March 2012 - Page 2 of 3 - Financial Planning in Wimbledon

Critical Illness Claims Beating The Odds

2011: 50/50 – Jonathan Levine

Financial planning involves planning the life you want, but also making sensible provision should life not deliver all that you hoped. Insurance is not something that many of us think of in warm terms, but the truth is that for those without adequate capital the right insurance is as welcome as England winning the world cup (assuming that you are English). Insurance can be a life saver and the UK provides world leading insurance.

Many of you may have taken out critical illness cover at some point in the past, the need for the cover needs to be reviewed regularly – it does become increasingly more expensive. However, every time I have a client that is unfortunate to be diagnosed with a serious illness like cancer, I’m grateful that I advised them to take the cover out. Sadly some people don’t have cover and of course only discover its merit once they are diagnosed with a serious condition and then of course wish that they had some. Unfortunately this happened to someone I know last week. My thoughts are with them as they come to terms with the medical treatment and uncertainty about the future, not to mention the impact on finances and lifestyle.

One company that has been a major player in the Critical Illness market is Scottish Provident. They took over SMA Pegasus many years ago, a company that was one of the pioneers in the market. Anyway, Scottish Provident recently announced that of the claims that they received in 2011, they paid out 91% of them. The average payout was £81,883 with the largest single payment being £945,709. In total they paid out over £89m in claims in 2011 for critical illness. 65% of claims were for cancer (average age 47) – with 33 different types of cancer claims, of which a third were for breast cancer. The next largest set of claims was for heart attack (12% – average age 50) and stroke (6% – average age 47). Importantly of the claims submitted 2% were not paid because Scottish Provident discovered material non-disclosure on the original application form. The remainder (7%) simply did not qualify because the illness suffered did not meet the definition of a critical illness. A quarter of all claims were paid to people between the ages of 45-49 (the largest group of claimants).

The moral of the story is to make sure that if you need critical illness cover it is with a really good company like Scottish Provident and that you provide full disclosure of your medical history within an application form. My role as a financial planner is to help assess if you even need cover, if so how much and then I put on my IFA hat to do the leg work to find the best combination of cover, terms and price – which will be a price that is not inflated with commission, because we charge fees for our work and do not have to sell policies to get paid.

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

Critical Illness Claims Beating The OddsDominic2017-01-06T14:40:07+00:00

Talking Money – Out Now

2012: Talking Money March Edition

Our clients receive a hard copy of our regular magazine “Talking Money”. This time the focus returns to the end of the tax year and making sure that you have made full use of sensible allowances. A digital version of the publication is available via our website, which you can either download simply as a pdf or into i-books or a similar application. You can access the magazine here and we have also added a couple of brief updated guides about Pension Consolidation, Estate Planning and Wealth Management. These can be found within the resources section of our website. Please remember that these are generic and do not contain specific advice, if you are a client please seek our advice before acting on documents like these. If you are not yet a client, please exercise great caution as good financial planning requires a context, which should always be yours, not that of the latest rules and regulations.

The hard copy of Talking Money was sent to clients yesterday, please be aware that time is rapidly running out for the tax year, which for most people means consideration of available pension contributions, ISAs and capital gains allowance that could be used. Feel free to pass on the hard copy to friends or the digital version.

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

Talking Money – Out NowDominic2017-01-06T14:40:07+00:00

Deja Vu Investing and the Sequel of Ker-ching

2003: The Curse of The Black Pearl

As you will have gathered, I’m a financial planner that likes films, probably partly because I enjoy a good story – something that I get to hear from clients (the story of their life to date…in part! but perhaps more interesting is where they plan to take the story in the years to come). Anyway, I was bombarded by more emails about “new investment funds” which frankly all seem to be very much alike, which prompted me to reflect on the sense of “deja vu” that I sometimes also experience with film.

There are probably a wide range of reasons why there are so many sequels in the film world. The worlds highest grossing 50 films contain 40 films that are part of a series – Pirates of the Caribbean, Lord of the Rings, Harry Potter, Indiana Jones, Star Wars, Shrek, Spider-Man, Jurasic Park and believe it or not Transformers to name a few. A cursory glance at a theme park list of rides and you will see this theme further “monetised”. There is very much as sense of finding a “cash cow” and milking it for all you can – or the goose that continues to lay golden eggs. This might be said of the investment world too, where new fund launches become a “me too” bandwagon form of investing. The film world is much like momentum investing – a popular film begins to gather momentum, becoming a global success. Investment Companies also spend considerable sums on marketing to tell us all how fantastic they are in the hope of gaining further momentum. Unlike film though, the ticket price will not be pretty much the same for everyone, those in at the beginning will benefit far more than those towards the end – which has no direct comparison to film, which is essentially a fixed but unique (because of the viewer) experience. Investing once the news is out, is a bit like arriving late at the party, it has happened (largely) the greatest profits have been made and the original investors have probably sold out for a higher profit to an investor that wanted to catch some of the action, all too late. This is the often forgotten key principle for professional investors, like those appearing on Dragons Den.

When it comes to investing, the greatest returns are invariably achieved by the first few investors, this is a high risk strategy that most of us are unlikely and unwilling to risk – after all it could go horribly wrong for a new investment (there is a higher chance). So most tend to wait until the good news is confirmed, by which point the opportunity will have largely passed. This constant chasing of returns and becoming disillusioned tends to cost investors considerable sums, often eroding their asset values. This is one of the reasons why I discourage clients from playing the game – which is unwinnable for most people. There is an alternative though, one that will reduce costs and provide better results. Unlike the films that entertain millions (and make millions – for example, the Pirates of the Caribbean series has taken over $3.7bn in worldwide box office tickets) investing should not be about being taken along for the ride.

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

Deja Vu Investing and the Sequel of Ker-chingDominic2017-01-06T14:40:07+00:00

Cash ISA – time running out for the tax year

1965: The Truth About Spring – Thorpe

As a financial planner that update you about financial products, without bias, here is today’s update about the top rates around for cash accounts. Please check the detail, this is a list to aid searching rather than a list of approved Banks, it is not advice (I’m sure that you have figured this out for yourself by now). Have a look at Moneyfacts for more information and detail and please remember the protection offered by way of the FSCS which is capped at £85,000 per person per Banking Licensed Bank. I have blogged about this before so won’t repeat myself here again.

Instant Access

Online: Coventry Building Society 3.15%

Bank: Virgin Money 2.85%

Building Society: Nottingham 3.25%

One Year Deposit

Online: United National Bank 3.30%

Bank: Santander 4.20%

Building Society: Leeds 3.35%

Two Year Deposit

Online: Nottingham 3.85%

Bank: Halifax 3.70%

Building Society: Progressive 3.75%

Cash ISA Variable Rate

Online: Santander: 4.00%

Bank: Barclays 3.05%

Building Society: Newcastle 3.05%

Cash ISA Fixed Rate

Online: NatWest 4.20%

Bank: Halifax 4.50%

Building Society: Yorkshire 5.00%

As anyone possessing an ounce of wisdom will appreciate, these rate are likely (certain!) to alter. The tax year end is rapidly approaching, which for anyone not using their ISA for long-term wealth creation, the Cash ISA element is available. However, if you are a client, do check with me first. Oh and if you haven’t heard of United National Bank (few in the UK have) it is the product of the merger between United Bank and the National Bank of Pakistan.

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

Cash ISA – time running out for the tax yearDominic2017-01-06T14:40:07+00:00

Good Bank… Bad Bank?

1945: The Lost Weekend – Billy Wilder

The most expensive financial costs are probably your pension, closely followed by a mortgage. So today’s news of further lenders increasing their standard variable rate, despite the Bank of England retaining their base rate at 0.50% will cause many to question the ethics of Banks again. Today, Clydesdale and Yorkshire (readers of this blog will know that they are part of the same organisation) have decided to increase their standard variable rate from 4.59% to 4.95% from 1st May. This will mean increased borrowing costs for about 30,000 of their customers. However there is a slight twist, they also seem to suggest that if you wish to move to a different lender and do so before the end of July any exit fees (early redemption penalties) will be waived. One might question why lenders would be helpful, I would suggest that this is all part of a timed strategy to tidy up a mortgage book and continue to work on improving their own balance sheet.

It often surprises me when I read industry statistics about how few people review their mortgage, yet will seem to get very worked up over the price of petrol – which is an insignificant cost when compared against a mortgage. This is something that as a financial planner I would encourage you to do. Solomon’s do not arrange mortgages, but we can put you in touch with an excellent mortgage broker that can help you. However the first thing you should do is to contact your existing lender to determine what deals they would offer you as an existing customer, once you have this information a full assessment of the market will have some context.

Banks and Building Societies are set up to make money from you and whilst it may appear to be a significant effort to move from one to another, these days things have improved. The market is a competitive one, but most rely on your inertia to make the bulk of their profits, which in turn makes them lazy and makes for a less competitive market. So as you head off for the weekend, get out your mortgage statement and have a look at your rate, compare this against a Bank of England base rate of 0.50% and consider how much over the odds you are really prepared to pay, then consider how you might better use some of this to achieve other goals, even if its just being able to feel a little better at the petrol pumps.

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

Good Bank… Bad Bank?Dominic2017-01-06T14:40:07+00:00

Google it… thinking differently about bricks and mortar

1999: Office Space – Mike Judge

Today I had the opportunity to go beyond the online and see the bricks and mortar of Google. Here in London, right next to Paddington station is an office that attempts to capture the essence of west coast technology and lifestyle. Google it seems, does live up to its online answers for everything when it comes to looking after their staff, the result being that an army of motivated and committed people take the strain, crunch the numbers, run the algorithms, and test the features of all things Google.

The offices are a little like an indoor beach – including deckchairs underneath palm trees, open spaces, help yourself coffee stations (and some) just about a frisbee throw from the last one. Pool tables, games rooms and even a music studio for staff to jam. There is a huge canteen area with a vast array of choices and its actually a free lunch. The environment encourages more of the collaborative work that you might expect from an organisation like Google and of course uses all of the latest technology to communicate internally and around the planet.

My visit prompted me to reflect on how the working environment is also testimony to corporate culture and speaks volumes of the relationship between management and staff. In most British businesses this would be “extreme business” and perhaps for many smaller businesses, simply beyond their reach. However, there are lessons that could be learned – perhaps a thoughtful, creative environment leads to higher productivity and/or increased loyalty, perhaps it leads to better ideas and better business. Our environments have an impact. That made me think that financial advisers can forget that a property is not simply an asset, but a home. The decision to downsize or relocate to somewhere cheaper in order to release funds for income later on, may be far from ideal, yet for many it is a likely scenario. A financial plan will identify options and provide a reality check well in advance of reaching such a stage. A good financial plan will also consider and reflect that your main residence is not simply a bricks and mortar, but a home – one that reflects your values.

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

Google it… thinking differently about bricks and mortarDominic2017-01-06T14:40:07+00:00

Life – Time to Save Some by Getting Involved.

2012: Kony

Financial Planning works when the world that we live in also works. Teenagers and “youth” often get very bad press – yet they are our future. I was sent a link by my teenage daughter to have a look at. This is a powerful video designed to change the dreadful things that are happening at the hand of Joseph Kony a rebel soldier leader in Uganda. This is well worth the 30 minute investment of your time. Have a look, make a difference. The campaign to make Joseph Kony famous is now gathering momentum. He is responsible for the abduction, rape, brutalisation, maiming and murder of over 30,000 children in Uganda, forcing children to become soldiers in his make-shift “army”.

Most of us tend to feel powerless about the state of the world as we read about what is going on, (well I do) whether it is Syria or anywhere else. Here is a compelling short film that will hopefully make you more aware of what’s going on, renew your optimism in a younger generation and American foreign policy. What have we got to lose by getting involved? Perhaps this is too political for a financial planner – but frankly I’m not too bothered. I really only want to work with people that I like and my clients are all people that I believe care about the state of the world. So if I upset anyone for suggesting involvement, that’s a shame, but I’d rather be part of changing the world for the better, however naive that might be, than watch others deliberately ruin life for others. I can live with the consequences.

KONY 2012 from INVISIBLE CHILDREN on Vimeo.

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

Life – Time to Save Some by Getting Involved.Dominic2017-01-06T14:40:07+00:00

Cash ISA – Fixed Rates Rising

1968: The Fixer – Frankenheimer

Here’s a round up of some of the top rates available for cash savings. This is not advice, but a list of rates, I would always encourage you to check the detail carefully, a good website for a full list can be found at moneyfacts.co.uk, please also remember the levels of protection for savings are restricted to £85,000 per banking license (not necessarily per bank).

Instant Access

Online: Santander 3.10%

Bank: Virgin Money 2.85%

Building Society: Nottingham 3.25%

One Year Deposit

Online: First Save 3.40%

Bank: Santander 4.20%

Building Society: 5.00%

Two Year Deposit

Online: First Save 3.80%

Bank: Clydesdale 3.61%

Building Society: Progressive 3.75%

Cash ISA Variable Rate

Online: Santander 4.00%

Bank: Barclays 3.05%

Building Society Newcastle 3.05%

Cash ISA Fixed Rate

Online: NatWest 4.20%

Bank: Halifax 4.50%

Building Society: Barnsley 5.00%

There have been changes in particular to the fixed rates for Cash ISAs, but be warned – many Banks and Building Societies are often dressing an investment as though it were a Cash Deposit. The two are very different.

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

Cash ISA – Fixed Rates RisingDominic2017-01-06T14:40:07+00:00

More Good News for Mining Stocks

1949: Sons of New Mexico – English

Investment in the right mining companies has been fruitful over last few years. Fresnillo, one of the larger mining companies releases its preliminary figures this morning. Profits before tax up 50%, with revenue increasing from $1,409m to $2,192m. Fresnillo is now the world’s largest primary silver producer and Mexico’s second largest gold producer. The production of silver actually fell (marginally by 0.6%) whereas production of gold increased by 21.6%.

Fresnillo is a FTSE listed company and as a result anyone with a UK index tracking fund will hold some stock in the company. If you would like to see the preliminary results click here.

Whilst many of us will remember the Wild West movies which often seemed to revolve around gold from Mexico, today in 2012 the West is still getting gold from Mexico, albeit not at the point of a gun or stolen. Mind you, some might consider the current price of gold to be something akin to daylight robbery.

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

More Good News for Mining StocksDominic2017-01-06T14:40:07+00:00

Tax Year Ending

1995: Nick of Time – John Badham

Financial Planning has a long-range perspective, financial advice is often highly focused on specific tax years. As a financial planner that implements financial plans using financial products, it is important to remind everyone that we now have only a month until the 2011/12 tax year ends. This means that anyone that has not used ISA allowances and wants to do so does not have much time left. The personal Capital Gains Tax Allowance is a “use it or lose it” allowance, so it may be worth considering realising some gains from investments so that the gain is tax free (up tot the CGT allowance). Pension contributions – a “little” more complex, but in essence the annual allowance of £50,000 runs out and to make matters a little more problematic, the Lifetime Allowance is reducing from £1.8m to £1.5m – it is possible for some people to protect the higher amount by applying for HMRC Fixed Protection.

These are just a few of the main allowances, others might include Junior ISAs, personal charitable giving, Potentially Exempt Transfers, Enterprise Investment Schemes and Venture Capital Trusts. The UK has the most complex and most detailed set of tax rules on earth. These are often viewed as a hindrance, but rules are helpful to anyone planning.

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

Tax Year EndingDominic2017-01-06T14:40:07+00:00