Legal & General Share Discussion Threads

[pierre oreilly] 15/1/2024 21:32

I was disappointed with the video, which only said if you keep rising a number by 5% each year, you end up with a bigger number if you start with a bigger number. It hardly discussed any of the differences between a pension and an isa as far as I could see. Ignoring the tax difference which we all know about, here are the others I considered.

One main difference is the charges taken out of the returns in a pension. Which is 50%, i.e the chargers about equal your pot value when you retire (of course, most charges are hidden). Hence (partly) the profitability of lgen et al and my investments in them. So in terms of the maths in the video, just halve the value of the pension calculated.

I was expecting discussion on things like liquidity - you can get your cash back in a few minutes in an isa from day 1, with a pension you really never got any (substantive) cash back, apart from your monthly cheque (so say half a mill in your pot, you only got say 2k per month back, taxed). And that only after a few decades. I think it's different now though.

Another factor was passing the pot to your kids when you die. The full value of the ISA went to them, yet the pot just disappears completely in a pension (in the times when you could only buy an annuity, again different today).

Another point, retirement age. Retire when you want with an ISA and take as much as you want tax free. With a pension, it used to be the case that the earliest you could retire was 60 (iirc). Things are also more complex with pensions - isas don't involve tax returns etc, and decisions today (judging by discussions on pensions on here) there are decisions about when to take cash out of a pension to avoid excess tax, whether to carry on working after 65 (!) and so many other decisions necessary to try to maximise the return.

Things are different today, but the main things are still there I bet, tax, liquidity, charges, retirement age

[zac0_4] 15/1/2024 20:53

I agree that having both is beneficial. The maths point to a pension being favourable in a lot more cases than a lot of people seem to think.

[stevetmade1] 15/1/2024 11:59

https://simplywall.st/stocks/gb/insurance/lse-lgen/legal-general-group-shares/news/legal-general-group-plcs-lonlgen-one-year-returns-climbed-af

[pierre oreilly] 12/1/2024 12:01

Zac, it may or may not be straightforward today, I have no idea. But when peps first came out, I had no doubt whatsoever that for me, peps were the way to go rather than pensions as they existed then. There was a multitude of advantages I saw which, to my mind, massively outweighed the initial tax relief for me (as a high rate taxpayer). I haven't watched the video yet.

[williamcooper104] 12/1/2024 11:59

Going to shift a few at closer to £3

[zac0_4] 12/1/2024 11:52

lippy4 - it's not as straightforward as you suggest. Take a look at "Pete Matthew ISA vs Pension" on youtube

[rongetsrich] 12/1/2024 10:53

First question I have is on preference shares versus bonds/ gilts. My planning assumption is a Labor government, so I'm looking at fixed income or foreign shares, poss S&P or May German shares. Germany because they are now sick but will, or have to, improve. So whatever toxins Labour inject into our markets they can't really screw German or US companies; they can screw ISA and pension functions, but they screw themselves too. Generally an MP is on around £100k with allowances so no different to the majority.

[rongetsrich] 12/1/2024 10:48

Guys, shall we use the unused LGEN thread for pension planning et al?

[lippy4] 12/1/2024 10:34

i remember years ago talking to my financial adviser about pensions and he did not have one he put all his money into peps and isas,the tax relef when going in is great but paying no tax on income when you retire from isas is far better as the government keep squeezing more tax out of you....

plus share dealing gains are tax free..

[mcunliffe1] 12/1/2024 10:33

Sensible CWA1. thanks.

[cwa1] 12/1/2024 10:10

MC, I've no problem with a SLIGHT diversion from totally on-topic stuff as long as it is at least loosely related(pensions, brokers, similar cos., etc) and doesn't wander TOO far off the beten track(COVID, Brexit, Politics, etc) and for TOO long ;-)

[mcunliffe1] 12/1/2024 09:42

CWA1: I appreciate you created this thread to discuss LGEN and there are many other threads that deal with other companies. However, there's a common 'thread' running through LGEN PHNX MNG Aviva and ABDN and it's investment for retirement. Pension income for want of a better term.

The slightly off-topic issues that are commented upon here and the other threads are exactly what makes this site and this thread in particular so useful and interesting.

That aspect of age 75 - tax or no tax etc. was a classic. It appears (thanks Ron) that there is indeed a cut-off point at age 75 with regard to tax liability for inheritors. This is critically important stuff and may come as news to some of the posters/readers of this thread.

So I'm very grateful it's been discussed, thank you all.

[tornado12] 12/1/2024 08:45

UK CPI DEC figures are released on 17th January.. watch this space

[tornado12] 12/1/2024 08:36

The share price manipulation on the FTSE is quite breathtaking today. The rise and fall yesterday as US missing slightly the CPI for last month and the markets immediate panic !! I said before the share price should be in range 250-260 before the FY results and then expect further correction upwards. Does not help my divi investment margins but this is where LGEN should be based on fcst results and EPS growth.. looking really fwd to the results and how the new CEO delivers them with future guidance.. GLA

[cwa1] 12/1/2024 07:59

Annnnnnd back to LGEN :-)

Tipped as a HOLD in The Telegraph's Questor column this morning:-



Entitled:-Don’t overlook this company’s growth potential while it trades at a bargain
Questor share tip: Legal & General’s low share price is difficult to justify given its long-term prospects

Snippet:-

Of course, the company’s change in chief executive at the start of this year represents a substantial risk to investors. As this column has previously highlighted, the preceding chief executive had an excellent track record of delivering strong financial performance and high shareholder returns.
However, the stock’s ultra-low valuation means that it offers a wide margin of safety that more than adequately compensates investors for such “known unknowns”.

Since being added to our income portfolio just over seven years ago, Legal & General’s share price is practically unchanged. While this is undoubtedly disappointing, our notional holding has generated an income return of around 49pc.

Therefore, it has achieved its primary goal of providing a generous and reliable income over a multi-year time period.

For some income-seeking investors, a repeat of this performance in future years will be viewed as sufficient. After all, their main aim is to obtain a high and growing income that allows them to at least maintain their present spending habits over the long run.

However, due to its unjustifiably low valuation, Legal & General also offers significant capital growth potential.

Alongside a variety of other dirt-cheap FTSE 100 stocks, it could propel dividend-focused portfolios to vastly greater monetary values that make the task of generating a worthwhile income far easier.

Questor says: hold
Ticker: LGEN
Share price at close: 247.7p

[rongetsrich] 12/1/2024 07:52

Sorry, final off subject post. Articl in the telegraph identifies the best kept secret in the finance world. It has been identied by Labour…. Nuff said!

[jubberjim] 11/1/2024 23:30

Well got there eventually

I was beginning to think 253 would never be breached
Stage one complete

Looking for 263 now to shift some more and add other likely investments

I am beginning to understand old Monty Hedge's reasoning as to why 605 should be attainable but it is going to be a long arduous climb under the current circumstances and the fear that is pervading the markets.

One step at a time and we will get there

Results Due (Happy to be corrected)

Abdn update 24/01 Results 27/2

Lgen Prelim 06/03

Av.Full Year 07/03

Phnx Results 22/03

Dlg No news at moment (awaiting dividend announcement)?

What a confusing week it has been

Good luck

[rongetsrich] 11/1/2024 22:11

It's sadly obvious. They will rape the fields of the seeds. It's sadly a given that they will get a massive majority, prepare now or keep quiet for the poor planning.

[williamcooper104] 11/1/2024 22:06

That's the current rules but the government is consulting about changing them Chances of a Labour government not changing it.....

[rongetsrich] 11/1/2024 21:57

Good points. Whilst nobody wants to die, like every facet of life... you have to have a plan, to avoid being that idiot in statistics.

[yf23_1] 11/1/2024 20:17

W104
"I think they’ve done away with the IHT exemption for pre 75 deaths "

eh ?

'
If you die before you turn 75, any pension death benefits you leave are free from income tax. However, once you turn 75, the recipients of these death benefits will pay income tax at their marginal rate.'

If you take the tax free bit, then of course it becomes part of your estate (for IHT).
If you don't take the tax-free bit, and you die after 75, then your recipient will be paying income tax on withdrawals some of which you could have had tax free.

[marktime1231] 11/1/2024 17:10

Oops, sorry everyone

[pierre oreilly] 11/1/2024 16:55

Just for those like me who experienced only one 500 quid win (plus many min wins) over donkeys years of holding 2x the Max pb holding, the biggish wins are possible. We won 50 grand last year, which changed the overall return to good from poor allowing for inflation.

[rongetsrich] 11/1/2024 13:52

You need to look at what Rachel Reeves said sometime last year. It may not have been headline news but I'm sure she has identified the lucrative income stream in stopping tax free withdrawals.My advice, take it or leave it, is plan for the worst. I'm taking the lump sum out, and if it's from a share sale I'll buy that share back again within an ISA. I may be out the market for a couple of weeks with that money, but these aren't red hot movers.

[marktime1231] 11/1/2024 13:46

Sorry to continue off topic ish, but £50K PBs are extendable to children and grandchildren too as nominee account holders, a safe tax free place to park big sums of cash while you decide whether to gift it permanently or whatever.

Back on topic, LGEN share price has a bit of life in it today, are we still in the foothills of a recovery up to the big dividend, could we be seeing the 270s or 280s again?