Investment & Investing

I can offer you every sympathy. Crazy that there is such a high interest rates on these loans, and that people under a certain age have just got clobbered.

If I were you I wouldn't pay it off quickly, unless you had money lying around that you didn't know what to do with. There is always a chance that something happens - either to the loan or to you. It's pretty much accepted that the majority of these loans will not get paid off. If the last election had gone the other way they may well have been written off. That could happen in the future, especially as a larger proportion of the population end up paying them = more votes in it, year by year. Also your priorities / career direction / health might change in ways you can't forsee.

Not expert advice, just my two pence worth.

Move to a foreign country?

I've never thought about paying off any extra from what I save/invest each month as the ~4-5% interest is less than I can get from investments on average in stuff like vanguard

This is already a pretty brave strategy - borrowing at 4-5% to buy risk assets that yield 7-8% through the cycle over the long term doesn't leave much margin for error. I guess it's OK if you are doing it tax-free in your ISA.

If you are pretty sure that you are going to be a higher earner I would just get it paid off ASAP, even if you have to clear out your Vanguard account to do it. Famous last words, but the likelihood that it gets written off strikes me as circa zero (particularly for higher earners such as yourself).

^ I agree. I currently invest rather than overpay my mortgage, as I'm more likely than not going to beat the 1.7% mortgage interest in the stock market. But if my loan was 5% interest, I'd be trying to pay it down quick as I could!

YMMV, personal risk tolerance, etc

I don't understand I'm afraid - why is duration (assuming you mean bond duration?) relevant, if the fixed / floating schedules are (again with the assumption) close enough.

I don't really get why equity risk premium is relevant either, given this is all cash / interest rate.

Then again, I've not looked at price / risk factors in that level of detail for a verrry long time.

You've probably seen this, but was helpful for me trying to understand it:

https://www.moneysavingexpert.com/students/student-loans-repay/

I don't understand I'm afraid - why is duration (assuming you mean bond duration?) relevant, if the fixed / floating schedules are (again with the assumption) close enough.

Yeah, bond duration. Most of the UK inflation linkers are very long-duration instruments. They have all performed poorly in the last 3-6 months despite rising inflation because the impact of the long end of the forward curve rising has outweighed the near-term benefit from higher inflation.

I don't really get why equity risk premium is relevant either, given this is all cash / interest rate.

It's an opportunity cost point. You could buy equities instead of these instruments and capture the equity risk premium. You are sacrificing that risk premium to get a pretty ineffective hedge.

Got you.

I tend to look at things from like this at a non-portfolio level, and seldom cross-asset (probably as most of my experience has been within specific asset classes.

I also like the that with an inflation-linked hedge, you reduce the number of unknowns (no doubt paying through the nose for it though), much in the same way that you might choose a fixed rate mortgage over a floating rate.

I tend to look at things from like this at a non-portfolio level, and seldom cross-asset (probably as most of my experience has been within specific asset classes.

I know the feeling- the "personal finance" investment decision is very different to doing this institutionally with other people's money.

I tend to think that retail investors (myself included) need a really good reason to do anything more than pay off expensive debt, buy equity tracker funds and try not to check their portfolio balance too often. That reason is usually tax.

Thanks for all the advice. I'll have a proper read after work.

I do think generally a graduate's spare cash is better off in ISA, general investment (despite CGT) or in your house/home improvements given primary residence relief

Really unfair. Not to get political but I don't get how I know people under 30 with student loans who vote Tory. Also people like my grandparents and friends parents voting to shaft their kids income for life. Crazy

I chat to middle aged people who went for free, got a grant and then got benefits over summer holidays.

2023 starters will repay 9% of their over 25k (lower than mine which is already shit) for 40 years (longer than mine which is already shit)

What would be great is if I could get my employer to pay it off and me forego my salary for a year lol.
Additional contributions come out your net salary they really are bastards

Same here - minimise all debt (including mortgage, where possible, although that's weighed against the unpriceable "utility"), ISAs and then pension, with the cheapest trackers*.

I only know one person (an ex-colleague that I was vaguely friendly with, and still occasionally message) that justifiably does "investing". But 1) he has the legitimate experience and expertise to know what to buy, but more importantly, 2) he's got a ton of disposable wealth. Because 1) is still a dice roll at the best of times, unless you have inside knowledge, can move that market, or are part of a shady pool.

* I remember when I found out that my employer pension cost > 1.5% per year. Some cunt was obviously being paid nicely for that bit of backhanded fuckery.

I know a guy at work who every quarter takes his pension out of the work linked platform and puts it in vanguard pension to save on the fee

I tend to think that retail investors (myself included) need a really good reason to do anything more than pay off expensive debt, buy equity tracker funds and try not to check their portfolio balance too often. That reason is usually tax.

Taking bets can be fun I guess, especially if you are betting on companies you know a lot about in markets you understand - but yeah you probably are not going to get rich from doing your own trading. Someone else is, though :)

This thread seems kinda quiet… 👀

Fubo.tv ceo sells 50k of stock for 1.7m in nov 2021 - today he bought 50k of stock for 136k lol

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Ouch…hope nobody listened to me 🫤

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there's a thread for BTC chat

Been a pretty savage few weeks for me in my S&S self managed fund - main culprits ITM power, Pinterest, Fastly, Snap, Snowflake, Shopify, Bigcommerce and Lemonade (basically big tech and renewables)

Didn't pick any of them at peak and have faith that they're all pretty solid long term. For the last month to max out ISA I dumped everything into Alphabet, Facebook and Apple

This is picture hasn’t gotten much better

I think now is a good time to buy if you have money.

Won't matter if you buy this side or the otherside of the market dip.

Depends if you think Ukraine will resolve itself or whether it drags on and on.

There's a reason why share prices are down. I'm just putting something together on the UK economic outlook for work, and it is horrible. Inflation from energy prices and supply chain disruption in China. Tax increases / allowances not raised. Prices going up a lot faster than wages and benefits -> Biggest squeeze on household incomes for a couple of generations. And interest rates going up.
All that is not making me want to buy anything in the UK.
Maybe sell off on US techs is overdone - I don't know the story there.

I forgot about Ukraine with all the other bad news.
Unfortunately it will drag on and on for years.

Things are usually better than you think, so I still hope that it will get resolved in the short / medium in a way that allows some saving of face on both sides. Properly ghastly situation though.

The rest....well, maybe it's a bit less bleak than everyone thinks, except maybe in the UK where we seem to be in a bit of a tizzy from which there isn't an obvious exit.

What's the forum approved stocks and shares ISA platform? Access to funds as well as individual stocks would be good.

Seems like it might be vanguard?