Latest News

David Winter (1947 – 2020)

It is with great sadness that we announce to the passing of David Winter on the 6^th of March 2020.

The current conditions imposed on social gatherings as a result of the Corona Virus means that, at present, we are unable to confirm a date for his funeral. We will keep you informed.

In terms of the current market turmoil, most of you would recall David’s mantra of “the markets will prevail”. He would have reminded us that this is a long term investment and that the market always has, and will, bounce back.

In terms of the business, it will continue to operate as it always. Harry and Gwyneth will continue to manage the business, as they have, since David’s retirement in 2017.

17/03/2020

Market Commentary – April 2020

At the beginning of the year we were fairly optimistic about the year ahead, China and America had come to some agreement over trade and China looked to be turning the corner in terms of economic recovery. Interest rates had been lowered in the US and remained on hold in Europe as well as the UK. These would all be a tail winds for the global economy and we expected equity markets to perform well this year.

3 Months later and The FTSE100 has dropped 30%, along with all other global markets, ending one of the longest bull markets in history. The cause of this was concerns over the Coronovirus epidemic and to what extent the global economy will be affected. This was further exacerbated by Russia refusing to cut their oil production output, keeping the oil price low. This has put pressure on petroleum producers who require higher prices to be profitable.

Over the last few weeks however, despite all the negative headlines, the market has rebounded strongly again illustrating that it’s extremely difficult to time the markets in these situations and the best strategy is to stay the course.

It is worth noting that, in light of the changes we made last year, our portfolios have been insulated to some degree against the downturn. Our portfolios have come been affected but our most aggressive portfolios, and therefore most volatile, are only down 4% of the last 12 months. In comparison to the FTSE100 which is down 22% over the same period.

The general consensus is that there will be a slow down in the economy but that once these quarantines are lifted the economy is expected to bounce back quickly and that there should be not long term effects.

Summary

It is still too early to determine how long the lockdowns will continue but equity markets are good value at the moment. There are still risks which could affect fund performance however and the FTSE100 has not been this low since 2011 and if you are prepared to accept the current volatility, investors will be handsomely rewarded over time.

16/04/2020

Coronavirus and Market Volatility

As you will be aware, global markets have come down following concerns over the Coronavirus. The general concern is how this virus could affect global growth as companies either close for a period or work with reduced staff. These concerns have been further exacerbated by a disagreement between Russia and the other oil producing countries over cutting oil production. This has resulted in the significant reduction in the price of oil, which could be considered a good thing for most consumers but not for companies that rely on a higher oil price to remain in business. At present it is uncertain as to what extent these concerns will affect global growth.

Globally, governments have reacted to these challenges by reducing interest rates which should support these businesses during this period. The Bank of England reduced interest rates by 0.5% this morning to support the economy.

The general feeling amongst fund managers is that we may have a few months of volatility ahead but, as things warm up and we head into summer, concerns over the spread of the virus will diminish and the market should return to normal. The majority of fund managers view this as good buying opportunity.

In terms of your investments, our portfolios have been holding a fair amount of cash for the last few years as well as fixed income funds and property. The fixed income funds we use are relatively cautious in their holdings and have low exposure to high yield bonds, which would be affected to a greater extent by the current market movements. Last year we introduced a Gold fund and we changed the focus of our portfolios to funds that produce an income or dividend yield, which would be better insulated against a market downturn. In light of your current holdings, we believe that your funds are well diversified and protected to a large extent against current market volatility.

In these times it is important to take a long-term view and that, very often when markets fall as sharply as they have, the rebound can be just as quick. It is therefore important to stay the course and avoid any attempts to time the markets.

12/03/2020

Ways To Save on Inheritance Tax

We spend most of our lives accumulating wealth which we would like to pass onto our heirs. The growth in the property over the last 10 – 15 years has meant that many of us are now perilously close to exceeding our Nil Rate band of £325,000. The effect of this is that our beneficiaries may not get what we intended once HMRC has taken their 40%.

The good news is that there are some things you can do to help reduce those charges, below are 5 of the most common ones.

Keep your tax free cash within your pension.

When it comes to taking your benefits from a money purchase pension at retirement, the usual course of action is to take the full Tax Free Cash and invest this elsewhere or put this into your Current Account and either buy an annuity with the remaining funds or take a Drawdown pension. Since pensions are exempt from Inheritance Tax it would make sense to keep as much of your Tax Free Lump Sum within the pension. Some pension pensions allow you to rather take your lump sum “as and when” needed rather than needing to take the full lump sum when you take your benefits.

Leave your house to your children in your Will.

The current Nil Rate Band (the amount under which you do not pay inheritance tax) is £325,000, however if you leave you house to a direct descendent, rather than to a trust, you would have an additional £150,000 allowance, giving you a Nil Rate Band of £475,000. This will increase to £500,000 in 2020. This means a married couple could have a Nil Rate band of £1m in 2020.

Gifts

Each year you are allowed to gift £3000 without any IHT implications. You can also backdate this by one year which means you can gift £6,000 if you have not done this in the previous year. You are also allowed to give a gift of £5,000 as a wedding gift to one of your children.

Most people are aware of the £3,000 gifting allowance but most are not aware of the gifts of income which will also not be included in your estate for IHT. This means you can give away your excess income. For example you could pay university fees for children or grandchildren without this affecting your IHT planning.

Assets gifted to charity in your Willed to charities will reduce your IHT charges.

Trusts.

You can gift various investments and property into trust. This would allow the growth of the assets to grow outside of your estate. One needs to bear in mind that over a 7 year period from the date of the gift that a portion or even the full value of the gift could still fall within your estate for IHT.

IHT exempt investments.

The problem with leaving investments into trust is that you have limited scope to access those funds if needed. Another option for those who would prefer not to wait for 7 years and would still like to access to their funds if needed, would be to invest into an investment which qualifies for business property relief. Investments into qualifying investments will mean that your investment falls out of your estate for IHT within 2 years but will allow you access to your funds if needed.

These are probably the most common way of reducing IHT costs but there are many other solutions out there. The points above should not be construed as advice but rather an indication of what options are available. It is important that you take advice before deciding on which solutions would suit you best.

31/05/2019

Brexit Progress:

There has been significant progress in the Brexit negotiations in the last 48 hours. A withdrawal deal has been agreed between the UK and European Union (EU). The prime minister (PM), Theresa May, has presented this to her cabinet. Whilst the PM appeared to have the backing of her cabinet last night, Dominic Raab, the Secretary of State for Exiting the EU has just resigned which will create concerns about a leadership challenge and the deal when it reaches Parliament. We continue to believe that no UK politician can secure a better deal simply because there is no other solution to the Irish Border. Despite posturing, we expect the PM to conclude the negotiation and the deal to pass through Parliament by the end of the year.

What is “the deal”?
The deal constitutes three parts: the divorce bill, a period of transition to December 2020 (or possibly beyond) in which nothing changes so firms have time to adapt, and the broadest heads of terms on the future long-term economic relationship between the UK and the EU.

The sticking point throughout has been how to manage the UK’s ambition of having no border on the island of Ireland nor a border in the Irish Sea, but at the same time separating itself from the European single market and customs union to enable it to set its own rules and trade agreements.

The simple fact is that there is no solution to the Irish border question, except that Great Britain and Northern Ireland stay in the customs agreement for goods. That is the stated ambition for the final relationship. Given the priority in the UK parliament of maintaining the union between Great Britain and Northern Ireland and to respect the Irish peace process, we have always expected the deal to land in this way (see On the Minds of Investors – How will the Brexit negotiations conclude? ¹).

The ambition – and compromise to certain members of the Conservative Party – will be that the UK pursues a technological solution that, at some point in the future, allows for an invisible Irish border and opens up some options for the UK in establishing other trade relationships. There is also enough in the wording to suggest that UK financial services will be able to continue trading in the EU in much the same way today under an equivalence framework. Importantly, these rights cannot be removed in an abrupt or arbitrary manner.

There is a ‘backstop solution’ which would come in to force at the end of the transition period in December 2020 if a broad trade deal encompassing the customs union cannot be achieved. This does see some special arrangements for Northern Ireland. The prime minister will need to reassure the Democratic Unionist Party (DUP) that this is such an extremely remote possibility in order to have their backing.

What’s next?

The PM has presented the deal to her cabinet. Whilst she appeared to have the backing of her cabinet last night, Dominic Raab, the Secretary of State for Exiting the EU has just resigned which will create concerns about a leadership challenge and the deal when it reaches parliament. We continue to believe that no UK politician can secure a better deal simply because there is no other solution to the Irish Border. We believe the PM will win any leadership contest. There is then likely to be another round of meetings in Brussels to sign off on 25 November and then the bill needs to be put to the UK parliament. This is the bit investors have been most nervous about.

The specifics are that the government will lay a statement in the Houses of Parliament saying that a deal has been reached and then will submit a motion to the House of Commons and schedule a time for a debate and vote. This could be as little as five days after laying the statement.

It may not be voted through first time. It may take a number of amendments to appease backbenchers (such as specifics on the ambition for a technological Irish border solution and how that could alter the deal in the future). So there may still be back and forth as footnotes and finer details are added to appease all sides. This process may still generate considerable market volatility. But it is important to remember that even if members of the Conservative Party do not ‘like’ the deal, voting against the prime minister raises the risk of political deadlock that can only be resolved through either another Brexit referendum (with the options this deal or stay in EU), or a general election. That would be a significant risk for backbenchers to take. We think the bill will pass and most likely in the first week of December.

All 27 remaining EU member states also need to pass legislation (hence the need to get the deal wrapped up well ahead of 29 March) but we see limited reason for concern about that ratification process.

The UK formally leaves the EU on 29 March but during the period of transition (running up to December 2020 or beyond) nothing changes. The transition period was designed to allow businesses time to adapt to the new relationship. Negotiators will continue to work during the period of transition on the full aspects of the final partnership with the ambition of having all the details filled in six months ahead of the transition period ending.

What impact will it have on markets?
Whilst political headlines are likely to generate a lot of volatility in the coming days on passage of the bill, sterling is likely to rally. This may adversely affect the FTSE 100 given the high proportion of FTSE earnings that are repatriated. Going in to next year we expect business investment to experience a relief rally and higher sterling to depress inflation and lift real wages so consumer spending would also accelerate. Given the Bank of England (BoE) believes that the economy is already at capacity, we think it will raise interest rates at a faster pace than the market currently expects (we see at least two 25 basis point increases next year). When the BoE confirms this more hawkish playbook, we expect sterling to rally further.

For more information, please contact your J.P. Morgan Asset Management representative.

¹On the Minds of Investors – How will the Brexit negotiations conclude?, Karen Ward, J.P. Morgan Asset Management, October 2018.

15.11.2018

Autumn Budget:

The budget can be seen as one that didn’t want to rock the boat in terms of making too many changes and I saw it as broadly supportive of the economy. There were some incentives to encourage business to invest the funds that they have been holding in preparation for Brexit.

The outlook for the economy is positive compared to recession predictions after the Brexit vote, obviously this would be based on us receiving a Brexit deal, this outlook may change if we were to leave without a deal.

The changes to personal tax rates would be welcome to individual tax payers with the personal allowance increasing to £12,500 and an increase to basic rate tax payers up to £50,000. The Capital Gains Tax allowance will also increase to £12,000.

In terms of IHT, the nil rate band remains £325,000 but the main residence allowance will be increased to £150,000, meaning married couples who leave their primary residence to their children could have an allowance of £950,000.

The lifetime allowance for pensions has also been increased in line with CPI up to £1,055,000.

30.10.2018

The infographic below illustrates what’s happening with regards to the trade wars, inflation and emerging markets. Click on the image to view a larger version.

18.07.2018

Old Mutual name change to Quilter.

If you are an Old Mutual investor you may have already received or will receive a letter confirming that Old Mutual is in the process of changing its name to Quilter.(Click here for a copy of the letter)

What does this mean for you as an investor?

If you are an investor with Old Mutual, nothing will change. You will still be invested in our various portfolios and there is no requirement to do anything from your side.

Are my investments/pensions still safe?

Quilter will still be the 3^rd largest, provider lead, platform in the UK and is registered with the FCA which means all the protections provided by FSCS and the Pensions Regulator, that you enjoyed while being under Old Mutual, will remain in place.

We believe that this change should be fairly seamless and therefore don’t anticipate any problems.

If you have any further queries please feel free to contact us.

03.07.2018

A great infographic form Schroders highlighting what to expect and things to watch out for this year.

01.03.2018

Economic Commentary.

The US business cycle expansion is continuing, as reflected in rising employment, moderate real GDP growth, and rising equity and real estate prices. With inflation below target there are good prospects of this expansion achieving a record length.

The main risk to this scenario is that the US Federal Reserve (Fed) tightens credit too sharply, not so much by raising interest rates, but by curtailing credit growth in the private sector. Already private sector credit growth is as low as 3-4% p.a. When the Fed starts shrinking its balance sheet by as much as US$50 billion per month in late 2018, private credit markets could face a challenge in absorbing this volume of Treasury and agency securities.

In the Eurozone economic activity is at last expanding at a momentum close to the economy’s potential. This is largely a result of the asset purchase programme started by the European Central Bank (ECB) in March 2015 and the associated acceleration of M3. To ensure momentum is sustained, commercial banks need to create credit more rapidly than at present, otherwise when the ECB starts to taper its purchases, credit growth could weaken substantially.

Inflation in the single currency area remains below target, reflecting the slow growth of nominal aggregate demand. Following the recent strength of the euro it seems likely that inflation will remain below target for much of 2018.

With the German election completed and Angela Merkel now working to create a new coalition between her Christian Democratic Union (CDU) party, the Free Democratic Party (FDP) and the Greens, the next big event on the European calendar is the Italian election next year.

In Britain the growth of the economy has slowed as a consequence of the weaker pound raising inflation and eroding real wages. In addition, there has been some slowdown of investment and capital inflows, but export order books are buoyant.

In addition to imported inflation there is a danger that accelerating money and credit expansion in the UK could add locally generated inflation to the imported inflation. For this reason the Bank of England (BoE) chose to raise interest rates in November. Beyond that, growth is likely to settle at around 1.5% until the uncertainties of the Brexit negotiations are overcome.

The Japanese economy has seen slightly better growth in 2017 but inflation remains well below 2%, despite the implementation of a massive quantitative easing (QE) programme from the Bank of Japan (BoJ) ever since March 2013. – Invesco

Summary

The UK continues to perform well with economic growth surprising to the up side and unemployment remaining low. We are seeing signs however that inflation has now started to take effect which will have a moderating effect on the economy.

We are generally upbeat about equities, however, we feel that there are sum uncertainties specifically with regards to the UK and Brexit, as a result we have reduced out exposure to the UK and increased our equity exposure to Europe, Emerging Markets and Japan.

We see the increase in interest rates and the tapering of bond purchasing by the Bank Of England as being negative for fixed interest and commercial property, we have therefore adopted a more cautious approach toward this sector.

10.01.2018

This infographic is a great summary of what is happening at the moment in the global economy.

17.11.2017

Yesterday the Bank of England decided to increase interest rates by 0.25%. This was largely expected and does show that they are confident about the current state of the economy. There will mostly be a further 2 in the coming year.

03.11..2017

We are constantly reviewing our portfolios to ensure that our client’s holding remain relevant to what is happening in the global economy, as a result we have recently made some changes to our portfolios. The info-graphic below nicely explains the reasoning behind those changes.

19.10.2017

This mirrors how we see Europe from an investment point of view.

09.08.2017

A great summary of what has happened so far this year and what to expect going forward.

09.08.2017

How would and increase in interest rates affect your investment holdings?

An increase in interest rates would generally strengthen Sterling. The reason for this is that investors start investing money into the UK as they could get better interest rates than where they are currently invested. This creates demand which consequently increases the value of Sterling.

Equities:

A stronger pound, for those companies earning the majority of their income from exports, would make them less competitive as it would become more expensive for overseas consumers to buy their products. Another factor to bear in mind is that many of the companies that make up the FTSE 100 are duel listed meaning that they are listed on more than one securities exchange. If Sterling strengthens then the price of the duel listed company goes down in sterling to match the price of the share on let’s say the New York securities exchange. We saw the opposite of this last year where Sterling fell and the FTSE 100 kept going up.

Should interest rates go up we could see the FTSE 100 underperform.

Fixed interest:

Fixed interest consists of bonds and Gilts. Quantative Easing, which basically had governments buying their own bonds/gilts to support their economies, means bond/gilt prices are very high. Quantative easing in the US has come to an end and based on economic data in the UK has probably also come to an end here. The effect of an interest rate increase in this market means that investors may start to invest into cash instead of bonds and gilts. If governments are no longer purchasing their own bonds/gilts, there is less demand for those instruments and prices could fall.

Property:

Over the last few years investors have been buying property as the yields on fixed income has been very low. Should interest rates increase then investors could move out of property and into fixed interest or cash. This would be negative for property.

Inflation:

The UK is a net importer of goods, meaning we buy more goods than what we sell. The stronger pound means goods become cheaper and the inflation starts to decrease.

Asset allocation changes:

In light of the above and the uncertainty around Brexit we are adjusting our portfolios by reducing our allocation to the UK equities, property and Fixed Interest. Consequently we are increasing our allocations to cash and global equities.

07.07.2017

UK General Elections

French Elections

Markets have reacted positively to Emmanuel Macron and Marine Le Pen going forward to the second round of the French presidential election on 7 May. Polls on the second round now show establishment figure, Macron, ahead of Le Pen by more than 10 percentage points. There’s an overwhelming likelihood of Macron being the next French president, notwithstanding another ‘surprise’ election outcome.

An ultimate Macron victory would remove the downside tail risks associated with ‘Frexit’, be supportive of the cyclical upturn in Europe and provide upside potential from his structural reform agenda. This direction of travel is good news for European equities and removes some of the political risk that kept investors on the sidelines. It will be easier for them to now refocus on the fundamentals.

26.04.2017

Snap Election.

Theresa May has called for a snap election which has been recieved well in the markets and has resulted in a stronger GBP. An election now would give more direction for the UK which is what investors want to see. I have attached an info-graphic on how the election could affect your investments.

https://www.uploadlibrary.com/Architasmm/Election_infographic_19apr2017.pdf

22.04.2017

Inflation

Inflation has crept up to 2.3% and it is forecast to rise as high as 3%.

What does this mean for investors?

Inflation affects the amount of goods and services we are able to buy with our money. Inflation has been low for several years but we will soon start noticing that what used to cost us £100 at the till will start costing more. If you are still working, your income should increase over time to make up for these increases, however if you are relying on your savings to live on then your investments must keep pace with inflation in order to ensure that your funds hold their real value over time.

In order to illustrate this I’ve put together a chart which assumes that you have invested £50,000 into a bank account or cash ISA and the interest on your deposit is 0.5%pa. If you invested the money for 5 years it would grow to £51,008 (light blue) however after inflation of 3% you would still be losing money. The £51,008 would actually be worth £45,184 (dark blue) in terms of what you are able to buy with it.

As you can see from the above example, if your investments are not keeping pace with inflation it may be time to assess your investment strategy.

23.03.2017

Budget speech.

The budget speech was fairly uneventful in light of the ongoing negotiations with regards to the UK leaving the EU. The economy performed better than expected since the Brexit referendum and this allowed Philip Hammond to revise expected borrowing and increase economic growth expectations.

Some of the key points are follows:

Growth forecast for the economy has gone up from 1.4% to 2%
Extra £2 billion for social care in England over the next three years
Higher paid self-employed to pay an average of 60p a week more in NI (Philip Hammond retracted a week later)
Most pubs are to be given a £1,000 discount on business rates

14.03.2017

Market update:

Last week Donald Trump was inaugurated as the New President of the USA. The markets seemed to take this into their stride although comments by Donald Trump that the Dollar is too strong may pour water on the idea of 2 or 3 interest rate increases this year in the US. I am sure we’ll see at least one or even possibly 2 increases this year though.

There is also a chance of interest rate increases in the UK as the economy seems to be far stronger than what the Bank of England initially anticipated after the EU referendum. This would also help counteract inflation which is currently running at 1.6%. Increases in interest rates can have a negative effect on the value of bonds, most specifically gilts so we are evaluating our portfolios with this in mind.

Looking into 2017, there are a number of Elections within the EU, most notably France, Germany and the Netherlands. This means we could be in for another volatile year for equities but one which might see investors moving into equities rather than holding bonds which could drive equities higher.

We have always advocated holding a balanced portfolio which is diversified geographically and in terms of asset classes, however if you are holding bonds or gilts as an alternative to cash and are concerned about the risk please contact us for a portfolio evaluation.

23.01.17

US Interest Rates:

Last week the US raised their interest rates by 0.25% with another 3 possibly coming in 2017. This can be seen as a vote of confidence in the US economy although there is still a fair amount of uncertainty over Trumps economic policies. The result is that bond markets have come under pressure as more investors favour of holding cash rather than bonds. On the plus side equities have done well with FTSE 100 and S&P 500 being up 10% and 15% respectively over the last 12 months.

Considering what happened this year politically I think most people would be happy with that, hopefully next year isn’t as volatile.

12.12.16

Autumn Budget speech:

The budget speech was fairly uneventful in light of the uncertainty over Brexit. The UK economy has surprised many with its resilience and has been the best performing economy in Europe, Philip Hammond has however reduced expected economic growth rates down to 1.4% next year.

I have listed some key points below but if you want a more in depth breakdown click on the link at the bottom.

Reduction in corporation tax rate confirmed
New £23bn National Productivity Investment Fund
Personal allowance to increase as planned
National Living Wage and National Minimum Wage to rise
Increase in insurance premium tax
Fuel duty frozen again
Autumn Statement to be abolished and budget moved from Spring to Autumn

https://www.theguardian.com/uk-news/2016/nov/23/key-points-autumn-statement-at-a-glance

25.11.16 Trump and what it means for us.

It’s been an interesting few weeks since the election of Trump as the 45^th president of the United States. Initially the surprise result saw markets come off a few percentage points but they recovered quickly and the FTSE 100 ended up on the day.

The Dollar has since weakened against the Pound as the interest rate increase in the US that everyone was expecting, now seems less likely.

There not too much information Trumps economic plans but it would seem that he will lower taxes for US companies and invest significantly in infrastructure. This will be good for the economy but the borrowing may weaken the Dollar against other currencies which could cause inflation in the US.

From a UK point of view, Trump seems to be very much in favour of Brexit and we can probably expect trade relation to strengthen with the US, he was not in favour of TPP which seems to be dead and buried.

Locally the good news continues for now as retail trade was higher than expected in October.

It’s a few days before the Autumn statement which will be interesting to see what plans Mr. Hammond has for us.

21.11.16 The Economy.

The markets have picked up nicely since the beginning of the year and the FTSE 100 has jumped up 8% in the last 3 months. There is still however an amount of uncertainty which is leading to a lot of volatility. There are signs of a recovery in emerging markets which seems to have stemmed from the increase in commodity prices. China looks to be heading for a soft landing and there are some positive signs there.

It looks like the BOE will keep interest rates on hold as there is a fair amount of uncertainty with the Brexit poll on the horizon.

23.09.16

Rates cut.

As expected the Bank of England cut interest rates to 0.25% as a result of the slowing economy. They have combined this with a round of quantitative easing which helps support businesses in terms giving them greater liquidity and lowering borrowing costs. It also means that consumers who have variable rate mortgages will pay less every month.

The flip side is that if you have cash sitting in the bank, now might be a good time to look at other options as you will not be getting much interest on your funds.

05.08.16

Property Funds

Due to the uncertainty surrounding Brexit most commercial property funds have made the decision to temporarily stop trading. Many investor were attempting to liquidate their holdings on concerns that financial services companies in London would have to move to Europe as a result of the referendum. There seems to be more clarity on this and this may no longer be the case. A recent decision by the EU to allow financial services firms to trade in the EU without having a physical presence means that UK based financial services companies will continue to have access to the EU without having to move there. Read about it here.

The current hold on trading means that the funds will not be forced to sell properties at a discount to maintain liquidity which would be detrimental to all investors.

We are not concerned by this closure as the fundamentals are very different to the 2008-2009 correction. We will still hold property going forward and believe it is an essential part of a diversified portfolio. Some funds have started trading again so we don’t see this being a long term situation.

20.07.16

Brexit

Today the UK made the historic decision to leave the EU. We don’t know what this will mean for the long term but for the moment things remain the same. We believe our portfolios are well positioned and we don’t feel the need to make any changes at the moment.

If however you feel you would like to talk to us please feel free to give us a call.

24.06.16

The markets have picked up nicely since the beginning of the year and the FTSE 100 has jumped up 8% in the last 3 months. There is still however an amount of uncertainty which is leading to a lot of volatility. There are signs of a recovery in emerging markets which seems to have stemmed from the increase in commodity prices. China looks to be heading for a soft landing and there are some positive signs there.

It looks like the BOE will keep interest rates on hold as there is a fair amount of uncertainty with the Brexit poll on the horizon.

11.05.16

UK GDP was up to 0.7% for Q2 of 2015 from 0.4% in Q1, and although the economy is in good shape there are still very few signs of an interest rate rise in the near future. Problems in China and the Eurozone have pulled global stockmarkets back, with many experts having predicted a market correction. The long term outlook for developed economies is still looking very good and we do not see any reason to alter our strategic approach to asset allocation at this time..

People are taking longer between house moves as property prices grew by almost 10% over the last year. Recent data shows the average time has almost doubled from 10 years in the 1980s to 21 years now.

The FTSE has remained fairly stable following the general election and we are yet to see the retraction that many are were predicting. Whilst we remain cautious in the short term the long term indicators are looking positive.

01.06.15

Global stock markets have continued to brush off fears expressed recently about higher US interest rates and the troubled Greek bailout. By late April the S&P 500 was poised to regain its February all tiem highs and the FTSE-100 was firmly in record territory.

UK inflation stayed at 0% in March for the second month running, according to the ONS. This represents good news for consumers but worrying news for economists. Many of the projections we are now seeing show a small dip in to deflation for the summer months.

29.04.15

This years budget was far less dramatic than last year, which is not a bad thing! The most notable change for our clients is the reduction in the Lifetime Allowance for pension savings from £1.25million to £1million. This will not take affect until 6th April 2016 and from 2018 the allowance limit will be increased in line with inflation. if you have any questions in relation to the budget please do not hesitate to contact the office.

19.03.15

We are now approaching the end of the 2014/15 tax year, which presents a good opportunity to make full use of your ISA allowances. The ISA limit was raised to £15,000 last year which offers savers the potential to benefit more from tax efficient saving than ever before. The new ISA limit from 6th April 2015 will be £15,240 per inidividual.

02.03.15

Thanks to all our clients who attended our 25 year celebration last week. The evening went well and it was great to see so many of you, thank you for your continued support!

26.01.15

Happy New Year!

There continues to be volatility and nervousness surrounding the financial markets and we have seen this first hand with the FTSE 100. The oil price slump is arguably the largest contributing factor at present along with the issues in Europe and most notably Greece.

With low inflation it seems unrealistic to expect interest rates to rise from the all time low any time soon whilst we are also expecting a slowdown in property prices, especially in London where the new stamp duty rates should cool price growth.

05.01.15

Investors are on the hunt for bargains in Europe despite the threat of deflation. There is a renewed interest in Europe despite a raft of disappointing data and a sell off in European markets. Stocks have partally bounced back recently and some wealth managers believe the pessimism in the region is overblown. Fears over the recent slump in Germany’s industrial output seem excessivre and if deflation can be avoided Europe as a whole could represent an investment opportunity.

20.11.14

Over 55’s are borrowing and spending more than ever before, meaning they are saving less according to research from Aviva. The average amount owed was £2,269 via credit cards, personal loans and overdrafts. Property remains the largest asset for the over 55’s with a house on average costing £253,322. The results tie in with a more optimistic outlook as the confidence returns to the UK economy.

15.10.14

London has become the millionaire capital of the world with almost 3 per cent of the population commanding more that $1million in net assets. Millionaire numbers worldwide have grown by 58% during the past 10 years, while multi-millionaire numbers have gone up by 71%. In London alone the average house price has reached £560,386 for this month, compared with £270,636 for the rest of the country. This data is announced as house sales have hit their highest point in 7 years!

14.08.14

Unceartainty over when we will see a hike in interest rates is having an impact on equity prices – notably some of the consumer cycles. Bank of England governor Mark Carney’s comments that interest rates may be raised sooner than expected were just a shot across the bows of the market to remind it that rates are at historic lows and will not stay there forever. It is widely predicted that interest rates will begin to gradually rise by the end 2014.

Elsewhere, to prevent abuse of the ‘new regime’ the Government are cutting the Annual Allowance for Pensions to £10,000 for retirees. The new limit will apply if the individual has accessed a Defined Contribution pension fund in excess of £10,000 after April 2015.

22.07.14

Britain’s economic growth looked more cheerful as the British Chambers of Commerce (BCC) raised its forecast for 2014 to 3.1% from its earlier prediction of 2.8%. Meanwhile the CBI said its May survey of 700 manufacturers, retailers and service sector firms showed the economy growing at its fastest pace since records began in 2003. The BCC has however warned that households are under stain, and that it expected growth to slow to 2.7% in 2015, and a further 2.5% in 2016.

24.06.2014

As it is now fast approaching we would like to remind our clients that from the 1st July savers will be able to invest up to £15,000 in to New ISAs (NISA). Global developed markets have now generally recovered to pre-crisis levels, and we are starting to see more confidence in the economy following the recent positive economic data. If you would like to find out more or are considering placing an ISA investment please do not hesitate to contact us.

28.05.2014

With some major changes announced in The Budget recently we thought we would summarise some of the key points for our investors. For pensions your new Annual Allowance is £40,000 for the 2014/15 tax year and your Liftetime Allowance is £1.25million. These allowances cap the level of tax tax efficient pension savings and individual can carry out. The minimum income requirement for Flexible Drawdown is now £12,000pa, reduced down from £20,000pa. The Trivial Commutation lump sum has increased from £18,000 to £30,000 as of 27th March 2014 – this increases the flexibility on offer from smaller pension pots. The maximum income you can take from Capped Drawdown arrangements will be raised to 150% of GAD, again from 27th March 2014. There are also proposed changes in the pipeline for 2015/16 which would allow individuals to take their pension pots as a lump sum regardless of fund size, from age 55 – effectively removing compulsory Annuity purchase. (Remember that 75% of the pot would still be taxed at your marginal rate of tax!) Overall the pension changes have been implemented to encourage flexiblity in how we take our retirement benefits.

From 1st July 2014 savers will be able to invest up to £15,000 each year in to an ISA, which is a large increase on the existing allowance. You can invest any amount up to the £15,000 limit in either Cash or Stocks & Shares. The annual limit for Junior ISAs has also increased to £4,000. If you would like further information on the changes following this years Budget please contact us on 01329 280661.

03.04.2014

With the end of the tax year now fast approaching you need to act quickly if you want to make use of the various allowances available to you. Your Pension Annual Allowance for 2013/14 is £50,000 (reducing to £40,000 in the new tax year) and this years Stocks & Shares ISA allowance is £11,520.

If you would like to make use of your allowances before the 2013/14 tax year ends then please contact us as soon as possible.

10.03.2014

Markets have endured a fairly turbulent start to 2014 which has not been helped by the uncertainty surrounding Emerging Markets. The withdrawal of Quantitative Easing in the US will have a negative effect on the emerging economies, with funds returning to the US where economic prospects are looking better. However as a long term investment the Emerging Markets sector still looks attractive with volatility a given along the way.

China is experiencing a slowdown in its economy but with GDP of around 7% the potential is still greater than much of the developed world!

10.02.2014

Any employers who know that they are approaching their staging date for Auto Enrolment should be aware that most insurance companies require you to be at lease 3-6 months away from your staging date to begin the process of establishing a scheme. Those that are within this time frame may end up being turned away from various providers. The main reason for this seems to be due to capacity issues in that providers are struggling to meet demand.

27.01.2014

Happy New Year to all, here’s to a productive and prosperous 2014!

03.01.2014

Reported in Money Marketing December 2013

The Treasury select sub-committee says the Money Advice Service is “not fit for purpose” and in need of a “radical overhaul”, as it publishes its damning inquiry into the future of the service. MPs say they considered recommending MAS be scrapped completely, but have granted it a “stay of execution” until the findings of a Government review into the MAS’ objectives are published.

The Treasury is set to carry out a review of the MAS between 2013 and 2015. But the sub-committee is calling for the review to be brought forward “as a matter of urgency” and be conducted by an independent body rather than the Treasury over concerns it may have already decided the service should continue in its current form.

09.12.2013

Global equities have continued to do well recently on the understanding the Quantitative Easing stimulus will not be withdrawn in the near future. Whilst this has been a strong period for equities we are still approaching the markets with cautioun due to the potential effects a withdrawal of QE could have. It has been reported that interest rates will not rise until unemployiment hits 7% and even then it is not certain that this will trigger a shift upwards. Many market analysts believe that interest rates will begin to rise during 2015, however, it is still feasible to believe that we could be waiting until 2016 and beyond to see any changes.

25.11.2013

The UK housing market recovery remains firmly on track. The fall in September has been described as a function of an unusually strong August and mortgage sales figures have supported this theory. The Council for Mortgage Lending (CML) explained that year-on-year mortgage lending in September was 41% higher than last year. The London housing market continues to lead the way with house prices rising again.

Many are attributing the improving conditions to the Government Help to Buy scheme, however, the real effects of this are not expected to be seen until January 2014.

29.10.2013

The minimum wage has increased by 12p to £6.31 an hour and by 5p for 18-20 year olds to £5.03 an hour. The Government has stated that it plans to tackle those who are not complying with the law and fail to adhere to these minimum reuqirements. The Retail Prices Index (RPI) currently sits at 3.2% and the Consumer Prices Index (CPI) at 2.8%

On a separate note; a big thank you to all those who attended our Macmillan coffee morning on Friday 27th September and helped raise some money for a great cause.

02.10.2013

Global markets have risen on the back of the announcement that the Federal Reserve will maintain its Quantitative Easing (QE) programme. It was widely expected that they would begin to taper their QE programme, however there are clear concerns that the US economy is not strong enough for the bond buying stimulus to be withdrawn.

The news has caused the US Dollar to fall and has resulted in the price of Gold rising sharply. Global markets have generally enjoyed positive reactions off of the back of this and the FTSE is currently up 1.4% and trading at 6,652. Whilst the news is positive for markets in the short term we may see some increased volatility once the dust has settled.

19.09.2013

We are hosting a Macmillan coffee morning on Friday 27th September from 10:00-12:00 at our office in Fareham. Please feel free to come along and have a coffee with us as we try and raise a bit of money for a great cause.

13.09.2013

Reported in Money Marketing August 2013

Business activity in the service sector has hit its highest level in 6 years, adding further weight to the UK’s economic rebound according to figures from the Confederation of Brtish Industry.

The Office for National Statistics has increased its estimate for the UK’s economic growth in the second quarter. Official figures show GP as expanding by 0.7% up from the preliminary estimate of 0.6%.

03.09.2013

If you are currently considering reviewing your life cover you may want to consider a Relevant Life policy. A Relevant Life plan can be a very tax efficient way of arranging your protection and can also be used for company directors and their employees. Although not suitable for everyone it is something you should consider before signing up to any new policies. If you like us to run a quote for Relevant Life to see if it could be of benefit to you then please give us a call.

21.08.2013

Automatic Enrolment is the latest large piece of pension reform which has been desigend to try and make sure that all elgible employees automatically become members of a qualifying pension scheme. The responsibility for making sure this happens lies with the employer and your staging date could be sooner than you think. The largest companies across the country have already started using Auto Enrolment and the obligations for smaller buisnesses are next.

At david winter we can help you to find our what your obligations are, the level of contributions you will be required to pay or when your staging date is, along with the answers to many other questions. If you would like to book a consultation with either David or Sam to discuss Auto Enrolment, please contact the office using the details on our website.

07.08.2013

As of June this year we have had a new adviser join david winter and are pleased to welcome Sam O’Mara to our team.

Sam has worked locally in the industry for 7 years and is a fully qualified Independent Financial Adviser also holding an Honors Degree in Business Economics. He is now within touching distance of becoming a Chartered Financial Planner and already holds the Chartered qualifications for Pensions, Tax and Trusts.

Outside of work Sam enjoys all sports, primarily playing football and golf – although there is some way to go before he can call himself a golfer!

01.08.2013

Recent statistics have shown that Economic Growth in the UK doubled to 0.6% in Q2, showing signs of an improving outlook for our economy. The Consumer Prices Index (CPI) is currently at 2.9% which is 0.9% greater than the Government target of 2% and the highest it has been since April last year. Inflation hasn’t been at its target level for

a few years now, however the overall trend has still been moving in the right direction. We are certainly a long way off the highs of the 70s and 80s!!

29.07.2013

UK Economic Growth is predicted to be improving after news of rises in house prices and the level of business investment. Perhaps the largest contributing factor to the positive outlook from many economists is the rising level of consumer spending. The economy grew by 0.3% in Q1 this year and is expected to improve on this when the results of Q2 are announced.

22.07.2013

From 26th March this year the Government Actuary Department rate (GAD) was raised from 100% to 120%.

The change means that the maximum level of income you can take from your drawdown pension fund will increase. The move was enforced by Chancellor George Osborne after pension pots were being hit by falling gilt yields and increasing life expectancy. When considering your retirement income needs it is important to consider the sustainability of the chosen level of income and the investment growth desired to maintain it.

01.07.2013

Current Bank of England Governor Lord Mervyn King has again confirmed his stance on the need for interest rates to remain low. King’s statement that any intent to raise interest rates would be ‘premature’ is a result of speculation following news from the Federal Reserve that they will now begin to unwind the Quantitative Easing strategy. Lord Mervyn King will be leaving his post on 1st July.

25.06.2013

Markets are generally having a good run and the FTSE 100 index is moving towards the 7000 barrier. However, some commentators are predicting a ‘correction’ in the near future.

The UK’s inflation rate has edged down from 2.8% to 2.4% which is closer to the Government’s target, giving new Bank of England Governor, Mark Carney, more scope with interest rates

The Financial Conduct Authority has now replaced The Financial Services Authority – this took place on 1st April. The FCA will police firms’ conduct, hence the name, to ensure consumers are protected. Unlike the previous system where the FSA oversaw the entire financial services industry, the responsibility to ensure banks are financially stable will reside with the new Prudential Regulation Authority.