Losing your partner at any stage in life can be devastating, but it may be particularly devastating when children are involved because of the financial pressures of raising a family. Ensuring your children and other dependants are provided for in case you die should be a top priority but less than a third of people in the UK have life insurance.

Keep it simple
Many products are available but a simple level-term policy, where a pre-decided lump sum is paid out should you die within a stated period, is among the simplest to arrange and is typically not very expensive. As a rule of thumb, life cover should provide ten times the main breadwinner’s income. The amount should cover any outstanding debts, including mortgage, regular outgoings, potential university fees and so on. The term should reflect the needs of your dependants; Children will probably need support until they leave education and a partner may need it until pensionable age.

Joint or single cover?
A joint policy will cover you and your partner, paying out on the first death within the term. Alternatively, you can have separate single-life policies; a little more expensive but potentially two payments. A young, fit individual should find life cover affordable. Be open about your lifestyle, especially if you have existing medical issues. Premiums rise with age, lifestyle factors, such as smoking and other factors that affect your life expectancy.

Keep under regular review
Reviewing your protection needs helps make sure you have the right cover in place for your financial circumstances, giving you the peace of mind that you’ve got things covered.

As with all insurance policies, conditions and exclusions will apply.

COVID-19 affects retirement plans for over three million

KEY TAKEAWAYS

• One in 10 UK adults, with a pension and not yet retired, have reduced or stopped pension contributions because of the pandemic
• Savers are having to decide between their short-term financial needs and long-term savings 
• Almost a quarter of workers (24%) are worried about paying for essentials such as food and energy and a fifth (20%) are concerned about paying their mortgage or rent
• Those groups already struggling to save for retirement including the self-employed, younger workers (18 to 24-year-olds), women and part-time workers have been found to be most affected financially 
• Two in five self-employed workers (43%) have seen their income drop, almost three times the proportion of employees (16%)
• The self-employed are unable to be included in auto enrolment
• 18 to 24-year-olds are likely to reduce pensions savings and 7% have moved into lower-risk funds
• Women and part-time workers have also seen a greater impact on their ability to save
• Contact us to review your options if you are thinking of changing your pension in any way
• If you have already done so, as soon as your situation improves, we can help you review your retirement planning.

The world is changing – so should your insurance

Update on mortgage payment holidays

Protecting your business in difficult times

It’s time to think about life insurance

The Bank of...Granny and Grandad?

Let’s be honest, on the morning of 21 October few of us were waiting with bated breath as the latest UK inflation stats were revealed. But, for millions of people, that moment was significant.

As we entered the new year with further lockdowns and history making world events, the hope of spring hangs in the air, an enticing prospect, this year, more than ever. While we’re waiting for the green shoots of spring to emerge, why not use the time effectively by getting your finances in order before the end of the tax year?

The tax year ends on 5 April 2021, which is Easter Monday this year, so don’t wait until the last minute to double-check you’ve taken advantage of all the tax-efficient allowances available to you. To avoid a last-minute Easter rush, we’re on hand to get you organised with all aspects of your end of tax year planning. Here’s a reminder of some of your main tax planning opportunities:

Pensions
— The current Annual Allowance is £40,000 (for every £2 of adjusted income over £240,000, an individual’s Annual Allowance is reduced by £1. The minimum Annual Allowance is £4,000
— The Lifetime Allowance places a limit on the amount you can hold across all your pension funds without having to pay extra tax when you withdraw money. The limit is currently £1,073,100

Tax efficient investments
— Individual Savings Accounts (ISAs) – maximum annual contribution of £20,000 per adult (stocks and shares, and cash options available, maximum allowance not to be exceeded)
— Junior Individual Savings Allowances (JISAs) – maximum annual contribution of £9,000 per child (stocks and shares, and cash options available, maximum allowance not to be exceeded)
— Enterprise Investment Schemes (EISs) – maximum investment of £2,000,000, relief on investments in certain unquoted trading companies, up to £1m per annum (or £2m as long as at least £1m of this is invested in knowledge intensive companies)
— Venture Capital Trusts (VCTs) – maximum annual investment of £200,000, relief on investment in certain qualifying companies

Making Inheritance Tax-free gifts
— Each financial year you can make gifts of up to £3,000 (in total, not per recipient) and if you don’t use this in one tax year, you can carry over any leftover allowance to the next year (some other exempted/ small gifts allowable)
— To reduce the amount of IHT payable, many families consider giving their assets away during their lifetime. These are called ‘potentially exempt transfers.’ For these gifts not to be counted as part of your estate on death, you must outlive the gift by seven years
— If you have enough income to maintain your usual standard of living, you can make gifts from your surplus income.
Advice is essential as strict criteria apply

Using Capital Gains Tax allowances
— Annual exemption of £12,300 per person, £6,150 for trusts – currently under review, correct at time of publication.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Past performance is not a reliable indicator of future performance and should not be relied upon.

Due to the high-risk nature of these products (EISs and VCTs) they will not be suitable for everyone.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Did you know that the State Pension age (SPA) increased to 66 for both men and women in October 2020 and it’s set to rise further? Knowing your SPA, together with how much you can expect to receive, is an important part of your retirement plan that is often overlooked.

Why do I have to wait longer?
In 1908, when the first State Pension was introduced in the UK, you would have to wait until the grand old age of 70 before being able to claim. This was at a time when life expectancy at birth was around 40 years for men and 43 for women, and when only 24% of people reached State Pension age!

As recently as ten years ago, women could claim their state pension at 60, while men had to wait until they were 65, but qualifying ages have now been brought into line. The changes were introduced due to increased life expectancy, as people are now likely to spend a larger proportion of their adult lives in retirement than ever before.

66, 67 or older?
To find out your SPA, visit the government website www.gov.uk/state-pension-age - this will provide you with an exact date. However, you are no longer forced to take your pension at this age, so you could consider working longer if that suits your circumstances.

If you were born after April 1960, your pension age will be 67 and people born after April 1977 will have to wait until age 68 under current proposals, although the government is considering plans for this to be brought forward.

How much will I get? The State Pension is paid to anyone who has made at least ten years’ worth of National Insurance contributions during their working lifetime. The maximum payment is currently £175.20 a week (£9,110.40 a year), but how much you get depends on how many years you contributed for. To check your State Pension forecast, go to www.gov.uk/check-state-pension.

You may also be able to apply for National Insurance credits or pay voluntary National Insurance to boost your State Pension, although the best options will depend on your individual circumstances.

A timely reminder to plan ahead
Why not let the recent increase to the SPA act as a reminder to review all your pension pots, including your State Pension, to consider whether your savings are going to allow you to have the retirement you’ve dreamed of. We can help you get on track, so why not get in touch?

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested

Nudge theory was popularized in 2008 by behavioural economist Richard Thaler and legal scholar Cass Sunstein. In simple terms it is about making it easier for people to make a certain decision that is ultimately in their own self-interest.

Day-to-day
In the short term there are some financial nudges you can do to apply nudge theory to your own finances.

Put your decisions into context – During lockdown, local or national (or whatever COVID-19 throws at us next) do you really need to buy another plant, candle or pair of joggers. 

Set simple and clear goals – A single goal like save £6,000 for a car is much easier to achieve than multiple goals like save for a home, car, and holiday.

Make it easier to do the things you should do (and hard to do the things you shouldn’t) – Putting small barriers in the way of everyday things, like not allowing your browser to remember your PayPal password, makes it harder to spend money and you may ultimately decide not to.

Don’t ignore information and the facts – check your budget, bank statements and accounts regularly.

Long-term
Do you like going on holiday, eating out and enjoying your hobbies? If so, it’s likely your ‘future self’ will too. Far from sitting in an armchair in your carpet slippers and a tartan blanket, it’s much more likely that your future self (who is, after all, still you) will want to enjoy their retirement in style.

So, what’s the dream? Well, according to research from Aviva, almost half of people want to travel when they retire, while taking up a new hobby and helping their children and grandchildren out financially come second and third on the list – all suggesting that people want to live their lives to the fullest in their later years. Unfortunately, translating the dream into reality is where it falls apart for some – 23% of people think their retirement is likely to be a financial struggle.

Living the dream
A study has hit on a novel solution to the problem – ‘nudges’. In other words, by making small behavioural adjustments to your spending habits, you could enjoy an additional £7,000 every year in retirement income.

The key lies in encouraging young people to imagine themselves in the future, rather than viewing their ‘future self’ as a different person.

Understandably, a lot of young people are focusing on their current financial priorities – after all, we’re in the midst of a global pandemic. But that doesn’t mean your future financial needs have gone away. So, rather than thinking of your ‘future self’ as a stranger, treat your pension like a gift you’re giving yourself – you just can’t open it yet!

Get nudging
COVID-19 hasn’t given us many silver linings but reduced living expenses due to remote working and the closure of bars, restaurants and other leisure and hospitality businesses could provide a welcome boost to our savings.

Similarly, you could save around £40 a month by keeping going with the home workouts, like the 72% of people who say they have no plans on going back to the gym. In addition, many kids’ clubs have yet to start back up following lockdown, so parents could be making big savings here, too.

Save on subscriptions
Foregoing the latest iPhone could also save you a hefty sum. Keeping your existing handset instead, and switching to a SIM-only deal, could help you move some welcome funds into the pension pot.

Or, you could divert an average £39 per month in wasted subscriptions into your pension. Unused gym memberships, phone contracts and subscriptions to online video streaming services are all common culprits, according to research.

Expert ‘nudgers’ at your service
If you need a ‘nudge’ from us to help boost your retirement income, we’re just a phone call away.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Estimates suggest that well over one million borrowers have lapsed onto their lender’s default standard variable rate (SVR). Has this happened to you? If so, now could be the perfect time to consider a remortgage, to get your finances in good shape for the year ahead.

Do you know your mortgage rate?
If your current tracker, fixed rate, or discount mortgage deal has ended, you are likely to be switched onto your lender’s SVR and could be paying way over the odds, perhaps without even realising. It has been found that borrowers on an SVR could save an average of £1,602 a year, that’s over £133 every month! 

Sound familiar? 
Even with a potentially sizeable saving to be made by remortgaging, it’s surprising how many people just stick with their SVR. Why is that?

“I didn’t realise my mortgage deal had ended” - your lender should have let you know, but always remember to make a note of the end date of a new mortgage deal so you don’t forget.

“My lender contacted me, but I didn’t understand”- mortgage jargon can be confusing, but it pays to check out important mortgage correspondence.

“It’s too much hard work to find a new deal”- it’s true that the mortgage market can be bewildering as there are so many deals to choose from. That’s where we can get involved – to help find you a suitable deal. You can then choose what to do with any savings made!

Time to remortgage?
It’s important to regularly review your mortgage. Particularly now, when mortgage rates are at record low levels, it makes sense to consider your options to see if you can get a more cost-effective mortgage deal.

Are you still covered? 
If you’re thinking of changing your mortgage, remember to review your protection policies at the same time - especially if you don’t already have cover in place, or your circumstances have changed since you last reviewed your cover. 

To discuss your remortgaging options and to see if you could save money, please get in touch. Rest assured we are here to help if you have any questions about your mortgage or your protection requirements.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

You’ve retired from work, you’ve waved a cheerful goodbye to your colleagues and you’re ready for the rest and relaxation you so rightly deserve. It’s exciting! For a couple of weeks. Then the doubt sets in.

What will you do with your life, you might find yourself asking? How will you fill the long daytime hours? How will you manage without the comfort of your routine? Where will you find your purpose, if not from work?

Planning – it’s not just financial
Whenever we talk about retirement, it’s all about the pension. If you have enough in your pension pot when you retire, you’re all set, right?

Many retirees simply aren’t prepared for how significantly their life will change, and many, while not missing work per se, will certainly miss the sense of purpose it offered. And, with life expectancy on the rise, it’s daunting to contemplate the next 20 to 30 years without any of the structure around which you’re used to organising your life.

‘Reinvent’ yourself
A European study funded by the Erasmus program argues that we should start preparing for retirement as early as 50. Suddenly stopping work after spending a lifetime focused on your career, it argues, can be the catalyst for depression and other mental health issues. That’s why we need to ‘reinvent’ ourselves in our 50s by discovering new passions and interests, improving our mental and physical health, and generally forging a life for ourselves outside of work in the run-up to retirement.

So, what steps can you take to prepare for a happy retirement?

Happy, healthy, whole
Retired or not, you’ll still want and need similar things in life: a sense of purpose, social interaction and activities that interest and stimulate you. With this in mind, here are our tips for preparing for a fulfilling retirement:

Wind down in stages – rather than going from full-time to retired overnight, why not try reducing your hours first, giving you the fulfilment of work combined with the free time to pursue other interests?

Exercise your body – and your mind – experts have long extolled the virtues of exercise for our physical and mental health. Getting into the habit now could really help your emotional state when you retire.

Be a social butterfly – in addition to solitary hobbies and interests, joining groups and clubs can help you develop social networks outside of the workplace.

Get a furry friend – as well as keeping you company indoors, a pet (such as a dog) will give you an incentive to get outside in the fresh air.

Don’t neglect your pension – while preparing emotionally is a big part of retirement, the money still has to be there to allow you to live life to the fullest.

Would equity release be right for you? A way of supplementing your retirement income using the value tied up in your home, although not right for everyone, we can help you explore your options.

We do the finances, you do the rest
That’s why we’re here! We can help you sort out the financial stuff to provide you with the resources to spend your retirement free from money worries, so you can concentrate on enjoying your later years. Why not give us a call?

You will need to take legal advice before releasing equity from your home as Lifetime Mortgages and Home Reversion plans are not right for everyone. This is a referral service.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

When Tom and Pete bought their first property together, things couldn’t have been going better. They both had good jobs, were pulling in decent salaries and were excited about spending the rest of their lives together.

They chatted about making a Will a few times, but somehow life always got in the way. Until one day, 10 years later, Pete got a call that would change his life forever. Knocked down by a car while crossing the road, Tom had tragically passed away.

The intestacy trap
Grieving for the loss of his partner, Pete then found out that, due to the UK’s intestacy laws, he wasn’t entitled to inherit any of Tom’s property, financial assets or belongings, unless they were jointly owned. Despite Pete knowing that Tom had loved him and would want him to inherit, the absence of a Will meant that none of that mattered.

Thankfully, Pete and Tom had owned their property as joint tenants, meaning Tom’s share automatically passed to Pete according to the rights of survivorship. However, without children or any surviving parents or siblings, the remainder of Tom’s assets ended up being passed on to a distant uncle with whom Tom didn’t have any contact.

Now, Pete faces a battle to pay his bills and mortgages without Tom’s savings and investments, life insurance policy and even the car that Tom owned but they both used.

How a Will could have helped
Had Tom got around to writing a Will, he would have been able to specify exactly who would receive what from his estate, including his savings, investments, car and other belongings. In addition to writing a Will, Tom could have made his wishes known, by nominating beneficiaries to his pension and writing life policies under trust. By taking these steps, Pete would have been given the extra financial support he now so desperately needs.

As it stands, Pete still has the legal right to claim against Tom’s estate as they had been cohabiting for more than two years - but this will be a costly and time-consuming process and a positive outcome isn’t guaranteed. If Tom had a Will, this added stress could have been avoided.

Don’t put it off
With cohabiting couple families growing faster than married couple and lone parent families, it’s clear that more people are choosing not to get married, just like Tom and Pete. However, there’s a catch. Cohabiting couples have none of the legal protections afforded by marriage, meaning that a Will is one way to ensure your partner inherits according to your wishes. Despite this, research shows three in five UK adults do not have one.

Let us help
Don’t let what happened to Pete, happen to you. Speak to a solicitor or Will writing expert to make sure your loved ones are protected.

The Will writing service promoted here is not part of the Openwork offering and is offered in our own right.

Openwork Limited accept no responsibility for this aspect of our business.

Will writing is not regulated by the Financial Conduct Authority

A positive outlook

Moving home can be a hectic and exciting time, but don’t forget about protection – taking out the appropriate policies can save you a lot of stress in the long term.

If you’ve just moved home or are about to, it probably feels like you’ve been caught up in a bit of a whirlwind over the past few months. With searching for a property during a pandemic, making the move before the stamp duty holiday ends and potentially getting caught up in the resulting conveyancing backlog, protection policies are probably not top of your priority list.

Yet it’s important to take the necessary precautions to ensure your new home and possessions are looked after – now more than ever. Here are some of the main types of protection you should be thinking about.

Mortgage protection
If you’re unable to work due to illness or injury or because you’ve lost your job, mortgage payment protection will cover the cost of your mortgage each month. These policies usually last for a year or until you return to work – whichever is soonest.

You can pick how much you want your policy to pay out each month, and this can include a buffer for other expenses, such as bills. It’s important to bear in mind though that providers usually set monthly limits of between £1,500 and £2,000. You won’t always be able to claim straight away, and there’s usually a waiting period of one or two months. The cost of mortgage protection will depend on:

• your salary;
• the size of your mortgage repayments;
• the type of policy you choose; and
• how soon you want to be covered.

Income protection
Income protection provides you with a regular income if you are unable to work due to illness or injury. There’s usually a minimum wait of four weeks before you can start receiving payments.

Buildings insurance
If you’ve got a mortgage, you’re likely to have buildings insurance to cover the cost of repairing damage or rebuilding the structure of your home if it’s damaged. But have you looked carefully through the policy and made sure that it definitely covers everything you need it to? Once you’ve moved, you may realise that your new home has a slightly more complex structure than you first realised, and it’s important to make sure your buildings insurance takes this into account. If you’re lucky enough to not have a mortgage, it’s still a sensible idea to invest in this type of insurance for peace of mind.

Contents insurance
If you’ve bought new furniture and gadgets for your home, you might need to review your contents insurance. This type of insurance covers the cost of replacing possessions in your home if they’re stolen, destroyed or damaged. It’s a good idea to double check which of your items are covered so that you’re not caught out if something does go wrong.

Act now
When you’re caught up in the excitement of moving, thinking about protection might be the last thing on your mind. But remember that your circumstances can change quickly and it’s important to make sure you’re prepared now in case things don’t go to plan in the future. For more information about protection and to talk about whether your current policies are right for your situation, speak to your financial adviser today.

The effect of the lockdown on millions of bank accounts has been to boost savings for people whose incomes have remained the same but whose spending has dropped.

With the prospect of life returning to a new normal, it’s a chance to think about how to make the most of these savings and build on them too.

 Where were savings made?

Working from home meant the cost of commuting was put on hold. Holidays were not booked, and the closure of restaurants, bars and entertainment venues cut spending in those areas, resulting in slightly healthier current accounts.

All this, the Bank of England estimates, resulted in over £125 billion saved in 2020. Its survey does note that only a fraction of this is likely to be spent by households, suggesting a cautious approach.

This is understandable given the drop in income for furloughed employees, the loss of income for the unemployed and an unstable job market.

How to invest your lockdown savings

Leaving your savings in a high-street bank account won’t build much interest. But there are options out there for those who want better returns on what they’ve saved:

• Invest in a stocks and shares ISA – not only will any dividends paid to you be tax-free, but any gains will also be exempt from capital gains tax.
• Contribute to your private pension – this comes with the benefit of tax relief status on your contribution if you’re a taxpayer.

Other ways to make the most of your savings 

Aside from investing, there are some useful ways to use any extra money saved during lockdown:

• Pay down debt – if you have lingering debts, whether they’re credit cards or student loans, consider using your extra cash to help eliminate them for good.
• Mortgage overpayments – you could make regular overpayments on your mortgage, reducing its overall term length and the amount you owe on the loan. Check with your mortgage company about their terms and conditions relating to overpayments.
• Build an emergency fund – this fund should contain enough to cover the essentials for a month (like bills, food and your rent or mortgage payments) if anything were to happen to affect your income. Consider opening a separate bank account — easily accessible to you — to store your fund.

A great place to start with all of these options is to create a budget that tracks your income every month compared to your spending, allowing you to work out how much you can put aside.

Our trusted financial advisers are here to help you find the best ways to invest your money to make the most of your savings — whatever your situation.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways

• Millions of us became accidental savers during lockdown as a result of a sharp drop in spending and incomes remaining the same.
• There are several ways to make the most of your savings, which build better returns compared to leaving your money in your bank account.

Consider using your extra savings to pay down debt or put them into an emergency fund.

Following the news that thousands more people are expected to pay the standard 40% inheritance tax this year because of the effects of the pandemic, we explore some of the ways to navigate the complexities of inheritance tax.

The complex laws around inheritance tax (IHT) caught many people off guard during the Covid-19 pandemic. Along with the often-sudden loss of a loved one came the issues arising from IHT on gifts passed down to children and grandchildren.

This tax year marks the latest in a series where the number of people being charged IHT on gifts has increased. Since 2009, beneficiaries have paid 40% IHT on estates worth more than £325,000.

 Gift your way to less inheritance tax

There are ways to avoid passing on a large IHT bill to your family, whether it’s through gifting or charitable donations:

•  You can give away assets or cash worth up to £3,000 a year (known as the annual exemption) with no IHT to pay regardless of the total value of your estate when you die.

• You can give as many gifts of up to £250 to as many people as you want each year – although not to anyone who has already received a gift of your whole £3,000 annual exemption. To make use of this exemption, it’s important to keep accurate records.

• If you are married or in a civil partnership, you can pass on your entire estate to your surviving spouse, tax free, when you pass away. Things could become more complicated, however, if your spouse was born in a different country.

• If you give a gift – of any amount – and live for a further seven years after the gift has been given, the beneficiaries will not have to pay any IHT if you pass away after that seven-year period.

Leaving money to a charity means it’s free of IHT and could cut the tax rate on the remaining amount in your estate.

Transferring to a trust or pension

Setting up a trust to transfer some of your estate into for the benefit of your grandchildren is another way to reduce the IHT liability on your assets. However, the trustees could still encounter some income or capital gains tax.

While it may not be the most obvious choice, setting up a pension for your children or grandchildren could be a tax-efficient option. The fund will transfer to them when they turn 18 but they won’t be able to access the money until they’re much older.

As with anything tax-related, the rules are especially complex when it comes to where your inheritance goes and how much your beneficiaries will end up receiving. That’s why it’s so important to speak with your financial adviser to review all your options and find the most efficient ways to pass on your wealth.

Inheritance tax facts

Following the Budget in March 2021, it was announced that thresholds will remain the same for IHT until 2026:

• For single people, the threshold is £325,000.
• For those who are married or in a civil partnership, the threshold is £650,000.
• Couples can also pass on their assets (like an owned home) worth up to £1 million in total if they leave it to children or grandchildren.

To learn more about how to make the most of your money this tax year and for more information about inheritance tax and your tax-free allowances, speak to your financial adviser.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Key takeaways

 The rise in deaths as a result of the pandemic has meant thousands more IHT payments.

• Following the Budget in March, thresholds will remain the same for IHT until 2026.
• It’s a good idea to explore ways to avoid passing on a large IHT bill to your family, such as gifting and charitable donations.

The pandemic has reportedly created 6 million accidental savers, but what’s the best way to use this extra cash?

The effect of the lockdown on millions of bank accounts has been to boost savings for people whose incomes have remained the same but whose spending has dropped.

With the prospect of life returning to a new normal, it’s a chance to think about how to make the most of these savings and build on them too.

Where were savings made?
Working from home meant the cost of commuting was put on hold. Holidays were not booked, and the closure of restaurants, bars and entertainment venues cut spending in those areas, resulting in slightly healthier current accounts.

All this, the Bank of England estimates, resulted in over £125 billion saved in 2020. Its survey does note that only a fraction of this is likely to be spent by households, suggesting a cautious approach.

This is understandable given the drop in income for furloughed employees, the loss of income for the unemployed and an unstable job market.

How to invest your lockdown savings
Leaving your savings in a high-street bank account won’t build much interest. But there are options out there for those who want better returns on what they’ve saved:

Invest in a stocks and shares ISA – not only will any dividends paid to you be tax-free, but any gains will also be exempt from capital gains tax.
Contribute to your private pension – this comes with the benefit of tax relief status on your contribution if you’re a taxpayer.

Other ways to make the most of your savings
Aside from investing, there are some useful ways to use any extra money saved during lockdown:

Pay down debt – if you have lingering debts, whether they’re credit cards or student loans, consider using your extra cash to help eliminate them for good.
Mortgage overpayments – you could make regular overpayments on your mortgage, reducing its overall term length and the amount you owe on the loan. Check with your mortgage company about their terms and conditions relating to overpayments.
Build an emergency fund – this fund should contain enough to cover the essentials for a month (like bills, food and your rent or mortgage payments) if anything were to happen to affect your income. Consider opening a separate bank account — easily accessible to you — to store your fund.
A great place to start with all of these options is to create a budget that tracks your income every month compared to your spending, allowing you to work out how much you can put aside.

Our trusted financial advisers are here to help you find the best ways to invest your money to make the most of your savings — whatever your situation.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways

• Millions of us became accidental savers during lockdown as a result of a sharp drop in spending and incomes remaining the same.
• There are several ways to make the most of your savings, which build better returns compared to leaving your money in your bank account.
• Consider using your extra savings to pay down debt or put them into an emergency fund.

As lockdown measures begin to lift, financial markets are making their adjustments in anticipation of a rise in inflation, with bond yields picking up (meaning prices have fallen) and stock markets rotating from defensive sectors into cyclicals.

What is inflation?
Put simply, inflation measures the change in the prices of goods and services. If it rises then it takes more of our cash to buy things. We all experience inflation in our daily lives, from filling up our cars with fuel, buying groceries or using public transport.

In the UK, the official measure of inflation is the Consumer Prices Index. It’s published by the Office for National Statistics (ONS), which monitors what people are spending their money on, using a basket of everyday goods and services.

The ONS adjusts the basket from time to time to reflect our changing spending habits. During lockdown, there was a shift with products like hand sanitiser and hand wipes being added, and items like white chocolate and ground coffee dropping off the list.

Inflation is all an illusion… or is it?
It’s easy to ignore the impact of inflation on your finances. Most people’s spending habits this month compared with the same time a year ago would probably stick to the same patterns – regardless of inflation at the time – because the differences seem small and therefore wouldn’t affect the way they spend.

If you’re trying to save money though, it’s worth remembering that with interest rates currently lower than the rate of inflation, the real value of any cash savings is falling. In other words, the cost of living is increasing at a faster rate than your savings are growing, which means the spending power of your money is actually falling.

How will inflation affect investments?
Many people in the UK are preparing to spend the cash they’ve saved over the past year when the lockdown ends and shops, restaurants and entertainment venues reopen. Activity is likely to return to pre-pandemic levels and the expectation is that inflation is likely to pick up. Some economists are worried about inflationary pressures. In addition to this is the effect of government stimulus packages on the economy, which would provide another tailwind.

However, experts believe it’s likely to be a short-lived phase and should not pose a longer-term challenge to fixed income or equity markets. The Bank of England does foresee inflation rising towards the 2% mark but believes it will be a temporary phenomenon. Continuing deflationary forces like ageing demographics, technological innovation and global supply chains cast doubt over predictions of a new era of inflation.

Ultimately if you want to beat inflation in terms of finding some good returns on your savings, investing is the best option at the moment – due to cash savings rates being at such low levels.

One of the best ways to ensure your investments are given the strongest opportunity to navigate the effects of inflation on financial markets is through a global, multi-asset portfolio that’s actively managed by a professional team of investors. Speak to a financial adviser to find out more.

One of the best ways to ensure your investments are given the strongest opportunity to navigate the effects of inflation on financial markets is through a global, multiasset portfolio that’s actively managed by a professional team of investors. Speak to a financial adviser to find out more.

Key takeaways

• As lockdown measures begin to lift, financial markets are making their adjustments in anticipation of a rise in inflation.
• If you’re trying to save money, it’s worth remembering that with interest rates currently lower than the rate of inflation, the real value of any cash savings is falling.
• Investing in a global multi-asset portfolio, managed by a professional team of investors, is the best way to ensure your investments are given the strongest opportunity to beat the rate of inflation.

Individual Savings Accounts (ISAs) were first introduced in 1999 and are a tax-free way to save into a cash savings or investment account. There are lots of different types of ISA available, but the right one for you will depend on your financial goals. We explain how they work so you can choose the one that is best for you.

Cash ISA
A cash ISA works in the same way as a traditional savings account but you won’t have to pay tax on any of the interest you earn.

For the 2021-22 tax year each person has an ISA allowance of £20,000. To take out a cash ISA you have to be a UK resident and over the age of 16. If you don’t use the allowance before the end of the tax year you will lose it and you’ll have to start anew on 6 April.

Some cash ISAs are instant access while others have a fixed rate. You can only open one cash ISA per year but you are allowed to transfer to another cash ISA or a stocks and shares ISA with another provider if you want to.

Stocks and shares ISAs
With a stocks and shares ISA you can hold a variety of investments such as shares, bonds and funds. Just like the cash ISA you can save up to £20,000 a year tax free, but you get to choose what investments you put inside it, so it’s worth getting financial advice. You also have to be 18 or over to be eligible.

Stocks and shares ISAs provide an option for people looking to avoid the erosive impact of inflation on returns. Over time there is the potential for better returns with an investment ISA over cash, although the risks are also greater.

If you want to invest in a stocks and shares ISA you need to be comfortable with the possibility of making losses and prepared to invest for the longer term.

Lifetime ISA
The lifetime ISA (LISA) can be used by first-time buyers to fund a deposit for a property or taken tax-free at the age of 60. As well as paying interest, LISAs benefit from a 25% bonus from the government to encourage saving towards a home or retirement.

The maximum you can put in each year is £4,000, which comes out of your £20,000 ISA allowance. The LISA can only be opened by anyone aged 18–39, but you can keep saving in one until you are 50.

With the LISA, you can get a bonus of up to £1,000 a year up until you are 50. If you open one at the age of 18, this means you could end up with a maximum bonus of £32,000.

However, there are some restrictions with a LISA. You have to keep your money in a LISA for a minimum of one year before you can withdraw it and if you take your money out before you are 60 and you don’t use it to buy a home, you will have to pay a 25% penalty.

Junior ISAs
If you're looking to put some cash aside for your kids, Junior ISAs (JISAs) are a great way of doing so. These accounts are available to anyone under 18 and tend to offer much higher rates than adult accounts, but there are some restrictions.

Like the adult accounts, you won’t pay any tax on your interest. In the 2019–20 tax year you can save or invest up to £9,000 in a JISA. You can save for your child either in a cash JISA, a stocks and shares JISA, or a combination of the two. JISAs can be opened by parents with children aged under 16 and then by children themselves when they are aged 16 and 17.

Innovative Finance ISA
If you invest with an innovative finance ISA (IFISA) the company offering the ISA will use the money to lend to borrowers or businesses – known as peer-to-peer lending. You’ll be offered a rate of interest from the borrower when paying back the money you’ve invested.

You can invest up to £20,000 a year in an IFISA and any interest earned will not be taxed. While you can earn higher rates of interest than with a traditional savings account, they are a much riskier option than a cash ISA as the borrower could potentially default on their loan.

Our financial advisers can help you and your family find the right product to suit your needs and financial situation.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Key takeaways

• Stocks and shares ISAs and innovative finance ISAs are riskier than cash ISAs and you could lose money, so make sure you get financial advice if you are considering either of these options.
• You can save up to £20,000 a year tax-free in an ISA, but if you don’t use your full allowance you’ll lose it when the new tax year starts.
• If you’re a first-time buyer saving for a house you could get a government bonus of up to £1,000 a year to put towards a deposit if you pay in the annual maximum of £4,000. 

With inflation climbing and interest rate rises on the horizon, Britain is at a critical period in terms of its economic future. Multiple lockdowns caused the UK economy to slump by 10% while the government spent more than £100 billion supporting jobs.

Now the economy is recovering the chancellor is under increasing pressure to balance the books and claw back money spent on fighting the Covid crisis. Policies include:

The National Living Wage will rise for those aged 23 and over to £9.50 an hour.
Planned rises in fuel duty have been cancelled amid the highest pump prices in eight years.
A 50% business rates discount for firms in the retail, hospitality, and leisure sectors up to a maximum of £110,000.

Cost of living
After coming under pressure to help employees, especially younger workers who have been some of the worst hit by the pandemic, the government is raising the National Living Wage for those aged 23 and over to £9.50 an hour. The chancellor also ended the one-year freeze on public-sector pay, introduced to control the deficit at a time when the economy was shrinking.

The Universal Credit taper rate – the amount of every £1 lost when someone takes on work – will be reduced by 63% to 55%. This means those claiming the benefit will take home more money each month.

As previously announced, a £500 million Household Support Fund will be made available to local councils in England and distributed to members of the community. The fund aims to help the most vulnerable with basic household costs such as food, clothing, and utilities.

A planned increase on spirits, beer and wines duty will be cancelled. The system of alcohol duties will also be simplified, with drinks taxed in proportion to their alcohol content. The planned fuel duty rise will be cancelled and will remain frozen at 57.95p a litre until next year.

Green energy surcharges will be moved from electricity bills on to gas bills to help nudge customers to lower-carbon alternatives. The move will affect customers who have traditional gas boilers and be phased in over the next 10 years.

The chancellor also said flights between England, Scotland, Wales, and Northern Ireland will have a lower rate of Air Passenger Duty from April 2023.

Taxes and allowances
As previously announced, the national insurance contribution rate (NIC) will rise by 1.25% from April 2022. The plans are designed to help raise £12 billion for social care and the NHS. National insurance rates will return to their current levels in April 2023 and a social care levy of 1.25% will be introduced to replace it. Unlike national insurance, this will also be paid by pensioners who are still working.

Dividend tax rates will also rise by 1.25% from April next year, which means investors will have to pay more on their earnings. Basic rate income taxpayers will pay 8.75% with higher rate taxpayers charged 33.7%. Despite fears of a shake-up of capital gains tax (tax on the profit you make when you sell an asset that has increased in value), this failed to materialise.

Business and investment
Firms in the retail, hospitality and leisure sectors will be able to claim a new 50% business rates discount on bills of up to a maximum of £110,000 for the next 12 months. A new business rates improvement relief will allow businesses to make property improvements from 2023 for 12 months at no extra charge. There will also be more frequent revaluations of business rates every three years from 2023 and relief for business owners who adopt green technology like solar panels.

The government will launch a £1.4 billion fund to attract more overseas investment into the UK economy, particularly in sectors such as life sciences and electric vehicle production. The chancellor also outlined investment plans to attract highly skilled foreign workers and change regulations to make it easier for foreign companies to relocate to the UK.

The tax surcharge on bank profits has been cut from 8% to 3% to help boost London’s competitiveness as a financial centre. The change will come into effect in April 2023 and means banks will pay 28% tax. It is intended to act as a countermeasure to the planned hike in corporation tax for the UK’s largest firms from 19% to 25%. The chancellor has also pushed back the goal of reaching £22 billion in annual research and development (R&D) spending by two years to 2026/27.

Housing and infrastructure
The government confirmed £11.5 billion would be set aside to build 180,000 affordable homes. This includes 160,000 new homes which will be built on derelict or unused land – also known as brownfield sites – in England. A further £65 million has been allocated to ramp up England’s planning system, including digitisation to make local plans easier to access.

English regions have been given a total of almost £6.9 billion to improve urban transport across England. The money will go towards regions including Greater Manchester and the West Midlands, funding projects designed to boost sustainable transport, as well as improving bus and train services. The chancellor also announced the allocation in the first round of bids from the Levelling Up Fund, giving £1.7 billion to invest in the infrastructure, transport, and regeneration of over 100 local areas.

What does this mean for investors?
While the budget is unlikely to have a huge impact on the UK’s recovery it will allow room for the government to cut taxes before the next election.

Robert Jeffree, chief investment officer of Omnis Investments, says: “Today, Rishi Sunak received three gifts from the independently managed Office of Budget Responsibility (OBR). First up, the growth forecast for 2021 has been raised from 4% to 6.5% and is expected to reach 6% in 2022. Secondly, the forecast for economic scarring from the pandemic has been downgraded from 3% to 2%. Last but not least, the OBR forecasts government borrowing to decrease from 7.9% this year to 3.3% next year and then fall further from there. This is positive for gilts (the UK’s government bonds) and we have already seen yields on gilts fall following the budget (prices of bonds rise as yields fall).

“Overall, this felt like an upbeat Budget that attempted to tread a fine line between spending the three gifts granted to him by the OBR while, leaving enough room for the classic Conservative’s strategy of cutting taxes before the next election. The Budget doesn’t change the path of the UK’s economic recovery, but at the margins attempts to level up the recovery in those harder hit areas.

“Finally, despite targeting universal credit, the Budget does little to address the increased cost of living we can expect in the UK going into next year, the sticky inflation and the expected interest rate hikes from the Bank of England.”

Mike Morrow, chief commercial officer at The Openwork Partnership, says: “The good news from the Budget for advisers is very much about what was not announced.

“Capital gains tax was left alone for now and there were no major announcements on pensions despite speculation that the lifetime allowance and the annual allowance could have been cut as well as the usual rumours about higher rate tax relief being replaced by flat rate tax relief.

“There was some good news for savers with the launch of Green Savings Bonds from National Savings & Investments, which go on sale on Friday although the rate at 0.65% isn’t that tempting. Low earners will benefit from the abolition of a tax anomaly, which means anyone earning less than the personal allowance threshold who save into a pension through a net pay arrangement doesn’t receive a tax bonus on their contributions. From 2024/25 they’ll be eligible for a 20% tax top-up from the Treasury at the end of the tax year which helps encourage saving.

“The chancellor stressed how he was committed to cutting taxes by the end of the Parliament, which is good to hear but we should not forget that he is raising taxes from next year with a 1.25% increase in national insurance for employed and self-employed people plus a rise in dividend tax too.

“On top of all of that he confirmed that inflation is set to hit 4% next year which will hit everyone’s savings. Financial advisers will have their work cut out supporting clients but there will definitely be a lot of demand for their expertise.”

Many fixed mortgage deals will be approaching the end of their term this October, so it’s a good idea to review your buy-to-let mortgage.

With interest rates still at low levels and demand for rental properties increasing around the country, investing in a buy-to-let (BTL) is a popular choice for many.

Buy to let basics

A BTL mortgage is a specific type of product for those who want to buy a property with the intention of renting it. Because of this, there are different terms and rules around a BTL mortgage (compared to a regular mortgage for a property the buyer intends to live in.)

With a BTL mortgage, the anticipated rental income is taken into account when the lender calculates how much you can borrow.

A BTL mortgage could suit investors with enough equity to put down a deposit of at least 20% of the value of the property (but some lenders could require up to 40%.)

Your credit record is closely scrutinised with a BTL mortgage, as with a regular mortgage application.

Interest rates for BTL mortgages are usually higher than a regular mortgage.

Things to remember

If you have a BTL mortgage already and its fixed interest rate term is coming to an end, you may be thinking about switching products or providers to gain a better deal.

Here are some other things to look out for:

• Examine all of your options into the type of product to suit your investment going forward. A financial adviser is best placed to help you with this.
• Don’t forget to research any fees and charges around changing your product too, as these could be higher than you expect.
• When changing products, you may be asked about your property’s rental income history in order to assure any new lenders that you are able to keep up with mortgage payments.
• Show that you have sufficient savings to cover any gaps in rental periods when your property could be unoccupied.
• For your own peace of mind, having a cushion of savings available to cover any essential repairs is important.
• If you are looking to remortgage your BTL property or are thinking about transferring your mortgage to a different provider, our advisers can help you find a product that best suits you.

Some buy to let mortgages are not regulated by the Financial Conduct Authority.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE

Key takeaways
Many fixed mortgage deals will be approaching the end of their term this October, so it’s a good idea to review your BTL mortgage.
BTL mortgages come with different terms and rules than a regular mortgage.  It’s important to research all of your options when changing BTL mortgage products. A financial adviser is best placed to help you with this.

You might be thinking about whether to invest in crypto currencies. We explain why it may not be the right choice, and how to better approach your portfolio.

This year has been eventful for bitcoin, with the cryptocurrency reaching a record high and then almost halving in value all in the space of six weeks. The walk-back in May from Tesla’s Elon Musk in his support of bitcoin underlined concerns around the idea of cryptocurrencies as a stable investment. Musk – previously an outspoken supporter – announced his company would not be accepting bitcoin as payment for its vehicles.

What followed was a series of plunges in its value – not helped by the additional news of Chinese regulators signalling a crackdown on the use of digital currencies.

Bitcoin in brief
Bitcoin is a type of digital, decentralised currency, allowing the transfer of goods and services without the need for a trusted third party. The network is based on people around the world called ‘miners’ using computers to solve complex mathematical problems in order to verify a transaction and add it to the ‘blockchain’ – a massive and transparent ledger of each and every bitcoin transaction maintained by the miners. The first to verify is rewarded with bitcoin. There is a finite amount of bitcoin that can be produced and, as more are created, the mathematical computations required to create more become increasingly difficult.

Cryptocurrencies can be volatile
Bitcoin’s high volatility (risk) makes it a poor substitute for money in a broad sense. The unsteady air around cryptocurrencies in May showed the speculative nature of this asset class. Bitcoin and cryptocurrencies, in general, have more in common with commodities and currencies – they are much harder to value than cashflow-producing equities and bonds.

Reasons to be crypto cautious
Cryptocurrencies are a volatile choice and susceptible to stock market bubbles, which can affect investments negatively during a downturn.

They’re not a tangible form of investment and are not regulated, which can be a red flag when it comes to your investments.

Volatility means investors are likely to act on doubts and sell if they fear a fall in return.

Where to invest?
A sensible approach is to invest in high-quality companies that are well-established businesses.  These are usually businesses with strong management teams, serviceable levels of debt and predictable cash flows. To avoid being hit by market volatility make sure your portfolio is invested in a wide range of assets, and less vulnerable to market shocks.

Staying invested when there is a downturn can help you get through any turbulent times and put you in a good position to benefit from any ensuing recovery.

Our financial advisers can help advise you on your investment choices.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways
This year has been eventful for bitcoin, with the cryptocurrency reaching a record high and then almost halving in value all in the space of six weeks.

Bitcoin’s high volatility makes it poorly suited as a substitute for traditional forms of money.

A sensible strategy is to invest in high-quality companies that are well-established businesses.

Host Aimee Lungutescu, is joined by Penny Group’s Sanjay Assarpota, Cavendish Brooke’s Jack Spiers and Blue Heron’s Rebecca Harbrow. The group discuss what it takes to build a successful career in financial advice – including building and maintaining a client bank, as well as tips for young advisers in the early stages of their career.

Listen to the podcast here

To keep your investments from losing value or slowing the growth of your assets, avoid these common investing mistakes.

There are more risks and opportunities than ever for investors to navigate in today’s rapidly evolving markets. Here are four approaches we believe every investor should follow.

Don’t pile into cash – stay invested
The biggest advantage of cash is that it offers relative safety. Cash can help diversify a portfolio during times of volatility and is easy to access in an emergency. With cash, you’ll be paid interest on the money, which will be tax-free where it’s in an ISA.

You won’t lose any money by putting your money in cash, but it tends to offer lower returns than other asset classes. It’s also important to know about the impact of inflation on your savings and investments as it can make a huge difference to how much profit you make. Cash is seen as a short-term safe haven and should not be held over a substantial period of time to avoid the impact of inflation.

While it’s good to have some cash savings for a rainy day, the spending value of your money can fall over time if inflation is higher than the interest rate you receive. With interest rates on cash investments at historically low levels, and well below the inflation rate, millions have seen the value of their savings eroded in recent years. To make money on your investment you’ll need to find an account or investment that gives you a greater return than the current rate of inflation.

Don’t go chasing fads – think about the long term
Short-term gains can seem appealing for investors, but if you don’t want to lose your savings, it’s best to not believe the hype about the latest investment craze. Choosing the wrong investment can be a costly mistake. Many investors are turning to social media platforms such as Facebook, Twitter, YouTube, TikTok and other unregulated sources for information about investing.

While it may seem tempting to get investment recommendations this way, it puts you at significant risk from volatile stocks or even fraud. It’s easy to jump on the bandwagon, but momentum is typically falling by the time most people join.

Don’t put all your eggs in one basket – diversify
One of the biggest mistakes when investing is putting all your eggs in one basket as it can leave you exposed to fluctuations in the market. If you’ve invested in one stock and something unexpected happens and it plummets, you could find your nest egg suddenly disappearing.

One way to lower risk is by spreading your wealth over a wider range of investments so it’s not concentrated in one place (known as diversification). By diversifying your portfolio, you can reduce the risk that all of your investments will experience the same negative impact at the same time.

Ideally, you should be looking to build a diverse portfolio with a mix of different investments in line with your attitude to risk. A balanced portfolio will contain a mixture of asset classes, such as stocks, bonds, and alternatives.

Sit tight when it’s right
When markets wobble it can be tempting for investors to sell their shares to avoid any further losses. It’s easy to react to short-term losses but the best thing you can do is most often precisely nothing.

Timing the market involves buying and selling investments when you think they will rise or fall at exactly the right moment. It’s a difficult strategy that rarely works and there are too many unpredictable factors.

If you sell into a falling market you will lock in your losses and it could take you years to get back to where you were. While markets can fall sharply, given time they can rebound, so instead make sure you take the long view. Stock markets have a history of recovering from downturns. If you see your investment drop, don’t worry. Just keep your cool and sit tight.

It pays to seek advice
A financial adviser can help you work out how to achieve your long-term financial goals while taking inflation into account so it doesn’t eat up your returns. Your adviser will speak to you about your attitude towards risk and the level you are comfortable with, helping you make the right investment choices.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways

• While you won’t lose any money by putting your money in cash, it tends to offer lower returns than other asset classes, so it makes sense to stay invested.
• Don’t put all your eggs in one basket. Diversifying your portfolio can help reduce investment risk.
• If you sell when the market falls you’ll lock in your losses. Markets always rebound, so make sure you stay invested.

How easy have you found managing your personal and business finances over the last two years?

Are you confident that you know the best strategies for managing your personal and business finances?

To celebrate International Women’s Day, Cindy and Rebecca have come together to share simple strategies you can use to shockproof your personal and business finances. Cindy and Rebecca have over 40 years of experience of advising and guiding their clients through challenging and uncertain circumstances.

Click on the link to register.

Cindy and Rebecca look forward to seeing you on 8th March 2022 at 12:00 noon.

In the Financial Lives 2020 survey from the FCA, it has been found that older adults were more likely to hold a savings account of any type, than younger adults. For example, 83% of those aged 55+ did, compared with 63% of 18–24-year-olds. So, how could an ISA help you?

ISA
An ISA is an individual savings account that allows you to save tax-free money in a cash or investment account, so you could end up getting more for your money. An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth, income, or both. There are a few different types of ISAs including, Cash ISA's and Stocks and Shares ISA's. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Cash ISA
A Cash ISA is a tax-free savings account where you can deposit up to a yearly limit and pay no tax on the interest that you earn. There are three principal types of cash ISA: Instant Access, Regular Savings and Fixed rate. Anyone over the age of 16 can open one cash ISA in each tax year with as little as £1. Although Cash ISAs can be a good way to start your investment journey, they can have their drawbacks. If you find yourself with low interest rates and high inflation, this can lead to poor rates and therefore eroding value.

Stocks and Shares ISA
A stocks and shares ISA, also known as an investment ISA, is a tax-efficient investment account that can help make your money work harder. Unlike a cash ISA, a stocks and shares ISA gives your money more potential to grow by investing it in a range of places like shares, funds, investment trusts and bonds, instead of keeping it in cash. It’s a smart way to protect your money from being taxed, as you won’t pay a penny in capital gains, tax, or income tax on any profits you make in the future. So, whether you’re saving for a holiday of a lifetime, a property deposit, or simply for a rainy day, switching to a stocks & shares ISA could give your savings the boost they need to meet your financial goals.

Don’t forget to use your 2021-2022 allowance before the end of 5 April 2022. 

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

At the start of 2020, the World Bank issued a warning that the global economy faces a variety of challenges, including new Covid variants, high inflation and an uncertain geopolitical landscape. Its economists lowered their growth forecasts and suggested that some richer countries might not reach pre-pandemic levels of output until 2023, with poorer ones taking longer.

Central bank monetary policies are another uncertain factor. After the US Federal Reserve (Fed) said it could raise interest rates multiple times this year and sooner than expected – to curb inflation – stock markets dropped in early January. The Fed is worried that inflation could spiral out of control, and a strong labour market has added to these pressures.

Stocks in the technology sector were among the hardest hit. The Nasdaq Index had its worst start to a new year since 2008 and European technology shares fell too. By the middle of January, conditions had stabilised, with investors reassured by the Fed’s announcement that it would tackle the surge in inflation. However, tech share prices suffered again towards the end of the month.

Inflation soars
The annual rate of inflation in the US jumped to 7%, which is its highest level since June 1982. Several factors are sustaining rising prices, with energy costs the largest contributor. In the UK, figures released in January showed inflation at a 30-year high, increasing pressure on the Bank of England to raise rates. The euro area’s annual inflation rate crept up to 5%, another record high for the currency bloc. Energy prices were again the main factor.

Yet the underlying investment environment remains buoyant with the global economy continuing to expand, and while the rate of growth has slowed, it is still doing so at a decent pace, and companies are delivering good profits growth. Notably, the UK’s economy has already recovered to its pre-pandemic level following a strong period of growth in the last few months of 2021, due in part to early Christmas shopping and an increase in dining out in November. This was, of course, before the Omicron variant of Covid became prominent in the UK.

China’s economy has been suffering from a variety of pressures, including a heavily indebted property sector, and it slowed at the end of 2021, which prompted a cut to one of its key interest rates. However, full-year growth was 8.1%, exceeding the government’s target of 6% and rebounding from the 2.2% growth registered in 2020. With much of the world dependent on Chinese exports, the country posted a record trade surplus of $676 billion in 2021 – the highest since 1950.

The triumph of tech
With so many aspects of our lives shifting online during the lockdowns and ongoing digitalisation trends, it’s not surprising that the technology sector often dominates the headlines. Notably, Apple became the first company to reach a market value of $3 trillion. The company’s share price has more than tripled since the depths of the pandemic in March 2020.

Meanwhile, Microsoft announced a massive $69 billion deal to buy the game's publisher Activision Blizzard. The move shook the gaming industry and after news of the acquisition, rival Sony saw a $20 billion drop in its market value. The deal promises to turn Microsoft into one of the world’s biggest interactive entertainment players.

Key takeaways

• Figures released in January showed levels of inflation in the UK and US that have not been seen in decades.
• The UK’s economy recovered to its pre-pandemic level following a strong period of growth over the Past few months.
• Apple became the first company to reach a $3 trillion market value and Microsoft announced a $69 billion deal to buy games publisher Activision Blizzard

Living costs have soared since Covid-19 restrictions were eased and the Russian invasion of Ukraine has pushed gas and fuel prices up further. The annual rate of inflation jumped to a 30-year high of 6.2% in February, up from 5.5% in January. Inflation had been predicted to begin levelling off this year, but with the impact of climbing energy and food prices it now looks set to run higher and for longer.

Families across the UK are now facing a cost-of-living crisis, putting chancellor Rishi Sunak under significant pressure to help bring household bills down in this year’s Spring Statement. Policies include:

• The National Insurance threshold is being raised by £3,000 to £12,570.
• Fuel duty is being reduced by 5p in order to counter record prices at the pumps.
• The basic rate of income tax will be cut from 20p to 19p in the pound by 2024.

Tax and wages
The National Insurance threshold has been increased by £3,000 so people will now start paying the levy on income over £12,570 from July 2022. The chancellor also announced that the basic rate of income tax will be cut from 20p in the pound to 19p before the end of Parliament in 2024.

The government has resisted pressure to scrap a planned 1.25 percentage point increase in National Insurance contributions. National Insurance will go up by 1.25 percentage points to 13.25% in April – a rise of 10.4% – which will raise £12 billion a year for health and social care.

Experts have warned that the increase in National Insurance will put further pressure on families that are already struggling with rising bills. The rise will add an extra £255 to the tax bill for someone earning £30,000 a year and £505 to someone earning £50,000 a year.

Fuel duty
With fuel bills rising, the chancellor announced that he is reducing the levy on petrol and diesel by 5p. Russia’s invasion of Ukraine has sent fuel prices soaring to record highs in recent weeks, squeezing household budgets even further.

The average price of petrol is now £1.66 per litre for petrol and £1.77 per litre for diesel, costing about £85 to fill up a family car, according to the RAC. Fuel duty is currently 57.95p per litre for petrol and diesel, with VAT at 20% charged on top of the total price.

Climate and energy
The chancellor announced that he is cutting VAT on energy saving materials to help households improve energy efficiency and save money on bills. For the next five years, homeowners will pay 0% instead of 5% VAT when installing solar panels, heat pumps or insulation.

The chancellor revealed his plans to double the government’s household support fund to £1 billion for those affected by higher energy costs. The Household Support Fund is managed by local councils and assists households that are in financial difficulty by giving them short-term support.

Business and technology
The chancellor increased the employment allowance (a relief which allows smaller businesses to reduce their employers' National

Insurance contributions bills each year) from £4,000 to £5,000. There will be no business rates due on a range of green technology used to decarbonise buildings, including solar panels and batteries, while eligible heat networks will also receive 100% relief.

The chancellor said he will examine how the tax system can be used to encourage employers to invest in adult training. The Treasury will also consider whether to make research and development expenditure more generous.

What does this mean for households?
Robert Jeffree, chief investment officer of Omnis Investments, says: “Chancellor Rishi Sunak delivered a high-pressure Spring Statement today. Data released earlier in the day showed inflation has raced to 6.2% in February, and people are facing higher bills, including energy costs, petrol prices and a National Insurance hike.

“Mr Sunak unveiled a few measures to support households – the main one being an immediate £3,000 increase in the threshold for National Insurance contributions. He also reduced fuel duty by five pence per litre, cut the rate of VAT on energy-saving home improvements to zero and made an extra £500 million available for housing support. While this does go some way to tackle the rising cost of living, it does not go far enough, and rising costs will continue to squeeze disposable income.”

The cost of living crisis
The UK is in the grip of a cost-of-living crisis, with energy bills, the price of food and other essentials soaring. Inflation was already rising as a result of the surge in demand following the easing of Covid-19 restrictions and supply chain issues. Russia’s invasion of Ukraine and the resulting economic sanctions have exacerbated the problem, pushing prices even higher.

Things look set to get worse for households, which will face a record energy bill increase of 54% from April after the regulator lifted the default tariff cap to £1,971. The Bank of England has warned that inflation could hit 8% in the spring and could go even higher later this year.

In February, the chancellor announced plans to give millions of households a £200 discount on their energy bills (to be repaid at £40 a year) and a council tax rebate of £150 in England and Wales. If prices rise too high consumers could be put off spending, which could hurt economic growth. Higher costs may also put off businesses from investing.

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As the end of the tax year approaches, there’s still time to take advantage of your annual tax-free allowances if you’ve not already done so. This is one of the best ways to make your money work harder and grow, especially with interest rates on the rise. We can guide you through the best ways to use your allowances – depending on your needs.

ISAs
The maximum you can invest across your ISAs (if it’s a cash ISA, stocks and shares ISA or innovative finance ISA) is £20,000. For a lifetime ISA the annual allowance is £4,000.

Pension allowance
Your personal pension contribution allowance is £40,000, although it can be lower for higher earners and where pension savings have been flexibly accessed already. Any contributions you (or your employer) make receive tax relief from the government (based on your income tax band) of 20% or more – and the money in your pension pot will grow tax free.

Gift allowances
A financial gift is a great way of using tax-free allowances for any extra cash, and your adviser will be able to talk you through the options available, which could include:

Junior ISAs
If you’re looking to put some cash aside for your children, Junior ISAs (JISAs) are a great option. In the current tax year you can save or invest up to £9,000 in a JISA. You can save for your child in a cash JISA, a stocks and shares JISA or a combination of the two.

Child’s pension
A child’s pension can be set up by a parent or guardian, but anyone can contribute. You can pay up to £2,880 in the current tax year into a pension on behalf of a child and the government automatically tops this up with 20% tax relief on the total amount contributed, taking the figure up to £3,600.

Cash gifts
Making a cash gift can help a loved one (and help with your estate planning). Everyone has an annual gifting limit of £3,000 that is exempt from inheritance tax (IHT). This is known as your annual exemption. If you fail to use it one year, you can carry it over to the next tax year (so if you didn’t use the gift last year you could give away £6,000).

It’s worth remembering that any gift you give, even to family members, could be subject to capital gains tax (CGT). CGT is the tax you pay on any profit or gain you make when you dispose of an asset, such as a second home or shares. If you gift an asset and it has risen in value compared to what you have paid for it, you could be liable to CGT. The current CGT allowance is £12,300. This is the amount of profit you can make before CGT is applied.

Marriage allowance
If you are married you might be able to take advantage of the marriage tax allowance. It allows one half of a couple who earns less than the income tax threshold (£12,570) to transfer up to £1,260 to their higher-earning spouse (who must be a basic rate taxpayer).

Our financial advisers can help you make the most of your annual allowances and lay out what is available to you, before the end of the tax year.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

As promised, our Spring Statement Report 2022 is now available, containing more comprehensive detail on all of these changes and announcements.

Alongside this, our Tax Tables leaflet left provides you with a quick reference guide. 

The new tax year on 6 April 2022 is a great time to review your finances.

The new tax year means annual allowances are reset and ready to be reused – to help you make the most of your money. This year more than ever, with interest rates and inflation on the rise, it’s a great time to review your pensions and investments with your adviser.

Note: The following figures apply to the 2022/2023 tax year, which starts on 6 April 2022 and ends on 5 April 2023.

ISAs
The maximum you can invest across your ISAs is £20,000 (if it’s a cash ISA, stocks and shares ISA or innovative finance ISA). For a lifetime ISA, the annual allowance is £4,000.

Junior ISAs
If you’re looking to put some cash aside for your children, Junior ISAs (JISAs) are a great option and often come with higher interest rates. In the new tax year, you can save or invest up to £9,000 in a cash JISA, a stocks and shares JISA, or a combination of the two.

Pension allowance
Your personal pension contribution allowance is £40,000, although it can be lower for higher earners and where pension savings have been flexibly accessed already. Any contributions you (or your employer) make receive tax relief from the government (based on your income tax band) of 20% or more – and the money in your pension pot will grow tax free.

Child’s pension
A child’s pension can be set up by a parent or guardian, but anyone can contribute. You can pay up to £2,880 in the new tax year into a pension on behalf of a child and the government automatically tops this up with 20% tax relief on the total amount contributed, taking the figure up to £3,600.

Gift allowances
A financial gift is a great way of using tax-free allowances, and your adviser can help explain the options available.

Making a cash gift can help a loved one (and help with your estate planning). Everyone has an annual gifting limit of £3,000 that is exempt from inheritance tax (IHT). This is known as your annual exemption. If you fail to use it one year, you can carry it over to the next tax year.

It’s worth remembering that any gift you give, even to family members, could be subject to capital gains tax (CGT). CGT is the tax you pay on any profit or gain you make when you dispose of an asset, such as a second home or shares. If you gift an asset and it has risen in value compared to what you have paid for it, you could be liable to CGT. The CGT allowance for the new tax year is £12,300. This is the amount of profit you can make before CGT is applied.

Marriage allowance
Married couples or those in civil partnerships may be able to share their personal tax allowances. To be eligible, one partner must earn less than the Personal Allowance threshold of £12,570, and the other must be a basic rate taxpayer. The lower earner can transfer £1,260 of their tax-free allowance to their partner, reducing the tax paid by up to £252 a year. Our financial advisers can help you make the most of your annual allowances now that we are into a new tax year.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key Takeaways:

• A new tax year means annual allowances are back to zero and ready to be filled or topped up, to make the most of your money.
• The maximum you can invest across your ISAs is £20,000.
• Your pension contribution allowance for the new tax year is £40,000.
• The Capital Gains Tax allowance is £12,300 for the 2022/2023 tax year.
• A financial gift is a great way of using tax-free allowances, and your adviser will be able to help talk you through the options available.
• Married couples or those in civil partnerships may be able to share their personal tax allowances.

A financial adviser can help with your investment goals, but they can also offer many more ways to understand and make the most of your money.

You might think that people who use financial advisers are just investing in the stock market or need someone to manage their portfolios. But a financial adviser can do a whole lot more.

Different types of financial advice
For an adviser, it’s their aim to help you achieve your financial goals, but that doesn’t just cover building wealth through investment – their expertise can apply to everything from mortgages to life insurance, pensions, saving for retirement or handling an inheritance. Advisers can vary in what they specialise in, and fall under a large umbrella of services including:

Pensions
You may have several workplace pensions that you’d like to consolidate, or you could have questions about drawing an income from your pension. Whatever your circumstances, a financial adviser can examine the details within your pensions to guide you on how to approach them, considering how much you will need to live comfortably when you retire.

Tax
You might think that there is little difference between Another area where expert help is needed is tax. From inheritance tax to capital gains tax or working out how much you should be paying (and if there are ways to minimise your tax bill) – is tricky. With the help from an adviser, you can become more tax-efficient and make the most of any tax breaks available to you. An adviser is best placed to help minimise your tax bills and get you the best returns.

Inheritance
An adviser can help you with leaving a legacy – an important part of planning the future of your estate and making sure your wishes are carried out when the time comes, and your wealth is passed tax efficiently. This advice could range from inheritance tax mitigation to making or updating your will.

Mortgages
Mortgages can be a tricky area, whether you’re a first-time buyer, searching for the best remortgage deal or looking for an investment property. A financial adviser can help you navigate the process, find the right type of mortgage and map out how your mortgage will work over the years (and when it could be a good time to review your mortgage). They’ll also be able to let you know your tax obligations if your property is an investment.

Investment
A financial adviser can help you navigate the world of investing safely, helping you take your first steps in investing or reviewing and managing your existing investments, as well as making you aware of any risks along the way and making sure you keep focused on the long-term goals through any market highs and lows. Our advisers have a broad breadth of experience and take an objective approach – offering ongoing advice and expertise – both of which are crucial to seeing your investment and retirement objectives come to fruition.

Our financial advisers are here to help you make sense of your finances, build, and manage your wealth and protect what you have going forward – to the benefit of you and your family.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE

Key takeaways

• Financial advisers have expertise in areas from mortgages to pensions to saving for retirement or handling an inheritance.
• With the help from an adviser, you can become more tax-efficient and make the most of any tax breaks available to you.
• A financial adviser can help you manage your investments and stay focused on your long-term objectives.

If you’re selling certain assets of high value or a second property, you’ll probably have to pay capital gains tax on your profits. Here’s how it works.

Capital gains tax (CGT) is a tax on the profits earned from selling an asset or a property belonging to you (excluding your main residence). You only pay CGT on your overall gains above your tax-free allowance – known as the ‘annual exempt amount’. In the 2021/22 tax year this amount is £12,300, so you can make this much in profit before you pay any tax. Married couples or those in civil partnerships can double this to £24,600 by pooling their allowances together. The government announced in its 2021 March Budget that these levels have been frozen until 2026.

Depending on your income tax band, you will pay the following levels of CGT when you sell an asset or property: 

• Basic rate taxpayers
• The CGT to pay on assets is 10%
• The CGT to pay on property is 18%
• Higher/additional rate taxpayers
• The CGT to pay on assets is 20%
• The CGT to pay on property is 28%
• Difference between assets and property
• CGT affects assets and property differently when it comes to how much you’ll pay:

Assets

An asset could be a piece of art, jewellery, or an antique to name a few – but several assets are exempt from CGT, such as your family home, any personal belongings worth less than £6,000 or a car that is for personal use. Investments are assets, and if you’re selling things such as shares, funds, investment trusts or other financial products you will be charged CGT if you go over your annual allowance (depending on your tax band).

Property

You will have to pay CGT if the property you are selling is a second home or a source of rental income. CGT needs to be paid within 30 days of completion of the sale or disposal of the property. You won’t pay any CGT on the sale of your main residential home, providing that it’s never been used for business purposes while you’ve lived in and owned it, and it covers less than 5,000 square meters (including the grounds).

There are rules around CGT if you live in the UK but are selling an asset or a property abroad (you may be liable to pay CGT on gains made from the sale). It’s worth getting advice about a sale abroad if this affects you.

When is CGT not required?

You won’t need to pay CGT on a gift to your spouse or civil partner, or to a charity. You’re also not required to pay CGT on certain financial assets, including gains made from ISAs or PEPs (the forerunner of ISAs), UK government gilts, Premium Bonds and winnings from betting, pools, or lotteries.

Working out your CGT

Calculating CGT can be confusing, as you will need to have the details for each capital gain or loss, along with information about the costs involved in the sale and what you received for each asset. You’ll then have to factor in your income tax band and the percentage of CGT you’ll have to pay on the gains you’ve made.

Because it’s so complex, a financial adviser is best placed to help you get this all done easily. They will also be aware of any tax reliefs you may be entitled to claim during the calculations, or whether there are ot

her ways to reduce or eliminate your CGT (like gifting to your spouse or civil partner).

Our advisers can help you make sense of any CGT affecting you and your assets, helping you to arrange your investments in the best way to make the most of their potential, including when you sell them.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

For specific tax advice please speak to an accountant or tax specialist.

Key takeaways

• CGT is a tax on the profits earned from selling an asset or property belonging to you.
• Married couples or those in a civil partnership can pool their exemption allowances together to £24,600.
• Calculating CGT is complicated, so it’s a good idea to get assistance from a financial adviser who may also be able to help you find ways to reduce your eventual CGT bill.

1 April

National Living Wage (for age 23+) rises from £8.91 to £9.50

National Minimum Wage rises to £9.18 (for 21-22-year olds), £6.83 (for 18-20-year olds), £4.81 (for 16-17-year olds) and £4.81 (for apprentices under 19 or in the first year of their apprenticeship).

Council tax bills rise by up to 2.99% (including a 1% social care precept) although there may be some regional variations.

The Energy Price Cap increases by 54% as announced by Ofgem in February. Those on default tariffs paying by direct debit will see an increase of £693 from £1,277 to £1,971 per year. Prepayment customers will see an increase of £708 from £1,309 to £2,017.

Households in Council Tax bands A-D in England will receive £150 Energy Bills Rebate on their council tax bill to help protect them from rising energy costs. Discretionary funding will also be provided to support those in Council Tax bands E-H or those on low incomes who don’t pay council tax.

Reduced VAT rate of 12.5% on suppliers of hospitality, holiday accommodation and attractions, reverts to the standard rate of 20%.

5 April

End of the 2021/22 tax year. Have you used all your allowances?

6 April

Start of the 2022/23 tax year

ISA allowance remains at £20,000 (if it’s a cash ISA, stocks and shares ISA or innovative finance ISA) and £4,000 (for a lifetime ISA)

Junior ISA allowance remains at £9,000 (for a cash JISA, stocks and shares JISA or a combination of the two)

National insurance contributions paid by workers increases by 1.25%.

11 April

State Pension and benefit rates rise by 3.1% in line with the Consumer Price Index. This means the basic State Pension increases to £141.85 per week and the full rate of new State Pension increases to £185.15.

Standard Lifetime allowance for tax free pension saving remains at £1,073,100 until the 2025-26 tax year.

Personal tax allowance remains at £12,570. The basic rate threshold remains at £37,700 and higher rate at £50,270.

31 July

Working Tax Credit and Child Tax Credit claims for 2021/22 must be confirmed and renewed for 2022/23 if required.

Deadline for second payment on account for 2021/22 for those that pay self-assessed income tax.

1 October

All domestic electricity customers will receive a £200 discount on their energy bill from October. However, this discount will be automatically recovered from people’s bills in equal £40 instalments over the next 5 years, beginning in 2023.

30 September

Old £20 and £50 notes can no longer be used after 30 September. Although some banks and the Post Office may still allow withdrawn notes to be paid into customers accounts.

31 October

Paper income tax self-assessment deadline for 2021/22 returns to be with HMRC.

December

The government scheme that guaranteed 95% mortgages with selected lenders ends. This scheme was launched in April 2021 to help first time buyers after lockdown.

Your financial plan could be impacted by these key dates. Talk to us for advice.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Key Takeaways:

• The new tax year is upon us making it a good time to make sure you're fully prepared for the financial year ahead.
• Your financial plan could be impacted by these key dates, talk to us for advice.
• HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

There’s plenty of advice and ‘life hacks’ on how to make spring-cleaning less of a chore. A quick Google search will throw up hundreds of random tips – like using cola to clean the toilet, lemon to clean the taps and vinegar to clean just about anything!

When you’ve finished scrubbing your worktops with baking soda and polishing your windows with newspapers, why not try spring-cleaning your finances? Here are some handy hints to get you started:

Throw away unnecessary spending habits

Look at your bank statements for the last couple of months for a snapshot of your finances. It can help highlight any problem spending areas and where you can potentially make savings.

Do you have countless direct debits or standing orders? Is there anything you’ve signed up for that you no longer use? Those small payments going out every month can really add up! If you have credits cards make sure you pay them off in full each month, or if not see if you can shift your debts to a lower interest credit card or loan. Just to give yourself space to gradually pay it off without incurring huge amounts of interest.

Invest in an ISA

An Individual Savings Account (ISA) is a tax-efficient way of saving. In the current tax year (April 2022 to April 2023) the government allows us to put up to £20K into an ISA. Make sure you take advantage of this before the tax year ends in April 2023.

You can save your money in a Cash ISA or Stocks and Shares ISA or split the allowance across both types. A Cash ISA you don’t pay tax on the interest you make on these savings. With a Stocks and Shares ISA means you don’t pay tax on any income or capital gains you’ve made on your investments - but obviously this involves more risk.

There are a few other things to bear in mind. The tax efficiency of ISAs is based on current rules. The current tax situation may not be maintained. And of course, the benefit of the tax treatment depends on individual circumstances.

With Stocks and Shares ISAs, although there is no fixed term you should consider them as a medium to long term investment, of ideally five years or more. And remember, the value of your Stocks and Shares ISA and any income from it may fall as well as rise. You may get back less than you invest.

Spring clean your protection

Spring-cleaning your protection insurance is also important as you’ll want to make sure you have the right cover for your family and your lifestyle.

If you’re renting a property you will want to protect your belongings with home contents insurance. If you have just bought a home, you’ll need to make sure both your building and possessions are adequately covered. You should also think about accidental damage cover or home emergency cover.

If you have others who depend on your income, consider taking out cover to provide financial security for them should you become ill or die. Life insurance and critical illness insurance may give you the peace-of-mind that you or your family could cope should the worst happen.

Set yourself a budget

To get started, use your bank statements to analyse your spending patterns and tally up your typical monthly outgoings. Compare this to your monthly income and you can quickly see what’s left (or not) by the end of the month.

Once you’ve done this you can set yourself a budget based on accurate figures. Keep it realistic as you’re more likely to stick to it.

Check on your mortgage

If you’ve got a tracker, fixed or discount rate mortgage, make sure you know when it ends as you’ll likely be switched to your providers Standard Variable Rate (SVR). The SVR is usually higher than the amount you’ve been paying and when interest rates change, so can your monthly payments.

It’s worth finding out what alternative products your current mortgage provider offers before checking out the rest of the market.

Get trusted advice

Discussing your finances with an expert can make managing your finances simpler. We can help you establish a financial plan that’s designed around your specific needs, make sure it stays on track, and provide ongoing advice that will help you achieve your goals.

If you would like to spring clean your finances this year, please get in touch for a review.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Key Takeaways:

• We have a few handy tips to help you spring clean your finances.
• Throw away unnecessary spending habits to help you save more and avoid spending excessive money.
• ISAs are tax-free savings account that allow you to put in up to £20k a year.
• Check what insurance and protection you have to ensure you have the right cover for you and your family.
• Create a budget for yourself to stop unnecessary spending.
• Check your mortgage to see if you could be getting a better deal and saving money.
• Spring clean through your finances and get in touch for a review today.

What is an SVR mortgage and why might you end up with one?
Sarah has never overstretched herself when it comes to money. After paying her monthly bills, she’s always had a bit left over. So, when her mortgage lender wrote to her to remind her that her five-year fixed-rate deal was coming to an end and that she needed to find a new deal or she’d be switched to their standard variable rate (SVR), she simply let them make the switch. She wasn’t worried about money and thought looking for a new deal would be too much hassle.

The interest rate on an SVR mortgage is set by the bank or building society and they can put it up at any time. It is usually higher than the rate you’d get with a mortgage deal and can significantly increase your monthly payments.

As the cost-of-living crisis starts to bite, times are tight for Sarah. Her energy bills have skyrocketed. Filling up the car costs a fortune. In fact, she seems to be paying more for everything these days, even her TV subscriptions are getting more expensive. She’s struggling to cover her monthly bills but, with interest rates rising, Sarah’s worried she’s missed the boat when it comes to securing a competitive mortgage deal.

Has Sarah left it too late to switch from her SVR mortgage?

Although the interest rates on both tracker and fixed-rate deals are creeping up, it still makes sense for Sarah to switch away from her SVR mortgage. According to Moneyfacts, in March 2022 the average SVR was 4.61%, while the average rate on a two-year tracker was 2.03% and on a two-year fixed was 2.65%. This means Sarah should be able to make significant savings by switching. And she’s not the only one who could save money. Research by Habito found 27% of mortgage holders in the UK are currently on their lender’s SVR and they worked out, on an average mortgage, this translates to an extra £340 a month.

How can Sarah make sure she secures the best deal possible?

Sarah would almost certainly benefit from speaking to a qualified mortgage adviser. They understand the market and know where to find the best deals. Sarah may have to pay a penalty to switch from her SVR mortgage. Sometimes, you have to spend a year or more on an SVR before switching without a penalty. A professional will be able to advise Sarah whether it makes sense to wait or to pay any penalty and remortgage straight away.

But Sarah is nervous about speaking to an adviser; she finds mortgages confusing.

Mortgages can be complicated but a qualified adviser will be able to explain them simply and answer any questions Sarah has. Mortgage advisers are there to take the effort out of finding the right deal and it’s got to be a lot less stressful than worrying about whether you’re going to be able to pay your bills each month.

If you’re on an SVR mortgage or your current deal is coming to an end and you want to avoid being switched to an SVR mortgage, we’ll be happy to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Key takeaways:

• Switching from an SVR mortgage could save you serious money.
• Speak to a qualified mortgage adviser to make sure you switch to the best deal at the right time.
• If your current deal is coming to an end, speak to a mortgage adviser before you’re switched onto your lender’s SVR.

They chatted about making a will a few times, but somehow life always got in the way. Until one day, 10 years after moving in together, Pete got a call that would change his life forever – Tom had been killed in a car accident.

The intestacy trap

On top of grieving for his partner, Pete found he was also facing an uncertain financial future. UK intestacy laws meant he wasn’t entitled to inherit any of Tom’s property or financial assets unless he had joint ownership. Pete knew that Tom would have wanted him to inherit everything but, without a will, that didn’t matter.

Pete and Tom had owned their property as joint tenants, meaning Tom’s share automatically passed to Pete according to the rights of survivorship. However, without children or any surviving parents or siblings, the remainder of Tom’s assets ended up being passed onto a distant uncle he had scarcely known.

Without Tom’s savings and investments, life insurance policy or even the car that Tom owned but they both used, Pete now struggles to pay his bills.

How a will could have helped

Had Tom got around to writing a will, he would have been able to specify exactly who would receive what from his estate, including his savings, investments, car and other belongings. As well as writing a will, Tom could have made his wishes known by nominating beneficiaries to his pension and writing life policies under trust. By taking these steps, he would have given Pete the extra financial support he now so desperately needs.

As it stands, Pete still has the legal right to claim against Tom’s estate as they had been cohabiting for more than two years - but this will be a costly and time-consuming process and a positive outcome isn’t guaranteed. If Tom had made a will, this added stress could have been avoided.

Don’t put it off

In the UK, the number of cohabiting-couple families is growing faster than the number of married-couple and lone-parent families. However, cohabiting couples have none of the legal protections afforded by marriage. A will is one way to ensure your partner inherits according to your wishes. Despite this, three in five UK adults do not have one.

Let us help

Any will must be drawn up accurately without ambiguities and executed correctly for it to be valid and effective. So, it makes sense to use an experienced professional.

A consultation with a will-writing expert will allow you to explore ways in which to reflect your wishes and protect the financial future of your loved ones in the most tax-efficient way possible.

If you’d like to find out more about how to arrange a will, we’re here to help.

Will writing is not part of The Openwork Partnership’s services and is offered in our own right.

The Openwork Partnership accepts no responsibility for this aspect of our business. Will writing and Trusts are not regulated by the Financial Conduct Authority.

Key takeaways:

• If you’re cohabiting with your partner (but you’re not married or in a civil partnership), it’s important you both make a will. This can ensure that if one of you dies, the surviving partner inherits according to the other’s wishes.
• An expert can help ensure your will is drawn up accurately and executed correctly so that it is valid and effective.

Practically every penny of Mike’s monthly salary is accounted for so, as the cost-of-living crisis starts to bite, he’s worried about making ends meet. He’s started shopping around for cheaper deals on his broadband, mobile-phone contract, and car insurance, and he’s also cancelled his gym membership and a couple of his TV subscriptions. But he’s overlooked the bill offering the largest potential saving – his mortgage.

What is remortgaging?

Remortgaging involves taking out a new mortgage on a property you’ve already bought. You might do this to replace an existing mortgage deal or to borrow money against your home.

Is remortgaging right for Mike?

After Mike’s last mortgage came to an end, he didn’t look for a new deal so he was switched onto his lender’s standard variable rate (SVR). An SVR is usually much higher than fixed and tracker rates, and it can go up at any time. Research by Habito found 27% of mortgage holders in the UK are currently on their lender’s SVR, and they worked out - on an average mortgage - this translates to an extra £340 a month. This means Mike could almost certainly benefit from remortgaging.

Other reasons to remortgage

Even if you’re not on your lender’s SVR, there are a variety of reasons you might want to remortgage:

• To beat interest rate hikes. As inflation goes up, interest rates are starting to follow suit, so it may make sense to lock into a low rate now.
• You’re coming to the end of a deal. Mortgage advisers generally agree you should start looking for a new deal around three to six months before your current rate ends. However, the research by Habito found 46% of mortgage holders are unaware of this.
• The value of your home has gone up. A significant rise in the value of your home may have moved you into a lower loan-to-value band, meaning remortgaging may give you access to reduced rates.
• You want to borrow against your home. Remortgaging may allow you to raise money cheaply on low rates. Before doing this, it’s worth getting financial advice to make sure this really is the cheapest way for you to borrow.
• You want to overpay, and you can’t on your current deal. If you’ve come into some money recently, remortgaging will allow you to reduce the size of your loan and possibly get a better rate. You’ll need to take into account any exit fees or early repayment charges to weigh up whether remortgaging makes financial sense.

Where to start

It’s not always clear cut whether you’ll benefit from remortgaging. A qualified mortgage adviser will look at your circumstances and find out exactly what you want to achieve by remortgaging. For example, are you simply looking to reduce your monthly payments or do you want a more flexible mortgage that allows payment holidays? The adviser will then set out the best options available. Regular mortgage reviews can help ensure you’re never overpaying unnecessarily.

If you’d like to speak to someone about your mortgage, we’re here to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Key takeaways:

• Remortgaging can be useful in a variety of situations from reducing your monthly payments to borrowing money against your home.
• It’s not always clear cut whether you’ll benefit from remortgaging – talking to a qualified mortgage adviser can help you decide whether it’s right for you.
• Regular reviews with a professional can make sure you’re not overpaying unnecessarily on your mortgage.

Tina is a fit and vibrant 59-year-old who expected retirement to offer a whole new lease of life. She was looking forward to using her increased leisure time to explore Europe while indulging her passion for climbing. However, after going through her finances, she’s now concerned she won’t be able to afford her monthly bills let alone pay for trips abroad.

Tina has always managed her day-to-day finances really well, but she never sat down and worked out how much she’d need for a comfortable retirement. A 2021 Which survey found that a retiree in a single-person household spends an average of £19,000 a year and needs £31,000 a year to enjoy luxuries such as long-haul trips and a new car every five years. When you compare this figure with the current maximum state pension of approximately £9,627 a year, it becomes clear relying on that income alone can cause problems.

Why is money going to be so tight for Tina?

There are a number of reasons for this:

Career breaks have affected her state pension entitlement

Tina was a stay-at-home mum throughout most of her 20s and into her mid-30s, when she split up with the father of her children. They were never married so Tina isn’t entitled to any of his pension.

After working full-time for a few years, Tina moved in with another partner and splitting the bills meant she could afford to drop down to part-time hours. She began working full time again when that relationship ended a few years ago and she moved into her own place.

Despite working on and off, Tina hasn’t made anywhere near the 35 years’ worth of National Insurance contributions that guarantee a full state pension. As she’s made more than ten years’ worth of contributions, she’ll get something but nowhere near as much as she expected.

If Tina had checked her state pension forecast regularly, she could have avoided a nasty shock and taken steps to increase her pension pot.

She’s only made minimum contributions to her workplace pensions

Tina’s been enrolled in a couple of workplace pension schemes, but she’s only ever made the minimum contributions required.

There are no fixed rules about how much you should pay into a private pension, but one rule of thumb is to take the age you start saving and divide it by two to give you the percentage of your salary you should put away each year. So, if you start saving at 30, you should pay in 15% of your salary.

It’s worth bearing in mind that the government tops up private pension contributions in the form of tax relief at your highest rate of income tax. Basic rate taxpayers receive tax relief of 20%, while higher rate and additional rate taxpayers can claim back 20% and 25% respectively through their tax returns.

What can you do to boost your pension pot?

There isn’t one simple answer when it comes to saving for your retirement. It’s complicated! So it makes sense to get help from a financial adviser.

If you’d like to make sure you’re doing all the right things to enjoy a comfortable retirement, we’re here to help.

Key takeaways

• Whatever your age, it’s worth reviewing your pension arrangements.
• Get a state pension forecast to check how much you’re likely to get.
• Make sure you’re taking full advantage of any government and employer incentives.
• Check that you’re making the most of tax relief and employer contributions.
• Get help from a financial adviser.

There is no right time to begin investing but there are some decisions to make that could affect your returns. If you are 7 years old and saving your pocket money for a PS5, 17 saving the money from your first job for a car, 27 saving for your first house or 57 and finalising your retirement plans which include a dream holiday, we can provide personalised advice for you.

Angela was looking at ways she could reduce her inheritance tax. After spending some time researching, she realised she could make small gifts to as many people as she likes, and these gifts will be exempt from IHT. Wanting to help her grandchildren out, she gifted them £1000 each.

Isabella, Harrison, and Ava were thrilled to receive the generous gift from their grandma and were quick to discuss what they wanted to do with it. After listening to their ambitious ideas, Angela sat the children down and told them that the best thing to do, was to put it into savings and investments to make more out of the money and eventually carry out their future goals.

The surprises of savings accounts
After listening to her grandma, Ava being the youngest of the 3, wasn’t too clued up on savings, so deposited the £1000 into a regular savings account. Regular savings accounts can be great, easy ways to save securely and access money easily, however, they do not make a lot of interest.

With average interest rates for a savings account at 0.06%, Ava looked back into the savings account after a year to discover it had only made £0.60 in interest. The little interest added meant that Ava couldn’t afford the new laptop that she so desperately wanted and had to settle for an older version instead.

Are Cash ISAs still effective?
With the desire to buy a new car, Harrison chose to put his money into a cash ISA after reading about the tax-free, easy to access advantages that they had.

However, Cash ISAs also have a very low interest rate due to the fact they are affected by the rise of the cost of living and high inflation, meaning you make little to no interest on the money that is in there.

The average cash ISA interest rate being 0.63%, Harrison went back to check on his investment after a year and found that it had made £6.32 in interest. Although this interest earned meant that he was unable to put the deposit down for the car he wanted.

Why Stocks & Shares ISAs would’ve been better
Isabella the oldest of the 3 was saving for a deposit on her first home. She found that a stocks and shares ISA was the most appropriate way to invest her money.

Stocks and shares ISAs are a good way to start investing your money as you can invest up to £20,000 a year, any income is protected from tax, and they can offer considerably higher returns over time.

With an average return on stocks and shares ISA being 13.55% if paid yearly, Isabella reviewed her account after a year and was surprised to see that she had made £144.24 of interest on the £1000 she inputted into the ISA. Using this way of investing now means Isabella has the money to be able to pursue her dreams of home ownership.

Let us help
Don’t let what happened to Harrison and Ava, happen to you. Whether you are taking your first steps in investment or a seasoned saver we’re here to guide you through the most suitable ways to invest your money, ensuring your future and you are protected.

The value of your investment and any income from it can fall as well as rise and you may not get back the amount you invested.

Key takeaways:

• You can reduce IHT by gifting money to family members.
• Savings accounts are good and easy short-term ways of saving, but don’t offer good interest.
• Cash ISAs are tax-free, easy ways of saving money but can interest rates can easily be affected by rise in the cost of living and higher inflation.
• Stocks and shares ISA are tax-free ways of saving with considerably higher returns over time.

Financial advice isn’t just for the super-rich with complex tax situations and offshore bank accounts. It can be invaluable for anyone with financial goals.

Whether you're saving for your future, buying your first home, remortgaging or want to protect your home and income – speaking to an expert can make all the difference.

Saving for your future

Robyn and Tim met in their late 20s and soon got married. They were keen to get on the property ladder so spoke to a financial adviser who helped them form a savings strategy.

They both opened a Lifetime ISA and opted for a Cash ISA (rather than stocks and shares) as they were not willing to risk the value of their savings falling in return for a higher potential gain.

Their adviser also encouraged them to review their pensions. As both of their employers matched anything they paid in, it made sense to maximise their pension contributions – even though retirement felt a long way away.

Buying your first home

They saved the maximum amount of £4,000 a year into their Lifetime ISAs, topped up by the government's 25% bonus. In just 3 years they saved the £30K deposit needed to buy a £300K home. But before they could start house hunting, they needed to secure a mortgage.

A good mortgage adviser can scour the market, chase the provider to keep your application on track and guide you through the home buying process – invaluable if you’re a busy professional buying for the first time.

Their adviser helped them understand the different mortgages available and which most suited their needs. As a result, they bought their home knowing they could comfortably afford their monthly repayments.

Remortgaging

Robyn also owned a flat with her Dad that she lived in before she met Tim. She now lets it out but wanted to remortgage and release some funds.

Armed with more knowledge, she initially researched the market herself – but found that most Buy to Let mortgages are only available through brokers.

She found a specialist Buy to Let mortgage adviser who managed to secure her a low fixed rate mortgage which also released £40K of her equity. Her monthly repayments only increased marginally, and she has peace of mind that they won’t rise for the duration of the fixed term.

Understanding your tax position

Although Robyn and Tim didn’t exceed the first-time buyer stamp duty threshold of £300K for their new home, as Robyn already owned a property, they were not considered first time buyers. So they had to pay 3% of the house’s value in stamp duty. Had they got tax advice before getting married, they may have reconsidered their options.

When Robyn remortgaged her flat and replaced her Dad’s name on the deeds with Tim’s (a condition of the new mortgage) her solicitor warned they may be liable for more stamp duty – as she was gaining 50% of the property from her Dad, then Tim was receiving 50% from her.

As this was a complicated situation, Robyn sought specialist tax advice. As a result, they avoided paying a large amount of additional stamp duty.

Protecting your home and income

When you take out a mortgage it’s not just the building and its’ contents that needs to be insured. You should also consider what would happen if you or your partner lose your job, become critically ill or die.

Robyn and Tim spoke to an adviser to discuss protection. As a result, they can both now relax, knowing they will be able to pay off their mortgage and stay in their home, should the worst happen.

If you want to learn more and receive advice tailored to your personal circumstances, please get in touch.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Tax advice is not regulated by the Financial Conduct Authority.

Key takeaways

• Financial advice can be invaluable, whatever your income and whatever stage of life you’re at.
• A mortgage adviser not only recommends a mortgage that best suits you but also guides you through the home buying process.
• You should always consider tax implications before big life events – such as getting married, buying a home, or separating from your partner.
• When you take out a mortgage you should also make provisions for if you were to lose your job, become critically ill or die.

Our informative video explains the journey our clients take when deciding to invest in one of our OMPS portfolios. Learn more about the building blocks for the portfolios and funds which are managed by some of the world’s leading investment managers, who we’ve carefully selected.

Lindsay and Sam have just found out they’re expecting their first baby. Although they’re excited at the prospect of starting a family, it’s come as a bit of a surprise and their current living situation is far from ideal. They’ve been staying with Lindsay’s dad in his two-bedroomed terrace for just over a year while they save up a deposit for their first house. The lack of space and privacy has proved challenging to say the least. Adding a baby into the mix seems like a terrible idea.

On the positive side, Lindsay and Sam now have a decent deposit to put down on a house. Despite this, friends have warned the couple they’ve no chance of getting a mortgage due to their working situation. Sam is a self-employed roofer and he’s pretty successful. However, he’s only been working for himself for two years. His friends have told him, he’ll need at least three years of accounts before a lender will go anywhere near him. They say any mortgage the couple can get will be based on Lindsay’s income alone. Lindsay works as a hairdresser and her salary is nowhere near enough to secure the kind of mortgage they’re hoping for.

What can Lindsay and Sam do?

Should they resign themselves to bringing up their baby in Lindsay’s dad’s spare room? Or maybe they should accept that, for now, renting is their only realistic option.

In fact, the best thing Lindsay and Sam can do is stop listening to their friends – no matter how well meaning – and seek help from a qualified mortgage adviser.

But why? What can we tell you that you can’t find out online?

We know the market
If, like Lindsay and Sam, your needs or circumstances are ‘out of the ordinary’, your options may indeed be more limited than those of other buyers. However, this doesn’t mean you don’t have options. We know the lenders who are willing to consider buyers in your situation and we’ll check you’re likely to meet their specific lending criteria before submitting a formal application. This will save you time and avoid unnecessary searches on your credit file.

We look beyond the headline rate
An attractive rate may seem like your best bet when choosing a mortgage but you also need to factor in things like fees, loan conditions and the mortgage term. We look beyond the headline rate and can help you understand how the length and type of loan will affect how much you pay in the long term. We’ll also highlight any additional expenses like administration and booking fees, and valuation costs.

We do the hard work for you
As well as helping you select the right mortgage, we’ll work with you to complete all of the necessary application forms and liaise on your behalf with solicitors, valuers and surveyors. We can also recommend products that provide financial protection should the unexpected happen.

We’re professionally qualified
Unlike many mortgage sellers working for banks and building societies, we’re fully qualified to advise you on a wide range of lenders and products.

Key takeaways:

• Get help from a professional. Don’t rely on friends’ advice. The market is constantly evolving. Things that may have been true when your friends bought a house may not be true now.
• Look beyond the headline rate when choosing a mortgage deal.
• A mortgage adviser can help with more than just choosing the best deal, they can ensure the whole house-buying process runs as smoothly as possible.

Matt was delighted when he landed his dream job as a football coach. He got to do what he loved every day. Life was good until, one day, he fell down the stairs and everything changed. Matt seriously hurt his back in the fall and now struggles to stand for any length of time. As a result, he needs regular physio and hasn’t been able to work since the accident. Managing the pain and being unable to do the job he loves is hard enough but his situation is made worse by the fact he is now constantly worrying about how he’s going to make ends meet.

Unfortunately, Matt’s experience isn’t as uncommon as you might think. Home may be where the heart is but it’s also where you’re most likely to have an accident, according to the Royal Society for the Prevention of Accidents (Rospa).

Figures from Rospa show children under the age of five and those over the age of 65 are at the highest risk of having an accident at home, with falls being the most common type of mishap. To give you an idea of the extent of the problem, the annual cost of home accidents in the UK is a staggering £45.63 billion. More mishaps happen in the lounge than any other room and, tragically, there are around 6,000 deaths every year in the UK as a result of accidents at home.

Preventing accidents in the home

Although you can’t remove the risk of accidents in the home altogether, there are some sensible precautions you can take. For example, if you’re trying to reach something high up, don’t use a chair; it’s always better to use a stable step-stool. It’s also worth bearing in mind that a lot of accidents happen when we’re rushing so, no matter how busy you are, try to take your time.

There are also steps you can take to provide a little more financial security if you’re ever unlucky enough to find yourself in Matt’s position.

Accident protection

Accident protection can provide a cash lump sum to help you and/or your family should you have a similar experience to Matt, meaning at least you won’t have to worry about your finances. It can provide cover for:

• Broken bones
• Hospitalisation due to either an accident or sickness
• Permanent injuries
• Permanent disablement
• Death

A professional adviser will be able to help you find the most suitable policy for your needs. If you’d like to talk about accident protection for you and your family, we’ll be happy to help.

Key takeaways:

• You’re more likely to have an accident at home than anywhere else.
• Falls are the most common type of accident in the home – reduce your risk by using a stable step-stool to access hard-to-reach areas, and taking your time when carrying out chores around the house.
• Accident protection can provide a lump sum to help with the expenses you may face in the event of a mishap in the home – speak to an adviser to find the most suitable policy for you.

Sarah and Andrew’s 10-year-old twins, Isabelle and Isaac, couldn’t be more different. While Isabelle is boisterous and full of beans, Isaac is gentle and reserved. The children do have one thing in common though - they’re both extremely bright and they already know exactly what they want to do when they grow up. Isabelle loves animals and wants to be a vet, and Isaac is a very talented artist and has his heart set on art school.

When they found out they were getting two for one, Sarah and Andrew couldn’t have been happier. But bringing up twins hasn’t been cheap and the couple are aware that as the children grow so will the strain on their finances. Having heard stories about the ever-rising cost of higher education, Sarah and Andrew are particularly keen to start saving for the twin’s university education.

How much does university cost?

On average, it costs just under £57,000 to go to university in the UK, according to to Save the Student. This figure is based on the fact that the cost of tuition for most students is about £9,250 a year, average living costs are £9,720 a year and the majority of undergraduate degrees last three years. However, the exact cost can vary quite a lot depending on where you study and the course you’re doing. If Isabelle still wants to become a vet after doing her A-levels, she’ll be looking at going to university for five or six years so her costs will be higher than average. As well as a tuition fee loan, students can get a maintenance loan to help cover living costs. However, the average maintenance loan is only about £5,640 a year so there is more than likely going to be a significant shortfall.

Where should Sarah and Andrew start?

The good news for Sarah and Andrew is that they’ve started thinking about saving early. With at least eight years before the twins go to university, if their parents start saving straight away there is plenty of scope for their investments to grow.

The first thing Sarah and Andrew should do is get advice from an expert. This will help to ensure they make the right investment decision for their particular circumstances and avoid potential pitfalls.

What will Sarah and Andrew need to consider?

There are three main points Sarah and Andrew will need to consider when deciding on the best way to save for Isabelle and Isaac’s future:

Ownership
Sarah and Andrew will need to decide whether to give ownership of the investments they make to Isabelle and Isaac. This is not generally recommended as it would mean the twins could cash that investment and blow the lot on their 18th birthday (16th if they were living in Scotland).

Type of investment
As Isabelle and Isaac are still quite young, Sarah and Andrew have the option of making long-term investments that will hopefully achieve better returns. Being able to invest over a long period will widen the range of investment types available to Sarah and Andrew. Once they’ve made their initial investments, they would be well advised to review them on a regular basis to make sure their money continues to work as hard as possible.

Tax
Sarah and Andrew shouldn’t choose their investment based on tax. However, once they’ve decided on the most suitable investment for their circumstances, it makes sense to invest via the most tax-efficient route.

If you’d like to discuss investment options for your child’s university education, we’ll be happy to help.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways:

• The earlier you start saving, the better. This opens up the possibility of long-term investments offering potentially higher returns.
• Get advice from a professional to help ensure you make the right investment choice first time.
• Consider who’ll have ownership of the investments – giving ownership to a child can be risky.
• Review long-term investments on a regular basis.
• Once you’ve chosen your investment, make sure you invest via the most tax-efficient route.

Here is the 2022 edition of the Omnis guide to responsible investing, which sets out their approach to incorporating environmental, social and governance (ESG) factors into their processes.

Click to read Omnis ESG Guide 2022

There are 4.8 million self-employed people in the UK and only a third have any kind of pension arrangement. A shocking statistic when you consider that State support is shrinking and we’re all living longer.

Of course, saving for a pension when you’re self-employed is not as straightforward as it is for an employed person, who might automatically benefit from a workplace scheme and employer contributions. We’ve outlined some key points below for you to consider:

Don’t rely on the State Pension

Whether you’re employed or self-employed you’re entitled to the full basic State Pension (currently £129.20 a week) if you’ve paid in 30 years of National Insurance Contributions.

If you’re self-employed you can only claim the additional State Pension if you’ve had periods of employment.

On its own then, State support is unlikely to enable you to continue your current standard of living into retirement. That’s why it’s imperative for the self-employed to find other ways to provide the additional income needed in retirement.

Start saving early

It’s stating the obvious, but the sooner you start saving into a pension the bigger your potential retirement fund. You’ll also have more time to benefit from the tax relief that’s available.

To highlight the importance of saving early, a 25-year-old male looking to retire at 68 would need to contribute £236.25 per month in order to achieve a retirement income of £17,500 a year. If the same man had waited until he was 45 before he started saving, he would need to contribute £495.83 to achieve the same level of income, an additional £259.58 per month.

Minimise the amount of tax you pay

One of the main benefits of paying into a pension is the tax relief the savings attract. For example, if you’re a basic rate taxpayer paying £100 into your pension each month, HMRC will effectively add an extra £20 in tax relief.

The maximum amount you can save each year that attracts tax relief (otherwise known as the annual allowance) is £40,000.

Importantly, if your income is low and you’re not able to save the full £40,000 in one tax year, you can carry forward any unused allowance, and use it against earnings in the next tax year. Please note:

• You must have been a member of a registered pension scheme during the years you want to carry forward
• Your tax relief is limited by your annual earnings in the year you want to carry forward
• You can only carry forward unused allowance from the three previous tax years

What type of pension is right?

The self-employed can choose from a range of different pension products, including stakeholder pensions, personal pensions and Self Invested Personal Pensions (SIPPs). Each has its advantages and disadvantages – we can advise on which is best for you.

Perhaps the most flexible pensions are stakeholder schemes. They allow you to save as little as £20 per month and the charges are relatively low, which is helpful if you have irregular income levels.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes, which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways:

• A state pension alone is unlikely to be sufficient to fund your retirement.
• Make your money go further by taking advantage of the tax relief available on your pension savings.
• There are a lot of factors to take into account when choosing a pension, so it makes sense to get professional advice.

Carly and Steve made serious sacrifices to save a deposit for their first home. To cut costs, they moved from their two-bedroomed flat in the centre of Manchester to a studio flat in one of the less well-regarded suburbs. When the damp and the noisy neighbours got too much, they moved in with Steve’s mum and when her questions about when they were going to start a family got too much, they moved in with Carly’s big sister.

As well as moving home three times in the space of a year, Carly and Steve gave up takeaways, holidays and their gym memberships. When they finally had enough money for a deposit, they couldn’t apply for a mortgage fast enough. They were crushed when their application was rejected due to a poor credit score.

A good credit score is vital for homebuyers, as this is how lenders assess how much of a risk you pose. The UK has three main credit referencing agencies – Experian, Equifax and TransUnion. They use your personal banking information to assess how well you manage credit. This is summarised in a credit report and by a single number - your credit score. Lots of things can affect your credit score, including moving house frequently, which is seen as a red flag as it can be a sign you’re struggling to pay your rent. So, as well as avoiding frequent changes of address, what can you do to make sure you don’t end up in Carly and Steve’s position?

Check your credit report for errors

Even small mistakes, such as a mistyped address, can affect your credit score. If anything looks wrong, contact the credit referencing agency to correct it.

Register to vote at your current address

This proves where you live and can add 50 points to your credit score, according to Experian.

Build your credit history

Having little or no borrowing history may result in a lower credit score. You can build your credit history by opening a current account, setting up Direct Debits or getting a credit-builder credit card.

Keep up with your payments

By avoiding late or missed payments on existing credit accounts, you show lenders you’re a reliable borrower.

Limit applications for new credit

When you apply for credit, your credit report is searched. Too many searches in a short space of time can impact your credit score. Try to avoid applying for new credit – such as a mobile phone contract or a credit card - during the six months before a mortgage application.

Limit how much credit you use

If you have a limit of £1,000 - on a credit card for example - and you’re using £500, that’s 50% of the available credit. If possible, you should try to make sure you’re using less than 30% of all the credit available to you.

Keep old accounts open

It’s good to be able to demonstrate a long credit history and show you’ve successfully managed a number of different credit accounts. Having unused credit on old accounts also helps limit the proportion of available credit you’re using.

Check your financial links to other people

If you opened a joint account with an ex-partner or previous housemates, their poor money management could impact your credit score. Check you aren’t linked to anyone who may have a negative effect on your score and ask for outdated links to be removed.

Whether you’re a first-time buyer or a homeowner looking to move, we can help find the best mortgage for you.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Key takeaways:

• A poor credit score can lead to mortgage applications being rejected.
• Check your credit report for errors and ask for any mistakes to be corrected.
• Improve your credit score by taking steps to show lenders you’re a reliable borrower.
• Professional advice can help ensure you find the best mortgage deal for your circumstances.

Whether you want to go on holiday or just want to save some money for the future, budgeting is a good way to put aside some money for reaching this goal. Here you can find some tips to help you take control of your finances.

Why is budgeting so important?

You might think it’s not worth spending that much time counting all your income and expenses. But if you use apps or spreadsheets to make it visible how much you earn and spend on average every month, it will pay off.

In case of the unexpected or just having a big expense, it’s important to have some savings not to become indebted.

How to start budgeting?

First, you will need to count how much money you bring home on average. Don’t forget to take your benefits into consideration as well so that you can put down the precise number.

After you become aware of how much you earn every month, it’s necessary to count your average monthly expenditure too. Don’t forget to look at at least three months of your expenses to be able to see some trends.

If you know your income and your expenses, you can compare them in order to see whether you spend more than you earn or not. If there is some money which remains every month then it’s easier for you to make a savings account. If you earn less than you spend, try to cut back on your expenses not to get into a debt spiral (spending and borrowing in turn).

In case of having debts and savings at the same time, it may be a good idea to pay off the one with the other, because for loans the interest rates are higher so you earn less with the savings interests than you have to pay for the loan’s interests.

What kind of costs do you have to count on?

If you know how much money you spend every month, you can set up categories to see the amount of your needs and wants. First count the essential spending, for example, the rent, utility bills and mortgage. These are your needs which you can’t leave out of your expenses. Although there are some tips to cut back on utility bills you can also include them in your budgeting.

In order to set budgeting goals, you also need to know how much you spend on nice-to-have items like meals or holidays. You can save more if you tackle the biggest costs, for example, eat-outs. From a financial aspect, it’s better to cook for yourself and your family than have a meal in a restaurant. When cutting back on costs don’t forget to remain the things in your budget you really love within your means. It’s also important that you don’t concentrate on a typical month to work out the amount of your disposable income and set your financial goal according to this.

After you have set your financial goals, you can concentrate on the third main category of where your income gets into. It’s necessary to build some emergency savings in case of the unexpected. Experts recommend to have at least 3 to 6 months of living expenses as a backup, but to have £1000 is already a good start.

How to set your budgeting goals?

When you set your budgeting goals it’s good to use the 50/30/20 rule where the biggest category is the essentials, the next one is the fun stuff and the last one is the savings. So try to split your income according to the percentages each category gets.

Try to set realistic financial goals, so don’t forget to build in a buffer to be able to adapt to the rising prices as well. Make the plan together with your family so that it will be easier to stick to the plan. Don’t forget to review your budget from time to time. With this checking, you’ll see whether you need to change your goals and where you could still cut back on your expenses.

You can also use piggy banking to automate spending. You can set spending categories, create a jar/piggy bank/account for each one and don’t exceed the amount of money you have there while paying for items within these categories.

If you’d like to discuss your budgeting goals, we’ll be happy to help.

Key takeaways

• Budgeting and saving is important to be able to cover unexpected expenses.
• First, count your monthly average income and expenses and compare them.
• Cut back on your expenditures to earn more than you spend. Next set up a savings account as well to have some backup.
• Set realistic financial goals to be able to stick to the plan.
• Use a budget planner or spreadsheet to make your finances more visible.
• Professional advice can help increase your savings and improve your budgeting.

People remortgage for many different reasons, including:

• Finding a better deal elsewhere – you might be on a standard variable rate (SVR) and want to move to a fixed-term rate.
• Coming to the end of a fixed-term deal on your current mortgage and wanting to lock in a lower rate with a new lender.
• The loan-to-value on the home is lower (as more of the mortgage has been repaid).
• Wanting to get ahead of a rise in interest rates, which would affect mortgage rates.

How a remortgage could help you save

One of the big reasons people remortgage is to save money on their monthly payments. If you’re on a standard variable rate that is higher than the fixed-rate deals currently available, you could save by switching – either to a fixed-rate mortgage or one that ‘tracks’ the Bank of England’s base rate.

If your home has gone up in value and you’ve paid off enough of your mortgage to give you a lower loan-to-value, it means you own more of your home and have less to pay off. Remortgaging could result in lower monthly mortgage payments because you’re paying off less of a loan amount (and in turn, less interest on it too).

How long does the remortgage application take?

The process can take between four to eight weeks from the time you apply so it’s good to start planning early. If you’re coming to the end of a fixed-rate or tracker term, your lender should tell you that your mortgage will move onto their standard variable rate1. This could be an ideal time to move if you find a better deal elsewhere, or you may even find an attractive deal with the same lender and go through a ‘product transfer’ (see box).

How much does a remortgage cost?

Existing lender fees
Your existing lender could charge you a fee if you’re leaving them early into a fixed period in your mortgage. This is known as an ‘early repayment charge’ and could be in the range of 1% to 5% of your outstanding mortgage balance. They will also charge you an ‘exit’ fee of around £50 to £100 to cover their administration costs.

New lender fees
Your new lender could charge you a range of fees, so before you commit it’s important to check what you will pay. This will help you calculate whether a move is financially beneficial overall.

Their fees could include:

• Application fee to set up your new mortgage. Could also be called an ‘arrangement’, ‘product’ or ‘booking’ fee. This could be around £1,000.
• Valuation and conveyancing fees. Some providers won’t charge for these, but it’s worth checking if you are moving to a new lender.
• Solicitor’s fee covering the legal paperwork to do with managing the transfer of your mortgage.

Is a remortgage right for you?
Whether or not you remortgage all depends on your situation and the type of mortgage plan you’re currently on. You may want a mortgage that lets you make overpayments, or you could be coming to the end of your current deal’s fixed term and think the lender’s SVR will be too high. One of the most important things you can do before you decide is, gather your current mortgage paperwork, look at the fees and get some expert advice on your next steps.

What about product transfers?
If your mortgage is coming to its maturity date but you’d prefer to stay with your current lender, you could consider a product transfer. Switching to a new mortgage product with the same lender could save you money and time.

Our financial advisers can help guide you through choosing the option for you.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Key takeaways

• People remortgage for many different reasons, including moving to a lender that offers a better fixed-rate of interest.
• Remortgaging can take between four to eight weeks so it’s good to start planning early if you are intending to change lenders.
• If you are coming to the end of your current deal’s fixed term, it’s worth shopping around and seeking some advice from an expert.

Being tax smart means knowing the basics about how tax affects your life and money. Here are 10 ways to reduce your tax bill, which could make your money go further for you and your loved ones.

Personal savings allowance
You’re entitled to receive some interest on your savings tax-free every year, depending on your income tax band. For non-taxpayers or basic rate taxpayers you’re allowed up to £1,000 per year; for higher rate taxpayers you get £500. If you have savings with a spouse or partner, you can each use your allowances against your joint savings.

Marriage allowance
If you are married, you might be able to take advantage of the marriage tax allowance. It allows one half of a couple who earns less than the income tax threshold (£12,570) to transfer up to £1,260 to their higher-earning spouse (who must be a basic rate taxpayer).

ISA allowances
An ISA account allows you to save or invest up to £20,000 tax free annually, whether it’s in a cash ISA or stocks and shares ISA – which also comes with the benefit of being exempt from dividend tax and capital gains tax on all growth.

Dividend allowance
You are allowed to receive up to £2,000 a year in dividends, tax-free. This allowance can be particularly useful if you own shares or you’re a company owner or director.

Capital gains allowances
Profits (or ‘gains’) you make on the sale or disposal of an asset (like a property where it’s not the main home, investments and shares not in an ISA or even personal possessions worth more than £6,000 (apart from your car) are exempt from tax up to the annual allowance of £12,300. For married couples or those in civil partnerships who own joint assets, the allowance is doubled – to £24,600.

Pension allowance
Your pension allowance annually is £40,000, although it can be lower for higher earners and where pension savings have been flexibly accessed. Any contributions you (or your employer) make receive tax relief from the government (based on your income tax band) of 20% or more – and the money in your pension pot will grow tax free.

Pension carry forward
If you don’t use up your annual pension allowance, you can ‘carry forward’ the previous three years’ worth of unused allowances providing you are still registered with the pension and have earned in the current tax year the amount you (or your employer) would like to contribute.

Charitable donations
You can donate to charity tax free and claim back the tax on your donation through gift aid. If you are a higher or additional income taxpayer, you can also claim back the difference to the basic rate on your gift aid donations. Just remember to keep hold of all records of your donations to claim tax relief when the time comes to submit your tax return.

Gift giving exemptions
Gifting comes with the benefit of being exempt from inheritance tax, for an annual gift amount of £3,000. Other tax-exempt gifts include money towards a wedding or grandchild’s education. No inheritance tax is due if you live for seven years after making the gift to someone who is not your spouse (for example, gifting your children a property).

Knowing your tax code
This one is important because your tax code tells HMRC how much of your salary they will collect. It’s a good idea to check your tax code each time you change jobs or at the start of the tax year. Being on the wrong code could mean you’ve overpaid tax and are due a refund.

These are just some of the ways you can ensure you’re making the most of your money and not paying more tax than is necessary. Speak to your adviser to learn more about your money, estate, and taxes. Please not that Openwork advisers are not able to provide specific tax advice.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

For specific tax advice please speak to an accountant or tax specialist.

Key takeaways

• You’re allowed to receive some interest on your savings tax free every year, depending on your income tax band.
• An ISA account allows you to save or invest up to £20,000 tax free annually, whether it’s in a cash ISA or stocks and shares ISA.
• Gifting comes with the benefit of being exempt from inheritance tax for an annual gift amount of £3,000.

Are Rachel and Samantha right to be concerned?

The short answer to this is yes! Research by Civitas has indeed found that a quarter of 20-to-34 year olds still live with their parents – a million more than two decades ago.

Even in the areas of the country where it’s cheapest to buy property, the rise in the number of adults living with their parents since 1998 is significant – 14% in north-east England and 17% in Yorkshire and the Humber. In London, the figure is a whopping 41%.

Research from Barclays points to a clear contributing factor to this trend. The bank revealed the average deposit for a first-time buyer in the UK in 2021 was approximately £61,000. More than half of those surveyed by the bank admitted they wouldn’t have been able to get a foot on the property ladder without financial help from their families.

And buying property isn’t the only expense future young adults may need help with: a university education costs approximately £57,000, an average wedding will set you back about £30,000, and even in retirement there’s less security now final salary pension schemes are largely a thing of the past.

So what can Rachel and Samantha do to help their kids?

Happily, there are plenty of options for Rachel and Samantha to consider if they want to start saving for their children’s future.

The two key principles to bear in mind when it comes to investing for your children are:

• The earlier you start saving, the better your potential returns
• Getting professional advice will help ensure you make the right investment decision for your circumstances and avoid potential pitfalls
• What kind of investment opportunities are available to Rachel and Samantha?

There are a number of different products that may be suitable for people in Rachel and Samantha’s position. The main ones are:

• Collective funds – a fund manager invests money from lots of individuals into a wide variety of assets. As your money is invested in multiple assets, it helps spread the risk.
• Investment bonds – these can be useful for managing lump sums placed into trust. The underlying investments are usually collective funds but the overall tax treatment is different. A key benefit is that they allow tax to be carefully managed during the investment term and when the investment is redeemed.
• ISA/Junior ISA – Any child under 18, living in the UK, can have a Junior ISA (JISA). The maximum investment into a JISA in 2022/23 is £9,000 a year. Children aged 16 and 17 can also own a cash ISA. The maximum investment for the 2022/23 tax year is £20,000.
• National Savings and Investments (NS&I) – NS&I has a limited range of accounts suitable for children, with varying tax advantages.
• Personal pension - There is no minimum age for a personal pension. Total contributions to a child’s plan for the 2022/23 tax year are limited to a maximum of £3,600.

If you’d like to discuss making investments for your children, we’re happy to help.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Key takeaways:

• The earlier you start saving, the better. This opens up the possibility of long-term investments offering potentially higher returns.
• Get advice from a professional to help ensure you make the right investment choice first time.
• There are a number of investment options that are particularly suitable for those looking to save for their children’s future, including collective funds, investment bonds, ISA/Junior ISAs, NS&I accounts and personal pensions.
• The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.
• HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

What is business protection insurance and how does it work? Find out why it could be right for your business.

If you own or run a small business, protecting it is always a priority, especially if something were to happen to a key member, which could affect the financial health of the company. In this situation, business protection insurance could provide some peace of mind.

What is business protection?

Business protection provides coverage in the event that a director, business partner or other key employee of your business suffers a critical illness or long-term disability or passes away. It’s a way of protecting the business and ensuring continuity. Business protection can help support forward planning in terms of succession and gives you ways to provide stability during what could be an uncertain time, especially if the company is small.

What are the types of business protection?

Business protection insurance usually offers cover in three ways:

Key person protection
This protection provides cover to replace key staff and cover income lost by their absence that could affect the business. It can cover any key employee from a head of department to the CEO.

Business loan protection
This protects the business by helping to repay business debts like a loan or bank overdraft if the owner or a key member (like a partner) dies or suffers a critical illness.

Shareholder protection
This cover is also known as ‘ownership’ or ‘partnership’ protection. It specifically covers the business owners if a shareholder dies, or suffers a critical illness, by ensuring that funds will be available to buy shares from the deceased shareholder’s estate.

These three forms of business protection also come with the option to add critical illness cover if you think it necessary. You could also get coverage for more than one person within the business. It’s always important to speak to an adviser who can help you figure out the right type of business protection for your business and any extra coverage (like critical illness) your business and employees could benefit from.

What are the benefits of business protection?
One of the benefits of business protection is the knowledge that should anything happen to a crucial member of the business, or someone with a financial commitment within the company, there would be some protection financially. It also gives other members of the business some peace of mind knowing this. Business protection can protect any loans or mortgages tied to your business, too, meaning lenders (knowing that you have business loan protection in place) are less likely to refuse a future loan, and will not approach the guarantor of a loan or their estate to recoup any existing loans.

In a small business that relies on a few key employees, the risk to the business from a financial point of view might increase if one of the team were unable to contribute because they die or are critically ill. In that situation, business protection is a wise plan to have in place.

An adviser can help you find out which type of business protection plan works for you and your company.

Key takeaways

• Business protection pays a lump sum if an owner, director, business partner or other key employee of your business suffers a critical illness or long-term disability, or passes away.
• This insurance usually offers cover in three ways – key person, business loan and shareholder protection.
• Business protection can also protect any loans or mortgages tied to your business.

Omnis Investments (Omnis) offers clients of The Openwork Partnership and 2plan Wealth Management a range of 26 funds. They appoint third-party investment managers, allowing investors access to the best talent in the market. No matter how big you are as an investment house, you can’t have the best investment managers for every single asset class – it is Omnis’ job to find the best managers out there.

Investment managers move firms and retire. The Omnis model means the team can decide if and when they need to find a new investment manager and then manage the transition without investors having to buy and sell funds. In other models, if your fund manager leaves, you would sell the fund and switch manually to another one, which can be a lengthy process. It would leave investors uninvested during the period and could sometimes lead to taxation events and charges.

Omnis has the responsibility for making sure investors always know what’s going on in the funds. The team can provide detailed information because they are able to monitor each fund manager, and make sure they are always investing in line with the funds’ investment objectives.

Manager selection

Omnis works with external specialist research firm Fundhouse to make sure it can identify the best investment managers.

There are more than 100,000 funds globally, which is more than the number of listed stocks, so Omnis distils these into a more manageable list and contacts managers to discuss their processes and capabilities.

That list then gets further refined to a shortlist of about five managers. Omnis then asks for more detailed information in writing and meets each team in person to gain an understanding of their investment approach. Omnis now manages more than £10 billion on behalf of its investors, and this size provides the level of access needed to fully assess managers.

Omnis tests each manager’s investment process with the data on other funds they manage to verify the information. A shortlist of investment managers then present to the Omnis Investment, Performance and Risk Committee, which will recommend its preferred investment manager to the Omnis board.

Sustainable Investing

Omnis assesses whether the managers are incorporating environmental, social and governance (ESG) factors into their investment decisions. The team sends each potential manager an ESG questionnaire at the start of the selection process. If they don't pass our ESG requirements, they don't progress any further. Omnis looks for examples of how they’re incorporating these sustainability factors, as well as getting a feel for their culture internally.

Incorporating ESG factors into investment decisions is not as straightforward as you might think, and once they are appointed as managers Omnis continually reviews their approach to ESG and reports back to investors.

Ongoing Monitoring

Once a manager is appointed, the ongoing monitoring kicks in. Omnis has regular meetings with the managers in person, and access to the portfolios so that the team can see all individual holdings at all times, allowing Omnis to make sure the funds are being run appropriately.

Omnis has launched many new funds over the past few years and the range of high quality, third-party fund managers that it can access continues to expand on performance, they aim to align their funds with the time horizons of investors, focussing on five-year rolling performance. Short-term performance over one week, one month or three months is considered as largely irrelevant in the context of meeting the stated five-year performance target set out in the objectives of the funds.

Although the performance of each underlying fund is important, Omnis does not recommend buying them individually. They should form part of a diversified portfolio to reduce risk and provide exposure to a diverse range of opportunities across asset classes, geographical regions, and industry sectors.

Your adviser will work with you to establish what the correct portfolio of Omnis funds is most suitable to you.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key Takeaways

• Omnis appoints third-party investment managers to run funds because it provides access to the best talent in the market.
• The process for selecting the best managers begins with a global universe of more than 100,000 funds, which are then distilled down using strict criteria
• Omnis assesses whether managers are incorporating environmental, social and governance (ESG) factors into their investment decisions

First time buyers guide to saving for a deposit

When preparing to buy your first home, saving for a deposit can be a difficult process. As house prices, inflation, cost of living and mortgage rates increase, it can mean that some mortgage lenders may require larger deposits of the property value. This can be challenging trying to save a large sum of money and for some within a limited time. According to the Office for National Statistics, the average UK house price was £277,000 in February 2022, which is £27,000 higher than this time last year. It’s also important to consider all the other costs that are involved in buying a property – conveyancing, legal fees, insurance policies and moving costs to name a few.

How much do I need to save?

A 5% deposit of the property value is the minimum amount you are able put down and however with this your options may be limited. A 10% deposit will provide with more options, whilst a 25% deposit will enable you to get competitive mortgage rates. The larger deposit you can provide, the less risk you will be considered to lenders and better rates will be available to you.

Where do I start?

Set a savings goal, which you can break down into easier amounts and a time frame to achieve it. Regular saving is most effective and it’s important to be realistic on how much monthly you can save so that it’s more easily attainable and doesn’t feel like such a chore or impact your life severely. To decide on how much to save, researching house prices in the area you would like to buy your property and using mortgage borrowing calculators online can help you work out how much you may need to save.

Buying schemes and saving accounts options

There are various government buying schemes such as Help to Buy and Shared Ownership and mortgage deals which you may be able to use depending on how much deposit you can raise.

With a Lifetime ISA (LISA) as a first time buyer under 40, you get a 25% bonus on your savings. For example, if you put £1,000 into your Lifetime ISA, the government will add an extra £250. This would mean you have £1,250 at the end of the tax year. It could help you in reaching your deposit goal quicker.

Top tips on how to build your savings:

• Set up a savings account – look into a suitable ISA and consider a Lifetime ISA
• Look at your current spending habits – analyse and see where you can possibly reduce your monthly bills and expenditure (e.g. minimise unused subscriptions/gym membership, change energy or network providers, eating out, daily coffees etc.) to save money.
• Create a budget and stick to it – make the budget realistic so it’s easier to stick to and when you struggle, remember the goal in mind. Set up standing orders so the money is automatically allocated to savings before you have chance to spend it.
• Reduce your rent/living costs – If possible, consider moving in with family, friends or find cheaper/shared accommodation which can allow you to save money quicker.
• Make extra money – sell clothes, items online that you don’t need, or if you have a skill/talent/craft that you can turn into a business, this can help you earn extra cash.
• Make use of discounts, vouchers and online deals – every little saving helps.
• Try “no spend” months or weekends” – only pay your bills and regular outgoings and necessities and move the money you save to your savings. Consider alternative free activities.
• Set limits – If it helps, take out a certain amount of money in cash for the week or month and leave your cards at home.
• Consider investing options – including saving accounts with higher interest rates, stocks and shares ISAs
• Ask for help and advice – from friends and family for support and we’re here for any financial advice you may need.

We’re here to help you on where you can save and invest your money towards your deposit, provide you with financial advice to make sure your savings and investments are working for you and advise you on how much you can borrow for a mortgage. We’ll also be here to help find the right mortgage deal when you are ready to buy your first home!

If you would like to find out more, please get in touch with one of our advisers.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

A stocks and shares Lifetime ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Key Takeaways:

• A 5% deposit of the property value is the minimum you can put down.
• Set yourself a savings goal, which you can break down into easier amounts and a time frame to achieve it.
• Government schemes such as Help To Buy and Shared Ownership mortgage deals can help first-time buyers.
• With a Lifetime ISA (LISA) as a first-time buyer under 40, you get a 25% bonus on your savings.
• YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
• A stocks and shares Lifetime ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Pocket money

Archie is nearly seven - the age when most parents start giving their children pocket money, according to research by Barclays. And the bank says this is a great time to start teaching youngsters about the value of money. By getting Archie to earn his dough by doing household chores, Liz and Dan will help Archie appreciate the effort that goes into earning money and encourage him to develop a strong work ethic.

Pocket money can be paid in cash or using a prepaid card. There are a number of cards available that are designed specifically for youngsters from companies including GoHenry, Osper and HyperJar. A pre-paid card could also be a gentle way for Liz and Dan to introduce Archie to electronic payments and the world of online banking.

Talking about money

By talking to Archie about money and what they spend it on each month, Liz and Dan can help him to appreciate the kind of ongoing financial commitment involved in buying something like a Saint Bernard puppy or a horse. Archie’s probably too young for them to go through their entire household finances with him. But they can start with a large sum and show him how quickly the figure falls as they tick off all their monthly bills.

Showing Archie how they budget provides a good opportunity to talk about the difference between wanting something and needing something. This will also allow Liz and Dan to introduce the benefits of saving as a way of affording treats and luxuries, after paying for essentials.

Making saving visual

Barclays suggests that making it easy for children to visualise how it’s possible for money to grow can help get them excited about saving. Liz and Dan could do this by giving Archie a clear jar to turn into a homemade piggy bank. Alternatively, they could set up a savings account so Archie can go online to see how additional deposits and interest add up over time.

Budgeting for a big day out

Research by the Bank of England found only a quarter (27%) of youngsters in the UK enjoy school lessons about money. The study revealed kids thought using real money in real situations would help make learning more fun.

Archie wants to take a couple of friends to the zoo for his birthday. This offers a great opportunity for him to use money in the real world. Putting Archie in charge of the budget for the trip may help to increase his appreciation of the value of money. Liz and Dan should agree an amount Archie has to spend and ask him to think about how he’d like to use that money. They’ll need to remind him of all the things that will have to be paid for including fuel, entry tickets, food and drink etc. Allowing Archie to take the lead as much as possible during the trip – by handing over cash or holding up cards to make payments – will help boost his financial awareness and hopefully make learning about money more engaging.

Key takeaways:

• Giving children pocket money for doing household chores can help them appreciate the effort that goes into earning cash and encourage a strong work ethic.
• Talking to children about money helps them to understand budgeting and the difference between essentials and luxuries.
• Making it easy for children to visualise how their money can grow may encourage them to save.
• Putting children in charge of budgeting for a big day out can boost their financial awareness and make them more

Now that the dust has started to settle, what do the recent announcements, and U-turns, mean for you and your finances?

What is still happening

The National Insurance contribution rate will fall from 6 November 2022.

In April 2022, the National Insurance contribution (NIC) rate increased by 1.25 percentage points to pay for additional health and social care services. In April 2023, a new Health and Social Care Levy was set to replace this rise.

In the Growth Plan in September, it was announced that this rise would be reversed from 6 November 2022 – and this will still happen. So, from 6 November 2022, you will pay a lower rate of NI.

The Treasury has said the change will save nearly 28 million people an average of £330 per year. However, the impact varies considerably depending on what you earn.

This measure will also help you if you run a business. The Treasury say that 920,000 businesses will see an average tax cut of £9,600 in 2023/24.

 Stamp Duty has been cut

To stimulate the housing market and to help more people get onto the property ladder, Stamp Duty was cut with immediate effect. Two key measures came into force on 24 September 2022:

The threshold at which Stamp Duty becomes payable rose from £125,000 to £250,000. If you’re moving home, the rise in the threshold will save you £2,500 if you are buying a house valued at more than £250,000.

The threshold at which first-time buyers will start paying Stamp Duty rose from £300,000 to £425,000. The value on which first-time buyers can claim relief increased from £500,000 to £625,000. If you are a first-time buyer paying £400,000 for a property, the cut equates to a £5,000 saving.
The table below shows the savings you would make thanks to the threshold rise, assuming you are not a first-time buyer:

If you’re buying a second home (for example, a holiday home or buy-to-let) you’ll normally pay a 3% Stamp Duty surcharge, but you’ll still benefit from this reduction.

Note that these changes apply in England and Northern Ireland. The devolved governments in Scotland and Wales will make their own decision about whether to pass on cuts in due course.

What is no longer happening

Income Tax cuts to basic and additional rate no longer proceeding

Two Income Tax measures were announced in the Growth Plan:

Bringing forward a 1p cut in the basic rate, meaning the basic rate of Income Tax would reduce to 19% in April 2023.

The abolition of the 45% additional-rate tax band.

Both these tax cuts have been scrapped along with confirmation that the basic rate of Income Tax would remain at 20% “indefinitely until economic circumstances allow for it to be cut”.

The Telegraph reports that reintroducing the 45% tax band means someone earning £200,000 will be £2,500 a year worse off, while someone on £180,000 will miss out on £1,500 in tax savings.

The Times reports that the reversal means someone earning:

• £15,000 a year will miss out on future savings of £24 a year.
• £30,000 will forego a saving of £174 a year.
• Just over the higher-rate threshold, will miss out on a £377-a-year tax cut.
• The BBC reports that, overall and for a typical household, all these policies taken together will mean tax cuts of £290, rather than £500, driven by the scrapping of the rise in NI.

For the wealthiest 10% of households, tax cuts have been reduced from £5,380 to £1,650.

Dividend Tax will remain at its current level

The Dividend Tax rates for basic- and higher-rate taxpayers would have been reduced by 1.25 percentage points, and the additional-rate Dividend Tax rate would have been abolished alongside the 45% Income Tax band.

This decision has also been reversed which means dividend taxation will remain at the current rates of 8.75%, 33.75% and 39.35% for basic-, higher- and additional-rate taxpayers respectively.

If any part of your income is in dividends – perhaps from shares or as a company director – you will continue to pay these higher rates of tax.

Corporation Tax will still rise in April 2023

The Corporation Tax rise, planned for April 2023, was set to no longer proceed in order to “maintain a competitive business tax regime, which will support investment, innovation and economic growth in the UK”.

This policy was also reversed on 17 October with confirmation that Corporation Tax will rise to 25% in April 2023 as previously planned. So, depending on how much profit you generate in your business, your tax bill may rise in April 2023.

The Times reports that this measure is set to raise £18 billion for the Treasury.

2-year support for energy bills restricted to 6 months

In one of the more surprising announcements, the government’s flagship policy to support households facing rising energy costs was stripped back.

One of Liz Truss’s first priorities as prime minister was to shield households from planned Ofgem price cap rises. Truss superseded Ofgem's 1 October price cap of £3,549 with her “Energy Price Guarantee” (EPG) that meant the average annual bill would only be £2,500. She said this guarantee would last for two years.

However, this too has been scaled back to last only until April 2023. A Treasury-led review into how the Government can support energy bills beyond April next year will take place. The review’s objective is to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need.

Consequently, on 1 April 2023, your bills will likely revert to being determined by Ofgem's price cap and wholesale energy prices.

According to Sky News, this will see the average household pay £4,347 a year for gas and electricity from April 2023, instead of the promised £2,500.

How can we help you?

Get in touch with us so that we can work with you to understand the impact of the u-turns and reversals. We’ll ensure we translate all the changes so you can see how your finances will be affected.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Could remortgaging help you beat the cost-of-living crisis?

What is remortgaging?

Remortgaging involves taking out a new mortgage on a property you’ve already bought. You might do this to replace an existing mortgage deal or to borrow money against your home.

Is remortgaging right for Mike?

After Mike’s last mortgage came to an end, he didn’t look for a new deal so he was switched onto his lender’s standard variable rate (SVR). An SVR is usually much higher than fixed and tracker rates, and it can go up at any time. Research by Habito found 27% of mortgage holders in the UK are currently on their lender’s SVR, and they worked out - on an average mortgage - this translates to an extra £340 a month. This means Mike could almost certainly benefit from remortgaging.

Other reasons to remortgage

Even if you’re not on your lender’s SVR, there are a variety of reasons you might want to remortgage:

• To beat interest rate hikes. As inflation goes up, interest rates are starting to follow suit, so it may make sense to lock into a low rate now.
• You’re coming to the end of a deal. Mortgage advisers generally agree you should start looking for a new deal around three to six months before your current rate ends. However, the research by Habito found 46% of mortgage holders are unaware of this.
• The value of your home has gone up. A significant rise in the value of your home may have moved you into a lower loan-to-value band, meaning remortgaging may give you access to reduced rates.
• You want to borrow against your home. Remortgaging may allow you to raise money cheaply on low rates. Before doing this, it’s worth getting financial advice to make sure this really is the cheapest way for you to borrow.
• You want to overpay, and you can’t on your current deal. If you’ve come into some money recently, remortgaging will allow you to reduce the size of your loan and possibly get a better rate. You’ll need to take into account any exit fees or early repayment charges to weigh up whether remortgaging makes financial sense.

Where to start

It’s not always clear cut whether you’ll benefit from remortgaging. A qualified mortgage adviser will look at your circumstances and find out exactly what you want to achieve by remortgaging. For example, are you simply looking to reduce your monthly payments or do you want a more flexible mortgage that allows payment holidays? The adviser will then set out the best options available. Regular mortgage reviews can help ensure you’re never overpaying unnecessarily.

If you’d like to speak to someone about your mortgage, we’re here to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Key takeaways:

• Remortgaging can be useful in a variety of situations from reducing your monthly payments to borrowing money against your home.
• It’s not always clear cut whether you’ll benefit from remortgaging – talking to a qualified mortgage adviser can help you decide whether it’s right for you.
• Regular reviews with a professional can make sure you’re not overpaying unnecessarily on your mortgage.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Pension lifetime allowance – how it affects you
In his 2021 Budget, the Chancellor announced a five-year freeze on the lifetime pension allowance. What does this mean for you and your retirement fund?

What is the lifetime pension allowance?
The lifetime pension allowance sets a limit on how much you can save in your pension before you start paying tax on anything over the limit. For a few years before the 2021 announcement, the limit had been tied to inflation, meaning that it rose in line with the cost of living.

With the global pandemic and surge in inflation over the past couple of years, the decision was made to freeze the limit – at £1.073 million – until 2026. It’s hoped that the freeze will generate additional revenue as savers slow down or stop contributing to their pensions and don’t claim tax relief from the government.

How are my pensions affected by the lifetime allowance?
The lifetime allowance applies to all types of non-state pensions in your name – so that includes any defined benefit (final salary or career average) schemes you have along with any defined contribution pensions.

The limit of £1.073 million might seem like a huge amount. But if you’re a medium-to-high earner, have saved into pensions from an early age and are approaching retirement, you could one of the millions who are affected (and caught unawares) by reaching the threshold.

As pensions are so complicated, seeking advice is important and we can help clarify the status of your pensions, discuss your retirement plans and how to proceed.

What happens if you exceed the lifetime allowance?
Many of us have more than one pension, usually accumulated through different jobs over the years. Keeping track of them and how much they contain can be tricky and time consuming, as you’ll need to look at their expected value when the time comes. Your adviser is best placed to gather this information and help with your next steps.

If your total exceeds the lifetime allowance, the excess amount will be taxed as follows:

• 55% if you receive the amount as a lump sum from your provider

• 25% if your payments are gradual or are cash withdrawals

These are large penalties on your savings, so it’s worth acting now to find a way to protect your hard-earned pension.

Seek help to protect your pension
Protecting your pension and making sure you’re able to live comfortably in retirement and keep up with the cost of living is something we can help with. So, if it looks like your pensions could be affected by reaching and exceeding the lifetime allowance, there are some options you can discuss with your financial adviser:

Divert savings into an ISA You can earn tax-free and make withdrawals in most cases. Our advisers can help you calculate how much you will need to live comfortably in retirement and help plan your investment strategy to achieve that goal.

Combine pensions with your spouse Consolidating your pensions can be an effective way to grow your retirement savings in one place. It can also save time on the administration involved, cut down on fees and create a more streamlined investment strategy.

Claim pension credit Many pensioners are eligible for pension credit but fail to make a claim. It’s available if you are over the state pension age and on a low income, are a carer, severely disabled or responsible for a child. It could boost your retirement income up to £182.60 a week if you’re single, or £278.70 for couples. It’s separate to the state pension, and we can help calculate whether you and your partner are eligible.

Pension allowance protection
Your adviser will be able to assess whether your pension could benefit from protections that help avoid the tax charge by offering a higher lifetime allowance. But there are several conditions and criteria you’ll need to meet. Our experts can advise whether it would be applicable to your situation.

Your adviser is ready to help you navigate the complex area of pension and ensure you move forward in the strongest position for you and your loved ones.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key takeaways

• The lifetime pension allowance sets a limit on how much you can accumulate in all of your pensions before you start paying tax on your funds.
• The government has frozen the limit at £1.073 million until 2026.
• The allowance applies to all types of non-state pensions in your name, and any amount exceeding it will be taxed.

Can you afford to die?

It’s becoming increasingly popular to use humour during services to reflect the personality of the individual being celebrated. A survey by Co-op Funeralcare on the music people would like at their final goodbye found Another One Bites the Dust by Queen, Going Underground by the Jam and Highway to Hell by ACDC were among the chosen tunes.

After the music’s faded, gravestones offer another opportunity to raise a smile long after you’ve gone. One of the most famous examples of a humorous epitaph is Spike Milligan’s ‘I told you I was ill’. Meanwhile, Mel Blanc - the man behind the voices of Bugs Bunny, Daffy Duck, Porky Pig and many others – opted for the famous Looney Tunes sign-off ‘That’s all folks!’ In a similar vein, gameshow host Merv Griffin, who presented Wheel of Fortune in the USA, went with ‘I will not be right back after this message’.

A funeral that captures the essence of the person being remembered can provide some level of comfort to loved ones during an incredibly difficult time. Another way to make things as easy as possible is to have your financial affairs in order.

Whole of life plans

A whole of life plan provides your loved ones with a lump sum when you die. With some policies, you pay monthly or annual premiums until your death, while others allow you to stop paying at a certain age - although this may impact the amount of money your loved ones receive.

Create or review your will

A will allows you to specify how your property, money and possessions will be distributed when you die. If you pass away without a will, the rules of intestacy will determine this for you and may not reflect your wishes. A will can also be used to set out plans for guardianship and any future financial support for your children.

Accounts, bills and policies

Make a list of your accounts, bills and policies to help those left behind. This is important in case there are outstanding debts attracting interest that could be settled. Remember to include:

• Current/savings accounts
• Investments/pensions
• Credit cards/loans
• Mortgages
• Insurance policies
• Paying for your funeral and other expenses

Dying is costly! According to the SunLife (2022) Cost of Dying Report, you’re looking at an average bill of £8,865. This includes:

£4,056 – the average cost of a basic funeral

£2,484 – the average amount spent on extras such as the memorial, death and funeral notices, flowers, order of service sheets, limousines, venue and wake

£2,325 – the average amount spent on legal professionals

A pre-paid funeral plan allows you to set aside money to pay for your funeral. However, these plans aren’t currently regulated. If you’re taking out a policy before 29 July 2022, when they will be regulated, make sure you check the provider’s status on the FCA website. Don’t buy a plan if its status is 'not applying for authorisation', 'application refused' or 'application withdrawn’.

If you’d like more information on estate planning, we’re here to help.

Key takeaways:

• A whole of life plan can provide your loved ones with a lump sum payment on your death.
• An up-to-date, valid will helps to ensure your property, money and possessions are distributed according to your wishes after you die.
• Keep an up-to-date list of your financial assets and debts to help loved ones in the event of your death.

Hardly a day goes by without the cost of living hitting the headlines. For many homeowners, the increasing costs of owning and running a home are having a huge impact on household budgets. For those borrowers with a fixed rate mortgage, the recent increase in mortgage interest rates may not have an immediate impact. However, as mortgages are more expensive now than they were two years ago, you may see your mortgage payments rise when you next come to remortgage.

Overpaying on your mortgage now could save you more on interest down the line and help reduce your mortgage payments. It could also make sense to overpay on your mortgage rather than keep your money in a savings account because you’ll earn more in interest savings on your mortgage than you could earn in a typical savings account.

An overpayment is any additional payment you make over your usual monthly mortgage payment. Overpayments can either be a one-off lump sum or a regular overpayment made throughout the year. Overpaying on your mortgage means you can potentially clear your mortgage balance quicker.

Lenders will offer you better rates if you have a lower loan to value. The more you can pay to reduce your mortgage, the potentially lower interest rates you’ll have when you come to remortgage to a new deal.

Overpaying on your mortgage might not be right for everyone. Using savings to overpay on your mortgage could leave you with less cash to fall back on in an emergency.

Not all lenders have the same rules for overpaying and there may be a penalty fee called an Early Repayment Charge if you overpay too much.

You should only make overpayments if you’re sure you can afford them. It’s a good idea to make overpayments if you already have an emergency fund, and you don’t have any other, more pressing debts that need to be repaid.

We can help guide you through all your mortgage options including advice on making overpayments.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Taking out an offset mortgage enables you to use your savings to reduce your mortgage balance and the interest you pay on it.

Offset mortgages can help you save money over the course of your deal as there’s less interest to pay over the longer term. Interest rates on offset products can be higher than on an equivalent standard repayment deal, but thanks to the savings placed aside, these are charged on a smaller loan amount. This means you will pay less mortgage interest while the savings are offset.

An offset mortgage can help to lower your monthly repayments or lead to earlier repayment of your balance. There is also no tax to pay on the benefit received from an offset mortgage.

We can help guide you through all your mortgage options including whether an offset mortgage is right for you.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Aware the incident could have been much worse, the couple were still left with an enormous mess to sort out. High winds had caused the inside of the chimney to collapse. However, Alex and Megan’s home insurance provider refused to pay for the structural damage because, according to their terms and conditions, the wind hadn’t been strong enough to constitute a storm. They also refused to replace the living room carpet because the couple’s contents insurance didn’t include accidental damage cover.

So, what can you do to make sure your home insurance provides you with the protection you’d expect when the unexpected happens?

Let’s start at the beginning - what exactly is home insurance?

Home insurance financially protects your home against damage or theft but is typically split into two parts – buildings and contents.

Buildings insurance – this covers the building itself, including walls, floors, doors, windows and the roof. It also covers permanent fixtures such as baths, toilets, fitted kitchens and even wallpaper.

Contents insurance – This typically covers anything that can be taken with you if you move e.g. kitchen appliances, furniture and valuables.

Not all home insurance is equal

As Alex and Megan discovered to their cost, not all home insurance is equal. Although tempting to simply go with the cheapest option, it’s always best to check the details of any policy you’re considering seeing exactly what’s included. For example, some buildings insurance covers garages, greenhouses and garden sheds but some policies don’t.

It's also a good idea to check for exclusions. You may find some insurers won’t pay out for anything considered to be the result of general wear and tear or damage that happens over time, such as damp or rot.

Meanwhile, contents insurance generally has a single-item limit, meaning high-value possessions may need to be named separately. You may also have to pay extra to cover belongings when they are taken outside your home.

Add Ons

There are also certain add ons that are worth thinking about to provide a way to get cover without paying for a more expensive policy with features you may not need. These include:

• Accidental damage cover – This provides cover for accidents that occur around your home.

• Home emergency cover – This protects your home against emergency call outs or repairs like a burst water pipe.

• Personal possessions – This covers items that are used away from home such as handbags and mobile phones.

• Legal expenses – This covers the cost of legal proceedings if you need to take action or defend a claim.

Do you really need home insurance?

Homeowners – although buildings insurance isn’t a legal requirement, most mortgage lenders insist on it. No one is going to force you to buy contents insurance but it can provide valuable peace of mind and combining it with your buildings insurance may save you money.

Renters – you don’t need to worry about buildings insurance – this is your landlord’s responsibility. However, contents insurance may be a sensible idea.

Approved by The Openwork Partnership on 25/01/2023.

Key takeaways:

• What’s covered by home insurance varies from policy to policy, so you should check what’s included before making a purchase.

• Check the terms and conditions for any exclusions to make sure you’re getting the cover you need.

• Read reviews before choosing an insurance provider – good customer service can be just as important as cost.

It’s a good idea to know how your investments are taxed when selling them. Here are some of the ways you can organise your assets to make them tax efficient.

One of the worst things about earning money is that you have to pay tax. Whether it’s your salary or the interest you’ve earned on your investments, the taxman will almost always take a chunk. If you sell stocks or bonds for a profit, you may need to pay capital gains tax (CGT). The good news is that if you put your investments in a tax wrapper you can shield them from the taxman. Popular wrappers include Individual Savings Accounts (ISAs), Self-Invested Personal Pensions (SIPPs) and investment bonds

What is CGT?

Investments like shares and bonds that don’t sit inside a tax wrapper are subject to CGT. It’s a tax on the profit you make when something you sell increases in value, such as a second home or shares. The amount you pay will depend on your tax band. Basic rate taxpayers pay 10% in CGT, while higher rate taxpayers pay 20%. It’s important to note that it’s the profit that incurs the tax and not the total price you sell the investment for. Therefore, you only have to pay CGT on your overall gains above your tax-free allowance – known as the annual exempt amount.

When do I need to pay CGT?

If you make a profit when selling investments, you may have to pay CGT. You don’t usually have to pay CGT if you give them as a gift to your husband, wife, civil partner or a charity. You also won’t have to pay CGT when you dispose of:

1. Investments you’ve put into an ISA or SIPP

2. Shares in employer share incentive plans (SIPs)

3. UK government bonds

4. NS&I Premium Bonds

5. Qualifying corporate bonds

6. Employee shareholder shares (depending on when you received them)

How can I save on my tax bill?

Tax will impact the amount you get back from your investments. So if you want to get the highest return possible taking advantage of tax-efficient wrappers is crucial. A tax wrapper is a vehicle that can be put around a portfolio of assets to protect your investments from tax, providing the money stays within the wrapper.

There are different types of tax wrapper, with ISAs and pensions being the two of the most common you will come across. Both offer generous tax benefits that everyone is entitled to. Money put into an ISA account can grow free from tax, meaning you don’t pay tax on capital gains, dividends or income made on any gains from your investments. A self-invested personal pension (SIPP) is a wrapper that allows you to control the specific investments you make in the fund. Just like ISAs, with a SIPP your investments can grow free from capital gains, dividend and income tax.

Insurance bonds

What are the options after you’ve maxed out your ISA and pension contributions? With the CGT allowance shrinking and the tax on dividends increasing, insurance bonds are becoming popular again. They are investments that use insurance policy law. What this means is that the equivalent to CGT is paid within them for you and dividends are untaxed.

The investments that you can hold within them are the same as those that you would have in your ISA or pension. After the 2022 Autumn Statement, the tax case for many people is more in favour of an investment bond than an unwrapped investment (the latter being subject to higher rates of CGT and dividend tax).

How much CGT do you have to pay?

In the 2022/23 tax year you can make £12,300 in capital gains before you have to pay CGT and £6,150 for trusts. Couples can double this by combining their allowances. This means that if you earn profits below this level across the tax year, you don’t have to pay CGT.

However, the capital gains threshold will fall to £6,000 from 6 April 2023. This lower threshold will be in place for a year before being halved to £3,000 in April 2024. As a result, more people will have to pay tax on their investment gains.

Next steps

With the changing CGT rules over the next few years, it is important that any investments you have that aren’t within an ISA, pension or investment bond are reassessed. You can use a tax wrapper calculation tool to work out what is the best route for you, in terms of CGT and dividends.

Actively talking about money can be positive for both you and your loved ones, and research suggests it’s something younger generations are more likely to do. According to Royal London, 76% of 18 to 24-year-olds spoke to their parents about money matters when they were growing up. In contrast, this falls to 43% for those over 65.

If money wasn’t openly discussed during your childhood, it can be hard to change your mindset around the topic. Yet, when you’re planning a future with your partner, your finances will play a critical role. So, if you currently keep your financial planning separate, working together could be useful.

That doesn’t mean you have to share everything or combine finances completely if it’s not right for you. Instead, you could set out how you want to work together with a financial planner.

Bearing all this in mind, here are five reasons you should create a financial plan with your partner.

Understand what you both want to achieve

While you may have talked about your goals in your relationship, setting out a financial plan provides a good opportunity to talk about your priorities and understand if you’re on the same page as your partner. This may include when you’d like to retire, and what your lifestyle will look like when you give up work. Or it could be how you’ll support your wider family or bucket list destinations you want to visit.

Making these goals a clear part of your financial plan means you’re far more likely to achieve them. Without a plan, it can be all too easy for aspirations to fall to the wayside.

Discuss your attitudes to financial decisions

When dealing with finances, it’s important that you’re comfortable with the decisions you make. This applies to both you and your partner if you’re working towards shared goals.

For example, how does your partner feel about taking investment risk? Or what is their attitude to using credit? Talking about these issues can help you create a financial plan that you’re both comfortable with.

It could improve your wellbeing

Money is often linked to stress, and it can affect your overall wellbeing too. Research shows that financial stress can increase later in life. This is understandable as, on top of considering things like mortgage repayments and day-to-day costs, you may also be thinking about retirement or supporting other family members. According to Aviva research, more than 40% of 55 to 64-year-olds say they are “struggling financially”.

A long-term financial plan that incorporates you and your partner’s circumstances and goals can deliver peace of mind.

Have confidence in the future

One of the reasons that the topic of money can be stressful is that you may have questions about the future or wonder what will happen in some circumstances. For example, you might be concerned about the consequences of you or your partner losing your income, or how one of you would cope financially if the other passed away.

Financial planning helps you set out a blueprint, but it also considers how you’d cope if the unexpected happens. By doing this, you can take steps to provide security in these circumstances. By planning together, you can have confidence in both your and your partner’s long-term financial security.

It could help make your money go further

Planning as a couple can make financial sense. Working together could mean you’re able to make the most of tax breaks or allowances.

Which ones are right for you will depend on your circumstances and goals but may include using the Marriage Allowance to reduce Income Tax liability, making use of both of your annual ISA allowances, or contributing to your partner’s pension.

Contact us to create a financial plan for you and your partner

We are here to help you navigate the challenges of creating a tax efficient financial plan and understanding your goals. If you’d like to arrange a meeting with us, please get in touch.

If you have any questions about tax efficient financial planning, please contact us.

The value of your investment can go down as well as up and you may not get back the full amount you invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

With over 10 years of record low interest rates, fixed rate mortgages offer borrowers the stability of knowing what the mortgage payment will be for a set period, which helps with budgeting.

Because of the way many lenders decide what rates to offer, we’re currently seeing tracker products priced a lot more competitively than fixed rate products.

Unlike a fixed rate, the monthly payment of a tracker mortgage fluctuates and the rate charged on the mortgage ‘tracks’ the Bank Rate usually for a set period. Whilst you may have to pay a penalty to leave your lender, especially during the tracker period, there are tracker products that have no early repayment charge, so you are free to leave without penalty.

If you’re coming up to the end of your fixed-rate and you’re faced with a higher interest rate than you were expecting, switching to a tracker at a lower rate may be tempting. Although you may find there are cheaper tracker products on offer than current fixed rates, you must be confident that you’ll be able to afford your repayments if the rate goes up.

We can help guide you through all your mortgage options including advice on whether a fixed rate or tracker product is more suitable.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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© Bank of England 2023

Five practical ways to protect your money during the cost of living crisis

With inflation at its highest level in 41 years and energy prices skyrocketing, the cost of living crisis has dominated headlines since inflation began to creep up from historic lows in mid-2021.

While the Covid pandemic began the inflationary increase, this was further exacerbated by the war in Ukraine pushing up energy and food prices even further.

Following such an extended period of price rises, you may be concerned about your household finances and long-term plans. So, here are five ways to protect your finances during the cost of living crisis.

Review your budget and personal inflation rate

Reviewing your spending will clarify where your money is going and highlight potential areas to cut costs and make savings.

Despite a lot of noise about inflation and its impact on UK households, the good news is that your personal rate of inflation depends on how you spend your money. It won’t necessarily match the official inflation rate and so changing your spending habits can help bring it down.

For example, since much of the rise in prices has been caused by soaring fuel prices, your personal inflation rate may be lower than the average if you don’t drive or own a car.

Energy prices have also risen significantly throughout 2022. However, if your home is especially energy-efficient, you may use less energy than an average household. This could bring your personal inflation rate below the average.

You can use an online calculator – such as this one from the ONS website – to help you work out your personal inflation rate online.

Manage debt

Higher interest rates mean increased borrowing costs. So, check the rates and see if you can reduce the interest you’re paying.

Focus on repaying credit card debt first. Credit cards typically charge high levels of interest and the negative compounding effects can be difficult to escape.

If you have high credit card debt, transferring to a limited-period nil-interest rate account could help you repay the debt sooner.

Ensure your savings are working hard for you

Around £160 billion in savings accounts pay less than 0.5% interest, so it’s worth shopping around for higher interest rates on your savings.

Alternatively, Insignis can help you secure the best cash savings rates.

As interest rates change, Insignis moves your money to secure optimal rates. The one-time sign-up is quick and easy to set up, plus you’ll never need to open or close another account again.

Resist the temptation to dip into your investments or stop saving for your future

You may be tempted to dip into your pension or investments to tide you over but consider the long-term effect on your retirement plans.

Selling investments or drawing from your pension could leave you worse off in the long run, so assess every option before you act.

It’s important to continue to pay your future self first, too; be sure to maintain regular, tax-efficient contributions to your pension and ISAs.

Remember your long-term financial plan

Making rash financial decisions during the current crisis could jeopardise your long-term financial security. If you’re worried about the rising costs of living and what you can do to protect your short- and long-term financial plans, we can help.

Get in touch

If you’re worried about the rising cost of living and would like to discuss ways to protect your finances from the effects of inflation, we’re here to help. Please get in touch to arrange a time to chat.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both.

The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Tax concessions are not guaranteed and may change in the future. Tax free means the investor pays no tax.

Approved by The Openwork Partnership on 14.02.2023

The new tax year commenced on 6 April 2023 so its a great time to review your finances.

The new tax year means annual allowances are reset and ready to be reused – to help you make the most of your money. This year more than ever, with interest rates and inflation on the rise, it’s a great time to review your pensions and investments.

Note: The following figures apply to the 2023/2024 tax year, which starts on 6 April 2023 and ends on 5 April 2024.

ISAs

The maximum you can invest across your ISAs is £20,000 (if it’s a cash ISA, stocks and shares ISA or innovative finance ISA). For a lifetime ISA, the annual allowance is £4,000.

Junior ISAs

If you’re looking to put some cash aside for your children, Junior ISAs (JISAs) are a great option and often come with higher interest rates when compared to high street savings accounts. In the new tax year, you can save or invest up to £9,000 in a cash JISA, a stocks and shares JISA, or a combination of the two.

Pension allowance

Your personal pension contribution allowance is £60,000, although it can be lower for higher earners and where pension savings have been flexibly accessed already. Any contributions you (or your employer) make receive tax relief from the government (based on your income tax band) of 20% or more – and the money in your pension pot will grow tax free.

Child’s pension

A child’s pension can be set up by a parent or guardian, but anyone can contribute. You can pay up to £2,880 in the new tax year into a pension on behalf of a child and the government automatically tops this up with 20% tax relief on the total amount contributed, taking the figure up to £3,600.

Gift allowances

A financial gift is a great way of using tax-free allowances.

Making a cash gift can help a loved one (and help with your estate planning). Everyone has an annual gifting limit of £3,000 that is exempt from inheritance tax (IHT). This is known as your annual exemption. If you fail to use it one year, you can carry it over to the next tax year.

It’s worth remembering that any gift you give, even to family members, could be subject to capital gains tax (CGT). CGT is the tax you pay on any profit or gain you make when you dispose of an asset, such as a second home or shares. If you gift an asset and it has risen in value compared to what you have paid for it, you could be liable to CGT. The CGT allowance for the new tax year is £6,000. This is the amount of profit you can make before CGT is applied.

Marriage allowance

Married couples or those in civil partnerships may be able to share their personal tax allowances. To be eligible, one partner must earn less than the Personal Allowance threshold of £12,570, and the other must be a basic rate taxpayer. The lower earner can transfer £1,260 of their tax-free allowance to their partner, reducing the tax paid by up to £252 a year.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Key Takeaways:

1. A new tax year means annual allowances are back to zero and ready to be filled or topped up, to make the most of your money.

2. The maximum you can invest across your ISAs is £20,000.

3. Your pension contribution allowance for the new tax year is £60,000.

4. The Capital Gains Tax allowance is £6,000 for the 2023/2024 tax year.

5. A financial gift is a great way of using tax-free allowances.

6. Married couples or those in civil partnerships may be able to share their personal tax allowances.

Higher interest rates and the rapid increase in the cost of living are likely to be affecting many areas of your finances. The start of the year is the perfect time to think about any concerns you may have and to ensure you’re making the most of your money.

Savings

After many years of low rates, savings accounts have made a substantial comeback following a series of interest rate rises from the Bank of England throughout 2022. Yet with inflation rocketing, the value of your money is shrinking in real terms so it’s important to maximise every penny of interest in order to mitigate the impact. There are a few things you can do. For example, you could make your savings work even harder by paying more into an ISA. Investing is another route if you have longer-term goals and you don’t need to access the money for at least the next few years.

Loans and credit cards

Rising interest rates can also push up the repayments on any debts, including bank loans, car finance and credit cards. If you have a personal loan or car finance agreement, you probably agreed a fixed deal – so the latest rate rise is unlikely to affect you until the term of the agreement comes to an end.

Investments

When it comes to your investments, it’s important not to react to any ups and downs in your portfolio and avoid making emotional decisions that could cost you in the long run. Staying invested and having a diverse portfolio spread across a variety of assets (like stocks and bonds) and geographical regions can help soften the blow if one area suffers in uncertain times. Whenever possible, you should remain focused on your long-term financial goals.

Pensions

Your annual tax-free pension contribution allowance is £40,000, although it can be lower for higher earners and if you’ve already accessed your pension savings. Any contributions by you (or your employer) receive tax relief from the government of 20% or more – and the money in your pension pot will grow tax free. You may be eligible if you are still registered with the pension scheme and have earned in the current tax year the amount you (or your employer) would like to contribute.

Mortgages

If you have a fixed-rate mortgage then your rate of interest is set until the initial fixed term ends. After this, you could end up paying more if you have a tracker mortgage – which tracks the Bank of England base rate – or standard variable rate (SVR) mortgage set by your lender. You may also want to review or change your product, which could save you money however there may be fees involved when changing your mortgage product. If your finances allow, you may want to start making overpayments on your mortgage. It could help bring down your overall mortgage amount, which means you’d be paying less interest on it. This is another area where you can decide whether it’s a beneficial move and can check the small print in your mortgage agreement to see if it’s allowed.

Here are some other things to consider when giving your finances a spring clean:

1. Estate planning: Have you written a will or thought about how you’d like to pass on your assets? Are you interested in income protection, reviewing your life insurance or putting a health or financial power of attorney agreement in place?

2. Insurance: When your car and home insurance policies are up for renewal this year, you may be able to save on your premiums by switching providers.

How much do I need to save?

A 5% deposit of the property value is the minimum amount you are able put down, however your options may be limited. The larger deposit you can provide, the less risk you will be considered to lenders and better rates will be available to you.

Where do I start?

Set a savings goal, which you can break down into easier amounts and a time frame to achieve it. Regular saving is most effective and it’s important to be realistic about how much you can save monthly so that it’s more attainable and doesn’t feel like such a chore or impact your life severely. Researching house prices in the area you would like to buy your property and using mortgage borrowing calculators online can help you work out how much you may need to save.

Savings accounts options

There are many ways of saving for your deposit. Look around and think about what you want to achieve and how quickly. With a Lifetime ISA (LISA), if you’re a first-time buyer under 40, you get a 25% bonus on your savings. For example, you can deposit up to £4,000 each tax year and receive a government bonus of £1,000 on top, meaning you would have £5,000 at the end of the tax year. It could help you reach your deposit goal quicker.

Top tips on how to build your savings:

1. Set up a savings account – Look into a suitable ISA and consider a Lifetime ISA.

2. Look at your current spending habits –See where you can possibly reduce your monthly bills and expenditure (e.g. minimise unused subscriptions/gym membership, change energy or network providers, eating out, daily coffees etc.) to save money.

3. Create a budget and stick to it – Make the budget realistic so it’s easier to stick to and when you struggle, remember the goal in mind. Set up standing orders so the money is automatically allocated to savings before you have chance to spend it.

4. Reduce your rent/living costs – If possible, consider moving in with family, friends or find cheaper/shared accommodation which can allow you to save money quicker.

5. Make extra money – Sell clothes or items online that you don’t need, or if you have a skill/talent/craft that you can turn into a business, this can help you earn extra cash.

6. Make use of discounts, vouchers and online deals – Every little saving helps.

7. Try “no spend” months or weekends” – Only pay your bills, regular outgoings and necessities and move the money you save to your savings. Consider alternative free activities.

8. Set limits – If it helps, take out a certain amount of money in cash for the week or month and leave your cards at home.

9. Consider investing options – Including saving accounts with higher interest rates such as stocks and shares ISAs.

10. Ask for help and advice – From friends and family for support and we’re here for any financial advice you may need.

We’re here to help you save or invest your money to build your deposit. We will make sure your savings and investments are working for you and advise you on how much you can borrow for a mortgage. We’ll also be here to help find the right mortgage deal when you are ready to buy your first home!

If you would like to find out more, please get in touch with us.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

A stocks and shares Lifetime ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Approved by The Openwork Partnership on 17/03/2023.

Key Takeaways:

1. A 5% deposit of the property value is the minimum you can put down.

2. Set yourself a savings goal, which you can break down into easier amounts and a time frame to achieve it.

3. With a Lifetime ISA (LISA) as a first-time buyer under 40, you get a 25% bonus on your savings.

4. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

It’s understandable to see why. Fixed rate mortgages give borrowers stability – you know exactly how much you’re paying each month, for a set period of time, and can budget accordingly.

And after over a decade of low interest rates, fixed-term mortgage deals have become the go-to for many homeowners. However, this doesn’t necessarily mean they are the right choice for everyone.

There are plenty of other mortgages on the market, such as life-time trackers, green mortgages, or offset mortgages. And until you delve a little deeper, you might not be able to make an informed choice. An expert mortgage adviser can help you do just that.

Spotlight on the tracker mortgage: the flexible option

One of the mortgage options on the market is a tracker mortgage – a mortgage that follows the Bank of England Base Rate, usually with a fixed percentage added on top. If the Base Rate drops, so will the mortgage rate, and vice versa.

A key benefit of a tracker mortgage is flexibility. When it comes to fixed rate mortgages, lenders will review the lending market over a specific timeframe. Then they’ll work out what they believe will be the average lending rate over that period. After they have acquired that fixed price, they will pass it onto fixed rate products.

However, tracker products cut out the need to predict, as they follow the Bank of England Base Rate in real time. Unlike a fixed rate mortgage, the amount you pay per month could change, as the mortgage ‘tracks’ the Base Rate over two or three years. As a result of this, we sometimes see lenders price their tracker products much more competitively than their fixed rate options.

The pros and cons of a variable rate

The competitive pricing on tracker mortgages may make them cheaper than their fixed rate counterparts, especially if you’re coming to the end of your fixed rate term and you’re faced with a higher interest rate than you were expecting.

Tempting as this is to switch to a tracker with a lower rate, it’s crucial to make sure you can afford to pay your monthly repayments if the rate goes up in future!

It’s also worth bearing in mind that there are some tracker mortgages that don’t have an early repayment charge, so you are free to leave without penalty. However, this is not the case for all of them, so consider which product you choose carefully, as you may have to pay a penalty fee for leaving early.

Plan your next remortgage steps with an adviser from Blue Heron Financial Services 

If you are unsure about remortgaging, seek mortgage advice from an expert. We have our fingers on the pulse of the mortgage market and are equipped with in-depth knowledge of the different mortgage products on offer. Our insider knowledge can make your remortgaging process simple, so are you ready to find the right mortgage for you? Speak to us today.

Approved by The Openwork Partnership on 27/04/23

5 ways saving little and often could help you grow your wealth

When it comes to investing your money, making small regular investments can provide more benefits than investing a lump sum. Through regular investing, you can invest a small amount into the markets every month. Investing little and often is a great habit to develop and instil in younger family members, too. Instead of saving up a chunk of money to invest in one lump sum, investing this way can make a significant difference to your overall levels of wealth over the longer term. One big benefit of investing a small regular sum is that, instead of saving your cash until you have a lump sum, you're putting your money to work straightaway. Even with rising interest rates, leaving money sitting in a bank account can be less profitable than investing it in the market.

1. Form a healthy and potentially profitable habit

Investing regularly helps you to build good habits and keep you committed to a long-term investment strategy. No matter how little you put away, over time, your steady and regular investment should build up.

A good way to start is to invest a fixed portion of your income every month. Then, as your income fluctuates over your working life, simply adjust the amount you’re saving in line with the amount of money you are making.

2. Limit your exposure to one-off events and benefit from pound cost averaging

Global stock markets can be unpredictable and volatile. They move up and down frequently, sometimes sharply. This is why, when investing in stocks and shares, it's important to take a long-term view – usually at least five years.

Saving regularly means you can benefit from “pound cost averaging” and this helps smooth out the market’s peaks and troughs. Although there’s no guarantee of this, the theory is that when markets are low, you acquire more shares or fund units for your money, and when markets are high, you acquire less.

So, by drip-feeding your money into an investment over a period of time, you will inevitably end up investing across a range of prices. In effect, you should pay the average price over a fixed period, which can help to reduce your risk and, potentially, provide smoother returns.

3. Reap the rewards of compound growth

Compound growth is one of the most powerful and underrated benefits of long-term investment.

Investing small amounts of money each month could mean you start investing sooner. And the sooner you start investing, the longer your money will be exposed to the growth potential of both being in the markets and from compounding.

The powerful effects of compound growth mean that even small sums add up and can help make a big difference later down the line.

As you might imagine, compounding has its largest impact during the latter stages of your investment journey; 5% growth on £100 is only £5, but 5% growth on £1,000 is £50.

So, if you want to reap the rewards of compound growth, start early, and establish (and maintain) a good savings habit.

4. Instils good investing discipline

Some people hesitate over when to invest money and attempt to time the best moment to buy in to the market. This approach is incredibly difficult and even seasoned fund managers don't try to time the market.

In fact, professional investors and fund managers with large sums to invest will often drip-feed their funds into the market over time.

If it's good enough for the experts, it a great approach for novice investors!

5. Pick up potential bargains

When stock market prices start to fall, many people panic. They will often sell their investments and, when spooked by market changes, many investors may refuse to re-enter the market until things settle down.

Because fear can sometimes drive prices artificially low, this is often the best time to buy into the market. So, adding to your investment at these times may mean that you enjoy larger returns when the markets rally.

If you find it difficult to remove emotion from investing and struggle to benefit from market downturns, regular investing can help by removing the emotional element of buying into the stock market.

Get in touch

If you’re interested in finding out more about how you could invest your money wisely and potential profit from long-term growth through regular investing, we’re here to help.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Past Performance is not a guide to future performance and should not be relied upon.

Approved by The Openwork Partnership on 18/05/2023

Five options that could help you make your pension stretch further.

Household bills have increased rapidly during the past year. The current cost of living crisis began with the Covid pandemic, causing problems for economies around the world and creating global supply chain delays. The war in Ukraine simply heightened an already difficult situation. Following such an extended period of price rises, you may be concerned about your household finances and long-term plans. If you are retired and rely on a defined contribution (DC) pension for your income, read on for five options that could help you make your pension stretch further.

1. Use existing savings for income

If the value of your DC pension has fallen recently, one way to help it to recover could be to keep as much of it invested as possible. Consider whether you could live on less income than you are currently taking.

Using alternative savings or investments could help reduce the amount you need from your pension. By leaving your money invested in your pension, you’ll retain more fund units, which may increase in value when markets recover.

When things are looking better, if you have depleted your emergency fund you could use some of your income to rebuild it gradually. This will provide a buffer to support you if markets drop again in the future.

2. You could take a phased retirement

Many people are choosing to take a phased retirement to fight the effects of the cost of living crisis. This might include:

1. Taking a part-time job

2. Setting up your own business or working as a contractor

3. Staying in your old job but on reduced hours.

Continuing to work means you could contribute more to your pension, helping it to grow further.

Keep in mind that the Money Purchase Annual Allowance (MPAA) might limit the amount of tax relief you can receive. Once you start drawing income flexibly from your pension, you can only receive tax relief on contributions up to £10,000 a year, although you can make contributions over this amount.

You could also receive your State Pension payments alongside any income you make from work once you reach State Pension Age. If you are struggling to cover your monthly expenses, this could provide a welcome boost to your income.

We can help you understand all the financial implications of phased retirement and pension contributions.

3. An annuity could provide guaranteed annual income for the rest of your life

If you would like a guaranteed annual income but don’t want to go back to work, you could consider an annuity.

Buying an annuity with a lump sum from your pension can deliver a guaranteed annual income for the rest of your life.

Annuities are becoming an attractive option for retirees again. Rates have risen to a 14 year high in 2022, meaning you can now get much more for your money.

For example, in December 2022 a 65-year-old with a pension pot worth £100,000 could secure a guaranteed income of £6,873 a year for life.

The same person would only have been able to receive £4,521 a year if they had bought the annuity at the start of 2022.

4. A lifetime mortgage could free up cash from your home

A lifetime mortgage is a loan that you take out against the value of your home, allowing you to exchange equity for tax-free cash. To be eligible, you must:

1. Be over 55

2. Own your home, which must be worth/valued at more than £70,000

3. Have little or no mortgage left to pay

4. Be a UK resident.

Benefits of a lifetime mortgage:

1. You retain ownership of your home.

2. The cash can be used to pay for anything.

3. You don’t need to repay the loan, or the interest accrued, until you move into long-term care or pass away.

Disadvantages of a lifetime mortgage

1. Interest will be charged on the original loan and the interest accrued, so the amount you owe will grow.

2. The interest rates on lifetime mortgages tend to be higher than on residential mortgages.

3. You may have less to leave your beneficiaries in your will.

5. Downsize your home to reduce monthly bills

Moving to a smaller property with a better Energy Performance Certificate rating could offer a win-win situation.

Not only could this help free up some cash from the sale of your old property, but a smaller, more efficient home could also reduce monthly bills.

Get in touch

If you’re worried about the rising cost of living and would like to discuss ways to protect your finances from the effects of inflation and rising energy prices, we’re here to help. Please get in touch to arrange a time to chat.

Important Information

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Past Performance is not a guide to future performance and should not be relied upon.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes, which cannot be foreseen.

A Lifetime Mortgage is not suitable for everyone and may affect your entitlement to means tested benefits, so it is important to seek financial advice before taking any action. If you are considering releasing equity from your home, you should consider all options available before equity release.

The interest that may be accrued over the long term with a Lifetime Mortgage, may mean it is not the cheapest solution. As interest is charged on both the original loan and the interest that has been added, the amount you owe will increase over time, reducing the equity left in your home and the value of any inheritance, potentially to nothing.

Although the final decision is yours, you are encouraged to discuss your plans with your family and beneficiaries, as a Lifetime Mortgage could have an impact on any potential inheritance. We would also encourage you to invite them to join any meetings with us so they can ask questions and join in the decision, as we believe it is better to discuss your decision with them before you go ahead.

Approved by The Openwork Partnership on 18/05/2023

Getting on the housing ladder can feel like one of the hardest and longest processes in the world and the cost of living crisis is probably not helping. You need to come across as attractive buyers for lenders to consider you, but there are many factors that can reduce how much lenders are willing to let you borrow for your home.

How do lenders decide whether to offer you a mortgage?

If you’re applying for a new mortgage, remortgaging or increasing your current mortgage, lenders are required to carry out an affordability assessment. This involves a variety of checks designed to make sure you can afford to repay what you borrow. According to the Independent, some two thirds of first-time buyers are rejected for a mortgage at their initial attempt. So, what can you do to boost your chances of passing an affordability assessment?

Evidence stable employment

Many lenders ask for three years’ proof on income, although some will accept less. Even simply switching from one employed position to another can affect your chances of success. Some lenders like to see that you’ve been with an employer for at least three to six months before they’ll consider you.

Reduce your debts

Lenders will look at your total income and then work out how much you need to maintain a basic standard of living. This will give them an idea of how much you can afford to spend on a mortgage. Reducing the amount you owe on things like credit cards and loans will increase the amount you have available and boost your chances of passing an affordability assessment.

Check your credit report

Before offering you a mortgage, lenders check your credit report. A poor credit history could affect the amount they’re prepared to offer or cause them to turn you away altogether. However, there are simple ways to improve your credit rating. Before applying for a mortgage, check your credit report for errors, , avoid applying for new credit in the six months leading up to the application and make sure you’re well within any existing credit limits.

Get professional advice

Finding the right mortgage is important so we can assess your circumstances and get the right deal for you. We can save you the headaches and ensure you’re less likely to be turned down for a mortgage.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Approved by The Openwork Partnership on 16/03/2023.

 Check what mortgage you could afford with our mortgage calculator

Key takeaways:

1. Lenders like to see that you have a stable income so it’s best to avoid changing your work situation in the time leading up to a mortgage application.

2. Reducing the amount you owe on credit cards and loans can help improve your chances of securing a good mortgage deal.

3. Lenders will check your credit report before offering you a deal so make sure yours is up to scratch before submitting a mortgage application.

4. Professional advice could boost your chances of passing an affordability assessment.

5. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

• With inflation remaining stubbornly high the Bank of England has once again chosen to raise the Base Rates, this time by 0.5% to 5%.
• The Bank of England has opted for a 0.5% Base Rate rise.
• The Bank of England has raised the Base Rate to 5%.
• The Bank of England raised the Base Rate by 0.5% to 5%, the 13th rise since December 2021 when the Base Rate was just 0.1%.
• In changing times investors should keep a cool head and a well-diversified portfolio. Omnis spread your investments across different asset classes, global regions and styles which can smooth returns and reduce the risks to which you are exposed.
• With the Bank of England raising Base Rates 0.5% to 5% diversification can help you through market uncertainty that may emerge
• The 2023 investment outlook from Omnis Investments can be helpful to understand dynamics at play, including interest rates, when it comes to markets and your portfolios https://omnisinvestments.com/news/2023/omnis-2023-outlook
• The rise in the BoE rate to 5% was predicted in the markets and comes on the back of ECB (European) rate rise last week. But this is at odds with Fed (US) leaving the rate unchanged. The long-term forecast is for inflation to fall this year, but as inflation is proving harder to reduce the Bank has again, increased rates today.
• The Bank of England has raised the Base Rate 0.5% to 5%. Did you know 57% of fixed-rate mortgages in the UK which are coming up for renewal in 2023 were fixed at interest rates below 2%.
• The Bank of England has raised Base Rates again to 5%. If you have a fixed rate mortgage, your monthly payments won't be affected right now.
• The Bank of England has again raised the Base Rate. If you have a tracker mortgage linked to the Base Rate, you will already have seen an increase to your monthly payments and are likely to see further rises.
• The Bank of England has again raised the Base Rate. If you have a variable rate mortgage, you may have seen an increase to your monthly payments. Your lender will be in contact explaining the new rate and what you can expect to pay.
• 2.4 million fixed-rate mortgage deals are ending between now and the end of 2024. A typical two-year fixed mortgage deal now has an interest rate of more than 6% and a five-year fixed rate is now at 5.67%.
• Offset mortgage rates can be slightly higher than two- and five-year fixed-rates. However, an offset mortgage allows you to reduce the interest you pay each month by linking your savings.
• Those wishing to secure all or part of their long-term retirement income will be heartened by the increasing rates.
• With continued Base Rate rises annuity rates have reached a 14-year high.
• Both secured and unsecured borrowing can be affected by the interest rate rise. Review your budget to see if you can cut back on non-essentials or even overpay any debts.
• Annuity rates are based on the long-term price of government bonds which in turn are closely linked to the long-term expectation of the Base Rate.

The pros and cons of both to give you an idea of the kind of things you’ll need to consider.

Is it better to gift a property or leave it in your will?

Before passing away, Maggie gifted her house worth more than £700,000 to her son Bruce but still remained living there, paying a token amount of rent. Nine years later, following Maggie’s death, Bruce was surprised to be landed with an inheritance tax bill for the property.

 What did Maggie do wrong?

Maggie knew if she died within seven years of gifting Bruce her house that he may well end up paying inheritance tax on it. She also knew enough to pay Bruce rent after gifting him the property. However, the amount she paid was well below the market rate and this is where she fell foul of inheritance tax laws. By only paying a token amount of rent, the house remained part of Maggie’s estate and Bruce was hit with a hefty inheritance tax bill.

How to decide whether to gift a property or leave it in your will?

There are no easy answers to this. There are a lot of complicated tax rules to consider and the best approach will depend on your individual circumstances. Whatever the situation, it’s an important decision and one best made as a family. We’ve looked at the pros and cons of both to give you an idea of the kind of things you’ll need to consider.

Leaving a property in your will

The first thing to do is find out the residence nil rate band (RNRB) allowance for the property in question. If, like Maggie, you’re leaving your main home to a child or grandchild, they’ll benefit from an extra £175,000 tax-free allowance on top of the standard £325,000. This means you could leave an estate worth up to £500,000 and there’ll be no inheritance tax to pay. And if you and your spouse are leaving a joint estate, that doubles to £1m. The benefits of leaving a property in your will are that you’ll retain control of it, it isn’t generally at risk from anyone else’s divorce, death, or bankruptcy and, currently, there’s no capital gains tax to pay for the beneficiary.

Gifting a property

If, as in Maggie’s case, the property is worth more than the RNRB, you may want to consider passing full ownership to a child. You then need to move out or, as Bruce found out to his cost, pay rent at the going market rate. There are many reasons people choose to gift a property: to minimise inheritance tax; to provide financial help to loved ones sooner rather than later; or to avoid care home fees. If you’re considering it for the latter reason, you should be aware that anti-avoidance rules are designed to stop people doing this. If you gift a property, you’ll lose control of it. But once the transfer of ownership takes place, so begins the seven-year countdown for removing the property from inheritance tax liability.

Right sizing

Another option for improving your quality of life into old age and helping the kids out at the same time is right sizing. In other words, selling the family home and buying somewhere that is easier to manage and better suits your needs as you get older. This option generally releases equity, which can be used to give loved ones a financial boost while you’re still alive. Alternatively, you could investigate a lifetime mortgage as an option for releasing money to gift away now.

Insuring against inheritance tax

Another possibility Maggie could have considered is taking out whole of life insurance. This would have provided a tax-free lump sum on death to cover Bruce’s inheritance tax bill. Writing the policy into trust would have ensured any payout wasn’t included as part of Maggie’s estate.

However, policies can be expensive and HMRC would have treated the premiums as a lifetime gift if Maggie paid them herself. Bearing this in mind and considering Bruce would have been the person to benefit from the insurance cover, it would have made sense for him to pay the premiums if he was keen to go down this road.

Key takeaways:

1. When deciding whether to gift a property or leave it in your will, you need to focus on what you’re trying to achieve

2. The benefits of leaving a property in your will are that you’ll retain control it for the rest of your life, it isn’t generally at risk from anyone else’s divorce, death or bankruptcy and, currently, there’s no capital gains tax to pay for the person who inherits it.

3. Gifting a property can be used to minimise inheritance tax and allow you to provide financial support to loved ones before your death.

4. Right sizing may improve your quality of life and release equity.

5. It’s possible to insure against inheritance tax but it can be expensive so it may be more appropriate for beneficiaries to pay the premiums.

6. Professional advice can help you and your loved ones understand the various implications of the different options and allow you to make informed decisions.

Worried about mortgage lenders withdrawing their products and deals?

The mortgage market is going through another unpredictable time with mortgage lenders withdrawing mortgage deals and increasing rates in a reaction to the recent news that inflation is slowing at a less- -than-expected rate.

Do you need to remortgage now?

If you’re due to remortgage now, don’t panic! The good news is that help is at hand.

Despite the recent withdrawal of some mortgage products and rates, we still have access to thousands of mortgage rates and can search an extensive panel of lenders for you, finding deals and options that you may not have even considered. We’ll also be saving you hours of searching time and mortgage comparison headaches.

Speaking to an adviser can help during these unpredictable times

If you’re worried about remortgaging, seek mortgage advice from an expert. We have our fingers on the pulse of the mortgage market and are equipped with in-depth knowledge of the different mortgage products on offer. Our insider knowledge can make your remortgaging process simple, so are you ready to find the right mortgage for you? Speak to us today.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Approved by The Openwork Partnership on 12/06/2023

Your circumstances have changed – will you be able to remortgage?

We all know life doesn’t stay the same. Our jobs, our relationships, our financial circumstances, they all evolve over time. So if our lives are constantly changing, why should our mortgage stay the same?

Your life may have completely altered since you last remortgaged. You might be earning more or less than before, earning from multiple sources, or become self-employed. You might even be looking to climb onto the property ladder as a first-time landlord.

Or you might be worried about how a County Court Judgement (CCJ) or past mortgage defaults might affect your credit rating, and your ability to remortgage this time round.

The good news is that help is at hand. With careful planning, and an in-depth review of your mortgage options, an expert mortgage adviser could help you secure a mortgage that fits your circumstances.

We’ve put together some common remortgaging myths below. If you think these might hold you back from securing a mortgage, think again – we might be able to help you find a mortgage for your specific situation.

Myth: you won’t be considered for a mortgage if you’re earning your income from multiple sources.

It could be overtime payments, earning commission or a bonus, returns from your investments or simply the fact that you’re working more than one job – it’s becoming less likely for people to earn their income from just one source. You may think that because your income doesn’t fit into a standard template, you won’t be able to find a mortgage. But this isn’t the case!

We have access to and can search the specialist market on your behalf. With our help, you may be able to find a mortgage as unique as you are.

Myth: if you’re self-employed, you have to wait three years or more before you can be considered for a mortgage.

That’s not always the case. With access to an exclusive panel of lenders, we can connect with specialists on your behalf. So don’t feel you’re automatically written off if you’ve been trading for just a year. It’s possible we can source a mortgage for you.

Myth: lenders will only accept buy-to-let mortgage applications if you already have a mortgage.

Often, first time buyers will take out a residential mortgage and change it to a buy-to-let mortgage, which builds up their credit rating. But while it helps to already have a mortgage in place, it’s not an absolute necessity. You may have never needed to take out a mortgage because you’re living with a partner or parents. Whatever your circumstances, don’t let them put you off. Speak to an adviser, as they can help you find the right lender and guide you through the mortgage process.

Myth: you won’t be able to get a mortgage if you’ve recently had a County Court Judgement (CCJ) or defaulted on your mortgage payments in the past.

Whilst it’s true this could affect your mortgage deal, there are specialist lenders out there that will look at your individual circumstances. Certain factors will be taken into consideration, such as how long ago the CCJ or default happened, or whether you’ve had any trouble with your finances since then. An expert adviser will be able to help you through the process, so while it may feel daunting, it’s absolutely doable!

Whoever you are, seeking advice is a good thing.

Whatever your situation, it makes sense to get a helping hand from a mortgage adviser. We look at all circumstances and have access to a wide range of mortgages: from those not on the market, to those that are only available from specialists and sometimes harder to track down. An expert in your corner can find a solution that’s completely tailored to your needs.

Ready to get started? Speak to an expert adviser today.

Approved by The Openwork Partnership on 05/05/23

This video provides an easy explanation from Rohit Vaswani, Client Portfolio Manager, on the importance of having a long term horizon, to allow your money to grow and achieve your financial objective.

This video provides an easy explanation on investing for growth and value. 

Why plan ahead of your fixed rate ending?

The earlier you plan your remortgage, the more mortgage options you have! And in the current economic climate, it really does pay to know your options. An expert adviser can find the deal for you.

If you’re due to remortgage in the next year or so, take a look at our handy list of does and don’ts that will help you plan ahead with confidence.

• DO give yourself time to weigh up your options. Leaving anything to the last minute can be incredibly stressful – even more so when it’s something as important as your mortgage! Take a weight off your shoulders and give yourself plenty of time to look at what’s available – it’s worth speaking to an adviser so you can get the ball rolling.

• DON’T accept the first deal you find. Keep an open mind, it can be very tempting to snap up the first mortgage you see that looks good. But there are so many different mortgages out there – some of which you might not even have considered! We’d recommend getting the help of an expert adviser to help you find the right deal. Which brings us to…

• DO seek the help of a mortgage adviser to help with the search and application process. There are so many mortgage options on the market, it can feel a bit overwhelming. With the help of an expert adviser, you can choose with confidence. We’ll help you through the whole remortgaging process – from choosing a good fit, to going though the small print and completing the process. Plus, we’ll save you time spent searching, as well as mortgage comparison headaches.

• DON’T assume you have to stay locked in a deal before you remortgage. If you secure your rate early and then find an option that suits you better, you can change your mind and go for the new deal.The vast majority of lenders won’t lock you into a deal before your expiry date, which gives you the best of both worlds. If rates rise after you’ve chosen a deal, you will have secured the most competitive one available and should hold onto it throughout the mortgage application process. If rates reduce, your adviser will inform you and simply switch to a lower rate before you complete. Either way, you can sit back and relax, knowing we’ll have you covered.

• Do think long term. Early Repayment Charges (ERC) apply when you want to repay your mortgage early or pay your overpayment allowance. In some cases, paying the ERC (at 1% or 5%)* and securing a new rate straight away might actually save you money in the future. This is because you won’t be waiting until rates have increased, which could affect your next mortgage product.

• Don’t default! If your current mortgage expires and you haven’t got another option in place, you’ll automatically roll onto your lender’s default rate – often at a higher standard variable rate. Avoid spending money where you don’t need to, and make sure you get in touch with a mortgage adviser. We can help you get another mortgage option in place when your current one expires.

 Get a head-start on the remortgaging process with an adviser from [insert company name here].

Whatever stage you’re at in the remortgaging process, a mortgage adviser can expertly guide you on your way. We’ll compare a huge range of lenders and mortgages on your behalf, finding a solution that’s completely tailored to your needs.

Ready to plan your next remortgaging steps? Speak to an expert adviser today.

Approved by The Openwork Partnership on 28/04/23

The cost of living crisis has dominated the headlines since inflation began to creep up from historic lows in mid-2021. While the Covid pandemic began the inflationary increase, the situation was made worse by the war in Ukraine, which pushed up energy and food prices even further. Following such an extended period of price rises, you may be concerned about your household finances and long-term plans. If you want to understand how you can tweak your expenses and finances to best protect your wealth through the cost of living crisis, read on for three practical tips.

1. Keep calm and carry on protecting yourself

It can be easier said than done, but even when your bills are rising and things are looking a bit worrying, staying calm and thinking objectively about your finances really is the best way to approach the challenge.

You might be tempted to start cutting down on your expenses, but one thing it’s really important not to cut is your financial protection.

Research has revealed that 1 in 7 people in the UK are considering cancelling their life insurance policies to save money during the cost of living crisis.

Removing a monthly expense such as a life insurance or income protection premium might feel like a smart move in the short term. But things could become even more challenging if you were to fall ill and not be able to work for a few months or longer. If this were to happen when you’d cancelled your cover, you might struggle even more without the potential pay out from your policy.

If you are struggling to pay your monthly expenses, it’s important to reach out and talk to an expert. We can help you to see your finances more clearly and to create a plan of action that takes you from worrying about money to feeling in control.

2. Reducing debt might be the best place to start

If you want to boost your financial wellbeing, it might be best to begin by reducing your debts to lenders.

If you have high levels of debt, your monthly payments could be one of your most costly expenses. If you have some savings, reducing or eliminating the amount you owe could help free up money to be deployed more usefully elsewhere.

High-interest debt is often tied to credit card debt. If you’re carrying a long-standing balance from month to month it could be costing you dearly every month.

To illustrate the potentially damaging effects of interest on debt, if you have £1,000 sitting in a savings account earning 1% interest, you’re only making £10 a year. If you have £1,000 on a credit card at 18% interest, you’ll be paying £180 a year. Using your savings to pay off the debt will mean you are £170 a year better off.

In short, the sooner you can cancel out debt the better.

If you have debt in multiple places, you might want to consider consolidating them.

There are various options for consolidating debt, but the right solution will depend on your individual circumstances. We can help you understand which course of action might be most suitable for you.

3. There might be some easy cost savings that will reduce your monthly bills

Once these bigger things are taken care of, you can look for some smaller actions you could take to reduce your monthly expenses. Review your bank statement to identify anything that you no longer need. Things to look out for include:

• Streaming services that you rarely or never use

• Subscriptions that you don’t get value from

• Gym memberships that you don’t use

• Delivery fees for online shopping.

Given the sharp rise in energy costs this year, it may also be helpful to consider how you could use energy more efficiently in your home to save costs.

The Energy Saving Trust reports that the average UK household spends £65 a year powering appliances on standby mode. So, remaining vigilant about turning off appliances like TVs or games consoles when you aren’t using them could help to save money across the year.

Additional savings could be made by installing and fully utilising the features of a smart thermostat; the average installment cost is £215. The Energy Saving Trust estimates that a typical household could save £180 a year by using a smart thermostat so that your heating only comes on when you need it.

By identifying and plugging these “money leaks”, you may be able to reduce your monthly expenses without having to slash spending on the things you enjoy.

Get in touch

If you’re worried about the rising cost of living and would like to discuss ways to protect your finances from the effects of inflation and rising energy prices, we’re here to help. Please get in touch to arrange a time to chat.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Approved by The Openwork Partnership on 18/05/2023

As a parent, providing for your children is a top priority – from making sure they have food on the table, to ensuring they have the extras they need in life.

Putting income protection in place means you’ll always be able to support your children with a regular income if the unthinkable should happen and you’re unable to work because of serious illness or injury.

Keeping your family financially healthy.

In the past two years, 13% of workers have had two months or more off work due to either illness, injury or a mental-health event1. As a parent, your children depend on you financially. But should you become ill or injured and unable to work, would your family be able to manage without your income?

Would your family be able to cover all the essential monthly outgoings – not to mention the extras you’re used to having?

In a two-parent family, even with a safety-net of sick pay and savings, you might struggle to keep up with your regular outgoings on one income, especially if you’re not well enough to go back to work for a substantial amount of time.

Financial struggle for your family is the last thing you need when you’re trying to recover from a medical condition.

Are you a one-income family?

It’s also worth bearing in mind that becoming a parent may mean you now only have one income if one parent is staying at home for childcare purposes. Protecting this main source of income is essential, as is the case with one-parent families. With the rising cost of childcare and bills, the need to protect your family against financial difficulty is more important than ever.

Income protection can give you the support you need, when you need it most.

By protecting your family this way, you can get help with mortgage payments, bills and food, as well as clothes, transport and leisure – protecting not just your essential outgoings, but your family’s lifestyle too. Putting income protection in place alleviates the risk of financial instability by providing your family with a regular source of income, so you have the peace of mind that your children will be provided for until you get better.

Find out what works for you with an adviser from Blue Heron Financial Services 

Income protection can be discussed with your adviser – so you can make sure you have the right protection in place to protect you and your family’s financial future.

Approved by The Openwork Partnership on 03/07/2023.

Expiry date – 04/06/2024

Now those are some little things that can make a big difference.  Healthy benefits included for you and your family?  

Protection policies aren’t just there for when things go wrong. Many protection insurers include access to a range of health and wellbeing support services – and you don’t need to claim to be able to use them.

These services can make everyday life that little bit easier. From knowing you can have immediate professional support if your child falls ill, to having the tools to keep tabs on your health, these services provide advice, assistance and information to keep you and your family healthy.

Which types of services could you get with your cover?

Here are some of the health and wellbeing services you could get with your policy. Please be aware that not all insurers include these, so it’s well worth making sure you speak to your adviser to make sure you have the right cover in place for you and your family.  

• Access to an online GP
• Nutrition consultants
• Mental health consultants
• Online physiotherapy
• Health MOTs
• Nurse healthlines
• Fitness apps
• Second medical opinion service
• Bereavement support
• Legal support

A few good reasons to use these health services:

• The majority of services are free

You don’t need to claim on your policy to use them and they can be used regardless of pre-existing conditions.

• They are easy to use and convenient

Many of these services are available for you to book online at a date and time to suit you. They are also easily accessible, whether via an online consultation, an app, or a helpful professional on the end of the phone.

• They are provided by experts

The support you receive is provided by medical and health experts.

• They are good for your health and wellbeing

From serious illness to everyday healthcare support, fast access to expert advice and support can be included in your protection policy.*

Many customers have seen the benefits, for example, one of our insurers reported that in 2022, 99% of GP appointments were offered within 2 hours of a customer contacting them. They also saw the demand for these appointments increase by 126% from the previous year showing that wider emotional, health and family support services can really make a difference in people's lives.

With the NHS feeling pressure like never before, knowing your family’s health is covered can give you extra peace of mind.

Here’s one little thing you can do today, talk to an adviser from Blue Heron Financial Services to discuss the healthy extras available for you and your family

Health and wellbeing services can be discussed with your adviser when you’re considering a protection policy. By looking at the needs of you and your family, we can help you get the right protection in place.

Ready to get started?  Get in touch with us 0207 429 0279 or info@blueheronfinancialservices.co.uk

Approved by The Openwork Partnership on 27/06/2023.

Expiry date – 25/06/2024

1. Provide access to a wide range of products and services from The Openwork Partnership, including investments, mortgages, and insurance policies, tailored to your family’s needs.
2. Together, we’ll create a financial forecast that answers important questions about your money today and reveals the possibilities for tomorrow.
3. Develop investment strategies specifically tailored to your financial goals, risk tolerance, and time horizon.
4. We’ll regularly review and adjust your financial forecast to ensure our plan stays on the right track.
5. Identify well-governed and regulated products and services that align with your goals.
6. Help you prepare for life’s twists and turns in advance.
7. Provide financial coaching, guiding you through market news and events so you can make informed decisions.
8. Empower you to seize opportunities that arise and enhance your wealth and financial security.
9. Extend the advice to different generations of your family, ensuring they too are well-prepared for the future.
10. Collaborate with trusted professionals like accountants, solicitors, and other specialists to ensure the solidity of your financial outcomes.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Approved by The Openwork Partnership on 5 July 2023

A little change you can make today can safeguard your biggest investment – your home

If you’re a homeowner, your mortgage payments are likely to take up a large part of your income each month.

You’ve made sure that your loved-ones will have financial protection to cover the mortgage you leave behind if you were to die with life insurance but what about if you became seriously ill or injured, and unable to work? Would you be able to keep up your mortgage repayments?

Statistically, you’re much more likely to be diagnosed with a critical illness than die during your working life. For example, a man aged 40 is 4.1 times more likely to be diagnosed with a critical illness than die before retiring at 65 years old.

As buying a home is likely to be your biggest investment, it pays to protect yourself, so you’re covered should you die as well as if you become too ill to work.

We know the little things in life can be life-changing. It could be a phone call from the doctor with serious news about your health, or a stepladder that wobbled once too often when you were standing on it – serious illness and injury can happen when we’re least expecting it.

How would you pay your mortgage if you were too ill to work?

There are different types of insurance available which can provide financial protection. These include income protection which provides a monthly income if you’re too ill to work and critical illness which pays out a tax-free lump sum if you’re diagnosed with a specific serious illness or injury.

It will be a huge relief to you and your loved-ones to know that you will still be able to pay your mortgage and other essential bills if you are too ill to work, leaving you to focus on what’s important – getting better.

Here’s one little thing you can do to protect your financial future, so get in touch with an adviser from Blue Heron Financial Services today

Your different options can be discussed with your adviser – so you can make sure you have the right protection in place for you and your family.

Call us on 020 7429 0279 or drop us an email:  info@blueheronfinancialservices.co.uk

Approved by The Openwork Partnership on 11/07/2023.

Income and Expenditure

Tracking how much money you bring in and how much you spend can give you an accurate picture of where you could cut back, and conversely where you can spend more.

Debt

Knowing how much debt you have, whether it's your mortgage, credit cards or loans helps you make informed decisions about your spending, budgeting and saving.

Credit Score

Knowing your credit score is an important part of monitoring your financial health.  You should know what yours is, but also what that means in practice.

 Should I save or invest, what's the difference?

Saving is building up a financial cushion in case of an emergency to save for a specific goal, such as a deposit payment on a house or new car. You earn interest on your savings account, but the interest rate can be low.

Investing can include stocks, bonds, funds and other investments. When you invest you are taking on some risk, because the value of your investments can go up or down. However, the potential rewards of investing can be much higher than the interest you earn on savings