Wednesday Reads: FIRE might be more popular that I thought!

A round up of interesting or cool stuff I’ve read.

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Image by Muhammad Ma’ruf from Pixabay

 

Young people in the UK expect to retire before turning 64

According to a survey carried out for Hargreaves Lansdown, people up to age 34 expect to retire before turning 64, with 1 in 8 planning to retire before 55. If that’s the case, then FIRE is more popular than I thought! Even if most of them probably haven’t heard of the term.

I found it interesting that, contrary to the youngsters surveyed, most people over 55 didn’t expect to retire until at least 68, with some expecting to work past 70.

I wonder if these same people expected a relatively easy early retirement when they were 18-34, but just did not plan and save enough to achieve it? Or if the concept of an early retirement is relatively new.

Likewise, I wonder if the 18-34 year olds who were surveyed have a plan to actually retire by 55, or if it will just turn out to be wishful thinking? If you are 18 years old, you still have your whole life ahead of you. A lot can change!

 

HSBC considering charging for current accounts?

It was very tempting to title this edition of Wednesday Reads “the end of free banking??” but I didn’t want to have the same title for three out of the last four weeks!

The BBC reports that HSBC are considering charging for current accounts “in some countries.” Apparently they are still committed to providing free basic accounts for UK customers, but who knows how long that will last.

It’s worth bearing in mind that the UK banking sector is fairly unique in not charging for current accounts. HSBC itself charges for basic accounts in France, Canada and the US.

I wonder if the introduction of a monthly charge will spur people to switch away from that provider in droves? According to Which, there were only 1 million switches in all of 2019. Consumers are generally pretty apathetic, so I imagine that will continue.

Finally, let’s not forget that, when the rules for charging for overdrafts was changed, many banks settled on the same charge. Who’s to say that the same won’t happen with account fees?

 

Other interesting links that caught my eye this week:

• The ETF Educator ponders whether ETFs are driving valuations higher, but not for the reasons that are usually cited – Maybe ETFs ARE driving valuations higher.

 

• Why you shouldn’t max out your 401(k) on Of Dollars And Data. Specifically talks about the US retirement accounts, but also applies to the UK. Common advice in the UK is to max out your pension savings in order to take advantage of tax relief. But what if you unexpectedly find yourself needing the money in the next few years, rather than in 30+?

 

• The Incognito Money Scribe discusses how we can live a happy life now, rather than waiting for retirement – How to live like you’ve already retired.

 

• Free Beer Plus Profits! A Craft Brewery Investment Goes Full Circle by Physician on Fire. I really enjoyed this post by PoF going through his experience of investing in a local brewery. I like the idea of having a few “alternative” investments alongside the usual global trackers. Whilst they are unlikely to outperform any global index, they are much more interesting to talk and read about!

 

• It’s for the same reason that I’ve been reading about Investment Clubs recently (Motley Fool). Realistically speaking, it will be a long time before I get involved in something like this, if ever. I recognise that, logically, it makes far more sense to max out my ISA, pension, and the CGT allowance first. And even then, I certainly don’t think I’d be able to beat the stock market. But that isn’t really the point; it sounds fun to get together with friends and discuss finance and stocks, etc. Maybe I’m just missing social interaction after 6+ months of varying degrees of lockdown!

 

• The Evidence Based Investor reiterates the common rule of “past results are no guarantee of future returns” – Should you invest with Terry Smith?

 

• Tony from OneMillionJourney with a comprehensive review of his plan to become a millionaire by the time he turns 47

 

• SpaceX is apparently planning to make it’s own laws on Mars, via Yahoo Finance. On the face of it it sounds like a ridiculous statement, but it does raise an interesting point of who “owns” space? Who makes the rules?

 

• Sign up to Trading212 via this link and we both receive a free share.

 

Thanks for reading. Hope you’re all having a good week.