It's that time again. Friday night down at the local.
Except that this particular Friday night is a bit special.
It has been one long week since Chris had his long chat with Clem down at their local watering hole.
Chris, the young 32 year-old, and soon-to-be 33 year-old, had met his old friend Clem as he so often did on a Friday night.
Chris was given "leave of absence" by his missus so he could wind down after another hard day at the office!!
But the previous meet up of these two friends, one relatively young and naiive, and the other a wise old head, happened only the previous Friday evening when, by chance, Chris happened to touch on the subject of saving for his retirement.
By the end of that evening, Clem had given Chris a real brain dump on all things SIPP.
And Chris had vowed to stop procrastinating, do his homework and take action - on all the advice that old Clem had given to him.
And here they were, one week later, with Chris ready to spill the beans on all that he had promised to action, and old Clem waiting with baited breath to hear all about it.
Chris made it to the bar at the Golden Lion - the first round was on him.
He couldn't wait to pour out all his new-found knowledge onto his good friend Clem. The very man that sowed the seeds into Chris' mind in the first place.
They both got their pints of Timothy Taylors and sat down in a nice quite corner.
Then Chris couldn't get his words out fast enough.
"Clem," he said, "I owe so much to you. I could hardly sleep last Friday night and my poor wife, Sue, must have been bored to tears."
"I told her all about our discussion and how we should start tucking away some savings for the day when the kids have fledged, got married, had kids of their own, and we are ready to hang up our boots."
"She understood it all, just like I did. And all week-end it didn't stop there. We had Mum and Dad over for dinner and on Sunday we had Sue's Mom and Dad over and we just couldn't resist telling them about our plans"
"They were delighted for us and wished us well. They are both comfortably off. You know, mortgage paid for, two holidays a year, two cars, that sort of thing"
"In fact they were that eager for us to get off to a good start that they each gave us £5,000 to get our DIY Pension off to a flying start."
"So ... what do think I did?" said Chris "I don't know" said Clem, "What did you do?"
Chris replied, even more excited than before: "I got on my laptop and punched in that £10,000 start-up capital for my SIPP together with the £200 a month I was going to be saving anyway, you know, just like the calc we did last Friday night."
"And what did the Pension Pot Calculator reveal this time?" asked Clem.
"Take a look for yourself" said Chris, as he pulled a tablet out of his coat pocket.
"As you can see Clem, by starting with a lump sum of £10,000 - my projected total pension, were I to save £200 a month (but probbly more in later years) and retire at age 65, my pot would grow to £765,655.25 assuming that I could continure to achieve an average growth rate of 10%"
"That's over three quarters of a million pounds Clem. Wow!"
Chris knew he had to take immediate action.
All over the week-end he studied and read all about the ten SIPP providers that Clem had suggested to him.
He narrowed them down to three, out of which two really caught his eye as to providing everything that he wanted in a DIY pension.
Of course, he had to make a choice. He didn't toss a coin.
He was diligent in his choice. He had all the pros and all the cons listed on a piece of A4 paper. And in the final analysis he was spoilt for choice, but choose he had to.
He realised that this was one of the biggest events of his life and required his careful attention. With that in mind, he decided to take the day off work on the Monday and he sat by his trusty laptop for several hours and got everything signed up.
The money from his parents and in his in-laws was duly transferred into his personal account and that combined total got deposited into his brand spanking new SIPP account.
All done online. No outside interference whatsoever.
Everything would be signed and done with by Wednesday.
Both Chris and his wife were mega-excited. They knew that they had just embarked on to one of life's essential missions.
They couldn't wait to start thinking about what to invest their hard-earned into.
But there was no rush.
Chris was just a little over zealous. He couldn't wait. He knew what Clem had said to him about investing like Warren Buffett (for the most part) but perhaps the money was metaphorically, burning a hole in his SIPP account.
He had already decided that he would invest like Warren Buffett but with a few of his own ideas. For example, he was an engineer, and the thought of employing Technical Analysis in making his investment decisions appealed to him.
He had also started to read around his new-found subject.
His visit to the local Waterstones bookshop was the first thing he did on the Saturday morning. He also ordered a couple of works from Amazon that he couldn't find in Waterstones.
Chris and his wife talked about almost nothing but their new interest. They both knew that their enthusiasm would settle down, but for now, they were effervescent.
By Wednesday, Chris couldn't contain himself. He had studied the FTSE-100 index and its constituents and had made a short list. With his initial ten grand he was going to divide that into four lots - so he planned on investing £2,5K into each.
Everybody knew that a lot of stocks had been hit hard with the Corona virus, but some had made a partial recovery and some had actually gone up.
He had kept an eye on several blue chips, one of which was BT Group. And he noticed that this stock was almost at a low for the year and Chris reckoned he might bag a bargain - so he logged into his dealing platform software and managed to buy them for just under the psychological price of 100p. He got them for 99p. He bought 3,000 of them.
That cost him a total consideration of a little over £3,000. Just a wee bit more than £2,5K that he had allocated, but he liked "round numbers"
That would leave him with just under £7K in his kitty but with a £200 monthly contribution due very soon.
Chris told Clem of his busy week.
"Clem, I spent the whole,of last week-end finding out as much as I could about DIY Pensions. I logged on to that website you told me about. Everything that I needed to know was right there."
"I told you it would be" retorted Clem.
" Yes, I even bought some of the suggested books recommended on that site. I read and I read the whole week-end."
"Good for you" said Clem, "I'll be coming to you for advice before not too long."
"Idon't think so," said Chris, "You've got a heck of a head start on me."
Clem sat quiet for a bit and then said: "You are a very lucky young man. A happy, family man, with parents and in-laws that wish the best for you. Having £10K to start you off is just amazing. What a jump start."
"You are a very lucky young man."
"Carry on like this and you will be able to retire before 65. Young enough to enjoy it."
"Now, what are those shares you have on your short list and what have you invested in?"
Chris said: " I tell you what. Let's meet up again next Friday and I'll tell you what my big ideas are."
"Excellent idea," said Clem. "See you here next Friday. Same time. Same place."
And they both left before closing time, a little worse for wear, but not as bad as the week prior!
Chris and Clem Meet Up - hopefully, the last time before lockdown easing
Chris and Clem Meet Up - at last! They can meet in the beer garden
Chris and Clem Meet Up and it is Chris' turn to do most of the talking. Chris' little windfall has allowed him to widen his portfolio. Chris vows of more.