Let me say upfront that I probably wouldn’t be writing a post about the Casper mattress on my financial blog if Casper didn’t have an excellent affiliate scheme.

In short, if you buy a mattress from Casper via the links in this article, then you save £50 on the purchase price and they reward me with £50 in Amazon gift vouchers.

There, I said it. Talk about radical transparency, eh?

Don’t click away! Magazines are supported by advertising. Even Which? charges subscription fees. A blogger also has to eat.

Besides, I have plenty to say about this high-quality mattress – and some of it will be very useful if you’re unfamiliar with modern mattress shopping.

I bought the mattress when I had no other furniture in my brand new flat, and it was a godsend. I definitely recommend it.

Here’s why you should read my review before buying this or any other mattress.

Firstly and most importantly – if you do buy via the links in this article then you get £50 off the price of the mattress. So it’s a win-win for both of us.

Secondly, the Casper is the best mattress I’ve ever owned – and probably the best I’ve ever slept on (and I’ve slept in some pretty fancy hotels, especially with work).

Lights out, I zonk out, and I wake without a creak in my body. Perhaps it’s the new mattress smell wafting me away (we’ll get to that later) but I think it’s really the memory foam.

Thirdly, there are almost no reviews on the web from UK-based Casper mattress buyers. All the reviews are American. I live in London, so I thought I might be able to help British buyers make a decision.

Finally, there’s a 100-day money back trial when you buy from Casper. If you buy the mattress and you don’t like it, you can send it back. Hard to argue with a zero-risk proposition like that.

Here’s my in-depth guide as to why the Casper mattress is well worth considering.

What’s so special about the Casper mattress?

I’ll get to what the Casper is made of in a moment. Obviously that’s the most important thing when it comes to sleeping.

But the big difference between the Casper and the last mattress you bought is Casper comes delivered to your house in a box!

Now if you’re thinking how can that possibly work, I hear you. To say I was dubious when I first heard about how the mattress would be mailed to me would be an understatement.

However I spent literally a whole night Googling around and found everyone saying the same thing – the mattress-in-a-box method works, and it works well.

(In a moment I’ll share some photos I took as proof!)

The mattress comes shrink-wrapped in a tightly sealed package. Once you cut open the package and lay the mattress down, it finds its natural shape.

It’s quite uncanny. The mattress isn’t inflatable or anything like that. But it is made of several layers of memory foam. This enables it to quickly return to its proper dimensions.

Unboxing the Casper mattress

Very few people have documented unwrapping their shrink-wrapped mattress.

So here is a quick series of photos showing me unboxing my Casper mattress – you can scroll through them quickly if you don’t like photos:

The box was brought to my bedroom by a friendly delivery man.

A surprise message. Yes, it’s cheesy. Yes, it makes you feel good.

If you’re looking at your mattress at this point and thinking “really?” – I’ve been there brother.

In the instructions it looks a bit like the lady is flapping it like a sheet. Don’t be fooled, this mattress is too well-built and heavy for that. I just lifted the corners a few times to help it along, though there’s no instructions saying you even need to do that.

Freeing the mattress from its wrapper was probably the most fun part of the whole process.

I know… it’s hard to believe that you’re going to get a great night’s sleep from this… thing.

…but you turn your back and suddenly there’s a mattress. Incredible!

Excuse the clutter in the background. These photos were taken in my legitimate New Flat (TM), not at a glossy photo shoot!

The whole unboxing is very simple. These photos and captions probably took you longer to scroll through than it took in reality.

However I have a couple of tips that you may want to read before you unwrap yours – should you decide to buy a Casper via my handy £50-off link I mentioned above.

But first, how is the mattress able to restore itself like that? What’s it made of?

Thanks for all the memory foam

I am not going to spend a lot of time pretending to be an expert on mattress manufacturing.

If you’re anything like me, you just care about: (1) Sleep quality and (2) Whether it’s worth the money?

However it’s worth knowing a few things about how the Casper is made, as this is what leads to the answers (1) “I sleep brilliantly” and (2) “Yes, I believe so.”

The key thing to know is that this is a memory foam mattress. That’s what makes it so comfortable.

However there’s more to a good mattress then simply shipping you a slab of foam.

The mattress needs to be breathable, supportive, and able to conduct heat away so that you don’t overheat in the night.

Casper does this via four layers of foam:

• Top layer – A breathable ‘open cell’ foam layer enables you to sleep cool, and gives the mattress its bounce.

• Second layer – A high-density layer that supports the pressure points of your body.

• Transition layer – This layer apparently boosts the comfort factor by spreading the weight of your body (and any other body you happen to be in bed with…)

• Support layer – The base layer supports the top layers, according to Casper. I think this is just code for “the mattress is not only 2-inches thick” to be honest. It’s the main body of the thing, and what makes the mattress a mattress.

I should also mention the entire mattress is wrapped in the stylish zipped cover that you can see in my photos.

This easily zips undone for removal, and Casper says the cover is easy to clean. (I haven’t tried to clean it – I’ve only had the mattress a couple of months, and I am not inclined to eating pizza in bed or other messy habits!)

For more information on the construction (you thrill-seeker) see Casper’s website.

Sleeping on the Casper mattress: Very comfortable indeed

Here’s the most important thing – the mattress is supremely lovely to sleep on.

I’ve tried to think of a way to tell you about it in words, and perhaps the best way is to explain how I keep failing to find them.

You see, I’ve been planning to finish this review for a week.

Every time I go to bed, I think to myself: “Pay attention! Then you can explain what it feels like to sleep on the Casper in that review you’re finishing up tomorrow.”

And then I wake up! I don’t even remember falling asleep. Bliss.

Obviously not every single night is a great sleep. There are days when I overdo the eating or drinking, or my girlfriend gets up in the night for toast or whatnot.

That’s never good for anyone’s sleep. The Casper is a mattress, not a general anesthetic.

But when I’m going to bed in a fit state, the mattress is like a time machine. I literally just wake up.

It’s that comfortable.

Talking of my girlfriend, the Casper is a great mattress if you share a bed. That’s because unlike some mattresses I’ve slept on, you don’t roll into each other.

You and your bumpy bits (shoulders, hips, and so on) sink slightly into the mattress. There they are supported by the foam.

However this sinking foam only ripples out a couple of inches from your body. It doesn’t reach the other person, which means they can sleep interrupted by your nocturnal movements.

Perhaps the same thing is possible with top-of-the-range spring mattresses that cost £1,000 or more. But in my experience, with springs there’s much more of a dip created by a body, and you can usually feel it as the other person moves.

With the Casper, you’re more like two islands in the same bed. Idyllic!

What about firmness?

Friends have asked me this – what with the Casper being quite new to the UK and them being curious about it (and its arrival in a box…)

It’s hard to answer exactly, because firmness is quite subjective.

I’d say it’s pretty firm. It’s certainly not hard, and it’s definitely not soft, even though your body does sink into the memory foam a little by design.

To me that’s the Goldilock’s scenario – just right! It’s supportive, without being squishy.

But be aware if you do like a rock hard or super-soft mattress (why?) then this might not be the mattress for you.

Of course with the 100-day free trial when you buy, you’ve got the reassurance of knowing that if the mattress does turn out to be too firm or soft for your tastes, Casper will collect it and give you your money back. Can’t ask for more than that.

For a second opinion, I asked my girlfriend for her review of the Casper mattress.

She messaged back:

For me the main thing I really enjoy is the lack of springs, because that’s where I can really feel the difference. The mattress in my flat is old and the springs have spread everywhere, which leads to a night’s sleep akin to being at sea.

I find the Casper firm but not hard – it feels supportive more than anything, although the memory foam does make nighttime a whole lot warmer!

So overall another fan, but let’s dwell on that ‘warmer’ comment. Because I’d say this is my girlfriend’s only complaint with the Casper mattress. She agrees it’s a very comfortable sleep, but she also says it’s sometimes toastier than she’d like compared to my old mattress, or her own bed back at her flat.

I simply don’t have this issue. I agree the Casper is warm, but to me it is snug and cozy warm.

So who is right? Partly it’s down to taste, but here are two further points for context.

Firstly, my new flat has just been completed and meets the highest building regulations. There are no drafts at all, and air only really gets circulated by the trickle vents built into the windows for that very purpose.

In addition there is underfloor heating throughout the flat. The (excessive) five thermostats situated around the flat confirm that unless you leave the backdoor open for half an hour in the middle of the night, the temperature rarely drops below 22-degrees.

In contrast, my girlfriend’s flat has terrible old-fashioned electric heaters. Brrr!

As for my old place, it was 150 years old and drafty. All my bedding came with me from there to the new flat. Arguably I need to get some lighter tog bedding!

Secondly, my girlfriend is one of those infuriating people who sleeps with the duvet wrapped around her nose and an extra share of blanket pulled over from my side of the bed, and who then sometimes says she’s hot.

Really? Maybe don’t wrap yourself up like a mummy?

“I can’t help it, I need all the blankets to get to sleep!” she replies.

As I say, your mileage may vary, especially if you’re rather more rationale about your sleep habits…

My only complaint: The initial ‘new’ smell

Like I said, I find the mattress perfectly warm and perfectly comfortable.

But it’s not quite perfect.

The one niggle in the ointment for me is the new plastic-y smell it comes with.

Now, as someone who has been buying a lot of new furniture lately, I’ve found this comes with everything – sofas, rugs, even tables and chairs.

It’s called ‘off-gassing’ by the professionals. The smell is actually various gasses from the manufacturing process (especially from glue and the like, but really from any artificial substance) being emitted.

Eventually this dies down, and it does too with the Casper.

But of course you don’t normally put your face a pillow-width away from a sofa or a rug for eight hours a night. That does make it more noticeable with a mattress.

The smell is by far at its worst for the first 72 hours. If you can, I suggest you unwrap the mattress in a spare room and open the windows and close the door for a few days. After it’s been aired for a while the smell is much less noticeable.

Don’t get me wrong, it’s perfectly possible to live with it. In fact lots of people seemingly don’t even notice the smell, judging by other Casper testimonies I read when researching buying a mattress.

And my girlfriend had to have the smell pointed out to her for her verdict. She wasn’t really bothered.

In contrast I do tend to be very sensitive to smells. Also as I’ve said my flat is pretty airtight, which probably didn’t help.

But in the interests of full transparency, I do want to flag up this smell as a slight downer. It goes away, but it would be better if it was never there.

The final verdict: Buy a Casper mattress

As is probably very clear, I recommend you get a Casper mattress and treat yourself to a wonderfully relaxing sleep.

Do it via my link and you’ll get £50 off the mattress, too. In addition I’ll be paid some Amazon credits for my trouble!

I’ve recommended the Casper to several friends, and a couple followed up on my suggestion. They are very happy with the mattress – one even wrote to me to say thanks, unprompted!

Recommending the Casper mattress is also a zero-risk proposition thanks to the 100-day money back guarantee. If you don’t like it, you can simply give it back for a full refund. If only all investments came with such great terms.

Buy a Casper and sleep easy. I’m very confident you won’t regret it.

Update: I’ve had the Casper for another two months since writing this review, and if anything I like it even more. I’ve bought a lot of new stuff for my flat. The Casper was among the least hassle to order, it beat my high expectations, and it was great value for money. Remember you get £50 off your own purchase via this affiliate link!

What caught my eye this week.

Long-time Monevator readers all know you cannot avoid risk when investing. Indeed, I try to assume that any investment could – conceivably – fail me.

Does my maudlin mindset lead me to keep all my money in guns and ammo?

Not at all.

Firstly, a prepper arsenal will prove a lousy investment if there’s no societal breakdown / zombie invasion (though some exposure might still have been a good insurance policy, as discussed in a fun article below.)

All investments can fail me, remember? Heck, maybe my gun will jam.

More seriously, assuming failure is possible with everything I invest in or own helps keep me diversified across different holdings and asset classes.

You regularly hear horror stories of people putting all their life savings into some property scheme or ‘guaranteed’ bond or offshore opportunity.

Madness – even when such schemes are not outright scams.

You have been warned

Many of you will be nodding along here. But I’ve discovered one area where quite a few readers think I’m just too paranoid.

Which is that personally I would never run all my money with one fund manager, nor keep all my funds with one broker or platform.

To me, diversifying against the very unlikely case of major company incompetence or fraud is cheap and simple. Even for the strategically laziest passive investors, monitoring two accounts instead of one should only add 30 minutes or so to your annual workload.

Investor compensation under the FSCS is limited to just £50,000 – and that’s assuming you’re even covered.

And while I think the chances of losing money with a huge fund house or one of the biggest platforms is very small, the financial crisis taught me that just not having access to my money is scary.

I wouldn’t whistle contentedly while waiting weeks or months for all my worldly wealth to be recovered in full. I doubt you would, either.

People reply that their assets are legally ring-fenced, so they aren’t too bothered.

Of course I’m well aware of this. However things can and do go wrong, I reply – sounding like an Eeyore.

Well, in the past few months something has and is going wrong, with the demise of a small broker called Beaufort Securities.

As the FT reports [Search result]:

Accountancy firm PwC, which was appointed as administrator by the UK’s Financial Conduct Authority, has faced mounting criticism after it said last week that it could cost as much as £100m to return the cash and assets held by the company, currently valued at £550m, to its thousands of private investor clients.

Some 700 clients with larger portfolios — of more than £150,000 in cash and assets — are expected to bear much of the cost.

“In the absence of any other available resources . . . the overall costs of delivering [returns] to clients has to be shared appropriately by those to whom the assets belong,” said Russell Downs, a joint administrator and partner at PwC, on Wednesday, citing legislation introduced in the wake of the financial crisis.

Repeat: Ring-fenced client money is going to be taken and used, and clients will not get all their money back.

The long-time investor Lord Lee of Trafford has tabled a question in the House of Lords about the basis for PwC’s decision.

Lee told the FT:

“Everyone is of the view — including me — that client funds are ringfenced and protected, and no one can put their hands in and dip into them.”

But PwC has insisted there is a legal and practical case for using clients’ money in the wind-up process.

Repeat: You have been warned

No doubt we can have an informative discussion in the comments about exactly what happened here.

I’m only familiar with what I’ve read in the press, and am far from an expert on the law.

I also expect some will say it couldn’t happen with this or that big fund manager or the platform they frequent (although I’d argue some sophisticated passive investors who chase the lowest fees and express annoyance when anyone makes the case for a big and boring platform could actually be more likely to find themselves on a rickety outfit…)

That said, perhaps people will be more reticent to shout “Never!” now this has happened.

Besides, the specifics of this case aren’t the point. Next time the specifics will be different.

The big reminder is what is important for our purposes: Things fail.

Giant investment banks can’t fail until Lehman Brothers failed. Interest rate can’t go to zero until they did. Company pension schemes were safe until some immoral mogul stuck his fingers in the pot.

Order reigns until a time of crisis, when anything can happen.

Normally we’ll be fine. Virtually always we are.

But not always.

I wouldn’t put all my eggs in any single basket.

• Are you a Beaufort client? Voices on Twitter are urging you to write to your MP.

[continue reading…]

This guest post is by Mark Meldon, an independent financial advisor (and Monevator reader!) who we’ve noticed talking a lot of sense over the years.

With more and more Baby Boomers reaching retirement, I thought I’d mount a defence of the much-maligned annuity as a solution to the question of after-work income.

As an IFA, I have seen a big increase in the number of enquiries from individuals wanting annuities rather than ‘flexi-access drawdown’ this year, and I think I know why.

But first, a little bit of history.

A serious business

…but if you observe, people always live forever when there is an annuity to be paid to them; and she is very stout and healthy, and hardly forty. An annuity is a very serious business; it comes over and over every year, and there is no getting rid of it.

– Jane Austen, Sense and Sensibility (1811)

What Jane Austen said over 200 years ago is still quite true today. Those who purchase a guaranteed income for life via an annuity – whether through using their pension fund to do so or, much more rarely, by spending their own money – tend to enjoy better-than-average health and suspect that they will live for a long time.

Otherwise why would they do it?

They also appreciate something often misunderstood by most of the population – you will live longer than you think, unless you are very unlucky.

Nowadays, even those suffering poor health or making poor lifestyle choices – smoking is an obvious example– can get recognition for their reduced life expectancy with underwritten annuities.

Annuities have been around in one way or another since Roman times and were very popular following the founding of Equitable Life in 1762 and the establishment of hundreds of competitors in the centuries that followed. Even the government sold annuities up until 1928.

Back in the 1970s and 1980s, there were well over a hundred life offices arranging annuities1. Now just a handful remain – we will see why that is a little later!

So, what, exactly, is an annuity?

Upside down life insurance

One way to think about annuities is that they are the reverse of a life assurance policy.

If you buy a life assurance policy you make small regular payments to your life office and, should you unfortunately die during the term, they send you a big cheque.

The reverse is true with an annuity. Here you send the life office a big cheque and they send you little bits of money until the day you die.

Most annuities are fixed in payment, but those that increase by a fixed percentage (‘escalation’) or by reference to the RPI (Retail Prices Index – a measure of inflation) are available and are a sensible choice if you can afford one.

We can see, therefore, that an annuity insures the annuitant against longevity risk, because of the guaranteed lifetime income stream.

You simply don’t get that with any other kind of investment – period.

I have arranged hundreds of annuities over the years, nearly all of them pension-funded ones. I can honestly say that nobody, ever, has been unhappy with the annuity. These individuals were not fazed by the ‘annuity puzzle’.

The annuity puzzle

In recent years, lots of economists have spent a great deal of time wrestling with what they like to call ‘the annuity puzzle’.

This so-called puzzle was first drawn attention to by Franco Modigliani in his Nobel Prize acceptance speech in 1985.

Modigliani said:

“It is a well- known fact that annuity contracts, other than in the form of group insurance through pension systems, are extremely rare. Why this should be so is a subject of considerable current interest. It is still ill-understood.”

What Modigliani said a third of a century ago remains true today.

According to Shlomo Benartzi, Alessandro Previtero, and Richard H. Thaler2:

‘Rational choice theory predicts that households will find annuities attractive at the onset of retirement because they address the risk of outliving one’s income, but in fact, relatively few of those facing retirement choose to annuitize a substantial portion of their wealth.

Adding some behavioural factors only deepens the puzzle because annuities have the potential to solve some complex problems with which individual struggle, like when to retire and how much they can spend each year in retirement, and thus they might be expected to be attractive for that reason as well.’

Benartzi, Previtero, and Thaler go on to say something very important and relevant to today’s ‘at retirement’ sector:

‘In addition to these arguments based on rational choice theory, certain behavioural factors should, in principle, increase the attractiveness of annuities.

As a first approximation, middle-class American households spend what they make. Whatever saving takes place occurs via pensions and paying off home equity, and the latter vehicle seems to have become much less fashionable in the last decade.

If the primary income earner in a household retires, the ‘spend what you make’ rule of thumb is no longer available. Instead, households who choose not to annuitize must learn a new skill, namely calculating the optimal drawdown rate over time.

Given the complexity of this optimization problem, it is not surprising that retirees might err, either by under-or overspending. These errors can easily be exacerbated by self-control problems if households have trouble sticking to their drawdown plans, either by spending too little or too much.

By converting wealth into an annuity, individuals and households can simultaneously answer the conceptually difficult question of figuring out how much consumption is sustainable given the age and wealth of the consumer and provide a monthly income target to help implement the plan.’

I like that – a lot! This is, after all, exactly how ‘defined benefit’ (aka ‘final salary’) pensions and our state pension works – a guaranteed income for life, with some inflation proofing, too.

They can give a ‘baseline income’ covering regular bills, and other pension funds and investments can cover other expenses as they arise.

So why are annuities still so unpopular?

Annuities are not at all sexy. They are also very much a one hit wonder as far as IFA and financial services companies fee-earning ability is concerned.

Nor can they help the reckless squander their capital!

Not so long ago I was at a conference concerned with the ‘at retirement’ market. The speakers produced various tax-planning tips, observations on the state of the investment markets and several technical sales techniques, and how much money they were making ‘managing the Baby Boomers money’. Whilst all this was very impressive in its way, and undoubtedly some of the ideas promulgated might work in certain circumstances, I did find the whole day rather discomforting.

When asked, I said how ridiculous it was that the retired had to spend so much time thinking about their investments, taking and paying for advice, and worrying about the stockmarket. I said I thought that for many it would be much better to cover their financial backsides with a lifetime annuity.

A couple of the presenters seemed to question my views and suggested some naivety on my part.

As I trudged across the rain-swept car park I wondered who was right.

Was it them with their discretionary fund management offerings, index funds managed by algorithms (what?), venture capital trusts and offshore investment bonds? Sure, these things can be useful in certain situations, but they all involve risk, sometimes very substantial risk.

Perhaps my line of thinking about how best to secure my clients a decent amount of worry-free lifetime income with at least some of their wealth is rather old-fashioned, but I remain convinced that it has its place for many people.

A 19^th Century digression

I need to mention here another long-dead novelist, Anthony Trollope, who was writing his Palliser series of novels about 50 years after Jane Austen wrote Sense and Sensibility.

Since the turn of the year, I have been re-reading these great stories at bedtime – I’m about to start Phineas Redux – and something struck me related to my work.

Trollope’s middle and upper-class characters are always banging on about how much money they have, but, in contrast to the IFAs I met at that Exeter conference, their 19^th century fortunes are almost always described in terms of the annual income they produce, not the lump sum.

It seems to me that hardly anybody talks about investments that way now. It’s all about net worth and asset value. I do wonder if asset values have come to play such a big role in modern financial life that we’ve forgotten what those assets are for?

In Trollope’s world, people bought shares purely for the dividend. Now dividends are usually an afterthought, with price appreciation the main goal.

I think that is wrong-headed.

Annuities don’t buy Aston Martin’s

I took a call in my office the other day from a lady seeking help with a pension sharing order following her divorce.

She didn’t appreciate that she won’t be getting a pension when it goes through. She will get an investment account wrapped up in a pension, unlike her ex-husband, who will continue to receive half his indexed-linked final salary pension. This lady was very shocked to learn that she must think about investment, interest rates, longevity statistics and all that kind of thing when her ex doesn’t.

I suspect that she might well choose to annuitise part of her eventual fund in a year or two, as she did understand the guaranteed income for life bit of our discussion.

Yet this lady also helped confirm what I thought was merely an urban myth. A close relative of hers took a transfer out of his employer’s final salary pension scheme just past age 55. He then cashed-in the whole lot – paying away almost half the fund in tax and losing his personal allowance – and blew £160,000 on an Aston Martin DB11.

I said that was completely crazy and she agreed. Apparently, the gentleman enjoys good health, but he sure is going to be income poor when he is 80.

I have no reason to disbelieve this story.

So, what to do when it comes to annuities?

I recommend you think hard about all options when you are nearing retirement and looking at your investment choices:

• Consider annuities very seriously.
• Maybe mix and match annuities with other financial arrangements.
• Conventional annuities are certain! Nothing else is. There are investment linked annuities around, but these are not ‘certain’ in the same way.
• Annuities don’t cost much to arrange. An IFA will charge to search out the best deal and to set one up – but there are no ongoing fees to pay, as far as the annuity purchase itself is concerned.
• Most annuities involve no investment risk.
• If you think you will live forever, an annuity is a great idea.
• If you think you will die soon, think hard about not buying an annuity.
• Final salary pensions are, in practice, annuities.
• So is the state pension.
• You can use ‘flexi-access drawdown’ as the icing on the cake – but remember it isn’t guaranteed and it costs a lot to run.
• You say you don’t want an annuity? But do you really want to be invested when you 90 – or a landlord with a portfolio of buy-to-lets?
• Remember inflation. Even today, with inflation quite low in historical terms, rising prices quickly erode the purchasing power of a fixed income. You can purchase annuities that increase in payment by a fixed percentage – usually with a maximum of 8.5% per annum – or index-linked annuities that are referenced to any increase in the RPI. In many ways, an index-linked annuity would be ideal, but they are very expensive, often reducing the ‘starting’ income compared with a fixed annuity by around 50%.
• If you are worried about dying sooner than average – and thus subsidising those who live longer than average – consider a life assurance policy for your financial dependants
• Don’t arrange a single-life annuity if there is someone else financially dependent on you
• Finally, annuities offer something priceless – peace of mind!

Mark Meldon is an Independent Financial Advisor based in Cheddar, Somerset. If you need an IFA closer to home, try the directory at Unbiased. You can also read Mark’s other articles on Monevator.

1. Source: UK annuity price series, 1957-2002, Edmund Cannon & Ian Tonks, University of Bristol & University of Exeter [↩]
2. Annuitization Puzzles – Journal of Economic Perspectives – Volume 25, Number 4, Fall 2011 [↩]