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UK Pension vs. Dubai Retirement Fund
The thought of the word "pension", sends a shiver
down most peoples spine..... unless you are an MP/Civil Servant,
with the best pension OUR money can buy!
Let's face some key facts about UK Pensions:
- The income generated within a pension is taxed.
- The income we take from a pension is taxed.
- At some point we have to buy an annuity and
our capital is lost.
- If we provide for ourselves we can lose
State Benefits at retirement.
- Insurance Companies profit from "managing"
our investments and they pay tax on their profits.
- If we create too much wealth in our pension,
(£1.5m), we are not allowed to contribute further.
- We can't invest in overseas residential
investment property using our pension fund.
- Unless you are a sports star, you have to wait
until at least age 50 to take your pension.
There is a pattern emerging here, the Government earn a fortune
in tax from the UK pension market and we, the private sector,
not only have to put up with this, but we have to help
fund the bloated pensions of the Public Sector!
The good news is that there is a very good alternative....... buy
an investment property in Dubai.
The concept is simple. You invest a deposit
in a property, rent it out for say 10 years and clear the
mortgage. Then you can enjoy the rental income.
I have selected Dubai for this exercise, simply because it
takes a lot to beat it. Here are just a few pointers as to
why it might be a good location to base your investments.
- It is totally tax free, that's correct, no CGT,
Income Tax or grubby Chancellor after your money!
- The population is continuing to grow faster than
they can build property.
- Forecast GDP indicates continued economic growth and
thus rental demand of property from Employers seeking
to recruit and locate staff
- Geographically acts as a trading zone for East
and West.
- Property prices still relatively low.
- 70% mortgages allow you to achieve "gearing"
of your investment, thus the growth return can be spectacular.
- On selected investments guaranteed
rental returns are available.
So now you have grasped the concept, let me demonstrate some
figures to you which illustrate the massive benefits of creating
your very own "Dubai Retirement Fund".
UK Pension
£18000 invested over 10 years and 15 years respectively.
| Fund after 10 years: |
£24,600 |
|
Income produced annually: |
£724 |
| Fund after 15 years: |
£24,600 |
|
Income produced annually: |
£943 |
Notes:
Figures taken from Standard Life on line calculator, based
on male aged 40.
All figures assume 2.5% RPI and 7% annualised growth and 50%
widow's pension.
Pension RPI linked. All figures illustrated in today's terms
Dubai Retirement Fund
£60000 property purchased, with £18000 deposit
and £42000 capital repayment mortgage.
| Value after 10 years: |
£60,000 |
|
Income produced annually: |
£4,800 |
| Value after 15 years: |
£60,000 |
|
Income produced annually: |
£4,800 |
Notes:
It has been assumed that both the capital and income failed
to grow over the terms to represent values in today's terms.
The 10 year example is based on a mortgage at 8% interest
and the 15 year example is based on a mortgage rate of 7.5%.
In the event of death, 100% of the rental income would continue
as income. The capital at the end of the term would continue
to vest in the owner's estate.
Now, let's summarise the differences, whilst excluding the
fantastic capital and rental growth opportunities: After 15
years the value of your Dubai property would
be £60,000 paying £4,800 annual income. The UK pension
would have a value of NIL, because you have to trade your
fund for an annuity of only £943 pa, which is less
than 20% of the Dubai Pension! It's a really difficult decision
isn't it? In reality a lot of research has to be undertaken
to ensure only the best
properties are selected, which is where our team of specialists
are well placed to help you.
The choice is now yours if you wish to make plans for your
future wealth:
- Bury your head in the sand and hope that you won't grow
old!
- Invest in a UK Pension and provide the chancellor with
plenty of tax!
- ACT NOW and invest in a "Dubai Retirement Fund".
Imagine the perfect city. Imagine high quality living at a
low cost. Imagine a safe cosmopolitan community. Imagine year
round sunshine, a tax free environment with low inflation
and a stable currency.  Imagine
your own piece of this perfect city from as little as £43,000.
You imagine...The Residences - International City
One Of The Most Exciting Real Estate Opportunities In The
World
The Residences are a fully managed complex in the centre
of International City phase 3. High specification development
of purpose built one bed and studio Apartments. Located just
12km from Dubai International Airport and a short
distance from Dubailand, destined to become the biggest
theme park in the world, The Residences present an excellent
opportunity for investment with potential for excellent
capital growth with the added benefit of guaranteed
income for 3 years.
Special features for this project:
- Fully furnished to a very high standard
- Air conditioning
- Designated parking
- Private balconies
- Government backed project
- Residence Visa to property owner
- Ideal Retirement Fund Investment
When you purchase a property in The Residences you have the
benefit of a 3 year rental guarantee of 8% net.
Prices are from:
| Studio Apt |
AED |
305,000 |
( approx. |
£43,000 ) |
| One bed Apt |
AED |
453,000 |
( approx. |
£61,000 ) |
Payment terms:
£1000 fully refundable reservation deposit
30% on signing Purchase contract
70% on completion mid 2008
No stage payments
Finance available with Abu Dhabi Bank and CBI Bank
The Residences - International City fits all the criteria
for a successful Fly-To-Let venture.
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