makes 3.6m. I only have a cheap though adequate chop saw. Table saws and the carpenter’s motorbike sort of saw frighten me so I don’t have them.
Unfortunately I polluted my BOM with the parts to fix a wooden garden bench like a pub outdoor tabe, which basically involved replacing every damn piece of wood with treated wood over a few years, so it is like Trigger’s broom. So I paid less than £500 for the logstore, and the bench consumed some of the parts.
I got some inspiration from these guys
https://www.littlehouseonthecorner.com/build-a-log-store/
as well as from them the bad idea to put the slats on the outside of the risers. Don’t do that, or if you have to, use manful screws. How the actual hell their slats stay on the risers when they are nailed beats me, either they are much better carpenters than I or the smaller scale means the sideloading is not as bad. I don’t really do nails in tension but that’s maybe just a personal prejudice. I don’t have a manly nail gun either, claw hammer is my friend.
I went a lot larger than them because I was aiming for two years, so that any wood has been on site for at least a year.
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‘Bonne chance’ with the Duolingo French – 533 days and counting for me on a free account too.
Slowly going back over previous lessons to practise but also the gamer in me just has to get the Legendary status of lesson completion!
Also, I stay in the Obsidian League, which is the one below the Diamond one – this one gives me the right motivation so I can’t slack but neither do I feel compelled to do hours just to stay/compete for the top.
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Good to know they won’t kill me off over time by simply making it harder and harder – nice one on the getting on for two years!
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Great post
Minor point -as a Scot I spell it”dreich”. -is it pedantic say the English way is different !
xxd09
PS if you like Stone Circles,Barrows ,Brochs and Sous -Terrains and other Stone Age manifestations Orkney is your destination-it’s even quite warm in the summer and so far is still part of the U.K. unlike the South of France
xxd09
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> dreich
My bad. It felt sort of wrong even when writing it.
Totally with you, Orkney is terrific, I enjoyed Maes Howe, and I enjoyed the Alba prog on the work they’ve been doing at the Ness of Brodgar, I visited at what must have been the start of the dig encampment. Prolly good for the Northern Lights too . Maybe me my camper van need a return visit.
As you say, however, a summer thing. The south of France has the edge for snowbirding 😉
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I don‘t like language apps, although I accept that some people get along well enough with them. But there are a lot of good YouTube channels out there, where you can encounter good enunciation tailored to learners at different levels. For French I would recommend trying some of the following: Français avec Nelly, Piece of French, innerFrench, Le français by Alex, Easy French, Français authentique.
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> Like Monevator’s FIRE-side Jake I’m nominally better off than I was this time last year, though of course that has to be sat against double-digit inflation.
Me too.
And, I have recently crawled back above the real position immediately prior to my pulling the plug some seven years ago.
Having said that, Jakes scenario/circumstances is/are somewhat different; with possibly the most significant difference being that he is living exclusively from his Pot.
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Thank you for the woodstore pictures. I’ve forwarded to my wife and she is deciding if this is a project for me this year or not.
A lot of the joggers/runners will have been active pre-Christmas so deserving of the feast. The main marathon seasons are March/April and Sept/Oct so a lot of long runs will be being done in the next few months.
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I’ve just eclipsed previous portfolio high of Jan 22. Last two years has been a grind!
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@Rhino:
Likewise, I have recently hit a nominal Pot high.
I suspect your real (CPIH adjusted) trajectory may be rather different though.
FWIW, since I pulled the plug at the end of 2016, my real story goes as follows:
a) all time [real] high hit in Jul ’18;
b) notable, short sharp dip at the start of 2020 but never really threatened to drop below CPIH;
c) quickly recovered most of the lost ground to hit the next highest real point in May ’21;
d) since when all real gains [vs CPIH], and more, progressively surrendered;
e) first dipped below real Dec ’16 value in Jun ’22;
f) hit real bottom [to date] in Apr ’23 at a handful of percentage points below Dec ’16 value;
g) since when I have crawled back above the real position immediately prior to pulling the plug
The Pot largely funded our lifestyle until spring ’23 when I commenced my DB pension somewhat earlier than I had initially planned.
Kind of wish I knew how to post a picture hereabouts?
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You can use imgbb and the <img src= html tag. But it seems fractious, it mostly works but sometimes doesn't. Beats me why. Which is why I used the blog image attachment page mode this time
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I’ll leave trying to embed the figure for now.
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> I’ve just eclipsed previous portfolio high
Congratulations sir!
I’ve reached a NW real terms high, though I have only just managed to meet the equivalent of what would have happened if I went balls-deep in VWRL with all available investment capital in 2012, and ate a serious relative suckout relative to that 2012-2019.
Before all the passivistas go bwahahaha told ya so active muppets always get roasted etc, it’s worth noting that I largely lived off the income across that period and wrote off some of the capital buying more house in 2017, for utility rather than investment. I don’t count house in my NW because of a traumatic previous experience with the asset class.
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@ermine,
Congratulations!
IMO you have done very well; especially since you started your DB in 2019.
I doubt very much that I will come anywhere near repeating your NW achievements over the coming years. Principally because I am far more conservatively allocated. Having said that, I did somewhat out-perform my own expectations across the Gap (from pulling the plug to starting my DB) and the early signs for the current phase (since I started my DB last spring) are not discouraging.
Time will tell.
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> I started my DB last spring
That helps in and of itself. Obvs it is a static income, I didn’t compute this as part of my NW either, and its appearance reduces the load. But it also changes your risk tolerance, in some ways more towards that of someone with working income, though arguably more secure – it’s hard to get sacked from a DB pension.
My guilty secret in later part of the period was shorting covid, and Covid had other windfalls too, for those who survived it, and I note with sadness that despite all the wingnut denials it would appear that Covid did result in excess deaths. I’d prefer not to face more unusual mortal threats that change the financial risk profile like that…
I am now carrying the deadweight load of more gold and probably more cash than I should. But after a win like that it pays to salute the grace of Lady Luck and not try and hit it out of the park again –
You got to know when to hold ’em; know when to fold ’em.
Know when to walk away; know when to run.
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See the Declaration of Interest in the Lancet article. Anything but the vaccine. I’m all in on Dev World Ex Uk, can’t see are valid reason to diversify outside of this especially in accumulation stage..
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> I am now carrying the deadweight …
and
> You got to know when to hold ’em; know when to fold ’em …
Indeed.
Even today I do not think I would sleep too well with the aforementioned FIRE-side Jake’s previously reported allocation of nearly 99% to equities, see: https://monevator.com/fire-side-chat-domestic-geo-arbitrage-made-it-possible/
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OOI, I replied to this post late yesterday, but it seems to have gotten lost in cyberspace.
Just thought you should know there may be gremlins about!
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Yup. Buggered if I know why the Gods of WordPress deemed it spam, but I hoicked it outta there. Probably AI trying to be clever. Sorry about that! Platforms, eh, all those damned Boomers taking the easy way, mea culpa!
> I do not think I would sleep too well with the aforementioned FIRE-side Jake’s previously reported allocation of nearly 99% to equities
Note that he’s in his mid 40s. His risk profile is different
Jake has the option of working again if ti goes titsup. I don’t. That favours a higher equity share.
I was functionally though not physically invalided out of the workforce in 2012, although TBH I shared some of Jake’s asset allocation in the early days. But that was ex GFC, I’d (and do) feel differently about that now. Then it was a case of roll the dice because the whole place was on fire, Dubya had a point that this sucker could go down, but TI’s bat-signal called it right, and anyway, what else was I gonna do, better to burn out than fade away.
Some similarities with the Covid short, either this was gonna get me, in which case que sera, sera, or not, in which case worth a punt. There it was in the micro, not the macro like the GFC.
I’d prefere to live out my life in the decline of the West without such, er, opportunities rocking up. But as the old boy said, you gotta play the hand you’re dealt. But more cash and gold is good for now, sure, I give up performance, for the sake of comfort. Comfort gets more important as i get older 😉
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@Al Cam
The standard commenting facility in WordPress is text-only so you won’t be be able to embed images in a comment. However, it is possible for the site owner (i.e. ermine) to add a plugin that will allow commenters to upload images. The plugin is called DCO Comment Attachment.
@ermine
If you are interested, there’s a video here: https://www.wpbeginner.com/plugins/how-to-allow-users-to-upload-images-with-comments-in-wordpress/
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I don’t get to use plugins, because I am a cheapskate bum freeloader.
Having said that, take the image on here
https://0.gravatar.com/avatar/ab0fba01a15d288e1bf0ed10c7a5262b44fd2999be4525565a0b631599313357
which is apparently my gravatar avatar, a mustelid. Using img src I will try here
let there be ermine
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and there was ermine 😉
That’s img tag as in here
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@ermine
That works because the img tag will work fine with external sources. Al Cam can do the same i.e. link to an image that he has uploaded to an external source (like you’ve done to an image that you’ve previously uploaded to gravatar.com). What he can’t do is attach to his comment an image that is held on his computer’s hard drive. Of course, he could link to an image on his hard drive using the img tag if he’s running his computer as a web server. But I guess that’s unlikely. 🙂
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Hmm, that’s what https://imgbb.com/ and imgur are for. I uploaded this gorgeous crew just now, will autodelete in 3 months
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Handsome chaps and chapesses there. Reminds me of when two pine martens sped past me – one apparently chasing t’other – on a footpath in the Ben Damph forest south of Loch Torridon back in 2006. A brief but enchanting moment.
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That’s a great photo! Just reminded me – we saw a “half ermine stoat” at RSPB Minsmere on a trip recently. The back end was all white, it ran past the hide too quick to get a photo.
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Lovely, aren’t they? Sadly not my photo, my greatest regret on icing Facebook is the loss of the Small Mustelid group.
Many years ago, sometime in the aughts of the New Millennium, I saw a fully white ermine at RSPB Titchwell which surprised me, I didn’t expect to see stoats in full ermine this far south.
‘Tis the way of the stoat. The Small Mustelid groups seems to mainly use camera traps, and the Mostela is used by some European wildlife organisations. They generally don’t have the bad attitude to stoats and weasels that generations of British gamekeppers and Kenneth Grahame have seeded into British culture, and cherish and conserve their small mustelids.
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Re Northern Lights: we did a four day Jet2 break to Iceland last year. Research suggested the Lights were on the way out by late March and the whales wouldn’t turn up until April. We booked the trip for the last weekend in March and crossed our fingers that climate change might deliver warmer water and earlier whales. Result! Northern Lights rocked up on the Friday night and the whales rocked up on the Saturday afternoon. The Lights are mind-blowing. Like being in an episode of the X-files. We’re both physics graduates, but both found ourselves staring at dancing shimmering ribbons of light and completely understanding why they were thought to be messages from the gods. If you do Iceland, take a rug for your legs as well as everything else.
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> Research suggested the Lights were on the way out by late March
Thanks for that heads-up – I didn’t realise there was a significant annual cyclicality. Stands to reason, radio propagation also varies annually as well as the 11-year cycle.
Mrs Ermine has the ambition of geothermal pools in Iceland, another way to stay warm 😉
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A good post. Congratulations on the CGT harvesting and 1000 miles. My portfolio is up a multiple of annual expenditure this last year and I’m not withdrawing yet so I guess that’s a win. Just living off dwindling excess cash bucket, but I’m going to get some cash out of the HL SIPP when I’ve figured out how to crystallise / partial drawdown the dividend cash. It looks like I can start it on the website.
I didn’t know Google had bought Fitbit. Horrifically I’ve gone all in with them and use a Pixel smartphone, tracker in my pocket thing. I lost my paranoia for big corps having my data somehow. Google has this Fit app that tracks walking stats – step count and miles etc. It seems reasonably accurate checking against regular walks of known length. The only pain is it doesn’t have a web page to look at the data – I have to manually take the data out of the app, it has monthly summaries at least. So according to that I walked 1300 miles last year which was a surprise. It includes regular walks to a pub to meet a friend for beers though – does that count?
The one corporation tracking my personal data that bothered me was my previous employer. Having HR monitor and peer review your social media posts is a bit weird. Shouldn’t have let colleagues follow me. I made mostly photographic posts but the odd rant about work when it got too much and I needed to let the steam escape 😂
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Bill,
If I may, a few thoughts:
a) I liked the way you quantified the pot movement in terms of annual spend;
b) does your pot exclude your cash bucket;
c) in my admittedly limited experience income drawdown, in all forms, is a bit of a pain, and note that everything may well take far longer than you probably assume;
d) have you given any further thought to ensuring you drawdown at least your personal tax allowance worth each year (even if you just park it into an ISA) – the personal allowance is use it or lose it
I’m with @ermine and avoid SM like the plague.
OOI, have HR not got anything better to do with their time than “monitoring AND PEER REVIEWING (my emphasis & do fxxxxn wot?] your social media posts”?
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> I’m with @ermine and avoid SM like the plague.
I miss the old days before FB, where there were forums and suchlike. I had a go with Mastodon, but I think that’s trying to copy Twitter. I never really understood what was the point of twitter even before Elon Musk. And I am too verbose for that.
What I liked about Mastodon was the absence of most commercial tripe, but it came at the price of no way to find your tribe. Facebook for all its faults introduced me to that family of ten young stoats, but it was the tracking and low-level scumminess that pushed me over the edge. And it brought out the bloody worst in people, particularly over the pandemic, conspiracy nuts to the left of me, wing-nuts to the right of me, stuck in the middle with wierdos and bots. That made getting outta there easier
Mind you, a look at oldavista reminded me of the sheer visual fugliness of t’old internet, though at least it wasn’t all the same mobile-first corporate websdesign blandness we have now
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Al Cam –
Thanks.
>>does your pot exclude your cash bucket
The pot I was measuring against my expenditure is all my invested assets (stocks + bond funds, shares etc) over all my accounts (pensions + ISA +GIAs) excluding the cash bucket.
I do measure the cash bucket too. In my “Warchest” spreadsheet I have a line item “cash at bank” which was about 6 years basic expenditure when I retired nearly 3 years ago and is down to about 4 years now. It excludes stuff in NS&I so a bit messed up as I put some of the cash into an NS&I account for interest and a loan to a family member got paid back. The NS&I cash bucket is a decent sum but some of the NS&I accounts are more locked up with changes to ILC withdrawal locked for the full term etc so only the Premium Bonds and a small income bond account can count as major emergency cash. So I want to start getting cash out of the SIPP to replenish the “cash at bank” line as I like it around 4 years base expenditure.
>>drawdown at least your personal tax allowance
Yes, this is the plan. Draw down near the allowance from the SIPP and this is about what I’m getting in dividends so I don’t have to start murdering any of the ETF funds in there! I can get a similar amount from the ISA in dividends but I’m re-investing that currently. By an “accident of life” I have a bricks and mortar asset I can sell to raise some funds to put in the ISA and GIAs – I will have to pay some CGT on it, but that’s life.
>>social media..
What happened was I posted a rant about work IT issues on my Facebook after wasting a shed load of my work day on trying to boot the company laptop past a security encryption setup screen. One of my direct colleagues was following me and clicked “like” on it so one of the IT people following her saw it and shopped me to HR for breaking the social media policy. It was really a non-event but the HR lady who helped me sort some manager problem issues out and set up a part time arrangement got frustrated with me in case it got me fired. I worked out who it was who shopped me – one of those people at The Company whose social media life was all about being worshipful of the employer it seems. Got made redundant just the same as me but I had my FIRE plan in place. I reluctantly got on FB to keep in touch with friends and family and share wildlife photography but somehow links to work people crept in…
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@Bill,
For some reason I missed your reply (of 20/1/24) until now – some seventeen days after you posted it! Ooopps.
In any case, thanks for the additional info and it certainly helps flesh out (and give a fuller context to) some of your subsequent posts/comments. The social media saga is very interesting and could act almost as a warning to others. Whilst I do not sympathise with the HR lady, I can almost see where she might be coming from. Very much the law of unintended consequences. During my time at work we coined a phrase that might be apt to your then IT situation – the only place growing in this company is the hurdles department!
Will you keep us posted re the possible bricks and mortar disposal?
I ask as I suspect people would be interested in how you deal with the windfall including paying any CGT due.
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> For some reason I missed your reply (of 20/1/24) until now – some seventeen days after you posted it! Ooopps.
You didn’t miss it, it’s my bad. I fished it out recently from the assigned as spam box. I don’t know why it got stuck there 😉
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Sorry for the spam 😂
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@Al Cam
Thankfully the workplace / HR / social media policy situation is all behind me and I’m not going back!
> Will you keep us posted re the possible bricks and mortar disposal
Working out the CGT will be the hard part! I will need to get a tax accountant for advice and to work it out although I found some online calculators to get a ballpark idea. I can claim some PRR relief as it was my main residence for some years but we then bought a second property after my partner moved jobs. It was a weekly commute situation for me as my intended job move didn’t happen, which is why I kept the original property. Calculators indicate maybe £20k CGT due after some private residence relief but then some decent proceeds to fund cash buckets, GIAs and ISAs – in the not a bad problem to have department with no mortgage. A tax accountant will probably turn up some things that can offset the CGT, property tax looks to be a minefield and something to be avoided though! Residential property CGT is due within 60 days and cannot be left for a tax return.
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@ermine
Thanks for letting us know.
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@Bill,
Re calculators: have you tried: Tax when you sell property: Work out your gain – GOV.UK (www.gov.uk)
I, for one, would also be interested in your strategy for the proceeds. I suspect that there may be some new/other/unknown opportunities when you are dealing with such a lump sum investment. I also suspect, of course, that there will also be new/unknown risks too.
Yup, HR (aka Human Remains) is a dim and distant thing nowadays. Perhaps the rot set in when they changed from being known as Personnel.
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> get some cash out of the HL SIPP when I’ve figured out how to crystallise / partial drawdown the dividend cash. It looks like I can start it on the website.
It’s an absolute doddle. They spin off a drawdown account in parallel, and you transfer from the SIPP into the SIPP drawdown account whatever proportion you want, and then issue a transfer out from the latter. There’s a cutoff date each month, provided you get in before that it happens in about a month and a half. I only tend to do that once a year or less. You get the TFLS separately and usually earlier. They tax all of my drawdown at BRT, but that’s okay in my case as that’s what it ends up as, I use their P60 to do the SA100 tax form as well as The Firm’s pension scheme P60
Obvs you need to reflect on the effect on your money purchase annual amount, though since that’s £10k nowadays compared to the more restrictive £4k back in the day it’s probably not an issue for people who a properly retired, more an issue for the ramp-down approach.
There’s also the UPFLS option but I’ve never done that. I’ve more or less grounded my SIPP just in case there are movements to add NI to pensions, the proceeds have pretty much all gone into my GIA
> The one corporation tracking my personal data that bothered me was my previous employer.
Wow. In some ways at least they are paying you, rather than shitting in your head. I left work in 2012, it seems that employers started to want to own more of you in the years since then including social media policies. Still, you#re shot of that now 😉
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I’ve also got a SIPP with HL but haven’t yet extracted any money from it, so have no experience of the practicalities of UFPLS vs flexible drawdown with them. Intuitively, for ad hoc withdrawals, the idea of UFPLS appeals to me. This avoids the creation of the separate drawdown account. Now that HL are paying reasonable interest rates on cash in a SIPP, it is desirable to keep any cash in a single account to maximise the tiered interest paid.
I think the clincher is the tax treatment of the two methods. I note that your flexible drawdown withdrawals are coded BRT – but was this the case from the first withdrawal, and not only on subsequent withdrawals after HMRC had had the chance to issue HL with a tax code? I suspect that UFPLS may always be treated as a first withdrawal and paid using an emergency code, necessitating a tax reclaim.
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While my first withdrawal was an emergency tax code I think I only drew a month’s worth, explicitly to trigger the HMRC sausage machine. My 2017 HL P60 shows a tax code of 1100L which seems to indicate HL/HMRC got their act together – ISTR the pull a month’s worth was the recommended approach to trigger that, for punters with only HL SIPP pension income. Nowadays the personal allowance is allocated to The Firm’s pension and HL is all BR tax which is okay as it should be as The Firm’s pension burns all my personal allowance as it is.
I think there was some residual tax reclaim on that first month, but it wasn’t as bad as if it were on the rest of HL for that year.
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Thanks for that. I think another ruse, which I guess can work for UFPLS as well as flexible drawdown, is to withdraw towards the end of the tax year. That way the cumulative tax system cannot assume many more months of payment at the same level. This has an element of jeopardy though, as @Al Cam cautions, that arranging the withdrawal may take longer than expected.
I thought of another potential pitfall with flexible drawdown with HL. Does the separate drawdown account have its own £200 fee cap (for shares, gilts, ETFs)? This could potentially double the fees on the SIPP.
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> Does the separate drawdown account have its own £200 fee cap (for shares, gilts, ETFs)?
Can’t say for that. I always took the line that I want to hold equities etc in the non-drawdown SIPP and only used the drawdown as a cash buffer (ie I sold in the normal SIPP and xferred cash into the drawdown, and then drew down pretty much ASAP. HL tend to close the drawdown account after it has had zero for a while, but it’s not the worst thing in the world to get them to open a new one/reopen/whatever. But you would be wise to give yourself two months to get all the ducks in a row, so if you are going for TY end, then get your skates on for the end of this month.
I find it hard to imagine the conditions under which I would want to hold equities in a drawdown account, may as well hold ’em in a GIA, for which I have learned from Finimus that there is no carry charge on equities in a HL GIA, link is somewhere in the first half of the post. If I am holdign equities I am hoping to gain there, and I may as well take my 25% TFLS on such proceeds in the SIPP shelter rather than the drawdown, and selling in the SIPP shelter and transferring only the cash makes the tax position much easier to define IMO.
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Yes, holding only cash in the drawdown account makes sense.
The mechanics of withdrawal are at the moment only of casual interest as I am not considering withdrawing from the SIPP in the immediate future. There have been a number of discussions here, I think, and elsewhere of emptying the SIPP ASAP within the BR tax band (or the personal allowance if there is little other taxable income) and investing in a GIA. I have been reluctant to do this as my DB PCLS (from its AVC) and small inheritance from my late mother already give me the problem in my GIA of managing CGT within the ever decreasing annual exemption while I slowly transfer the funds to my ISA. The idea of adding to this problem by removing funds from the SIPP to the GIA, and paying income tax in the process, did not initially appeal.
I am slowly beginning to rethink this, though, as the freezing of tax thresholds means that year-on-year the amount of BR headroom is getting ever smaller. The dilemma is that although there is ever decreasing headroom to withdraw from the SIPP at BR tax, if I do so it increases the unsheltered dividends/interest in the GIA thus further reducing the BR headroom! The fact that dividends are preferentially taxed does not help much as all income eats up the BR band. Okay, nice problem to have, but it doesn’t stop me overthinking on this one!
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Holding cash in the HL Drawdown account like @Ermine suggests is exactly what I now plan to do. I investigated UFPLS for the SIPP dividend cash withdrawal to avoid the up to £200 additional fee then realised that if I just hold cash there it is a non issue. HL seem to have more online support for the Drawdown account route and it is form pushing for UFPLS as far as I can see from investigating forums like Lemon Fool.
What I’m planning to do is move cash into the Drawdown account so will get the 25% tax free straight to the bank account. Then every few months nibble at the remaining cash that is taxable but stay under the personal allowance. To do this I will just withdraw small amounts if it is not too onerous say 1/12th each time as this HL emergency tax calculator seems to suggest this will work but I will have to suck it to see! https://www.hl.co.uk/retirement/preparing/tax-matters/emergency-calculator
So what I’m trying to figure out with HL is
1) How easy to move dividend cash that accumulates in the SIPP over to the Drawdown account on the website
2) How easy to withdraw the taxable cash from the Drawdown account on the website
3) How the tax will work to stay within the personal allowance and not pay emergency tax and have to claim it back.
If I can do all this on the HL web site with minimal paperwork and wet signatures etc I will be happy. It feels like it should be this way but pensions are more complicated!
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> How easy to move dividend cash that accumulates in the SIPP over to the Drawdown account on the website
it’s like moving any cash – I sell first and then move all the cash to drawdown. Obvs when I was using the personal allowance I only sold so much as to target the right amount of cash, but now all is taxable I make usre the min amount of over £1k is held in VWRL and swept the rest out.
> How easy to withdraw the taxable cash from the Drawdown account on the website
Just tell them to do that before the cutoff date which is well highlighted.
> How the tax will work to stay within the personal allowance and not pay emergency tax and have to claim it back.
Dunno, I think I read about the take £500 out in one month to trigger the HMRC tax code and then hit the rest after HL has the tax code. That did seem to work OK for me but it was a few eyars back. I don’t have a problem with claiming it back because self-assessment seems to sort that, and I was doing that anyway. Avoiding the self-assessment route seems to come with different froms of hurt, I suspect that HMRC admin pain is conserved. You can move it from one form to another but not destroy it.
I don’t think I had to send anything off in the mail for that.
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Thanks, it sounds pretty easy. I’ll grab the TFC then later take £1000 of the taxable chunk and see what happens.
It seems like I’m economically inactive as far as HMRC are concerned as they’ve notified me not to do a tax return this year. Their system optimistically predicts I will get some taxable income based on previous – it’s like they think I’m still working for my old employer but not getting pay. They should have got their part of the P45 same as me. Yes, trying to get into the system to do a tax return when needed was a royal PITA, the pain is definitely conserved! I somehow ended up with two of those Gov Gateway online tax accounts in the process.
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Well thanks again I just did the partial drawdown application online.
It was a bit fiddly as I chose cash and a money market type ETF holding to move into drawdown. Because they want a cash value to move up front and get a fixation on that it got a bit confusing with then choosing the investment to move as they then valued it on the previous day, so I had a shortfall of around £100 and it errored. What a PITA way to design it! I thought they would just let you choose the cash and investments to move then work out the TF cash afterwards rather than cast it in stone up front.
So I had to go back and choose a total draw down value less than what I expected it to be based on the ETF value and cash I had so I could get it to work.
Lesson learned is that next time I will just move cash from the SIPP to the Drawdown account and I can put any excess drawdown cash into the CSH2 ETF if I’m to sit on it long term before taking it as income over the year.
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Nice to know how it works when you move stocks to the drawdown a/c, it reinforces my initial feeling I am not clever enough t owork out the values, or what to put on a tax form if it isn’t cash 😉
I’m not really sure of what the situation is with what’s moved into the drawdown account. I interpreted that as if all this nominal cash value is taxable in the current tax year. I coudl see zero incentive to hold it in the drawdown a/c, get is out ASAP and into the GIA (or spend it on sweets and crisps) as you’re paying the tax this year.
implies to me you’re of the view that the tax liability happens when the money is taken out of the drawdown a/c. I don’t think that’s the case. Even if it were, I struggle to see the advantage of unsheltering SIPP funds early. Assuming, that is, you have the expectation of your investments going up?
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It’s only taxable when I take it out of the drawdown account. What I’m doing is phased income drawdown as I don’t need all the tax free cash in one hit. I can just keep crystallising amounts of the original pension and taking the TFC and then draw income out of the drawdown account within the personal allowance when I need to. Advantage is if the funds in the main SIPP grow over time I get more tax free cash than doing it all in one go. Still waiting the “up to 10 days” for the HL system to action it though.
These pensions are so complex especially with the drawdown, if it wasn’t for employer pension contribution match and tax relief it would have been better stuffing more in the ISA.
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> employer pension contribution match and tax relief
Yeah but think of it a a 100%+ bung is always going to involve some extra work 😉
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@DavidV:
My DC/SIPP was not with HL, so my experience may be less relevant to you.
To manage my LTA exposure (remember that?), I fully crystallised my DC/SIPP in one go and took the full [25%] PCLS; the remainder was moved into a [flexible] drawdown account. You may not want to go this route and might prefer to partially crystallise? I have no idea what crystallisation options HL offer.
Subsequently, I have made several ad hoc withdrawals from said drawdown a/c at a rate of one per year. These withdrawals have always been towards the end of the tax year. To date, the quickest execution of an ad-hoc drawdown (from initiation to post tax money in my bank a/c) was 21 calendar days. The slowest took around twice as long and had to be progressed/chased up several times. I have always begun my drawdowns by mid January (at the latest) to manage the jeopardy you identify and so far they have always completed in time.
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@Al Cam
Thanks for sharing your experience. LTA was not likely to be an issue for me and now, for the time being, no longer needs to be considered. HL do allow partial crystallisation and, if I chose flexible drawdown over UFPLS, this is the route I would need to take, otherwise the influx of a further large amount of PCLS into unsheltered accounts would be a tax problem in itself.
At the moment I feel that any benefit I would gain by beginning to empty my SIPP would be small relative to the SIPP’s overall value. It would also increase the risk of fiscal drag taking me into the HR tax band. Like yourself, I’m very keen to stay out of this – its not just the increase in marginal tax rate but also the sudden halving of allowances on dividends and savings interest. The only upside is that I would finally qualify for self-assessment and avoid my current nightmare of HMRC forever using incorrect information with the aggravation of trying to get them to correct this.
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>>It’s an absolute doddle
Thanks for that on pulling the ££ out of the HL SIPP.
I was indeed going to do the phased drawdown with the separate account and if I keep mostly cash in it I don’t think I’ll be hit big time with the 0.45% capped additional charges on the drawdown account. I just have some of the cash “parked” in the Lyxor CSH2 ETF which I will crystallise too and start taking bites out of – the returns of about 5% on that will be eaten into by the 0.45% charge so I have some maths to do as to whether I should cash it as HL pay a little more interest on cash in the drawdown account (ah quick check – it’s less than the CSH2 ETF returns less the fees – https://www.hl.co.uk/charges-and-interest-rates)
I had a look at doing the drawdown on the website but what bugged me with HL was out of all the blurb they send about how the drawdown works they don’t actually show what happens with their site as to what you do with it, how stuff in the SIPP is moved over, what happens when I proceed with their online form etc – the mechanics of it. So I click through so far to see how it goes then cancel before the commit stage to figure it out.
I had a look at UFPLS and that was my initial plan for just withdrawing cash dividends but it looks like a bugger load of paper form pushing from reading around various forums and the drawdown account is more accessible online AFAIK.
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@Bill,
I have just seen you post from 08:27 on 21/1/24.
My post from 09:06 on 21/1/24 to @DavidV (below) may well also apply to you.
And, seeing as you already have at least one gateway account, you should already be able to get to your PTA.
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@Bill
Thanks for sharing your experience so I don’t make the same mistake if I eventually go down the partial flexible drawdown route with HL.
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Re Bills experience (dated Jan 24) and @ermines comment:
As I said before my [erstwhile] DC/SIPP is not with HL. So my experience is not perhaps directly comparable. However, FWIW my view is that the tax is calculated and due when a cash withdrawal goes through payroll. I am fairly sure this is correct as in my case when I crystallised all my [DC/SIPP] funds (bar the PCLS) were moved to something called a drawdown account. These funds were and still are fully invested – ie they are not cash. Over the ensuing years only my subsequent annual ad-hoc [cash] withdrawals have been taxed.
My withdrawal sequence basically goes as follows:
a) phone up provider to initiate process (this call takes somewhat longer that you might assume as they have an ever increasing set of questions/etc to work though); a useful thing to establish during this phone call is their anticipated execution timescales and advise them of your needs (reminding them about minimising my time out of the market has served me well);
b) request a gross amount and identify which investments to sell (paper form or online: I have used both and found the online version – which was only made available last year – to be so awful that I have reverted to paper again this year);
c) provider works out how many units to sell;
d) units are sold, payroll runs and in due course I get the net proceeds paid to my bank a/c.
Any over payment of income tax is then reclaimable, by me, from HMRC. I happen to use SA for this. To date, I have over paid income tax every year; but this year may (and I stress may) be different. I should know the answer to this point in a few weeks as I am part way through my latest ad-hoc withdrawal.
A key lesson since I crystallised my DC/SIPP is that nothing with SIPPs is ever straightforward or speedy in practice even though it appears that it should be! My limited research indicates problems are wide spread across providers. Personally, I am amazed that there is so little push back from the punters.
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> However, FWIW my view is that the tax is calculated and due when a cash withdrawal goes through payroll.
Gosh. It seems my understanding was wrong that tax is crytsallised on sheltered -> drawdown a/c. Not sure where the opportunity is here, but certainly something to mull over
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@Al Cam – Interesting to hear your experience on the SIPP drawdown. I have so very few retired friends doing SIPP drawdown who can share the experience. One friend has an adviser doing everything, it shouldn’t really be necessary for the additional expense when people are capable of handling all their other finances. He worked for a fund management company so the adviser may be on a discounted basis.
The HL process seemed pretty similar but done via an online form with lots of risk questions and warnings. It will surely be actioned by a person on the back end to check it all over. I’ve found in the past they can make mistakes but usually they’re very good at putting things right – like with a messed up Bed&ISA instruction a few years ago. I’ll have to see how it goes. I’m just trying to pull dividend cash out of the SIPP initially. Getting dividend cash out of the ISA looks a lot easier!
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> It will surely be actioned by a person on the back end to check it all over.
It’s easier and quicker subsequent times. You still have to answer the CYA questions – I mean serious Mr HL, sure I am drawing down > 50% of the SIPP but it’s now only worth £3600 tops so it’s not the only thing keeping me from sleeping under the railway arches, thanks for asking…
I’m fairly sure I don’t have any dealings with a real person. Unike the case when my VWRL comes over from Vanguard into the ISA as VWRD and I have to get one of their geeks to go fix it. Each and every time
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@Bill,
I had specific reasons for fully crystallising my erstwhile DC/SIPP. These primarily related to the [possibly] now defunct LTA. Also, I struggle to see any practical difference between phased crystallisation (aka phased income drawdown) – as you are doing – and UFPLS. What have I missed?
> One friend has an adviser doing …
Agree DIY should be possible, but IMO there is a lack of detailed info/experience available for people to consult. It was even worse several years ago when I started. Back then I did, very fortunately, find one very good (and largely unexpurgated) post. However, that post has since been put behind a [possibly pay per view, but I am not sure of that level of detail] paywall. IMO that development is a bit sad. Anyway, this is why I am happy to share my experiences both good and bad. And IMO the key lesson is nothing to do with SIPPs is ever as straightforward or speedy in practice as it appears it should be – irrespective of the provider!
> Getting dividend cash out of the ISA looks a lot easier!
It sure does, but I cannot see why you would go that way until you had burned up all of your income tax personal allowance. And even then, IMO it might not be no brainer to tap the ISA. Would it not just be better to re-invest your ISA dividends.
On the same theme, your unit holding strategy intrigues me? I only have distributing units in my GIA. I hold accumulating units and some cash in my ISA and erstwhile DC/SIPP.
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@Al Cam – answering some of the things that came up..
>> practical difference between phased crystallisation and UFPLS. What have I missed?
For me it’s down to the way HL do it really. For UFPLS it seems like I would have to keep filling an actual form every time I want to withdraw. With the flexi-access drawdown I can do it online as @Ermine has kindly indicated. I have also spent hours researching this on various YouTube channels (some by advisors!) and forums like Lemon Fool and CityWire as well as reading all the HL bumpf they sent me. Repeated partial drawdowns however give more flexibility re. tax positions I think with taking the taxable part as you don’t have to take all of it when crystallising a given amount as compared to UFPLS. I think it will make it easier to plan towards the end of tax year in case of any other taxable income coming in, e.g from unsheltered GIA and cash. Like if one was to be selling a surplus residential property and stuffing some of the proceeds into a GIA account using INC units of VLS80 or something.
>>Would it not just be better to re-invest your ISA dividends
Yes, that is what I am doing at the moment until GIA and unsheltered assets are used up.
>>your unit holding strategy intrigues me
In the few years before my retirement I adjusted the SIPP and ISA into ETF funds and investment trusts that pay out dividends (not so much with VWRL but I have some VHYL and even VGOV was paying 3% last time I looked). I know it’s debatable but I just prefer taking the dividend yield for cash income initially rather than selling funds at £11.95 a hit with HL. Also the ITs pay more predictable dividends especially the dividend hero ITs like MRCH. If I was in my 30s it would be ACC units all the way to near the finish line!
>>nothing to do with SIPPs is ever as straightforward
It should be easier shouldn’t it? With DC pensions becoming more prevalent I can imagine some of my younger colleagues from the old workplace being flummoxed when they come to retire and discover getting the cash out of a SIPP isn’t just like a bank account where they can do it all on a phone app. Maybe some AI font end will help with this!
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@Bill,
Thanks for the additional details on your unit holding strategy. I can now see where you are coming from and trust that HL’s excessive dealing charges are not unduly influencing you?
To date I have always done my erstwhile DC/SIPP withdrawals towards the end of the tax year. Like you, I do this primarily as I have a much clearer picture of my income tax situation towards the end of the tax year.
I noticed you also mentioned Bed &ISA. OOI, do you prefer to do these transactions towards the start of the tax year?
>It should be easier shouldn’t it?
Yes it should.
However, my (albeit limited) experience is that it is getting worse rather than better, with ever more fatuous box ticking hurdles. A favourite nonsense is their insistence that I have to be issued with an entirely meaningless (multi page) quote before I can submit my forms.
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>I suspect that HMRC admin pain is conserved. You can move it from one form to another but not destroy it.
I love your law of conservation of HMRC admin pain. I would just like the opportunity to experience the SA pain as I’m weary of the alternative.
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https://www.gov.uk/check-if-you-need-tax-return
I fall into the potential category because I get more than £10k from savings and investments (outside the ISA, natch) and pension income > BRT threshold, though that in itself is largely dealt through PAYE.
I did consdier dropping off that, but after hearing the grief that some of you are having I came to the conclusion that SA is the lesser of two evils. I use taxcalc individual. You don’t have to do that, but it makes submitting and checking CGT a lot easier. But I have done it online using just the HMRC website, though that was easier because I had only earned income and no non-ISA investment income at the time. You can do CGT and dividend tax using HMRC online but once you get into the realms of CGT then I found it easier to stick with SA. Even if your gain is less than the annual allowance if your sales are > a different threshold (50k at the moment) then you still have ot report it.
I use taxcalc to do all this shit because: life is short. TC prepares the additonal cruft to show the working and submits it
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@ermine
I regularly check that eligibility tool and (sigh) I still don’t qualify for SA. If interest rates don’t go down too quickly there is the possibility that my unsheltered interest and dividends combined may exceed £10k during the next tax year. When you look at the tool in detail, though, the question requires dividends or savings and investments separately to exceed £10k. Oddly their definition of investments here does not include dividends!
I try very hard to keep within the CGT annual exempt amount (AEA) by switching between similar funds. I miscalculated once when I did not fully understand the role of equalisation in the CG calculation. I may also get caught soon by a corporate event landing me with an unplanned capital gain. For these occasions I keep a ten-year-old HMRC letter metaphorically in my back pocket that records a loss from a share I once owned going to zero value. Ironically the requirement to report any disposal greater than four times the AEA only applies if you are registered for SA (£24k this year, £12k next year). HMRC obviously don’t want oiks like me clogging up their phone lines or writing letters to them if I don’t actually owe them anything.
@Al Cam
I have had a Personal Tax Account (PTA) for many years. I find it useful for some things and totally useless for others. For example, when I ceased working in June 2017 and initially lived off my redundancy payment, I made my in-year tax reclaim using the PTA. The repayment was made accurately and very quickly. Prior to reaching state pension age it was also very useful for accessing my state pension forecast. Its biggest limitation IMO is that, although you can view a couple of previous tax years, you can only provide updates for the current year. This means that you can’t use the PTA like a tax return and provide accurate figures for the tax year just gone when you have all the statements.
I usually try to phone them in Jan/Feb when I have a reasonable estimate of my dividends and interest to sort out the mess that my tax code has usually got into by then. Despite the pain of holding on the phone for ages it is usually better to phone as the code gets updated instantly and you can plead with them to give you a normal cumulative code rather than a month 1. A month 1 code perpetuates the pain and confusion by carrying any underpayment forward to the next tax year. This year, exceptionally, and for various reasons relating to earlier HMRC c**k-ups and receipt of a wildly wrong new tax code, I used my PTA to provide my best interest and dividend estimates on 22 Dec. I’m already regretting it as nearly a month later there is still no change to my tax code. When they do eventually process the information I’m almost certain they’ll give me a month 1 code necessitating a phone call anyway.
My state pension (including protected payment) does indeed exceed the personal allowance. This is no problem though as the amount merely comes off the tax code used for my DB pension (just as it would do even if my state pension were below the personal allowance). And, yes, I do have a negative tax code as a consequence of this and dividends/interest! HMRC get the amount for the SP automatically. The only slight niggle is that although I receive my SP four-weekly, it is always quoted and calculated on a weekly basis. Tax is supposed to be paid on the basis of weekly eligibility. When you receive your SP you will find that the annual increase actually occurs two weekly ‘paydays’ into the tax year. The amount HMRC uses usually assumes only one week, and sometimes no weeks depending on where you look, at the old rate. I’ve long since decided it is fruitless to try to correct or receive an explanation of this small discrepancy as HMRC blame DWP and DWP blame HMRC!
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Blimey, all my working life I avoided SA like the plague (it was the initial kick up the ass to start using ESIP and AVCs) but if I were faced with that much pain I’d sell a few circuit boards on ebay and return to the ranks of the self-employed.
The limitation of the PTA of the current running tax year seems a serious limitation, my GIA and even things like Raisin only produce the tax statement a couple of months after the tax year end
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@DavidV,
Interesting.
Agree PTA only allows you to edit current years tax code. But that was more than good enough for me and my final (not estimated) figures will subsequently be lodged via SA. HMRC’s estimated figures for me following commencement of my DB pension (and before I intervened via PTA) were ludicrously wrong – think factor of more than two wrong in HMRC’s favour!
I am not sure what has happened in your recent case, but for info, my recent PTA experience went as follows:
a) I updated/corrected various estimated values online in PTA on 21/9/23;
b) by 7 am on 22/9/23 changes had been processed; albeit not as I intended (issue was primary pension);
c) 25/9/23 I spoke to HMRC on phone – took about one hour start to finish – most of which was waiting time;
d) later that same day tax codes sorted as required;
e) over the next week or so I received (by post) two sets of tax codes; wrong ones, followed by correct ones
f) subsequent DB pension pay slips have had correct tax code and all back tax owing has been paid to me
OOI, can you also access your PAYE info? I ask as I found it interesting to note that HMRC are advised [via payroll I assume] before you are of what you will receive in any month. This is a convenient way to keep an eye on what tax has been deducted from any income drawdown.
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@Al Cam
I can access my PAYE information in my PTA but I’ve never used it to keep an eye on tax deducted on a month-by-month basis. My DB provider sends me a pay slip well in advance whenever the net payment changes by more than £5 from the previous month.
My issues usually revolve around HMRC getting my savings interest for the previous year completely wrong. They are supposed to get this information from the banks but it is invariably wrong or missing some accounts. They are usually not very interested if you try to tell them directly in advance, but I sometimes call to report my actual dividends for the previous year and manage to check (correct) the interest values they have at the same time. They usually issue my P800 tax calculation for the previous year in November, but I logged in in early October to find it had already been (incorrectly) calculated on 2 Oct and I was due a (too high) refund. I immediately phoned and they produced a new, correct calculation dated 10 Oct with a lower, correct refund which I claimed and received. So far so good.
Then, out of the blue, in the middle of December I receive a new tax code dated 6 Dec for the current year – based on the original, incorrect 2 Oct tax calculation of last year! My tax code was already set to cause me to substantially underpay tax until my ritual Jan/Feb call to put it right. This new tax code only worsened the situation and caused my Dec pension payment to be ridiculously high with the incorrect tax reduction.
So close to Christmas I could not face phoning them, so used the PTA to provide realistic estimates and still I wait.
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@DavidV,
I think there may be another route you can use to sort out these HMRC related problems that does not require you to be eligible for SA, specifically your Personal Tax Account (PTA), see e.g.:
https://www.litrg.org.uk/tax-guides/tax-basics/digital-services-dealing-your-tax-and-tax-credits-online#toc-what-is-my-personal-tax-account-
I used PTA recently to help sort out my tax codes. It worked, to a point. However, I did have to make one phone call to finally crack it. Having said that, I suspect our cases are rather different. For example, your state pension (SP) (which IIRC includes a ‘protected payment’) may exceed the personal allowance. Whereas, I am not yet in receipt of my SP but I am enrolled in SA.
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@DavidV
> There have been a number of discussions here, I think, and elsewhere of emptying the SIPP ASAP within the BR tax band (or the personal allowance if there is little other taxable income) and investing in a GIA. I have been reluctant to …
To try and explore this a bit more:
My objective is to shuffle my DC/SIPP into an ISA as tax efficiently as possible and ideally never pay more than 20% income tax to do so. The GIA involvement in my scenario is incidental and came about as a direct result of electing to start my DB pension earlier than I originally planned. If I understand your strategy correctly you have prioritised shuffling your GIA into an ISA. Is that about right?
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@Al Cam
Yes, that just about sums up my situation. It will take me several years yet to empty my GIA and the cash savings I regard as part of my investment ‘bond’ allocation (i.e. cash not earmarked for emergency fund, replacement car, home maintenance etc.) into my ISA.
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Yup, IMO it is a tricky judgement that not only depends on your particular set of circumstances, but also (to some extent) your own view of how the future might unfold. I do wonder if any of us will reach our desired destination before the rules change again; lets see what – if anything – the 6th of March brings.
As well as the “sudden halving of allowances” you mentioned above crossing the higher rate threshold disqualifies you for any married persons allowance too.
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Hi,
Hope I am not too late to wish everyone a Happy New Year.
I do an UFPLS every year from my SIPP with Hargreaves just after the start of the tax year, so super early. Thought you might like to hear the process for comparison.
I just decide how much I want as income each month and do a few calculations to work out what my UFPLS withdrawal from my SIPP should be, remembering 25% will be tax free.
For example, I say calculate I need to make a UFPLS withdrawal of £24,000. I would need to have cash for this sitting in my SIPP, which I would have arranged buy doing the necessary selling beforehand.
I fill in an illustration request form with Hargreaves about a month before the start of the tax year, which prompts them to send me an illustration.
When I received that I phone them to go through a series of risk questions with them, so they record my answers. (A phone call, based on experience is quicker than filling a form in and waiting for them to receive it, hoping it is not lost. They tend to be busy arounf this time of year.)
Then on the first day or two of the tax year I send of the UFPLS request form to them and hopefully the money appears in my bank account several weeks later.
They would, in this example, send one amount of which 25% (£6,000) is tax free and rest (£18,000) would be taxed, as if I was withdrawing £18,000 per month, every month, for the rest of the tax year, so massively over taxed!
They send out a withdrawal confirmation, to tell me the tax I have paid.
The time between the start of the tax year and receiving the UFPLS money in my bank account I normally chase round for tax certificates for any interest I have been paid on saving and tax on dividends.
Anyway, once I have the documents all in order and the UFPLS payment and confirmation form, I complete a P55 tax form to claim my tax back from HMRC. That includes a covering letter telling them how much interest and dividends I received last tax year, which they take as the estimate for what I will receive this tax year.
It is essentially the same as filling in a paper self assessment tax return, but which they have never wanted, since they get my P55 instead. So agree the HMRC tax admin pain has been conserved. HMRC are genrally good at doing the calcs and issuing a tax refund.
I then put the net amount along with the tax refund from HMRC into a saving account and just draw it out each month over the following 12 months.
Like others have said, it is difficult to know how much to withdraw. Should I draw out more than I need over the next 12 months, to try to run down my SIPP while I am a basic rate tax payer or not? It seems impossible to know.
It all seems quite easy and I just repeat this each year. My SIPP, apart from the UFPLS withdrawal money being removed from it, carries on as normal and I even pay in the £3,600 contribution into it that I have always been making every tax year.
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@Jam
Happy New Year. Thank you for documenting how UFPLS works with HL. We now can directly compare the UFPLS and flexible drawdown processes from the same provider. Are the forms you mention all paper forms, or can any of it be completed online? Can the P55 tax reclaim be done through your Personal Tax Account? Tax reclaim is one thing that I did find worked well online.
I also continue to contribute £3600 gross per annum to my SIPP as part of my plan to shelter my GIA and cash investments as quickly as permitted.
@Al Cam ”That is, it might be better to pay tax now at BR to avoid tax at HR down the line. Easy to say, but not so easy to calculate!”
@Jam ”Should I draw out more than I need over the next 12 months, to try to run down my SIPP while I am a basic rate tax payer or not? It seems impossible to know.”
Of course, the primary tax consideration is the rate paid on withdrawing from a SIPP. However, I’m also mindful that, if the money is not to be immediately spent, it adds to unsheltered investments and produces more interest/dividends that take me ever closer to the HR threshold. Inflation has been a double whammy with frozen tax thresholds – not only have the inflation increases on the SP and DB (5% capped) taken me nearer to the HR threshold, but the accompanying high interest rates mean that savings interest is more than I ever envisaged. While the increased income is welcome, I never imagined a couple of years ago that I would ever be in danger of approaching the HR threshold. Hence my reluctance to add to unsheltered investments until inflation is tamed and the thresholds start increasing again..
Part of my routine is to have a Wetherspoons lunch after swimming twice a week. Every year they have a Burns weeks so, as in previous years, I ordered their haggis offering. Although I was also there on Thursday, I chose to have the haggis on my Tuesday visit before they had a chance to sell out. I’m no connoisseur it seemed pretty good. I hadn’t heard of the haggis supplier (I’m a Yorkshireman living in the south-east) but they claim it to be a renowned name.
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Or put away in an ISA, such that is forever [at least in theory] henceforth tax free
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@Al Cam
“Or put away in an ISA, such that is forever [at least in theory] henceforth tax free”
Of course, but I was describing my own situation where I already have sufficient unsheltered investments that will take several years to get into the ISA (plus £3600 into the SIPP). SIPP withdrawals would add to this time, all the while exposing me to the danger of fiscal drag.
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@DavidV,
Indeed.
As I think I said elsewhere what to shelter when is a tricky call that is very situation/scenario dependent.
I think a key difference between our scenarios is that, unless something changes, when my state pension (SP) commences in a few years I will breach the HR threshold*. For info, this is the case assuming either Nov ’23 inflation forecast from the OBR or the BOE. This is primarily what is driving my to strive to empty my erstwhile DC/SIPP prior to my SP starting. Ideally, I will have flattened my GIA by then too, but if not: so be it.
Like you, I did not exactly see this coming, but cottoned on pretty quickly.
The fact that I chose to start my DB earlier than I originally planned also, in some ways, complicates things. But OTOH it also means my HR exposure at SP commencement will be lower than it would have been.
As I said, it is tricky and of course all subject to change as and when ‘the rules of the road’ are changed.
*IIUC in your scenario your BR headroom is decreasing year-on-year, but you might not actually hit the HR threshold assuming [threshold] indexation is re-introduced in April ’28 . Apologies if I have got this totally wrong.
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@Al Cam
Your understanding of my situation, described in your asterisked footnote, is, as usual, spot on. The alarm bells rang when I realised that my interest on unsheltered cash is set to be more than double what it was last year. If that level of interest rates continues, and inflation-linked increases on SP and DB continue to be high, then the HR threshold could be breached before 2028. If inflation and interest rates moderate then I am probably safe.
Of course, I would take some defensive action before it got to that point – shuffle my platform/asset allocation to buy more global equity (relatively low dividend) in the GIA and more short-term gilt ETF in lieu of unsheltered cash in the ISA. £50k of earmarked cash savings (non-investment but for maintenance, emergency etc.) could be put in premium bonds to lower further the taxable income. If short-duration low-coupon individual gilts are still available when needed, that is another wheeze to lower taxable income (taking most of the return as CGT-exempt gilt capital gain rather than as coupon income).
In your case, is there merit in deferring your SP until thresholds increase (in 2028 or hopefully earlier)?
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Both the BoE and OBR forecasts show inflation moderating. However, since inflation began to pick up both of their forecasts have been consistently wrong (remember “short sharp shock”, etc) and inflation has been far stickier than they foresaw. What would be most helpful for me would be for HR threshold indexation to be re-introduced much earlier than April ’28.
Re: delaying SP commencement; my SP start date is in ’29. A lot can – and almost certainly will – change before then. However, my crystal ball, even at it’s very best, is extremely hazy! For example, I never thought that the LTA would be removed.
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To clarify, prolonged inflation and the worsening inflation forecasts (from the OBR & the BoE) have changed my situation from being borderline (around March ’23 using a somewhat earlier inflation forecast) to most likely exceeding the HR threshold (current actuals and Nov ’23 forecasts) on SP commencement.
This [inflation only] situation could possibly change back again; but the direction of travel, to date, has been very clear. And, as noted earlier, what would be most helpful for me would be for HR threshold indexation to be re-introduced much earlier than April ’28.
Time will tell.
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@Jam –
Belated Happy New Year and thanks for the info on how the UFPLS works with HL.
My partial drawdown with HL has progressed and is almost complete, just waiting for tax free cash to show up in the bank. So I’ll just summarise how that worked if it helps anyone.
I kicked off the partial drawdown online maybe a week ago. All the risk questions were done online and I chose an amount of cash and a single ETF investment to transfer. The investment was the CSH2 Lyxor Smart Overnight return ETF I had parked some dividend cash in to get a little better return than the HL cash interest rates.
What I found out is the drawdown is set on a fixed £ value amount at this point. I also had to choose a “balancing” investment they would sell some of in case my ETF went down and I had a shortfall on the drawdown amount.
What they don’t do is have a plan for what to do if your investment goes up and is worth more than the value it had when applying for drawdown! What the CSH2 ETF generally does is go up a small amount every day. So my drawdown application stalled with a secure message asking me to contact HL to tell them what to do.
The obvious thing was transfer all the ETF and reduce the amount of cash to transfer. A shame to leave some behind though! So I phoned and impressively they answered after a couple of rings and I explained what I wanted them to do. Within an hour of that call ending my account was showing a SIPP drawdown account with the ETF and cash less the tax free amount.
What I learnt from this is it is better to just choose cash to transfer to the drawdown account during drawdown application as per what @Ermine does. Then buy the CSH2 ETF or whatever inside the drawdown account for any cash that will sit there long term before taking it as taxable income. I think the online application will always stall with the secure message query if any investments chosen for drawdown go up in value. The other thing is to avoid unnecessary transaction fees if they sell investments to make up a shortfall on the drawdown amount.
After all that I got a secure message with details of the drawdown and % of Lifetime Allowance used up. It worth keeping records of this outside the account.
So the remaining thing is to see how long the TF cash takes to arrive in my bank – they say “it will be sent shortly”. HL don’t seem to do faster payments much to their benefit I’m sure!
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HNY to you too!
Did you celebrate Burns night yesterday? I didn’t, but I did have some haggis and pork sausages a week ago – and they were far better than they sound.
Very interesting and thanks for sharing your drawdown experience. I’ll bet you are initially massively over-taxed!
To my eyes, the key issue is how you view your likely income tax rate in the years ahead. That is, it might be better to pay tax now at BR to avoid tax at HR down the line. Easy to say, but not so easy to calculate!
Thanks again for sharing – we can all learn from each other.
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Thanks. I enjoyed reading and learning about other people’s experience of drawing their SIPPs, so was happy to share my own UFPLS experience.
I still have the option of flexible drawdown on my SIPP, so useful to know more of how it works if I decide to go that way in future.
Hargreaves were very good when I first FIRE’d. I had my SIPP with them, but since I FIRE’d part way through the tax year, just lived of savings for the rest of that tax year.
The second tax year Hargreaves let me split my SIPP into ‘small pots’. You can withdraw 3 small pots of £10k each withou triggering the MPAA. That allowed me to kick the can a further 18 months down the road, before properly doing an UFPLS and triggering the MPAA. By then I felt much happier that I wouldn’t go back to work or need to contribute to a pension again, so it really helped.
No burns night celebrations this far south. I just can’t contemplate haggis!
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That’s quite a remarkable trick. As you experienced, it helps with the initial transient of leaving work, keeping the door open if you do need/want to, to retain the MPAA. That’s a little bit less critical now that it’s 10k rather than the paltry 4k which was only just above the £3600 a total non-earning slacker like myself could get, but it’s neat to be able to retain the option and give everything time to settle in.
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Neat move re the ‘small pot’. I knew the rules about small pots but I have never seen that move before. Really good to share.
I assume JAM and sls6852ec34bc7d are one and the same person?
>I just can’t contemplate haggis!
Horses for courses. Bad pun – but true story – follows: I must admit that the first time I ever ate horse it was by mistake, but it was good.
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@sls6852ec34bc7d
Congratulations on the small pot move!
@Al Cam
Re horsemeat, I was on holiday in Sardinia a few years back. Lunch options where I was staying were limited if you did not want a full restaurant meal. I was in the habit of using a fast-food stall between my hotel and the resort centre. Fancying an alternative to my usual choices I was intrigued by the horseburger, imagining it was a mistranslation or possibly a reference to its size. Caution prevailed and I did not order it.
Back at work I related this to a much younger Italian colleague. He deftly opened Google StreetView and recreated my lunchtime walk to the stall. There he focussed in on the menu on the wall (in Italian and English) and confirmed that it was indeed horse!
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For said sausages, see: Robertson’s Pork & Haggis Sausages And Asda Sweet & Creamy Root Veg Mash ~ Food Review – YouTube
FWIW, I baked them in the oven for c. 30 minutes (turning half way through).
And whilst they do have a lot of pepper in them – which I happen to like – I thought they did have a faint taste of haggis.
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>I assume JAM and sls6852ec34bc7d are one and the same person?
Hi, yes, I don’t know why it changed my name?! Then it seems to have deleted my last reply. Fingers crossed for 2nd time lucky!
@DavidV This link takes you to HL’s UFPLS pages, then just fill in the ‘get a quote’ details.
https://www.hl.co.uk/retirement/ufpls
I actually requested several quotes one year, before deciding which one to go with. So requesting the quote can be done on-line, but the pack(s) is/are snail-mailed out to you.
I recommend doing the risk questionnaire over the phone. The only problem is the questions are so basic they make me want to roll my eyes. However, I just smile sweetly, because the poor person is just doing their job. The questions are not aimed at us FIRE types.
I tried to complete a tax reclaim on line a few years ago, but that all went pear shaped. I don’t think HMRC’s system was up to it. Maybe it has changed, but the form is very simple and I have a standard covering letter I send with it that I just update the figures each year, so it is not a big issue for me.
FWIW, I got an air fryer last week and my first impressions are it s brilliant. So much quicker than my gas oven. I haven’t tried sausages in it yet though.
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@Jam
Thanks for the further information on HL’s handling of UFPLS.
I’ve also been thinking a bit more about Air Fryers recently. There have been a couple of TV programmes about them recently. When they first became popular I read somewhere that they are definitely more economical if you have an electric oven. The situation is more marginal though if you have a gas oven, as I also have.
If they cook much faster, though, as you say yours does, it’s definitely worth another look.
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@ermine
Re: check if you need to do a tax return
>I fall into the potential category because I get more than £10k from savings and investments (outside the ISA, natch) and pension income > BRT threshold, though that in itself is largely dealt through PAYE.
I think you might also potentially fall into the fun zone of approaching/breaching the HR threshold when your SP comes on stream. By my calcs a total taxable income now of around £30k before your SP commences in a handful of years might make you borderline (assuming a full SP). OOI, this £30k figure was nearer £32k last March.
Having said that, some of the defensive moves, along the lines of those outlined above by DavidV, could possibly help.
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Yup. But I have a very large ISA, and a very minimal SIPP now. Obvs I don’t draw from the ISA at this stage. I take income from the DB pension, and there is income from the GIA, though at the moment it simply provides as income/a little CG my annual ISA stake with a little over. I harvest CGT and probably need to think about shifting emphasis to maximise both.
I have offed my cash savings out to Mrs Ermine, I would rather she takes all the interest tax-free and spends it on sweets and crisps rather than I get it with the taxman getting his 20%. I know it’s irrational, but so what. I am large, I contain multitudes
I note that income tax on dividends is less than half that on earned income, and indeed on the laughable concept of interest on savings which may or may not preserve the real value. There may be opportunities for cash like investments to make the ‘interest’ on cash appear like the dividends on investment thus halving the tax rate
I would expect the GIA to drop over the time to getting the SP, I may defer the SP if that makes sense given my state of health and strategy, though there’s much less to be gained for me there since I do not have the vexed problem of creating a dynastic legacy to children that I expect to be living through the decline of the West. I’m aware deferring the SP would make me approach the HRT threshold more in later life, but the hazard in my case is from the income from the GIA, and that is elective. F’rinstance I could move the GIA all into gold which makes it a pure CG play (assuming that Britian doesn’t suddenly fin it’s mojo as Liz Truss fondly believed and the currency skyrockets). Then when I cark it, since CGT is revalued on death Mrs Ermine could inherit it tax-free
I would expect other things to change between now and me drawing the SP, it is possible/probable that the tax position of investments may change adversely. I then need to consider if I should simply start blowing it on high living than feed the taxman, or find more causes I care about, perhaps mustelids need a helping hand so I get to see them in my dotage.
There are no clear answers in the face of that sort of uncertainty. I do see the rationale for holding physical gold but it has the same danger as gazing into the abyss, it changes you a little bit as outlined in LoTR, and the Telegraph is full of crabby old Boomers whinging about tax that this troubled world doesn’t need any additions to their rank. I am already drifting that aways in this comment. Basically if I am rich enough to worry about the HRT threshold in retirement, then I am doing one hell of a lot better than most of my fellow countrymen. Sometimes it’s good for the soul to show some gratitude, eat some lobster with the people you love and keep calm and carry on. When I look back at the desperate times out of the GFC when I thought the tail risks were spending a significant proportion of the last ten years stacking shelves at Tesco I need to do the gratitude thing 😉
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>Basically if I am rich enough to worry about the HRT threshold in retirement, then I am doing one hell of a lot better than most of my fellow countrymen.
Please do not get me wrong, this is clearly not the worst problem to have. Having said that forearmed is forewarned, etc.
>but the hazard in my case is from the income from the GIA, and that is elective.
Agree
I just reckon a lot of folks are unawares of how insidious fiscal drag in the presence of elevated inflation is/could be. It still surprises me how relatively low the barrier to the ‘fun zone’ (c. 60% of the HR threshold) is for people due to draw their (assumed full) SP in a handful of years.
>I would expect the GIA to drop over the time to getting the SP …
Well this might happen as a consequence of progressively sheltering it into your ISA, but you will have to restrain you tendency for wheezes like shorting, etc
>I would expect other things to change between now and me drawing the SP…
Agree
Some other admittedly rather low level and/or detailed thoughts:
a) pay no more voluntary contributions and force SP to be less than full – although I think this horse has bolted in your case and in terms of VFM even at Class III rates it appears, at a first look, rather daft
b) note that if inflation returns to previous more normal levels your DB being RPI indexed edges you a bit further ahead of CPI(H) each following year (and might even eventually repair your recent DB erosion vs CPI(H))
c) triple lock has generally exceeded CPI(H) too
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@ermine
I note that income tax on dividends is less than half that on earned income,
That is indeed true and is a consideration when deciding what investments to include in the GIA. However, it has no bearing on the hazard of breaching the HRT threshold that Al Cam describes. All income is totted up, ignoring such features as the dividend tax-free allowance and personal savings allowance. If the threshold is breached, not only does the tax on the excess double but the two aforementioned allowances halve.
If breaching the HRT threshold is a realistic possibility, then the priority is to allocate the investments with the lowest income outside the tax shelters. As you have an allocation to gold, this is an obvious candidate. Of course, this can be arranged nearer the time when exceeding the threshold seems inevitable. In the meantime it is worth having a good part of your equity allocation in the GIA because of the favourable taxation of dividends you mention. Of course, this has to be balanced against the other issue of diffusing capital gains within the ever-decreasing CG exempt amount.
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the gold is already out there. I churned it twice around this time last year to use my 12k CGT allowance. Obvs I lost the spread and the dealing cost but a bird in the hand and all that. I’m still far enough off the SP for it not to be a concern at the mo, but I note AlCam’s distant early warning alarms that this bell may toll for me!
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Please note that my point b) above [re RPI] is only good until 2031 because as of February 2030 RPI index values will be calculated using the same methods and data sources that are used to calculate the CPIH. Please note I assume your DB scheme uses the previous years RPI value from September for indexation in April. IIRC @ermines DB scheme uses a month other than September for RPI indexation purposes.
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@DavidV,
Thanks for the clarification and it may also be worth noting that you also lose any entitlement to claim any married persons allowance if you breach the HRT.
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@ermine
Just to clarify, you said
>I harvest CGT
and then went on to say
>I churned it twice around this time last year to use my 12k CGT allowance.
Does that mean you effectively defused your capital gains allowance and did not spend it as income?
The reason I ask is that I just wondered once you are in receipt of your SP will your GIA [and/or unsheltered cash] not possibly start to increase again as you currently might not need all the SP as income?
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The churning of the gold was purely to use up the 12k CGT allowance, that in principle gives me future space for CGT, or, if the GBP rises like the ghost of Liz Truss demented dreams then a future loss I can set against something else. At the moment my DB pension is enough to live on, I have occasionally used some of the GIA investments to improve the situation for others and the occasional toy but my needs are OK.
Having said that, I acknowledge that I am in good health at the mo. This article indicates that agewise now is the time that this generally changes for the worse, so while I would currently not need any of the SP this may not hold in future. I am not in the younger half of that bracket 😉
I do some things for myself that people in my age cohort generally don’t – things like plumbing and basic repairs, I have filled three council garden waste wheelie bins with hedge clipping this year alone trying to get in there before the birds, most people get someone to do that. Every darn time I replace a wooden fence post I ask myself why I am doing a tiresome job which is at the limits of my upper body strength when I am easily capitalised enough to pay some young fellow to do this grunty job for me rather than putzing about with SDS+ to extract the old post and break out the concrete. The problem is finding a reliable young fellow for that sort of thing.
I don’t work on cars anymore, I’ve done my time of changing the water pump in winter by the side of the road and replacing clutch cables 😉
I don’t know how much that saves me. All of these things involve labour, and that isn’t going to get relatively cheaper in future. I have seen in my peer group the slings and arrows of health outcomes limiting what others can do, in some cases dramatically, and in a few terminally. And I do experience some fading myself – for instance I’ve undoubtedly lost peak strength but it is also easier to pull muscles and the recovery time is longer than when I was younger.
Living well is a balance between consumption the preset and the future, there’s some case to be made that I am underspending. But as some wag said years ago, the greatest consumer good is free time and enough to enjoy it.
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Thanks for the clarification.
The article reminded me of the go-go, slow-go, and no-go model of retirement/aging. In this model (in general) whilst the need for paid support (inc. medical needs – which one may well choose, or even need to, pay for) increases as you age, other spending also tends to drop off to, at least, compensate; e.g. holidays, eating out, etc. Having said that we are all a bit unique. On average, we all – of course – have less then two legs!
I reckon we are of a similar vintage, and I will admit paying for plumbing and even decorating nowadays. I never really did serious car maintenance. Having said that, I still do the gardening (except tree surgery) and some other forms of general maintenance. It is also clear I just ain’t as strong/fit/resilient as I used to be. Having said that, I do still seem to have about enough time to make it work.
>The problem is finding a reliable young fellow for that sort of thing.
100% agree and if anything this seems to be getting worse.
Long may your good health continue.
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> the go-go, slow-go, and no-go model of retirement/aging
I read that a while back, and it didn’t feel my tribe. The go-go crew were extroverts with an external locus of control spending out, they were what they did. Nothing wrong with that if it’s your bag, but it ain’t mine. What I want out of a day is to be changed somewhere. I want to learn something new each day. It doesn’t have to have any point – today I learned how to set the alarm on a DS3231 chip using Python on a Raspberry Pi, eventually I may use it to put some recorders out in the woods to track birdsong, because I am night owl and don’t like mornings 😉
There’s nothing earth shattering about it, but I learn, and it turns the noodle. I read about the Americans in Vietnam using trees as antennas – my Imperial alumnus account IEEE subs didn’t cover the journal but the Mighty Corvid of Sci-hub did, an I thought what the heck, that was actually a thing? I was intrigued because I read this paper about using a forest to detect neutrinos and thought that’s effing bonkers, these guys are pulling my plonker, but it seems not 😉 The rest of the day I spent extracting brambles out of the hedge and going on a walk with Mrs Ermine. That’s not go-go, but like Kurt Vonnegut and cited by Bogle I know what enough looks like. That seems terribly easy to lose sight of these days. £120k pa and he can’t afford £2k pcm mortgage? WTAF doe he do with the rest, burn it? Ah, the usual trappings
There are special snowflakes, these rugrats, only the best private skool edukayshun will do for the little darlings, though getting divorced from a lawyer prolly doesn’t come at bargain-basement rates. Vonnegut was right, it ain’t what you earn that matters, it’s what you burn…
None of what I do matters in the grand scheme of things or is glory reflected back at me from the world, which I think is an existential need for some folk. Sure, I like eating well, and we go on short holidays quite a few times a year. But I just don’t recognise the “needs” of the go-go people that give such a massive spending heave-ho at the start. The biggest win IMO is getting the monkey of Work off your back. All else is stamp-collecting. You can’t buy Time, whatever you’re offering to pay. I can live within my means in the Micawber sense.
If I end up paying HRT, then I will remember the desperate mustelidtaking off in the darkness of the tail end of the GFC on a wing and a prayer and say to my younger self “you did all right, given a fair tailwind and a hunk of luck”. It will be a sign that I threaded a difficult passage across the pathless land and lifted above the storms by grace, not skill.
But I can appreciate that the HRT symbolism may be different in your case. I never took home earnings above the HRT threshold, other than one year when I ballsed up the calculations on tossing the excess into AVCs/ESIP. So I never lived on that much. And I do take the point that the effective value of the threshold is lower now.
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My day has been pretty mundane, but that is OK.
I read the Freeman story on Monday night and thought much the same.
The quote you pulled out reminds me of a friend who married a divorced lawyer. Whilst the fault seemingly lay fully with the former husband there was apparently no money awarded in the divorce settlement as the former husband was able to demonstrate that there was none; he just so happened to be a chartered accountant!
p.s. first time I have seen ‘stamp collecting’ used in that way
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Hmm giving up 97% off annuity rates because (finger in the air calc assuming 50% taxation) it is only getting £280 p.a. for a capital cost of £450) is definitely not a rational response to that conundrum, assuming normal life expectancy 😉 I think even at class III I’d eat the tax hit 😉
Sorry the last comment may have come across a bit stronger, but note that I started from a deeper hole too. So I have a greater need to show some gratitude to the the combination of Lady Luck and Mr Market. There’s some question about the GIA dropping enough, even accepting the deadweight drag of the gold. I spent a long time being cynical about the magic of compound interest, and I stand by the thrust of that rant as applied to the young, because the young in decent jobs probably experience faster career progression than I did – somewhere there was an FT chart showing this, though I do give that the proportion of decent jobs has dropped compared to my day.
Even I have to give away that like the Hegelian Owl of Minerva, the magic of compounding spreads its wings only at dusk. I may not win the fight against higher rate tax, particularly as my opportunity for course corrections is narrowing all the time as I approach SP. But if it comes to pass, I will have fought a good fight.
I also note that for some peculiar reason if you giftaid donate say £1000 in any one year this lifts the HRT threshold by that much. I did declare one donation one year and observed that, though as it is since I didn’t get to the HR tax threshold it didn’t change anything, and I haven’t bothered since. But given some of the withdrawals of some allowances and edge cases you observed about, it could possibly cost in to do that, anybody hovering on the child benefit threshold for instance. I have never understood why the hell we give child benefit to people who are clearly rich enough to not need such largesse 😉 but it would probably work for that case, and some savings threshold changes similarly.
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@ermine
Excellent point about the Gift Aid. Although I have not brought it up in this discussion, I have previously realised that it gives me some more headroom. I already make not insignificant charitable donations using Gift Aid but, as a BR taxpayer currently, this does not affect my own tax situation. If the HRT threshold looms, my generosity (to charity, not HM Treasury) may increase! Hopefully, HMRC would at least think I am a HR taxpayer and put me on SA before I revealed my donations!
That reminds me of another HMRC trauma. The tax year after I finished work I was mostly living off my voluntary redundancy payoff and my taxable income was insufficient to cover my Gift Aid charity donations. I did not want to rescind all the Gift Aid declarations I had previously made for a situation that would last only a single year. There is a wheeze where you can carry back donations to a previous year. It is mostly used by people whose income in one year is taxed at BR but were HR taxpayers the previous year. I wanted to apply the principle to a BR taxpayer with a reasonably high tax bill one year and a very low tax bill the previous year. Of course, the normal way of declaring this is through SA. The website did mention a form if you are not registered for SA. I requested the form – nothing happened. I requested it again, and they said it no longer existed. I pointed them to the exact webpage and the call agent’s colleague conceded it did exist and it would be sent to me. When I did receive it, it was the same as I had previously occasionally received when working to confirm the amount of my professional (IET & CEng) subscriptions. However, this form contains a large amount blank space for other changes which I duly completed with my Gift Aid carry-back request. This seemed to work and I kept my Gift Aid declarations intact with a clear conscience.
The one postscript to this story is that one year HMRC, as usual, dreamt up a random figure for my savings interest. It did not match the interest paid by any single bank or combination of them in that or earlier years. Strangely it did match the total of my charity donations declared for this earlier low tax year!
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Correction: “I wanted to apply the principle to a BR taxpayer with a reasonably high tax bill one year and a very low tax bill the following year.”
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Absolutely nothing to be sorry about. Your journey is in many ways quite inspiring.
Yes, the reduced SP idea is certainly not rational. In fact, it is just plain daft! And in my case I am now only around one and a half (which is rounded up to two) years short [of a full SP] anyway. And, I do have the paperwork to bring this down to a half (rounded up to one) sitting on my desk awaiting payment. I may hold off on paying the final half (rounded to one) for a bit yet – as the calculus has a factor of roughly two involved – but may in the end just take the ‘bird in the hand’ view too.
Gift aid is worth a look. I think you are correct about how it works, and I should know as I made a small gift aid claim in last years tax return. However, I have forgotten the nitty gritty details as it had no actual impact.
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@Al Cam
I only just noticed that your comment above about the change to RPI calculation from 2030 is at least partly directed to me. My DB pension increase uses the January RPI figure, revealed in February, and is paid from the following May (payment actually made 30 April). It is capped at 5% and the cap has, of course, applied for the last two years. December RPI was 5.2% so in a couple of weeks I’ll know how much I will get. Ideally January RPI will be 5.0% and then rapidly decrease in subsequent months!
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@DavidV,
Yes, you might just gain back a bit this year on your indexation.
I never realised there was so much variability in the detailed implementation of DB indexation by different schemes.
Curiously, I did note fairly recently that the SP triple lock uses different months for the wages and CPI inflation components.
Them details sure do contain some devils!
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Al Cam > Them details sure do contain some devils!
They sure do! I regard myself as a competent individual who is good at maths and finance, but I find my own DB scheme incomprehensible. I think I just have to trust the scheme actuaries.
Anyway, I wanted to say that I have enjoyed the discussion down here and it has prompted me to consider my own CGT problem. Basically when I was much younger I didn’t do the sensible thing of diffusing my gains, so I am sitting on a huge pile of unrealised gains. (Nice problem, I do understand that.)
In particular the reduction of the CGT Allowance to £3,000 in the coming tax year is a pain, which means it will take 4 times longer to get rid of them than if it was still £12,000.
I managed to mash the my CGT problem together with the ‘how much of my SIPP should I draw’ problem and hope you don’t mind me sharing what I think a good solution to both would be.
My original plan was to draw £30,000 (£22,500 taxable and £7,500 tax free) through an UFPLS, as a way of giving me enough to live on in the coming year, which combined with realised profits from a fund sale also allows me to use just under the £3,000 CGT allowance to fund a full ISA subscription without paying any CGT.
My new thinking is to just withdraw £16,800 from my SIPP (£4,200 tax free and £12,600 taxable). This is just over my tax free allowance for income, so fully uses it up.
This then leaves the difference between £12,600 and the higher rate band (£50,270), so that I can realise as many capital gains in that amount and still only pay basic rate tax at 10% on them. (In my case I ‘only’ want to sell six funds valued at approx £60k with roughly £23k CG).
This seems good. I am only paying CGT at 10% instead of 20% on income. It also means my unrealised gains will disappear fast.
The downside is that I will not drain my SIPP of funds before my DB pension kicks in.
My main concern however is paying CGT. I have never had to do that before. I do keep good records and don’t mind claiming it. Even so, I am a bit worried that this claim may stir HMRC into action and they may want a thorough drains-up on my CGT, especially as it will be the first time I will have had to pay it. I don’t really want to face the HMRC/Spanish inquisition.
Does anyone else have any experience of paying CGT? If anyone has any experience (good or bad) or thoughts they could share I would appreciate it.
Is there anything else I am missing here that makes this a bad idea?
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@Jam (I’m glad you’ve got your short name back!)
What you propose sounds potentially like a good plan. I think you first need to ask yourself whether, if you do not empty your SIPP before your DB pension starts, will you then still have sufficient headroom to withdraw from the SIPP at basic rate? Remember that thresholds are currently frozen until 2028 and your DB will most likely be revalued in the meantime, further reducing your headroom. How long is it until you reach state pension age and will the state pension eat up or exceed all the available headroom? Remember this will also be revalued before payment, currently with triple lock, year-on-year.
I have never had to pay CGT. About 27 years ago I had to report fund disposals over the limit, but my gains were still within the allowance (and there was inflation relief then). Inland Revenue (as it then was) sent me a tax return to complete – this was long before self-assessment which I still do not qualify for. I had good records but it was an complex spreadsheet I had to attach to the return as my gains were from a unit trust monthly subscription plan using accumulation funds! Remember that if your disposals are of unit trusts or OEICs, you have to subtract the equalisation from the purchase price when calculating your gain. Neglecting this was a mistake I made a couple of years ago and to offset this gain above the allowance I had to use up part of a capital loss I had registered many years before and kept in reserve.
Note that these days you can report capital gains through self-assessment (if you qualify) but there is also a separate capital gains reporting service that you can register for using Government Gateway.
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@Jam:
I agree with DavidV. The only additional thoughts I had were:
a) this task just screams a spreadsheet – specifically, one designed to allow lots of what-if’s. I suspect that the s.sheet may become quite complex quite quickly as there are a lot of moving parts. WRT moving parts: there are probably more than you might immediately think e.g. a) your DB schemes rules for revaluation (increases before it comes into payment) may not be the same as DB rules for indexation (increases once in payment); and b) the tax rules are rather likely to change. I would try to tackle the s.sheet bit by bit and from the outset accept that it may take quite a while and it will almost certainly never be completely correct either. Making simplifying assumptions will probably be necessary and is generally OK – but be aware of any unintended consequences.
b) some thought will probably be required as to what exactly is the aim/goal you are trying to achieve (I say that because in my case I am trying to eliminate (as far as practicable) the possibility of ever paying tax again at HRT, but, if possible, I definitely do not want to pay any HRT to empty my SIPP – this may seem a bit odd to others but so be it).
c) this process may also help you work out when (or perhaps the earliest date) to start your DB.
FYI, ‘my watch out for HR tax’ spreadsheet started life quite simply but has evolved over time into something a tad more complex and is now highly specific too. If nothing else, a s.sheeting exercise should help drive home the key points of headroom erosion and the sensitivity of this to inflation.
Lastly, to date, I have never had to pay any CGT either.
Have fun!!
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@Jam
One more thought to add to Al Cam’s suggestions: don’t forget to include your unsheltered dividends and savings interest in your calculations. The whole amount, without deduction of the respective tax-free allowances, is added to your other income when determining if a tax rate threshold is exceeded. Although interest and dividends are then regarded as the top slice of income when the allowances are then applied to the tax calculation, exceeding the HRT threshold causes those allowances to halve.
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Thank you both for your thoughtful replies.
I started investing small amounts back in the 90’s before the internet was widely available and before platforms even existed!
Back then I would look up the best unit trusts (now OEICS/‘funds’) in What Investment magazine and you would buy them directly from the fund management group.
I actually still held some funds directly with one fund management group until last year. (It was very cheap: no platform fees(!) – not the sort of thing you would ever see on Monevator’s excellent broker comparison table) They seemed unable to comprehend that a small retail investor would be dealing directly with them. I got the impression they normally only dealt with large platforms and that I really was an extinct breed. In short that made it a royal pain, especially as they spent the best part of a month telling me I didn’t have a direct account with them and that I must hold my funds via a platform, before managing to finally find my fund holdings.
I only transferred them out last year, so a platform could act as a buffer against their incompetence.
I made plenty of mistakes back when starting investing, such as buying accumulation units, which has complicated my calculations for these sales now.
I am assuming that if I bought a fund for say £4,000 and sold it for £10,000 so it looks like a gain of £6,0000. However, if it had had £1,000 of income accumulated within it I would deduct the £1,000 from the £6,000, so gain of only £5,000 in practice.
I had forgotten about equalisation, but have saved details and records for that too.
I have all the contract notes filed away and kept records in a filofax (it was the 90’s) which I transcribed to a spreadsheet that I had been using to calculate these gains.
I had a lot of this type of investment from back then. I was in a DB pension scheme, and pension freedoms were not a thing then, so no maxing out pension contributions. Also ISA’s (and PEP’s their forerunner) had small contribution limit is, so that was how I built up a large taxable holding. It is surprising how even small amounts back then are so large now, but compund interest has worked its magic.
A couple of other funds were transferred to a platform over a decade ago and have been subsequently transferred again, especially when the RDR came in, with changes in platform fees, which I sought to minimise.
As I said, I have kept good records all things considered. Ideally HMRC would just accept I was selling 6 funds for £60K with a £23K capital gains and just charge me the CGT on that.
However, if they wanted a breakdown of this and wanted to see my calculations I could produce them, but it would need an explanation as to why my figures are correct.
I would feel sorry for the poor HMRC clerk who has to wade through this as I would be for myself at having to provide the evidence, if they did want to query it.
When the CGT limit was £12,000 I would have just sold these over 2 years and not needed to declare anything. I am nostalgic for those simpler times.
I suspect the government didn’t allow for people like me, who would possibly pay less tax as a result of reducing the CGT limit, but then most people are not FIRE’d and in the gap before their DB pension kicks in and so can elect to reduce their SIPP withdrawals. I must be a really edge case.
Thanks again for your thoughts and advice, it is very useful. Doing this feels like the right course of action. I still have a couple of months to finally decide though.
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That’s probably the most likely outcome, it’s hard to see it being worth their allocation of resources to pick a fight for that amount.
Because I use Taxcalc to both compute and submit CGT, and it’s online, I do submit the full calculation because that’s a feature of taxcalc. I’ve also designed the GIA to minimise CG complexity – very few holdings, and I try not to build up a holding in bits, and to avoid buying anything within 30 days of a transaction in the same instrument unless there’s an exceptional reason to do that.
I’ve never had any trouble doing that, I think I have used some CG allowance for the last two or three years. But I’ve never paid CGT, the aim being to stay within the allowance.
6k of your sales would be CGT free this year and you could use the 3k for next year if you split this over this year and next. It’s sobering that the remaining 14k CG would take another five years to run out under the limit!
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Hard to disagree and I have been doing SA for over twenty five years now.
@ermine also notes that there may be some mileage in doing things both this tax year (’23/’24) and next (’24/’25) – see also my comments below. There may be perfectly good reasons why this tax year is off the table, but I have thus far failed to twig that. If this tax year is a possibility you may need to get your skates on though, but utilising a 6k CGT allowance plus a £3k CGT allowance vs using a £3k CGT allowance might just be the incentive you need.
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@Jam,
An interesting story. I still have some discrete shares that I keep promising myself I will rationalise; but have just never got around to sorting them out. If nothing else, they have provided interesting lessons in volatility!
I may have misunderstood something, but to my eyes you could still sell some £25k+ more from your SIPP at BR.
The gap from jumping ship to commencing your DB really is a one off income tax opportunity if you think you are in danger of being a HR tax payer in due course. Which is currently far more likely than it used to be.
With the benefit of hindsight, I used my gap fairly well, but perhaps was initially a little timid. I say that as I started off just ensuring I could fill that years ISA at the lowest overall tax rate; which in effect meant that I left quite a lot of the BR band unused. And, it is, of course, use it or lose it! I possibly chose to initially focus on the wrong metric – tax efficiency. I started this process (that for some long forgotten reason I christened shuffling) some seven years ago, long before the current round of fiscal drag, etc was thrust upon us. I actually got hold of the idea from reading about what our US cousins call Roth conversions. And our host (@ermine) did something similar but IIRC he largely flattened his DC/SIPP at 0% income tax by just using the personal allowance. I did end up being much bolder as I got closer to the end of my gap, but that was largely prompted by my realising that as I was likely to bring my DB commencement forward I needed to speed up flattening my erstwhile DC/SIPP. I reckon I should be able to complete this process before my SP starts.
On the other hand, some people just go right up to the BR limit from the start of their gap.
Horses for courses really; but I just can not see such an opportunity ever arising again!
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Apologies, I have just twigged the answer to the £25k. You want to do this in this tax year and have already UFPLS’d out around that amount at the start of the tax year. Dohhhhhhh!
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Thanks again for all your replies. It has given me more good points to think about.
I withdrew enough from my SIPP this tax current year to back in April to meet all this years spending needs. I also realised my capital gains back in April as well, using just fractionally under the current years £6,000 allowance, so didn’t have anything to report CGT-wise when I did my P55 UFPLS tax reclaim.
There is nothing to stop me going back and making another UFPLS withdrawal this tax year, although I had told HMRC that my April withdrawal was all I had planned. I was so close to the CGT £6,000 limit that virtually all of any extra gains I realise before the end of this tax year will be taxed at the 10% CGT rate.
I tend to take the view that it is perhaps better to just leave the current tax year alone and pay the 10% CGT on gains in the coming tax year instead. At least that should get the current year tax file closed off with no problems when I can update them with actuals for my interest and dividends instead of the estimates I gave them.
With regards to my SIPP in previous tax years I had drawn out more than I needed to live on each year. That was fine to help run it down before my DB kicked in, but meant I was just exposing the proceeds to tax including CGT, so seemed like a bad idea all things considered. That’s why I changed it in the current tax year to just withdraw what I expected to spend through the year.
My full state pension and DB pension, plus dividends and interest will still leave about £12k headroom before HRT is a problem. (I can therefore still make withdrawals from my SIPP even then. Although, maybe I will want shot of the admin and may appreciate an index linked annuity, which could be another way of emptying my SIPP.)
Back when I started investing global funds were not available. Vanguard’s VWRL only can into existence back in 2012 for example. So I have a couple of European funds, Japan and EM funds and a US Index fund. I have been slowly selling and them over the last few years, but within the old £12,300 and £6,000 CGT allowance. My UK fund as the highest yield was the first I tackled.
My decision seems to come down to drawing a minimal amount from the SIPP (to just use the income tax allowance) and trying to diffuse the capital gains in as few as years possible. Or to try to empty my SIPP and just live for a long time with the CG’s being very slowly diffused. This later option seems a bit daft, since as emptying my SIPP just exposes more to tax on the funds I move out of my SIPP.
More appealing and especially for the coming tax year, between these extremes there is the option of just drawing a year’s worth of living expenses and that would still allow a fair amount of headroom to perhaps, to test the waters with say a smaller £13K capital gains that I would have if completely got rid of just 3 of the smaller funds. It would also allow me to see how HMRC treat my capital gains. Hopefully you are right @Ermine, that it wouldn’t be worth their allocation of resources to pick a fight for this small amount. But if they did it would only be for 3 funds not my initial plan of 6 so would be a smaller headache if that happened.
So treat next tax year as a trial run while still getting a useful amount of CGT diffusion in.
I could then look minimise my SIPP income and maximise my capital gains in subsequent tax years. Although I would expect a change of government by then, so what the income tax and CGT rates and allowance will be is anyone’s guess. Hopefully ISA’s will still exist!
I am a bit embarrassed that I am sitting on such large capital gains. It will take many years of realising maximum gains with small SIPP withdrawals to fully diffuse them. It is a one of life’s better problem, so do understand my good fortune.
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@Jam
What you propose seems quite sensible. As you mention, not emptying the SIPP as quickly as possible preserves the possibility of taking out an annuity later (although purchased life annuities for non-pension money are available). Although this hasn’t been mentioned so far, if you have a legacy motive, SIPP bequests have also the advantage if you die before age 75.
Just as you were able to provide us with your practical experience of UFPLS, I look forward to hearing in a year’s time your experience of paying CGT as a non-self-assessment taxpayer (although like ermine and Al Cam it is my plan to try and stay within the allowance).
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@Jam,
A good chat.
Sounds sensible to me, and probably far more important: you seem to have a good handle on your situation that you can live with. A lot of this stuff is really not just about the maths!
The available headroom is a key point, and I would suggest that you keep this under review in the coming years. I just happen to view me having to pay any HRT on my SIPP as a bit of a failure. And, if I do not empty my erstwhile DC/SIPP before my SP begins that is now my most likely outcome.
A couple of other things to ponder/note: a) would c. £12k PA actually run down your SIPP – and does that matter anyway; & b) an annuity would provide additional taxable income.
As you say, there are many imponderables and, IMO (no matter how you do it) continuing to fill the ISA each tax year is probably the one action we should all strive to take. As things currently stand, I am not yet sure how I will do this once my DC/SIPP is empty. I do have options, and for now at least, I will worry about that bridge when I come to it.
I too look forward to hearing in due course how you get on with paying CGT.
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@Jam,
Something has been bothering me about your paragraph:
And for some reason it came to me whilst I was walking around the supermarket earlier this morning. To make the above statement you must either already be drawing your DB pension (and thus know what it currently pays you) or have assumed a date/age that you will start to draw your DB pension. So far, so obvious. IIRC you are still to start your DB, which would mean you have made an assumption. When you couple that with your much earlier response to my statement about “them details sure do contain some devils!”, specifically:
I’m left wondering what assumption you made about your DB starting date/age and value and what information you had [perhaps from the scheme actuaries] to help with this. If I was doing that calculation I would ideally want to know, in todays £’s, what my DB pension would be on say my 60th, 61st, 62nd, etc birthdays and the schemes rules for revaluation and indexation. Sorry if this is all clear to you, but, from experience, I know just how easy it is to get this stuff mixed up. Furthermore, the info you get [possibly from “the actuaries”] will almost certainly depend on the rules of the scheme. AFAICT, there is no single set standard way of presenting this type of info. For example, if your scheme uses only fixed revaluation, the values may not be in todays £’s. The easiest way I found to clarify the ‘currency’ used is to ask for the same information (60th birthday, etc, etc) again every year for a few years.
One further possible wrinkle in this area is that I have assumed that any early retirement factors (ERF) and/or late payment factors (LPF) involved do not change from quote to quote. If they do that just makes it more complicated. AFAICT, most DB schemes rarely mess about with their ERF’s &/or LPF’s and if they do they tell you (assuming you know where to look). I recently learned that apparently bulk annuity providers do mess about with these factors far more frequently.
Again, apologies if the above is all already crystal clear to you but I just thought it worth a mention.
As an aside, my DB scheme uses both todays £’s and full revaluation to the date of commencement. Fortunately, the latter only applies to the GMP part of my DB pension – which in my case is a relatively small fraction. This means that year-on-year my ‘quotes’ (60, 61, etc) increased but not by quite as much as the revaluation rules alone would imply. None of this is rocket science, but IMO it is not that obvious either.
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@AlCam I have just never been able to get into the intricacies of my DB pension in the way you have. You probably understand pensions better than most IFA’s and even actuaries!
I have always thought that my pension is valued in today’s money. There are so many parts to it, Post 06/04/88 GMP; Pre 05/04/97 excess over GMP and a couple more sections where the LPI on a part of it was changed from 5% to 2.5%. Just trying to get into the fine detail of it all makes me want to despair.
However, my ad-hoc requests have lead me to believe that it is revalued in line with inflation until payment; when in payment the is RPI indexed limited 5%, or CPI indexed limited to 2.5%, with bits fixed at 3%.
I will follow your advice and get regular updates on withdrawing it at age 65 (NRD) and each year before.
My DB pension is far from my biggest asset, due to being outsourced many years ago when we were moved onto a DC pension. That is a much longer and separate tale to tell!
My gut feeling though is that I will just not take my DB pension until I am 65, the NRD, unless something unforeseen changes.
@DavidV > Although this hasn’t been mentioned so far, if you have a legacy motive, SIPP bequests have also the advantage if you die before age 75.
The sequence of returns I have had since FIRE’ing have been very kind to me, so doubt I will die with zero. I really do need update my will, but plan to leave any assets I don’t spend to charity. I have already updated my expression of wishes with HL’s SIPP to nominate a charity.
@Bill. That’s interesting, thanks. I hadn’t heard of CSH2. I will have a look at that. I had been using short date Gilts to get a better return than cash.
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Joking apart, it took me years to get to my level of understanding of my DB scheme. And even then I am still not confident that I have a good grasp of all the ins and outs of it. And, at almost every turn, there seems to be something new to learn too. Whilst I am sure the intent was never to make these schemes complex, they have evolved over years and the complexity is in part down to that.
Years ago, I spent a bit of time trying to understand the old state pension system, in particular the additional pension (AP) part of it. From memory, that is pretty complex too. Somewhere I have a many sided letter (>10 sides, I think) from HMG that “explains” what was then <£5 worth of AP!!
>There are so many parts to it…
AFAICT that is par for the course. Despair is not an unusual reaction either. I will admit that I got pretty cross at times too!
>My DB pension is far from my biggest asset, due to being outsourced many years ago when we were moved onto a DC pension.
OK, got it. In my case it is amongst my biggest assets – hence my interest in the details.
Was it the just the admin, etc that was outsourced, or has your DB been replaced by a bulk purchase annuity (BPA) from an insurer?
>when in payment the is RPI indexed limited 5%, or CPI indexed limited to 2.5%, with bits fixed at 3%.
It may not yet have occurred to you but this means that if/when inflation is low (say CPI <2.5%) you will get above inflation pay rises, due to [partial] use of RPI (until 2030 or 2031- as explained above) and the fixed indexation part too.
>My gut feeling though is that I will just not take my DB pension until I am 65, the NRD, unless something unforeseen changes.
Fair enough. I took mine a few years earlier than that for several reasons as explained/discussed previously elsewhere on @ermines blog.
>I will follow your advice and get regular updates on withdrawing it at age 65 (NRD) and each year before.
In time, you might be surprised what info you can glean about your DB scheme from adopting this pretty simple protocol.
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As mentioned above, a quick update on this years flexible drawdown withdrawal (not from HL). According to the PAYE element of my personal tax account (PTA), my latest flexible drawdown cash will be paid into my bank account this coming Monday (5/2/24). This will be 28 days after I initiated the withdrawal. So, not the fastest nor indeed the slowest. I did, however, chase it up by phone at the start of this week, which really should not be necessary, but so be it. The good news is that – for the first time ever – I have paid the correct amount of income tax. So I will not need to claim back any over-payment.
And, as also mentioned above, whilst HMRC’s PTA system has the payroll information my erstwhile DC/SIPP providers online system does not yet provide this information; it just acknowledges a gross ad-hoc withdrawal is in progress.
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And to complete this years experience of my annual flexible drawdown withdrawal (not from HL).
As of 10:00 this morning my erstwhile DC/SIPP providers online system had been updated with the payroll data (available via HMRC personal tax account since late on Friday 2/2/24). The providers system also stated that the payment, due today, would be made via CHAPS (so same day payment possible) rather than BACS (which seem to usually mean a three working days delay). Both CHAPS and BACS have been used for previous payments. I suspect that BACS may be the default (as I understand it is cheaper) but because I chased up the withdrawal again this year it was paid using CHAPS. I say this because during my call I was assured that the payroll parts had been escalated and would be executed as quickly as possible.
The correct net withdrawal (hurrahh!!) money arrived in my bank account sometime between midday and 15:30 today.
Over the weekend I also updated my ‘watch out for HR tax’ calculations to use the latest BoE inflation forecast, released 1 February 2024. Whilst this does imply a small pound notes impact, it made no substantial change. That is, when my state pension (SP) hopefully commences in a handful of years I will most likely breach the HR threshold, unless something significant changes between now and then.
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I do like Avebury. Have you visited the megaliths in Brittany? Marvels, and just a short hop across La Manche from you.
I’d very much like to see Neolithic Orkney but travelling is difficult for me. My daughter urges me to use a private jet, as exemplified by such great environmentalists as Prince Harry.
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Carnac has been a regular haunt, and a while ago I toured Brittany. My younger self and some pals on one of those trips made the epic fail of expecting to get digs on the 14th July, we ended up all in a Cortina parked in front of the Dol de Bretagne, which was atmospheric if not comfortable 😉
Orkney is excellent, the Ring of Brodgar and the Stones of Stenness are easy to get to from the road, and Skara Brae similarly, though the site itself has a bit of uneven up and down. Some of the other sites involved a hike and a duck to crawl through low entrances, but the first three are well worth the trip on their own!
Private jet eh, I’d say a helicopter might have the edge, I watched a programme about Orkney with some fellow on Alba satellite who was trying to make out it was the capital of ancient Britain, I’m sure there was a chopper involved there. The Pentland ferry wasn’t so bad, but you do have to get right oop north to get on it. Looks like you can fly from Aberdeen, Edinburgh, Glasgow or even Manchester to Kirkwall which could be an easier win, none of those sites are that far from Kirkwall so a taxi ought to do it. We were in the campervan, so the ferry had the edge! You may as well follow Harry’s lead!
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That was a mammoth post with so much content almost worthy of becoming a maven on your blog hehe. My comment seems tiny in comparison so apologies for that one :D…
I found it particular interesting reading about your musings on social media. I have pretty much grew up mostly with the internet there but I still have the benefit of living without it for the first 12-13 years of my life. I grew up on the NES and Sega mega drive instead and there was no social media whilst I was at high school other than MSN messenger. I myself don’t use Facebook to post anything but I am on there, I love YouTube and Reddit but post and view them both anonymously really without posting too much to be fair. The communication channel I use the most is WhatsApp. I think social media can be a curse and a wonder in equal measure.
TFJ
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I think that’s the trick with social media – read/consume but don’t post. I went tthough FB and canned all the friends who weren’t friends and a I got my small mustelids back, and some crew claiming there were pine martens in Devon which I just plain don’t believe 😉
If you don’t say ‘owt or like etc owt the algo has less to work on. But it’s still an uneasy truce.
BTW your site https://thefijourney.co.uk/ made Firefox spit effing bricks – a self signed certificate and two ‘you really don’t want to accept the risk and continue’ intersititals. You may be losing readership that way… No crit, JFI
People have said I go on too much It’s a fair cop 😉
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Today’s news on the latest retirement livings standard survey by the Pension and Lifetime Savings Association had me thinking about higher rate tax and fiscal drag again. A gross income at the higher rate tax threshold of £50,270 implies a net income of £42,730 for a person who has the personal allowance and no other complicating factors.
The latest figures in the survey claim that a single retiree needs £14,000, £31,300 and £43,100 for its Minimum, Moderate and Comfortable lifestyles respectively. The equivalent figures for a couple are £22,400, £43,100 and £59,000 respectively.
This implies that a single retiree (like me) potentially needs to be a higher rate taxpayer to have a comfortable lifestyle. I know in practice there are mitigating factors such as part of pension income may be available as tax-free cash and income from savings and dividends have their own (shrinking) allowances. I also personally think these figures are very over-stated. I believe I have a moderate to comfortable lifestyle on very much less expenditure than this.
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@DavidV,
I agree that the (post tax) PLSA expenditure levels still seem high. To my eyes, these values have been high since they were first introduced and I am not sure what is the real aim(s) of the group behind these figures.
Having said that, needing to be a HR tax payer to enjoy a comfortable lifestyle is oddly aligned with the observation that unless things change by April ’28 (at the latest, using just the Feb ’24 BoE inflation forecast and assuming no more above CPI wage growth) any singleton surviving on only the full new state pension will be a BR tax payer. However, it is not at all clear to me how HMRC would collect their income tax!
The tax collection conundrum alone – which I guess could impact millions of people – could be just the trigger for some unfreezing of the tax bands.
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@Al Cam
I’ve been looking on the website to try to find out who constitutes and fund the PLSA. A July 2018 document says they have 90-year history and their membership includes more than 1300 pension schemes with 400 supporting businesses. The supporters page on the website includes major pension schemes, insurers and consultants. Clearly they all have an interest in maximising pension saving and any research that illustrates the need for retirement income far in excess of the state pension is in their interests. An element of independence is maintained by having a university (University of Loughborough) conduct the research but, of course, one always has to be mindful of the funding behind any research.
I think we can be reasonably confident that as soon as the full amount of the new state pension breaches the existing personal allowance, then the allowance will be raised to at least match it (any small amount of savings interest over the personal savings allowance would probably be covered by the starting rate for savings allowance). If the government did not do this, there would not only be a huge admin burden for HMRC but also a political backlash. Imagine the press reports of HMRC pursuing debts of a few hundred pounds through the courts of poor pensioners with only their state pension to live on! If the consequent reduction of tax take from the working population is too much for HM Treasury to swallow perhaps they could instead introduce an older persons allowance for those over state pension age (I believe there used to be one even as recently as my father’s retirement). If they’re feeling really mean, they could even taper this allowance for those of us with other income.
Whatever happens, don’t rely on the HRT threshold increasing to complement any changes at the bottom end of the BR tax range!
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Simplisitically, the mustelid mind thinks surely your ISA should be your friend here? I have to admit that I struggle to imagine spending 43k on my own, though accepting that some things are dearer for single households. Do these figures assume a paid off house; if not I could see were the difference ends up?
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@ermine
Yes, I’m fairly certain the report assumes a paid-off house. I fully accept that there are many ways, including drawing down from an ISA, that enable a £43k net income without having a £50k+ taxable gross income. I was taking a simplistic view here, especially as the PLSA seems to mainly represent the pensions industry. I think it is generally assumed that it is not FIRE types being considered here, but people who retire at normal age and receive most of their retirement income as pensions.
Incidentally, a spokeswoman for the PLSA was on BBC R4’s PM programme this afternoon. She highlighted that the retirees interviewed for the report themselves propose what they want to be able to spend money on. She also said that, at the Moderate and Comfortable levels, that includes being able to help adult children financially.
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> at the Moderate and Comfortable levels, that includes being able to help adult children financially.
aha, here be a bottomless bucket, because this is what secular decline looks like. People’s children won’t have more than they did, in general. Look at the two bellwethers for establishing a bourgeois adult life, being able to buy a house and pay it off before retirement, and being able to raise 2 rugrats in said house, usually while mortgaged. In general this was easier in the parents’ day than nowadays.
So there is much deadweight loading that the unencumbered can probably eschew, and spend on sweets, crisps and self-improvement instead 😉
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@ermine
I thought that would trigger a reaction! I seem to remember that grandchildren got a mention too. Another ever-increasing drain on not only the wealth, but also the time, of many retirees these days.
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Actually from AlCam’s link below the PLSA help to children and grandchildren is quite modest and in keeping. £1000 as cash and £1200 in gifts. I was more thinking in terms of tens of thousands to get them a deposit on a house, or loadsamoney for the Veblen good also known as private skooling. H/T GFF for introducing me to this blessed couple who are paying 2/3 of their take-home income in the £42,000 p.a. to give their darlings the bracing experience of being the poorest in the school 😉 There’ll be a job for some therapists 10 years down the line
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See: Home – PLSA – Retirement Living Standards
>and spend on sweets, crisps and self-improvement instead
I always thought sweet, crisps (along with beer, wine, lobster, etc) was self-improvement, dohhh!!
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Interesting contrasting their spending targets. We have far more than 4 short breaks, and these are usually midweek not long weekends. Curious the fortnight holiday in the Med, sounds to me very much like a worker bee dream, peer group couples with grandkids and those without seem more on the several city breaks pattern, most of this peer group run two cars.
> Extensive bundled broadband and TV subscription.
streaming sees to be a big thing 😉
Like all budgeting it seems that the drip drip of the little things add up, the streaming and the gifts don’t sound much and I’m still struggling to pick up exactly how these retirees need 60k but I presume the PLSA can add up right
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At the rate of increase the PLSA are using, see: Pension income needed to retire jumps as family costs rise – BBC News (for quantification of more than a 34% year-on-year increase ie £8k increase on £23.3k last year) I really must questions what this lot are up to! Sounds like they might have been listening to far too many junior doctors and/or train drivers if you ask me.
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Aha, from that BBC article it appears I suffered an epic comprehension fail on the PLSA original.
obvs £1000 per month on the grandchildren’s activities is quite a higher level of expenditure, if the frequency matches the eating out part
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@ermine & @Al Cam
I couldn’t believe £1000/month as likely so I’ve had a quick look at the full report here . I think it is part of the ‘helping others’ category and is actually per year. I haven’t settled down to read the full report carefully yet. I agree that streaming subscriptions seem to feature strongly – maybe I should recategorise my ‘moderate to comfortable’ existence as frugal.
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OK, so that was right first time on the kids. I don’t find that excessive. Indeed, even as someone without kids and grandkids my helping people out is rather more that these folk spend on their family, because: Be no King Tut, though I heartily approve of the principle of these good folk doingthis while they are alive rather than the IHT gripers. Good for them.
I am probably in the frugal end because all that streaming and mobile phone subscriptions is costs I just don’t have, I PAYG when on holiday, it’s nowhere near that much. But we go away more than these guys do by the looks of it.
As for the comfortable folk drinking tinnies of beer and £8 wine, egads do these people have no standards, I am right now drinking even non-alcoholic beer in bottles because I am precious like that 😉
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@DavidV,
Thanks for the link.
I have skimmed the paper. And I reached a very different conclusion, specifically: at least 135 people in the UK have totally unrealistic expectations!
Nothing new in my conclusion. And I would be tempted to go as far as to say IMO the report is literally not worth the paper it is written on. At best, it perhaps somehow serves the purposes of the sponsors/authors.
To actually publish a paper that concludes that to have a moderate retirement requires a higher [gross] income than the UK median gross salary says it all. Noting that working folks are somehow supposed to be able to save for their retirement whilst working too!
Mind you, the paper seems to stem from the same crowd that go on about eradicating poverty but at the same time choose to define poverty in a relative manner – thus making it [numerically] impossible to ever be eradicated.
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@Al Cam
Au contraire! The paper is full of value ;-). As you say it serves the purpose of its sponsors; it has given us something to chew over here and marvel at the somewhat unbelievable expectations of some of its interviewees; it has provided plenty of material for the BBC and other news outlets; and, finally, it has now provided inspiration for the latest Monevator article by The Accumulator!
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I’ve just noticed the Monevator article is an update on one inspired by a previous year’s report.
@ermine
I totally agree with your comment there on funeral plans. I have always regarded these as ridiculous products. I’m not even sure they would necessarily cover all the expenses as some, such as cremation fees, are outside the control of the funeral directors.
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Yeah, it’s absolutely barmy, it reminds me of the days as a kid where people would do that. Which was fair enough at the time, because in these relatively stable working class backgrounds people didn’t have two brass farthings to rub together, it’s of the same sort of vintage as people filling in the football pools and paying a shilling to the Man from the Pru and renting a TV. It delivers needless lock-in, introduces counterparty risk and inflexibility. And it doesn’t pay interest, unlike a savings account 😉
I believe the funeral is also outwith the estate for IHT purposes, I’m surprised the Torygraph hasn’t proposed this as a solution to the IHT problem – have a funeral and a heady wake where there’s a meal and favours (sort of like wedding favours) of I don’t know, 100 sovereigns, will give the wake some weightlifting practice at 8kg each and can take the edge off the IHT bill…
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@DavidV
Touche!
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@Ermine – do you are anyone else here know what’s happened to the DIY Investor blog? The site now says it is open to invited readers only. I’m not sure if this is a glitch. Anyway, I hope DIY Investor is Ok. It is linked from your blog here which is how I remember the web link!
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I don’t know what’s up there; I’ll be sorry to see him go, let’s hope it’s a glitch!
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