What do we do in such a dilemma

redman
Posts: 256
Joined: Sun May 28, 2006 10:39 am

What do we do in such a dilemma

Post by redman »

In July 2007 we put on the advice of a financial advisor £160,000 into a plan

to give us an income of £1,800 every 3 months, but since that date we have seen the capital reduced to 109,000 we are down £50,000 what do we do?

we got this money from a house sale after the wifes mum died.

Now do we cut our losses and draw out £100,000 and put it in a investment which is not subject to the stock market or stay with it ?

what we do not want is for the downturn to start eating away at the £100,000

which it only seems inevitable that soon it will..........:-5
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Bez
Posts: 8942
Joined: Mon Aug 01, 2005 5:37 am

What do we do in such a dilemma

Post by Bez »

That's a HUGE loss. I'm no expert and my meagre savings are in a 'bog standard' savings account which isn't making much interest but I feel is fairly safe.



Maybe it's best to play safe while the economy is a bit perilous.



What does the financial advisor say now ?
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gmc
Posts: 13566
Joined: Sun Aug 29, 2004 9:44 am

What do we do in such a dilemma

Post by gmc »

redman;1138870 wrote: In July 2007 we put on the advice of a financial advisor £160,000 into a plan

to give us an income of £1,800 every 3 months, but since that date we have seen the capital reduced to 109,000 we are down £50,000 what do we do?

we got this money from a house sale after the wifes mum died.

Now do we cut our losses and draw out £100,000 and put it in a investment which is not subject to the stock market or stay with it ?

what we do not want is for the downturn to start eating away at the £100,000

which it only seems inevitable that soon it will..........:-5


Get hold of your financial adviser and ask him what he is going to do about it.

What type investment funds did he put you money in to? did he go through the process of asking what your attitude to risk was and more importantly take time to make sure you were aware that the investment could go down as well as up? (Or plummet as well as go down). Did he explain the investment would have to grow at 5% just to stand still?-looks like the income is based on 5% and he probably put you in an investment bond of some kind. Did he explain the tax implications. You can stop taking the income or reduce it if you don't actually need it. If you want to take that level of income you do need an investment that has the potential to grow at more than that so there has to be an element of risk but you should understand the way these things work and any good adviser would take the time to make sure you do. Did he discuss national savings as an option or why you actually need that level of income?

If he was an Independent financial adviser you have recourse if you feel you were badly advised. Was he tied to one of he banks and if he was did you understand that the advice was restricted to only their products. If it was a bank adviser you have a fight on your hands as they are very good at dodging responsibility and many people give up rather than pursue complaints.
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Bryn Mawr
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Joined: Mon Feb 27, 2006 4:54 pm

What do we do in such a dilemma

Post by Bryn Mawr »

redman;1138870 wrote: In July 2007 we put on the advice of a financial advisor £160,000 into a plan

to give us an income of £1,800 every 3 months, but since that date we have seen the capital reduced to 109,000 we are down £50,000 what do we do?

we got this money from a house sale after the wifes mum died.

Now do we cut our losses and draw out £100,000 and put it in a investment which is not subject to the stock market or stay with it ?

what we do not want is for the downturn to start eating away at the £100,000

which it only seems inevitable that soon it will..........:-5


Do you need any of the money right now or can you outwait the downturn?

The usual advice is that the loss is only real when you pull the money out.

What I cannot say is whether these are *usual* times.

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