Investment Update

I have updated the data within the guide “Our Approach to Investing“. This now includes the 2010 data which was recently compiled and released by Towers Watson. An interesting note, for the long-term investor, there has not been a single 20 year period where the rolling average returns from equities have been negative in the last 25 sets of 20 years. You’ll need to see the document to get this.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Investment Update2023-12-01T12:49:02+00:00

FUNDS: Jupiter Environmental Income

FUNDS: Jupiter Environmental Income

I have only just been informed that the Jupiter Environmental Income Fund has been renamed as the Jupiter Responsible Income Fund – which actually happened last Monday. Not only is there a name change but also a reclassification of sector, from UK All Companies to UK Equity Income (IMA sectors). Jupiter believe (and presumably the IMA agree) that this is a more appropriate category. The objectives and charges of the fund remain the same.

Interestingly the reclassification has not exactly helped the performance ranking of the fund, which now sits in a group of 70 or so similarly categorised funds. The UK Equity Income sector is defined as “Funds which invest at least 80% in UK equities and which intend to achieve a historic yield on the distributable income in excess of 110% of the FTSE All Share yield at the fund’s year-end.”

The latest data from the IMA for July 2011, shows that the UK All Companies sector has £106,461million under management compared to £55,732million in the UK Equity Income sector – so half as much. The newly named Responsible Income Fund is a fund that some of our ethical investors will be familiar with.

I’m sure that Jupiter are hoping that the current Fund Manager, Chris Watt will be a rising star as he searches for income returns where… well probably quite a few have gone before. Sorry I couldn’t resist the temptation to somehow get in a Star Trek line. Chris Watt, manages the Jupiter with around £35m in the pot, the 2009 Paramount Star Trek film directed by JJ Abrams has recorded gross sales of $385m. So some catching up to do…

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

FUNDS: Jupiter Environmental Income2023-12-01T12:49:03+00:00

The Complexity of Winning

The Complexity Of Winning

I’m often to be found in Richmond Park walking my dog, which at this time of year is more awkward than usual due to the rutting season as stags begin to fight their way to the top of the food chain. This is an amazing spectacle, but one that is also somewhat dangerous and walkers (and dogs) need to be careful as the mood of deer is not that predictable. Certainly antlers can be rather sharp and the prospect of being gored by a stag who just doesn’t like your company is not something to take too lightly. Several people have been injured in the last few days.

All the gesturing reflected so evidently in nature is also witnessed amongst politicians as we are now in the mid-flow of conference season and of course in the combatant world of commerce and high finance, which appears to be finally approaching some form of agreement, though there are concerns that the inevitable problems are merely being pushed further into the future. One would like to think that being human and thoughtful would have meant that there is rather less bullying and fighting to get to the top, indeed a lot more thoughtfulness is required to “win ethically”.

As I dodged the deer and hundreds of cyclists speeding around Richmond Park at the weekend, I was reminded of World Road Cycling Championship in Copenhagen. Britain now has a new World Champion in the form of Mark Cavendish. A man who is now at the top of his sport. To be a World Champion in pretty much anything requires a huge commitment and focus. However spare a thought (as he did) for the other seven British riders that helped him get to the line first. These are all people who presumably train just as hard and bar the last 500 metres, were protecting him and leading him to the front. It takes a different sort of person to put aside their own ambition to help another win and a reminder that playing your part is more important than everyone trying to be the same (world champion). The end of the race was incredible. Have a look at the clip on the BBC Sport website.

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

The Complexity of Winning2023-12-01T12:49:04+00:00

The Best Laid Plans Might Involve An Alternative Or Two

The Best Laid Plans Might Involve An Alternative Or Two

Yesterdays stock market falls are very unwelcome news, but perhaps it will cajole the politicians and bureaucrats into action to address the problems within global economies. As a part of my role, I seek out a range of investment opportunities, besides those simply of shares. Shares (or equities) are obviously volatile but have a proven long-term track record, however there are other forms of investing that can be helpful to those looking to diversify beyond the available cash, bonds, property and equity funds. One such opportunity might be to consider investing in the film industry.

Most people will be aware that there are many films that don’t make it to the big screen – a serious number. This may have little to do with the quality of the film (think of all the dire blockbusters that you have seen over the years) yet every once in a while a “small film” finds massive commercial success. In recent years, from a British perspective this might have included “Slumdog Millionaire” and “The Kings Speech“. These are generally unexpected and very welcome successes. Most of the time, films do not find such international success.

That said, success is a term that can be rather misleading. As an investor what one really wants to achieve is a positive return on capital. Investing in film needs to be done carefully, largely due to the way that films are financed, not the way they are edited. Commercial and financial success hang upon the way a film is distributed and in 2011 this includes DVD, rental, pay-per-view, download and cinema release as well as the possibility of merchandising.

Last night I was doing some research on your behalf at a private screening of “Best Laid Plans” which is produced by Molifilms, whose MD, Mark Foligno also executive produced “The Kings Speech“. The film is one of several that are part of a financing investing opportunity for those with a minimum of £25,000. This would be an investment in an Enterprise Investment Scheme and therefore would qualify for tax relief on the investment of up to 30% (this was increased from 20% in the last Budget but not yet finalised). So a £25,000 investment ought to see £7,500 returned to the investor in tax relief (a net investment of £19,250). In addition, provided the shares are held in the company for 3 years there is no capital gains to pay. Sounding better still. Of course how the EIS is structured, the underlying financing and management of the business (Mark Foligno who has a strong pedigree with considerable success) are all vital elements in assessing whether this is a good investment, let alone an appropriate one.

As for the film itself, it is a pithy, dark tale of a life of grime and crime in Nottingham. In many ways not unlike “One Flew Over The Cuckoos Nest” with one of the main characters having significant learning difficulties – the gentle giant who is taken advantage of my some fairly unsavoury characters. Unlikely to have box office “success” but a movie that many will probably see. The lead actor, Stephen Graham, who recently appeared in “Tinker Tailor Soldier Spy” is particularly good. It is not everyone’s cup of tea, it’s a raw life urban Brit flick.

As an investment – well I’m still conducting my “due diligence” but if this sort of investment appeals to you, then you could have a look at the prospectus yourself, or call me once I have completed my research. This article is in no way advice, merely commentary on the diversity of investments available and the sort of things I get up to seeking out opportunities for clients.

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

The Best Laid Plans Might Involve An Alternative Or Two2023-12-01T12:49:04+00:00

Cash ISAs and the Bank Job

Cash ISAs And The Bank Job?

It is evident that I am in film linking mode (see the movie poster of “The Bank Job” set in 1970’s London and starring Jason Statham, which seems appropriate given the release of “Tinker, Tailor, Soldier, Spy” and a general concern that we may begin to see a return to the 1970’s in many other respects). There were considerably more Banks and Building Societies in the 1970’s than there are now. Anyway, here are some of the current top rates for various deposit accounts. This is not in any way advice. You should always check the detail, less the Bank (or Building Society) pull the proverbial wool over your eyes. A site that I find very helpful is moneyfacts.co.uk which is a fairly decent comparison site for deposit accounts of various shapes and sizes. Be warned that anyone holding a modicum of cash will invariably be solicited by a Bank (or Building Society) to use a “better” account. The key question is – better for whom?

One Year Deposit

Online: Leeds Building Society 3.46%

Bank: Santander 4.20%

Building Society: Barnsley 5.00%

Two Year Deposit

Online: Post Office 3.96%

Bank: Clydesdale 3.82%

Building Society: National Counties 3.76%

Instant Access

Online: Derbyshire 3.18%

Bank: Santander 2.50%

Building Society: Nottingham 3.25%

Fixed Rate Cash ISA

Online: Clydesdale 4.50%

Bank: Clydesdale 4.50%

Building Society: Barnsley 5.00%

Variable Rate Cash ISA

Online: AA 3.05%

Bank: Santander: 4.00%

Building Society: Newcastle 3.00%

So not that much change over the last seven days or so.

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

Cash ISAs and the Bank Job2023-12-01T12:49:05+00:00

Cash ISAs – All You Need To Know

Cash ISA is basically just a deposit account where the interest is paid without being taxed. It won’t be taxed either – provided that it remains in the ISA. A Cash ISA is a great place to park money (as it is not taxed) for those unlikely to use much of the full £10,680 (2011/12) ISA allowance. You can only contribute £5,340 towards a Cash ISA during the 2011/12 tax year. If you take money out of a Cash ISA that’s too bad (in terms of the allowance) – its measured on what you put in, not what you take out.

For example, if you put £3000 into a Cash ISA and withdraw £1,000, you have still used £3,000 of your allowance for the year.

As ISAs are individual and relate to a tax year, you can build up quite a number of them, perhaps with different Banks. This is not a problem, but you can only have one per tax year. So you couldn’t for example put £3000 with Nationwide and £2000 with Halifax during the same tax year (into a Cash ISA).

If your Cash ISA now has a poor rate of interest you can do one of two things. You may for example now have over £20,000 in various Cash ISAs. You could transfer it to another Cash ISA paying a better rate, the important thing is that you do not cash in your Cash ISA in order to move the money to a better Cash ISA – otherwise you are stuck with the same annual allowance of £5,340. In other words if you cash in your £20,000 in Cash ISAs, you lose the ISA status of that money. Moneyfacts.co.uk is a good place to seek out Cash ISA Transfer rates. I suggest doing their search rather than simply viewing their best buy list.

Alternatively, you could transfer a Cash ISA into a stocks and shares ISA, a form would be required for this, but if this would move the entire Cash ISA. If you only wanted to move £2000 or so from a Cash ISA you would be better off simply withdrawing this from your Cash ISA and writing out a cheque. This is an investment and so can (will) rise and fall in value. However, be warned that you cannot reverse this action. It is possible to hold “low risk” funds within a stocks and shares ISA, but technically you cannot hold cash within one. This can be a good option if you do not expect to use or need the funds for the long-term (over 5 years). An investment should provide a higher sum over the long-term as opposed to cash, not always, but in the majority of cases. You would be wise to see my guide called “Our Approach to Investing” for more information on this.

A Stocks and Shares ISA can have the full £10,680 allowance but only £5,340  if you have used any (even £1) of the Cash ISA allowance in the same tax year. Here is a link to the HMRC ISA factsheet.

It is worth noting that if you are not a taxpayer, then your interest on deposit accounts should not be taxed (unless it is so great that you have to). If you don’t earn enough to pay tax then the Bank or Building Society can provide you with an R85 form which means that your interest will be paid gross (untaxed). You are of course personally responsible for ensuring that you pay the right amount of tax under HMRC self assessment rules. I have put lots of links to the HMRC documents, so do use these sources.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results

Call us today or visit our website for more information and to arrange a meeting

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

Cash ISAs – All You Need To Know2023-12-01T12:49:05+00:00

NEST: State Pensions, Hope and the Road to Utopia

Political conferences often seem like an opportunity to spell out a Utopian version of life.  This week, the pensions minister Steve Webb has spoken at a meeting at the LibDem conference. He outlined the Government’s broad intention to remove means testing from the State Pension and provide a pension that would eventually be capped at £140 a week in total (£7,280pa). Some receive a larger State Pension than this now and a few nearer to retirement expect to do so. This is primarily due to the SERPS or S2P element of the State Pension – or even delaying receipt of it. Mr Webb suggested that those entitled to larger State Pensions would retain their benefits, but going forward everyone else should expect the same amount. At the moment, irrespective of your entitlement everyone ends up with a minimum of £135 a week if you have no other (or very little) resources. This is known as pensions credit and is designed to ensure that retired people are not “poor”. It is a means-tested benefit.
This is a planning nightmare for the Bureaucrats – the current State Pension is linked to National Insurance contributions and therefore UK earnings as well as age and gender. The entire system needs to be very carefully unpicked to prevent a “series of unintended consequences”. It is interesting to see that Mr Webb is citing projections that 1 in 6 people alive today in the UK will live to 100 and one in three females born today will live to that age. This is also the main reason for the ambitious and hopeful aspiration of the Universal Credit System that the Coalition are introducing.
Mr Webb also suggested that NEST and its auto enrolment should be unaffected by means-testing – which is something that I blogged about yesterday as a result of further news from the conference. 
The prospect of living until 100 or longer does rather complicate financial planning and your assumptions about the future need to be considered and reviewed in line with your expectations. You may have read that Bob Hope’s wife Delores died on Monday at the age of 102. She had been married to her husband Bob for 69 years. Bob Hope died at the age of 100. Bob Hope once said “You know when you’re getting old when the candles cost more than the cake!”.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
NEST: State Pensions, Hope and the Road to Utopia2023-12-01T12:49:06+00:00

10,000 hits on our Financial Advice blog how do we do it?

We have reached over 10,000 visits to our Solomons IFA blog and we are every proud of it. It’s probably because we have got something to say! This is what our customers have to say about us:
Dominic has been my financial adviser for 7 years. I have found his advice, in the minefield of financial regulation and option, to be invaluable. He has an approachable manner, which allows one to ask the silliest of questions without feeling foolish. He does not talk in jargon and always explains things in a financial language I can understand. And, perhaps above all, he is scrupulously honest. I know that he will give me objective advise that will always be in my interest. I simply could not have asked for a better financial adviser.
Martin Evans September 2011
We have been with Dominic for over 10 years, recommended by my late father. His advice is always clear, straightforward and to the point backed up by obvious in-depth knowledge and research. You feel you are in the hands of an expert – and one who cares!
Jamie and Ruth Lyons July 2011
I want to thank you for your help, advice and very smooth running of my planning, especially in these last few months building up to my retirement. It has been excellent. My only regret is that I wish I had been with you years earlier…
Steve Hepden: July 2011
We have been with Solomon’s for over ten years; Dominic has been an excellent financial advisor. He is good at making you think about your financial priorities over the coming years, and seems to get the balance of portfolios just right. He is easy to talk to, and has an excellent knowledge of a range of financial products. He has always made us feel comfortable with our decisions, and never pushed us to take on more risk than we were happy with. He is reliable and efficient and I would highly recommend Solomon’s and especially Dominic.
Fiona Middleton & Henry Dowson: 2011
We met Dominic and Solomon’s in 2004 when our family finances were in a state of transition, as we had both recently lost parents. We were dealing with paying off a mortgage, receiving inheritances and disposing of family properties. We had a collection of policies acquired piecemeal over the years and Jo was having to negotiate a redundancy package. Seven years on, with Solomon’s help, we have a well-structured portfolio of savings and investments, have become adept at budgeting and have put two children through higher education. We have rationalised pension plans and put a retirement strategy in place. But it’s not all been about saving – we’ve spent money on property development as well as hobbies and holidays, having acquired a better sense of our resources and how we want to use them, both now and in the future.  t’s been immensely helpful to be able to talk about finances with a trustworthy and knowledgeable source, and to place decisions in a wider context than just the nature of financial products.
Jo and Chris Walker – May 2011
We are celebrating by enjoying a nice cup of espresso coffee from aromo coffee – a great place to get your ESE easy serving espresso pods in the UK – another great website designed by Solomons Design.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
10,000 hits on our Financial Advice blog how do we do it?2023-12-01T12:49:06+00:00

NEST: Feathers in a fluster at LibDem conference

Money Marketing report that at the LibDem conference today, there has been a call for those over the age of 50 to be given a one hour consultation about their pension in relation to the new auto-enrolment pension scheme (NEST). It is reported that Lord Oakeshott is concerned about the prospect of yet another pension mis-selling scandal. He has tabled a motion in the House of Lords for all those over 50 to receive an hours consultation. It seems that he is primarily concerned about the best use of money when debt might be repaid or benefits lost if only small sums are going towards a pension.
Lord Oakeshott is of course quite right to be concerned that people use their money wisely, but the main point of NEST was to provide a low cost pension that required little advice and possibly set up by an employer (which includes sole traders). This is not good news for employers or advisers who technically could be caught out advising those on low incomes to save for their retirement, when in practice (and with the advantage of hindsight) it may have been better for such a person to spend their money or clear debt rather than save, if the benefit system means losing benefits which they may have otherwise qualified for. To my mind this merely highlights the mess that our benefit system is in. We should never be in the situation where taking responsibility for your future is penalised.
I would certainly agree that advice about whether to join a pension would be preferable, but precisely who provides this and whether the advice is any good is of course unclear. Attempting to assess a 50 year old’s existing pension planning to date and presumably debt levels, expenses and planned goals does not take an hour as any good financial adviser will know. Perhaps Lord Oakeshott has never met one.
Similarly, Dr Ros Altmann of Saga is concerned that certain people over the age of 50 should not be saving into a pension. She would like to see risk warnings for NEST, as she argues that it is not always appropriate for low paid workers to pay into a pension.
As I hope is clear, I agree with the notion that for some people saving into a pension is not a good idea, if the benefits system remains as it is. If advice is to be provided, qualified and competent advisers should be the ones providing this – which costs money, which is entirely counter-productive to the intention of NEST. If advice is going to be provided and paid for, there are far better alternatives for employers to offer their staff than NEST. It is about time that this matter was properly finalised before it turns into yet another white elephant. We only have a year to go before the first NEST schemes must launch.
If you are old enough to have gone to the cinema to see “The Time Machine” with Rod Taylor which was released in 1960, you are one of those that is being “warned”. A time machine would certainly be of use when it comes to investing, but given that I’m not Doctor Who and don’t know anyone that has the benefit of being a Timelord, though if I may presume – we all need some time M’Lord!
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
NEST: Feathers in a fluster at LibDem conference2023-12-01T12:49:07+00:00

European Lottery – All In The Numbers

You will be familiar with all the doom and gloom surrounding the financial system and in particular the European region. There are a plethora of statistics about each country and I have recently been reviewing data from “The Economist“, the IMF and the World Bank.

One of the basic economic measures of a nation is their GDP – Gross Domestic Product, which broadly means the market value of all goods and services produced by the nation. This is where statisticians have a field day – because bigger means more (by and large). If you have a big population, more is produced – well maybe, maybe not. The biggest populations are found in China (1.33bn) and India (1.18bn) which accounts for about a third (37%) of the planet’s population. However between them they “only” account for about 1/8th of the worlds GDP – though this proportion is rising rapidly. India has a younger population with a median age of 25 – one of the very lowest (15 being the lowest in Niger). None of the top fifty countries (on GDP terms) has a median age below 21.

Over the last 3 years or so, GDP in Europe has generally been falling (comparing different sources of data). The bulk of the growth has come from emerging nations in the Far East / Pacific and South America. This is where my attention has been focused over the same period. These nations have a median age of population of 29.4 against a median of 37.4 for the worst of the top 50 performing nations in the same period.

The data suggests that younger populations (but old enough to be established economies) are rising in their economic productivity and power. The older economies are less productive by comparison. Reading that sentence back to myself, would draw the conclusion – isn’t that obvious?  Here in the UK we have a median age of 39.9 reflecting our ageing population. For the record, France have a median age of 40.1; Spain 40.2, Denmark 40.8, Portugal 41, Greece is 41.6, Switzerland 41.9 Italy 43.3, Germany 44.3 and Japan 44.7. In the US, the median age is 36.6 – lower than Taiwan’s.

I appreciate that one must be careful extrapolating too much from statistics. This is evidenced by the best performing GDP per head of population with Norway, United Arab Emirates, Singapore, USA, Hong Kong and Switzerland all appearing to be rather “superior”. However with the exception of the USA, all have small populations of under 10 million – most being under 5 million.

Perhaps rather than comparing the UK against the world, we should attempt to compare like with like. Those closest to the UK in terms of GDP and population size and age are France and Italy. So perhaps our politicians should choose their words rather more carefully when likening economics to war…. after all there are 4 Chinese for every American and about 25 for every Briton. The balance of power is shifting.

 

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

European Lottery – All In The Numbers2023-12-01T12:49:07+00:00
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