What is your retirement plan? annuity ? drawdown ? Other cash reserves / investments?
"normally" derisking means someone is likely to go annuity route, if your going drawdown route, your need to find a balance somewhere.
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What is your retirement plan? annuity ? drawdown ? Other cash reserves / investments?
"normally" derisking means someone is likely to go annuity route, if your going drawdown route, your need to find a balance somewhere.
You can build your own RPI linked annuity with linkers and not lose your capital.
Gilt ladders are very simple, you have a guaranteed pile of capital maturing each year for your spending and you can invest the rest of your cash in equity without having sleepless nights about a crash or losing your capital to an insurance company with an annuity where the income is also taxable.
Gilt ladders are very simple, you have a guaranteed pile of capital maturing each year for your spending and you can invest the rest of your cash in equity without having sleepless nights about a crash or losing your capital to an insurance company with an annuity where the income is also taxable.
Bond ladders take a lot of work to constantly rebalance. Ibonds ladder ETFs make this easier , and tradable, but i'm not sure they one for GB gilts so you would have FX risks.
I currently use the BOXX etf for my US investments as this results in capital gains instead fixed income, and thus is tax free for me, but most gains are lost due to the weak dollar.
I currently use the BOXX etf for my US investments as this results in capital gains instead fixed income, and thus is tax free for me, but most gains are lost due to the weak dollar.
Bond ladders are actually very simple. There is hardly any rebalancing, you just wait for each bond to mature and then either spend the money or buy another bond so in reality a bond ladder equals at most 1 trade per year.
Tax treatment differs wherever you are but in the UK outside of tax wrappers you still have to pay income tax on interest distributions even if they are reinvested by the manager in an accumulation fund so choosing an ETF rather than building your own ladder with lower coupon gilts puts you at a significant tax disadvantage as well.
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It depends on the frequency of money you want but to get a stable income you are usually buying bonds each month and have to carefully buy bonds maturing at e.g 3 months, 6 months, 1 year, 2 year, 3 year, 5 year, 10 years.
The purpose of BOXX os the income is not intererst because it uses a box spread as a combo of short and long positions..The expected return matches short term bonds but is technically an equity and not a fixed income device (unless the tax authorities invent a new taxation rule). So at least at the moment, it is capital gain and thus tax free for people who live in countries without capital gains taxes.
It can be as simple as you want though, your claim that they take a lot of work to constantly rebalance is only true if you deliberately make it such.
So quite niche and considering this is someone in the UK the idea of using ETFs for some sort of tax advantage is not even relevant. Individual gilts have the tax advantage here.
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If you are not building a ladder with staggered maturities then by definition you are not building a gilt ladder.
If you want to have monthly income in 10 years time then you will be buying 10 year gilts each month. That is how bond ladders work.
Not really niche, it is the same complexity as a bond ladder. BOXX is an etf, so you just buy and forget. It is in USD, mainly designed for US customers who do pay capital gains tax, but capital gain tax is less than the income tax you get on interest, leading yo a tax saving. This is similar in the UK
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Drawdown & will also be supplementing my income with rent from a house in the UK.
I have savings to last me up until retirement at which point I will need to start to drawdown a modest amount to supplement my rental income. I'm also working on a "plan B" software project that I've had under wraps for a while. Whther or not that will come to fruition, who knows? You can but try
No, that is deliberately making things complicated. A gilt ladder can be as simple as buying one gilt to mature each year. This is a ladder of staggered maturities. People have rolling ladders of just 3 index linked gilts giving them inflation protection and as one matures they buy another. This is a rolling ladder. You absolutely do not need to be buying 10 year gilts every month..
Drawdown & will also be supplementing my income with rent from a house in the UK.
I have savings to last me up until retirement at which point I will need to start to drawdown a modest amount to supplement my rental income. I'm also working on a "plan B" software project that I've had under wraps for a while. Whther or not that will come to fruition, who knows? You can but try
If going drawdown - why derisk - you've potentially got 20-30-40 years ahead of you for the fund to continue to pay out/grow etc.
Don't over complicate it - keep it simple, spread of funds/eft's and let them work for you and balance your income accordingly.
rebalance to an allocation that suits you better for decumulation (during retirement)
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Well, I guess the received wisdom, as I see it from quite a lot of research I've done, is that it's good to de-risk when you are as close to (semi) retirement as I am.
Thinking aloud here - if I remain solely invested in equities, for example, and there is a massive crash the day before I need to access my funds it will mean that I am selling my holdings at a huge loss to generate some income, whereas if I've at least done some de-risking to cover my first few years of semi retirement, I won't have incurred that loss because the income will come from the de-risked pot of my portfolio. In the meantime, I'll still have a percentage invested in equities which can be allowed to recover in due course.
That may/may not make any sense whatsoever.
You're spot on there. Sounds like you've done all the research. Its all about managing risk especially in the early years of retirement when you are heavily exposed to a sequence of returns risk type scenario moving against you.
You don't want to get out of equity as you say, just enough so you don't have to worry about any market moves damaging your lifestyle.
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Saw an interesting article about how Americans are hoovering up the cheap U.K stocks. - https://www.reuters.com/markets/eur...one-forgot-tell-british-investors-2025-08-21/
Depends where they operate. If they are international. Yes, I'm sure some are cheap. But UK is going through another inflationary period and job losses/unemployment spike.
The unemployment spike and economic weakness is driving the last rate cut.
Not ideal...
They can but there is no real alternative. Intel are still in most servers, especially the top end stuff. AMD are also a US company.
Maybe they aren't seeing how things really are on the ground.
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Agreed, the alterantives are AMD were the US have inteory less controll over..
ARM is also up and coming on server CPU not technically US, which may be the best alternative to intel as its licencing more than manufacturing a standard theres also lots of already expirenced people in the industry for moile phones and similar.
ARM is also up and coming on server CPU not technically US, which may be the best alternative to intel as its licencing more than manufacturing a standard theres also lots of already expirenced people in the industry for moile phones and similar.
Looks like the US market is crabbing today. Presumably waiting for NVDA to report. A lot of noise around AI bubble might be deflating slowly so numbers need to be good to keep this rally going.
Saw a briefing from one of the US banks suggesting that September looking increasingly like there might be a bit of a sell off.
Saw a briefing from one of the US banks suggesting that September looking increasingly like there might be a bit of a sell off.
iam down £1400 in one of my shares, oh well looks like long term hold, at least i am getting good divs.