Money magazines for September now online

1. The DIGITAL personAL fInAnce mAGAzIne sepTemBer/ocToBer 2009
Planning your Financial
protection for you
retirement income
Maximising an income from your pension fund
and your family
With the abundance of choice, we can
help you make the right decisions
Emerging markets The search
Do they have the potential to lead the recovery
when the world economy begins to stabilise? for income
Investing for an income
Are you taking advantage in a low interest
rate environment
of your ISA allowance?
The earlier you invest, the longer your money
is outside the reach of the taxman
Transferring
your pensions
Your questions answered
Wealth management
Aiming to preserve your wealth and
shelter it from the burden of higher taxes

2. 14 06
Financial 26 24
planning is
our business. 13
We’re passionate about making sure Inside this issue
your finances are in good shape. 05 Corporate bonds 10 Are you taking advantage of 20 Investing in uncertain times
Attracting investors for all the right
reasons
your ISA allowance? In a low growth environment, which
areas offer the best prospects?
The earlier you invest, the longer your
money is outside the reach of the
Our range of personal financial planning services is 06 Self-Invested Personal Pensions
Why astute investors are talking to
taxman
21 Dates for your diary
Don’t miss these deadlines or submitting
extensive, covering areas from pensions to inheritance
matters and tax-efficient investments.
us about taking control of their own
investment decisions 11 Planning your retirement
income
your 2008/09 tax return
08 Wealth management
Aiming to preserve your wealth and
Maximising an income from your
pension fund
21 Locating a lost pension
Tracing service may provide the help
you need!
Contact us to discuss your current situation, and we’ll shelter it from the burden of higher taxes
12 Transferring your pensions
provide you with a complete financial wealth check. 08 Taxpayers allocated incorrect Your questions answered
22 Buy-to-let landlords acquiring
more properties
tax codes
Have you had too much tax deducted
from your wages?
14 What type of investor are you?
Building a solid investment strategy
Interest rate cuts tempting property
investors back in to the market
through good and bad times
08 Emerging markets 24 Long-term care
Do they have the potential to lead the
recovery when the world economy
16 Financial protection for you and
your family
There is no panacea when it comes to
paying for care
begins to stabilise? With the abundance of choice, we can
help you make the right decisions
26 Experiencing mortgage
repayment problems?
09 The search for income
Investing for an income in a low interest rate 19 Inheritance tax planning
Keeping your hard-earned assets out of
It’s essential to talk
environment
the hands of the taxman
28 Data Bank
Tax facts, do you know your numbers?
03

3. 16
Creating wealth
Inside
this issue
W
elcome to the latest issue of our
personal finance and wealth
management magazine. Achieving
the standard of living you require
during your retirement will largely depend on
the choices you make when considering how
to take an income from your pension fund.
On page 11 we consider some of the options
21 22
that may be appropriate to your particular
situation and the degree of control you want
over your pension.
With so many different protection options
available, making the right decision to protect
your personal and financial situation can seem
overwhelming. On page 16 we look at the
plethora of protection solutions which could
help ensure that a lump sum, or a replacement
income, becomes available to you in the event
that it is needed.
If you are an income-seeking saver in search
of good returns from your savings in this low
Corporate bonds
interest rate environment, turn to page 9 to
find out how we can provide you with the
professional advice you need to enable you to
consider all the options available.
At the time of going to press, the global
financial crisis and events have been changing
very quickly, and some further changes are likely
to have occurred by the time you read this issue.
A full content listing appears on page 3.
Content of the articles featured in this
Attracting investors’ for all the right reasons
publication is for your general information
and use only and is not intended to address
your particular requirements. They should Corporate bonds are a type of fixed interest When held within a trust or fund, ‘fixed Over the coming
not be relied upon in their entirety and security. A fixed interest security is a way of interest’ does not mean ‘fixed income’. Corporate
shall not be deemed to be, or constitute, ‘lending’ money to a company in return for a bonds offer different rates of interest and mature years, if the yields
advice. Although endeavours have been from corporate bonds
08
fixed rate of interest over a set period. This type at different times. Money may be invested
made to provide accurate and timely
information, there can be no guarantee of investment is intended to provide you with a into, or withdrawn from, a fund that invests in outperform the returns from
regular, reliable income. corporate bonds. The income levels from trusts
that such information is accurate as of the
date it is received or that it will continue to Over the coming years, if the yields from corporate vary because bonds are continually bought
cash, corporate bonds could
be accurate in the future. No individual or bonds outperform the returns from cash, corporate and sold by the fund manager at different rates. become an increasingly
company should act upon such information
without receiving appropriate professional
bonds could become an increasingly larger part of Yields are used to indicate the income levels larger part of investors’
investors’ portfolios. This will largely be dependent received from corporate bond trusts.
advice after a thorough examination of
on the state of the economy, unemployment levels, The value of your capital in a corporate bond
portfolios.
their particular situation. We cannot accept
29 19
responsibility for any loss as a result of interest rates and future tax rises. fund is not guaranteed and can vary. In addition,
acts or omissions taken in respect of any Every bond issued by a company is given a the value of your investment is likely to fall if
articles. Thresholds, percentage rates and credit rating by an agency such as Morningstar or interest rates begin to rise in the medium to
tax legislation may change in subsequent
finance acts. Moody’s. These credit rating agencies assess how long-term, but on the flip side, it is likely to
likely it is that the company will be able to make increase in value if interest rates fall.
the interest payments and repay the capital. The
most secure rating is an AAA rating. The value of investments and the income from
When you invest into a corporate bond fund, them can go down as well as up and you may not If you consider that corporate
To DISCuSS Your FInAnCIAL you are lending your money to companies who
agree to pay you an amount of interest over
get back your original investment. Past performance
is not an indication of future performance. Tax
bonds still look undervalued
PLAnnIng rEquIrEMEnTS or To a certain period of time. Corporate bonds are benefits may vary as a result of statutory change and and would like to discuss the
oBTAIn FurThEr InForMATIon, issued at different rates of interest by different their value will depend on individual circumstances. options available to you, please
PLEASE ConTACT uS. companies. Generally speaking, the more secure
a company is, the lower the interest rates it will
Thresholds, percentage rates and tax legislation may
change in subsequent finance acts.
contact us to discuss your
need to offer to attract investors. particular requirements.
04 05

4. retirement retirement
Self-Invested
Personal Pensions S
IPPs are wrappers that into a SIPP, there are a number relevant earnings and receive different pensions under the one
provide individuals with of important considerations you full tax relief on the total, subject SIPP wrapper by transferring a series
more freedom of choice than should discuss with us first. These to a maximum earnings limit of of separate schemes into your SIPP.
other conventional personal will include the potential charges £245,000 in 2009/10. If you were to However, it is important to ascertain
pensions. They allow investors to involved, the length of time you invest more than your earnings but if there are any valuable benefits in
choose their own investments or have to retirement, your investment within the annual allowance you your existing schemes that would
appoint an investment manager to objectives and strategy, your would not receive any additional be lost on such a transfer. The actual
look after their portfolio. existing pension plan guarantees tax relief. Where the total pension transfer costs also have to be taken
Why astute investors are talking to us about taking As a SIPP investor you have the
option of choosing when, where and
and options (if applicable) and the
effects on your money if you are
input amount exceeds the annual
allowance a tax charge of 40 per
into consideration, if applicable.
control of their own investment decisions how you invest the assets of your
pension fund. Contributions that
transferring from with-profits funds.
If you are an expatriate living
cent of the amount in excess of the
limit will be levied.
SIPPS are not appropriate for
everybody and there are alternative
methods of saving for retirement.
you make to your SIPP will currently overseas or hoping to move Contributions can be made by
Following the introduction of Pension Simplification legislation in 2006, Self-Invested Personal Pension Plans receive tax relief of between 20 per overseas in the very near future, employers, employees and the
cent and 40 per cent, depending on then it may also be worth self-employed. Where previously The value of investments and the
(SIPPs) have become more accessible to more sophisticated investors who require greater control over their which personal tax band you are in. considering a Qualifying Recognised employees in a company pension income from them can go down
You have to appoint a trustee as well as up and you may not get
pension planning and want greater access to different investment markets. They also offer excellent tax planning
to oversee the operation of your As a SIPP investor you have the option back your original investment. Past
solutions, and in these current difficult financial markets provide for the appropriate investor the maximum SIPP, but having done this you can
of choosing when, where and how performance is not an indication
then effectively run your pension of future performance. Tax benefits
amount of flexibility when planning for retirement. fund according to your investment you invest the assets of your pension fund. may vary as a result of statutory
requirements. The range of available Contributions that you make to your SIPP will change and their value will depend
investments will depend largely on currently receive tax relief of between 20 per on individual circumstances.
your choice of SIPP provider – we Thresholds, percentage rates
can discuss this with you to ensure
cent and 40 per cent depending on and tax legislation may change
that you select the most appropriate what personal tax band you are in. in subsequent finance acts.
scheme provider. Transferring your pension will
Ultimately it is down to the Overseas Pension Scheme (QROPS). scheme who earned more than not guarantee greater benefits in
trustees of your pension plan to A QROPS is a pension scheme set £30,000 were not permitted also to retirement.
agree whether they are happy to up outside the UK that is regulated contribute to a SIPP, they are now
accept your investment choices as a pension scheme in the country free to do so, provided that they
into the SIPP. The trustees are in which it was established, and it do not exceed the limit of 100 per
responsible and liable for ensuring must be recognised for tax purposes cent of their earnings, up to the
that the investment choices fall (i.e. benefits in payment must be maximum earnings limit.
within their remit. A fully fledged subject to taxation). The procedure Alternatively, an employer can
SIPP can accommodate a wide for overseas transfers has been also make an annual contribution
range of investments under its simplified significantly since April of up to £245,000 in 2009/10 on
umbrella. However, you are likely 2006. Now, as long as the overseas behalf of an employee regardless
to pay for the wider level of choice scheme is recognised by HM of their remuneration.
with higher charges. Revenue & Customs as an approved There are charges associated with
At its most basic, a SIPP can arrangement, the transfer can be SIPPs, these include, the set-up fee
contain straightforward investments processed in the same way as a and the annual administration fee.
such as cash savings or government transfer to a UK scheme. A low-cost SIPP with a limited range
If you would like to
bonds. You can also include unit and There is in fact no financial of options, such as shares, funds and
investment trust funds, and other limit on the amount that you can cash, might not charge a set-up fee arrange a review of
more esoteric investments such as contribute to your SIPP, although and only a modest, if any, annual fee. your current retirement
commercial properties and direct there is a maximum amount on A full SIPP will usually charge provision and discuss
share investment. Other options which you will be able to claim a set-up fee and then an annual
are derivatives, traded endowment tax relief in any one tax year and fee. The charges are usually a flat the options available to
policies and shares in unquoted a lifetime allowance restricting rate, so they benefit investors with you, please contact us.
companies. So investments held the total fund size. Under the larger pension pots. There will,
within your SIPP wrapper can range rules which came into force from in addition to annual charges, be
from low to high risk, but crucially April 2006, investors now have transaction charges on matters NeeD MORe
cannot include a second home or
other residential property.
much more freedom to invest
money in their SIPP.
such as dealing in shares and
switching investments around.
INFORMATION?
If you are considering transferring You can make contributions If appropriate, you are also
PLEASE CONTACT US
your existing pension money of up to 100 per cent of your net permitted to consolidate several
WITH YOUR ENQUIRY.
06 07

5. Wealth creation
Wealth
management
Aiming to preserve your
wealth and shelter it from
the burden of higher taxes
The search for income
Making sense of your planning objectives
and finances requires even more time and
effort in today’s constantly fluctuating
economic environment.
With the reduced rate of economic growth
and the impact of the recession, a review
of your financial and tax planning position
could enable you to lower or even defer tax
that you have to pay, enabling you to free up
Investing for an income in a low interest rate environment
cash for other investment purposes in your
business or personally.
If you are an income-seeking saver in search of good returns from your savings in is by investing in stocks that pay a dividend. If
a firm is making good profits it can decide to
There is no substitute for personal advice. If this low interest rate environment, we can provide you with the professional advice share this with investors rather than reinvest it
you would like to discuss the range of personal in the business, so essentially dividends are the
and business planning services that we offer,
you need to enable you to consider all the options available. In addition, we can investors’ share of company profits. Share prices of
please contact us for further information. help you determine what levels of income you may need and work with you to companies that regularly pay dividends tend to be
less volatile than other companies, but remember
review this regularly as your requirements change. Another major consideration that company shares can fall in value. In addition,
Emerging markets
is your attitude towards risk for return and availability. This will determine which dividends can be cut if a company finds itself in
Taxpayers allocated
need of extra cash.
asset class you are comfortable investing in. Another way to invest in equities for the
incorrect tax codes
purpose of obtaining a better income is via an
C
ash, especially in the current climate, is income (called the coupon) and a lump sum at equity income fund. The fund manager running
an important element for any income maturity (called the par). They typically perform the portfolio selects a wide range of equities, so
investor. One option you may wish to well as the economy slows and inflation falls. you are less reliant on the performance of any
Have you had too much tax Do they have the potential to lead the recovery when the world discuss with us is cash funds, dubbed Government bonds tend to move in the one particular company, and will try to select
companies that pay regular dividends.
deducted from your wages? economy begins to stabilise? ‘money market’ portfolios. These use the pooled
savings of many investors to benefit from higher
opposite direction to shares and historically
are good diversifiers. But on the flipside, the
rates not available to individuals. They can invest government is likely to issue more gilts and this
T
HM Revenue & Customs (HMRC) owes he term emerging markets appeared first stormy and volatile past, rallying and slumping far in the most liquid, high-quality cash deposits and large supply may lead to falls in gilt prices. As If you would like to discuss how
hundreds of millions of pounds to as many as during the 1990’s and is now widely used more violently than the developed world. ‘near-cash’ instruments such as bonds. But, unlike government bonds pay a fixed income stream, the you could generate more income
4.5m British taxpayers after allocating them to describe countries not considered to be a normal deposit account, the value of a cash real value of these payments erodes if inflation
from your savings in this low
with incorrect tax codes. developed. Third World, lesser developed fund can fall as well as rise, although in theory, at rises. Similarly, the value of bonds typically falls
With world markets remaining interest rate environment, please
The National Audit Office estimates the countries or under-developed countries. Developed least, it should not experience volatile swings. when interest rates rise.
department could be liable to repay £1.6bn meaning essentially the major European countries volatile, it is important to make Bonds are a form of debt, an ‘IOU’ issued by Corporate bonds operate under the same contact us. We’ll ensure that you
to taxpayers who had too much tax deducted plus USA, Canada, Japan, Australia and New Zealand. sure that your investment either governments or firms looking to raise principle as gilts, in other words companies issue
make an informed decision based
from their wages. In recent months emerging stock markets portfolio is continually meeting capital. As an investor, when you purchase a debt (bonds) to fund their activities. High-quality,
There were 20m queries about tax codes in have reached levels last seen before the collapse bond you are essentially lending the money to well-established companies that generate lots on the options available to you.
March this year, up from around 16m last year. of the Lehman Brothers investment bank. The
your specific requirements. To the government or company for a set period of cash are the safest corporate bond issuers and
ongoing rally has been due to a returning belief arrange a review of your particular of time, which varies according to the issuer. their bonds are known as ‘investment grade’. The value of investments and the income
Make sure that you pay the right in ‘decoupling’, the theory by which emerging situation, please contact us. In return you will receive interest, typically High-yield bonds are issued by companies from them can go down as well as up and you
markets will in future be less dependent on the paid twice a year, and when the bond reaches that are judged more likely to default. To attract may not get back your original investment.
amount of tax, and claim back fortunes of developed markets because they will maturity you usually get back your initial investors, higher interest is offered. These are Past performance is not an indication of future
money that may have been be able to rely on stronger domestic demand. The value of investments and the income from investment. But you don’t have to keep a bond known as ‘sub-investment grade’ bonds. performance. Tax benefits may vary as a result
overpaid, please contact us for Asia and Latin America haven’t had the recent them can go down as well as up and you may not until maturity. You can, if you wish, sell it on. The risks related to investing in bonds can be of statutory change and their value will depend
fundamental problems in the banking sector that get back your original investment. Past performance Much of the government’s debt, including the reduced if you invest through a bond fund. Here on individual circumstances. Thresholds,
further information. the developed world has had, so lending and is not an indication of future performance. Tax additional money being used to aid the economy the fund manager selects a range of bonds, percentage rates and tax legislation may change
credit growth have resumed rapidly and this is benefits may vary as a result of statutory change and and refinance the banks, is in the form of bonds so you are less reliant on the performance of in subsequent finance acts.
helping drive growth. their value will depend on individual circumstances. it issues. Gilts are bonds issued by the British one company or government. The ‘distribution
NeeD MORe Emerging markets, particularly China, have seen Thresholds, percentage rates and tax legislation government. The advantage of gilts is that the yield’ gives a simple indication of what returns
are likely to be over the next 12 months. The
INFORMATION?
strong demand for recent initial public offerings, may change in subsequent finance acts. If you government is unlikely to fail to pay interest or
many of which have raced higher in the style of the invest in funds which invest abroad, movements in repay its debt, so they are generally the safest ‘underlying yield’ gives an indication of returns
PLEASE CONTACT US dotcom boom, raising fears that another bubble currency exchange rates may cause the value of your investments. To date, the UK government has after expenses if all bonds in the fund are held
WITH YOUR ENQUIRY. could be forming. Emerging markets have had a investment to go up or down. never failed to pay back money owed to investors. to maturity.
Government bonds pay a known and regular An alternative route to generating income
08 09

6. Wealth creation retirement
Planning your retirement income
Maximising an income from your pension fund
T
he earliest you are currently permitted to an unpredictable and possibly falling retirement do not want to buy an annuity with their pension
take your retirement benefits is from the age income worries you, then conventional annuities fund. ASPs are intended to provide an income
of 50, but this is set to rise to age 55 from may be more appropriate. in retirement for scheme members and their
April 2010. If you are considering setting up a dependants, rather than be used as a device to
Are you taking advantage
conventional-lifetime annuity, which pays a secure pass on tax-privileged pension funds.
income for life, there is now no requirement to buy Unsecured Pension (formerly
an annuity by the age of 75. However, you must Income Drawndown)
start to take your benefits from the age of 75, in If you are approaching retirement
addition to any tax-free element. Under the option of Personal Pension Fund
and would like to discuss the
of your ISA allowance?
Withdrawal, you can choose to take a tax-free cash
The options lump sum immediately and then, instead of buying options available to you, please
Conventional-Lifetime Annuity
an annuity, leave the remainder of the fund in a contact us.
tax-efficient environment. An annual income (taxed
A conventional-lifetime annuity converts your as earned income) can be taken, within prescribed
pension fund into an income for the rest of your life, limits, from the invested pension fund. This is a The value of investments and the income from
however long you live. You can add different options flexible option which may be a consideration for them can go down as well as up and you may not
The earlier you invest, the longer your money is outside of the reach of the taxman and purchase different types depending on your
needs and circumstances. For example, your annuity
more substantial funds or if you have other sources
of income. This allows you to take a taxable income
get back your original investment. Past performance
is not an indication of future performance. Tax
can pay out to your spouse or partner on your directly from your fund, leaving the remainder benefits may vary as a result of statutory change and
By investing earlier in the tax year, you could make sure that you are using your Individual Savings Account death, or you can choose an enhanced or impaired
life annuity, which may give a higher income than
invested. It is available up to age 75. their value will depend on individual circumstances.
Thresholds, percentage rates and tax legislation may
(ISA) allowance to its full advantage. The earlier you invest, the longer your money is outside the reach of a conventional annuity if you have an illness or Phased Retirement change in subsequent finance acts.
medical condition, or are a smoker. A conventional- Phased retirement is a personal pension plan
the taxman and has the opportunity to work harder for you. lifetime annuity is the simplest retirement option and allows you to buy an annuity or income
and provides a secure, taxable income which is drawdown in stages rather than all at once. It is
ISAs are virtually tax-free savings, a cash ISA to a stocks and shares pay tax at 40 per cent on your payable for the rest of your lifetime. up to you to decide how much income you need
which means that you do not have ISA, but they must transfer the savings interest If you would like to and when you would like to start taking it. You
to declare any income from them, whole amount saved in that tax n if you pay the ‘saving rate’ of tax discuss how planning then cash in as much of the plan as necessary to
and you can use an ISA to save cash year in that cash ISA up to the day for savings, outside an ISA you Investment-Linked Annuity provide your chosen level of income. You can take
or invest in stocks and shares. of the transfer would pay tax at 10 per cent on
ahead and making Investment-linked annuities offer the chance to out a phased retirement plan any time after the
n the money transferred is then your savings interest the most of your ISA obtain a higher level of income, but you need age of 50 (55 from April 2010).
What can you save or treated as if it had been invested n if you’re a basic rate taxpayer allowance early could to be comfortable with linking your income in
invest in an ISA? directly into the stocks and shares inside or outside an ISA you pay retirement to the stock market. They may be Alternatively Secured Pension
mean you benefit from
ISA in that tax year, the saver is tax at 10 per cent on dividend suitable if you have other income sources, are from age 75
ISAs can be used to: then still able to save or invest the income, this is taken as a ‘tax the potential of greater prepared to take a risk to achieve a higher income
n save cash in an ISA and the remainder of their £7,200 annual credit’ before you receive the returns before the end or can accept the risk that your income may The government’s A-Day pensions simplification
interest will be tax-free ISA investment limit in that tax dividend and cannot be refunded reduce. Investment-linked annuities are designed legislation, which came into force in April 2006,
of this tax year, please
n invest in shares or funds in an ISA, year, including up to £3,600 in a for ISA investments to give you the opportunity to obtain an income created Alternatively Secured Pensions (ASPs).
any capital growth will be tax-free cash ISA n if you’re a higher rate taxpayer contact us. that increases during your retirement. If the risk of ASPs are available to people reaching age 75 who
and there is no further tax to pay n from October 6, 2009, the ISA you would normally pay tax on
on any dividends you receive limit will increase to £10,200, up dividend income at 32.5 per The value of investments and the
to £5,100 of which can be saved cent, in an ISA you won’t get income from them can go down
Transferring money from in cash for people aged 50 or over back the 10 per cent dividend as well as up and you may not get
cash ISAs to stocks and n from April 6, 2010, the ISA limit tax credit element of this, but back your original investment. Past
shares ISAs will increase to £10,200, up to
£5,100 of which can be saved in
you will save by not having to
pay any additional tax
performance is not an indication of
future performance. Tax benefits may
If you have money saved from a cash for all ISA investors vary as a result of statutory change and
previous tax year you can transfer Capital Gains Tax (CGT) their value will depend on individual
some or all of the money from a How much tax will you savings circumstances. Thresholds, percentage
cash ISA to a stocks and shares ISA save? rates and tax legislation may change in
without this affecting your annual If you make gains of more than subsequent finance acts.
ISA investment allowance. Interest from savings: £10,100 from the sale of shares
Money saved in the
n if you pay tax at the basic rate,
outside an ISA you would usually
and certain other assets in the tax
year 2009/10, you would normally
NeeD MORe
current tax year: pay 20 per cent tax (2009/10) on have to pay CGT. However, you do INFORMATION?
your savings interest not have to pay any CGT on gains PLEASE CONTACT US
n savers are able to transfer money n if you pay tax at the higher rate, from an ISA. WITH YOUR ENQUIRY
saved in the current tax year from outside an ISA you would usually
10 11

7. retirement
Transferring your pensions
Your questions answered
There are a number of different reasons why you may wish to consider transferring your
pension schemes, whether this is the result of a change of employment, poor investment
performance, issues over the security of the pension scheme, or a need to improve flexibility.
You might well have several proceeding with a transfer. Here Q: Will I lose any benefits? maintain the balance of your portfolio.
different types of pension. The gold are some of the most common A: It is possible that your current It is also possible that the amount of
standard is the final-salary scheme, questions we are asked by our clients pension may have valuable benefits risk you are prepared to take could
which pays a pension based on considering this course of action. that you would lose if you were change over time, for example, if your
your salary when you leave your job to transfer out of it, such as death financial situation changes or as you
and on years of service. Your past Q: Will the new pension be more benefits or a Guaranteed Annuity get nearer to retirement.
employer might try to encourage expensive than my existing one(s)? Rate (GAR) option. A GAR option is
you to move your pension away A: If the new pension costs more, where the insurance company will
by boosting your fund with an you must make sure you are satisfied pay your pension at a particular rate, While transferring your
‘enhanced’ transfer value and even that any additional costs are for which may be much higher than the pensions may seem
a cash lump sum. good reason. For example, if the rates available in the market when
However, this still may not new pension is offering you access you retire.
like a good idea, it is a
compensate for the benefits you to more funds than your current decision that requires
are giving up, and you may need an pension(s), consider whether Q: Are there any penalties if I professional advice
exceptionally high rate of investment you need them. You will receive transfer?
return on the funds you are given information about the costs of the A: Some pensions may apply a
before any action is
to match what you would get if you new pension in the Key Features penalty when you transfer out. taken. If you would
stayed in the final-salary scheme. Illustration (KFI) that is provided to like to discuss your
Alternatively, you may have a you. The Key Features Illustration Q: Would a stakeholder pension
particular requirements,
money purchase occupational refers to the actual funds and meet my needs and objectives?
scheme or a personal pension. These investments that you will be using in A: Stakeholder pensions are often please contact us.
pensions rely on contributions and your new pension. the cheapest pensions available
investment growth to build up a and, if appropriate, this could be an The value of investments and the
fund. When you retire, this money Q: Is it a good idea to transfer all option to consider. income from them can go down If appropriate to your
can be used to buy an annuity which of my pensions into a single new as well as up and you may not get
pays an income. pension? Q: Will the investments in the new back your original investment. Past
particular situation, it
If appropriate to your particular A: If you currently have several pension be right for the amount of performance is not an indication of may make sense to bring these
situation, it may make sense pensions and are looking to put risk I am prepared to take? future performance. Tax benefits may pensions under one roof to
to bring these pensions under them into one new pension, you A: We can explain the different vary as a result of statutory change and
benefit from lower charges,
one roof to benefit from lower need to fully understand the funds and investments and make their value will depend on individual
charges, and aim to improve fund associated costs. You may not recommendations so that the circumstances. Thresholds, percentage and aim to improve fund
performance and make fund necessarily need a new pension to investments chosen are appropriate rates and tax legislation may change in performance and make
monitoring easier. put all of your pensions together. for the amount of risk you are subsequent finance acts. Transferring fund monitoring easier.
If one of your existing pensions prepared to take with your money. your pension will not guarantee greater
Transferring your pension already meets your needs and benefits in retirement.
Pension transfers are a complicated objectives it might be possible to Q: Will I need ongoing advice?
area of financial planning and there transfer all of your other existing A: Some fund selections may need
are many things to consider before pensions into that one. to be reviewed from time to time to
12 13

8. Investment
What type of investor are you?
Building a solid investment strategy through good and bad times
During this period of economic Whatever your investment strategy the starting points Aggressive Investor
Achieving a
should be the same, and we can help you identify the
turbulence, what strategy type of approach best suited to your particular needs The aggressive investor wants to see real capital
and preferred balance between risk and return. growth in the short-to medium term of between
should investors take? Your 3 to 5 years and isn’t concerned about short-term
own attitude to risk is crucial. Take a look at some possible strategies for cautious, fluctuations. This investor will be prepared to take on
comfortable
moderate and aggressive investors. a wide range of stock market investments including
You may be comfortable to potentially volatile shares where there are high
Cautious Investor
live with capital risk if it means The cautious investor understands that they need to potential higher. The aggressive investor may offset
gains but also where the risk of losing
money is
the chance of a higher return achieve a return better than the rate of inflation to these high risk investments by diversifying into lower-
maintain their financial position and that in order to risk areas and may only be making those high risk
in the end. Alternatively, you
retirement.
beat the returns available on cash deposits they may investments with money they could afford to lose.
need to accept some stock market risk. However the
may be ‘risk averse’ and don’t cautious investor is uncomfortable about sharp falls
want to risk your capital under in value and wants to invest in stable investments To arrange a review of your
where the risk of this happening is limited. Keeping investment requirements,
any circumstances. ahead of inflation and getting a slightly better return
is more important than getting a high return only by
please contact us.
accepting a higher level of risk.
Do you need a professional assessment
The value of investments and the income from them
Moderate Investor can go down as well as up and you may not get back
The moderate investor wants to see their money grow your original investment. Past performance is not an
over the medium to long-term 5 years. As well as beating
inflation the moderate investor knows that capital
growth available from investing in the stock market
indication of future performance. Tax benefits may
vary as a result of statutory change and their value
will depend on individual circumstances. Thresholds,
of your situation to make this a reality?
gives them an opportunity of achieving this. Although percentage rates and tax legislation may change in
not happy about a significant short-term set-back the subsequent finance acts.
moderate investor is willing to accept the risk as they
are investing for the longer-term. However sustained
If you are unsure whether your pension is performing in
falls over a longer period might persuade the moderate
investor to move to less-risky investments.
line with your expectations, and that you’ve made the right
pension choices – don’t leave it to chance.
Contact us to discuss these and other important questions,
and we’ll help guide you to a comfortable retirement.
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9. Protection Protection
Financial protection
for you and your family
With the abundance of choice, we can help you make the right decisions
With so many different protection options available, making the right decision to protect your personal and
financial situation can seem overwhelming. There is a plethora of protection solutions which could help ensure
that a lump sum, or a replacement income, becomes available to you in the event that it is needed. We can make
sure that you are able to take the right decisions to deliver peace of mind for you and your family in the event of
death, if you are too ill to work or if you are diagnosed with a critical illness.
You can choose protection-only financially? You may not be able 12 to 24 months on a valid claim
insurance, which is called ‘term to work and so lose your income, if you have an accident, become
insurance’. In its simplest form, it but you are still alive so your life ill or unemployed. Most of these
pays out a specified amount if you assurance does not pay out. And to protection policies operate a
die within a selected period of years. compound the problem, you may ‘deferred period’, which is the
If you survive, it pays out nothing. It also require additional expensive period from when a claimable event
is one of the cheapest ways overall nursing care, have to adapt your happens to when the policy starts
of buying the cover you may need. home or even move to another more paying out.
Alternatively, a whole-of-life suitable property. Private medical insurance covers
policy provides cover for as long as Income Protection Insurance you for private medical treatment
you live. (IPI) formerly known as permanent and you can choose to add on
health insurance would make up extra cover, such as dental cover.
Life Assurance Options a percentage of your lost income You may select the hospitals
n Whole-of-life assurance plans caused by an illness, accident or where you would want to be
can be used to ensure that a disability. Rates vary according to treated close to home. As always,
guaranteed lump sum is paid the dangers associated with your the more benefits and the more
to your estate in the event of occupation, age, state of health comprehensive the policy you
your premature death. To avoid and gender but IPI is particularly select, the more it will cost.
inheritance tax and probate important if you are self employed Beyond taking the obvious step
delays, policies should be set up or if you do not have an employer of ensuring that you have adequate
Choosing the right mix
under an appropriate trust. that would continue to pay your insurance cover, you should also
n Level term plans provide a lump salary if you were unable to work. ensure that you have made a will. A of financial protection
sum for your beneficiaries in If you are diagnosed with living will makes clear your wishes for your particular
the event of your death over a suffering from one of a number of in the event that, for example, you situation is essential
specified term. specified ‘critical’ illnesses, a critical are pronounced clinically dead
n Family income benefit plans illness insurance policy would following an accident, and executes to ensure that your
give a replacement income pay out a tax-free lump sum if the an enduring power of attorney, so specific requirements
for beneficiaries on your event occurred during the term that if you become incapable of are fully covered. To
premature death. of your policy. Many life insurance managing your affairs as a result of
n Decreasing term protection plans companies offer policies that cover an accident or illness, you can be
discuss your options,
pay out a lump sum in the event you for both death and critical illness reassured that responsibility will please contact us.
of your death to cover a reducing and will pay out the guaranteed pass to someone you have chosen
liability for a fixed period, such as benefit on the first event to occur. and trust.
a repayment mortgage. Accident Sickness and Of course, all these protection NeeD MORe
Simply having life assurance may Unemployment (ASU) can be taken options also apply to your spouse INFORMATION?
not be sufficient. For instance, if out for any purpose to protect your and to those who are in civil
you contracted a near-fatal disease income and to give you peace of partnerships.
PLEASE CONTACT US
or illness, how would you cope mind. The benefits only pay for
WITH YOUR ENQUIRY.
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