I mean in these recessionry times
A detailed, yet succinct and thought provoking response!
While I would genuinely believe that following Buffett into Equities at this stage would be an excellent idea - unless of course we the capitalist system is kaput and then we have greater problems then simply pensions; unfortunately, I think a serious question mark hangs over the validity of handing money over to Irish managed funds with opaque charging structures that generally deliver very poor performance. The rubicon figures for Irish managed funds in Thursdays' Times were apalling indictment of their ability imo - they delivered negative returns when adjusted for inflation over the last 5/10 years. While brokers will no doubt post about this terrible bear market; I think the 'value added' of the knowledge which you apparently buy with these funds has a negative value; they can't predict bubbles and adopt random, self interested investment strategies - you might as well buy some ETFs and pay contribution to financial funds industry. The tax break is simply a support incentive for this industry.
My whole concern about pensions is all the factors I frankly know little about. I undersatdn the tax breaks etc and that it is a long term investment.
Where I have a problem is trusting any bank to do the right thing with my money seen as they have been shown to be managed very badly.
Also lets say I started my pension today for say 30 years (2008 to 2038) and everything was going well - the plan was making money and then in the 30th year (2038 when my plan was due mature) we had another recession could the value/ gains be completly wiped?
Like are those people whos pensions were to mature in 2008 - 2009 all after taking huge cuts in the profits from their pensions in comparison to say 2005 early 2006 when the economy was still holding up.
Where I have a problem is trusting any bank to do the right thing with my money seen as they have been shown to be managed very badly.
Have a look at mula's answer for a lesson in communicating a simple idea
The fund is worth considerably less (13k) than the amount I have paid in over the past 8 years. I think I would be better overpaying my mortgage by the the amount I currently put into the pension.
Of course , way better off paying off your mortgage first .
No-one here is asking what age (Sharky ) is ?
Certainly depending on your age .......their will be two priorities ........Mortgage and pension....
Remember retirement age will probably be at least 70 sometime in the future........so how long will you live after 70 ?
If you have a while (e.g. several years to a few decades) to go to retirement then who knows what the medical card qualification criteria might be then?Your pension will of course take you over the threashold for claiming a medical card, so all expenses, Hospital, drugs, dental etc you will be paying until you are 70yrs. I do not have figures but make it a decent size pension or it is not worth it.
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