Monthly Archives: April 2023

ALMOST HALF OF UK CONSUMERS FIND PENSIONS INFORMATION DAUNTING

In an era where the cost of living is threatening to undermine consumer confidence, it’s no surprise that almost half of UK consumers find pensions information overwhelming. It can be difficult for individuals to make informed decisions about their retirement planning when faced with such a daunting task.

New research has revealed that half (50%) of consumers feel overwhelmed by pension and retirement information, and more than two in five (41%) do not know what to do next once they receive it.

CONSUMER CONFIDENCE

In the past year, households have been affected by high inflation, rising interest rates and volatile markets. This has taken its toll on consumer confidence and self-belief, with only 59% feeling confident when making financial decisions, down from 63% in 2022. In response to this uncertainty, more people are turning to outside sources for help.

Today, 83% of people view obtaining advice from financial professionals as an important source of support, compared to 73% last year. Pension providers or information on pension provider websites (76%), pension provider literature (72%) and employers (69%) have also all seen an increase in people who find them helpful for retirement decisions.

SOUND FINANCIAL DECISIONS

People primarily require information about their pension and retirement planning in order to make sound financial decisions.

• This includes understanding how much money their pension will provide upon retirement (47%)
• The amount of money currently in their pension pot (46%)
• Ensuring enough funds are being contributed (32%)

SOURCE FOR GUIDANCE

Pension provider websites have become a popular source for guidance, with 41% of people visiting them at least once a year. Other sources include asking friends and family (39%) or surfing the internet for advice (39%). Those who have workplace pensions often look to their employer (33%) or colleagues (29%) for guidance.

Planning for retirement is essential to ensure that your financial future is secure. That’s why it’s really encouraging to see from the research that 93% of those with lower incomes who have taken control of their finances report enjoying retirement, compared to just 66% of those without a retirement plan. Worryingly, however, despite this, 72% are doing nothing to prepare for later life.

WANT TO FIND OUT HOW TO PLAN AHEAD FOR THE RETIREMENT YOU WANT?
Whether you’re years from retirement or it’s just around the corner, it’s important to consider the lifestyle you’ll want when you stop working. There’s a lot to think about. And we can help. For more information about your retirement options, please contact us.

Avoid legal wrangles and confusion over who will benefit from your estate

A valid Will is an incredibly important part of estate preservation planning and will ensure that, should the worst happen, your assets, whether they be Financial wealth or possessions, are distributed in an orderly fashion to the right beneficiaries.
It’s important to make sure that after your death, your assets and possessions go to the people and organisations you choose, such as family members and charities you want to support.
A Will is a very powerful document which will hopefully avoid legal wrangles and confusion over who will benefit from your estate. You can also leave a gift to charities of your choosing.
Wills and Inheritance Tax planning more broadly are sensitive subjects for households across the UK and are often thought of as slightly taboo topics.

TYPES OF LASTING POWER OF ATTORNEY
A Lasting Power of Attorney (LPA) is a way of giving someone you trust, your Attorney, the legal authority to make decisions on your behalf if you lose the mental capacity to do so in the future, or if you no longer want to
make decisions for yourself.

HEALTH AND WELFARE LPAS
A Health and Welfare LPA allows you to appoint an Attorney to make decisions about matters such as:
* Your medical care
* Where you live
* Your daily routine, such as what you eat and what you wear
* Whom you have contact with
* Whether you have life-sustaining treatment – although only if you have
given express permission

PROPERTY AND FINANCIAL AFFAIRS LPAS
A Property and Financial Affairs LPA gives your Attorney the power to do things such as:
* Buy and sell your property
* Pay your bills
* Collect your pension or benefits
* Manage your bank accounts

EMOTIONAL AND FINANCIAL PRESSURE
A Will can provide peace of mind that not only will the correct beneficiaries benefit from any estate distribution, but also that it is done as efficiently as possible. But only 13% of UK adults have written a living Will, which is used to provide advanced decisions on refusing medical treatments if you become terminally ill or lose the ability to make decisions around medical treatment yourself. A further 6% said they had made a living Will, now more commonly called an ‘advance decision.’
While no one likes to think about their own mortality, getting your house in order by having the right legal instructions can take away much of the emotional and financial pressure at a very difficult time.

Taking the first step is always the most difficult but puts you as the benefactor in the driving seat.

ESPECIALLY IMPORTANT IF YOU HAVE CHILDREN
A Will can help reduce the amount of Inheritance Tax that might be payable on the value of the property and money you leave behind. Writing a Will is especially important if you have children or other family who depend on you financially, or if you want to leave something to people outside your immediate family.
If you die without a valid Will, you will be dying intestate and your estate will pass to those entitled under the intestacy rules.
Under the intestacy rules, your estate could pass to unintended beneficiaries and leave your loved ones in a very difficult situation at
an already emotionally challenging time.

PROTECTING YOUR ASSETS AND PREPARING YOU FOR GOING FORWARD ON YOUR OWN

Divorce involves many loose ends, both emotional and financial. It can generate high levels of uncertainty and financial stress, as it impacts on all areas of your life, from living arrangements to assets and pensions. That’s why financial planning through a divorce is essential to help protect your assets and prepare you for going forward on your own.

Making the right financial decisions during your divorce can be difficult. You may be worried about your future and how you will support yourself and your family. Divorce is a difficult time emotionally and financially. It is important to obtain professional financial advice to help you through this challenging period.

This will help protect your interests, ensuring that you receive a fair outcome and your future is secure. It will also enable you to have a clear understanding of your current financial situation. This includes knowing what assets and debts you have, as well as what income and expenses you have each month.

FUTURE FINANCES

You’ll need to be realistic about your future income and expenses. That means putting a realistic budget in place so that you can make informed decisions about your future finances.

Don’t overlook any tax implications based on any financial decisions you make. This is especially important if you are considering selling assets or transferring property.

DIVIDING PENSIONS

One of the most important assets to consider is your pension. Pensions are often overlooked in divorce settlements, but they can be worth a significant amount of money. It is important to get professional advice to make sure that pensions are taken into account in any settlement.

There are several options for dividing pensions in a divorce, and the best option will depend on your individual circumstances. You may be able to keep your pension in its current form, or you may need to transfer some or all of it to your ex-partner.

DIVORCE SETTLEMENT

Whatever you do, make sure that you obtain professional advice before making any decisions about your pension. It is one of the most important financial assets you have, and you need to make sure that it is taken care of in your divorce settlement.

With careful planning and communication, you can make the transition as smooth as possible to help you move on with your life and make a fresh start.

Here are some tips to help you make the right financial decisions during your divorce:

1. Get organised. Gather all of your financial documents, including tax returns, bank statements and investment records. This will help you and your lawyer understand your financial situation and make the best decisions for your future.

2. Make a budget. Once you have all of your financial information gathered, sit down and create a budget. Be honest with yourself about your income and expenses. This will help you make informed decisions about your finances going forward.

3. Understand your rights. Speak with a lawyer to understand your rights and responsibilities during the divorce process. This will help you make decisions that are in your best interests.

4. Communicate with your spouse. If you have children, it is important to communicate with your spouse about financial matters. This can be difficult, but it is important to try to reach an agreement on child support and other financial issues.

5. Obtain professional financial advice. This will help ensure that you are making sound decisions with your finances during this difficult time. There are many factors to consider when going through a divorce. The advice will help you understand the financial implications of the decisions you make, and provide guidance on how best to protect your interests

NEED HELP MAKING THE RIGHT FINANCIAL DECISIONS DURING A DIVORCE?
Making the right financial decisions during a divorce can be difficult, especially when it comes to pensions. If you have any questions about your pension or other financial assets during a divorce, please contact us.

DIVORCE SETTLEMENTS ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.

17% OF SELF-EMPLOYED WORKERS WOULD CHOOSE TO CARRY ON WORKING THROUGH ILLNESS OR INJURY

Many adults understand the need for financial resilience and taking out insurance to protect their incomes in case of sickness or accident. However, too many self-employed people do not have any cover to help them should they be unable to work and are increasingly likely to choose to carry on working despite illness or injury.

New research has identified that 17% of self- employed individuals stated they would need to continue working if they suffered from illness or injury. Despite this admirable effort, it is important that those who are ill or injured take time off for recovery in order to ensure a safe and sustainable working environment.

HEALTH COMPLICATIONS

Taking time off to rest and recover after an illness or injury can be beneficial in the long run, as it allows workers to return to work with renewed energy, and improved concentration and productivity levels. It also helps to reduce the risk of further health complications or accidents due to fatigue or strain.

Millions of self-employed individuals would be forced to keep working in the event of an illness or injury, according to the research. The findings show 60% of self-employed workers would draw from their savings if they were unable to work for two months, and only 6% of self-employed workers surveyed have purchased an income protection product themselves.

FUNDS COULD DRY UP

The data shows that many self-employed individuals rely on their savings without considering how quickly these funds could dry up, potentially leaving them unable to pay their rent or mortgage after a couple of months. One in five self-employed workers said they would rely on their partner’s income or savings if they were unable to work.

Worryingly, 19% would struggle to pay their mortgage or rent if unable to work for two months due to illness or injury, and 11% would resort to taking out a loan, using an overdraft or credit cards.

MOST SUITABLE POLICIES

Protection and financial resilience are an integral part of personal financial planning, so it’s important to obtain professional advice before selecting the most suitable policies. For many, this can be an overwhelming concept to tackle when establishing a personal financial plan.

Taking the time to understand the various components involved in building a resilient financial future is informative and essential for those looking to protect their assets and wealth. From understanding the basics of insurance policies to tax regulations and retirement planning.

ARE YOU AND YOUR LOVED ONES PROTECTED AGAINST LIFE’S ‘WHAT-IFS’?
Protection is about more than simply buying an insurance policy, it’s about ensuring you are supported financially if you are no longer able to work or become ill. If you have any concerns or would like to find out more, please contact us.