November 2010 - Page 2 of 4 - Financial Planning in Wimbledon

Ageing Population

Perhaps it is the fact that my eldest daughhter turns 18 this week (enough to make me feel considerably middle-aged!) but there are some fairly alarming reports doing the rounds about how badly people are planning for their retirement.

Sun Life Financial of Canada conducted a recent survey amongst people aged 60 and regarded as affluent. Only 26% of them felt that they had planned for their retirement in detail. 76% agreed that retirement planning has become more complex even within their own lifestime, with 84% agreeing the issues are more complex than when their parent’s generations retired.

The survey revealed that also half, 48% had little idea about the size of the pension pot that they would need. So in an attempt to provide a “rule of thumb” try this approach.

Take the income you want (before tax) and divide this by 4.5%. This will provide the approximate value of the pension fund you will need IN TODAYS MONEY. Importantly good planning will allow for inflation.

Here’s a worked example. Suppose you are 45 years old and require an income of £60,000 for your retirement before tax. The fund value needs to be £1.3m in todays money. If you plan to retire at 60 then there are 15 years left. If you estimate the rate of inflation to be 3% a year then that’s 15 years of inflation at 3.0% a year.

So the income of £60,000 has become £93,478 and the fund value £2,077,288. The numbers are pretty shocking aren’t they! That’s the power of inflation…. which is something that we all know, but tend to forget…remember that house you bought, the loaf of bread or the last time you bought pretty much anything a reasonable time ago..

We can help work out what you need and how to best get there, using the most suitable solutions given your requirements and attitude towards risk. Give me a call.

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

Ageing PopulationDominic2023-12-01T12:52:38+00:00

Offshore Tax – loopholes closing

Positive news for the Government – reclaimed tax from overseas tax evasion was expected to raise £1bn for the Treasury, but following negotiations between the Government and other national Governments this looks likely to significantly increase.

Mr Osbourne is now expecting an extra £2bn from secret offshore accounts just from Liechtenstein. Its is possible that a further £3bn may be payable from Swiss accounts as well. Some estimates are in the region of £10bn from such tax evading accounts which estimate that there is £125bn stashed away in Swiss accounts by UK citizens.

All of this is helping to reduce the deficit and I imagine that it will be a more prominent part of the Government’s strategy as a political move to reduce the negative criticism that has resulted from the largely middle-class tax penalties to date.

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

Offshore Tax – loopholes closingDominic2023-12-01T12:52:39+00:00

Remembrance Sunday

As we draw to a close on National Ethical Investment Week, it seems fitting that Sunday 14th November will be Sunday Remembrance Day – in as much that war is very costly and should be avoided if at all possible.

As for the financial costs of Defence spending, my latest (and newest) Economist World Figures for 2011 (based at end 2008) reveal that the UK was 23rd in world rankings for Armed forces with 175,000 regulars and 199,000 reserves. Our Armed forces are numerically smaller than (in numerical order)…

China, USA, India, North Korea, Russia, South Korea, Pakistan, Iraq, Iran, Turkey, Egypt, France, Brazil, Syria, Indonesia, Italy, Taiwan, Colombia, Germany, Saudi Arabia, Morocco, Israel and then UK!

In terms of Defence spending as a percentage of GDP, the UK (and China) weren’t in the top 27 (27th South Korea at 2.6%)… the largest? Jordan at 10.6% – however turning the numbers into defence spending the UK was third ($60.8bn) ahead of China’s $60.2bn and surpassed by France $67.2bn and the USA at an enormous $696.3bn.

When these numbers are converted into an equivalent spend per head of the population the UK was 11th at $998 per head. Leading the spend per head was the United Arab Emirates at $2,972 , Kuwait $2,623, USA $2,290, Qatar $2,129, Israel $2,077, Oman $1,410, Saudia Arabia $1,357, Norway $1,264, Australia $1,056, France $1,049 the the UK at $998.

Draw your own conclusions.

As we remember those that fought for our nation so that we might enjoy significant freedoms, you may be interested in an excellent play “Birdsong” directed by Trevor Nunn and written by Sebastian Faulks. Ben Barnes (Prince Caspian/Dorian Gray) is excellent as the leading character Stephen Wraysford and supported by a great ensemble including Nicholas Farrell (Chariots of Fire). Its a fabulous production and very moving, though the end of Act 2 may have you glued to your seat.

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

Remembrance SundayDominic2023-12-01T12:52:39+00:00

Ethical Investing: Myth 4

Myth 4: It’s all or nothing.

Fact: Many modern green and ethical investors choose to”dip a toe in the water” by mixing some green and ethical options with their other investments.

From my perspective, frankly for most investors it simply is not possible to achieve a diversified portfolio (spreading risk) across different asset classes (types of investment) and global markets. In practice the bulk of retail ethical funds are within the UK Equity and Global Specialist sectors. As a result these is not really a “single solution” for a proper portfolio so some compromise ought to be made. Many experts argue that asset allocation adds far more to a portfolio than the selection of the funds – so it does seem somewhat naive to be an “all or nothing” investor when it comes to selecting ethical funds. In the same way that purely selecting UK equities (representing only about 10% of global markets) would seem irrational too.

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

Ethical Investing: Myth 4Dominic2023-12-01T12:52:40+00:00

National Ethical Investment Week

Last night I was at the House of Commons for a parliamentary reception to mark NEIW 2010. UKSIF, the sustainable investment and finance association called upon the Government to introduce a Green ISA allowance at the next Budget in March 2011. New research from YouGov for NEIW reveals that over 12 million British adults (about 27%) would be likely to invest in a Green ISA during the next 12 months. The research also revealed that over half would consider investing in renewable energy to help the sector receive greater funding. This money would help to meet the urgent demand for investment in the green energy and environmental sector.

Government adviser Lord Wei outlined the challenge facing the ethical/green market within financial services and combined this with the challenge of “Big Society”. He was impressive and it was a good opportunity for me to meet some of those involved within the movement to promote better business who have some fantastic ideas about how we can all profit from investment into innovative markets.

I also spent time with Penny Shepherd MBE and UKSIF CEO who has been spearheading the drive to make NEIW into the investment world equivalent of “Fair Trade fortnight” and who spoke on Radio 5 earlier in the day (21 minutes into Wake Up To Money).

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

National Ethical Investment WeekDominic2023-12-01T12:52:41+00:00

Monthly Market Report

This is now available via the website in the news section. Clicke here to view the market statistics

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

Monthly Market ReportDominic2023-12-01T12:52:41+00:00

Ethical Investing: Myth 3

Myth 3: Green and ethical investors are mainly teachers and social workers.

Fact: Financial advisers report a wide range of “non-traditional” clients interested in green and ethical investment today, including young entrepreneurs and those inheriting wealth.

I have to admit I’m not entirely comfortable with wording of the UKSIF myth 3 statement. For starters it seems to imply a slight dig at teachers and social workers which is far too generalist to be accurate. In essence the sentiment is that ethical investment is for everyone, not just those that spend time protesting in boats or climbing onto oil rigs etc.

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

Ethical Investing: Myth 3Dominic2023-12-01T12:52:42+00:00

Funds: Gartmore

Roger Guy the former Fund Manager of the Gartmore European Selected Opportuities Fund has announced that he will retire from Fund Management. The fund is currently managed by John Bennett and remains a AA rated fund.

Fund Fact Sheet here

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

Funds: GartmoreDominic2023-12-01T12:52:42+00:00

Unstoppable… check, check and check again

I occassionally get invited along to previews of films and last night saw “Unstoppable“. Its an “inspired by real events” story about a train that becomes out of control, picking up speed and loaded with toxic cargo. Insert Denzel Washington and Chris Pine (Captain Kirk from the new Star Trek film) with direction by Tony Scott (who seems to have thing for trains) and a dose of railroad bravado and you have a classic format tense action disaster drama. I enjoyed the film but couldn’t help feeling that the in fact this train was very stoppable, had those in charge applied as much effort to thought as their efforts to braking.

The story begins with a catalogue of errors that are so obvious, that an audience is left in no doubt that this will come back to haunt. This is partly about not having a series of checklists, not taking short-cuts and thinking more about the stock price than people. We all make mistakes, and the worst are those that get repeated. So it is vital that we have processes in place that significantly reduce the possibility of error.

This is something that will of course ring true within financial services – how do the brakes get applied? when is your portfolio headed for disaster and how will you know when you are far too close to possible wipe out? This is something that we help clients with – flagging problems, maintaining controls and providing realistic benchmarks. Don’t let your financial mistakes be the most obvious ones.

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

Unstoppable… check, check and check againDominic2023-12-01T12:52:43+00:00

Ethical Investing: Myth 2

Myth 2: Financial performance is sacrificed

Fact: 90% of wealth managers responding to a summer 2009 survey said that their gree and ethical investing portfolios had performed the same as or better than their other portfolios.

(source UKSIF).

My own view – performance might be worse or better than the market, frankly it will depend on the market cycle. Generally speaking ethically screened funds holder “smaller companies” within their fund, these tend to do well in rising markets and poorly when markets are falling. In philosophical terms – one would assume that companies that provide a way for us all to save costs and energy are likely to prosper.

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

Ethical Investing: Myth 2Dominic2023-12-01T12:52:43+00:00