Christmas: the perfect time to health check your taxes

| Tax Planning | No Comments

Material gifts are often welcome at Christmas time – but what about more disposable income in your pocket, especially after a tumultuous year in 2020? Taking a few hours to check your tax plan can be the perfect opportunity to do so – especially the quieter moments of the December break. This is especially since the average UK household can expect to pay…

How to keep building your retirement plan in 2020

| Pensions | No Comments

COVID-19 has overshadowed almost all aspects of life in 2020 – including retirement planning. How might the pandemic affect your plans (and ability) to retire, especially for those looking to start accessing their pension savings within the next 12 years? Undeniably, events this year have presented additional challenges to these people. These will need to be carefully…

8 areas where financial planning beats accounting

| Financial Planning | No Comments

What’s the difference between a financial planner and an accountant? Why might you use one over the other? In short, the latter helps with auditing and financial statements – such as your tax self-assessment leading up to the financial year (April in the UK). The former helps you with the big questions of how to build and protect your wealth, covering areas such as…

A 6-point checklist when choosing financial protection

| Protection | No Comments

Taking out a policy for life insurance, critical illness cover (CIC) or income protection is a big decision. Not only is there a monthly cost to factor into your finances, but there is also a range of checks which are required to ensure that the protection in question meets your needs. In this article, our team here at Elmfield Financial Planning…

Pound cost averaging vs. lump sum investing

| Savings & Investments | No Comments

Should you invest your money gradually or all at once? That is the core question at the heart of the debate about “pound cost averaging” and “lump sum investing”. It might sound like a simple matter of choosing whichever suits your preferences, but the decision can have a huge impact on your returns and the long-term growth of your portfolio…

What is a good diversification ratio?

| Savings & Investments | No Comments

Many people are aware that it is a good idea to invest in a range of assets (e.g. cash, equities and bonds). Yet what, exactly, should the balance be not only between them – but within them. After all, there are many currencies, companies and governments which one could invest in. All of them hold different risks and potential for returns depending on the time and circumstances. In this guide…

A short guide to pension drawdown

| Pensions | No Comments

You may have already spent years putting money aside into a pension. Yet how, exactly, do you eventually use it to generate an income in retirement? It isn’t the same as living off cash savings since pension pots are typically invested in assets such as stocks and bonds, which carry higher investment risk but also more growth potential. In 2020-21, moreover, you cannot start taking money out of your pension…

2020 probate backlog: make sure your estate is in order

| Financial Planning | No Comments

COVID-19 is now recognised by the Office of National Statistics (ONS) as the seventh leading cause of death in the UK. Thankfully, so far NHS hospitals have not been flooded in the manner widely feared at times earlier in 2020. Yet the pandemic is causing problems in other areas such as funeral services and – for the purposes of this article – probate, where families are waiting months for inheritance tax cases…

How might negative interest rates affect investors?

| Savings & Investments | No Comments

If you’ve never heard of negative interest rates before, you’re not alone. For many years, such an idea has remained exactly that amongst economists – an idea which could work in theory, but perhaps not in practice (similar to how scientists typically regard faster-than-light travel). Yet the idea of negative interest rates has recently been tried by economies such as Sweden, Japan and even the European Central Bank (ECB)…

Life insurance FAQs in October 2020 – some answers

| Protection | No Comments

In 2020, financial protection has increasingly gained public attention in the wake of coronavirus. Many people are understandably worried about their health, jobs and income – wanting to make sure their loved ones have access to maximum financial stability should the worst happen. Life insurance is particularly important in this respect – providing a much-needed lump sum to your surviving family members…

Financial planning & advice: the difference, and why it matters

| Financial Planning | No Comments

Financial advisers. IFAs. Financial planners. Investment advisers. Pension transfer specialists. For the uninitiated, labels like these may appear synonymous and unimportant. Yet there are key differences which do matter – especially if you find yourself needing help understanding and making decisions involving complex matters of wealth and personal finance.

Pandemic financial planning for the self-employed

| Financial Planning | No Comments

Self-employed workers form an important part of the UK economy. In December 2019, about 5m people were registered as self-employed in the UK – up from 3.2m in 2000. Overall, this makes up about 15.3% of the country’s workforce – with freelancers alone contributing £300bn a year to the economy. Yet despite their contribution self-employed people…

Diversification: a short guide to investing

| Savings & Investments | No Comments

If you’re wondering how to start investing or develop your portfolio, then at some point you will hear about diversification. In simple terms, this refers to the practice of spreading out your investments across many different markets and asset types. Rather than putting all of your eggs in one basket (e.g. by investing all your capital in one stock), this approach helps you to mitigate unnecessary risks.

Can I rely on the state pension for retirement?

| Pensions | No Comments

It is estimated that as many as 15m people (i.e. 1 in every 3 retirees) in the UK have no pension savings at all. Those over the age of 50 are especially at risk of pension poverty, since there is less time to build up a viable strong retirement fund (although it is certainly not too late). Many people seem to believe that the government will look after them when they stop working, much like the National Health Service…

How generosity can result in tax benefits

| Tax Planning | No Comments

It’s easy to assume that financial planning is all about ourselves. Yet there is a place for giving and charity too. Moreover, engaging in generosity can also make sense from a tax perspective – both for the giver and also the recipient. In this short guide, our financial planning team here at Elmfield offer these thoughts on charitable financial planning and its tax benefits.

How to get your head around pension allowances

| Pensions | No Comments

The UK pension system can easily leave people confused. Not only does it deal with finances which seem to be in the far future, but the tax regime and “compounding dynamic” which take place on pension investments can also be quite complicated. There are also a range of pension allowances available which are intended to incentivise people to save towards their…

Setting strong financial goals: a short guide

| Financial Planning | No Comments

For many people in 2020 life has felt very out of control. Bringing clarity and a sense of order to your wealth and finances, therefore, is a great way to bring stability and peace of mind to your situation. Here at Elmfield, our financial advisers in Padiham, Burnley, Lancashire offer some thoughts on how to set strong financial goals which move you in a positive direction.

5 core components to wealth preservation

| Tax Planning | No Comments

Some people are fortunate enough to happen upon wealth. For many of us, however, they have carefully built up their savings, investments and assets over many years and want to make good decisions about how to look after them. Especially as you look ahead into retirement where they will play an important role in sustaining your lifestyle; and then even…

Should I withdraw 25% of my pension in a pandemic?

| Pensions | No Comments

The question of what to do with your 25% tax-free pension lump sum has come into sharper focus in 2020. In stable times, this is a big decision given the vast sums involved and the impact upon your nest egg. Yet since the COVID-19 pandemic and subsequent volatility in the stocks markets, many pensions across the UK (which are typically invested in them) have taken…

Divorce in later life – how to protect your retirement

| Pensions | No Comments

Divorce is not unheard of in later life and, in fact, the figures suggest that it is growing more common. According to the Office for National Statistics (ONS), 7,468 marriages comprising over-65s ended in 2004, with the figure rising to 10,937 in 2014. Whilst money can sometimes be far from people’s minds during the divorce process, it’s crucial to not neglect your financial interests – especially with regards to your pension.