WHY YOU REALLY DON’T WANT A FAKE GUCCI

TODAY’S BLOG

WHY YOU REALLY DON’T WANT A FAKE GUCCI

I imagine you have been around long enough to know the name of fashion house Gucci; you are likely to have come across the occasional Gucci store in one of our big cities or at an airport, the familiar logo and green/burgundy stripes. I very much doubt that your first experience of Gucci is a poster for the new film by Ridley Scott, who once again proves an inability for editing a film under 2 hours, which is a little amusing when there isn’t a single stitch or fabric cut in the film either.

Anyway, I did not know the story of Gucci (sorry) and to be plain, I am not sure I do now. The Romans were responsible for many myths and yet it appears that successful families in Italia (and elsewhere) continue to ignore all the warnings about families, legacy and wealth.

Despite its length, I enjoyed the telling of a family determined to self-destruct, failing to communicate about anything important, all the while offering the appearance of family unity. The hills of Rome, Tuscany or Milan are insufficient to bury the deeply seated gripes that one branch has against the other. Like lonely Jupiter, judging from on high, nursing grievances about the trivial yet punishing with wrath.

No Fake Gucci

THE OBSESSION WITH CONTROL

It often all boils down to control. We are all probably tempted to believe that we have rather more control over things than we really do. Money corrupts most people, not everyone. I would suggest that it is more likely to corrupt those that seek to control (or power).

I believe that there is very little in life that we can control. I say this as a planner, presumably yours. Hopefully you have heard me say something like this before. I cannot control the markets (nobody really thinks that I can) I cannot control the future and I certainly cannot control who is elected and the policies that are introduced. We can all agree on this. Yet the truth is we cannot control very much of anything. We can try, we can plan, we can prepare, we can repeat, learn, gain experience but I cannot even really control how my body reacts or functions. I know its not popular to say so, but that doesn’t make it untrue.

Acknowledging how little I can actually control has been a lifelong journey for me, one that I suspect and hope is far from over. Obviously within a financial planning context we have “controls” and monitor these, responding appropriately based upon accumulated experience. Truthfully, we control costs as far as possible (I cannot control what others charge). We control asset allocation within a comfortable range. We control our own output, but not entirely devoid of externalities that dictate a degree of what makes up “advice”.

CATWALK VALUES

To my mind, we focus on what is important and attempt to encourage our clients to do the same – whatever “important” means to you. In the main, the common themes are relationships and a self-identity, not yachts, grand gestures or bank balances. Yet we cannot control relationships either, at least, not in any healthy way. The uncomfortable truth is that it has something to do with letting go. Something our clients have to sit with on occasion, letting go of control, trusting our advice and processes to ultimately come good. This is always easier to do when things are going well and tested when they do not.

Sadly, the Gucci family, at least in the film-story, forgot all that was important. The fake Gucci bags being a metaphor for their own lives. Quality comes from crafted time, not short-cuts. I’d suggest that the things that are truly important to you are products of time, probably many, many years.

The House of Gucci is streaming at a platform to your living room. The makeup is certainly impressive. Here is the trailer, the film stars Lady Gaga, Adam Driver, Al Pacino, Jeremy Irons, Salma Hayek and Jared Leto.

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

WHY YOU REALLY DON’T WANT A FAKE GUCCI2022-03-16T17:33:09+00:00

HIGHER OR LOWER?

TODAY’S BLOG

BY WHAT MEASURE?

I am conscious that whatever we measure, it never really captures “life”. 2021 has been a good year for our clients and the business. We have taken on new clients, helped reduced debt and costs, improved asset allocations, interest from deposit rates, used tax allowances and reliefs. Some have been reassured of their retirement plans, others have brought forward theirs. We have moved you out of expensive arrangements, ring-fenced funds, protected families and businesses and reduced hassle. Markets have risen (this is not our doing) so valuations are up.

Yet these are reductive measurements. Many of us have had significant difficulty coping with pandemic life, the isolation and inability to do many of the things that we assumed normal. Family members, friends, colleagues have suffered with health, frightening diagnoses, and some, sadly life itself. Some have been furloughed, lost their business or job, those of you working within the NHS or teach have been under tremendous pressure. So yes, returns have been up, but few of us believe that this is the measure of life.

HIGHER OR LOWER

HIGHER OR LOWER? PLAY THE HAND YOU HAVE

Knowing this, every time this year we bear witness to the folly of making predictions. My in-box will be full of “Our Expectations For The Coming Year” or “What Portfolios Should Look Like For This Year”. As we take the long-term (decades) approach I can generally dismiss this as unhelpful noise, designed to evoke anxiety than allay fear. I’m reminded of the 1980s TV Show “Play Your Cards Right” where Bruce Forsyth would reveal cards to players simply shouting “higher” or “lower” than the value of the one previously. Often, I find myself wondering if the investment world is really any better – after all, its meant to be about deploying capital so that good businesses can innovate, improve and expand the goods or services that they provide.

Yet we will see headlines and bylines all attempting to generate anxiety, here are a few that I am expecting.

  • Are Markets About to Collapse?
  • Has the property market overheated?
  • Is cryptocurrency your sure bet to financial freedom?
  • Is the Bond market about to bomb?
  • Will the crisis in (fill in the blank) impact your portfolio?
  • Billions wiped off markets
  • Top Funds for (insert year)
  • Pension storm warning: tax relief is likely to change in the Budget
  • Chancellor plans to scrap (insert point of pain).

I don’t know how this new year will work out for each of us. Some of the above may happen, it may not, the Negative Event World Service (NEWS) wll certainly attempt to stoke anxiety and we can rely on something else always tempting the promise of “better”. I can safely say that we will age, taxes will become due and health, love and friendship are things to cherish and work on. None of us are immortal.

Thank you for paying some attention this year, you are a much better audience than last year. We will continue to call you to look up and look ahead, whilst being aware of the past and context of the present. To be blunt, let us worry about the noise, focus on what you are good at and what you get value from.

Welcome 2022 – we go again.

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

HIGHER OR LOWER?2021-12-31T08:34:23+00:00

BROWN PAPER PACKAGES

TODAY’S BLOG

BROWN PAPER PACKAGES…

It’s that time of year when the parcels arrive in brown paper packages, tied up with strings and yes I’m sorry I cannot help but fill in “these are a few of my favourite things” such is the embedding of “The Sound of Music” in my psyche having raised a family that love musicals and Julie Andrews in particular!

I was struck by something I saw online – “Is there anything more saccharine than The Sound of Music”. Red flag, hold the phone, don’t overreact! I know musicals aren’t to everyone’s liking, and yes, it’s not Tolstoy, it is the Hollywood version of a true story, so some sugar and spice (or lack of) are part of the package. I didn’t think it was quite “fair”. This is after all, a story about the repressed being oppressed and finding a way to liberate themselves in more ways than simply crossing the alps to Switzerland, but perhaps I should try to see the other point of view.

It did get me thinking about the actual story, which is a little more real-life gritty. So perhaps a bit more background is necessary.  Firstly, Georg Von Trapp (31) married his first wife Agathe Whitehead (20) on 14 January 1911.  Agathe was the daughter of Robert Whitehead a highly successful engineer who designed the Whitehead torpedo. Her mother was part of the Austro-Hungarian nobility and the assassination of Archduke Franz Ferdinand and outbreak of war resulted in the family assets being frozen and forbidden from leaving the country. Georg was a naval officer having followed his family vocation that had resulted in elevation through the social ranks to nobility. He became an early submariner commanding the SM U-5 and was decorated for the sinking of various British, French, Italian and Greek vessels. Their first child Rupert was born in November 1911, over the next 10 years they had six further children. As we live with covid, 100 years ago scarlet fever was much more common and in Christmas 1921 five of the children suffered from scarlet fever during an epidemic, including Agathe who eventually died as a result at the age of just 31 in 1922.

The Sound of Music (1965)

HOW DO YOU SOLVE A PROBLEM LIKE MARIA?

In 1926 Von Trapp hired a novice from the local Abbey in Salzburg, Maria Kutschera. Maria’s own mother died when she was 2 and her father left her with his cousin to care for her whilst he travelled the world to manage his grief and died when she was 9. Despite a difficult childhood she completed school with good grades and eventually received a scholarship to the State Teacher’s College in Vienna from which she graduated in 1923. At age 19 she entered Nonnberg Abbey intending to become a nun.

Within a few months of her position at the von Trapp home, Georg asked her to marry him and according to Maria she returned to the Abbey to seek advice from the abbess. They married in November 2027, Georg being 25 years older unlike Julie Andrews who was just 6 years younger than Christopher Plummer (unusual for Hollywood). Maria wrote that she was really marrying the children, that she wanted to be a nun, she liked Georg but did not love him. They had their first of three children in 1929.

FINANCIAL RUIN

The Whitehead family wealth was largely held in England, but by 1935 with growing tensions in the now land-locked Austria from a hostile Germany, Georg transferred the savings into an Austrian Bank which unfortunately collapsed, resulting in the loss of most of the family fortune. The family had to discharge most of their servants and lived on the top floor of their home whilst renting rooms to others.

One tenant was a newly graduated young catholic priest, Franz Wasner who taught the children music. German soprano Lotte Lehmann heard them sing and suggested they perform paid concerts with Wasner as musical Director. Germany took over Austria in 1938 and Georg was offered a commission in the German Navy, he declined and it is also alleged that he declined an invitation for the family to sing at Hitler’s birthday. Later that year the family left Austria by train initially to Italy and headed for the US via London. They returned for a singing tour of Europe in 1939 avoiding the Third Reich but by September made their way back to the safety of the US, where they lived for the remainder of their lives. Georg died in May 1947 from lung cancer. Maria eventually died in March 1987.

On reflection, perhaps The Sound of Music is rather saccharine, by comparison to the difficulties that the von Trapp family experienced. The basic skeleton of story is there, but many of the traumatic, life shaping experiences are glossed over. What is interesting from a financial planning perspective is how quickly fortunes can alter. Within no more than two decades the Von Trapp’s had lost their wealth, their status, their home, their country. They took on a new vocation, touring as a family singing group.

CLIMB EVERY MOUNTAIN

Unlike the Von Trapp family, with good financial planning, assuming that your lifestyle doesn’t become significantly more elaborate than it is, we work together to ensure that funds survive you and that you provide a legacy for those you wish to. Whilst we can never know the future (fortunately) we can prepare for it as well as possible, doing our best.

One of the main advantages of a global stock market is the ability to diversify assets around the world, reducing risk of permanent loss considerably. Your portfolio now has between 16,000 and 30,000 securities – that’s an enormous amount of diversification around the world.

Anyway, as the year draws to a close, perhaps Julie Andrews will be on screen again. Wherever you are this Christmastime I do hope that you receive some packages, some perhaps in brown paper tied up with string.

So long, farewell…

The Sound of Music (1965) Directed by Robert Wise

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

BROWN PAPER PACKAGES2021-12-17T11:55:24+00:00

IS YOUR COUNCIL TAX BILL RIGHT?

TODAY’S BLOG

IS YOUR COUNCIL TAX BILL RIGHT?

The average Band D council tax set by local authorities for 2021/22 will be £1,898 an increase of £81 or 4.4%. The total Council Tax requirement for the year is a whopping £34.4bn – billion! An increase of 1.3billion.

If you believe your property is in the wrong band, you can challenge it through the Valuation Office Agency to get your property revalued and moved into a different, cheaper band. There are some criteria you have to meet, so you’ll need to have some concrete evidence for your challenge to be successful.

For example, if there have been changes to your property that would make it less valuable than the original valuation – part has been demolished, or it is a house that has subsequently been converted into flats. Or there may have been a change to the property or local area that would have changed the valuation of the property, such as roadworks that have been built that would have affected the rateable value of the property.

Council Tax

TWO SIDES OF A NEIGHBOURHOUD

If there have been changes to your property that would make it less valuable than the original valuation – part has been demolished, or it is a house that has subsequently been converted into flats. Or there may have been a change to the property or local area that would have changed the valuation of the property, such as roadworks that have been built that would have affected the rateable value of the property.

You can also get your band changed if mistakes have been made when the rating was carried out. If your council tax band has been incorrectly calculated, not only will you enjoy lower bills, but you’ll get the money back that you had overpaid, all the way back to when you started paying the wrong amount. If you’ve been in your property for a couple of decades, this could be a big chunk.

But beware – challenging your council tax band can deliver bad news as well as good – you could end up increasing your council tax bill by the agency deciding that you should be in a higher band. This could even affect your neighbours, with the potential to make you quite unpopular down your street. That planned street party for the end of the pandemic, may create a few awkward moments.

Here’s a link to the Council Tax site.

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

IS YOUR COUNCIL TAX BILL RIGHT?2021-09-20T17:41:26+01:00

DON’T YOU FORGET ABOUT ME – A TALE OF A SIMPLE MIND

TODAY’S BLOG

DON’T YOU FORGET ABOUT ME – A TALE OF A SIMPLE MIND

Reminders on my phone are a necessity. This singular function is one that I use to organise my life, attempt to not forget to do things, and often be in the right places at the right times. I truly believe that I would be lost without this very simple tool. However…

Setting yourself reminders is a very manual process – you create them, set the date on which whatever the task is must be completed. Most crucially, it is all too easy to change the due date on these reminders and push them back over what is, inevitably, a multiple-month stretch. If this process were automatic and unchangeable to prevent procrastination (which over the years I have come to believe is something of an art-form) I am sure that I would achieve more, all within a much more reasonable time span. We are creatures of habit, however, the discipline required in the early stages of forming GOOD habits is crucial in maintaining them for the longer term. This got me thinking about automated finances, which is a concept that I have been hearing and reading about a lot during my studies.

AUTOMATE AS MUCH AS POSSIBLE

Andy Hart, in his excellent podcast ‘Maven Money’ which I would highly recommend, states that automating your finances is one of the most important things that you can do. This means setting up standing orders or direct debits (whichever is more appropriate for the scenario), in order to ensure that your money goes to the places that you want and need it to go. One of the main focuses of this technique is saving, whether this be for a house, other large projects or emergency funds, though the same technique can be used to help yourself in many other ways – desired monthly pension contributions, for example, is another goal that this technique could be used for.

Not only will you never forget to make these savings/contributions ever again, but you are likely to become even better at budgeting for all other aspects of your lifestyle without these funds even coming into consideration – with the comfort of knowing that these funds have contributed towards achieving your financial goals and strengthening your financial plan.

MONTHLY SAVINGS HAS SOME OTHER ADVANTAGES

Some of you may have already seen our short video that explains pound-cost averaging. In a very clear way, this video explains how there can be a great benefit to making contributions to investments on a monthly basis, essentially meaning that you will always end up paying the average price over a particular period of time rather than being at risk of paying over the odds.

It’s ironic how we often forget the things worth remembering but remember the things worth forgetting. I have included our video above about monthly budgeting and setting up your bank accounts, to help make this entire process much easier.

Daniel Liddicott
Trainee Financial Adviser

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 Dominic 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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

DON’T YOU FORGET ABOUT ME – A TALE OF A SIMPLE MIND2021-07-26T10:16:07+01:00

NEW YEAR, SAME OLD PROBLEMS

TODAY’S BLOG

NEW YEAR, SAME OLD PROBLEMS?

The year finally draws to a close, thoughts turn to resolutions for 2021. Perhaps thinking 12 days ahead is easier than 12 months. Yet we all hope that the vaccine will be rapidly and successfully deployed so that we can pick ourselves up and face a new year, with some degree of reduced anxiety.

This may take a while and so can I urge to you complete your 10 Minute Challenge items. If you really cannot bring yourself to tick off these important tasks, can I ask you to simply jot down on a piece of paper your plans for 2021. Then send it to me as an email (preferably placing it on the portal).

HAPPY NEW YEAR

FORGET THE RESOLUTIONS – MAKE IT EASY

I am not interested in resolutions. Most of us find these rather like hopeful pie-crust promises – easily made, easily broken. No I am after some of the practical goals and tasks that you want to get done this year, things that I can have input into or help with… so that’s things like (and of course any such list it not exhaustive and needs adapting to your circumstances).

  • Your bank balance – rates are awful, but what is your comfort cash balance?
  • Your monthly savings level (how much you want to squirrel away each month)
  • When you intend to retire
  • If you are retired, what challenge are you facing in 2021?
  • What income you need
  • Clearing or reducing your mortgage
  • Your job or career – any changes to work patterns, promotions, redundancy concerns?
  • Expectations for your business or perhaps starting one (or another one)
  • Where you live – any plans to make alterations to anything that requires finance?
  • Any big purchases? Electric car? Alternative energy?
  • How you will measure 2021 as a successful year.

You will appreciate that some of our clients work in the NHS, we also advise a few teachers. Most of us will have some time to note down some thoughts. PLEASE send these to me. This is precisely what proper financial planning is all about – where your life, values and money all meet. You may think your plans are not terribly ambitious or hanging on the hopes of “normal life resuming”. I offer no judgement, simply want to know so that we can do an even better job for you in 2021.

Enjoy New Year’s Eve and the zoom calls with your friends and family. We will be ready to go again on Tuesday and I look forward to it.

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

NEW YEAR, SAME OLD PROBLEMS2020-12-30T16:36:43+00:00

TOMORROW’S WORLD

TODAY’S BLOG

PLANNING A FUTURE

The more I read or hear about the impact of the pandemic on real people I am reminded of how important it is to have a sense of the future. There is little doubt that many of us have been struggling with the practicalities of living detached from friends and family, or frankly anyone that we may not know, but form a part of our ordinary lives.

Monty Don made the point that having something to look forward to is ever so important, which is part of the reason why so many people love and enjoy gardening. Those of us with gardens have benefitted this year from fairly good weather and the ability to take more time to enjoy our open spaces. Many have remarked that during the Spring when were in the full lockdown phase, they observed the natural world in way that seemed to be a glimpse into a bygone time, of no cars or aeroplanes – to see and hear nature, as may have been observed centuries ago.

TOMORROW’S WORLD

You will probably remember the BBC1 programme “Tomorrow’s World”. It was something of a TV fixture for many people, irrespective of age. When I grew up there were only three TV channels and “Children’s television” officially ended just before the news, but programmes really didn’t stop appealing to children. Perhaps you will remember James Burke, Michael Rodd, William Woollard, Judith Hann and Maggie Philbin all explaining various inventions which would perhaps become commonplace lifestyle improving solutions. Many of the “predictions” turned out to be some way off the reality, others were quite clearly an early prototype.

Anyhow, it got me wondering about the importance of having a vision for the future. We have seen some welcome reassessment of the past, we cannot change it, but we can at least learn to understand it differently, specifically its impact on the present.

SOLOMONS IFA - TOMORROW'S WORLD

A PLACE IN TIME

Without a grasp of history and a hope for the future, I would argue that it is easier to become overwhelmed by the present. Today I could probably find shows like Tomorrow’s World, but I’d really have to hunt them down from not simply hundreds of channels but different media sources and they certainly would not be what the majority watched, all experiencing the occasion at the same time, which I also believe to be pertinent to our sense of time.

THE IMPORTANCE OF HOPE

The book of Proverbs has an interesting phrase “without vision the people perish”. That’s a pretty bold statement and of course, has been interpreted in all sorts of ways and probably used to justify all sorts of ideas. If I may, can I simply offer it as an acknowledgement of the value of having a sense of tomorrow. Having hope.

Many of us, (perhaps all of us) have had moments of despair at the current circumstances. Whether that is concern about health, family, friends, loneliness, financial pressure, worrying if your business (or your friend’s) will survive, if you will ever get to enjoy the things you did before… Then there is a very deep despair that overwhelms and leads to some believing that they have no future and so end the pain.

DON’T UNDERVALUE YOUR FUTURE

The future is something I discuss all the time with clients, but I have to admit that simply having a sense of a future itself (whatever that looks like) is rather more important than having no vision at all. Please get in touch if you need to talk or simply want me to listen. Perhaps your plans have altered, maybe some priorities have changed. Alternatively, maybe you know someone that I may be able to help to get their plan for their future into shape.

And for your amusement… here’s the team at Tomorrow’s World looking back at the 1970s as the new decade was about to begin from roughly 4 decades ago – which is typically how long people “work” for a living and increasingly how long retirement may last…

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

TOMORROW’S WORLD2020-10-15T12:35:40+01:00

HOT PROPERTY?

TODAY’S BLOG

HOT PROPERTY – WHAT YOU NEED TO KNOW

We are all aware that the world is a bit weird now.  The thoughtful self-reflection that occurred during lockdown appears to have given way to fatigue, thoughtlessness and sometimes an attitude of selfishness. The UK property market continues to confound reason.

We know that during the initial lockdown, which was really the duration of the second quarter of 2020, very little happened, then gradually restrictions have lifted. One of the often-cited reflections of working from home is the need for a quiet space at home, be that a spare bedroom, study or garden shed. As people became accustomed to not commuting, many found that they are in fact rather more productive. Some have found a better balance between the professional and the personal. Many have questioned why they are paying for an expensive small home that makes commuting quicker but now find it unnecessary. Some have noted the value of community and the desire to be closer to relatives. Space is cheaper elsewhere.

We know that big cities like London were struggling to encourage people back into the office, leading to an existential threat to many supporting businesses and organisations, from cafes and restaurants to meeting venues. We are now heading into the Winter with yet another Governmental set of directives, which may or may not be helpful.

Interest rates have never been lower in living memory. If ever there was a time to borrow it is now. However, lenders are all too familiar with bad debt and worry about an economy that may experience a prolonged recession, with rising unemployment and job insecurity. The usual domino effect of recessions. This results in lenders managing their own risk, limiting who, when and why they lend. They hold the cards. We may all find money a bit tighter if taxes increase to pay for furlough and various Covid bailouts.

SOLOMONS IFA MONEY FOCUS

STAMP DUTY: GOING, GOING…

The Chancellor has tried to stimulate house sales by removing Stamp Duty on sales under £500,000 until the end of March 2021. This is a tax break that is planned to end. Some of you may remember MIRAS, another tax break which ended 20 years ago. House sales in England typically account for 85% of all house sales in the UK, forgive me, but I’m going to focus on the sales in England. The ONS records sales over £40,000. In Q2 of 2020 a provisional 131,730 homes were sold in England, a year earlier the figure was 237,870. Sales had been gradually improving since the credit crunch. Numbers had not recovered to their 2006/07 which saw 1,433,200 homes sold, that collapsed in 08/09 to just 664,250. Sales have been recovering slowly and then dented again by the Brexit vote, before reaching 1,003,060 in 18/19.

SCORES ON THE DOORS…

2020 began fairly slowly, but reflective of seasonal normality with monthly sales in the 70,000 range. April sales collapsed to 32,350 (lockdown) but by July sales had returned to winter levels of 71,190. So despite what Estate Agents may be telling you, property sales are below average, down by something like 20%. You can dress it up, but that’s the reality of completed sales. That said, according to Nationwide average prices recovered in July and increased in August by 3.7%. They also note that the 2010s has been the weakest decade for property prices up 33% over the decade compared to 180% in the 1980s. Low interest rates and the credit crunch being the suggested main factors.

YOU HAVE MORE MONEY? LET ME SHOW YOU…

Some warn that the reduced stamp duty tax will not be passed on, as sellers push prices to cover their own stamp duty on property over £500,000. In short, the young are paying above the odds. Some expect prices to fall as demand slows in April next year when the stamp duty break ends. Then there is Brexit, which is now a sub-heading of the national conscience, but it would appear that the Government have little real idea if agreement can be reached.

This might prompt a reduction in prices (nobody knows) which tends to happen when a tax advantage ends and a recession is happening. So those thinking of buying this autumn or winter that are looking at property priced under £500,000 face the increased risk of buying at a peak value and a collapse. They have to counter this with the benefit of stamp duty savings. A property valued at say £400,000 currently has no stamp duty, from April such a sale price would result in £10,000 of Stamp Duty. That said, £10,000 is only 2.5% of the purchase price (£400,000) it would not be inconceivable to see prices fall by 15% (£60,000 in our example). This may wipe out your deposit and possibly mean that you have negative equity.

THE THING IS – WE DO FORGET

Turning to relatively recent property crashes, the 1990s provided some of the harshest lessons for homebuyers. The worst decade for price rises – even London only increased by 40%. Some of you may remember MIRAS, which was tax relief given to borrowers. Nigel Lawson changed the terms of MIRAS so that unmarried couples could not claim it from August 1988. He announced the changes in April 1998 which provided 4 months of “opportunity” which pushed up prices to bubbling point. When the relief was lost repayments went up. The overpriced market peaked in 1989 with an average price in London of £97,667 but then fell back to £66,573 by the end of 1992. A fall of £31,094 or more importantly 31%. When inflation is factored in, prices didn’t really recover from 1988 until 2001.

A decade later (April 1998) MIRAS was again reduced to the point of being almost worthless and finally abolished by Gordon Brown two years later in 2000. Its been 20 years since MIRAS ended. There has been some tinkering with Stamp Duty which was altered from a flat rate system to a tiered rate system from December 2014. This was done in an attempt to curb price rises particularly in London. In Q4 of 2014 the average national price was £189,002 by Q2 2020 it was £220,133 (up 16%). In London the average price was £406,730 and is now £475,448 (also up 16%). So the gap has not widened, but equally it has not shrunk (so the strategy neither worked not “failed” but it certainly didn’t change anything). The numbers are certainly larger and London remains the most expensive part of the UK.

IF IT WORKS, IT WOULD BE UNUSUAL

So over the last 32 years tax changes to residential property has created a quick spike and then collapse in prices (1988-1992) and it has also effectively done nothing (2014-2020). Chancellor Rishi Sunak would be making a little history if his policy didn’t fail or do nothing of substance.

If history were to repeat itself, which let’s face it, tends to happen more as an echo than a direct repetition, then there is the prospect of a 31% fall (88-92). That would mean someone buying in 2020 for £400,000 would potentially be contemplating their home revalued at £276,000. It could be a decade before prices recover.

We have short-term memories and forget what has happened. First time buyers have no memory of a property crash, (indeed some of my detractors on social media appear to have no memory at all). Lenders are currently very reluctant to lend more than 90% and many will struggle to get a competitive loan with more than an 85% mortgage. So with our £400,000 example, that’s a deposit of £60,000 and if a third gets wiped off by 2022, the £340,000 mortgage would be higher than the value of the property (£276,000) for some time…

FORECASTS ARE NOT MY THING

The truth is we simply do not know what will happen. We do know that Brexit will happen (we do don’t we?). We know that we are in a recession. When recessions happen, jobs are lost, money is tight, homes get repossessed (1991 was the peak for repossessions). We know that interest rates are at all time lows which implies only one likely direction for the cost of borrowing (upwards). So would you buy to save £10,000 on stamp duty before March or would you wait a couple of years and either buy the same property for 30% less or simply buy a bigger place.

IN SHORT- BE PREPARED TO LIVE WITH YOUR DECISIONS

This is a gamble, I have no idea what will happen, perhaps property price rises will return to 1980s levels, but that would likely mean inflation is out of control and interest rates could be much higher than they are now (which I think is unlikely). I do not know – nobody does. We are due a correction – any sensible person knows that property in the South East is overpriced. The only consolation I can offer is that if buying, make sure you do so knowing the above and that you might be stuck for a decade. Fine if you are a young couple in a flat, but not that great if you start to have a family. Lose your job or your relationship falls apart. Perhaps “nothing” will happen. I do not know, but I’m not sure I’d bet my house on it.

SOLOMONS IFA UK AVERAGE PROPERTY PRICES 74-20

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

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Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

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Take Survey

HOT PROPERTY?2020-11-01T08:43:43+00:00

KODACHROME

TODAY’S BLOG

KODACHROME

We’ve all probably watched more on television in the last 6 months than perhaps we have for many years. The other night I watched Kodachrome. I had reasonable hopes given the cast (Ed Harris, Jason Sudeikis, Elizabeth Olsen) and the plot, which was suggested as a father and son trip to get some final film developed at the last place to offer the service before closing. A sense of the now or never.

Famous photographer Ben Ryder (Harris) is at deaths door, much like his Kodak film slides. His relationship with his son Matt (Sudeikis) is also “mostly dead” rather like Kodak. At a crossroads or cul-de-sac (you decide) the two are reunited through contrived circumstance, on a journey together for different reasons. Ben to get 4 old rolls of film developed and Matt to get an interview, both with the air of desperate “last chance” about them.

SOLOMONS IFA - KODACHROME

NOT IN FOCUS

There are lots of possibilities for this, how change, endings and loss are handled for example. If you knew you had a few weeks to live, how would you conduct yourself in your final days. Perhaps a question many of us may have thought about more than usual recently. How do we handle ageing and the constant advancement of technology that can leave us behind, perhaps feeling (or being) redundant and consigned to history. How will we leave our mark, impression or do we even want to?

Sadly, the script and plot failed to cope with difficulty or nuance.  The film is seemingly at a loss for ideas. Perhaps I am wrong, but there is a point in the story where Matt returns to his Uncle’s adoptive home, where Matt lived from age 13 following the death of his mother and the chosen absence of his father. Matt is now an adult in the music business, something of an expert. Yet the room he returns to in his uncle’s home is as it was left – vinyl and posters intact. Whilst I imagine this may happen sometimes, it seems improbable that an adolescent’s room is left for well over a decade (well over) in its original state.

DEPTH

Unsurprisingly, the plot becomes ever more simplistic and lacks any depth of vision (ironic for a photographer). Words are said, tantrums had, departures, threats, ultimatums but we all know where this is headed – a “just in time” redemptive ending, where a man’s work is validated above his ability to be present or available to that which he suggests is important.

Life is rarely like this. We often do not get ample warning to adequately address painful experiences. No final road trip with a mission. The voice of the financial planner is to act as a reminder that life is brief. We all know it is, but most of us live as though it will last forever. Planning finances to last and to be sufficient, so that you can squeeze all the joy you want from your allotted time, whatever that means for you. It has a connection with money, but it is not about money. Its about the choices we make to live.

USE BY: SEE END

So, let me suggest something else. You have 4 rolls of film, (unlike digital images which are so instant and numerous that there is little focus on the importance of the subject and its composition). One roll for each quarter of your remaining time (I would not be so harsh as to divide it up into quarters and give you what should be left). At the end of each future quarter period, I take one from you. What have you filled it with? Even this is clearly a daft suggestion – we simply do not know how much time we have. What we do know is what is important to each of us. The job of the planner is to help you maximise the time you have available and help you calculate what is possible given the resources you have. Like Kodachrome, we all have a shelf-life, this life is to be used. Unlike the food in your fridge, we simply do not have the use by date. This is a reminder check your stock and plan. We all know how disappointing waste is, particularly when at one point it was within our control. Today is your day of control.

SOLOMONS IFA - THE LIFE YOU SHOOT

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

KODACHROME2020-09-28T17:37:05+01:00

TWENTY-ONE

TODAY’S BLOG

TWENTY-ONE

We have turned twenty-one. We are still here and growing again as I outlined in my last post. One of the many aspects of my work that I really love is the constant learning and improving. Whilst learning new things often seems a little frightening, a little bit of time and perhaps a lot of work can  provide a reassuring perspective.

It is tempting at anniversaries to do a lot of looking back at what has been achieved. However today I was introduced to a fairly stark image – no, not the usual pictures of backtracking ministers or inept politicians – a reminder that life is very, very short.

TEMPUS FUGIT – OUR CONSTANT

The author, Tim Urban (really?) continues to use and develop his basic visual tool to explore other ideas, but these all stem from the same basic idea of measuring life in different types of units, rather than perhaps monetary ones. A good financial planner will have discussed this notion to some extent with you – trying to help you appreciate that life is short and you may not get to do all the things you say you would like to do because time runs out. This is fundamental to any good financial plan in terms of knowing how much is enough. I’m not meaning “just enough” but enough.

The graphic shows a human life to age 90. For many humans, this will be longer than they actually live, for some it will not be nearly long enough. Tim spends time reflecting on things he does with his time and then tries to estimate how much he has done and how much he has left. It helps him to focus on what is important to him.

I wonder what you think? Its easy to get started with your own life in weeks, but its also rather daunting when you see how much time remains… hopefully. So I’m likely to adapt this idea to help you think about what’s actually important in your life and what you definitely don’t want to run out of time for. Anyway, the place to start is where you are now… and then cross out everything before or mark it as completed…. I’m available to discuss.

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

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk 
Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

Email – info@solomonsifa.co.uk    Call – 020 8542 8084

7 QUESTIONS, NO WAFFLE

Are we a good fit for you?

Take Survey

TWENTY-ONE2020-08-19T16:53:32+01:00
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