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Pension Millionaire By 50! Here’s How

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Speaker 1  0:01  

The purpose of wealth talk is to educate, inform, and hopefully entertain you on the subject of building your wealth. Wealth builders recommends you should always take independent financial tax or legal advice before making any decisions around your finances.

Christian Rodwell  0:19  

Well, welcome to episode 205 of wealth talk. My name is Christian Rodwell, the membership director of wealth builders joined today by our founder, Mr. Kevin Whelan. Hello, Kevin.

Unknown Speaker  0:28  

Hello, Chris got your teeth in, right?

Christian Rodwell  0:30  

Yeah, I know. It's just about just about. So here we are slap bang in the middle of summer, but still still delivering content still delivering value. And in fact, there's a bit of an anniversary that we're celebrating on this episode as well.

Speaker 3  0:45  

Yeah, definitely not mine. But I think the number 50 should play a big role. In our conversation today, Chris, I've been thinking about that was like to have a little bit of a theme for our podcasts. And, oh, it must be 50 years since Newcastle, United born anything. And anyone just up there for a few days took the family up there. And we watched a couple of games there where we were playing sort of a friendly, international friendly tournament and we played in America as well. So we came out of whatever it was now six games unbeaten four wins. Not a bad start. Yeah. And then they'll lose to the first game four nil or something. You know, it's just just the way it is. But it made me laugh. Because when you when you go to Newcastle and have a look around, it's completely full of women wearing almost nothing. Now that isn't the point. The point is, many of them are celebrating big star what they call the Big Five. Oh, so you've heard of the programme or Wi Fi though, right? She'll have it's a big one. Well, in God land they call it y e fibre. And they all go out in there next to nothing finery and celebrate by going on a club to club so he was funny watching what they get up to. It's just quite a weird place in the world I think I've ever been. Yeah. It could be minus five. And everybody's still wearing almost nothing. Yes. Just a weird place. But I love it.

Christian Rodwell  2:20  

I love Yeah. And you love the time bridge. And that could be the bridge to our other 50.

Speaker 3  2:25  

Thanks for moving me on. Yeah, I feel like you're stopping an old man from rambling. No,

Christian Rodwell  2:32  

no, continue to talk about the tune as long as you like.

Speaker 3  2:36  

Better than talking about follow us. But anyway, you know, I'm having a good time, obviously. But something I heard just a couple of weeks ago, made my blood completely boil. Right. I was astounded, horrified to learn that the current chancellor in his mansion house speech, which he does every summer has created a pact Can you believe, a pact a money making Act that allows the top nine insurance companies the big ones, Viva Legal and General Scottish Widows, you know, and more. They've all kind of got together and made a decision on our behalf. And the decision they've made is to change the default holding. So most people who don't pay much attention to the pension John and workplace pension. They get allocated into a fund unless they choose otherwise called the default fund. So default is for people to not pay attention. And we don't think that's a good idea. Well, builders, we believe you must pay attention. However, the vast majority of people we know 95% Don't pay attention. This default fund is now going to have an automatic allocation of up to 5% in startup tech funds, without you being able to choose whether you like it or not. Now, that might not sound like a bad thing, right? Oh, well, yeah, we're all interested in tech startups. And we all want to hear but the purpose of investing for retirement is to create certainty. Most tech companies don't work. Most tech companies fail. But more importantly, why why would the big insurers get involved? Well, they charge more money, they charge higher fees for the management of those things. So by default, without knowing a thing, the vast majority of people are going to have riskier funds, Ira charging funds, which means more of their money is being paid away to somebody else's wealth. The shareholders of the big insurance, let's say and They're not going to have anything they can do to change that. Unless they know more get involved. Of course, we want to encourage that, don't we? We want people not to default, not to automatically opt for something, which is another thing. I've maybe I've ranted about this before, Chris. So if you've got a pension, and you're listening, and you're in the UK, check out whether you're in the default fund. Or even worse, if you're in something called a lifestyle fund, where each year you're moved increasingly into, from equities into cash. Which means by the time you 55, you pretty much exclusively in the lowest risk investments or cash, which again, sounds like a reasonable bet, doesn't it? Well, why wouldn't I want to take less risk as I get towards return here, but the point is, you've got to manage then a life from, say, 55 or 60, to your 85 or 90. You can't do that if the money's just in cash. So the idea behind the lifestyle fund is that people will buy an annuity. Now, I'm not saying there's anything wrong with annuities. I mean, there are pros and cons of all investments. Like if you buy an annuity, you've given up all your cash, you give away all your capital to an insurer spit like a life insurance policy turned upside down. What I mean by that is with a luxurious policy, you pay a small premium to an insurance company. And if you die, they give you a lump sum and annuity you give them a lump sum, and they give you a small premium back taxable income. And of course, interest rates have been incredibly low over recent years, they've picked back up again. And there are many reasons why people might consider some of their money as an annuity, but all of your money, by default to an annuity where you lose flexibility and losing legacy. And we talk a lot, don't we about preserving and protecting the valuable assets we build in a lifestyle for the next generation? A default annuity means you're not. So I'm not saying here on this podcast. What's good, what's bad, what's indifferent. I'm saying you should know what you think and make a decision. Whether you should go for default lifestyle, without any involvement, or understanding of how your money's being treated, and whose money is anyway. Yeah, really gets me going that one. Anyway. Here's my thought, Chris, we do at wealth builders. For our members, we do something called a score report. I like the football score, you know, we won four nil against Villareal, for example. It's not that it's five things SEO or e. S stands for a statement of your likely benefits based on what you do. In other words, what you likely going to get in retirement. So you know, see, what are your charges? What are you actually paying, you know, what's the transparent number and your charges? Oh, what options? Have I got? Am I in the default fund? Am I in the lifestyle fund? What funds can I choose? So I can get more involved? I want to are, what are my retirement options? Do I have a choice, there's 2015, government brought in incredible flexibility. And II have I made an expression of wish so that if I die, the pension fund goes to who I want to my loved ones people are cared about completely free of inheritance tax score. And what I propose to do, Chris, is extend this to our podcast listeners 50 people, it matches the theme of today. Nice, if no more than that, because, you know, we normally charge them out at 295. You know, that's quite a bit of work to do. But I'll offer 50 for free. Or the first 50 People who email and contact us about that. And we'll obviously need to know what kind of punches here. I hasten to say, this is not advice. This is not the lead to advice, it's going to lead to awareness. Because awareness gives clarity on then where do you go next? And that's not for me to say, but I'll give away 50 Score Reports Chris. So Where Where would people go for them?

Christian Rodwell  9:32  

That's very kind. Yes. So I would say the easiest way would be to drop us an email Hello at wealth and pop the word score in the subject line. And we'll have our team look out for those. And the first 50 People will be lucky winners.

Speaker 3  9:49  

Yeah. Fair enough. And you know, if we find somebody's not got a pension, they wanted a score report but just weren't eligible for one. But they've got a workplace pension. Like a final salary pension, we'll extend it to more. So, you know, we'll we'll probably accept 75 Say, knowing that some people won't be eligible for that. But yeah, everything about pensions, Chris, it's all about awareness. So all about being getting a sense doing a stocktake of where you are, and working out what you're likely to get, most people have never done. That calculation is like going on a foreign trip. And you don't know what the exchange rate is between your currency and the currency of retirement. You just don't know what's going on. And I'd like to bring a little bit more awareness to people because 95% of the population we know don't make it because they rely enough, but at least if you can improve it, it's better than nothing. Isn't it? Really?

Christian Rodwell  10:48  

Yeah. Yeah. Well, we've titled this podcast, pensioner millionaire by 50. Pension millionaire. Yeah. So I guess well, people will be curious as to what is this magic formula, Kevin?

Speaker 3  11:01  

Well, the magic formula is, it's an issue where if you think about what's likely to generate an income, or a pension fund worth a million pounds, to someone age 50. And the big dynamic, the big piece of leverage that's involved in now is time. So I guess if you're the podcast listener, it's not you. It's going to be your children, began grandchildren. So slightly differently, if you. But I've told this story before, I've known about setting up an alternative, again, on the on the families programme, called more about what you can do for your kids with junior ices and junior sips and junior stakeholders, all the sorts of things that you can give your next generation or your grandchildren, or get them really set up for life. And I think if you can set them up for life for a small cost. And if you were to take out a pension, which you can, any child can have a pension, they don't have to be 18, or anything more of the age in a minute. You you can pay up to 3600 pound gross a year. So take the tax relief off that because even babies get tax relief to have you started a pension and you paid in tune and 40 quid a month, or your child or your grandchild or a niece or nephew. And you set that running and you had enough money for it to run until they were 50. As the stock market just performs what it does, on average, with booms and busts around about 6% They'd be pension millionaires by 50. For 240 quid a month. Now I'm not saying 240 quid a month is a small sum of money it's not. But if you're in a financial position where that's something you can do for your children, or somebody you care about or your grandchildren like me, then this the grandparents actually, probably not listening to this podcast, but the day you could turn your granddad or grandma about this good noon. So would you like to make little Johnny little Johnny pension millionaires by 50? Can you spare to avoid when a month, which by the way, if you pay that out of your income, would be inheritance tax free as well, we covered that few podcasts ago, then, even if they didn't take that much interest in wealth building. And they didn't learn all the lessons, we're trying to teach in wealth builders for families, they'd still be millionaires by the time they're 50. And I think that's a valuable lesson that children have got time, most of the people don't have time. And when you don't have time, to be the piece of leverage, you have to get involved, improve the return more than 6%. And you can only do that by discovering the more wealth building pillars, or the more wealth building entrepreneurial ways you can, you can influence things, which is why as you know when it comes to the world of pensions. I'm a big fan of the SAS pension. But before we talk about that, and the number 50 relates to the show, usually about this time we do a review, Chris?

Christian Rodwell  14:30  

Yeah, it sure is. So let's not let our listeners down. Let's read out one of our latest reviews from Trustpilot. And we've had a review this week from Scott, who kindly says a very informative introductory call with Gary Whelan, who explained SAS in greater detail for me, and how it wouldn't necessarily suit me at this time. He was also able to help unpack some questions I had about building wealth investing and limited companies. Overall, it felt Gary truly wanted to help up, and I appreciate the genuine interest he showed, I will continue to listen to the podcasts, which are a great source of free information. And I will continue to follow wealth builders and use their services to help build a legacy for my family.

Speaker 3  15:13  

Very nice. And yes, there is another wheel in the frame. So I think Gary's name has come up before, isn't it? So Gary's my younger brother who lives in in Newcastle. And he shares the same ethics and integrity, as I do is that demonstrates there? And he's a SAS expert. And, and I like the fact that he's embraced that expertise. Because, you know, when when I talk to people about SAS, person, but those people have not heard that word before. That's the very problem right there. Right? I mean, if you're going to win a marketing prize, you wouldn't, you wouldn't use the word SAS. So but it's but it's a creature of back in the 70s. I mean, it was the Finance Act 1970. If I recall it, Chris, that brought the whole pension into life, which basically was the way I describe it is a family trust fund. But in order to be eligible for one, and who wouldn't want a family trust fund sounds so much sexier, doesn't it? Family Trust Fund, it's much better than got a SAS don't know what a SAS is, right. But it's a trust fund or pensions or trust funds. But you can extend that to your wider family, up to a maximum of 11 people, which, okay, Kevin Whelan sounds like an Irish name definitely is. But I'm not an Irish family. So I don't have 11 people in it, but I've got five in my family. So that's easy. You can involve or five members of your family as long as they're over 18. So this is the real opportunity, then that you can bring and involve your children and get them started on the pension and early with whatever some of the money you can afford, get tax relief before they even get become taxpayers. And then when they're 18, they join you in a SAS provided you've got a business. Now, obviously, the gentleman there who did the review was ineligible. And that eligibility is normally they don't have a limited company yet. But most of our wealth builder members, Chris at some time cradle limited company, because they see the benefit of the tax reliefs and the tax benefits that having a limited company can bring. And some even set up limited companies, with their children, and they, and they create many entrepreneurs or young entrepreneurs and more of that in the wealth builders for families programme, and I'm definitely looking to be sponsoring or giving scholarships to young entrepreneurs. So again, if you've got a young entrepreneur in the in the family, and you know, their burgeoning their ideas, then you know, we could give them a shout out. We could give them a podcast, representation or guesting, if you like, and Where would people tell us about that, Chris?

Christian Rodwell  18:10  

Well, definitely you can get on the waitlist for the families programme that we're putting together. So head to wealth forward slash families, and leave us your name and email and we'll keep you updated. Or just stay tuned over the coming weeks because we'll have lots of exciting updates regarding the families coming up.

Speaker 3  18:30  

And if they've got a particular story about a young entrepreneur, yeah,

Christian Rodwell  18:33  

yeah, just touch Yeah, drop us an email Hello at wealth below as always the best place? Yeah.

Speaker 3  18:39  

Fair enough. Fair enough. So anyway, SAS is then first SAS was done in 19 7350 years old. Right? The SAS is off. 50 years old. When I talk to people about you can get tax relief. You can invest in property, you can invest in business, you can invest in gold, you can invest in the stock market at a discount, because you don't need to pay an advisor. You can buy cryptocurrency, you can do Commercial to Residential conversions. You can do so many different things. You can buy gold bullion, you can do so many things that float your boat that reflect your values, your wishes, your preferences. If you can do that, why would you not do that? Rather than go to a default fund, and be completely out of control for the rest of your life and hope and pray that you've got enough money in your pocket to live to 85 or 90, or your kids to 100 Get them involved early. So by having a SAS you can bring them in to the SAS at 18 and teach them things. You don't have to get them involved. Specifically, you could get them involved before that. You could say hey, as a family, we've got a family trust fund, you're not eligible to join until you're 18. But if we If we gave you 10,000 pounds, 20,000 pounds, whatever to think about what you would do that to help grow the families, well, what would you do? And then you've got little project, haven't you, you've got a little something that gets people involved. Because one of the biggest issues I'm discovering Chris about the difference between smart and savvy kids and entitled ones are the ones who own something and take responsibility, and feel part of something are much more likely to be the smart savvy ones. And the ones who just expect that everything is going to be done for them, will become the entitled ones. Now, it's not my place to say whose kids are who's and I'm not trying to be a parenting guru of any kind. But I would say that the more you can encourage younger ones to get involved in make decisions and make mistakes, of course, the more they'll be able to make good decisions when they're grownups. And that's really at the end of the day, what we want, isn't it financially savvy, responsible. People making good decisions, not bad ones are so many dangers have highlighted before that are out there to catch him build traps. And sometimes were the cause of those things, by giving things because they don't see what's behind it. For example, people know you go to work, but don't see the work you do. When you could change that. They know you earn money, but they don't see how that money gets taxed, and where that money goes and what you thought of to share that. So these are just some of the points that you know, you don't want your kids being 50 and poor. You know, you want to get them to 50 and be completely set for life, if not before, because of the good work you do and building your own family wealth plan, of which I think SAS is a linchpin in that entire process because of all the tax breaks and inheritance tax free. Capital Gains Tax Free, income tax free, in a national insurance free, corporation tax free, there, frictionless pension, that allows you to maximise the return and mitigate the risks in ways that other pensions don't allow. So yeah, I'm a big fan. Now, I haven't had a SAS for 50 years before you ask you cheeky person. I've had a SAS for about 13 years now. But I absolutely love my SAS. And I encourage anybody to look into it, whether you look into it with our help, or externally, that's not my issue. If the tide of more people earning sasses rises, then that's going to benefit more families. And I'm happy with that.

Christian Rodwell  22:47  

Yeah, no, that's great. So really, we're kind of talking about different steps and stages, as children grow up and different things that you can be doing from a very, very early age, as you say, almost, you know, as soon as they're born, just getting some contributions going. And then as they grow up, start to share some of that wisdom. And of course, this is very much what we're doing now, age appropriate content that we're building out as part of the families programme, which we'll be sharing more of, over the coming weeks and months.

Speaker 3  23:12  

Yes, and I've been spending all day today just doing that very thing, Chris. So you call me kind of mid content, writing and video curating. And again, you know, if you've got a great book you've read or a great lesson you want to share, or as I said earlier on, you've got a young entrepreneur in the midst, or one in the making, then we'd definitely like to know about that. Because we're curating the content. We're not owning the content, we're trying to be the best librarians we can to kind of get rid of all the the nonsense and stuff that's out there that you could just simply consume. But it's that combination of education plus support, plus connections plus community, plus events, plus, plus plus, that we're trying to grow into 50,000 people filling St. James's Park or being happy families have other

Christian Rodwell  24:08  

was good. Sounds good. So we've got lots of free content available already. Kevin, of course, listeners can go to our website wealth And we've got some pre recorded webinars there about SAS pensions about the wider holistic seven pillars, of course that we help our members with and yeah, and CIT vs. SAS as well, which is also a common question we get asked, isn't it but

Speaker 3  24:34  

a lot and in fact, without SAS as we've never had sips I mean, sips only came in in 1990. So SAS has been around a lot longer. But it was the it was the ineligibility of people who couldn't qualify for SaaS that made the Chancellor of the day create sips, as in 1990. But sips proliferated, mostly because the SIP companies control what you invest in You know, it's sort of almost like a pretend SAS, it's not really a lot of flexibility not in most sips, most sips and very heavily restricted. But SAS gives that incredible flexibility. But with that flexibility comes responsibility, Chris. So I'm not saying everybody should get a SAS and you heard from that review, obviously carried had a conversation with that gentleman and said, not sure it's a good fit for you. And we can continually do that. Just to make sure that SAS is only going to be fit for purpose for someone who's fit to run it. And in other words, make decisions, understand the risks and be willing to learn a bit more than the average person knows about a pension.

Christian Rodwell  25:41  

Yeah, yeah. And we open up several slots every week, don't we, Kevin? For anyone listening, who just wants to have a chat about their pensions, you know, maybe find out a little bit more about SAS and see what's the right fit for them. And if you'd like to book a call with one of our team, head to wealth builders dot code at UK, forward slash discovery call and book yourself in and we'd love to chat to you

Speaker 3  26:01  

now or just avail yourself of one of the 50 free score reports if you don't fancy a chat just yet. That's really no problem. I think people realise by now we, we take our time, not 50 years, we would like people to make a decision in 60 months because it takes about 60 months to be financially independent, doesn't it? So five years, so whether it's five or 50, you can make it set a pension up for a youngster. Do them a favour, there'll be pension millionaires by 50. Or get stuck into your own plan, and you'll be financially set for life within five years. Anyway. People will.

Christian Rodwell  26:36  

There we go. Well, we better go and put a party hat on and grab a slice of cake to celebrate big anniversary. And hope you've enjoyed listening today. Don't forget to drop us an email. Yeah, hello at wealth If you'd like to grab one of those score reports, and Kevin we will catch up same time same place next week.

Unknown Speaker  26:55  

This we will indeed my friend until then.

Speaker 1  27:02  

We hope you enjoy today's episode. Don't forget that we are constantly updating our resources inside a wealth builders membership site to help you create build and protect your wealth. Head over to wealth right now for free access. That's wealth

Episode notes

In this episode of WealthTalk, we dive deep into the secrets to achieving pension millionaire status by the age of 50. 

Kevin and Christian explore the tangible steps, insightful strategies, and investment techniques you can utilise to navigate the complex landscape of pension investments, seize opportunities, and make your retirement years truly golden for yourself or future generations.

Whether you’re working on your own financial planning journey or building a plan for your loved ones, this episode will empower you with the knowledge and inspiration needed to transform your pension into a powerful wealth-building tool.

Resources mentioned in this episode