ENERGY COST CRISIS

TODAY’S BLOG

ENERGY COST CRISIS

It seems that there is a weekly crisis at present, by the time you read this there will likely be a new one! I wonder if you are bracing yourself for an expensive winter? As you probably know, there is a global surge in the cost of gas at wholesale has led many companies to drastically increase their prices. While many companies have reacted by hiking up costs even more for customers, others have taken themselves off price comparison websites and some have gone bust. Its worth mentioning that price comparison websites aren’t all that you may imagine, they are not whole of market and only show companies that provide them with a commission.

Anyway your household and mine are facing much higher gas bills this winter due to a global surge in wholesale gas prices that have forced some energy companies to go bust. The British public has already been hit with energy price hikes over the last few months and could be paying hundreds more this winter, unless they counterbalance the extra costs by making some simple changes to their usage. The news that another five energy firms have folded in recent months will no doubt worry many householders but Ofgem has said it “has systems in place to look after consumers”. An Ofgem spokesman said that currently wholesale gas prices are at a record high, driven by international supply and demand factors. This is undoubtedly putting pressure on companies – with four leaving the market over the last few weeks. In the past few months Utility Point, People’s Energy, PfP Energy, MoneyPlus Energy and Hub Energy have all ceased trading – something which is thought to have affected half a million British households.  More recently Green and AVRO Energy both collapsed with an estimated 800,000 customers between them – Octopus has stepped in to takeover.

Energy Crisis 2021

FULL OF GAS

These consumers will be given a new supplier, that means extra hassle for them with the costs passed onto customers. Speaking from personal experience, my supplier “Green Energy Network” went bust last year and we were switched over to EDF. An unfortunately timed problem with the meter itself during this period, left us in limbo as we waited for a new account to be registered and set up, which too several weeks. We finally got there and it wasnt a major problem, but it wasnt “straight-forward”.

OFGEM added that it is working closely with the Government to manage the wider implications of the global gas price increase and it is not thought that this will lead to a complete halt in supply. Make of that what you will, I’m yet to be convinced that the current Government could successfuly manage a raffle.

As such there is no better time to see if you qualify for the Warm Home Discount Scheme, which could ensure some people are £140 better off. To find out, people can speak to their energy supplier, most of them are signed up to the scheme if they have 250,000 customers or more. More than two million UK households should qualify for this rebate on their energy bills this year and it’s important to get in touch with them early as there is only a limited amount of people energy companies can help.

What I might suggest is that you get on with reviewing your gas supply. I would recommend having a look at Martin Lewis’ website www.moneysavingexpert.com where you can do a search. If you want a £50 discount off Octopus, here is a code that you can use (I get £50 too) but do your own research about what is best for your usage. Here is the link: https://share.octopus.energy/tulip-shark-521.

Long story short, make a record and update your spending plan – either just let us know with an email, or update your information within our secure portal.

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

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ENERGY COST CRISIS2021-09-30T16:49:40+01:00

CASH IN HAND?

TODAY’S BLOG

CASH IN HAND?

At this stage, I am hopeful that the pandemic is drawing to a close, but aware that there are still potential problems and concerning infection rates. As many of us have been tucked away out of harm’s way, you may have had little use for your cash, making most of your purchases online or using contactless payments.

As we all gradually find our winter coats, perhaps there is a crumpled £20 note in a pocket, or better still £50. Well, take this winter as your last reminder that the old £20 and £50 notes are due to be “worthless” from 30 September… next year!

You really have the usual options of spending or depositing them, but leaving the old £20 or £50 in a wallet will soon be an expensive receipt.

New Polymer £20
New Polymer £50

MONEY GOES AROUND

There are approximately £9 billion worth of paper £20 and £15 billion worth of paper £50 notes still in circulation. As they are returned to the Bank of England, these are being replaced with the new polymer £20 notes featuring J.M.W. Turner, and polymer £50 notes featuring Alan Turing. After 30 September 2022, the new polymer notes will be the only ones with legal tender status.

After 30 September 2022 people with a UK bank account will still be able to deposit withdrawn notes into their account. Some Post Offices may also accept withdrawn notes as payment for goods and services or as a deposit to an account accessed via them.

The Bank of England will continue to exchange all withdrawn notes. For more information on this please see their Exchanging Old Banknotes page.

Speaking ahead of the date, the Bank of England’s Chief Cashier Sarah John said “In recent years we have been changing our banknotes from paper to polymer because this makes them more difficult to counterfeit, and means they are more durable. The polymer £20 featuring the artist J.M.W. Turner, and the polymer £50 featuring the scientist Alan Turing are now in wide circulation, and we are in the process of withdrawing their paper equivalents. So we want to remind the public that they have one year from today to spend their paper banknotes.”

The new polymer £20 was first issued on 20 February 2020, and the polymer £50 note was first issued on 23 June 2021. You may not have even seen one yet! These notes complete the Bank of England’s first polymer series. The introduction of polymer banknotes allows for a new generation of security features which make them even harder to counterfeit. The notes are also resistant to dirt and moisture and so remain in better condition for longer. These notes also have tactile features that allow the blind and partially sighted to use them.

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

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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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The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

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CASH IN HAND?2021-09-30T16:25:23+01:00

THE CHERRY TREE

TODAY’S BLOG

THE CHERRY TREE

I think it is a Chinese proverb that ask:

When is the best time to plant a cherry tree? Ten Years ago.

When is the second best time to plant a cherry tree? Now

I love proverbs (and old adages … and frankly the odd cliché or two!), but I have often struggled with this particular one.

In my spectacularly naive early twenties, I supposed the proverb to be all about starting young and getting on with it; having goals and taking steps to achieve my objectives and ambitions.  And throughout my twenties I worked incredibly hard at ‘living this truth’.

Following the arrival of my son in my mid-twenties, my career nose-dived; before my beautiful boy was even six months old, I was made redundant. Self-employment followed before taking on a job I loathed (but stuck at for 12 months before acknowledging defeat) and finally ending in a short period of unemployment.

I learned some pretty tough lessons the hard way during those years.  I also learned some pretty awesome things about myself too – that I was up for the challenge; that I was resilient; that I was resourceful – and most importantly that I could reinvent myself and simply start over.

I could plant a cherry tree…

Proverbs to live by

CONSCIOUS THOUGHTFULNESS

It wasn’t so much about the fact that I would have to wait 10 years to taste its fruit; it was that I had actively and consciously with thoughtfulness and determination, set in motion a chain of events that I would relish, savour and enjoy over the coming years (it’s about the journey as much as the destination – well … I did warn you that I like a cliché!).

To me this proverb (as with most of them) means more than just one thing – it can have different meanings for different people and even different meanings for the same person over time.  The cherry tree proverb addresses procrastination, regret, hindsight, patience, a long-term mindset … but most importantly it makes a clear declaration that it is never too late to start!

NEVER TOO LATE

We had the honour recently of welcoming some new clients to the Solomon’s community who were well into their retirement, but recognised that they wanted to plant their cherry tree and it didn’t matter that they may or may not be around to see it bear fruit – just knowing that it will is enough.

We would always encourage people to get financial planning as ‘early’ as possible – so long as ‘leaving it late’ doesn’t become ‘leaving it’.  I will leave you with a final thought – financial planning is not the cherry tree itself – financial planning is the soil …

Debbie Harris
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

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The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

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Call – 020 8542 8084

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THE CHERRY TREE2021-08-05T08:50:12+01:00

AS SAFE AS HOUSES…

TODAY’S BLOG

AS SAFE AS HOUSES

I am not really sure what the reason is, but most people trust their own bank. I guess that a degree of trust has to be there in order for you to agree to bank with them. However, there is a huge amount of inertia when it comes to banking. I don’t know if it is still the case but not so long ago a bank customer was more likely to leave their marriage than the leave the bank.

On 8 July 2021 the regulator concluded yet another investigation and disciplinary action against the Bank with the horse (again). This is prone to jokes about stable doors and a few about the long face. This time house insurance sales. Those awkward hassle reminder letters that tell you its time to renew.

I’m stretching a little, but I am basing my own assumptions on the statements made by the FCA. Long story short, loyal customers were not getting deals they thought were good and there was never any real attempt to compare just how wonderful the cost of insurance was against others. This all happened a few years ago… back in 2017 the home insurance market of 18 million policies and 12.29% of those with Lloyds Bank General Insurance. I make that about 2.2m policies. The premiums paid to Lloyds amounted to a tidy £713m… so that’s an average premium of about £336.

LONG FACE ABOUT FINE

BOLTING THE STABLE DOOR

In fairness to Lloyds they have already repaid customers £13.5m. The FCA have fined Lloyds £90,688,400 due to the misleading renewal and marketing literature, of which there were over 9m “renewal communications” between January 2009 and November 2017. So the problem went on for 8 years and its nearly 5 years after period concerned that a fine has been issued. There really is something about stables, horses and bolting here isn’t there?

Is it just me or is this about 2.2m polices sold each year since 2009… 12 years of premiums or about £8,556m for a £90m fine. It’s about 1% of premiums over those 12 years. Fair enough I am extrapolating the data, but I doubt its far off.

May I make a suggestion? Do not use your Bank for your insurance, or indeed anything other than banking. We see this sort of stuff on a regular basis, yet people remain loyal to their Banks. Use an insurance broker who will assess the market. I use Richard Hiscox at 1Stop. The main advantage is that price competition is part of the issue, the other is whether claims themselves ever get paid out easily with minimal fuss. This experience is something most of us have little of (thankfully) but an insurance broker sees this stuff every single week.

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

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AS SAFE AS HOUSES…2021-07-09T18:04:28+01:00

THE JOURNEY TO TRUST

TODAY’S BLOG

THE JOURNEY TO TRUST

I don’t remember where I heard it, learned it or read it, but a phrase that has stuck with me for a very long time is “trust is earned”. Throughout the course of a normal week, month or year I meet with various new potential clients. Sadly, many people have had a pretty bad experience of financial services, either directly themselves or through pieced together information from someone significant in their lives.

I was reminded this morning of this and how trust is something that evolves over time by keeping promises, often not the big things, but the little things – replying to a call, being clear about expectations, costs and so on.

I have a large black and white picture in the waiting area of the office. It is a still from the 1953 movie Roman Holiday. You will probably know it, starring Audrey Hepburn, Gregory Peck and Eddie Albert. As a reminder, it’s the tale of a Princess called Ann, (Hepburn) who escapes her royal duties and meets up, unwittingly with two reporters, Joe Bradley (Peck) and Irving Radovich (Albert) who know precisely who she is and have the prospect of a career-making scoop on their hands. After a night on the town (and who wouldn’t in Rome!) being a romantic comedy, the princess naturally falls for Bradley, but is he simply using his charms to get what he wants?

ROMAN HOLIDAY - JOURNEY TO TRUST

CAPTURE A MOMENT

The still is of the moment that the princess is now back in her familiar Royal duties greeting guests and is faced with Bradley, instantly realising that her world might be overturned depending on whether Bradley is worthy of her trust. It is a moment of realisation of what it at stake, whose interests will be served?

To my mind when financial planning is done properly, you reveal a lot about who you are. You will know that we talk about your past experiences, your hopes for the future and your present reality. Understanding your values, verbalising them along with revealing past “mistakes” is very exposing. You have to trust that I and my team will handle this with care.

So, when we get back to the office, notice the large black and white picture and remember that anything that relates to “who you are” is strictly confidential.

As an aside, the film has an interesting back story. The screenplay was written by Dalton Trumbo who was a blacklisted writer in Hollywood at the time because of the ridiculous politics of McCarthyism. The screenplay, won the Oscar in 1954 and like many other blacklisted writers, a pseudonym was used or another writer “fronted”. It wasn’t until 1992 that the Academy finally acknowledged Trumbo and with the Oscar presented posthumously to his widow. Trumbo’s story itself was made into an excellent film in 2015.

Here are the two trailers, both films available but not showing at a cinema. Trailers with 62 years between them.

Roman Holiday 1953

and Trumbo 2015

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

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THE JOURNEY TO TRUST2021-07-05T16:17:18+01:00

AIN’T NO MOUNTAIN HIGH ENOUGH

TODAY’S BLOG

AIN’T NO MOUNTAIN HIGH ENOUGH

Following a recent move, I find myself living relatively close to the lovely area of Box Hill, just one of many areas of natural beauty that the Surrey Hills have to offer. Naturally, I decided to climb this vast (in my eyes) hill armed with my new-found affinity for going on walks, borne out of the depths of multiple National lockdowns – I’m sure that many of you will relate.

With some effort (made harder by my choice to climb in a practically vertical fashion up the 275 large steps to the summit instead of one of the rather more gentle inclines available), I made it to the top of the hill. I sampled the magnificent views and treated myself to a coffee – I felt that I’d earned it. I thought that the hard part was done.

Alas, I was wrong. My descent back down the hill was treacherous beyond imagination, leading to more than a few dicey moments and a poignant feeling of regret at my frankly dreadful choice of footwear. I lived to walk another day, though I’m sure that it was touch and go there for a moment!

As many of you already understand, accumulation of wealth is the growing of capital through various different means, most commonly saving and investing. We’ll call this ‘the climb’. This is the process involved in a financial plan that often comes to mind first and without doubt takes hard work, discipline and a detailed plan in order to reach any goals discussed at the outset. You would not be blamed for placing the greatest amount of importance on this stage. But what about decumulation?

In contrast, decumulation of wealth is the direct opposite of accumulation – utilising your capital (sometimes referred to as ‘spending down’) to cater for any one person’s particular needs, most often in retirement. We’ll call this ‘the descent’. This sounds like a wonderful situation to be in, and it is, but there are many potential pitfalls that one could fall into without proper thought and planning. Enter your financial planner. To ensure that you use the assets that you have worked so hard to accumulate over many years in the best, most efficient way possible – in order to allow you to continue to live the life you want to live – for us here at Solomon’s, that is what financial planning is all about.

So it’s important to remember that there are at least two sides to every hill – and any good climber will tell you how important it is to plan for traversing the other side. The descent can require as much consideration as the climb.

Daniel Liddicott
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on our 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

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The Old Bakery, 2D Edna Road, Raynes Park, London, SW20 8BT

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AIN’T NO MOUNTAIN HIGH ENOUGH2021-05-13T15:44:55+01:00

EROTICISM AND FANTASY IN YOUR FINANCIAL PLAN

TODAY’S BLOG

EROTICISM & FANTASY? IS THIS ANOTHER CLICKBAIT TITLE?

Whilst some of you are new to the blog and proper financial planning, many of you are aware that financial planning, when done well, is not really about money. Its about you. Your values, your hopes and your lifestyle.

In 2020 most of us took a battering, a year unlike any we had known. Whilst we greeted 2021 with the relief that 2020 was over, we have come to realise that things are far from normal and that there is much that keeps us living with a deep sense of frustration and perhaps fear. As the UK passed 100,000 covid deaths, we recognise another rather depressing landmark.

The restrictions of the pandemic have not been easy, exposing the pressures in our lives and creating new ones. Whether you are married or single, many have found relationships and normal aspects of life to be under pressures that they never imagined. Working from home has its benefits, but the confinement isn’t always helpful. Perhaps your home is empty, perhaps it is rammed full of people, attention and connection has been ruptured. Not being able to hug or kiss friends and family, to enjoy the normality of human interactions has reminded us of who and what is important.

Eroticism and fantasy

THE IMPACT OF LOCKDOWN

In February and March we all paid the price of investing with exaggerated market volatility, this was mercifully short-lived. It was also within our financial expectations, these things happen, regularly. The cause may be different, but the impact is not. The Government has been spending and it would seem handing out large sums of money to friends, this will have to be repaid by you and me, but what about the price our relationships have paid?

You may now be thinking to yourself, hang on, a financial planner has nothing to do with my relationships, where is this going? Let me cut to the chase. Money is often cited as a major cause of relationship breakdown. I don’t really believe it is. Not having enough or using it how you would like to can be. However, its deeper and more than that – it’s about your expectations which are a concoction of past experiences (“good” and “bad”) and your hopes for the future fused in the present.

Our hopes have been challenged and many have struggled with a sense of the future, particularly for young people. The magnitude of the stress on our wellbeing is significant. We have had many delights and joys removed and we have had to do the work of imagining, finding, creating and trying new ones. The loss of hope can be overwhelming, devastating, flattening and in many cases final.

REGAINING “EROTICISM AND FANTASY” 

So, I am going to offer you another real challenge. In our culture, we have little or no education about relationships – in all forms. That’s not to say that we aren’t blasted with messages about them, that is constant, but rarely does intimacy in its broadest sense get discussed. Irrespective of whether you are in a relationship or not, have a look at some of the work by Esther Perel (an expert!).Yes, I am even going to suggest you do pay attention to her work on the erotic, (a word neither of us expected me to use in a financial blog!) a term that she uses broadly. In fact I am going to suggest that you invest (I use the word quite deliberately) all of 46 minutes watching her webcast on YouTube “How Eroticism and Fantasy Can Help You Embrace A New Year”. Now there is a title to frighten you right? …

Perhaps to put your mind at ease, Esther playfully uses the term erotic when “creativity” is the word that resonates. Her talk is about life, not about sex. I appreciate that this may evoke mixed feelings within you, but my intention is simply to offer some access to meaningful hope. Hope and optimism are the oxygen of investors and financial planning.

Don’t worry, I am not going to go any further with this, other than to say that if a financial plan is simply about money, it isn’t really your plan, its probably someone else’s. Your plans are unique to you and I know that at the heart of them is relationship and a sense of connectedness. Remember the redemption of Mr Scrooge just a month ago?

With my very best intentions, I challenge/encourage you to watch… If I have overstepped the mark, accept my apologies, if it’s helpful let me know. You need to start the video at 1:30 – it was a livestream broadcast.

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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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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EROTICISM AND FANTASY IN YOUR FINANCIAL PLAN2021-01-28T13:27:19+00:00

CONTEXT IS EVERYTHING

TODAY’S BLOG

CONTEXT IS EVERYTHING

Whatever your view about coronavirus, I would prefer to trust explaining and treatment of any virus to a properly qualified medical expert rather than a member of Parliament. The focus on deaths is purely one measure of the virus, nothing more. As yet there is no (or very little) data about the long-term impact of the virus on individuals. A life lesson I learned many years ago is that investors over-estimate the short-term and under-estimate the long-term. That is true of everyone, not simply investors. We have short, flawed memories.

As for covid, many suffer ongoing symptoms months (currently known as long covid) after first contracting the illness. To measure the danger of virus based purely on deaths is rather like measuring road traffic deaths and concluding that they are low.

A NEW GREEN CROSS CODE FOR HEALTH

In 2018 in the whole of Britain 1,784 people were killed in reported road traffic accidents, yet there were 25,511 (14x) seriously injured casualties and a further 133,302 (74x) slightly injured casualties. Focus on the number that died out of a population of about 66.27million does not mean that just because “only” 0.003% died none of us should wear seatbelts or observe the highway code.

The uncomfortable truth is that we do not yet know the long-term (or even short-term) impact of covid on public health. We hope and look forward to a vaccine. However as with road accidents, there are a great (vast) number of people that will be impacted with poorer health.

SOLOMONS IFA - MORNING WALK IN THE FOG

BEYOND HEADLINES

In a related theme I noticed a fairly stark statement by a local politician. “10,000 deaths a year in London from air pollution”. Let me be clear, I am not a climate change denier, but I didn’t believe the statement. Instinctively it didn’t feel right. So I checked. In London (inner and outer) there are about 50,000 deaths a year in total. That’s everything from infant mortality, “old age”, cancer, road deaths, murder, suicide – the works. There is no way that 20% of those are due to air pollution. Everyone dies in the end.

IN A HAZE

Certainly you may notice the air quality in London being poor or awful at times, there is room for improvement (always). However, this is to forget the context. Take the Great Smog 5-9 December 1952. Estimates at the time were that 4,000 people died as a direct result, with 100,000 made ill, some of them very seriously indeed. Actions were taken to improve the quality of London air and have been ever since. The number of deaths registered in London has fallen enormously over the years. I have found data to 1966, some 14 years after the Great Smog there were 87,991 deaths (London) in 1966 some 5 years later this has reduced to 84,990 in 1971. Thereafter each subsequent decade later the numbers reduce. By 2011 the number had fallen to 46,685. Last year the figure stood at 49,007. Admittedly increased since 2011, but then so has the population from about 47.9m in 1966 (England and Wales) to 57.4m by 2014.

PAST, PRESENT, FUTURE

Data always requires a context and this invariably requires looking back. The main problem with financial planning is that we look forwards, often forgetting how far we have come. It is important to remember what things were like, this provides confidence that the future is hopeful. As for wondering if financial planning is important, think back to your own childhood and the cost of a stamp – look it up (if you were born before decimilisation you will have to convert imperial). One of the basics of financial planning is to keep your spending power rising or at least equal to inflation so that you can still afford your lifestyle, fear of the future is likely to be your worst enemy. Do not under-estimate the future or forget the past.

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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CONTEXT IS EVERYTHING2020-09-15T16:22:39+01:00

ENGINEERING THE FIGURES

TODAY’S BLOG

ENGINEERING THE FIGURES

There are many good things about social media, but I do get fed up with some of the narratives thrown around that, in my opinion, casually have an agenda. One topic that often gathers some traction is that of the property market. Most of us discuss the ludicrous price of buying a home at some time, some make much of their skill to invest in property, which is often rather more to do with luck than skill. However I have become very tired of the media holding out examples of some young people who got onto the property ladder and in so doing imply that others only have themselves to blame for their inability to do so.

DISTILLING THE TRUTH

I came across a couple of examples in the last few days. One involved a 28-year old whose father bought him a bottle of 18-year old Macallan whisky on the day of his birth and then every birthday thereafter. The headline suggested that this enabled Matthew Robinson to buy his first home. The virtues of foresight by his father and personal resistance of temptation netting the result of £40,000 worth of whisky. It’s a lovely idea and nothing wrong with it at all as a gift. I have some questions though.

UK Property

IN GOOD SPIRITS

Firstly, the whisky has not actually been sold yet and no home has been purchased. This deposit was not actually the hard work of Matthew but of his father. The only thing Matthew has done is follow his fathers instructions not to consume it. I wonder how it was stored, I suspect that the 28 bottles have not followed Matthew away to University or any other place he may have lived, they probably remained at his parents home (I am guessing). As a gift it’s a lovely one, as an investment…. Well, there are obvious risks – which no proper investment portfolio would have – concentrated risk and the past, current and future risk of total wipe out. I could literally destroy a portfolio of whisky in minutes. I could not do the same for any investment portfolio.

ROOM WITH A VIEW – TUNNEL VISION VIA BOX

Then there was the case of Jessica Leung who at 29 managed to buy a property worth £450,000 in Bristol, right opposite IBK Brunel’s the SS Great Britain. This, the headlines suggest was done by moving home to save rent and cancelling her gym membership. It turns out that Jessica was able to put down a £90,000 deposit, pay stamp duty and raise a mortgage of £360,000 on her own salary. It turns out that 30% of the deposit was from her father (£27,000) and “family savings” of £53,000 together with her own £10,000 make £90,000. In fact, Jessica had saved £10,000 not really £90,000. An engineering of “I saved the deposit” feat that Mr Brunel might marvel at. Given that she would likely require an income of £90,000 to borrow £360,000 then to be blunt she might have saved rather more.

Do not misunderstand me. I am not berating Matthew or Jessica or indeed their parents. To my mind these stories have rather more to do with making other young people feel inadequate and relieving the sense of guilt (we did absolutely nothing to benefit from property price rises)  that the rest of us have from time to time, when we recognise how hard it is. The truth is that the parents were instrumental in raising the deposits in both instances. These sorts of mixed messages are rife – a few months ago young people were chastised for buying lunch at Pret, now they are being told to do so in order to keep it open. The messages are all to do with supporting those in power who clearly have a lot vested in maintaining the property-owning class precisely as it is.

Rather obviously I work with clients to help them become financially independent and many parents want to help their children as these did. However, pretending that because some can that it is just a matter of personal disciplined saving by the young adult is utter twaddle. I expect nothing to change.

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

ENGINEERING THE FIGURES2020-09-07T15:28:05+01:00

HOW PERSONAL IS PERSONAL BANKING?

TODAY’S BLOG

HOW PERSONAL IS PERSONAL BANKING?

We all know (I think) that the days of the traditional bank manager are long gone, these days banks dress their offering with “personal banking” (as though it has been anything else before!). This is meant to be the main reason for staying with your traditional bank (and most will have done so since their teens) as opposed to using a new bank – a disruptor.

It seems to me that there is a significant degree of lip service paid to the idea of personal banking. You may have the luxury of perhaps having the name and email address of your “relationship manager” but there are some inherent problems. Each new year brings the prospect of yet another letter explaining that my personal relationship manager has altered… again. The best of intentions is re-established. I would not like to guess at how many “clients” these relationship managers have responsibility for – but let us assume it is way too many to have time to form any that are meaningful.

THE BANK

A RELATIONSHIP YOU SAY?

Today I was emailed by my personal relationship manager about the latest (standardised) investment offering that they have. Apart from not being a good offer, but a very similar (yet still more expensive) cost to a proper advised investment, it was a bit of a pity that nobody had thought to ask what I did for a living. This is a bank that I have been with for 4 decades.

I will not bother naming the Bank – they are all much the same. You will recall that in the past most mis-selling scandals were directly to do with poorly trained and badly incentivised advisers within Banks. The gaping hole of adequate planning and saving for the future has been noted for many years. The regulator is hoping for the Banks to fill some of that with algorithms and rather good bits of IT plugging the rest. Financial planners generally deal with people that are already engaged with planning ahead or have recently started to do so – and there are not that many of us anyway – about 24,000 for a population of around 66m.

NOT ON THE HIGH STREET

I suspect that the Banks will continue to disappoint. Heck you cannot even rely on them to be on your local high street if you should ever need to “pop in”. Imagine how difficult this is for elderly people that have little appetite for the internet or online banking and are not able to easily get to their new nearest branch. Personal it most certainly is not, hopeful yes, but I also suspect the outcomes are also predictable.

WE CAN DO ALL THIS BETTER

If you are someone with a few hundred thousand in cash, then of course the Investment Banks are now interested in you, but you will quickly discover that to them personal means treating you to sports events and corporate hospitality in exchange for some over the top fees. We can arrange investments better; we can arrange cash savings accounts better. Personal is what we do because what we do is all about your plan.

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

HOW PERSONAL IS PERSONAL BANKING?2020-07-22T11:30:47+01:00
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