April 2011 - Page 2 of 3 - Financial Planning in Wimbledon

Early Access To Pensions Delayed

At the moment you can access your pension from the age of 55. That is not to say that most people do, but it is possible. This might be particularly helpful for some people as under the current rules it is possible to take the tax free lump sum (25% of the fund) and leave the balance in the pension to grow until it is required as income.

The Government considered motions to grant access to pension funds before 55 but have decided against this for the time being. The thinking being that now is not the right time and that people need encouraging to save not withdraw money from their pensions.

The Financial Secretary said ““The Government is committed to encouraging saving and wants to give individuals greater flexibility in saving for retirement. While early access has some merits, there is insufficient evidence to suggest it would act as an incentive to save more into pensions. We will work with industry to develop workplace saving to supplement pension savings. In addition, we will explore other ways of making pension tax rules simpler and more flexible, for example by making it easier to deal with small pension pots.”

I can understand the Government’s position, but would offer this as a thought. Imagine that you have reasonable funds tied up in a pension pot, you are 52 years old and for whatever reason have managed to get into a position where your debts are such that your home is about to be repossessed. Surely in such circumstances, it would be helpful to have access to the tax free cash so that such debts could be reduced or cleared rather than becoming another repossession statistic. If you were 55 this would be possible, but not at any point beforehand. This seems to be a little nuts. Yes we need to ensure that people do not pillage their pensions so that they then become reliant upon the State, but on occasion, it would seem that the smarter move is the short-term. Context is everything and of course, robbing Peter to pay Paul is not a solution, but the option to create an escape plan seems to me to be entirely reasonable.

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

Early Access To Pensions DelayedDominic2023-12-01T12:51:29+00:00

Best Cash ISA Today

Here are the current top rates from Cash ISAs and short term and instant access deposit accounts. This is only a guide and should be checked before placing funds.

ONE YEAR DEPOSIT
Best Online Halifax BOS 3.35%
Best Bank Halifax BOS 3.35%

Best Building Society Derbyshire 3.20%

TWO YEAR DEPOSIT
Best Online Derbyshire 3.95%
Best Bank Halifax BOS 3.80%
Best Building Society Derbyshire 3.95%

INSTANT ACCESS
Best Online Santander 2.50%
Best Bank Santander 2.50%
Best Building Society 1.26%

FIXED RATE CASH ISA
Best Online Halifax BOS 4.40%
Best Bank Halifax BOS 4.40%
Best Building Society 4.40%

VARIABLE RATE CASH ISA
Best Online Santander 3.30%
Best Bank Santander 3.30%
Best Building Society Newcastle 3.00%

All rates are subject to change without notice. Please check all rates and terms before placing any funds with any of the financial institutions mentioned. “Best” does not mean approval of the institution, but the one offering the “best” rate within each category at the time. This information was compiled from MoneyFacts.

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

Best Cash ISA TodayDominic2023-12-01T12:51:29+00:00

Spring Portfolios – New Asset Allocations

I have been working hard reviewing portfolios and have now updated my guidance and advice on this. The document is now ready for clients in either printed or email versions.

If you are a client and would like me to email you a copy please email me.

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

Spring Portfolios – New Asset AllocationsDominic2023-12-01T12:51:30+00:00

Friends Provident (Friends Life) Pension Fund Closures

Four funds are being withdrawn and closed by Friends Provident (now Friends Life). These will not be available from 10th May 2011 to any new investors, but will close to all in August 2011. The funds are as follows.

FP UK Special Situations

FP M&G UK Select

FP Schroder UK Mid 250

FP UK Index Tracking

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

Friends Provident (Friends Life) Pension Fund ClosuresDominic2023-12-01T12:51:30+00:00

Save the Chequebook – Please Get involved!

You may have read or heard that the days of the cheque are running out – but probably a lot sooner than many people realise. For starters you may have recently had a mailing from your Bank, but like most people put this in a pile of “Bank Stuff”. So in case you didn’t spot the change – from July this year the cheque guarantee system will end. That means that any cheque that you receive no longer has a backed up guarantee by the relevant Bank.

The so-called UK Payment Council also plans to abolish all cheques by 2018. The Treasury Select Committee has now re-opened an inquiry as there has been a reasonable number of concerned citizens that this really is not a good idea.

It is possible that you have not used your chequebook for some time – indeed you may not know where it is! but for some people this is a valuable transaction format. Not every small business offers credit card or point of sale payments (which cost everyone more anyway) and some people do not use or trust the Internet for the security of their financial transactions.

So the case has been re-opened. Those most affected will be those with poor credit records, small businesses and charities. In addition, elderly people tend to rely on their chequebook as their primary method of payment. I would add that whilst much progress has been made for for investments to be made electronically, there is still much to be desired across the investment sector.

Cheques are certainly not fraud or foolproof, but writing out a cheque has a psychological advantage – it provides one last opportunity to ask yourself “am I doing the right thing?” – something that Banks seem to rarely ask themselves.

So what are the UK Payments Council proposing instead to replace cheques – well payment via mobile phone is an option and would you believe it – but a “paper-initiated payment instrument” (I kid you not) – which of course sounds like a cheque, which yet again exposes the complete lunacy that seems rampant within the Banking system.

You can get involved by putting your comments to the Treasury Select Committee by Friday 6th May – just 4 weeks time.

Which? are running a petition

LibDems are too.

You could also get involved by pushing this post around your peers and friends.

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

Save the Chequebook – Please Get involved!Dominic2023-12-01T12:51:31+00:00

Easter Break in London

The majority of our clients live and work in the London area. The tourist season is starting to gather momentum and of course there is a big do at Buckingham Palace later this month. London offers a huge range of great things to see and do, but remains one of the most expensive cities in the world. You may be interested to learn of the “Days Out Guide” a website that provides fairly significant discounts to many of the attractions. Just a thought.

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

Easter Break in LondonDominic2023-12-01T12:51:32+00:00

Panning for Gold or Gold for a Panning?

1925: The Gold Rush – Charlie Chaplin

The financial pages are becoming awash with the news that Glencore is set to float on the London stock exchange. The floatation qualifies for fast-tracking and is expected to burst into the FTSE100 in early May. The company which is owned entirely by its managers and employees, had a turnover of $145bn in 2010. Its main activities are the production and marketing of commodities. Glencore are selling off something like 20% of their own shares. It is estimated that this “floatation” means that the company is worth in the region of $60bn. There’s about $11bn worth of the company up for grabs when it floats, that’s about £6.7bn making it the largest floatation in UK history.

Whatever you read over the coming days remember that a market exists to serve both buyers and sellers. The sale of £6.7bn of shares will make several of the key staff billionaires. A key question that is prompted then is “have commodity prices peaked? – hence the sell off?”

A word of caution – those that really made money in the American gold rush of the 1840’s were the ones selling the shovels. Remember that I’m not a stockbroker, so cannot and do not give advice about individual shares. So please do not call me to ask for an opinion on buying Glencore. What I can tell you is that it will end up in most portfolios by default due to fund managers simply having to hold the stock.

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

Panning for Gold or Gold for a Panning?Dominic2023-12-01T12:51:32+00:00

Best Cash ISA Rates – Today

I wonder if this would be a useful feature for you? I have selected the top rate from three categories – Online account, high street Bank and Building Society.

1 YEAR DEPOSIT ACCOUNT
Best Online – FirstSave 3.50%
Best Bank – Halifax BOS 3.35%
Best Building Society – Nationwide 3.50%

2 YEAR DEPOSIT ACCOUNT

Best Online – Aldermore 3.96%
Best Bank – Halifax BOS 3.80%
Best Building Society – Cheshire 3.95%

INSTANT ACCESS ACCOUNT
Best Online – Nationwide 3.05%
Best Bank – Santander 2.50%
Best Building Society – Nottingham 3.25%

FIXED RATE CASH ISA
Best Online – Skipton 4.50%
Best Bank – Halifax BOS 4.40%
Best Building Society Skipton 4.50%

VARIABLE RATE CASH ISA
Best Online – AA 3.35%
Best Bank – Santander 4.00%
Best Building Society – Derbyshire 3.15%

All rates are subject to change without notice. Please check all rates and terms before placing any funds with any of the financial institutions mentioned. “Best” does not mean approval of the institution, but the one offering the “best” rate within each category at the time. This information was compiled from MoneyFacts.

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

Best Cash ISA Rates – TodayDominic2023-12-01T12:51:33+00:00

Business Updates

Forth Ports, the BAA of shipping in Scotland – indeed the largest port owner in Scotland, has accepted a takeover offer from its largest shareholder, an investment company Arcus Partners, who are buying Forth through the Arcus European Infrastructure Fund 1 for a magnate sized £760m.

It has been a poor start to the new financial year for Allied Irish Bank who posted a loss of £9bn in their preliminary results for 2010. The credit rating agencies, which, let’s face it, are not exactly covered in glory have downgraded AIB and placed the Bank on a negative watch list. At the end of last month, following the completion of stress tests on the bank (Prudential Capital Assessment Review or PCAR) the bank was required to raise a further 9.2bnEuros in addition to the 4.2bn deferred from February. That’s a lot of money and as we all know Ireland has some difficult economic decisions to make, having a bank repair its balance sheet rather than lending money to business is unlikely to help.

This is set in contrast to the Italian bank, Banca Monte dei Paschi di Siena, Italy’s third largest bank, who are raising £2.22bn of capital in preparation for their stress test, this resulted in credit agency Standard & Poor’s upgrading the bank’s credit rating. So not only is the bank set in one of Europe’s most beautiful cities, it is also attracting the right attention, by taking proactive measures.

Staying in Italy, Fiat yesterday announced that they are increasing its stake in the Chrysler Group from 25% to 30%. You may recall that the American car manufacturer based in Detroit filed for Chapter 11(Bankruptcy in English) in June 2009. Fiat was offered a deal for a stake in the company, which could rise to 51% if financial targets are achieved, although this can only happen once the US Government has been fully repaid. Fiat’s increased stake is good news for the United Auto Workers Voluntary Employee Beneficiary Association who have a 60% holding, the US Government owns 8% and the Canadian Government the balance of 2%. Fiat will sell Chrysler cars under its own Fiat badge in Europe and Brazil.

This leads neatly onto the news that the Brazil is benefitting from its relationship with the Chinese, its largest trading partner and foreign investor (one to watch for emerging market funds). Chinese Airlines have placed orders for 20 planes, plus an option to buy 15 more aircraft, in a deal worth £861m with Embraer, (who really are “for the journey”) the Brazilian aircraft manufacturer.

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

Business UpdatesDominic2023-12-01T12:51:33+00:00

New Year Tax Blues?

The new tax year has now nearly completed its first week. David Pointer from the Open Tax Consultancy highlights some key changes. Over to David:

For many people this year will be harder than most with a number of key changes to the tax, national insurance and benefits system all of which are designed to cut the deficit.

Tax Changes

Whilst the main rate of income tax remains unchanged at 20% the most notable changes will perhaps be the alterations to the thresholds at which income at the basic rate and higher rate begins to bite. The Institute for Fiscal Studies (IFS) suggests that 500,000 people will stop paying income tax altogether because the personal tax allowance has risen to £7,475, those with income below this should be better off. On the flip side the IFS also suggests that as many as 750,000 people will become higher rate taxpayers, this is because the income threshold for higher rate tax has dropped from £37,401 to £35,001.

Better news is in store for businesses with the lower rate of corporation tax being reduced from 21% to 20% and the main rate reducing from 28% to 26%.

National Insurance

National Insurance is on the rise too, employees will see a rate increase from 11% to 12%.

Pension contributions

The third change in as many years results in a new reduced limits applying to pension contributions, with the annual allowance now at £50,000 instead of the previous limit of £255,000.

Better news is the fact that contributions can attract tax relief at as much as 50% up to the new £50,000 limit with the possibility to carry forward unused relief from the previous three tax years.

Savings

The tax free Individual Savings Account limit has risen to £10,680 from £10,200 and half can be saved in cash. In the future, the limit will rise each April in line with the RPI measure of inflation. Following from the success of ISA’s Junior ISAs will be available from the autumn to all UK resident children aged under 18 who do not have a Child Trust Fund.

David: “this is the second material phase of tax increases that people will have to take on board this year. The VAT increase in January appears to have had a noticeable effect on spending with people tightening their belt buckles. With take home pay now reducing for many it will be interesting to see how this second set of changes goes down”. He also added “So the New Year may well see a more forced set of resolutions with lighter pockets rather than willpower driving economies across the UK”

Time will tell, let’s hope we and the country will be better for it. We will certainly be thinner, but wiser I am not so sure!

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

New Year Tax Blues?Dominic2023-12-01T12:51:34+00:00