State Pension UK: Boris Johnson makes new Triple Lock commitment but will you miss out?

State Pension is provided by the government for Britons who have worked for decades within the UK, and is a sum to help them during retirement. The full State Pension amount increases every year under the Triple Lock Guarantee. This means it rises depending on which is the greatest of 2.5 percent, the percentage growth in prices in the UK, or the average increase in wages.

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This year, the State Pension rose by 3.9 percent, in line with average earnings. 

When recently asked about his Triple Lock manifesto commitments, Prime Minister Boris Johnson stated he would “meet all of our manifesto commitments, unless I specifically tell you otherwise.”

He added: “It’s an important point, and we won’t be blown off. Of course, we are on track to delivering these things.”

This statement provided buoyancy and reassurance to pensioners looking to secure a comfortable retirement. 

However, it is important to note a certain group may not be entitled to the Triple Lock commitment.

Those who have chosen to retire abroad in specific countries have faced the prospect of their State Pension entitlement being frozen at the rate it was when they left the UK.

While it is possible to claim the new State Pension overseas in most countries, the annual increase is only available to pensioners living in certain places.

Those who live abroad only receive a rise if they live in the European Economic Area (EEA), Gibraltar, Switzerland, and certain countries which have a social security agreement with the UK.

The majority of those affected by a freeze to their pension amount live in Australia, Canada, New Zealand and South Africa. 

The government website states that although the UK has social security agreements with Canada and New Zealand, “you cannot get a yearly increase in your UK State Pension if you live in either of those countries”.

It is estimated some 550,000 British pensioners who live overseas could miss out on annual State Pension hikes.

However, there is good news for Britons who have retired to European Union countries.

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These people are set to see their pension increase in line with Triple Lock, thanks to the UK government’s withdrawal agreement which has negotiated reciprocal rights for State Pension increases. 

This is after concern rose that British retirees living in EU or EEA countries could lose out on pension rises in the event of a no-deal Brexit.

However, it is important to note those moving abroad to these countries after 2020 could see their pension payments frozen.

This is because these rises are conditional to a withdrawal agreement and whether arrangements with the EU are in place on January 31, 2020. 

Those who move to countries which do not have an agreement with the UK will be affected by the freeze unless they return to the country.

Recently, there have been calls to scrap the Triple Lock system in the UK to cover the increasing cost of the COVID-19 crisis.

A document viewed by the Telegraph suggested the Treasury could look to scrap the protection.

Treasury officials appear to have advised the Chancellor Rishi Sunak that it is “better to break the tax lock to achieve revenue of this scale than attempt to raise this level of revenue with this constraint”.

The officials argued stopping the cost of the pension triple lock could produce savings of circa £8billion per annum “when compared to the base case”. 

Pensioners who retired before April 6, 2016, are entitled to the ‘old’ State Pension system which could see them receive up to £134.25 per week.

Those who retired after this date will fall under the New State Pension system, and could gain a maximum of £175.25.

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Council Tax: Who do I pay my Council Tax to?

Council tax is a tax on domestic property, but some property is exempt from Council Tax.

You may not have to pay Council Tax, or you might get a discount.

All homes are assigned a Council Tax valuation band by the Valuation Office Agency.

The band you get is based on the value of your home as of April 1, 1991, and a different amount of council tax is charged on each band. The rate per band is set yearly.

Who do I pay my Council Tax to?

You pay your Council Tax to your local council, which then allocates the extra funding to one of several services.

Council members will allocate money to local education, leisure, police, firemen and other services.

Council Tax pays for:

  • Police and fire services
  • Leisure and recreation projects such as parks and sports centre upkee
  • Libraries and education services
  • Rubbish and waste collection and disposal
  • Transport and highway services including street lighting and cleaning, and road maintenance
  • Environmental health and trading standards
  • Administration and record-keeping, like marriages, deaths and birth, and local elections

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Council Tax is a yearly bill, split into 10 monthly payments.

Most councils will allow you to spread the bill out over 12 months, though.

Paying the same amount every month will be easier for some households.

You can ask your local council if this option is available for you if you are struggling to pay. Find your local council contact details here.

What does your Council Tax bill tell you

Your Council Tax bill tells you the following things:
• how much you have to pay for the year
• how that amount has been worked out
• the dates you have to pay

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How to pay your Council Tax bill

Most people pay their Council Tax bill online.

Alternatively, you can normally pay in cash using ‘Paypoint’, ‘Payzone’, or ‘Quickcards’.

You can normally do this at post offices, banks, newsagents and convenience stores, but ring in to check if this option is available during the pandemic.

Your bill should tell you which other payment methods are available.

How to defer Council Tax payment

Andy Barr, the co-founder of www.Alertr.co.uk, told Express.co.uk:
“Ideally the local authorities would have the same approach as the majority of the banks do for mortgage holidays, i.e. online applications and an automated process.

“However, each authority is going to have its own rules and policies, and this is something we have seen regarding the business grants as well.

“It is clear that whilst the Government drives the overall strategy and plan, the individual authorities deliver and administer these plans in a way that they feel is most practical.

“The best thing you can do is go to them early if you are facing payment problems.

“Check the local authority website for the preferred form of communication at the moment and be prepared for long call times.

“Going to them before you miss a payment is always a stronger approach than going to them after you have missed a payment.”

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Business experts push for Bank Holiday in October 2020 – potential boost of millions to UK

Bank Holidays are set aside throughout the United Kingdom as public holidays which often involve time off work, long weekends and an increase in spending. A number of Bank Holidays throughout April and May have been missed as a result of coronavirus lockdown, with tourist agency VisitBritain estimating £37billion could be lost as a result of COVID-19. However, the body has suggested an extra Bank Holiday, potentially coinciding with the school half-term break in October to boost the economy once again.

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And a prominent economist has added to the suggestion, stating this extra holiday could provide millions to the British economy.

Douglas McWilliams, deputy chair of the Centre for Economics and Business Research (CEBR), said an extra national holiday could swell the economy by £500million.

Mr McWilliams said: “This year it would be quite likely that the boosts to spending in retail, hospitality and catering from an extra bank holiday after a period of enforced abstinence might well be double the usual boost, adding up to as much as £440m. 

“There could well be a further stimulus from tourism boosting the UK economy by an additional £50m. So a rough £500m a day boost from more spending.”

Mr McWilliams has also suggested a four day working week may also provide financial assistance to the UK. 

The demand for extra bank holidays has always been high, however, it appears the ‘lost time’ throughout the coronavirus crisis has only swelled these desires.

In 2019, the Trades Union Congress (TUC) called for additional Bank Holidays in the UK, after it was argued the holiday entitlement in Britain was the stingiest in the European Union.

TUC chiefs urged the government in England and Wales to match the average number of Bank Holidays in the EU, which currently stands at 12.

The CEBR previously argued bank holidays were too costly, and in 2012, asked: “Do we really need so many?”

Mr McWilliam’s announcement, then, appears to show the opinions of the thinktank are changing to meet the desires of the wider British public.

Last year the CEBR said its previous estimates that bank holidays cost the British economy £2.3billion per day were in fact proven to be much lower upon further research.

This is because the organisation believes lost productivity is likely to be made up elsewhere. 

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Patricia Yates, acting chief executive of VisitBritain stressed the need to generate tourism throughout the year, and not solely in the summer months of July and August, where bank holidays traditionally fall. 

She added: “Given that it has to be the year of domestic tourism, there’s a real job to be done there in convincing people that it is socially responsible to travel and enjoy a holiday, and that it is safe to do so.”

Ms Yates stated the 2020 tourism season had been effectively “lost” as a result of the coronavirus crisis, and that extra help was needed to make it through until next spring.

However, it is as of yet unclear whether the government will take up the proposals of VisitBritain.

Downing Street stated the proposal would be visited in due course, with the government supporting the tourism industry throughout lockdown.

A spokesperson said: “It is worth acknowledging that an extra bank holiday comes with economic costs.”

Holiday resorts and tourism destinations are anticipating government announcements, but have tentative plans to open at the end of May.

However, there is uncertainty as to whether hesitancy surrounding the virus will stop tourist visits, or whether removal of lockdown could create a holiday boom. 

Source: Read Full Article

Council Tax reduction on PIP: Can I get Council Tax reduction on PIP?

Personal Independence Payment (PIP) is a vital benefit for millions of people in the UK who find themselves living with a long-term disability. Those living with a spectrum of life-altering conditions can receive hundreds of pounds from the Government per week on top of some additional boons.

Can you get a council tax reduction on PIP?

PIP provides millions of disabled people with amounts ranging from £23.60 to £151.40 per week.

To claim the amount, they must first undergo an assessment from a health professional to work out the level of help they require.

The benefits are then subject to regular reviews, and will also allow people to claim a council tax reduction.

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According to the Money Advice Service, people on the daily living or mobility component of PIP can get money off their Council Tax bill.

The overall discount depends on the PIP rate and components people receive, and people can find exact amounts by contacting their council.

Those who contact local officials may find they need to send in a copy of their PIP award letter before they receive a discount.

The rules also apply to people who have had their homes extended to help their mobility, as it could push them into another Council Tax band.

People may also secure a council tax reduction if they fall into one of the following categories:

  • Low-income households
  • Student households
  • Adults living alone
  • Other benefit claimants, such as JSA, Income Support, Pension Credit, Employment and Support Allowance and Universal Credit
  • Mentally impaired or living with someone who is severely mentally impaired
  • Care leavers in Scotland, who are exempt from Council Tax between 18 and 26
  • Care leavers living in certain English/Welsh councils
  • Armed forces members depending on circumstances
  • Care home or hospital residents
  • Prisoners, unless they are in prison for not paying Council Tax

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How does Council Tax work?

Council Tax is a local Government fee used to help officials pay for vital services.

Libraries, public works and environmental health amongst others rely on the tax, which is decided by banding.

The Government relies on eight separate property bands to decide how much people pay, which vary by location.

These are the council tax band ranges in England:

Band A: Up to £40,000

Band B: More than £40,000 and up to £52,000

Band C: More than £52,000 and up to £68,000

Band D: More than £68,000 and up to £88,000

Band E: More than £88,000 and up to £120,000

Band F: More than £120,000 and up to £160,000

Band G: More than £160,000 and up to £320,000

Band H: More than £320,000

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How much is the new style Jobseeker’s Allowance?

Due to coronavirus, an estimated 1.3 million workers are out of a job in the UK. The Jobs Retention Scheme, the central pillar of the Government’s attempt to mitigate job losses and businesses going bust is working well, softening the economic blow of the crisis significantly.

Numbers of those claiming benefits has shot up significantly since the crisis began, with young people disproportionately put out of work, whether they have been put on furlough or laid off.

Lengthy periods out of work can have permanent impacts on somebody’s future job prospects, quality of life, mental health and productivity.

Job Seekers Allowance is a short term Government intervention benefit – designed to support you while you look for a new job, or if your current job gives you a low amount of hours.

However, it’s not much – if you are 18 to 24, you get £58.90 a week; those 25 and over get £74.35; and if you claim as a couple you get £116.80 a week to share between you.

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Am I eligible?

If you work less than 16 hours a week, or are unemployed, you can get Jobseeker’s Allowance.

The allowance is a fortnightly payment straight into your bank account.

Jobseeker’s Allowance is a contribution-based benefit – which means to get it you must have been paid or credited with enough National Insurance contributions for the last two tax years.

You must also show you’ve been looking for work between making your claim and going to your interview, however, due to COVID-19, face-to-face benefits appointments are not running currently.

You’ll also need to show you’re looking for work to keep getting payments.

You can also claim Jobseeker’s Allowance if you are on Universal Credit, although this depends on your National Insurance record.

You can only claim the benefit for up to 182 days.

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Does Jobseeker’s Allowance effect other benefits?

Your savings and capital, or your partner’s savings, capital and income, are not taken into account when claiming New Style JSA.

However, your earnings and any payment you are getting from a pension can affect the amount you may receive.

While you receive New Style JSA you’ll be awarded Class One National Insurance credits.

These crucially count towards your State Pension and other contributory benefits in the future.

You can also apply if you have more than £16,000 in savings – you just can’t get Universal Credit with it.

How do I apply?

You can apply for JSA online on the Government’s website or you can call Job Centre Plus on 0800 055 6688.

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Universal Credit UK: How much claimants could receive under benefit rules

The benefit was first introduced in order to foster ease within the benefit system across the UK. It provides claimants with a monthly sum which they can use towards their living costs while in a period of unemployment or low income. New claimants can expect to wait up to five weeks to receive their first payment – although increased pressure on the system because of coronavirus could affect this time. 

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The amount of Universal Credit a person receives can often vary according to personal circumstances.

However, the government has demonstrated its commitment to ensuring those who claim the benefit will get enough.

Within the last month, the Universal Credit figure has been increased twice to help those who are making a claim.

As a result of the lifting of the benefit freeze, Universal Credit was given a boost of 1.7 percent in line with the new 2020/21 tax year.

In addition, to counteract the financial effects of COVID-19, the government also place a £1,000 annual increase on the benefit to help those displaced. 

The sum is likely to work as a financial buffer, at least temporarily, for claimants.

The government has also provided insight into the standard amounts Britons can claim on Universal Credit. 

Single people over the age of 25 could receive £409.89 monthly, with those in a couple where either is over 25 entitled to £594.04 a month. 

However, there are certain circumstances in where the benefit amount can be increased.

Those who have children will get an additional amount, also, to help with increased living costs.

Britons with a child born before April 6, 2017, receive £281.25 per month for their first child, and £235.83 per month for any subsequent children.

Those who had children after this date will receive £235.83 for a first child, and the same amount for subsequent children. 

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People also entitled to a payment increase are those with disabilities or health conditions. 

Dependent on circumstances, these Britons could receive either £341.92 or £128.25 in extra monthly allowance.

Support has also been offered by the government for those who need additional assistance with housing costs. 

The additional payment is aimed at assisting people with their rent and some service charges.

Universal Credit is slowly replacing six legacy benefits Britons may be more used to receiving.

These are: 

  • Child Tax Credit
  • Housing Benefit
  • Income-Related Employment and Support Allowance
  • Income-Based Jobseeker’s Allowance
  • Income Support 
  • Working Tax Credit

The Department for Work and Pensions (DWP) are gradually phasing these benefits out, however, those who claim them will not have to take any action unless instructed to.

Universal Credit can be applied for online, with Britons required to apply as a couple if living with their partner.

Potential claimants must provide their bank details, alongside information about their housing, income and savings.

In order to be eligible to claim, Britons must be resident in the UK, and over 18, but under State Pension age.

The DWP also requires claimants to have less than £16,000 in savings to obtain Universal Credit. 

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Supermarket prices steeply rise during lockdown – millions affected

Supermarkets are often a reliable and quick source to find household items, food and other needs, however there has been a marked increase in price. New research has revealed a price inflation likely to hit the pockets of many Britons who visit these stores regularly. The investigation into supermarket prices showed price inflation had climbed to two percent, which is the highest levels have been since December 2017 – when the level reached 2.4 percent.

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Several Britons used Twitter to express their belief that prices had climbed.

One wrote: “The shopping does seem more expensive from my last jaunt, but I simply put it down to shopping weekly as opposed to every other day.”

Another said: “We have been shopping at our local supermarket and it is definitely more expensive now than before the virus.”

And a third wrote: “Me and my girlfriend had a half an hour conversation last night trying to work out why our weekly shop has jumped up since lockdown!”

The research was revealed in the latest update of The Grocer magazine, which commissioned Edge by Ascential to survey over 62,000 products. 

It also broke down the annual price increases in the ‘Big Four’ supermarkets. 

Tesco prices seemingly increased by 2.6 percent, with Sainsbury’s rising by two percent.

Morrisons prices were tracked to have risen by 1.8 percent, compared to Asda which increased by 1.6 percent. 

This is compared to March, where prices were up at Tesco by 0.9 percent, Sainsbury’s by 0.4 percent and Morrisons by 0.5 percent.

At Asda, in March, prices had only increased by 0.2 percent. 

However, experts stated price rises were a result of a reduction in promotional items.

This seemingly drove up the cost of shopping baskets for Britons across the country. 

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Many Britons have turned to online shopping as a result of the crisis.

At first, supermarket delivery slots were difficult to find, and panic buying ravaged supermarket shop floors.

However, as shoppers adjusted to the lockdown measures the situation seemingly improved.

All supermarkets are still operating under the government guidelines of social distancing. 

Many shoppers are facing queues outside supermarkets in order for the shops to uphold the measures. 

Shoppers and staff members must keep two meters apart at all times. 

And the measures have not only been implemented by shopping giants, as local stores such as Nisa, Spar and Budgens have also adhered to the guidelines. 

Source: Read Full Article

Inheritance Tax UK: How rules can affect amount paid in IHT bill

Inheritance Tax currently stands at a rate of 40 percent, and it is usually not payable on the value of an estate below a certain threshold. This threshold currently stands at £325,000 for most Britons, and the tax is therefore applied to the proportion of any estate exceeding this value. As the tax applies after death to the beneficiaries of those who have passed away, many families are forced to confront the tax earlier than they may have liked. 

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However, there are certain rules which are likely to affect how much beneficiaries pay in Inheritance Tax, and these can come into play long before a loved one dies.

Reducing the value of one’s estate by gift giving is sometimes viewed as a solution to the 40 percent tax.

But there are specific regulations on these gifts which aim to prevent Britons from dodging the tax.

Gifts are counted as anything with value, such as possessions, money and property, however, if they are given away within the seven years before a person dies they will be subject to strict tax rules.

Britons are permitted to give away £3,000 worth of gifts each tax year without them being added to the value of their estate, with small gifts up to £250 also allowed, and presents for birthdays, weddings and Christmas.

However, the seven year rule in place for IHT payers could claw back on gifts after a person dies.

If there is Inheritance Tax to pay, it is charged at 40 percent on gifts given within three years before a person dies.

Any gift given between three to seven years before a person dies is then taxed on a ‘taper relief’ sliding scale.

Gifts given three to four years before death are taxed at 32 percent, reducing to 24 percent at four to five years, and 16 percent at five to six years.

Those given between six to seven years before death are taxed at eight percent, with gifts given seven years or more after death totally tax free.

There are also other ways Britons can avoid paying Inheritance Tax.

Traditionally, there is no IHT to pay if the value of the estate is below £325,000, or if everything above the threshold is left to certain people and organisations.

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These are a spouse, a civil partner, a charity, or a community amateur sports club.

Britons may also be able to increase their Inheritance Tax threshold through a number of measures.

These include giving away a home to children or grandchildren, which can increase a threshold to £500,000.

And if one’s estate is worth less than their threshold, this can be added to their partner’s threshold upon death.

This means a surviving partner’s threshold can climb as high as £1million.

Other, more rare exemptions apply, including for those who own farm, woodlands or businesses. 

Inheritance Tax is paid using the funds from a deceased person’s estate.

The executor of a will, the person who deals with matters relating to the estate, is tasked with keeping in touch with HMRC concerning the matter. 

An all-party parliamentary group is currently lobbying for changes to Inheritance Tax, including the seven year rule, however due to the coronavirus pandemic, these plans are less high on the government’s agenda.

Source: Read Full Article

UK economy won’t bounce back until 2022 warns Land Securities in grim assessment

The grim assessment is more pessimistic than the Bank of England’s take on the crisis. Last week the Bank said it expects the economy to return to its pre-pandemic state next year. The Bank also said the economy is set to be hit by the worst recession in more than 300 years.

However, it is worth noting that policymakers said it was not a forecast.

In the 12 months to March, Land Securities Group Plc wrote down its portfolio by £1.2billion, reports Bloomberg.com.

During this time retail property values slumped.

And on Tuesday the firm, which is the second-largest real estate investment trust by market capitalization in the country, fell by 15.6 percent in London trading.

The performance marked the steepest drop since the Brexit vote was announced in June 2016.

Land Securities incoming CEO Mark Allan said: “It seems prudent to plan for more business failures and higher vacancy rates across our portfolio, in particular leisure and retail.”

Mr Allan is set to lead a strategic review of the company’s long-term objectives over the coming months as the UK slowly emerges from lockdown.

Land Securities said key construction projects has been slowed due to the pandemic.

The building of Deutsche Bank AG’s new headquarters in the City of London has suffered a setback of at least two months.

And touching on the hit the retail sector has taken since the outbreak, Mr Allan said the decline of stores will be accelerated by the pandemic.

High street shops were already suffering due to the rise of online fashion sites.

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Mr Allan told Bloomberg.com there is simply “too much retain property in the UK”.

He said in the coming months the public would see “some of that repurposed”.

He added: “We may see what may have taken five years to play out, play out in the next 12 to 18 months.”

Boris Johnson published his lockdown exit plan on Sunday.

Fashion and homeware stores could potentially reopen their doors as early as June if it is safe to do so.

Non-essential retailers can reopen if they prove the store is a safe place for employees to work and customers to shop.

They must meet a string of new Covid-19 safety and security guidelines.

The Government’s 50-page document laying out its plan says: “Opening non-essential retail when and where it is safe to do so, and subject to those retailers being able to follow the new Covid-19 Secure guidelines.

“The intention is for this to happen in phases from June 1; the government will issue further guidance shortly on the approach that will be taken to phasing, including which businesses will be covered in each phase and the timeframes involved.”

Source: Read Full Article

Warren Buffett’s key tip for making money revealed: ‘It’s easy!’

In an interview with CNBC’s Squawk Box in February 2019, Warren Buffett offered a simple piece of advice to investors looking to repeat his success. He said: “Never invest in a business you cannot understand. “You have to learn how to value businesses and know the ones that are within your circle of competence and the ones that are outside.”

Another tip the billionaire has spoken about is ignoring daily market movements.

Mr Buffett doesn’t pay much attention to the daily ups and downs of the stock market, it was revealed.

In fact, when asked about it during Berkshire Hathaway’s 2008 annual meeting, Mr Buffett said “forget about the word ‘stock.’”

“What we see when we look at the stock market is we see thousands and thousands and thousands of companies priced every day,” he said.

“We ignore 99.9% of what we see, although we run our eyes over them. And then every now and then we see something that looks like it’s attractively priced to us as a business.”

The 89-year-old has also warned of avoiding values traps – when an investor thinks they are getting a stock at a discounted price but in reality, the business has a fundamental flaw that greatly reduces its intrinsic value.

Mr Buffett explained this philosophy in his annual letter to Berkshire Hathaway shareholders as far back as 1989.

“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price,” he wrote.

One piece of advice he has repeated on a number of occasions is to invest in a business or product with the long term in mind, rather than short term punts.

CNBC quoted the Wall Street stalwart as saying: “When we buy a stock, we would be happy with that stock if they told us the market was going to close for a couple of years. We look to the business.

“It’s exactly the same way as if you are going to buy a farm.

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“You would not get a price on it every day and you wouldn’t ask whether the yield was a little above expectations this year or down a little bit. You’d look at what the farm was going to produce over time.”

Finally, Mr Buffett has claimed that investing is actually easier than many believe, but that there is no ‘easy button’.

He said: “You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with the 130 IQ.

“Investors should be skeptical of history-based models. Constructed by a nerdy-sounding priesthood…these models tend to look impressive.

“Too often, though, investors forget to examine the assumptions behind the models. Beware of geeks bearing formulas.”

Source: Read Full Article