December Market Commentary

Introduction

It is always difficult writing a report like this, as you are always trying to ‘hit a moving target.’ While you can record the stock market levels at the close of business on, say,  30th November, there is always the risk that the commentary is overtaken by events.

That has never been more true than this month: we wrote these notes on Monday 3rd December and, of course, you have to press ‘publish’ at some stage. However, we are very conscious that the situation regarding Brexit, and perhaps also the civil unrest in France, may have moved on by the time you read this.

Understanding pensions – what is drawdown?

Drawdown is a way of achieving greater flexibility with your pension funds. Every time you move your money into drawdown, you’re allowed to take 25% of this as a lump sum, which is exempt from tax. The rest continues as an investment, with taxable income able to be drawn straight from your pension whenever you choose. The tax-free lump sum must be taken at the start, but as you don’t have to move your whole pension at once, multiple lump sums can potentially be taken.

November Market Commentary

Introduction

October was, to put it mildly, an eventful month. It was a month which saw the majority of markets on which we report down steeply, as fears of higher interest rates in the US combined with worries about the US/China trade war. There was, however, one market that went up sharply: Brazil elected a new president,  a man who, I suspect, will feature prominently in future commentaries.

In the UK, the Prime Minister survived the latest round of calls for her head, and the Chancellor delivered his Budget a month earlier than everyone had expected.

Autumn 2018 Budget Overview

The Chancellor, Philip Hammond delivered his Autumn Budget to Parliament yesterday.

We have produced a summary, looking at the broad areas of the economy and the numbers, personal taxation, pensions and savings, business investment and business taxation, along with other measures. You can download our Autumn Budget Overview by clicking here

Talking about your will – don’t be one of the 93%

A national saving and investment survey has shown only 7% of people have spoken to their parents about inheritance. One of the most important parts of planning to leave an inheritance is to talk about it. This is obviously not an easy topic and it may be a good idea to set aside some specific family time to have this discussion. This could help avoid any family disputes before and after you are gone.

October Market Commentary

Introduction

On Tuesday, 3rd November 2020 the United States will go to the polls to elect its next President. All the indications are that Donald Trump will stand for a second term and if the words of Bill Clinton, “It’s the economy, stupid”, are to be believed, he will win.

While not wanting to make a political comment or endorse his policies in any way that be welcome to some extent, he does provide plenty of news and entertainment for these commentaries, after all. September was no exception, as he ramped up the trade war with China, ordering tariffs on a further $200bn (£154bn) of Chinese imports, which will include electronic products and consumer goods such as handbags.

6 top tips on how not to lose money from your pension each year

Keeping track of your pension can be difficult at the best of times, and if you have multiple pots it can seem nigh on impossible. Fortunately, we have some top tips to help.

First introduced in 2012, auto-enrolment makes it compulsory for UK employers to automatically enrol their staff into a pension scheme, unless you opt out.

Drawing your retirement income

Since Freedom and flexibility reforms were introduced by the government in April 2015, many more retirement savers choose not to purchase a lifetime annuity and instead use pension drawdown to access accumulated pension funds . This short video is a simple explanation of what drawdown is.

What does the nil rate band really mean for me?

Changes to inheritance tax (IHT) came in during 2017, affecting the allowance for those wanting to pass on their home to members of the family. But as the changes are being rolled out over the next few years up to the 2020/21 financial year, it can be hard to know if and how the changes will affect you.

The current amount you’re able to leave in your estate without incurring IHT is £325,000, known as the nil rate band (NRB). Anything above this amount incurs 40% tax, with certain exceptions, such as gifts to charities, being able to lower that percentage. Any transfers between spouses or civil partners are exempt from IHT even if your estate exceeds the NRB, with married or civil partnered couples having £650,000 – twice the NRB limit – to offset against their combined estate.

Changes to Inheritance Tax (IHT) – it’s complicated!

By 2020-21 couples could be free of IHT on up to £1m of their wealth which can be passed on to their children or grandchildren.

Currently, spouses and civil partners can pass all of their wealth to each other without tax. However, tax may be payable when it comes to cascading wealth down the generations. We can all pass on £325,000 which is the current Nil-Rate Band (NRB) before tax is due.  Nil-rate bands can also be passed between spouses.

The new regime makes it much more complicated, so much so that the Government website  has 18 examples of how the new Residence Nil-Rate Band (RNRB) can be used and calculated.