Market Update – Is Everything Uncertain?

As we reflect on the three months since our last market update, ‘unpredictability’ seems to be a continuing theme.

Within three months, it seems that politically we have moved from what many foresaw as a clear direction, to having a snap General election and politicians learning that the UK electorate is not afraid to voice their opinion.

The overriding theme seems to be that whilst Brexit continues, many feel that ‘austerity’ needs to be slowed or even ended.

Despite the media’s portrayal of this being unprecedented, many of the arguments are very familiar and well established. It has always been a balance of economic and social goals.

From an investors perspective, the unique situation is how we extricate ourselves from Europe, our productivity in terms of GDP as a country, plus the ongoing period of low interest rates.

This has a direct impact on how global markets view the UK and as a result our currency exchange rates continue to fluctuate. At the moment, the slightest change has a direct impact on the FTSE indices.

Yet despite these concerns the UK and global equity markets have been fairly steady. Overall the year to date has been one of steadiness. Clients have seen their portfolio valuations rising steadily.

Looking ahead, most pundits are in agreement. In the short term, the UK looks as though it is going to have some volatility politically, but most foresee opportunities for investors over the longer term and most global investors are looking at equity investments as being a good opportunity.

Overall, we agree with this positive outlook and remain focused on what is described as a ‘value’ investment strategy.

That said we are equally focused on diversity and with most clients, we continue to build portfolio’s including all sorts of asset types within investments including property, fixed interest, absolute return funds, and, most recently, infrastructure funds.

Long term we are confident clients will see real growth in the portfolio’s.

As always, do not hesitate to get in touch with Platinum, and our team, if you would like to discuss your investment strategy or if you have any concerns.

Regrets people have in retirement, and how to avoid them

Research from a major insurer has thrown an interesting light on how pensioners are finding retirement. The good news is that 94% of recent retirees surveyed report that they are really enjoying their later years. However, 41% say they regret mistakes they made in planning for their retirement. In some instances, these mistakes have meant they are facing financial struggles that could have been avoided.

NOT SAVING ENOUGH

Many people reach retirement and wish they’d put more into their pension plan in their peak earning years. Keeping a regular eye on how much you’re saving towards your pension will ensure that you know how much you’re likely to have when you retire, and give you the chance to increase your contributions if you can afford to. Getting an accurate state pension forecast is important too; many people overestimate how much their state pension will actually be worth, and aren’t sure at what age they will receive it.

NOT SAVING SOON ENOUGH

When people look back on their working lives, they can sometimes feel a sense of regret that they didn’t put more money aside early enough in their careers. It’s true that for most 20 year olds the thought of saving for retirement isn’t even on their radar. However, the younger you are when you start to save, the more time your money has to grow. Thanks to what Einstein referred to as the ‘8th Wonder of the World’, compound interest, even small sums saved whilst you’re young can steadily mount up over the years.

NOT BUDGETING PROPERLY FOR RETIREMENT

It’s a good idea in the years preceding your retirement to work out how much you are likely to need to fund the lifestyle you want to enjoy in your later years. True, some costs like travel to work will decrease, but others such as heating bills are likely to rise. Putting together a budget that includes household expenses, and takes into consideration how much you’re likely to spend enjoying your increased leisure time, will help you plan and save more appropriately. It’s important to factor in the likely cost of future care needs too.

NOT TAKING PROPER ADVICE

Under the pension rules introduced in April 2015, those planning their retirement have more choice than ever before in how and when they access the funds built up in their pension pot. However, for many, the options can be confusing and difficult to evaluate.

It’s never been more important to make the right decisions at retirement. Increased life expectancy means that people retiring today can expect to have several decades of active life ahead of them. Making sure that their funds don’t run out too soon can often be a major concern. Taking independent financial advice can help ensure that you have a plan in place that meets your likely pattern of expenditure, and keep funds in reserve in case you need to pay for nursing or residential care.

It really is important to consider the ‘value of advice’ not just in monetary terms but also for its role in bringing greater certainty, reducing stress and saving time. Our team are here to guide you through the advice process, so call us on  0161 718 8328.

 

Peace of mind for you and your family

The peace of mind that protection policies can provide

A recent study shows that many families are overlooking the benefits that protection insurance policies can provide and the peace of mind they can bring. Life cover may be one of those things you’ve been meaning to sort out for a while but haven’t yet ticked off your list. It’s undoubtedly one of the most important financial products anyone can take out, and one of the best ways of leaving loved ones provided for financially.

Whilst most people understand the need to have life insurance in place if they have a big financial commitment like a mortgage, many more are overlooking or unsure of the benefits that other types of insurance cover can provide. Life insurance and critical illness cover can be a vital buffer against life’s unexpected events, providing much-needed funds on death, or the diagnosis of a critical illness. But that’s not all; there are other policies available that can provide much-needed financial support for families if they are hit by unforeseen problems such as an accident, sickness or unemployment.

There are life policies that provide lump sums, and policies such as family income benefit that instead pay a regular income in the event of your death during the term of the policy. You can also protect your income, so that if you can’t work due to illness or injury you receive a monthly income that’s paid until you can return to work or reach retirement age.

FLEXIBILITY TO MEET YOUR NEEDS

The great thing about protection policies is that the cover can be tailored to meet your needs throughout your life. We often find that our clients’ insurance requirements change when they buy a property or have a family, take on more debt or change jobs, and we help them get the cover they need at every stage.

Finding the right policy that provides the right level of cover and represents good value for money can be hard on your own; why not let us help you find the best policy for your needs?

We are happy to help you to achieve peace of mind for you and your family. Please contact us on 0161 718 8328 to arrange a meeting with one of our advisers.

Does it make sense to combine your pension pots?

The days when people began their careers with one employer and stayed there until they retired are long gone. It’s estimated that depending where you live, people now have an average of between six and 11 different jobs during their careers. This can mean that over the years they end up with pension entitlements in several schemes with different providers.

In certain circumstances, it can make good financial sense to consolidate your pension into one new plan. This means you can manage all your retirement savings in one place, reducing the paperwork and administration. You might be able to save money on fees, and choose funds that are better suited to your investment outlook and attitude to risk.

However, there are circumstances where this might not be in your best interests. If you are in a public sector pension scheme, such as the nurses’ or teachers’ schemes, then the benefits they offer can be hard to replicate elsewhere. Or, if you have saved into an employer final salary scheme, you may find that it offers guaranteed retirement income or guaranteed annuity rates, valuable benefits that you would lose if you moved it elsewhere. You may be charged exit fees too.

If you are lucky enough to be currently contributing to a final salary scheme, it’s worth finding out if your employer will allow past contributions from other pensions to be moved into their scheme.

If you move jobs, you may be able to consolidate your previous pensions into your new employer’s scheme. You should think carefully before doing so; you will need to be sure that the benefits offered are as good as those in any scheme that you contemplate leaving.

GOOD ADVICE PAYS

Taking professional advice will help you weigh up your options and make the right choice for your financial circumstances. We are here to help you understand the costs, benefits and risks involved in moving any of your pension pots. So go on, dig out your pension paperwork and get in touch with us on 0161 718 8328.

Is A Snap Election Good Or Bad News?

Theresa May’s decision to call a snap election, initially felt like an attempt to throw a stone in the relatively calm ‘investment’ pond, as markets have had an unparalleled and unexpected period of low volatility and positive market growth.

Yet the sudden announcement didn’t create the feared market turmoil. Rather markets settled down and Sterling strengthened as a currency.

The main reason being financial markets, around the globe, saw the announcement as an opportunity for more stability and predictability.

On listening to and reading the various market updates from investment houses, they’re united in their view that Brexit could still create ups and downs for investors, yet the opportunity for a clear political direction for the upcoming five years is very welcome.

Plus, the various polls showing the Conservative’s should be in a strong position to negotiate with the EU over Brexit is also perceived as a stable and predictable outcome.

Equally, the French election has now been settled and reasserted some stability in Europe.

As always, we would add that very little is 100% predictable in life therefore there is still cause to consider all options. For our clients, we consistently look to ensure they’re diversified across various sectors, asset classes and geography.

Our aim is always to take advantage of investment growth opportunities yet being prudent to hopefully protect against harsh stock market falls. That objective seems more pertinent at the moment as ever.

Market Update – Brexit Has Started!

Only a year ago, our April 2016 market update was looking ahead at the referendum. Now Brexit is officially underway.

From a financial aspect, probably the greatest surprise for all pundits and financial managers is how consistent and bullish markets have been over the past 12 months.

On the build up to last year’s referendum, markets dipped, but since then there has been positive growth.

Earlier in the year, the US election looked to derail the growth, but once again pundits were caught out.

The market correction has failed to materialize, and the main indices have had 3 months of what is near record levels of low volatility whilst also surpassing previous market highs.

Where now is the key question?

As a result of the low volatility and a reasonable level of encouraging data, there is an air of optimism, despite the upcoming negotiations with Europe.

From an asset allocation basis, property continues to offer steady, if unspectacular, returns.

Fixed interest, such as gilts and corporate bonds, remain muted and are less favoured despite being an almost essential constituent of everyone’s portfolios. Equally absolute return funds, continue to offer the hedge or potential cushion if markets do take a surprising turn.

Equities remain the focus of most investment portfolios.

On a global view the US is still offering great opportunities as their economy looks to be moving into a growth phase. Other global markets are similar.

Regarding the UK and Europe there is an understandable wariness. Within both regions, it is important to focus on actively managed funds who make their investment choices based upon fundamentals rather than simply following the herd.

This type of value investing is something we agree with and has been a constant theme in helping us manage our clients’ portfolios.

Overall, we are positive and thing the long-term view is encouraging. For our clients, we are also keeping an eye on the short-term and will continue to adjust portfolios and investments accordingly.

As always, do not hesitate to get in touch with Platinum, and our team, if you would like to discuss your investment strategy or if you have any concerns.

Tax year end – time to take action

In the words of comedian Chris Rock, “You don’t pay taxes — they take taxes.”

When you are given an opportunity not to pay taxes, do you take it?

By planning ahead and taking financial advice you can ensure you are minimising the tax you pay now and in the future by taking advantage of the tax exemptions and allowances available to you.

Our clients know that we help them manage their tax affairs efficiently by utilising all the allowances and exemptions available, such as the following:

  • ISA’s are a savings account that is free from tax. The ISA allowance for the 16/17 tax year is £15,240.
  • Capital Gains allowances let you utilise gains of up to £11,100 without any liability to tax.
  • Pensions are a long terms savings plans with tax relief available. Your contribution will increase by at least 20% in the form of tax relief by just paying into a pension. You are allowed to invest a 100% of your earnings or £3,600 whichever is higher up to £40,000.
  • Inheritance planning gives you an opportunity to gift £3,000 per person for this tax year, and the previous tax year (if not used) without being liable for inheritance tax.

 

It is essential to seek financial advice for tax planning purposes as you save for your future. On the run up to the tax year end we welcome you to get in touch for a financial review to ensure you have taken advantage of tax incentives available to you.

We look forward to hearing from you.

How to search for a good financial adviser…

We always encourage our clients to share our details with their family, friends and colleagues, to ensure they too receive the same trusted financial advice from Platinum.

If you are starting from scratch though, where do you start in the search for a good financial adviser? Here are some tips to help you.

  • Draw up a list of what is important to you – maybe you want them to be local to you or to be able to advise you in a specific area of advice.
  • Call several advisers before you choose to find out how their process works – the adviser should be able to explain what they do in language you understand
  • Find out whether you can get a free initial consultation – many advisers will offer you a no obligation meeting without charging.
  •  Ask how you can pay – All financial advisers (whether they are independent financial advisers or restricted advisers) who deal with investment products and pensions have to charge you for advice.  However, there are different ways that you can pay an adviser (for example, an hourly fee, a fixed fee or a percentage of the money you’ve asked them to invest).
  • Ask what you can expect for your money. If the financial adviser takes an ongoing fee to manage your money what will you get for this?
  •  Check out the adviser’s website so you can learn about the adviser and the company you will be dealing with. Do they use social media too? This is a good way to connect with the adviser, learn more about the company and get a feel for what they do and how they do it. There will probably be client reviews on there too

 

We are always happy to discuss your circumstances and answer any questions you may have. We invite you to get to know us better by connecting with us on social media

Visit our website http://www.platinumifs.co.uk/

Visit our blog at http://blog.platinumifs.co.uk/

Follow us on Twitter https://twitter.com/platinumifs

Like us on Facebook https://www.facebook.com/platinumifs/

Are you using your tax breaks?

In the view popularly attributed to Benjamin Franklin, nothing is certain except death and taxes. By planning and taking advice you can ensure you are minimising the tax you are paying by taking advantage of the tax exemptions and allowances available to you.

At the basic level, there is a personal income tax allowance, an annual exemption from capital gains tax plus numerous tax credits dependent on your circumstances. Schemes like Gift Aid offer tax relief on donations to charity and there is also an Inheritance Tax (IHT) threshold below which nothing is due.

In additon, there are tax efficient investment products such as Individual Savings Accounts (ISA’s) and pensions that provide relief from both income and capital gains tax (CGT) and some individual assets such as your home, your car and UK Government Bonds (gilts)  that are specifically exempt from CGT.

It is equally important to seek financial advice for tax planning purposes as it is for saving for your future. On the run up to the tax year end we welcome you to get in touch for a financial review to ensure you have taken advantage of tax incentives available to you.

 

Market Update – Stock Markets Continue to Defy Pessimists

2016 was a torrid year dominated by political tensions, global changes and a rebuff of the status quo. Yet at the end of the year the main stock market indices maintained their surge and finished the year in positive territory.

As 2017 gets underway the FTSE 100 has again pushed its way upwards.

Despite this optimism, 2017 still looks like a challenging year for investors as Brexit negotiations continue, President Trump takes office and European countries face key elections.

Arguably one main reason for the FTSE 100 maintaining it’s high level is the strength of the pound. Whilst Sterling exchange rates remain poor compared to other currencies the larger companies look forward to greater profits which in turn boosts their share prices. Sterling though is likely to recover over the long term which would then put pressure on those same FTSE 100 firms.

That said, investors shouldn’t panic and the outlook need not be gloomy for diversified investors.

For example, the sustained period of low interest rates and exchange rates is helping the smaller companies, i.e. those outside the FTSE 100. These companies take some time to benefit from the economic conditions and this is slowly starting to filter through.

Equally other asset classes such as property continue to generate steady returns. Property can be a complicated investment, yet as a minor portion of any portfolio it is now showing ‘reliable’ returns in a very uncertain world.

There will also be some good opportunities arising for corporate bond investors, although the sector will continue to be punished in the short term by low interest rates and a weak pound.

Looking at the year ahead it is important not to get distracted by the media. We seem to be inundated with in-depth negative analysis of every slight comment and tweet.

Long term investors and financial markets will return to what is described as value investing, which is selecting investments based upon long term profitability and fundamentals.

This value style investing lends itself to a balanced investor who has a diversified portfolios of different asset classes and funds. Investors also benefit from selecting fund managers capable of picking out the quality investments rather than a scatter gun approach designed to follow the average index.

As always it is important to continue to review any investments on a regular basis. For our clients, we are constantly mindful of the pitfalls ahead and will help to alter your portfolios to benefit from future opportunities.

We look forward to helping review your plans. However, in the meantime, don’t hesitate to get in touch with Platinum if you would like to discuss your investment strategy or if you have any concerns.