Shock after meeting my financial adviser…I have to work until I drop dead, no chance for retirement or even slowing down; thanks to George Osborne and Danny Alexander. While I should be winding down my activities, due to health reasons and age Unlike most people in my age and younger, employed in public sector or in the civil service have the option for early retirement on a comfortable pension, I have no option but to carry on working as self-employed, author, commentator, writer and journalist with no retirement option.
For many years ( since I became a senior experienced journalist, I get paid quite high rate per column inch, or per broadcast minute and still cheaper for publishers or media to engage me on freelance bases rather than full employment.) Then when some serious health issues ( and injuries) prompted my doctor to raise the question of retirement or at least part retirement and winding down the mad hours I put in ( a Westminster lobby hack spends long hours in parliament, as well as live TV and radio commentary and writing two books– you can’t say now to a commission when you are self employed ). I explained to the doctor that retirement is a zero option.
In addition to substantial debts, I have no employer pension nor a private pension; instead, I invested heavily in property ( real estate) and worked extremely hard and long hours to subsidies loss-making property when the rent ( prior to 2010) did not cover the mortgage payment and continuous repair costs on the let out property that I accumulated instead of pension.
But thanks to George Osborne lunatic policy of blanket capital gains tax penalising people like me who prepared for their retirement in personal investment, I became a ‘professional’ landlord by default or fluke not by design and will remain so until the undertaker transfers my body to the church and the property burden to my children so they start their own battle with HMRC.
The idea in the late 1980s black Monday when I realised that 10 years of paying hefty £333 a month for pension came to nothing since shares, unit trusts etc ( the bundles financial advisers take most of our hard earned cash to invest in pension), it was less than one fifth of what was projected as growth by the adviser. I took out what is left, and borrowed from the bank manager a sum to be repaid at the rate of £333 ( the amount of pension contribution) over 10 years. I used both sums, as well as another sum from re-mortgaging my home as deposit on several buy-to-let property. I accepted losses as my own contribution pension contribution.
The plan was simple, and made sense ( but didn’t take into account the nastiness of HMRC, formerly Inland revenue in penalising people who took the initiative to create their own pension pot). It was to sell two property to pay off my home mortgage and substantially reduce the capital borrowed on one let out house, enabling the switch from interest only to repayment ( capital plus interest) leaving a modest income from rent to retire on.
Alas, capital gains tax means nothing will be left from the sale to pay off my home mortgage, let alone the house I thought would generate my ‘ pension’. Not only you pay the 28% capital gains tax, but also the ‘income’ from the sale added to your income in that tax-year so suddenly you pay, 40%,50%, or more income tax….
so much for the conservative idea of encouraging individual self employed to be self reliant and prepare for his/her retirement….no chance of retirement