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The Iron Wealth Blog
It’s Less About Numbers, More About Judgment
When Markets Don’t Feel Fair: How We Reduce the Risk of Being on the Wrong Side of the Trade
In the world of investing, there is always something trending and receives a lot of attention.
We've been taught to save for a rainy day, which is wise to some extent. However, keeping all your money in cash over the medium to long term carries risks, too. In fact, doing nothing with your money is the biggest risk of all, as inflation will erode its value over time.
We are 5! This month we are celebrating Iron Wealth turning 5 years old. We are so ever thankful for everything we have achieved.
Is it worth switching your investment portfolio to cash? In this blog, we discuss why cash isn't all it's hyped up to be, even at 5%.
There is no better time to size your unsheltered portfolio correctly.
Fact: They are rare, inevitable and are a feature of the markets.
An Alternative Source of Income/Capital: Equity Release & Retirement Mortgage
A common question that you may have heard or asked is “What is the income/yield?” But have you truly thought about the meaning of this question? Firstly, what do they mean by “yield”? Yield is what you get back from your investment, the interest or dividend you receive. Many people like the thought of a stable, sustainable income and therefore, they focus on obtaining a high income. This is especially true for those approaching and/or in retirement. After Years of earning a regular income through our wages, we are bias towards continuing this approach with our pensions and investments. This is another reason why most people would opt for an income stream in the form of a final salary pension over a lump sum. We saw an example of this when Camelot launched ‘set for life’ in 2019, where instead of winning the jackpot as a lump sum, the winner would receive £10,000 a month for life. A lump sum has its benefits too, it gives us flexibility, control, inflation proofing and the ability to manage counterparty risk (the probability of default). Of course, this all depends on individual circumstances and objectives. If you structure an investment portfolio for maximum income/yield only, or as your main objective, you distort the portfolio, leading to far higher risks and can potentially lead to higher taxation in the future.
