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Election: Good News for Tax-Free Compounding …

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The election campaign has been pretty dull so far, but this week brought unexpected good news on pensions.

I’m surprised there wasn’t more excitement around this.  It will have a huge impact on many.

In summary, Rachel Reeves – our next Chancellor in 3 weeks – said Labour will not bring back the Lifetime Allowance (LTA) on Pensions.

The LTA (£1.07m) was abolished by Jeremy Hunt last year but, at that time, Labour said it would bring it back.  This week’s U-turn by Rachel Reeves means no limits on how much your pension can grow to without penalties.

I know pensions aren’t the most exciting topic.  So let me reframe it …

If you like the idea of free money from HMRC (£ tens/hundreds of thousands – here‘s how) … And for it to compound and cement your financial security – this week’s news is worth getting excited about!

EVEN if you think you are nowhere near the LTA of £1.07m, please don’t underestimate the power of compounding for your future.

The chart below shows how a pension can grow over just one or two decades.  Simply by passively sitting in global equities …

This represents actual growth of global equities (MSCI World Index, GBP) over the last 10 and 20 years.

Your capital would have TRIPLED over the last 10 years and 6X over the last 20 years.  Simply by being in global equities.  Passively and tax-free.   And now, without limits.

This combination of ‘free money’ from pension contributions + compounded growth in stocks is beyond any expectations for most people.

Make sure you understand this to passively build, secure and cement your financial security and independence.

Always Remember:

  • Time in the Markets always beats timing the markets
  • Stay Diversified 
  • Minimise those leakages:  Fees, Inflation, and Taxes
  • Financial Markets are a great source of recurring income  
  • ETFs, Balanced Funds and Options achieve all the above
  • Being educated helps you outperform 99% of the population

 

… to ensure your investments work for YOUR financial freedom (not someone else’s)     

And … 

For more guidance, our Investment Academy will help you implement all of this in a step-by-step way.   

Thousands of people have learnt how to diversify and pound-cost-average into low-cost, set-and-forget ETFs & Funds for inflation-beating growth.  And Options to create recurring income.

Click here to learn about our Investment Academy

Finally …

– Don’t take the above as advice as it may not apply to you personally

– Your Capital is at Risk

– You may not be covered by the FSCS

– Anything mentioned in a podcast or in a previous article was valid at that time and may not continue to be now           

Stockmarket Investment Academy … Step-by-Step Training to Diversify your Wealth and Create Passive Compounding in the Markets (click image below for details …)

About Me

Manish Kataria is a Fund Manager. A CFA-qualified professional with 18 years’ experience in investment management and UK property. He has managed investment portfolios for JPMorgan and other blue chip investment houses. Asset classes managed include Equities, ETFs, Bonds, Funds and Options. Within property, he invests in and owns a range of assets including developments, HMOs, BTLs and serviced accommodation. InvestLikeAPro was set up so anyone can invest like a pro.

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