So people entering the workforce today face a âmonumental savings challengeâ, the International Longevity. Centre-UK
HUNTER & CO.
Client Newsletter Quarter 3, 2017 | Issue 7
It’s been a busy few months at the Wealth Design Group since our last newsletter update. With that in mind, we want to begin by sharing with you some of our recent developments.
Award Winning
Charity Golf Event
Over the summer we have seen a number of successes: Not only did we win the Express & Star Award for Micro Business of the Year, but we were also named Runners Up for Young Business of the Year.
Our Charity Golf Event took place on Wednesday 12th July at Aston Wood Golf Club and was a huge success.
The event took place at Wolverhampton Racecourse - was attended by around 400 people, representing businesses small and large from across the Black Country and South Staffordshire. The evening was a testament to the region’s thriving business community.
The event organised by Roger Partridge hosted a number of stars, including Tony Hadley formerly of Spandau Ballet and Ocean Colour Scene’s Andy Bennett. Wealth Design Director David Philips said, “The Charity Golf Event was a tremendous day and a wonderful opportunity for us to support a local event. We’re hoping to have the opportunity to sponsor this special occasion in the future”. The event raised £14,000 for charity.
Wealth Design came runner up for Most Promising New Start-Up at the 2017 Staffordshire Business Awards. The evening took place at the Staffordshire County Showground on Thursday 6th July. Steve Bennett (Wealth Design), Gordon Cowans (Ex-Aston Villa), Roger Partridge (Organiser) Tony Christie (Singer), Ollie Spencer (Comedian) David Philips (Wealth Design) Scott Flemings (Wealth Design Group) Geoff Turton (Rockin’ Berries) and Tony Hadley (Former Spandau Ballet)
Financial Overview Guardianship of the Property and Affairs of Missing Persons The Guardianship (Missing Persons) Act 2017 has now received Royal Assent and will be brought fully into force in 2018. The Act allows for the appointment of a guardian to manage the affairs of a person who has been missing for more than 90 days where certain conditions are met. Where an adult has been missing for months or even years without known cause, families are often left with no means of administering that person’s financial affairs. Under current law (The Presumption of Death Act 2013), the missing person’s spouse, civil partner, parent, sibling or child is required to wait at least 7 years or provide proof that the missing person ‘is thought to have died’ before they can apply for a ‘Declaration of presumed dead’. In the meantime, there is no mechanism which enables the dependants of the missing person to deal with their property and financial affairs and this can lead to serious practical problems. Following calls for reform, the Coalition Government consulted on whether there ought to be a new legal process by which a person (“a guardian”) could be appointed to act on behalf of, and in the best interests of, a missing person. The government then issued a response paper which outlined the key features of the proposed scheme. The new Act, which applies in England and Wales, will alleviate the practical problems currently faced by those who are missing a relative and enable banks and other financial institutions to act with greater legal certainty when dealing with the financial affairs of vulnerable or missing customers.
Fewer divorces, but more silver ones The number of divorces fell by 9 per cent in 2015, in line with a long-term trend. But the average age of divorcees keeps rising, as it has done since 1985 - it is now 45 for men and 44 for women, reports the Financial Times. The result is more complex financial settlements, say lawyers. Older people have more assets and more pension rights, which are themselves increasingly valuable – for example, a £30,000 a year pension entitlement is worth over £1 million. The home, say lawyers, may not be the biggest asset that has to be divided. No big changes on pensions A statement by the government minister in charge of pensions was interpreted by many, including the Financial Times, as signalling there would be no major changes to pension tax relief in the next few years. Reforms to the tax relief system had been considered by the previous Conservative government but such a major upheaval now looks very unlikely. Keep on borrowing The number of mortgage borrowers aged over 70 has soared by 75% in the past five years, says the Mail. Many have obtained new loans because their existing mortgage lender won’t extend the repayment term of their current loan.
Financial Overview Don’t rush to pay off their debt Financial Times columnist Merryn Somerset Webb returns to the subject of student debt as the interest rate on student loans has risen to 6.1 per cent. She points to flaws in the system: all British universities charge pretty much the same regardless of how much their graduates will earn, and graduates repay too little from low salaries and too much from high ones.
Let’s all go to uni There has been a rise in the amount of student housing owned by private landlords, says the Financial Times. Southampton, Leicester, Liverpool, Exeter, Brighton and Hove are among the cities that have seen the largest increases. Letting agents say one reason is the higher yields available on student lets, though costs of management are also typically higher. Save 18 per cent for a pension Once former students enter the workplace to provide for a comfortable retirement, today’s new employees need to save 18 per cent of their earnings to supplement the flat-rate state pension, according to a think-tank report, says the Financial Times. The actual rates used in auto-enrolment pension savings schemes are far below that level. So people entering the workforce today face a “monumental savings challenge”, the International Longevity Centre-UK said in its report.
The key for parents is that any unpaid debt is written off after 30 years (a recent report says 77 per cent of graduates won’t repay the debt in full and write-offs will cost the government £5.9 billion a year). So let them take on the loans, she says, and wait to see if they get a high-paying job: only in that case does it make sense to pay off the debt. The cost of education Parents in the UK who pay for private education for a child at primary, secondary and tertiary levels spend on average £128,600, says the Financial Times, citing research by HSBC. That is ten times the average cost of state-funded education and is second only to average spending in Hong Kong out of the 15 countries in which it conducted its research. A quarter of parents wish they had saved more, but only Chinese parents seem to be good at planning ahead, with most parents still paying the bulk of costs out of current income. Longer wait for state pension Six million people now aged between 39 and 47 will have to wait a year longer to get their state pension, says the BBC. The government announced that the rise in state pension age from 67 to 68 will be brought forward six years to 2037-39. The government said the new rules would save taxpayers £74bn by 2045/46.
Wealth Design in Wales A chat with Gemma Oliver In keeping with Wealth Design Group’s philosophy of managed business growth, their most recent adventure takes them across the border and into mid Wales. We caught up with Welshpool-based Gemma Oliver, Senior Financial Adviser, who is part of the team expanding the coverage. Q: So, Gemma - how did you become a part of the Wealth Design Group? Gemma: Well I’ve worked with one of the founders, Steve Bennett, in the past. It’s been an ambition of mine to become an independent financial adviser, so I was happy when I finally got the chance with Wealth Design. I’m grateful to Steve and David for giving me the opportunity - as a mother of four children under four, I expected most firms to run a mile. Wealth Design have been supportive and flexible, so I just feel lucky to be working with them and I am enjoying building a client base. Q: What are your key values? One promise I make to clients is I always get back to them promptly within 24 hours I will ensure I get back to them. Being responsive is key and essential to build trust and confidence. I am committed to being the very best I can be in my role. Since having my children I successfully passed a number of the industry qualifications. I am currently studying an advanced paper in Pension Planning (AF3). Passing this will get me one step closer to the ‘Chartered Financial Planner’ status that is widely accepted as a gold standard qualification for professional advisers.
Q: Can you tell us a bit about where you are based? Gemma: The area I am focusing on is Mid Wales and the Borders. I am based in a small town called Welshpool, around 20 miles from Shrewsbury just on the other side of the Welsh border. Welshpool has a population of around 6.5k and I’m happy to travel around an hour and a half for client meetings, so we cover a decent area. I’ve already got a few clients in Machynlleth, Newtown, Shrewsbury, Oswestry, Wrexham, Whitchurch and Wem. Q: What’s your ideal client? Is there such a thing? Gemma: Yes and no. We have quite a varied client base. It’s more about the circumstances when people would look for help in respect of financial advice. These can include people who are starting to think more seriously about their retirement. They may have existing pensions that haven’t been reviewed for several years and are keen to look at options to improve their chances of achieving financial independence for a time when they no longer expect to be working. Another stimulus is when personal circumstances change for example bereavement or divorce. Finally, business owners wanting to maximise their rewards for their hard work and wanting to understand the options available to them.
Team News Q: What’s your approach with Professional Connections? Gemma: I am keen to develop relationships with both Accountants and Solicitors. I believe we can work well together to provide clients with a high-quality service. For example, business owners working with accountants need to look at pension planning and the tax implications of their profits and a qualified and knowledgeable adviser is a great sounding board to look at their options. For solicitors, we can work together on cases where people’s circumstances have changed and they need to assess their options. This could be through bereavement and divorce. Being a financial adviser is a real privilege and a highly trusted role therefore developing long term relationships with clients and professional connections through a consistently high level of service is essential.
Level Up - Our new Paraplanners! As Wealth Design Group continues to grow, so too has our team developed and adapted to provide an even better service to our clients. Fiona Holt of Hunter & Co (Streetly) and Kiran Mann of Wealth Design Ltd (Cannock) have both recently been promoted from Practice Managers to Paraplanners. Although a lot of the work they do is behind the scenes, our new Paraplanners will play a pivotal role in maintaining our quality customer service. As they take more of a lead role in research and report writing, our advisers will be free to spend more of their time with clients, whether face-to-face or over the phone. Congratulations to Fiona and Kiran on your new roles! Meet the team
Q: Well Gemma, that’s just about everything - is there anything else you want to tell us about? Gemma: Well, just that I’m excited. I think the area is under-serviced at the moment. I’ve heard of local people travelling to Stoke on Trent to meet their adviser and I am passionate about delivering a high-quality service locally. The Wealth Design Group is something I really believe in, so it’s exciting to bring it to a new area. And with the whole team behind me, I know we can offer a really high level of support to all our current and future clients.
Beth Evans Role Practice Administrator
What did you want to be when you grew up?
Favourite biscuit
Fashion Designer
Favourite motto
Proudest achievement Becoming a Mother
Nickname Betty
I don’t eat biscuits, prefer a packet of crisps. Always one step ahead
Life Ambition Speak a foreign language
Financial News State Pension & Carers Allowance The House of Commons has published a briefing paper looking at the interaction of Carers Allowance and the state pension. Carer’s Allowance is an “income replacement” benefit for people who are unable to work because they are caring full-time for a disabled person. Since 2002, Carer’s Allowance has been payable to people aged 65 or over, but it cannot be paid in addition to the Retirement Pension. This is because of the “overlapping benefits” rule. Although an entitlement to both benefits can mean that Carer’s Allowance is not payable, for lower income pensioners an “underlying entitlement” to Carer’s Allowance can give access to carer additions to means tested benefits such as Pension Credit. For other pensioners however, a claim for Carer’s Allowance may result in them receiving no additional financial support.
In 2017-18, around 367,000 people over State Pension in Great Britain are expected to satisfy the care conditions for Carer’s Allowance, but only around 18,000 will receive the benefit. The overlapping benefits rule does not only apply to people eligible for both Carer’s Allowance and the Retirement Pension. Carer’s Allowance cannot be paid in full if an individual could also get any of the following benefits: •
Retirement Pension
•
Incapacity Benefit
• Contributory Employment and Support Allowance •
Severe Disablement Allowance
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Contribution-based Jobseeker’s Allowance
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Widow’s Pension/Bereavement Allowance
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Widowed Mother’s/Parent’s Allowance
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Maternity Allowance
• Unemployability Supplement paid with Industrial Injuries Disablement Benefit or War Pension •
Training allowances
If the amount of the above benefits is less than the amount of Carer’s Allowance, then the difference is made up. Although there has not been a change to the overlapping benefits principle, it worth remembering what benefits are impacted on receipt of the state pension.
Financial News New rules to hit BTL New rules due to be introduced by the Bank of England at the end of September could make it harder for Buy-To-Let owners to obtain mortgages, says the Telegraph. The rules will require lenders to assess the viability of the whole portfolio if someone owns more than four properties. The change comes on top of restrictions to BTL owners’ ability to claim tax relief on mortgage interest, and there is also uncertainty about how lenders will interpret and apply the rules, so brokers are urging owners to refinance before they take effect. Millions at a loss on pension funds Millions of savers have no idea whether the fund in which their pension savings are invested is any good, says the Times, citing recent research. This showed that many insurers are among those whose funds are in the doghouse, having earned consistently poor returns. The difference between the dogs (bad performing funds) and better funds is equivalent to tens of thousands of pounds at retirement. Regulator fails fund investors The Times is one of several newspapers to criticise the Financial Conduct Authority for not being tougher on fund managers. The FCA’s report into the sector followed a highly critical interim report last year, but the final report proposes no actual measures to reduce fund costs or to introduce what even many fund bosses think is a good idea, a single all-in annual charge that would enable investors to make like-for-like comparisons across the industry. Some blame the FCA’s timidity on heavyweight lobbying by fund management
groups. Motoring with a black box There has been a sharp rise in the number of young drivers using telematics - black boxes fitted to their cars - to cut the cost of car insurance. The Mail cited the case of two 19-year-old sisters who got cover for their small car for £1,600 with telematics after being quoted premiums of up to £7,000 by other insurers. The Mail journalist who tried the black box found it slightly disconcerting – it constantly measures your speed - but confessed that it would probably improve her driving.
Launch of the WD App The Finance & Tax App is packed with tools that our clients and future clients will love, such as:
This powerful new free Finance & Tax App has been commissioned by the team at Wealth Design to give you key financial and tax information, tools, features and news at your fingertips, 24/7. The Wealth Design App is designed to be a helpful place to get critical information whenever you need it. As always, the team at Wealth Design is on hand to provide professional, personal advice and guidance.
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GPS Mileage Tracker
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Receipt and Expenses Management
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Income Tracker
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17 tax, VAT and financial calculators
You also get instant access to the latest business and personal accountancy facts, key dates and tax updates - the ‘News’ section will be updated regularly, so you get the latest news, views and offers from Wealth Design - in real time, all through your App. The app is available through Apple Store and Google Play.
Read our Story
As part of our entry to the Express and Star 2017 Business Awards, we wanted to tell people about the Wealth Design Story. The Wealth Design Storybook tells the story of our founding, our growth and our plans for the future. It is available to view under “About Us” on the website.
Wealth Design Ltd
Hunter & Co. (IFA) Ltd
Lagonda Suite | Virage Point | Green Lane | Cannock | WS11 0NH
46 - 48 Thornhill Road | Streetly | Sutton Coldfield | B74 3EH
Telephone: 01543 571238 Email:
[email protected] Web: www.wealthdesign.co.uk
Telephone: 0121 353 4856 Email:
[email protected] Web: www.hunterwealth.co.uk
Wealth Design Limited is registered in England (Company No. 09198203) and is authorised and regulated by the Financial Conduct Authority. FCA No 647119
Hunter & Co (IFA) Limited is registered in England (Company No. 03673023) and is authorised and regulated by the Financial Conduct Authority: FCA Number: 191615
2017 Wealth Design Group Limited is registered in England. Company number 10258292. Registered Office: Lagonda Suite Virage Point, Green Lane, Cannock, Staffordshire, England, WS11 0NH
