Government announces three-month mortgage holiday in Covid-19 package

While, for many, discussions about money can be extremely uncomfortable, experts have long stressed the best approach to financial issues is invariably to talk about them. Indeed, perceived wisdom suggests the more open and honest people are about money, the better their life and relationships tend to be.

Finance: the last taboo
There’s a wide variety of reasons why people don’t like to discuss their finances. In some cases, money is simply viewed as a vulgar subject to talk about, while many individuals lack financial confidence and therefore feel foolish discussing their finances; for others it’s easy to just ignore the issue altogether or simply leave it to someone else to sort out. As a result, many of us don’t like to talk about money, which means finance stands out as one of the last taboo topics in our society.

Importance of financial conversations
A failure to communicate about money though can lead to serious problems especially for other family members. This particularly relates to the younger generation and the importance of nurturing a sense of financial responsibility that will ensure they are ready to take control of their finances. It’s also critical in relation to older people as, if discussions have not taken place, there is no way of knowing their wishes when important issues relating to their financial future inevitably emerge.

Elephants in the room
While it is therefore vital to talk, discussing some financial topics can prove extremely challenging for many people. For example, parents often find it difficult to discuss issues surrounding inheritance and the transfer of wealth which means conversations with their children on this topic can be awkward or stilted. It is imperative, however, that parents do include their offspring when making financial planning decisions in order to ensure they are ready to assume responsibility for family assets when the time arises.

Finance paralysis
An inability to talk about money can also lead to personal finance paralysis, which is basically the fear of making a bad decision. This can result in people either delaying important financial decisions or not making any decisions at all. Talking issues through with a trusted confidante though is a particularly good way to help alleviate such anxieties as it equips people with both the knowledge and conviction to make appropriate decisions.

Talk to us
As with most things in life, it’s usually easier to figure out financial problems if you talk them through with someone you trust. Discussing issues with those people that matter to you can help get things into perspective and thereby aid the decision-making process. And remember, we’re always here to help too, so feel free to get in touch and start a financial conversation with us.

Key Takeaways

• Experts have long stressed the best approach to financial issues is to talk about them
• A failure to communicate about money can lead to serious problems
• This particularly relates to the younger generation and the importance of nurturing a sense of financial responsibility
• It’s also to older people as there is no way of knowing their wishes when important issues relating to their financial future inevitably emerge
• Parents often find it difficult to discuss issues surrounding inheritance and the transfer of wealth
• It is imperative that parents include their offspring when making financial planning decisions
• This will ensure they are ready to assume responsibility for family assets when the time arises
• An inability to talk about money can lead to personal finance paralysis, a fear of making bad decisions
• This can result in people delaying important financial decisions or not making any decisions at all
• As with most things in life, it’s usually easier to figure out financial problems if you talk them through

We’re here to help, so feel free to get in touch and start a financial conversation with us.

On 17 November the FCA confirmed guidance for homeowners struggling financially due to coronavirus. The mortgage payment holidays scheme, first announced in March and then extended in May, has been further extended until 31 March 2021.

How does it work?

• Those who have not yet had a payment holiday will be eligible for payment holidays of 6 months in total.
• Those who currently have a payment holiday will be eligible to top up to 6 months in total.
• Those who have previously had payment deferrals of less than 6 months will be able to top up, as long as total deferrals don’t exceed 6 months. This includes those receiving tailored support and those who are behind on payments.
• Borrowers who have already had 6 months of payment holiday will not be eligible for a further payment holiday. Firms will provide tailored support appropriate to their circumstances. This may include the option to defer further payments.

The FCA has also confirmed that no one should have their home repossessed without their agreement until after 31 January 2021.

Interest only
Borrowers with an interest-only (or part-and-part mortgages) that matures between 20 March 2020 and 31 October 2021 can delay the repayment of capital until 31 October 2021, providing they continue to make interest payments.

Tailored Support
Some lenders have offered tailored support to lenders. Lenders will discuss your individual circumstances to support to customers in a way that reflects the uncertainties and challenges many customers will be experiencing due to coronavirus.

Who to talk to
You should try to maintain your mortgage payments if you can afford to do so. If you want to apply for or extend an existing payment holiday, it is crucial that you speak to your lender. You must not stop making mortgage payments without speaking to your lender first as this could adversely affect your credit.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE

At the recent Financial Adviser Service Awards 2020, Omnis Investments were awarded the coveted 5 stars and also topped the list of winners in their category.

As a part of Openwork, we have exclusive access to Omnis Investments, which has an exclusive range of funds and strategies across the full risk/return spectrum, managed by leading investment managers.

Omnis Investments were put on the top spot for this accolade for service excellence by the people who matter most – advisers and clients.

Over the coming year, Omnis Investments will continue to focus on delivering comprehensive, high-quality investment and wealth management solutions to meet the needs of clients.

They will also continue to improve processes and services for increased business efficiency, enabling us to spend more time doing what we do best – understanding our client needs and providing them with great, personal financial advice.

Why do I have to wait longer?

In 1908, when the first State Pension was introduced in the UK, you would have to wait until the grand old age of 70 before being able to claim. This was at a time when life expectancy at birth was around 40 years for men and 43 for women, and when only 24% of people reached State Pension age!

As recently as ten years ago, women could claim their state pension at 60, while men had to wait until they were 65, but qualifying ages have now been brought into line. The changes were introduced due to increased life expectancy, as people are now likely to spend a larger proportion of their adult lives in retirement than ever before.

66, 67 or older?

To find out your SPA, visit the government website www.gov.uk/state-pension-age - this will provide you with an exact date. However, you are no longer forced to take your pension at this age, so you could consider working longer if that suits your circumstances.

If you were born after April 1960, your pension age will be 67 and people born after April 1977 will have to wait until age 68 under current proposals, although the government is considering plans for this to be brought forward.

How much will I get? 

The State Pension is paid to anyone who has made at least ten years’ worth of National Insurance contributions during their working lifetime. The maximum payment is currently £175.20 a week (£9,110.40 a year), but how much you get depends on how many years you contributed for. To check your State Pension forecast, go to www.gov.uk/check-state-pension.

You may also be able to apply for National Insurance credits or pay voluntary National Insurance to boost your State Pension, although the best options will depend on your individual circumstances.

Key Takeaways

• The State Pension age (SPA) increased to 66 for both men and women in October this year and it’s set to rise further
• The changes were introduced due to increased life expectancy
• To find out your state pension age, visit the government website www.gov.uk/state-pension-age
• If you were born after April 1960, your pension age will be 67 and people born after April 1977 will have to wait until age 68 under current proposals, although the government has plans for this to be brought forward
• The maximum State Pension is currently £175.20 a week (£9,110.40 a year), but how much you get depends on how many years you contributed for
• To check your State Pension forecast, go to www.gov.uk/check-state-pension
• Why not let the recent increase to the SPA act as a reminder to review all your pension pots, including your State Pension.

A timely reminder to plan ahead
Why not let the recent increase to the SPA act as a reminder to review all your pension pots, including your State Pension, to consider whether your savings are going to allow you to have the retirement you’ve dreamed of. We can help you get on track, so why not get in touch?

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested

That’s because the September (Consumer Price Index) CPI inflation figure forms part of the government’s ‘triple lock’ formula used to determine the forthcoming rise in the level of State Pensions.

Triple lock
The triple-lock safeguard was introduced by the Conservative-Liberal Democrat coalition in 2010 and aims to ensure that the value of the State Pension is not eroded by inflation. The three-pronged guarantee states that, each year, the State Pension will increase by whichever rate is higher out of: September’s CPI inflation; July’s average earnings growth, or 2.5%.

And, as September’s CPI was 0.5% and July’s previously announced earnings growth was 1.0%, next year’s State Pension is set to rise by 2.5%, the minimum amount allowed by the legislation. As a result, from April 2021, pensioners on the ‘old’ basic State Pension will see weekly payments increase by £3.40 to £137.65, while the full ‘new’ single-tier State Pension will rise by £4.40 to £179.60.

Don’t rely solely on it
The actual amount of State Pension retirees receive is also dependent on their National Insurance record. To qualify for any State Pension, you need at least 10 years’ worth of contributions, while to obtain the maximum amount, 35 qualifying years are required. This means the amount pensioners receive can vary significantly with some not entitled to any State Pension at all.

Additionally, experts have stressed that, even if you do qualify for the full State Pension, this on its own is not enough to retire on. Indeed, analysis shows that, on average, retirees require more than twice the maximum State Pension to enjoy a comfortable retirement.

Plan, plan, plan
In other words, people need to build up a sizeable nest egg which can be used to supplement any State Pension payments, if they wish to retire in relative comfort. Personal pensions are the most common way of doing this, largely because of their favourable tax treatment, but other investments, such as ISAs, can also be used to accumulate retirement funds.

The key is careful planning. And, as retirement planning is never a case of ‘one size fits all’, it’s vitally important to obtain expert advice to ensure any plans are tailored to meet your specific needs. If you’re worried about how you might survive on the State Pension and need help creating a well-structured retirement plan, then we can assist – we’re only a phone call away.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both.

The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Key takeaways

• Few of us were waiting with bated breath for September’s inflation rate
• But the figure was significant as it forms part of the ‘triple lock’ used to determine State Pension rises
• The triple-lock means payments increase by the greater of: September’s CPI inflation; July’s average earnings growth, or 2.5%
• From April 2021, the State Pension will rise by 2.5% (the minimum amount allowed) with the ‘new’ full weekly payment increasing by £4.40 to £179.60
• Not all pensioners receive this maximum amount though
• Experts say even those that do will not have enough to live on – retirees typically need more than twice that amount to retire in comfort
• People therefore need to build up a sizeable nest egg to supplement State Pension payments and this requires careful planning
• We can help you create a well-structured retirement plan.

And it’s not just adults who are feeling the pressure – our kids are picking up on it too. According to a monthly study of children’s mental health symptoms during the pandemic, children from poorer households were more likely to be unhappy or worried, or show behaviour such as clinginess or restlessness, between March and October 2020 when compared with other children.

How can I support my child?
Tempting as it is to try and protect children from your money worries, a keyway of allaying their fears is to actually get them involved with the household finances – after all, we tend to fear what we don’t understand. Research shows that children who are exposed to conversations about money and financial responsibility are more confident and tend to do better with money as adults3. So, here are some top tips to get your kids on the path to financial success.

Our top tips:

• Regular pocket money – whether it’s £1 or £10 per week, giving children their own money to manage can help foster positive conversations about budgeting, saving and spending
• Reward hard work – offering cash in exchange for household chores is an excellent way to teach children the value of money, i.e., it is something to be earned through work
• Involve them in household spending decisions – whether you’re doing the weekly grocery shop or looking for a new broadband deal, challenge the kids to find better deals! As an incentive, you could even offer them a percentage of whatever savings they make
• Play a board game! – there are plenty of board games that can help kids learn about key financial concepts in a fun way. From Payday, which introduces the concepts of budgeting and living expenses, to Monopoly, which helps kids learn about financial negotiation and dealing with taxes, there are plenty of educational games out there
• Think out loud – talking through any money-related decisions with your children will help them learn by example. Did you just choose a supermarket-own washing up liquid instead of a well-known brand on the weekly shop? Tell them why!

And how can we support you?
Our advisers understand how thinly parents are stretched now. That’s where we come in. Let us shoulder some of the burden so you can concentrate on looking after your family. We can help you explore the available options to get your finances back on track so you – and the kids – can feel positive.

Key takeaways

• Many UK adults are concerned about their finances and job security
• Recent studies show that our children are picking up on our money worries during lockdown
• Teaching kids about money and getting them involved in the household finances is a key way of addressing their concerns
• Ways of doing this include paying them for household chores, involving them in household spending decisions and even playing boardgames like Payday or Monopoly
• We understand how stressed many parents are at the moment, so let us help you with your finances so you can concentrate on looking after your family.

We all know we need to save for retirement, don’t we? But we also know it’s not always that easy to find the spare cash required to do so, especially amid a global pandemic.

Research studies, though, typically show that many retirees wish they’d saved on a more consistent basis and managed to accumulate a larger nest egg. Mike is one of those people who entered retirement harbouring financial regrets.

Plan? What plan…?
Last January, after working for over 45 years, Mike decided it was finally time to retire. But he soon hit a snag; Mike simply hadn’t thought enough about the detail of how he would finance his retirement. Although he knew the State Pension wasn’t huge, he hadn’t realised just how difficult it would be to make ends meet and found it quite a shock when reality hit home.

And Mike isn’t alone. Research suggests more than a third of over 50s either leave their retirement financial plans until the two years before retirement or don’t plan at all. As a result, many retirees are ill-prepared for what’s to come.

Funding retirement
Many people save for their retirement through a pension. Encouragingly, the introduction of auto enrolment has resulted in a rising proportion of the workforce having access to a pension with research highlighting almost three in four workers are now offered a retirement plan by their employer. Worryingly, though, the self-employed largely seem to be neglecting their retirement needs, with just 16% currently saving in a private pension.

An alternative strategy is to use other investments, such as ISAs. These also offer a tax-efficient savings route and can provide greater flexibility than a pension. There is also a specific type of ISA – Lifetime ISA – that 18 to 39-year-olds can use to accumulate retirement funds. Bricks and mortar can also be a valuable source of retirement income, either by investing in buy-to-let property or unlocking wealth tied up in a family home by downsizing or through equity release.

Advice is key
Like many people, Mike regrets not saving more across his working life and has two pieces of advice for younger generations: start planning your retirement in plenty of time and seek expert guidance on how to best organise your retirement finances.

Retirement should be something we all look forward to and enjoy but, to do so, it’s vital to plan ahead. We can help with all aspects of retirement planning, whether you’re just starting out and want help choosing a pension, or you’re ready to utilise your retirement pot and want to know the most efficient way of accessing the funds. Just get in touch if you need our expertise.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both.

The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested

Past performance is not a reliable indicator of future performance and should not be relied upon

• Many retirees regret not accumulating a larger retirement fund
• The State Pension and it can be difficult to make ends meet
• More than a third of over 50s either leave their retirement plans until the two years before retirement or don’t plan at all
• Most people save for retirement through a pension, although other investments such as ISAs or property, can also be used as a source of retirement income
• Plan retirement early and seek expert guidance
• It’s vital to plan for retirement
• We can help with all aspects of retirement planning.

The tax year ends on 5 April 2021, which is Easter Monday this year, so don’t wait until the last minute to double-check you’ve taken advantage of all the tax-efficient allowances available to you. To avoid a last-minute Easter rush, we’re on hand to get you organised with all aspects of your end of tax year planning. Here’s a reminder of some of your main tax planning opportunities:

Pensions
— The current Annual Allowance is £40,000 (for every £2 of adjusted income over £240,000, an individual’s Annual Allowance is reduced by £1. The minimum Annual Allowance is £4,000
— The Lifetime Allowance places a limit on the amount you can hold across all your pension funds without having to pay extra tax when you withdraw money. The limit is currently £1,073,100

Tax efficient investments
— Individual Savings Accounts (ISAs) – maximum annual contribution of £20,000 per adult (stocks and shares, and cash options available, maximum allowance not to be exceeded)
— Junior Individual Savings Allowances (JISAs) – maximum annual contribution of £9,000 per child (stocks and shares, and cash options available, maximum allowance not to be exceeded)
— Enterprise Investment Schemes (EISs) – maximum investment of £2,000,000, relief on investments in certain unquoted trading companies, up to £1m per annum (or £2m as long as at least £1m of this is invested in knowledge intensive companies)
— Venture Capital Trusts (VCTs) – maximum annual investment of £200,000, relief on investment in certain qualifying companies

Making Inheritance Tax-free gifts
— Each financial year you can make gifts of up to £3,000 (in total, not per recipient) and if you don’t use this in one tax year, you can carry over any leftover allowance to the next year (some other exempted/ small gifts allowable)
— To reduce the amount of IHT payable, many families consider giving their assets away during their lifetime. These are called ‘potentially exempt transfers.’ For these gifts not to be counted as part of your estate on death, you must outlive the gift by seven years
— If you have enough income to maintain your usual standard of living, you can make gifts from your surplus income.
Advice is essential as strict criteria apply

Using Capital Gains Tax allowances
— Annual exemption of £12,300 per person, £6,150 for trusts – currently under review, correct at time of publication.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

An ISA is a medium to long term investment, which aims to increase the value of the money you invest for growth or income or both. The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

Past performance is not a reliable indicator of future performance and should not be relied upon.

Due to the high-risk nature of these products (EISs and VCTs) they will not be suitable for everyone.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Key Takeaways

• Why not take on a lockdown project and get your finances in order before the end of the tax year?
• We’re on hand to help you get organised
• The tax year ends on 5 April 2021, which falls on Easter Monday this year
• Pensions - The current Annual Allowance is £40,000, the Lifetime Allowance is £1,073,100
• ISA allowance is £20,000
• JISA allowance is £9,000
• · EIS maximum investment is £2,000,000, VCT maximum investment is £200,000
• Inheritance Tax – gifts of up to £3,000 per tax year, consider potentially exempt transfers and gifts from income
• Capital Gains Tax allowance is £12,300 per person

The US and UK continued their rapid vaccine programmes to combat the coronavirus pandemic, while Europe lagged in its rollout, resulting in a resurgence of COVID-19 cases in some parts of the EU. As a result, the US and UK are likely to be able to reopen their broader economies sooner, while much of Europe still faces strict lockdowns.

Budget brings some relief
In his March Budget, Chancellor Rishi Sunak outlined stimulus measures to support businesses and workers through to the autumn. This much-needed spending foreshadows the largest hike in taxes for decades, with tax and spending decisions to total almost £60 billion in the 2021–22 fiscal year.

In addition, the government mapped out its plan for lifting lockdown restrictions and hopes to be in a position to remove all legal limits on social contact on 21 June. Pent-up demand is likely to push up the pace of economic growth for the rest of this year and in 2022.

US introduces new stimulus measures
In the US, Joe Biden’s $1.9 trillion stimulus passed through both houses of Congress in March. Under the legislation millions of Americans will receive one-off cheques for $1,400 and the unemployed will continue to receive $300-a-week top-ups until September. The OECD believes the stimulus will turbocharge the American economy and add a percentage point to global growth.

The US also leads the world in total coronavirus vaccines administered, suggesting the American economy is likely to begin its recovery process sooner than many other developed regions.

Inflation worries linger
Inflation worries hit bond markets, but the consensus is that any rise in inflation is most likely to be short lived. Government bond prices fell sharply (and yields increased), reflecting concerns about an increase in inflationary pressures as the global economy started to recover from the pandemic. Inflation is detrimental to bonds because it erodes the real value of the fixed interest rates they pay.

Investors are concerned about inflationary pressures as economies reopen, but we don’t expect the likely spike in consumer prices to persist. Inflation is likely to pick up as spending on services surges when lockdowns end, and government spending is another tailwind. But it’s likely to be a fleeting phenomenon and should not pose a longer-term challenge to fixed income markets.

Cyclical stocks are still attractive
Cyclical stocks remain in favour, as vaccines are administered and the economic outlook improves. Cyclicals like financial and energy stocks tend to perform well when the economy is expanding. But sectors that benefited during the height of the pandemic, such as tech, have fallen as prospects for the economy brighten.

This environment has benefited Europe’s stock market, which comprises fewer technology firms than America, and more cyclical companies such as banks and commodity firms. The broad rotation away from tech towards cyclicals looks likely to continue.

Big money in digital art
Commodity prices have risen this year, including copper and other metals used in electric vehicles, as well as oil. But gold lost some of its shine as a safe and steady investment, with its price falling steadily since the start of the year.

The Suez Canal was the scene of a stuck cargo vessel in March, blocking the vital shipping route for several days. Around 12% of the world’s trade happens via the Canal and it is thought that each day of the blockage halted billions of dollars in trade traffic.

In March, auction house Christie’s sold a digital piece of art by contemporary artist Beeple for $69.3 million – the latest example in the market for non-fungible tokens (NFTs). The artwork itself was composed as a single, unique and encrypted image file – the first sale of its kind by Christie’s, with bidding opening at $100. The eventual anonymous buyer paid for the work in Ether, a cryptocurrency.

If you’re looking to buy your first home, you probably already know about the government’s Help to Buy equity loan scheme. It’s proved popular since launch in 2013, with almost 300,000 properties bought as part of the initiative so far. But some aspects of the scheme are changing later this year, and it’s important you understand whether you’ll still be eligible for help.

Are you eligible?
The new Help to Buy equity loan rules apply from April 2021 to March 2023. To qualify, you must:

• be a first-time buyer in England;
• have a deposit worth at least 5% of the property you’re looking to buy;
• borrow a minimum of 5% and up to a maximum of 20% (40% in London) of the full purchase price of a new-build home from the government; and
• buy the property from a homebuilder registered with the scheme.

What are the price caps?
The price of your home can’t exceed the maximum figure outlined by the government. These limits vary depending on where you’re looking to bu

Investing in a responsible way is nothing new. It dates as far back as the 1700s, when religious groups such as the Quakers refused to support companies involved with the slave trade or other activities that conflicted with their values. Ethical funds started to appear in the UK in the late 1960s and early 1970s, which allowed people to invest in a way that reflected their personal values.

Ethical investing usually involves using your principles to filter out certain types of securities. For example, some ethical investors avoid sin stocks, which are companies that are involved or primarily deal with traditionally unethical or immoral activities, such as gambling, alcohol or firearms.

Businesses involved with the tobacco, mining and oil industries are other typical ones to avoid.

A sustainable approach
Investing sustainably is different to ethical investing because it involves considering a wider range of issues – from how companies are managed to the impact they have on the environment and the roles they play in society. Investors are embracing this approach because there’s mounting evidence to suggest these issues affect how companies perform over the long term too.

According to calculations made by the sustainable finance team at Danish bank Nordea, moving your pension savings to sustainable investment funds can be 27 times more efficient than four popular ways of reducing your carbon footprint that involve making lifestyle changes – taking shorter showers, flying less, travelling by train instead of by car, and eating less meat.

It makes good financial sense
Investing in well-managed companies that have a positive impact on society and the environment makes good financial sense. For example, if a company suffers reputational damage because it’s been involved in an oil spill, discovered to be treating its workers poorly or accused of corruption, its share price will probably suffer.

Meanwhile, companies that use energy efficiently, invest in training their employees and pay their executives reasonable bonuses are likely to outperform their competitors and return more value to shareholders. Over the long term, they are also better prepared to meet future strategic challenges and take advantage of new business opportunities.

Incorporating an ESG framework
One of the difficulties with sustainable investing is that there’s no standard definition of what it means. However, environmental, social and governance (ESG) factors provide a useful set of standards to assess potential investments:

• Environmental criteria look at how a company performs as a guardian for the environment, their impact on climate change or carbon emissions, water use or conservation efforts.
• Social criteria focus on a company’s ability to manage relationships with its employees, clients, suppliers and the local communities in which it operates.
• Governance examines a company’s leadership, shareholder rights, audits and internal controls, anti-corruption policies, board diversity, executive pay and human rights efforts, for example.

We believe that by incorporating these measures into our processes for selecting the fund managers we use to build portfolios, we can manage risk more effectively and improve returns. In addition, we expect all our investment managers to integrate analysis of ESG risk and rewards into their own investment processes too.

We only engage with those that are signatories to the United Nations Principles of Responsible Investing, the gold standard in the wealth management industry when it comes to incorporating ESG issues into investment practice. The Covid-19 pandemic has had such a substantial impact on societies and economies around the world, and the relevance of integrating a responsible investment approach is greater now than ever before.

If you want to know more about sustainable or ethical investing visit omnisinvestments.com/about-us/environmental-social- and-governance or get in touch

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Whether we’re crossing the road or getting on a plane, we encounter risks every day. For many of us, life has felt more uncertain than ever over the past year as we continue to deal with the coronavirus pandemic. Although we can’t always control what’s happening in our lives, we can plan for the unexpected.

By taking out a protection policy, you can safeguard your family’s finances if your situation changes. The main types of protection include:

• Life cover – pays out a lump sum if you die
• Health insurance – pays medical costs at a private hospital or private ward
• Critical illness – pays a tax-free lump sum if you’re diagnosed with a major illness
• Home contents and buildings – covers your home’s structure (including fixtures and fittings) and contents (furniture)
• Income – pays out if you can’t work due to illness or injury

As well as peace of mind, protection policies often come with added extras. We’ve highlighted examples of some of the perks you could receive when you take out a policy, even if you don’t make a claim.

Welcome gifts
When you sign up for a protection policy, some providers offer a welcome gift. For example, health insurers sometimes offer gadgets like an Apple Watch to help you track your activity – with some even offering a discount based on the amount of exercise you do each month.

Discounts
Many health insurers offer discounts on gym memberships and weight-loss programmes to help you embrace a healthier lifestyle. Some also offer you the option of taking a health check to reduce the amount you pay each month.

It’s worth noting that when you take out a protection policy, your provider is likely to offer you discounts on other products such as pet or travel insurance.

Additional healthcare options
Some health insurers now cover complementary therapies such as osteopathy and acupuncture, giving you more treatment choices. In addition, counselling services are now included in most health insurance policies and many also give you the option to upgrade your hospital room if you need treatment.

Will writing
Some providers of life insurance give new policyholders the opportunity to draw up a will free of charge.

Cover for children
Many critical illness plans include free cover for dependent children.

What support do insurers offer after the event?
Illness and bereavement help. Many providers give free access to services offering practical and emotional support for those left behind after the death of the policyholder.

Rehabilitation
Insurers usually offer back-to-work support services, including physiotherapy, careers guidance or advice if you choose to go self- employed. If you’re returning to work following a mental health issue, providers will continue to cover counselling sessions for a set period of time.

Whatever type of protection you’re looking for, get in touch and we can help!

They chatted about making a Will a few times, but somehow life always got in the way. Until one day, 10 years later, Pete got a call that would change his life forever. Knocked down by a car while crossing the road, Tom had tragically passed away.

The intestacy trap
Grieving for the loss of his partner, Pete then found out that, due to the UK’s intestacy laws, he wasn’t entitled to inherit any of Tom’s property, financial assets or belongings, unless they were jointly owned. Despite Pete knowing that Tom had loved him and would want him to inherit, the absence of a Will meant that none of that mattered.

Thankfully, Pete and Tom had owned their property as joint tenants, meaning Tom’s share automatically passed to Pete according to the rights of survivorship. However, without children or any surviving parents or siblings, the remainder of Tom’s assets ended up being passed on to a distant uncle with whom Tom didn’t have any contact.

Now, Pete faces a battle to pay his bills and mortgages without Tom’s savings and investments, life insurance policy and even the car that Tom owned but they both used.

How a Will could have helped
Had Tom got around to writing a Will, he would have been able to specify exactly who would receive what from his estate, including his savings, investments, car and other belongings. In addition to writing a Will, Tom could have made his wishes known, by nominating beneficiaries to his pension and writing life policies under trust. By taking these steps, Pete would have been given the extra financial support he now so desperately needs.

As it stands, Pete still has the legal right to claim against Tom’s estate as they had been cohabiting for more than two years - but this will be a costly and time-consuming process and a positive outcome isn’t guaranteed. If Tom had a Will, this added stress could have been avoided.

Don’t put it off
With cohabiting couple families growing faster than married couple and lone parent families, it’s clear that more people are choosing not to get married, just like Tom and Pete. However, there’s a catch. Cohabiting couples have none of the legal protections afforded by marriage, meaning that a Will is one way to ensure your partner inherits according to your wishes. Despite this, research shows three in five UK adults do not have one.

Let us help
Don’t let what happened to Pete, happen to you. Speak to a solicitor or Will writing expert to make sure your loved ones are protected.

The Will writing service promoted here is not part of the Openwork offering and is offered in our own right.

Openwork Limited accept no responsibility for this aspect of our business.

Will writing is not regulated by the Financial Conduct Authority.

Following the outbreak of the coronavirus pandemic, many lenders withdrew low-deposit mortgages. In just under a year, the number of 95% mortgages available to first-time buyers fell from 391 to just three. It’s hoped the scheme will give lenders the confidence to offer low-deposit mortgages again by taking on some of the risks involved.

What is the 5% deposit scheme?
First announced in this year’s Budget, the programme offers first-time buyers or current homeowners the chance to secure a 95% loan-to-value mortgage on homes worth up to £600,000. It’s available on both new-build and existing properties.

The government hopes the scheme will provide an affordable route to home ownership by helping people who may be renting but are unable to save for a deposit.

Buyers will still only be able to borrow in proportion to their income, typically a multiple of 4.5. As a result, the scheme will particularly benefit buyers in lower-value housing markets such as northern England and Scotland.

There are also a number of lenders offering 95% loan to value mortgages without using the government guarantee. With an ever increasing range of options to consider, speak to your financial adviser about the current range of 95% loan to value mortgages.

What’s the catch?
There are a few conditions that you’ll have to meet under the scheme. You’ll need to:

• Buy a property to live in – second homes and buy-to-let properties aren’t eligible.
• Apply for a repayment (not interest-only) mortgage
• Pass standard affordability checks, including a loan-to-income test and credit score assessment.

It’s worth considering the fact that the higher proportion of the property price you borrow, the higher the amount of interest you’ll repay on your mortgage. So it might be good to take a step back and figure out if you can save for a little longer and borrow less.

Speak to your financial adviser about how the 5% mortgage deposit scheme could help you get on the property ladder.

What does loan to value mean?
Loan to value is the percentage of the property value you’re loaned as a mortgage – in other words, the proportion you're borrowing. For example, if you have a 95% mortgage on a house worth £200,000, you would put down £10,000 (5%) of your own money as a deposit and borrow the rest (£190,000).

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

In May, vaccine rollouts gathered pace and pandemic-based restrictions began to lift in many countries. However, a new wave of cases in India raised concerns worldwide.

Despite reports that the UK economy shrank in the first quarter compared with the previous three months, the level of employment increased, although it remains below pre-pandemic levels. Inflation doubled to 1.5% in April, and the next stage of reopening the country took place in May, with indoor dining allowed and air travel to a ‘green list’ of countries.

America saw its GDP grow by 1.6% in the first quarter, bringing it back almost to where it was before the coronavirus struck. Household spending on imported goods from China especially soared – perhaps as a result of stimulus checks and the reopening of services following the vaccine rollout implemented by the new Biden administration.

Inflation is picking up
With increased spending came the news that the US inflation rate soared to 4.2% in April, which is higher than expected, and cause for concern around supply, with bottlenecks pushing up costs for manufacturers and consumer prices. The stimulus checks are thought to account for some of the rise, and experts also believe a boom in consumer demand is behind it too.

The Federal Reserve’s position is that inflationary pressures are temporary, and policymakers believe it will fall back down towards the end of the year. It’s not seen as something that will force central banks to increase interest rates any time soon.

Commodity prices are rising
Commodity prices in May rose, with the price of iron ore and copper reaching record highs. Copper – seen as a bellwether for the global economy – rose to over $10,000 a tonne, surpassing the previous peak set in 2011 (during a commodities boom.) Demand for copper comes from China and the green transition in rich countries: it’s used in a range of industries, from electric vehicles to wind turbines and solar panels.

‘Dr Copper’ is closely watched in markets because of its ability to diagnose important shifts in the world economy. Plans for fiscal stimulus in America and Europe lean towards the ‘greening’ of economies, favour copper demand. As a pliable, cost-effective conductor of heat and electricity, copper is a vital input to green tech.

There is concern that a green energy bubble could form due to the large investment in the sector (like wind, solar or hydro industries.) These companies have stretched market valuations – and may not be earning as much as their share values suggest.

Bitcoin in freefall following Musk snub
The walk-back from Elon Musk in his support of Bitcoin, underlined concerns around the feasibility of cryptocurrencies as a stable investment. Musk – previously an outspoken supporter – announced his company Tesla would not be accepting Bitcoin as payment for its vehicles.

His retraction followed news of the environmental effects from the electricity used to mine the currency. The result was a huge drop in the value of Bitcoin (and other digital currencies) – which continued its plummet days after the announcement.

Estimates suggest that well over one million borrowers have lapsed onto their lender’s default standard variable rate (SVR). Has this happened to you? If so, now could be the perfect time to consider a remortgage, to get your finances in good shape for the year ahead.

Older homeowners seemed to be more reluctant to release cash from their homes in 2020, according to the Equity Release Council. Data from the trade body shows drawdowns from lifetime mortgages fell by 21% last year and 10% fewer plans were agreed than in 2019.

This drop suggests the coronavirus pandemic affected the equity release market in 2020, with activity slipping to a four-year low between April and June. Yet the end of the year was a different story – a backlog of cases meant it was unusually busy, with 11,566 new equity release plans agreed between October and December.

What is equity release?
Equity release enables homeowners who are aged 55 and over to access some of the money tied up in their homes. You can take the money as a lump sum or in several smaller amounts. Many people choose this option to supplement their retirement income, make home improvements or help children or grandchildren get onto the property ladder.

The most common way to release equity from your home is through a lifetime mortgage, which allows you to take out a loan secured on your property, provided it’s your main residence. You can ring-fence some of the property value as inheritance for your family and you can choose to make repayments or let the interest roll up. The mortgage amount, including any interest, is paid back when you die or move into long-term care.

Alternatively, you can take out a home reversion plan, which enables you to sell all or part of your home for a lump sum or regular payments. You can continue living there rent-free until you die, but you’ll have to pay to maintain and insure it. You can ring-fence some of the property for later use. At the end of the plan, the property is sold, and the proceeds are shared according to the remaining proportions of ownership.

Is equity release falling out of favour?
In 2020, £3.89 billion of equity was released from property, compared with £3.92 billion in 2019 and £3.94 billion in 2018, according to the Equity Release Council. These figures suggest people are biding their time before unlocking wealth from their homes, according to David Burrowes, the trade body’s chairman.

Yet interest rates for lifetime mortgages are now falling, which could encourage people to take the next step. The average equity release interest rate fell to around 4% during the last three months of 2020, with the lowest rates now at around 2.3% This rate is less than many of those available on 10-year fixed-rate mortgages, but higher than a lot of products with shorter fixed periods.

Is equity release right for you?
Deciding to release funds from your home isn’t a decision to take lightly. While equity release means you have money to spend now instead of leaving it tied up in your property, it can be a complicated process. Remember that equity release often doesn’t pay you the full market value for your home and it will also reduce the amount of inheritance your loved ones could receive. It’s important to talk to a financial adviser who can help you decide whether the process is appropriate for you.

A Lifetime mortgage is a loan secured against your home. A Lifetime mortgage may affect your entitlement to state benefits, and it will reduce the value of your estate.

The effect of the lockdown on millions of bank accounts has been to boost savings for people whose incomes have remained the same but whose spending has dropped.

With the prospect of life returning to a new normal, it’s a chance to think about how to make the most of these savings and build on them too.

Where were savings made?
Working from home meant the cost of commuting was put on hold. Holidays were not booked, and the closure of restaurants, bars and entertainment venues cut spending in those areas, resulting in slightly healthier current accounts.

All this, the Bank of England estimates, resulted in over £125 billion saved in 2020. Its survey does note that only a fraction of this is likely to be spent by households, suggesting a cautious approach.

This is understandable given the drop in income for furloughed employees, the loss of income for the unemployed and an unstable job market.

How to invest your lockdown savings
Leaving your savings in a high-street bank account won’t build much interest. But there are options out there for those who want better returns on what they’ve saved:

• Invest in a stocks and shares ISA – not only will any dividends paid to you be tax-free, but any gains will also be exempt from capital gains tax.
• Contribute to your private pension – this comes with the benefit of tax relief status on your contribution if you’re a taxpayer.

Other ways to make the most of your savings
Aside from investing, there are some useful ways to use any extra money saved during lockdown:

• Pay down debt – if you have lingering debts, whether they’re credit cards or student loans, consider using your extra cash to help eliminate them for good.
• Mortgage overpayments – you could make regular overpayments on your mortgage, reducing its overall term length and the amount you owe on the loan. Check with your mortgage company about their terms and conditions relating to overpayments.
• Build an emergency fund – this fund should contain enough to cover the essentials for a month (like bills, food and your rent or mortgage payments) if anything were to happen affecting your income. Consider opening a separate bank account — easily accessible to you — to store your fund.

A great place to start with all of these options is to create a budget that tracks your income every month compared to your spending, allowing you to work out how much you can put aside.

Our trusted financial advisers are here to help you find the best ways to invest your money to make the most of your savings — whatever your situation.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

As a nation, we aren’t great with our financial acronyms and terminology. Life is busy and our heads are often full of important things to get done to make it through the week, without having to worry whether we know our LTV from our ERC!

You’re certainly not alone if you’re feeling financially flustered. Recent research has found that more than a fifth of British adults are confused by everyday financial terms.

Worth taking the time to review your mortgage
When you do find some time to settle down on the sofa with a cuppa or a glass of wine in hand, if you are a mortgage holder, it could be a good time to become familiar with one important acronym worth knowing - SVR or Standard Variable Rate.

You may find that you are automatically switched to an SVR when your existing mortgage deal, whether that be a tracker, fixed rate or discounted mortgage, comes to an end. Unfortunately, this could mean you’re paying over the odds, perhaps without even realising.

SVR rarely offer the most competitive rates and the SVR interest rate is usually linked to a percentage above the bank’s base rate, meaning the rate can rise and fall, which makes you more vulnerable to potential interest rate rises in the future.

Take advantage of record low mortgage rates
After two Bank of England base rate cuts earlier this year, mortgage rates have remained at record low levels, so it makes sense to see if you can save money by switching to a better rate.

Good advice that cuts through the jargon
In a complex environment, getting good, clear advice can really pay – so get in touch and we’ll guide you through the process, without using jargon.

Don’t worry if you’re currently locked into a mortgage deal that has exit charges, you don’t have to wait until it has come to an end as your adviser can help you find a deal three or six months before your lock-in period finishes.

Incase you were wondering....
LTV - Loan-to-value
ERC - Early repayment charge
SVR - Standard variable rate

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

Most economists expect inflation to pick up over the next few months as lockdown restrictions ease and shops and restaurants reopen. But is this a cause for concern?

As lockdown measures begin to lift, financial markets are making their adjustments in anticipation of a rise in inflation, with bond yields picking up (meaning prices have fallen) and stock markets rotating from defensive sectors into cyclicals.

What is inflation?
Put simply, inflation measures the change in the prices of goods and services. If it rises then it takes more of our cash to buy things. We all experience inflation in our daily lives, from filling up our cars with fuel, buying groceries or using public transport.

In the UK, the official measure of inflation is the Consumer Prices Index. It’s published by the Office for National Statistics (ONS), which monitors what people are spending their money on, using a basket of everyday goods and services.

The ONS adjusts the basket from time to time to reflect our changing spending habits. During lockdown, there was a shift with products like hand sanitiser and hand wipes being added, and items like white chocolate and ground coffee dropping off the list.

Inflation is all an illusion… or is it?
It’s easy to ignore the impact of inflation on your finances. Most people’s spending habits this month compared with the same time a year ago would probably stick to the same patterns – regardless of inflation at the time – because the differences seem small and therefore wouldn’t affect the way they spend.

If you’re trying to save money though, it’s worth remembering that with interest rates currently lower than the rate of inflation, the real value of any cash savings is falling. In other words, the cost of living is increasing at a faster rate than your savings are growing, which means the spending power of your money is actually falling.

How will inflation affect investments?
Many people in the UK are preparing to spend the cash they’ve saved over the past year when the lockdown ends and shops, restaurants and entertainment venues reopen. Activity is likely to return to pre-pandemic levels and the expectation is that inflation is likely to pick up. Some economists are worried about inflationary pressures. In addition to this is the effect of government stimulus packages on the economy, which would provide another tailwind.

However, experts believe it’s likely to be a short-lived phase and should not pose a longer-term challenge to fixed income or equity markets. The Bank of England does foresee inflation rising towards the 2% mark but believes it will be a temporary phenomenon. Continuing deflationary forces like ageing demographics, technological innovation and global supply chains cast doubt over predictions of a new era of inflation.

Ultimately if you want to beat inflation in terms of finding some good returns on your savings, investing is the best option at the moment – due to cash savings rates being at such low levels.

One of the best ways to ensure your investments are given the strongest opportunity to navigate the effects of inflation on financial markets is through a global, multi- asset portfolio that’s actively managed by a professional team of investors. Speak to a financial adviser to find out more.

One of the best ways to ensure your investments are given the strongest opportunity to navigate the effects of inflation on financial markets is through a global, multiasset portfolio that’s actively managed by a professional team of investors. Speak to a financial adviser to find out more.

When you leave a job, it’s easy to forget about the workplace pension you might have had there. With the average person having several jobs during their lives, along with the 2012 introduction of auto-enrolment for employer-based pensions, it’s not surprising that many of us have more than one pension to our name.

Tracking down your old pensions
All pension providers are obliged to send members of their schemes annual statements to keep them updated on how much their pension contains.

The Association of British Insurers (ABI) estimates 1.6 million pension pots worth billions of pounds are forgotten about due to people just moving home. So it’s vital to write to your old pension providers to let them know if your address changes.

The government is in the process of launching a dashboard where all pension providers will be able to input member details, giving customers the ability to see their pensions in one place. But the process will take some years for all providers to supply their data.

Consolidating your pensions
As to whether you should consolidate your pensions into one pot, the first step should be to check the small print. If you have an older pension (around 20 years or older), you could lose some of its benefits if you transfer and be left with steep exit fees taken out of your pension amount.

Unlike older pension schemes, the newer ‘defined contribution’ pensions are more common and less likely to be affected by exit penalties if you want to transfer them into one place. The funds are invested, which makes consolidation an attractive option.

It’s worth noting that if you’re still paying into a defined contribution scheme and want to withdraw from it, the amount you can pay in and claim tax relief on could reduce.

On average, management fees for workplace pensions are around 1%. Newer pensions could benefit from tax benefits that older ones don’t come with, so it’s always worth checking each policy individually and get some advice from a financial adviser.

Leaving older pensions where they are
Along with exit fees and tax privileges, pre-2006 pensions (that were not affected by tax changes established in 2006) could have benefits like guaranteed annuity rates (promising a guaranteed income after retirement), which could be lost if transferred to another pension pot.

Final salary scheme pensions are probably best where they are, too, due to the nature of their payouts when you retire (based on what you earn at retirement.)

Some people opt to create a self-invested personal pension (SIPP), which lets them choose where their pension money is invested. This is beneficial to those who want to put their money into sustainable funds and make ethical investment choices.

Whatever the situation with your workplace pensions, the first thing to do if you’re thinking about consolidation is to speak to a financial adviser. We can help you figure out the best solution for your individual needs.

Insurance claims for accidental damage increased over the past year as more people worked from home, so it’s a good time to check your own coverage.

Figures from some of the country’s biggest insurance providers have shown a sharp rise in claims of accidental damage during the lockdown.

With many millions now working from home, the chances of accidents and damage to property have inevitably gone up. Halifax Home Insurance reported a rise of 35% for claims between July and September 2020 compared with the same period in 2019.

Types of accidents included damage to computers and other electrical items, broken windows and water leaks. With holidays cancelled, children home schooling and everyone staying in, appliances were used a lot more than normal, along with central heating systems.

Millions paid out in home insurance claims

One Insurance provider paid out £33 million in home insurance claims in 2020, with 15% going towards accidental damage claims. General claims not related to accidents accounted for 25% and were mostly related to appliance and pipework damage.

The biggest rise in claims related to damage to computers and electrical equipment because of spillages. As working from home turned many of us into amateur office managers, the usual health and safety measures within a normal office environment were not easy to replicate – especially with children and pets in the picture.

Admiral reported its accidental damage claims increased by 28% since the lockdown started in March 2020, compared to the previous year. Damaged laptop claims increased by 31% and claims around damage caused by home renovation also rose.

Check your accidental damage coverage

It’s a good time to see what your home insurance policy includes when it comes to covering accidental damage to your property.

1. Check that you have the accidental damage cover in place, because it’s often offered as an optional extra to your home insurance.
2. Check the limits and exclusions on your accidental damage cover, making sure there is enough to cover any new gadgets or equipment you bought during lockdown.
3. If you have made renovations and upgrades to your home during lockdown, try to calculate the extra value they bring to your home to ensure your home policy covers it.

How to avoid accidental damage in your home

Sometimes, accidents just happen. But there are ways to reduce the likelihood of an accident, like keeping drinks in a closed cup, away from computers, or tidying cables to avoid tripping.

With many homeowners installing wooden flooring, it’s worth keeping rugs secure with non-slip backing, and encouraging children to be aware of risks in the home when they are playing.

And it’s always a good idea to have your insurers’ telephone number and the policy details handy for when you need them.

Along with helping you check the small print in your accidental damage policy, your financial adviser is here to help you find insurance plans that work best for you and your family, to make sure you’re best protected.

With the UK leading the way in lifting its pandemic restrictions, the coronavirus Delta variant has put many countries on edge.

Nations experiencing a surge in the Delta variant of the coronavirus are in a race between vaccinating a majority of the public and getting ahead of the new strain in order to lift restrictions with confidence. The US, UK and EU are experiencing spikes in the rates of infections and there is some worry from economists about Europe’s previous positive outlook experiencing a setback due to the rapid spread of the variant across the Continent.

The UK’s ‘freedom day’ did go ahead on 19 July, albeit with businesses and local authorities given the ability to apply their own mandates in areas like mask wearing. The government’s aim to push on with the full reopening of society was boosted by the news from the Office of National Statistics (ONS) of a 356,000 surge in payroll figures for June. This is still below pre-pandemic levels, however.

Uncertainty about the Delta variant led to a volatile period for stock markets towards the end of the month. But fears were alleviated by the expectation of ongoing support from central banks as well as strong corporate earnings in both the US and Europe. In better news for UK markets, London overtook Amsterdam as the biggest share trading centre in Europe. This marks the first time London has taken the mantle since the conclusion of the Brexit transition.

The United Nations estimates that the financial toll of the coronavirus pandemic on global tourism could result in a $4 trillion loss to the global economy. Poorer countries are likely to be hardest hit, mainly because of low vaccination rates.

Inflation and consumer spending continue to rise
On both sides of the Atlantic, a surge in the growth of prices has given economists renewed concern about overheating economies. US consumer prices rose again in June and the inflation rate in the UK hit 2.5% in the same period (which is the highest level since 2018). The Bank of England’s monetary committee believes this is still a temporary phenomenon of strong growth, and expects things to fall back to pre-pandemic levels.

House prices in the US rose by over 14% in the year to April 2021, signifying the fastest rate of growth in 30 years. The American job market continued to regain ground, too, with a further drop in jobless claims in June and July.

China’s surge in stocks and bonds
Focus turned to China, following news that its economy expanded by 1.3% in the second quarter. This was mainly a result of retail sales, a growth in manufacturing and increased investment. The country’s exports also rose in June, along with GDP growth of 7.9%. Global holdings of Chinese stocks and bonds surged, as reported in July, by around 40% to more than $800 billion over the past year.

This is seen as a result of investors purchasing assets at a high rate, even accounting for the tense economic relations between China and the wider international community. China’s crackdown on tech companies like ride-hailing app Didi Global, which has listed its shares in the US market, is an example of causing an air of uncertainty for investors.

The lockdown caused many people to reassess their lifestyles, which for some meant choosing early retirement. But what retirees have found is that pension pots are not matching the period of time needed to enjoy a comfortable life.

Life expectancy is going up. The Office for National Statistics offers an online calculator which gives an estimate of life expectancy – and with it an idea of how many years people will need their pensions to sustain them.

What’s your number?
The ‘Class of 2021’ report from Standard Life Aberdeen lays out how much value an average pension pot needs – around £366,000 if you multiply the average annual amount retirees surveyed said they would spend (£20,000) by 20 years of post- retirement time. A third said they had less than £100,000 saved.

Retirees need more than they think
The survey reported that two thirds of retirees were at risk of running out of money post retirement. Along with people living longer (on average, people aged 55 today will live to their mid-to-late 80s) there is the issue of rising inflation which raises the cost of living as years go by. Volatility in the investment markets also adds to the concern for people approaching retirement when it comes to pensions.

How to plan for the years ahead
Those surveyed did have plans to tackle this issue, however. Half of the those surveyed aimed to reduce the amount of money they spent on a day-today basis in order to save for retirement. Other considerations include downsizing their home and seeking part-time work after retirement in order to generate an income.

There is concern among almost half of those surveyed about being financially ready to finish working in the coming year. Yet many are aware of the need to be prepared when it came to their finances post-retirement, making any necessary adjustments – ideally with help from a financial adviser.

Keeping track of workplace pension plans and thinking about consolidating them into one pot might be a good place to start planning towards the goal of making your retirement as financially worry-free as possible.

Our financial advisers can help you review your pensions and advise on how to make the most of your pension.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

This year has been eventful for bitcoin, with the cryptocurrency reaching a record high and then almost halving in value all in the space of six weeks. The walk-back in May from Tesla’s Elon Musk in his support of bitcoin underlined concerns around the idea of cryptocurrencies as a stable investment. Musk – previously an outspoken supporter – announced his company would not be accepting bitcoin as payment for its vehicles.

What followed was a series of plunges in its value – not helped by the additional news of Chinese regulators signalling a crackdown on the use of digital currencies.

Bitcoin in brief
Bitcoin is a type of digital, decentralised currency, allowing the transfer of goods and services without the need for a trusted third party. The network is based on people around the world called ‘miners’ using computers to solve complex mathematical problems in order to verify a transaction and add it to the ‘blockchain’ – a massive and transparent ledger of each and every bitcoin transaction maintained by the miners. The first to verify is rewarded with bitcoin. Thereis a finite amount of bitcoin that can be produced and, as more are created, the mathematical computations required to create more become increasingly difficult.

Cryptocurrencies can be volatile
Bitcoin’s high volatility (risk) makes it a poor substitute for money in a broad sense. The unsteady air around cryptocurrencies in May showed the speculative nature of this asset class. Bitcoin and cryptocurrencies in general have more in common with commodities and currencies – they are much harder to value than cashflow-producing equities and bonds.

Reasons to be crypto cautious

• Cryptocurrencies are a volatile choice and susceptible to stock market bubbles, which can affect investments negatively during a downturn.
• They’re not a tangible form of investment, and are not regulated, which can be a red flag when it comes to your investments.
• Volatility means investors are likely to act on doubts and sell if they fear a fall in return.

Where to invest?
A sensible approach is to invest in high-quality companies that are well-established businesses. These are usually businesses with strong management teams, serviceable levels of debt and predictable cash flows. To avoid being hit by market volatility make sure your portfolio is invested in a wide range of assets, and less vulnerable to market shocks.

Staying invested when there is a downturn can help you get through any turbulent times and put you in a good position to benefit from any ensuing recovery.

Our financial advisers can help advise you on your investment choices.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

We now know to expect extra spending on Manchester trams, the NHS, post-16 education, incentives for UK investment by overseas companies and even new cutters for Border Force…can there be anything left for tomorrow?

The answer is yes. For a start, 27 October is not just Budget Day, but also the date when the Office for Budget Responsibility (OBR) publishes its latest Economic and Fiscal Outlook and the Chancellor publishes a three-year Spending Review, which will take us beyond the next election.

Much of the pre-Budget releases are likely to include the parts of those documents which the government want to be heard and remembered. Those ‘leaks’ also have the benefit of a degree of spin – for example the emphasis on total spend rather than annual spend: £5 billion sounds much better than £1 billion a year for half a decade, half of which has been previously announced.

The good news is that the latest public sector finance data, published on Thursday, showed that in the first half of 2021/22 the Treasury had borrowed £43.4 billion less than the OBR had projected at the time of the March Budget, giving Mr Sunak some spending wiggle room.

The bad news is that the reduced borrowing still amounted to over £108 billion. Nevertheless, it looks unlikely that any major tax increases will be revealed this week. Mr Sunak has already introduced £42 billion of tax rises this year (corporation tax, NICs, dividend tax) which have yet to bite.

Where the Chancellor may take some tweaking tax action is around the topics sitting in his in-tray. For example:

• The Office for Tax Simplification (OTS) reports on inheritance tax have to date yielded no response beyond a promise – so far unrealised – to simplify application paperwork from the start of 2022.
• The second of the OTS reports on capital gains tax, originally commissioned by Mr Sunak, arrived after the March Budget and might now be addressed. Rumours continue to suggest that CGT rates will be more aligned to those for income tax.
• Pension tax relief is a Budget perennial and the Treasury has still not addressed the issues around net pay arrangements and low earners on which it consulted in 2020.

As ever, the Budget’s most interesting content will be in the detail, not necessarily the headlines surrounding it.

To keep your investments from losing value or slowing the growth of your as- sets, avoid these common investing mistakes.

There are more risks and opportunities than ever for investors to navigate in today’s rapidly evolving markets. Here are four approaches we believe every investor should follow.

Don’t pile into cash – stay invested

The biggest advantage of cash is that it offers relative safety. Cash can help diversify a portfolio during times of volatility and is easy to access in an emergency. With cash you’ll be paid interest on the money, which will be tax free where it’s in an ISA.

You won’t lose any money by putting your money in cash, but it tends to offer lower returns than other asset classes. It’s also important to know about the impact of inflation on your savings and investments as it can make a huge difference to how much profit you make. Cash is seen as a short-term safe haven and should not be held over a substantial period of time to avoid the impact of inflation.

While it’s good to have some cash savings for a rainy day, the spending value of your money can fall over time if inflation is higher than the interest rate you receive. With interest rates on cash investments at historically low levels, and well below the inflation rate, millions have seen the value of their savings eroded in recent years. To make money on your investment you’ll need to find an account or investment that gives you a greater return than the current rate of inflation.

Don’t go chasing fads – think about the long term

Short-term gains can seem appealing for investors, but if you don’t want to lose your savings, it’s best to not believe the hype about the latest investment craze. Choosing the wrong investment can be a costly mistake. Many investors are turning to social media platforms such as Facebook, Twitter, YouTube, TikTok and other unregulated sources for information about investing.

While it may seem tempting to get investment recommendations this way, it puts you at significant risk from volatile stocks or even fraud. It’s easy to jump on the bandwagon, but momentum is typically falling by the time most people join.

Don’t put all your eggs in one basket – diversify

One of the biggest mistakes when investing is putting all your eggs in one basket as it can leave you exposed to fluctuations in the market. If you’ve invested in one stock and something unexpected happens and it plummets, you could find your nest egg suddenly disappearing.

One way to lower risk is by spreading your wealth over a wider range of investments so it’s not concentrated in one place (known as diversification). By diversifying your portfolio, you can reduce the risk that all of your investments will experience the same negative impact at the same time.

Ideally, you should be looking to build a diverse portfolio with a mix of different investments in line with your attitude to risk. A balanced portfolio will contain a mixture of asset classes, such as stocks, bonds, and alternatives.

Sit tight when it’s right

When markets wobble it can be tempting for investors to sell their shares to avoid any further losses. It’s easy to react to short-term losses but the best thing you can do is most often precisely nothing.

Timing the market involves buying and selling investments when you think they will rise or fall at exactly the right moment. It’s a difficult strategy that rarely works and there are too many unpredictable factors.

If you sell into a falling market you will lock in your losses and it could take you years to get back to where you were. While markets can fall sharply, given time they can rebound, so instead make sure you take the long view. Stock markets have a history of recovering from downturns. If you see your investment drop, don’t worry. Just keep your cool and sit tight.

It pays to seek advice

A financial adviser can help you work out how to achieve your long-term financial goals, while taking inflation into account so it doesn’t eat up your returns. Your adviser will speak to you about your attitude towards risk and the level you are comfortable with, helping you make the right investment choices..

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Its nationwide study found 22% of adults prefer to keep all their money in cash while the same number will not consider stock market investments despite potentially higher returns as they don’t understand it.

The Openwork Partnership is warning about the risks to savers of reckless caution – the cost of missing out on higher returns on their money because they stick to cash accounts. Despite the recent Bank of England base rate rise, rates on cash accounts remain below inflation while the FTSE-100 gained 14.3% last year – its best performance for five years.

Excess savings in the UK – the extra amount people have saved because of restrictions during the COVID-19 pandemic – is estimated to be around £163 billion compared with £112 billion a year ago.

Just 15% of those questioned said they had a healthy balance between savings and investments while 14% said they were willing to miss out on higher returns by avoiding stock market investment.

One potential reason for avoiding the stock market highlighted by the research was lack of knowledge – around 11% said they did not know where to go for advice. However, nearly one in 10 (9%) said they had benefited from financial advice in terms of higher returns on their cash.

Claire Limon, Network Director at The Openwork Partnership, said: “It is good news that people have built up savings and the money will be very valuable given the looming rises in the cost of living.

“But there is a real risk of reckless caution costing people substantial amounts from ignoring stock market investment in favour of keeping money in cash when rates remain at very low levels – meaning savers are losing money after inflation is taken into account.

“It is understandable that people are worried about the risks of losing money on the stock market but advice from a professional adviser can help ensure their money works hard for them and any investments are tailored to their appetite for risk.”

The table below shows the picture across the country with people in Wales most worried about investing in the stock market and most likely to want to keep all their money in cash.

JISA and CTFs both benefit
JISAs replaced Child Trust Funds (CTF) in 2011, but those who still hold CTF will continue to benefit from the increased allowance. Both JISA and CTF are a tax efficient way to build up savings for a child. It is not possible to have both a JISA and a CTF.

Savings for children
A junior ISA can be opened for any child under 18 living in the UK and the money can be held in cash and/or invested in stocks and shares. Once the person who has parental responsibility for a child has opened the account, anyone can contribute to it. The child can manage the account from age 16 and at age 18 they can withdraw the money if they want, when the account otherwise becomes a normal cash or stocks and shares Individual Savings Account (ISA). Alternatively, they can keep saving into it as a standard ISA.

The tax benefits for JISAs and CTFs are the same as for an adult ISA. So, there is no Capital Gains Tax and no tax on income.

Investing for their future
Following the Budget, it was reported: ‘By saving towards their future, families can give children a significant financial asset when they reach adulthood – helping them into further education, training, or work.

Junior ISAs and Child Trust Funds are tax-advantaged accounts for children, designed to encourage a long-term savings habit.’

Two principles which apply to many aspects of financial planning are particularly relevant when planning for your child’s financial future:

• The longer the timescale, the more scope there is for your investments to grow
• Taking expert advice can help you avoid potential pitfalls

The potential of a JISA
It is estimated that if £9,000 was invested every year from birth and assuming a 2% annual return, which is obviously by no means guaranteed, the JISA would be worth around £194,000 at age 18. Saving such a large amount is obviously out of the question for most people, but whatever amount you can afford to save for your child’s future, a JISA is an ideal choice.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

Save up
You will need to have saved a deposit - in most cases the bigger the deposit you can put down, the lower your interest rate is likely to be. Open a dedicated savings or investment account and make sure it’s paying a competitive interest rate.

Check your credit score
Even if you’re re-mortgaging or moving up the housing ladder your credit history will be important. A good credit rating can help you secure a better mortgage deal, with a lower interest rate.

The general rule is the higher the score the better, and the more likely you’ll be accepted for a mortgage or other credit. If you’re looking to take out a mortgage or re-mortgage, check your credit score regularly. You can usually get a simple overview for free and it pays to check with several different sources. Credit Karma, Equifax, clear Score and Experian all offer a service to help you understand your rating.

If you find it is lower than expected there are ways to improve it:

• Pay more than your minimum payments on credit cards
• Bring your overdraft down
• Close unused credit accounts
• Register for the electoral roll

Budgeting
It’s important to review your income and outgoings. If you have accounts, memberships or subscriptions that you no longer use, it makes sense to close them down. Cut back on unused subscriptions and watch how much you spend on things like eating out. Prospective lenders will also look at the debt you currently have, including whether your current account is in credit. If you have any savings, it makes sense to pay off loans and credit cards but be sure to leave yourself enough saved to cover emergencies.

Get some good advice
Getting professional financial advice can save you time, money and stress. We know the industry and the most appropriate lenders, to be able to recommend the most suitable mortgage for you. We can also offer useful advice on all aspects of the house buying process. More now than ever, the value of professional advice is immeasurable. As the mortgage market changes, it’s our job to keep our finger on the pulse. We’ll be able to help you get a decision in principle from a lender, which will give a seller the confidence that you are a serious purchaser

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

You might think that people who use financial advisers are just investing in the stock market or need someone to manage their portfolios. But a financial adviser can do a whole lot more.

Different types of financial advice
For an adviser, it’s their aim to help you achieve your financial goals, but that doesn’t just cover building wealth through investment – their expertise can apply to everything from mortgages to life insurance, pensions, saving for retirement or handling an inheritance. Advisers can vary in what they specialise in, and fall under a large umbrella of services including:

Pensions
You may have several workplace pensions that you’d like to consolidate, or you could have questions about drawing an income from your pension. Whatever your circumstances, a financial adviser can examine the details within your pensions to guide you on how to approach them, considering how much you will need to live comfortably when you retire.

Tax
Another area where expert help is needed is tax. From inheritance tax to capital gains tax or working out how much you should be paying (and if there are ways to minimise your tax bill) – is tricky. With the help from an adviser, you can become more tax-efficient and make the most of any tax breaks available to you. An adviser is best placed to help minimise your tax bills and get you the best returns.

Inheritance
An adviser can help you with leaving a legacy – an important part of planning the future of your estate and making sure your wishes are carried out when the time comes, and your wealth is passed tax efficiently. This advice could range from inheritance tax mitigation to making or updating your will.

Mortgages
Mortgages can be a tricky area, whether you’re a first-time buyer, searching for the best remortgage deal or looking for an investment property. A financial adviser can help you navigate the process, find the right type of mortgage and map out how your mortgage will work over the years (and when it could be a good time to review your mortgage). They’ll also be able to let you know your tax obligations if your property is an investment.

Investment
A financial adviser can help you navigate the world of investing safely, helping you take your first steps in investing or reviewing and managing your existing investments, as well as making you aware of any risks along the way and making sure you keep focused on the long-term goals through any market highs and lows. Our advisers have a broad breadth of experience and take an objective approach – offering ongoing advice and expertise – both of which are crucial to seeing your investment and retirement objectives come to fruit.

Our financial advisers are here to help you make sense of your finances, build, and manage your wealth and protect what you have going forward – to the benefit of you and your family.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE

What is remortgaging?

Remortgaging involves taking out a new mortgage on a property you’ve already bought. You might do this to replace an existing mortgage deal or to borrow money against your home.

Is remortgaging right for Mike?

After Mike’s last mortgage came to an end, he didn’t look for a new deal so he was switched onto his lender’s standard variable rate (SVR). An SVR is usually much higher than fixed and tracker rates, and it can go up at any time. Research by Habito found 27% of mortgage holders in the UK are currently on their lender’s SVR, and they worked out - on an average mortgage - this translates to an extra £340 a month. This means Mike could almost certainly benefit from remortgaging.

Other reasons to remortgage

Even if you’re not on your lender’s SVR, there are a variety of reasons you might want to remortgage:

• To beat interest rate hikes. As inflation goes up, interest rates are starting to follow suit, so it may make sense to lock into a low rate now.
• You’re coming to the end of a deal. Mortgage advisers generally agree you should start looking for a new deal around three to six months before your current rate ends. However, the research by Habito found 46% of mortgage holders are unaware of this.
• The value of your home has gone up. A significant rise in the value of your home may have moved you into a lower loan-to-value band, meaning remortgaging may give you access to reduced rates.
• You want to borrow against your home. Remortgaging may allow you to raise money cheaply on low rates. Before doing this, it’s worth getting financial advice to make sure this really is the cheapest way for you to borrow.
• You want to overpay, and you can’t on your current deal. If you’ve come into some money recently, remortgaging will allow you to reduce the size of your loan and possibly get a better rate. You’ll need to take into account any exit fees or early repayment charges to weigh up whether remortgaging makes financial sense.

Where to start

It’s not always clear cut whether you’ll benefit from remortgaging. A qualified mortgage adviser will look at your circumstances and find out exactly what you want to achieve by remortgaging. For example, are you simply looking to reduce your monthly payments or do you want a more flexible mortgage that allows payment holidays? The adviser will then set out the best options available. Regular mortgage reviews can help ensure you’re never overpaying unnecessarily.

If you’d like to speak to someone about your mortgage, we’re here to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

The interest rate on an SVR mortgage is set by the bank or building society and they can put it up at any time. It is usually higher than the rate you’d get with a mortgage deal and can significantly increase your monthly payments.

As the cost-of-living crisis starts to bite, times are tight for Sarah. Her energy bills have skyrocketed. Filling up the car costs a fortune. In fact, she seems to be paying more for everything these days, even her TV subscriptions are getting more expensive. She’s struggling to cover her monthly bills but, with interest rates rising, Sarah’s worried she’s missed the boat when it comes to securing a competitive mortgage deal.

Has Sarah left it too late to switch from her SVR mortgage?

Although the interest rates on both tracker and fixed-rate deals are creeping up, it still makes sense for Sarah to switch away from her SVR mortgage. According to Moneyfacts, in March 2022 the average SVR was 4.61%, while the average rate on a two-year tracker was 2.03% and on a two-year fixed was 2.65%. This means Sarah should be able to make significant savings by switching. And she’s not the only one who could save money. Research by Habito found 27% of mortgage holders in the UK are currently on their lender’s SVR and they worked out, on an average mortgage, this translates to an extra £340 a month.

How can Sarah make sure she secures the best deal possible?

Sarah would almost certainly benefit from speaking to a qualified mortgage adviser. They understand the market and know where to find the best deals. Sarah may have to pay a penalty to switch from her SVR mortgage. Sometimes, you have to spend a year or more on an SVR before switching without a penalty. A professional will be able to advise Sarah whether it makes sense to wait or to pay any penalty and remortgage straight away.

But Sarah is nervous about speaking to an adviser; she finds mortgages confusing.

Mortgages can be complicated but a qualified adviser will be able to explain them simply and answer any questions Sarah has. Mortgage advisers are there to take the effort out of finding the right deal and it’s got to be a lot less stressful than worrying about whether you’re going to be able to pay your bills each month.

If you’re on an SVR mortgage or your current deal is coming to an end and you want to avoid being switched to an SVR mortgage, we’ll be happy to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Omnis-Investment-perspectives-May22.pdf

Mortgages - Sorting the fact from the fiction

Of course, saving for a pension when you’re self-employed is not as straightforward as it is for an employed person, who might automatically benefit from a workplace scheme and employer contributions. We’ve outlined some key points below for you to consider:

Don’t rely on the State Pension

Whether you’re employed or self-employed you’re entitled to the full basic State Pension (currently £129.20 a week) if you’ve paid in 30 years of National Insurance Contributions.

If you’re self-employed you can only claim the additional State Pension if you’ve had periods of employment.

On its own then, State support is unlikely to enable you to continue your current standard of living into retirement. That’s why it’s imperative for the self-employed to find other ways to provide the additional income needed in retirement.

Start saving early

It’s stating the obvious, but the sooner you start saving into a pension the bigger your potential retirement fund. You’ll also have more time to benefit from the tax relief that’s available.

To highlight the importance of saving early, a 25-year-old male looking to retire at 68 would need to contribute £236.25 per month in order to achieve a retirement income of £17,500 a year. If the same man had waited until he was 45 before he started saving, he would need to contribute £495.83 to achieve the same level of income, an additional £259.58 per month.

Minimise the amount of tax you pay

One of the main benefits of paying into a pension is the tax relief the savings attract. For example, if you’re a basic rate taxpayer paying £100 into your pension each month, HMRC will effectively add an extra £20 in tax relief.

The maximum amount you can save each year that attracts tax relief (otherwise known as the annual allowance) is £40,000.

Importantly, if your income is low and you’re not able to save the full £40,000 in one tax year, you can carry forward any unused allowance, and use it against earnings in the next tax year. Please note:

• You must have been a member of a registered pension scheme during the years you want to carry forward
• Your tax relief is limited by your annual earnings in the year you want to carry forward
• You can only carry forward unused allowance from the three previous tax years

What type of pension is right?

The self-employed can choose from a range of different pension products, including stakeholder pensions, personal pensions and Self Invested Personal Pensions (SIPPs). Each has its advantages and disadvantages – we can advise on which is best for you.

Perhaps the most flexible pensions are stakeholder schemes. They allow you to save as little as £20 per month and the charges are relatively low, which is helpful if you have irregular income levels.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes, which cannot be foreseen.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

As well as moving home three times in the space of a year, Carly and Steve gave up takeaways, holidays and their gym memberships. When they finally had enough money for a deposit, they couldn’t apply for a mortgage fast enough. They were crushed when their application was rejected due to a poor credit score.

A good credit score is vital for homebuyers, as this is how lenders assess how much of a risk you pose. The UK has three main credit referencing agencies – Experian, Equifax and TransUnion. They use your personal banking information to assess how well you manage credit. This is summarised in a credit report and by a single number - your credit score. Lots of things can affect your credit score, including moving house frequently, which is seen as a red flag as it can be a sign you’re struggling to pay your rent. So, as well as avoiding frequent changes of address, what can you do to make sure you don’t end up in Carly and Steve’s position?

Check your credit report for errors

Even small mistakes, such as a mistyped address, can affect your credit score. If anything looks wrong, contact the credit referencing agency to correct it.

Register to vote at your current address

This proves where you live and can add 50 points to your credit score, according to Experian.

Build your credit history

Having little or no borrowing history may result in a lower credit score. You can build your credit history by opening a current account, setting up Direct Debits or getting a credit-builder credit card.

Keep up with your payments

By avoiding late or missed payments on existing credit accounts, you show lenders you’re a reliable borrower.

Limit applications for new credit

When you apply for credit, your credit report is searched. Too many searches in a short space of time can impact your credit score. Try to avoid applying for new credit – such as a mobile phone contract or a credit card - during the six months before a mortgage application.

Limit how much credit you use

If you have a limit of £1,000 - on a credit card for example - and you’re using £500, that’s 50% of the available credit. If possible, you should try to make sure you’re using less than 30% of all the credit available to you.

Keep old accounts open

It’s good to be able to demonstrate a long credit history and show you’ve successfully managed a number of different credit accounts. Having unused credit on old accounts also helps limit the proportion of available credit you’re using.

Check your financial links to other people

If you opened a joint account with an ex-partner or previous housemates, their poor money management could impact your credit score. Check you aren’t linked to anyone who may have a negative effect on your score and ask for outdated links to be removed.

Whether you’re a first-time buyer or a homeowner looking to move, we can help find the best mortgage for you.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Since December 2021 the Bank of England raised interest rates from 0.1% to 1.25% to combat soaring inflation.

This move will have a knock-on effect as mortgage lenders raise interest rates in response, which will increase monthly payments for some borrowers.

What does a rise in interest rates mean for your mortgage?
Anyone without a fixed-rate mortgage is likely to see their borrowing costs rise, although how they are affected will depend on the type of product they have. Your adviser can help you assess your mortgage deal and figure out ways to make some much needed savings.

• Only borrowers with a mortgage that moves up or down with the base rate will be affected by the interest rate change.

• This includes tracker mortgages and standard variable rate mortgages (which you revert to when a mortgage deal ends).

Fixed-rate mortgages
Most mortgage holders are on fixed-rate deals so won’t see any change in their monthly payments. This is because the interest rate you pay stays the same for the length of the mortgage deal.

Standard variable rate mortgages
You will usually be moved on to a standard variable rate when your existing tracker or fixed rate mortgage deal ends. For example, if you take out a two-year fixed deal and you don’t remortgage, you will be moved to the lender’s standard variable rate. The rate is likely to be considerably higher than what you were paying before, so your monthly payments will increase, and lenders can raise the standard variable rate whenever they want.

Tracker mortgages
Homeowners with a tracker mortgage will find that their interest rate payments will now go up, but when this happens will depend on their lender. Tracker mortgages are a type of variable rate mortgage that follow the Bank of England’s interest rate. So, when official interest rates go up, the rate on your tracker will rise as well.

As a rule, they do not exactly match the base rate, but are set a level just above it. For example, if the lender’s rate is the base rate +1%, the interest you’d pay in total on your loan would be 1.5%.

Whatever type of mortgage you have, we can advise you about how the interest rate rise might affect you and address any questions or concerns you have.

How to save on your mortgage costs
The best thing you can do is to speak to your financial adviser. For example, if you’re on a tracker mortgage, they will be able to advise whether changing to a fixed-term deal to protect yourself from any further rises is a good idea. They will also let you know about the fees involved when making changes to your mortgage. If you are on a standard variable rate you can switch at any time, so with interest rates rising, your adviser can help you look at available fixed-rate deals.

Homeowners on fixed deals don’t have to worry about their mortgage going up until their current term ends. Most lenders will let you lock into a new deal six months before the current one ends so it’s a good idea to plan.

Whether you’re looking to remortgage or are a first-time buyer, we can help you find the most suitable deal for your circumstances and help keep your costs down.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT

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Is opting out of a workplace pension a false economy?

First time buyers guide to saving for a deposit

Pocket money

Archie is nearly seven - the age when most parents start giving their children pocket money, according to research by Barclays. And the bank says this is a great time to start teaching youngsters about the value of money. By getting Archie to earn his dough by doing household chores, Liz and Dan will help Archie appreciate the effort that goes into earning money and encourage him to develop a strong work ethic.

Pocket money can be paid in cash or using a prepaid card. There are a number of cards available that are designed specifically for youngsters from companies including GoHenry, Osper and HyperJar. A pre-paid card could also be a gentle way for Liz and Dan to introduce Archie to electronic payments and the world of online banking.

Talking about money

By talking to Archie about money and what they spend it on each month, Liz and Dan can help him to appreciate the kind of ongoing financial commitment involved in buying something like a Saint Bernard puppy or a horse. Archie’s probably too young for them to go through their entire household finances with him. But they can start with a large sum and show him how quickly the figure falls as they tick off all their monthly bills.

Showing Archie how they budget provides a good opportunity to talk about the difference between wanting something and needing something. This will also allow Liz and Dan to introduce the benefits of saving as a way of affording treats and luxuries, after paying for essentials.

Making saving visual

Barclays suggests that making it easy for children to visualise how it’s possible for money to grow can help get them excited about saving. Liz and Dan could do this by giving Archie a clear jar to turn into a homemade piggy bank. Alternatively, they could set up a savings account so Archie can go online to see how additional deposits and interest add up over time.

Budgeting for a big day out

Research by the Bank of England found only a quarter (27%) of youngsters in the UK enjoy school lessons about money. The study revealed kids thought using real money in real situations would help make learning more fun.

Archie wants to take a couple of friends to the zoo for his birthday. This offers a great opportunity for him to use money in the real world. Putting Archie in charge of the budget for the trip may help to increase his appreciation of the value of money. Liz and Dan should agree an amount Archie has to spend and ask him to think about how he’d like to use that money. They’ll need to remind him of all the things that will have to be paid for including fuel, entry tickets, food and drink etc. Allowing Archie to take the lead as much as possible during the trip – by handing over cash or holding up cards to make payments – will help boost his financial awareness and hopefully make learning about money more engaging.

Key takeaways:

• Giving children pocket money for doing household chores can help them appreciate the effort that goes into earning cash and encourage a strong work ethic.
• Talking to children about money helps them to understand budgeting and the difference between essentials and luxuries.
• Making it easy for children to visualise how their money can grow may encourage them to save.
• Putting children in charge of budgeting for a big day out can boost their financial awareness and make them more comfortable handling money.

In a bid to tackle rising inflation, the Bank of England has increased the base rate for the seventh time since December 2021. The 0.5% hike takes the interest rate to 2.25% - the highest since November 2008, when the banking system faced collapse. So, what does this mean for you?

The Chancellor’s statement was in two parts: firstly, a pre-emptive media statement in the morning, then an official statement to the House of Commons in the afternoon. He announced what amounts to a near total unwinding of Kwasi Kwarteng’s ‘fiscal event’ of 23 September.

Measures revoked

• The cut to 19% in the basic rate of tax (outside Scotland) from 2023/24 will not take place. Instead, basic rate will remain at 20% “indefinitely”, meaning that even Rishi Sunak’s 2024/25 scheduled timing has been dropped.
• The off payroll working rules in the public and private sectors (often referred to as IR35) will remain in place, reversing their removal at the start of the next tax year.
• The 1.25 percentage points reduction in dividend tax rates, due from 2023/24, will be scrapped.
• VAT-free shopping for overseas visitors will not be re-introduced.
• There will now be no freeze on alcohol duty for one year from February 2023.

Under review

• The Energy Price Guarantee (EPG), which was due to cap average domestic bills at £2,500 a year for two years from the start of October, will be scaled back to last only until April 2023. In the meantime, the Treasury will design “a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need”. Any support for businesses from April 2023 “will be targeted to those most affected”

Measures retained

• The reduction in national insurance contributions, which reached its third reading in the House of Lords on 17 October, will go ahead.
• The stamp duty land tax cuts that took effect on 23 September will not be reversed.
• The extension of the £1 million annual investment allowance beyond March 2023 remains, as do enhancements to the seed enterprise investment scheme (SEIS) and company share option plans.

Financing

The measures unwound today account for about £11 billion of the extra £45 bn of borrowing by 2026/27 created by the 23 September ‘fiscal event’. The U-turn on abolishing the top 45% rate of tax (outside Scotland) and Friday’s decision to keep the already legislated for corporation tax increases were worth about £21 bn, implying that over 70% of Kwasi Kwarteng’s planned borrowing spree has now disappeared.

Based on recent analysis by the Institute for Fiscal Studies, the 2026/27 financing black hole that remains after all the unwinding is about £32 bn, although press rumours at the weekend suggested that the Office for Budget Responsibility (OBR) could add another £10 bn to the IFS’s debt projection.

The Chancellor stated that there will be “more difficult decisions” to come on both tax and spending. Government departments will be asked to find efficiencies within their budgets. In his initial statement Mr Hunt also said, “Some areas of spending will need to be cut.”

Further changes to fiscal policy to put the public finances on a sustainable footing will be announced on 31 October alongside the publication of the OBR’s Economic and Fiscal Outlook.

What is still happening

The National Insurance contribution rate will fall from 6 November 2022.

In April 2022, the National Insurance contribution (NIC) rate increased by 1.25 percentage points to pay for additional health and social care services. In April 2023, a new Health and Social Care Levy was set to replace this rise.

In the Growth Plan in September, it was announced that this rise would be reversed from 6 November 2022 – and this will still happen. So, from 6 November 2022, you will pay a lower rate of NI.

The Treasury has said the change will save nearly 28 million people an average of £330 per year. However, the impact varies considerably depending on what you earn.

This measure will also help you if you run a business. The Treasury say that 920,000 businesses will see an average tax cut of £9,600 in 2023/24.

Stamp Duty has been cut

To stimulate the housing market and to help more people get onto the property ladder, Stamp Duty was cut with immediate effect. Two key measures came into force on 24 September 2022:

• The threshold at which Stamp Duty becomes payable rose from £125,000 to £250,000. If you’re moving home, the rise in the threshold will save you £2,500 if you are buying a house valued at more than £250,000.
• The threshold at which first-time buyers will start paying Stamp Duty rose from £300,000 to £425,000. The value on which first-time buyers can claim relief increased from £500,000 to £625,000. If you are a first-time buyer paying £400,000 for a property, the cut equates to a £5,000 saving.

The table below shows the savings you would make thanks to the threshold rise, assuming you are not a first-time buyer:

If you’re buying a second home (for example, a holiday home or buy-to-let) you’ll normally pay a 3% Stamp Duty surcharge, but you’ll still benefit from this reduction.

Note that these changes apply in England and Northern Ireland. The devolved governments in Scotland and Wales will make their own decision about whether to pass on cuts in due course.

What is no longer happening:

Income Tax cuts to basic and additional rate no longer proceeding

Two Income Tax measures were announced in the Growth Plan:

• Bringing forward a 1p cut in the basic rate, meaning the basic rate of Income Tax would reduce to 19% in April 2023.
• The abolition of the 45% additional-rate tax band.

Both these tax cuts have been scrapped along with confirmation that the basic rate of Income Tax would remain at 20% “indefinitely, until economic circumstances allow for it to be cut”.

The Telegraph reports that reintroducing the 45% tax band means someone earning £200,000 will be £2,500 a year worse off, while someone on £180,000 will miss out on £1,500 in tax savings.

The Times reports that the reversal means someone earning:

• £15,000 a year will miss out on future savings of £24 a year.
• £30,000 will forego a saving of £174 a year.
• Just over the higher-rate threshold, will miss out on a £377-a-year tax cut.

The BBC reports that, overall and for a typical household, all these policies taken together will mean tax cuts of £290, rather than £500, driven by the scrapping of the rise in NI.

For the wealthiest 10% of households, tax cuts have been reduced from £5,380 to £1,650.

Dividend Tax will remain at its current level

The Dividend Tax rates for basic- and higher-rate taxpayers would have been reduced by 1.25 percentage points, and the additional-rate Dividend Tax rate would have been abolished alongside the 45% Income Tax band.

This decision has also been reversed which means dividend taxation will remain at the current rates of 8.75%, 33.75% and 39.35% for basic-, higher- and additional-rate taxpayers respectively.

If any part of your income is in dividends – perhaps from shares or as a company director – you will continue to pay these higher rates of tax.

Corporation Tax will still rise in April 2023

The Corporation Tax rise, planned for April 2023, was set to no longer proceed in order to “maintain a competitive business tax regime, which will support investment, innovation and economic growth in the UK”.

This policy was also reversed on 17 October with confirmation that Corporation Tax will rise to 25% in April 2023 as previously planned. So, depending on how much profit you generate in your business, your tax bill may rise in April 2023.

The Times reports that this measure is set to raise £18 billion for the Treasury.

2-year support for energy bills restricted to 6 months

In one of the more surprising announcements, the government’s flagship policy to support households facing rising energy costs was stripped back.

One of Liz Truss’s first priorities as prime minister was to shield households from planned Ofgem price cap rises. Truss superseded Ofgem's 1 October price cap of £3,549 with her “Energy Price Guarantee” (EPG) that meant the average annual bill would only be £2,500. She said this guarantee would last for two years.

However, this too has been scaled back to last only until April 2023. A Treasury-led review into how the Government can support energy bills beyond April next year will take place. The review’s objective is to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need.

Consequently, on 1 April 2023, your bills will likely revert to being determined by Ofgem's price cap and wholesale energy prices.

According to Sky News, this will see the average household pay £4,347 a year for gas and electricity from April 2023, instead of the promised £2,500.

How can we help you?

Get in touch with us so that we can work with you to understand the impact of the u-turns and reversals. We’ll ensure we translate all the changes so you can see how your finances will be affected.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

The Bank of England has raised interest rates and warned further hikes are likely in the coming months. This will mean bigger bills for some homeowners.

With announcements relating to energy bills, Income Tax, the State Pension, tax allowances, and Stamp Duty, there are plenty of ways your finances could be affected in 2023 and beyond.

Here are the key points of the autumn statement and what they mean for you.

You may pay more Income Tax in 2023/4 

The chancellor’s announcements mean many millions of workers are likely to pay more Income Tax over the next few years, for two key reasons.

1. Personal Allowance and higher-rate threshold frozen

The Personal Allowance – the amount you can earn before you pay Income Tax – has been frozen at its current level of £12,570 until 2028.

Additionally, the threshold at which the higher rate of Income Tax begins (£50,270) has also been frozen until 2028. So, as your earnings rise, you’ll pay more tax than if these thresholds rose each year in line with inflation.

1. Reduction in the threshold at which individuals pay additional-rate tax

Additionally, Hunt reduced the threshold at which additional-rate Income Tax becomes payable.

You will now pay the 45% rate of tax on any earnings over £125,140 (it was previously £150,000). In simple terms, if you earn more than £150,000, this specific move means you’ll likely pay just over £1,200 a year in additional Income Tax.

You may pay more Dividend Tax and Capital Gains Tax from 2023
As part of his plan to increase tax revenue, the chancellor announced reductions to two key tax allowances.

Dividend Tax
The Dividend Allowance – the amount you can earn from dividends before you will pay Dividend Tax – will reduce from £2,000 to £1,000 in 2023, and then to £500 in 2024.

If you receive any income from dividends, it’s likely that you will pay more tax on these dividends from April 2023 onwards.

Capital Gains Tax
The Capital Gains Tax (CGT) annual exempt amount will fall from £12,300 to £6,000 in 2023, and to £3,000 in 2024.

This means that you will only be able to make profits of £6,000 on non-ISA investments (things like company shares or a second home) in the 2023/24 tax year before CGT becomes due.

Your State Pension will rise
Under the “triple lock”, brought in by the coalition government in 2010, the State Pension increases each year by the higher of:

• The average increase in wages across the UK
• Inflation, as measured by the Consumer Price Index (CPI)
• or 2.5%.

Hunt announced that he would increase the State Pension in line with September 2022’s inflation rate of 10.1%. So, if you’re in receipt of the State Pension, that means a significant boost to your payments from April 2023.

If you’re on the full, new State Pension, the BBC reports that you will receive £203.85 a week, up from £185.15.

Pension Credit and other benefits will also be uprated in line with inflation.

You’ll likely pay more for energy from April
One of Hunt’s initial moves on becoming chancellor was to scale back Liz Truss’s Energy Price Guarantee.

This guarantee ensures that, for six months from 1 October 2022, the average household will pay energy bills of around £2,500 a year.

In his speech, Hunt announced that, while support for energy bills will remain in place, it will become less generous from April 2023. The guarantee will rise to £3,000 for a further 12 months, meaning you could well see your gas and electricity bills rise again in the spring – although the government say their measures would save the typical household £500 in a year.

There will be additional support for more vulnerable households, such as pensioners and those on benefits.

Inheritance Tax thresholds frozen until at least 2028
At present, qualifying estates can pass on up to £500,000 with no Inheritance Tax (IHT) liability using the nil-rate and residence nil-rate bands.

The qualifying estate of a surviving spouse or civil partner can continue to pass on up to £1 million without an IHT liability.

These two thresholds had already been frozen until 2026. The chancellor announced an extension to this freeze, meaning that the nil-rate bands will remain at these levels until at least 2028.

As house prices and asset values rise, it will become increasingly likely that the value of your estate exceeds the combined nil-rate bands, and that your family may face an IHT bill on your passing.

Stamp Duty changes become a “holiday”
In September, Kwasi Kwarteng announced some increases in the thresholds at which Stamp Duty is payable.

Stamp Duty in England and Northern Ireland is now only paid above £250,000 while first-time buyers only pay the tax on purchases over £425,000 (and discounted Stamp Duty on properties up to £625,000).

While these changes will remain, the chancellor said they will now be time-limited, ending on 31 March 2025.

Other key announcements at a glance

• The largest-ever rise in the UK’s national living wage. For workers aged 23 and over, it will rise by 9.7% to £10.42 an hour from April 2023.
• Confirmation that the main rate of Corporation Tax will increase to 25% for companies with over £250,000 in profits from April 2023.
• The lifetime cap on social care costs in England due to come into force in October 2023 will be delayed by two years.
• Electric cars, vans, and motorcycles will begin to pay Vehicle Excise Duty in the same way as petrol and diesel vehicles from April 2025.
• Councils will have more flexibility in raising Council Tax without asking voters.
• HS2 and the Northern Powerhouse Rail schemes will continue as planned.
• A £13.6 billion package of business rates support over the next five years.
• Spending of £2.8 billion in 2023/24 and £4.7 billion in 2024/25 for adult social care and an additional £3.3 billion in 2023/24 and a further £3.3 billion in 2024/25 to improve the performance of the NHS.
• A significant increase in windfall taxes. The oil and gas companies' tax rate will increase from 25% to 35% of profits on UK operations from January 2023 until March 2028, while there will also be a 45% tax on profits of older renewable and nuclear electricity generation.

Get in touch

If you have any questions about how the autumn statement could affect you, we can help. Please get in touch to arrange a time to chat.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Overpaying on your mortgage now could save you more on interest down the line and help reduce your mortgage payments. It could also make sense to overpay on your mortgage rather than keep your money in a savings account, because you’ll earn more in interest savings on your mortgage than you could earn in a typical savings account.

An overpayment is any additional payment you make over your usual monthly mortgage payment. Overpayments can either be a one-off lump sum or a regular overpayment made throughout the year. Overpaying on your mortgage means you can potentially clear your mortgage balance quicker.

Lenders will offer you better rates if you have a lower loan to value. The more you can pay to reduce your mortgage, the potentially lower interest rates you’ll have when you come to remortgage to a new deal.

Overpaying on your mortgage might not be right for everyone. Using savings to overpay on your mortgage could leave you with less cash to fall back on in an emergency.

Not all lenders have the same rules for overpaying and there may be a penalty fee called an Early Repayment Charge if you overpay too much.

You should only make overpayments if you’re sure you can afford them. It’s a good idea to make overpayments if you already have an emergency fund, and you don’t have any other, more pressing debts that need to be repaid.

We can help guide you through all your mortgage options including advice on making overpayments.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Offset mortgages can help you save money over the course of your deal as there’s less interest to pay over the longer term. Interest rates on offset products can be higher than on an equivalent standard repayment deal, but thanks to the savings placed aside, these are charged on a smaller loan amount. This means you will pay less mortgage interest while the savings are offset.

An offset mortgage can help to lower your monthly repayments or lead to earlier repayment of your balance. There is also no tax to pay on the benefit received from an offset mortgage.

We can help guide you through all your mortgage options including whether an offset mortgage is right for you.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

On a capital repayment mortgage, the quicker you pay off your balance, the bigger your monthly payments will be. By having a longer term, you may benefit from a lower monthly payment, but you will also pay more interest.

Whether you’re taking out a new mortgage to buy your first home or have had a mortgage for several years and want to remortgage, it’s important to consider how soon you want to be ‘mortgage free’. You should weigh this up against a mortgage term that makes your monthly repayments affordable.

We can help guide you through all your mortgage options including advice on the term of your mortgage.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Approved by The Openwork Partnership on 30/01/2023

The start of a new year is a great time to review your finances – whether it’s your savings and investments, mortgages or insurance policies.

Here’s a guide to your annual tax allowances, including ISAs, pension contributions and gifts – and why it’s important to make the most of them.

It’s a good idea to know how your investments are taxed when selling them. Here are some of the ways you can organise your assets to make them tax efficient.

Companies that are doing well pay out extra money, called dividends, to shareholders. However, the amount can be taxed depending on how much money you earn

Think twice: Why cancelling your financial protection during the current cost of living crisis could be a bad idea

Why having an emergency fund matters and where to hold extra cash reserves

Inflation explained – why is it so high and how could it affect you?

What does the cost of living crisis mean for your retirement savings?

5 practical ways to protect your money during the cost of living crisis

Winners

Over-50s returning to work
In his speech, the Chancellor said that “older people are the most skilled and experienced people we have”. So, he announced steps to make it easier for those over 50 to work for longer.

Firstly, the government announced an enhancement to the “midlife MOT” strategy – offering reviews to help individuals take stock of their finances and wellbeing to prepare for a more secure retirement.

Hunt also introduced a new kind of apprenticeship – called a “returnership” – aimed at over-50s who want to return to work.

The Chancellor also announced some significant pension reforms aimed at encouraging more over-50s to remain in work, or to return to work. This brings us to…

Pension saver
The Lifetime Allowance (LTA) restricts the amount of tax-efficient pension savings an individual can accrue in their lifetime.

Having reached a peak in 2012, the LTA has been frozen at £1,073,100 since 2020.

To encourage people to remain in work, rather than retiring to avoid punitive tax charges for exceeding the lifetime limit, Hunt made the unexpected decision to abolish the LTA. The government will remove the LTA tax charge from April 2023, and completely abolish it in a future Finance Bill.

In addition, the Annual Allowance that restricts the amount that you can save tax-efficiently in any one year will also rise, from £40,000 to £60,000 in April 2023. You will also continue to be able to carry forward unused Annual Allowances from the three previous tax years.

Finally, many high earners are also affected by the Tapered Annual Allowance. The Chancellor announced that the minimum Tapered Annual Allowance will increase from £4,000 to £10,000 from 6 April 2023. The adjusted income threshold for the Tapered Annual Allowance will also be increased from £240,000 to £260,000 from the same date.

These are major steps that will allow pension savers to accumulate significantly more tax-efficient pension savings over their lifetime, and reduce some tax disincentives to work.

In addition, once an individual flexibly accesses their defined contribution pension savings, the total tax-relieved pension savings they can make each year is restricted to the level of the Money Purchase Annual Allowance (MPAA). To support those who have left the labour market to return and supplement their income, or build up their retirement savings, the government will also increase the MPAA to £10,000 from April 2023.

Parents with young children
In an attempt to boost growth and get more people into work, working families will have access to 30 hours of free childcare each week for children aged between nine months and four years.

This is alongside boosts to subsidised childcare for parents on Universal Credit including upfront support.

Support will be phased in until every single eligible working parent of an under-five gets this support by September 2025.

Households with high energy bills
Back in November, Hunt announced that the government’s Energy Price Guarantee – an initiative of the Truss administration – would continue in its present guise until April 2023.

Under the guarantee, for six months from 1 October 2022, the average household has been paying energy bills equivalent to around £2,500 a year.

In April 2023, the guarantee was set to rise to £3,000, however the Chancellor announced that the Energy Price Guarantee would be extended by a further three months.

This is designed to keep bills at £2,500 on average and the Treasury says this will save the average family £160 on top of the energy support measures already announced.

Drivers
With inflation remaining high, the Chancellor argued that now is not the right time to uprate fuel duty with inflation, or increase the duty.

So, he announced a one-year extension of the 5p cut in fuel duty, saving the average driver £100 on top of the £100 saved so far since last year’s cut.

In addition, the Chancellor announced an increase of £200 million to the “potholes fund”, taking the annual amount allocated to £700 million. The increase is expected to fix the equivalent of up to 4 million additional potholes across the country.

Pubgoers
While duty rates of all alcoholic products produced in, or imported into, the UK will increase in line with inflation, from 1 August, draught relief in pubs will be up to 11p lower than the relief for supermarkets. This is in addition to changes already due to come into effect in August.

Swimmers
Hunt talked about the risk to swimming pools and other community facilities due to rising costs. In response, he announced a £63 million to fund public leisure centres and pools.

Losers

Businesses with larger profits
Back in 2021, when he was Chancellor of the Exchequer, Rishi Sunak announced that Corporation Tax would rise in April 2023 for businesses making more than £250,000 in profits.

The Budget confirmed that this increase will proceed in April as planned – with around 10% of companies paying the top rate.

Companies with profits of less than £50,000 will continue to pay Corporation Tax at 19%.

However, businesses will be able to offset 100% of their UK investment in IT equipment, plant, and machinery against profits to reduce their tax bills. This is an effective cut to Corporation Tax of £9 billion a year, and the government aim to make the scheme permanent when it is responsible to do so.

Taxpayers
In his November statement, the Chancellor reduced the Income Tax additional rate threshold from £150,000 to £125,140, increasing taxes for those on high incomes.

He also announced that Income tax, National Insurance, and Inheritance Tax (IHT) thresholds would be maintained at their current levels for a further two years, to April 2028.

Over the next five years, this is likely to see many people pay more Income Tax, as rising earnings push them into a higher tax bracket.

In addition, as house prices and asset values rise, it is likely that more and more estates will face an IHT bill over the next five years.

Savers
While it may now be possible to contribute more to your pension tax-efficiently, the subscription limits for tax-efficient ISAs were frozen at:

• £20,000 for an adult ISA
• £9,000 for a Junior ISA.

Smokers
In the Budget document, the Treasury confirmed that duty rates on all tobacco products will increase by RPI plus 2% from 6 pm on Budget day.

The rate on hand-rolling tobacco will increase by RPI plus 6% and the minimum excise tax will increase by RPI plus 3% this year.

Get in touch
If you have any questions about whether you are a winner or a loser from the spring Budget, and how it will affect you and your finances, please get in touch.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

The cost of living crisis is causing many to re-evaluate the benefits of financial advice.

To stay ahead of rising costs and maintain your assets’ purchasing power, your portfolio needs to provide positive returns. Diversification can help you achieve this.

If the end of your fixed rate mortgage is on the horizon (even if it’s months away), then it’s a good idea to start looking at your options today.

If you haven’t got a new deal in place when your fixed rate mortgage ends, your lender will put you onto their standard variable rate, which tends to be higher than the rates on most other mortgage options. So it pays to get the right mortgage for you in place.

When it comes to remortgaging, some people prefer to search the market themselves. This could be time consuming, and the right deals for you might not be that easy to find. Others leave it to the last minute (or even worse forget about it altogether) which can leave them paying more than they need to.

But did you know there’s another way?

By seeking advice from a mortgage adviser now, you could get the right deal for you sooner.

We can search an extensive panel of lenders for you, finding deals and options that you may not have even considered. And by planning your next remortgage steps today, you’ll cut down on the risk of missing your mortgage expiry date.

No one wants to pay more than they need to, so it helps to plan ahead with the support of an expert.

We can expertly find the right mortgage for you – whatever your circumstances.

It’s a myth that you have to wait until your current mortgage plan expires before you can remortgage. In fact, most lenders will allow us to secure a new fixed rate for you months in advance. Plus you can often change your mind after you’ve secured the mortgage, before you renew.

There are plenty of mortgages out there to consider. A green mortgage may work for you if you have a more energy-efficient home, or a long-term mortgage may help if you’re looking to reduce your monthly payments. We will consider your overall financial situation and needs in depth to help find the right fit for you.

We know new doesn’t always mean better and it may make more sense to stay with your current lender. If your current lender is the right option for you, we will tell you.

What if you’re not in the same boat as before?

Everyone’s circumstances change over time! Don’t worry if you’ve had a credit blip, you’re earning less or your property has dropped in value, because that doesn’t mean you’re automatically stuck for choice. Your options are out there, and with an experienced adviser at your side, you’ll be able to find them.

Protect your future by planning ahead with an adviser from Gem FS. 

With thousands of mortgage deals and options on the market, it can be difficult to compare products and feel secure in the knowledge that you’re making the right choice.

But help is at hand – our experienced advisers can protect your time and energy, as well as your mortgage payments! With access to a wide range of lenders and the right search tools at our fingertips, we can find the right deal for you. We’ll also be saving you hours of searching time and mortgage comparison headaches.

Our expert advice will make your mortgage search and application process pain-free, and our inside knowledge will protect you from any nasty surprises. So are you ready to get ahead of the game? Then speak to us today.

Call Danielle on 01980 670403 or drop us an email on admin@gem-fs.co.uk

Your home may be repossessed if you do not keep up repayments on your mortgage. 

Approved by The Openwork Partnership on 26/04/2023

Lots of factors determine mortgage pricing – not just interest rates Even though the base-rate hasn’t changed, we have seen interest rates steadily increasing and it’s likely you will have noticed that mortgage lenders have been decreasing their rates slightly. This is because mortgage lenders use a number of factors to determine mortgage rates and one of these is something called ‘swap rates’ which lenders use to reflect expectations for future interest rates.

Consequently, many mortgage lenders have already priced the latest base-rate increases or non-movement into their rates so the impact on new mortgage deals is likely to be minimal.

In addition, after the UK annual rate of inflation reached 11.1% in October 2022, a 41-year high, it has been falling ever since and this gives banks and building societies more confidence that interest rates could fall in the longer term.

We can help you navigate the mortgage market If you need to remortgage, we can help you navigate the mortgage market effectively. We continuously monitor the mortgage and wider financial market and can compare a huge range of lenders and mortgages on your behalf, finding a solution that’s completely tailored to your needs.

Call Danielle on 01980 670403 or drop them an email on danielle@gem-fs.co.uk. 

 Your home may be repossessed if you do not keep up repayments on your mortgage.

Approved by The Openwork Partnership on 21/09/2023

These days, financial planning is about more than simply looking after your money and protecting your wealth. As well as helping you see results in pounds and pence growth, we can also help ensure you are prepared to meet the challenges you may face in life.

Used as a trusted and impartial sounding board, we can help by:

• Encouraging you to recognise your goals and establish a clear financial road map to help you attain them

• Providing you with someone to listen to you and to help you to arrive at the right financial outcomes – taking an objective view and a way forward

• Managing your investments to maximise returns, while controlling risk, and reducing potential tax charges

• Preparing you to deal with unpredictable outcomes you may not have considered, such as premature death, being diagnosed with critical illness or other unexpected life events that change income, savings, or retirement dates that could have a detrimental impact on your desired lifestyle

• Offering emotional support and guidance to provide peace of mind And the value of financial planning doesn’t stop there.

And the value of financial planning doesn’t stop there.

Financial advice is more than just your money; it covers every aspect of your life

A great financial adviser can serve as an objective ear and help you to prioritise your future spending, helping you to deploy the money that you have in a more meaningful way. Longevity and the ability to live your best life are inherent to great financial advice. So, helping you to understand how a healthier lifestyle can help you to achieve your goals is another important aspect of our role.

With a wealth of knowledge about healthy choices now available, small changes can improve your quality of life and help you live longer and in better health. The ripple effect of living a good life means adjusting your plan to ensure you have enough money to last for a comfortable future.

The unseen value of free support services you can access

If something unexpected were to happen, insurance products and policies can provide valuable peace of mind to you and your family. This could include being too sick to work, suffering a life-threatening illness, or death.

In addition, insurance products often also include a wide range of practical and emotional support services. Many of these additional benefits are available at no extra cost and can be used by your family members too. These extra benefits are usually available as soon as your policy starts and remain open to you and your family until the policy ends. This kind of added value is automatically built into your insurance policies but can often be forgotten about or overlooked.

Although the type of complementary services will depend on both the policy and the insurance provider, they tend to be fairly similar and could include:

• Medical related services

- 24/7 access to a doctor through a virtual consultation

- An expert second medical opinion on your diagnosis

- Private prescription services

- Medical care while abroad

• Counselling services

- Mental health and other support services – usually remote and without a long wait

- Physical rehabilitation

- Support to help you get back to work

• Preventative services

- Nutritional support

- Health checks

Structuring a sustainable income

Trust is one of the primary drivers of a successful client/adviser relationship. We proactively monitor your needs and investment portfolios. This means we’re well-positioned and able to recognise when changes are needed. Knowing that life can get in the way of even the best-laid plans, we have annual review meetings to help you stay on track. These regular reviews will help make sure your actions and investments remain aligned with your goals. Shockingly, the Financial Conduct Authority (FCA) revealed that only 8% of the population use a financial planner.

At your review, we’ll often use cashflow planning tools to explore the financial impact of various scenarios. This helps ensure that you’ve thought about all aspects of your financial future, including inflation, so that whatever the future holds, you can be better prepared for whatever life might have in store for you.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Get in touch

If you’re worried about the rising cost of living and want to reap the financial and emotional benefits that speaking to a financial planner can bring, we’re here to help. Please get in touch to arrange a time to chat.

Approved by The Openwork Partnership on 04.10.2023

A growing trend According to data published by The Telegraph, close to half a million people have taken out private medical insurance over the past year, as NHS waiting lists hit record levels this autumn. According to government statistics almost 7.8 million people were waiting to start routine hospital treatment in September 2023.

Against this backdrop, it’s hardly a surprise that more people than ever are considering the benefits of private medical insurance including faster access to medical treatment for themselves and their families.

It’s not just speed of access, it’s also about the quality of care you receive, the flexibility of choosing where and when you would like to receive treatment, and the range of treatments, medicines, facilities and consultants available to you. Cost-restrictions in an already stretched NHS mean that not all breakthrough treatments are accessible. With private medical insurance you can sleep easy, safe in the knowledge that the very best care is available.

It’s more affordable than you think Avoiding lengthy waits for treatment and quality of care are just two of the biggest attractions of taking a route which has traditionally been seen as too expensive for most. But through our specially selected health insurance partner we can help you find the right policy for your budget. If you already have private medical insurance, we may be able to find you cheaper premiums for your circumstances, and all with a free no obligation quote.

The pandemic provided a reminder to us all of just how precious good health is – and acted as a reset for many. Health became a priority, and continues to be so. Spending money on private medical insurance may not have previously been a priority but protecting you and your family over the long-term means a growing number of people are taking the time to consider a more proactive approach to getting the treatment they may need.

We love our NHS but we know the pressure it’s under We have nothing but respect for the hard-working and talented individuals who make the NHS what it is. But we also know that the service that has given so much to so many is under unprecedented pressure. We also know that there is often a faster and better alternative.

We can make sure you get all the information you need to decide whether private health insurance is the right option for you.

Call Danielle on 01980 670403 or drop us an email on danielle@gem-fs.co.uk

Approved by The Openwork Partnership on 30/10/2023

• The government is reducing debt and borrowing, with borrowing forecast to be lower this year, next year, and on average over the forecast period compared to the OBR's March forecast.

• Underlying debt is also lower as a percentage of GDP, by an average of 2.1 percentage points across the forecast.

• The government is on track to meet its debt and borrowing fiscal rules with greater headroom against both rules compared to spring.

• The government has made available up to £14.1 billion for the NHS and adult social care and an additional £2 billion for schools in both 2023-24 and 2024-25.

• Total departmental spending will be £85 billion higher in real terms by 2028-29 than at the start of this Parliament (2019-20).

• Households on the lowest incomes have benefited the most from government decisions on tax, welfare, and public spending since Autumn Statement 2022.

• The government is introducing the largest package of measures to tackle tax non-compliance since 2016, which is forecast to raise an additional £5 billion of tax revenue over the next five years.

• The government is continuing to drive forward the Public Sector Productivity Programme to reimagine the way public services are delivered.

Cutting tax and rewarding hard work

Tax Cuts for Workers

• The main rate of Class 1 NICs will be cut from 12% to 10% from 6 January 2024, benefiting over 29 million workers.

• The average worker will receive a tax cut of over £450 in 2024-25.

• Class 4 NICs for self-employed will be reduced from 9% to 8%, and Class 2 NICs will be abolished.

National Living Wage Increase

• The National Living Wage will increase by 9.8% to £11.44 from 1 April 2024.

• The age threshold will be lowered from 23 to 21 years old.

• This will benefit over 2.7 million low-paid workers.

Welfare Reform

• The government is launching a Back to Work Plan, with over £2.5 billion in funding, to help people find and stay in work.

• The Fit Note process will be reformed to support returning to work after illness.

• The Universal Support programme will be expanded to match people with disabilities to jobs.

• The Work Capability Assessment will be reformed to provide better support.

• Additional Jobcentre Support will be expanded.

Changes to the benefit system

• All working-age benefits will be uprated by 6.7% in line with inflation for 2024-25.

• Pensioner incomes will be protected by maintaining the Triple Lock.

Support for High Cost of Living

• Local Housing Allowance rates will be raised to the 30th percentile of local market rents.

• This will benefit 1.6 million low-income households.

• The government has provided £104 billion in support to households to help with the cost of living.

Backing British business

The government is taking action to boost business investment and drive long-term economic growth.

Key measures include:

• Making full expensing of plant and machinery investment permanent, worth over £10 billion a year.

• Simplifying and improving R&D tax reliefs, worth £280 million a year.

• Removing barriers to investment in critical infrastructure.

• Providing £4.3 billion of business rates support over the next five years.

• Reforming the pensions market to unlock investment into high growth sectors.

• Announcing further targeted support for digital technology, green industries, life sciences, advanced manufacturing, and creative industries.

• Investing £4.5 billion to unlock investment in strategic manufacturing sectors.

• Confirming the next set of investment zones in Greater Manchester, the West Midlands, and the East Midlands.

• Doubling the flexible funding envelope for each investment zone from £80 million to £160 million.

• These measures are expected to raise business investment by around £20 billion per year in a decade's time.

Changes to ISAs

The government is making changes to simplify ISAs and provide more choice, meaning it will be easier for people to choose the best ISA accounts for their needs and move money between them. This involves digitalising the ISA reporting system to make it more effective, as well as expanding the investment opportunities available in ISAs to include Long-Term Asset Funds and open-ended property funds with extended notice periods.

Key highlights:

• Allowing multiple ISA subscriptions – The government will allow multiple subscriptions to ISAs of the same type every year from April 2024.

• Allowing partial transfers between providers – The government will allow partial transfers of ISA funds in-year between providers from April 2024.

• Removing the requirement to reapply for an existing ISA annually – The government will remove the requirement to reapply for an existing dormant ISA from April 2024.

• Expanding the Innovative Finance ISA to include Long-Term Asset Funds – The government will allow Long-Term Asset Funds to be permitted investments in the Innovative Finance ISA from April 2024.

• Expanding the Innovative Finance ISA to include open-ended property funds with extended notice periods – The government will allow open-ended property funds with extended notice periods to be permitted investments in the Innovative Finance ISA from April 2024.

• Allowing certain fractional shares contracts as a permitted investment The government intends to permit certain fractional shares contracts as eligible ISA investments and will engage with stakeholders on implementation.

• Digitalise the ISA reporting system – The government is announcing the digitalisation of the ISA reporting system to enable the development of digital tools to support investors.

• Harmonise ISAs to those over 18 years of age – The government will harmonise the account opening age for any adult ISAs to 18 from April 2024.

• The government is freezing the Individual Savings Account (£20,000), Junior Individual Savings Account (£9,000) Lifetime Individual Savings Account (£4,000 excluding government bonus) and Child Trust Fund (£9,000) limits at their current levels for 2024-25.

Create your budget in four steps

Setting up a budget won’t take long, and if you stick to it then you could boost your savings at the same time. Your budget should chart your income, outgoings and financial goals and give you a spending plan to follow.

A budget can put you in control of your money because you’ll know exactly where each pound is being spent (or saved). And any savings you make in a month or money you bring in in addition to your regular income can be included in your budget.

Most importantly a budget can help you save and plan for the fun stuff in your life, whether it’s a holiday or something on your wish list.

Here’s how to get started:

1. What’s your income?

Record your earnings every month – this means your income after tax and deductions, and any other income (like freelance work or rental income). Try to save around 10% of your net income each month.

2. List your monthly fixed costs

For example, rent or mortgage, utility bills, council tax, memberships or subscriptions, groceries, childcare and transport. Also include debts and loans like credit card balances, loan payments and overdrafts.

3. Minus your fixed costs from your monthly income

Your result should leave you with some money spare. If not, what adjustments could you make to help you get there? Are there subscriptions or items you could cut to help you save?

4. What are you aiming for?

Do you have an overall goal – like saving for a new car or paying off a loan or credit card? See how much you can set aside once you’ve done your calculation.

Don’t forget your emergency fund

Budgeting can help you build an emergency fund – which is an amount of cash set aside to cover around two to three months of essentials in case something unexpected happens. By having a plan for your money and staying in control of it, you’ll be in a stronger position to handle sudden and unexpected expenses.

It pays to pay into your pension

If your workplace has a pension scheme for its employees, part of your wage will automatically be paid into it every month. You might be tempted to reduce your contribution or even cancel it if you’re decades away from retirement or could do with a little more in your pay packet each month.

However, statistics show that many of us do not have enough in our pension pot for our retirement when the time comes. Most employees say their pension will only provide enough money to “just get by” in retirement (39%). Making regular contributions throughout your working life is important to make sure you can enjoy a comfortable retirement.

Many employers match your voluntary contributions up to a certain limit, so you would not only be losing out on your own contributions but potentially on the value your employer would match. If you start paying into your pension earlier, the more tax relief you’ll receive and the more time your overall pot will potentially have to grow.

How much are you putting into savings?

Here’s a common 50/30/20 breakdown of how to budget. (Remember to combine your incomes if you have a spouse or partner).

• 50% of your monthly income is spent on essentials

• 30% is spent on the fun stuff and treats

• 20% is spent on paying off debt or putting towards savings

How does inflation affect your earnings?

Inflation can reduce the purchasing power of your money because prices for goods and services go up as inflation rises. If you get a 5% rise in your wage, you might assume that gives you extra money every month to spend. But if inflation is at 10%, your wage is actually 5% behind and unable to keep up with the cost of living.

If your annual salary is £25,000:

• To keep up with the most recently published inflation rate (4.7%, October 2023), your pay would need to increase to: £26,175: a pay increase of £1,175 per year

• If your pay increased in line with current average pay growth (7.9%, September 2023), it would increase to: £26,975: a pay increase of £1,975 per year

The Potential Benefits of Starting Early

*This example is based on the assumption of a 5% investment growth each year after costs and that you don’t take out a 25% tax-free lump sum at 55. If you’re 21 and start putting £200 into a pension each month, your pot may be worth £227,371 if you retire at 68.* However, if you opt out of your pension scheme and delay starting until aged 40, the fund may only be worth around £73,346.

Saving £200 into a pension each month

Starting at age 21

£227,371

Starting at age 40

£73,346

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Tax concessions are not guaranteed and may change in the future. Tax free means the investor pays no tax.

Get in touch

Speak to your adviser to help you maximise your earnings and for guidance in areas like pension contributions. Please get in touch to arrange a time to chat.

Approved by The Openwork Partnership on 28.11.2023

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With the cost-of-living crisis showing no signs of lessening its grip, despite earning over £50,000 a year, Lisa is finding she has less and less disposable income at the end of the month. With the cost of her daughters’ continuing education and her own retirement on her mind, she is finding money is becoming a constant source of worry. After giving up work, she was planning to throw her kayak in the back of her campervan and explore Europe. But she’s becoming increasingly concerned that those retirement plans will have to be seriously curtailed.

Why it’s more expensive being a single parent

Lisa is one of 2.9 million single parents in the UK, with a quarter of all families in this position. And research shows it’s more expensive raising a child alone. Figures from the Child Poverty Action Group, the cost of a child report, reveals that in 2023, the full cost (including housing and childcare) of raising a child in the UK was £166,000 for a couple and an eye-watering £220,000 for a single parent. Single parents pay more because fixed costs like transport are shared between fewer people, so a higher proportion of those costs are attributable to the child.

As a result, single parents like Lisa are being disproportionately affected by the cost-of-living crisis. A report from the charity Gingerbread found the financial situation of two in three single parents in the UK is worse than it was a year ago, with one in five using credit to pay for household essentials and a similar number turning to food banks.

The same report revealed one in three single parents have seen the amount of debt they have increased over the past year, with almost half of those finding themselves more than £1,000 deeper in debt. In total, 76% of all single parents are in debt and half of those owe more than £2,000.

So what financial support is there for single parents?

If you’re a single parent, it’s worth using a benefits calculator to check you’re claiming all the financial support you’re entitled to. There’s a calculator on the Gingerbread website or you can use the government one.

Depending on your situation, the benefits and financial support you may be able to claim include:

• Child benefit
• Council tax reduction
• Universal credit
• Widowed parent's allowance
• 15-30 hours of free childcare
• Tax-free childcare
• Healthy start vouchers
• NHS low-income scheme
• Free school meals

Why single parents should get financial advice

If you’re a single parent, it makes sense to get financial advice regardless of your age or income. Whether you’re approaching retirement like Lisa or you’re at the start of your career, speaking to a professional can be vital in ensuring you make the most of every penny and avoid costly mistakes. Expert advice is useful for everyone but arguably more so if you’re a single parent with children who are financially dependent on you.

A financial adviser has the experience and market knowledge to assess your situation accurately and provide recommendations for suitable products and services. So, if you’re a single parent and you’d like advice on any money-related matters, we’d be delighted to help.

Cybercriminals use a wide range of tactics to con people out of their money. Stay one step ahead with these five crucial tips to avoid financial scams.

1. Stay informed

Knowing how to spot a financial scam is your first line of defence. Fraudsters are constantly changing their tactics so regularly educating yourself about common approaches like phishing, identity fraud and romance scams are crucial to staying one step ahead.

Action Fraud and other consumer protection organisations offer a wealth of valuable resources and updates on emerging scams. You could also subscribe to newsletters from trusted financial news outlets like The Financial Times, attend webinars on financial safety, or follow reputable financial organisations on social media.

2. Secure your personal information

Practising good information security is another vital step for warding off financial fraud. Insecure personal information is highly valuable for scammers, and they’ll go to great lengths to acquire it. Implementing strong security practices can significantly reduce the risk that your data will be stolen and used against you.

Use complex, unique passwords for each online account and update them regularly. Enable two-factor authentication wherever possible and be cautious about the personal information you share on social media and public platforms.

Remember to secure your offline data too. Shred documents containing personal information before you bin them, avoid writing your passwords down, and consider keeping important documents in a secure location such as a safe.

3. Do your research

Scammers rely on you taking them at face value. Research the claims made by anyone who contacts you out of the blue, even if they seem legitimate. Genuine organisations will understand if you want to verify the details of a situation.

Unexpected contact, a sudden change of details or time-sensitive opportunities are all indicators of a scam. Search online to see if other people have experienced a similar situation or contact an organisation directly to confirm if the circumstances are genuine. If someone contacts you claiming to work for someone you trust, such as a solicitor or financial adviser, stop the interaction and contact that person directly.

4. Take your time

Criminals want you to act without thinking. They usually try to play on your emotions or rush you into decisions. They may tempt you with time-sensitive opportunities or claim that other consumers are already benefiting from their offer.

Take a step back to assess the situation objectively, do your own research and ask someone you trust for advice. Scammers want you to act quickly and may refuse to provide contact details or threaten to withdraw an offer if you don’t. Remember that if something seems too good to be true, it probably is.

5. Report suspicious activity

If you think you’ve been the victim of a financial scam you should immediately report it to the police. You should also contact your financial institutions to freeze your accounts, seek advice, and potentially prevent fraudulent transactions.

You should still report scam attempts even if you haven’t become a victim of a scam. You can report suspicious activity to Action Fraud and other consumer protection organisations to increase awareness of new scams and criminal tactics.

Contact the police if you think you’ve been the victim of a financial scam. You can also forward suspicious emails to report@phishing.gov.uk and forward suspicious text messages to 7726 for free.

For more information about financial scams visit www.actionfraud.police.uk. If you’re in England or Wales, you can also report fraud or cybercrime to Action Fraud on their website or by calling 0300 123 2040.

It’s becoming increasingly popular to use humour during services to reflect the personality of the individual being celebrated. A survey by Co-op Funeralcare on the music people would like at their final goodbye found Another One Bites the Dust by Queen, Going Underground by the Jam and Highway to Hell by ACDC were among the chosen tunes.

After the music’s faded, gravestones offer another opportunity to raise a smile long after you’ve gone. One of the most famous examples of a humorous epitaph is Spike Milligan’s ‘I told you I was ill’. Meanwhile, Mel Blanc - the man behind the voices of Bugs Bunny, Daffy Duck, Porky Pig and many others – opted for the famous Looney Tunes sign-off ‘That’s all folks!’ In a similar vein, gameshow host Merv Griffin, who presented Wheel of Fortune in the USA, went with ‘I will not be right back after this message’.

A funeral that captures the essence of the person being remembered can provide some level of comfort to loved ones during an incredibly difficult time. Another way to make things as easy as possible is to have your financial affairs in order.

Whole of life plans

A whole of life plan provides your loved ones with a lump sum when you die. With some policies, you pay monthly or annual premiums until your death, while others allow you to stop paying at a certain age - although this may impact the amount of money your loved ones receive.

Create or review your will

A will allows you to specify how your property, money and possessions will be distributed when you die. If you pass away without a will, the rules of intestacy will determine this for you and may not reflect your wishes. A will can also be used to set out plans for the guardianship and any future financial support of your children.

Accounts, bills and policies

Make a list of your accounts, bills and policies to help those left behind. This is important in case there are outstanding debts attracting interest that could be settled. Remember to include:

• Current/savings accounts
• Investments/pensions
• Credit cards/loans
• Mortgages
• Insurance policies

Paying for your funeral and other expenses

Dying is costly! According to the SunLife (2024) Cost of Dying Report, you’re looking at an average bill of £9,658. This includes:

• £4,141 – the average cost of a basic funeral
• £2,768 – the average amount spent on extras such as the memorial, death and funeral notices, flowers, order of service sheets, limousines, venue and wake
• £2,749 – the average amount spent on legal professionals
• A pre-paid funeral plan allows you to set aside money to pay for your funeral. These plans were regulated on 29 July 2022. If you are considering buying a funeral plan you should always check the Financial Services Register before engaging with a company or appointed representatives.

If you’d like more information on estate planning, we’re here to help.

Approved by The Openwork Partnership on 03/06/2024.

Will writing not part of The Openwork Partnership offering and are offered in our own right. The Openwork Partnership accept no responsibility for this aspect of our business. Wills are not regulated by the Financial Conduct Authority.

Chancellor of the Exchequer Rachel Reeves outlined the Government’s financial plans for the next five years. The measures, which will raise up to £40 billion for public finances, aim to “restore economic stability” and put “more pounds in people’s pockets”.

On 30 October 2024, Chancellor of the Exchequer Rachel Reeves announced the UK Government’s Autumn Budget alongside the Office of Budget Responsibility’s economic and fiscal forecast. The measures aim to raise more than £40 billion in taxes, plugging an alleged £22 billion black hole in public finances left by the previous government. Reeves committed to drive economic growth, but also said that the Government wouldn’t borrow to fund current spending whilst maintaining the Bank of England’s inflation target of 2%.

Commenting on the Budget, Reeves said: “This Government was given a mandate to restore stability to our economy and begin a decade of national renewal. To fix the foundations and deliver change through responsible leadership in the national interest. That is our task, and I know we can achieve it.”

So, what are the potential impacts of these new measures? Below we outline who stands to benefit from these changes and who might be negatively affected. Let’s start with the positives.

The Winners

The NHS

The Chancellor pledged to significantly increase public spending on the NHS. Reeves promised a £22.6 billion increase to the “day-to-day" budget of the NHS alongside a £3.1 billion boost to its capital budget over the next two years. The Chancellor commented that this would be the “largest real term increase in NHS spending outside of COVID since 2010.”

Sustainable transport and energy

Reeves also announced that the National Wealth Fund would be used to invest in key areas like gigafactories and green hydrogen plants across the country. Meanwhile, over £2 billion will be invested in supporting the automotive sector’s transition to electric vehicles.

Property developers

Funds for the Affordable Homes Programme will increase to £3.1 billion to help Labour deliver on its promise to build over 1.5 million homes. Reeves said the Government would hire hundreds of new planning officers and make reductions to Right to Buy discounts, putting more money into the pockets of local councils. This news could incentivise investment in the UK’s property market and make it easier for property developers to build new homes in the UK.

Drivers

Reeves confirmed that the freeze on fuel duty will continue for another year, meaning drivers could save approximately £60 a year at the pumps. The freeze will cost £3 billion a year, but the Chancellor was clear that she wanted to ease “the burden on motorists”. This move could help relieve the fiscal pressure on delivery drivers, couriers and supply chains throughout the country.

Young and low-income workers

The Chancellor announced that the Government is increasing the National Living Wage for workers aged 21 or over by 6.7% to £12.21 an hour (which could be worth up to £1,400 a year for a full-time worker) and increasing the National Minimum Wage for 18–20-year-olds by 16.3% to £10 an hour. Reeves also confirmed that National Insurance won’t be increasing for workers. Increases to the National Living and Minimum Wages are intended to provide much-needed support to those on the lowest incomes.

Small businesses

The employment allowance for business will increase from £5,000 to £10,500, reducing the National Insurance liability of small businesses. The Chancellor said that this would mean around 865,000 would pay no National Insurance in 2025, providing welcome relief for SMEs who are struggling to retain an effective workforce and attract applicants without a hit to their profits.

The Losers

Employers

Reeves confirmed that employers' National Insurance contributions will increase to 15% from April 2025. The Government is also reducing the threshold at which employers start paying National Insurance from £9,100 to £5,000 per year. Furthermore, the Chancellor announced that the current freeze on income tax thresholds would end in four years. From 2028, personal tax bands will be updated in line with inflation.

These changes will have a direct impact on British employers, but they could also have a knock-on effect for employees. Many businesses use savings on National Insurance to fund pension contributions or employee benefits. If the increased burden of National Insurance contributions proves too harsh, employees could lose these benefits as a result.

New businesses and investors

The Chancellor announced an increase in the lower rate of Capital Gains Tax (CGT) from 10% to 18% and the higher rate from 20 to 24%. She noted that, even with these increases, the UK will still have the lowest capital gains tax rate of any European G7 economy. But some analysts argue that the move could alienate investors and even decrease tax revenue overall if investment is pulled from UK startups.

Foreign investors

Reeves also announced sweeping changes to the tax status for non-domiciled high-net-worth individuals operating in the UK. The Chancellor said that Labour would “abolish the non-dom tax regime, and we will remove the outdated concept of domicile from the tax system from April 2025."

The government is also set to extend the Temporary Repatriation Relief to three years with the aim of bringing billions of new funds into the UK. The independent Office for Budget Responsibility estimates that this could raise £12.7 billion over the next five years.

Second homeowners

The Stamp Duty land tax for owners of second homes (known as the Higher Rate for Additional Dwellings) increased to 5% from 31 October 2024. The Chancellor said that the move is designed to “support over 130,000 additional transactions from people buying their first home or moving home over the next five years." However, this increase could have an impact on landlords, property developers, and the owners of holiday homes and other rental properties.

Private schools

All education, training and boarding services provided by private schools will now be subject to VAT at the standard rate of 20% from 1 January 2025. Private schools also won’t be able to claim back VAT on the supplies and services they pay for.

What’s Next?

The Autumn Budget contained several key changes that are likely to have significant impacts on individuals and businesses across the UK. There’s a lot of information to process and it may not be immediately clear how the

changes set out in the Budget will affect you. If you have any questions about whether you are a winner or a loser from the Autumn Budget, and how it will affect you and your finances, please get in touch.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Approved by The Openwork Partnership on 30/10/2024.

Are you protecting your pension contributions?

When it comes to planning for retirement, making sure your pension contributions are on-track is important. But life can throw curveballs like illness or injury which could make it tough to keep up with contributions.

Why Income Protection matters
Income protection insurance is designed to pay a proportion of your income, approximately 60-70%, if you are unable to work due to illness or injury. This financial safety net ensures that you can continue to meet your financial obligations, including pension contributions, even if you're unable to earn an income.

Protecting Your Pension Contributions
Here's why income protection is crucial for safeguarding your pension contributions:

• Continuity of Contributions
  If you're unable to work due to illness or injury, income protection ensures that you can continue making contributions to your pension fund. This helps you stay on track to achieve your retirement goals.
• Financial Stability
  Income protection provides you with a steady stream of income if you are too ill to work, ensuring that you can cover your living expenses, including pension contributions. This stability allows you to focus on your recovery without worrying about financial pressures.
• Long-Term Security
  By protecting your ability to contribute to your pension fund, income protection safeguards your long-term financial security. It ensures that you have sufficient funds to support yourself in retirement and enjoy the lifestyle you planned for.
• Peace of Mind
  Knowing that your pension contributions are protected by income protection provides peace of mind, both for you and your loved ones. You can rest assured that your retirement savings are secure, regardless of any unexpected health challenges that may arise.

Talk to us to explore your income protection options and we can tailor a plan that meets your specific needs and circumstances. With income protection in place, you can enjoy peace of mind knowing that your retirement fund is protected against life's uncertainties.

Call Gem on 01980 670403 or drop them an email on admin@gem-fs.co.uk

Approved by The Openwork Partnership on 02/10/2024.

Why mortgage rates don’t always drop when the base rate does?

The Bank of England’s Monetary Policy Committee (MPC) is the group responsible for setting the bank base rate (BBR). This interest rate influences the cost of borrowing for banks and the rates they offer on loans, mortgages and savings, all with the ultimate aim of helping to control inflation.

When the committee meets roughly every six weeks, all eyes are on its decision. Based on a large number of factors in the UK economy and also abroad, the MPC will decide whether to raise, hold or cut the base rate.

You may expect a cut to the base rate to mean an instant cut to mortgage rates - however, this isn’t always the case. In reality, the base rate is just one component that influences the mortgage rates offered by a lender.

Swap rates

Another factor is something called swap rates – the rate lenders pay to access money to lend. Think of these like the stock exchange - they fluctuate all the time depending on economic conditions, global factors, market expectations and sentiment. If swap rates increase, then so does the cost for lenders to lend money.

When the economy is stable and inflation is on track, a decision to cut the base rate can cause swap rates to fall and almost instantly bring mortgage rates down. However, if swap rates become unsettled by economic events, future expectations for inflation or challenges abroad, a cut to the base rate may not be enough to calm swap rates, causing the cost for lenders to borrow money to increase.

We have seen this recently following the Chancellor’s Budget. The big policy announcements made by the Chancellor, along with concerns in the Middle East and uncertainty around the implications of the US Presidential race, unsettled swap rates and caused them to rise. Even with the positive news from the MPC to cut the base rate, it wasn’t enough to stop fixed rate mortgages increasing.

What about trackers or SVR?

It’s important to note that this swap rates something that mainly impacts fixed rate mortgages. A cut to the base rate will be felt almost immediately by those who are on a tracker mortgage – a flexible rate that follows the bank base rate – or if you are on a lender’s standard variable rate (SVR) – a changeable rate set by the lender typically after your fixed rate comes to an end.

This is only a minority of borrowers though, as according to UK Finance, 74% of homeowner mortgages are on a fixed rate contract, with 94% of new borrowers choosing this since 2019.

Supply and demand

Alongside swap rates, supply and demand is another factor that can cause mortgage rates not to drop if the base rate is cut. It may seem advantageous for one lender to offer a lower rate than their competition. However, if a rate is too competitive following a rise in swap rates, they may become overrun with new business enquiries and unable to cope with the demand.

In this instance, we may see some lenders decide to follow the herd and reprice their products, bringing them closer in line with their competition.

Separately, it is important to note that lenders have many internal factors that will decide whether they raise or reduce mortgage rates. This can include their own lending targets and future pipeline, competitor pricing and overall service levels, irrespective of swap rates or the bank base rate.

Get advice today

Understanding the factors that can contribute to mortgage pricing can be important in helping you make the right decision. While this can be confusing, with lots of factors contributing to the rates on offer, mortgage and protection advisers can offer plenty of knowledge, support and access to lots of lenders for those looking to navigate the market.

Whether you’re looking to apply for a mortgage, you are soon due to remortgage or you are just looking for some advice, we can help you find the right solution.

To book your appointment, please call Gem Financial Services on 01980 670403 or email admin@gem-fs.co.uk.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Approved by The Openwork Partnership on 27/11/2024.

Saving for your child's university education

Saving for your child’s university education requires careful planning and budgeting. By starting early, considering investment opportunities, encouraging your child to save, looking for scholarships and bursaries, and planning, you can make saving for university a manageable goal and give your child the best possible start in life.

What is the average cost of university?

The annual cost of an undergraduate degree is £9,250 for most students in the UK. However, in England this figure is due to increase to £9,535 as of September 2025.

As well as a tuition fee loan, students can get a maintenance loan to help cover living costs like accommodation, travel, food, and books. The maximum maintenance loan is approximately £10,227 a year. Although, this will be increasing to £10,544 in September 2025. This will more than likely be a significant shortfall that parents will need to cover. However, the exact cost of university can vary depending on where your child studies and the course they choose.

It’s important to consider the following when saving for your child’s university education.

Start early

How you save for your child’s university costs will depend on how long you’ve got before the money will be needed. For example, if your child is due to start university in the next few years, sticking with cash savings is likely to be your best option so the money is readily available and there’s no investment risk.

Consider Investing

Investing some of your savings can help you achieve higher returns, but it also comes with higher risks. It's important to understand what investment options you have before making any decisions. These options include:

• Stocks and Shares ISA – A tax-efficient investment account that can help make your money work harder. Unlike a cash ISA, a stocks and shares ISA gives your money more potential to grow by investing it in a range of places like shares, funds, investment trusts and bonds, instead of keeping it in cash.
• Junior ISA – Junior ISAs have a tax-free allowance of £9,000 per tax year, which can be invested in cash, stocks and shares, or a combination of both. The funds in a Junior ISA are locked in until the child reaches the age of 18, at which point the account will convert to a standard adult ISA.

Encourage your child to save

Teaching your child about the importance of saving and encouraging them to save for their own education can help reduce the financial burden on you. Encourage them to take on part-time work and save some of their earnings towards their university education. They can use the following to help them save:

• Regular Savings Accounts - Many banks and building societies offer savings accounts for you to set up on a child’s behalf. Regular savings accounts are designed to encourage children to save an amount every month, and often run for a set amount of time.
• Instant Access Savings Account – Instant access savings accounts allows you or your child to withdraw or deposit money at any time.

Scholarships, Grants and Bursaries

Each university offers their own scholarship, grant and bursary programmes to help students pay for their education. Different universities offer different financial aids, so it is worth doing your research beforehand. Your child may be eligible for financial support based on academic or sporting achievements.

Plan Ahead

Creating a financial plan and setting goals can help you stay on track and make saving for your child's university education more achievable. Work out how much you need to save, how much you can realistically contribute each month, and how long it will take to reach your goal.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Approved by The Openwork Partnership on 22/11/2024

As a parent, providing for your children is a top priority – from making sure they have food on the table, to ensuring they have the extras they need in life.

Putting income protection in place means you’ll always be able to support your children with a regular income if the unthinkable should happen and you’re unable to work because of serious illness or injury.

Keeping your family financially healthy.

2024 research from LV shows that the average UK worker’s income supports three people, yet 65% of the working population have experienced a life event where protection might have provided support¹

As a parent, your children depend on you financially. But should you become ill or injured and unable to work, would your family be able to manage without your income?

Would your family be able to cover all the essential monthly outgoings – not to mention the extras you’re used to having?

In a two-parent family, even with a safety-net of sick pay and savings, you might struggle to keep up with your regular outgoings on one income, especially if you’re not well enough to go back to work for a substantial amount of time.

Financial struggle for your family is the last thing you need when you’re trying to recover from a medical condition.

Are you a one-income family?

It’s also worth bearing in mind that becoming a parent may mean you now only have one income if one parent is staying at home for childcare purposes. Protecting this main source of income is essential, as is the case with one-parent families. With the rising cost of childcare and bills, the need to protect your family against financial difficulty is more important than ever.

Income protection can give you the support you need, when you need it most.

By protecting your family this way, you can get help with mortgage payments, bills and food, as well as clothes, transport and leisure – protecting not just your essential outgoings, but your family’s lifestyle too. Putting income protection in place alleviates the risk of financial instability by providing your family with a regular source of income, so you have the peace of mind that your children will be provided for until you get better.

Find out what works for you with an adviser from Gem Financial Services

Income protection can be discussed with your adviser – so you can make sure you have the right protection in place to protect you and your family’s financial future.

Call Gem Financial Services on 01980 670403 or email admin@gem-fs.co.uk.

Approved by The Openwork Partnership on 20/01/25.

Why plan ahead of your fixed rate ending?

 The earlier you plan your remortgage, the more mortgage options you have! And in the current economic climate, it really does pay to know your options. An expert adviser can find the deal for you.

 If you’re due to remortgage in the next year or so, take a look at our handy list of does and don’ts that will help you plan ahead with confidence.

 -         DO give yourself time to weigh up your options. Leaving anything to the last minute can be incredibly stressful – even more so when it’s something as important as your mortgage! Take a weight off your shoulders and give yourself plenty of time to look at what’s available – it’s worth speaking to an adviser so you can get the ball rolling.

 -         DON’T accept the first deal you find. Keep an open mind, it can be very tempting to snap up the first mortgage you see that looks good. But there are so many different mortgages out there – some of which you might not even have considered! We’d recommend getting the help of an expert adviser to help you find the right deal. Which brings us to…

 -         DO seek the help of a mortgage adviser to help with the search and application process. There are so many mortgage options on the market, it can feel a bit overwhelming. With the help of an expert adviser, you can choose with confidence. We’ll help you through the whole remortgage process – from choosing a good fit, to going through the small print and completing the process. Plus, we’ll save you time spent searching, as well as mortgage comparison headaches.

-         DON’T assume you have to stay locked in a deal before you remortgage. If you secure your rate early and then find an option that suits you better, you can change your mind and go for the new deal.The vast majority of lenders won’t lock you into a deal before your expiry date, which gives you the best of both worlds. If rates rise after you’ve chosen a deal, you will have secured a competitive mortgage and should hold onto it throughout the mortgage application process. If rates reduce, your adviser will inform you and simply switch to a lower rate before you complete. Either way, you can sit back and relax, knowing we’ll have you covered.

 -         Do think long term. Early Repayment Charges (ERC) apply when you want to repay your mortgage early or pay your overpayment allowance. In some cases, paying the ERC (at 1% or 5%) and securing a new rate straight away might actually save you money in the future. This is because you won’t be waiting until rates have increased, which could affect your next mortgage product.

 -         Don’t default! If your current mortgage expires and you haven’t got another option in place, you’ll automatically roll onto your lender’s default rate – often at a higher standard variable rate. Avoid spending money where you don’t need to, and make sure you get in touch with a mortgage adviser. We can help you get another mortgage option in place when your current one expires.

 Get a head-start on the remortgaging process with an adviser from Gem FS Ltd

Whatever stage you’re at in the remortgaging process, a mortgage adviser can expertly guide you on your way. We’ll compare a huge range of lenders and mortgages on your behalf, finding a solution that’s completely tailored to your needs.

Ready to plan your next remortgaging steps? Speak to an expert adviser today.

Call Gem FS Ltd on 01980 670403 or email on admin@gem-fs.co.uk

Approved by The Openwork Partnership on 15/01/2025

What should my priorities be?

In 2025/2026, you can contribute a maximum of £20,000 across all your ISAs. This allowance applies to Cash ISAs, Stocks and Shares ISAs, Lifetime ISAs, and Innovative Finance ISAs. By investing in these, you won't pay income tax on the returns. Remember, you cannot roll over unused allowances into the next tax year.

Quick wins

There are cash efficiencies available to you if you know where to look. Consider the Lifetime Cash ISA as an example. It’s an excellent way to maximise allowances and bonuses and can be opened by anyone under the age of 40. By contributing up to £4,000 each tax year, the government provides savers with a 25% bonus, worth £1,000 annually.

A Lifetime ISA can only be used for saving towards either your first home (costing up to £450,000) or for retirement. If you withdraw some or all the cash before the age of 60 or don't use it for a first home or retirement, you will incur a 25% penalty on the withdrawal amount, effectively losing the government bonus.

Utilise your pension

Are you a higher-rate or additional-rate taxpayer? If so, you can claim the full amount of pension tax relief, which could be an additional 20% or 25%.

It’s in your hands

Whatever unfolds in the next tax year, remember that your financial decisions are in your hands - and ours. For tailored support in helping you reach your financial goals, please contact a financial advisor.

An ISA is a medium- to long-term investment that aims to increase the value of your invested money for growth, income, or both.

The value of your investments and any income from them can fall as well as rise. You may not get back the amount you invested.

HM Revenue and Customs practices and the laws relating to taxation are complex and subject to individual circumstances and changes that cannot be foreseen.

Approved by The Openwork Partnership on 19/03/2025.

If you’ve worked for more than one employer, you will doubtless have more than one pension plan. How long is it since you last looked at them? Are they languishing in poor performing funds?

Combining some or all of your pensions into a single plan could save you money, achieve better growth and make your life easier. Here are some things to consider:

5 benefits of pension consolidation:

1. Consolidating could save you money. Each pension plan has its own annual charges so combining multiple pensions into one means you’ll only pay one annual fee. Shopping around could also help you find a plan with lower charges than your current ones.

2. It gives you greater flexibility. Modern pensions may offer benefits that older ones don’t, like flexible drawdown of your pot or income for your loved ones after you pass away.

3. It keeps things simple. You only have to remember one set of login credentials and, if your address changes or you want to change the recipient of any death benefits, you only have to tell one provider.

4. You could get better opportunities. Bringing your pensions together could increase the overall value of your savings and a different plan or provider might give you access to a wider range of investment funds.

5. It makes it easier to plan for the future. An important part of retirement planning is understanding what you’ve got and what you’ll need. Having everything in one place makes it easier to track your plan’s value against your goals.

Things to be aware of

You could be charged exit fees. Some plans still have exit penalties so make sure you’re aware of these and the impact they might have on your pot.

It may be better to stay in a final salary (also known as defined benefit) scheme. These offer a guaranteed income in retirement alongside other benefits (like a pension for your spouse when you die) which you’ll lose if you transfer out.

There’s no guarantee you’ll be better off consolidating. Your current pensions may have benefits like early access or guaranteed annuity rates that might be worth keeping, and annual fees on other pensions may not be competitive.

Get advice before you consolidate

We’re here to help. We can assess your situation, explore your options, and help you understand if pension consolidation is right for you.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

Approved by The Openwork Partnership on 26/09/2024

Why the Autumn Budget matters (to you, your money and your future)

Budgets often bring changes to taxes, benefits and financial rules that affect everyday savers, homeowners, investors and business owners. The UK government will deliver its Autumn Budget on 26th November 2025, and speculation is strong this year. Getting advice now could help you protect your money and make informed decisions.

What are people expecting?

Some of the major areas where commentators are speculating changes include:

How could our advice help you navigate these changes?

There are some real risks if you wait or act on rumours alone. We can help you:

1. Meet deadlines or allowances: Many tax allowances (ISA, CGT exemptions, pension annual allowances) are fixed and once used or expired you can’t get them back. If you don’t know what’s changing and when, you could lose out.
2. Plan your actions: For example, selling assets now vs waiting until after the Budget could mean paying more tax. Or moving money into or out of a tax wrapper without knowing whether the relief will be kept, reduced or removed means you could miss out down the line.
3. Make use of allowances: You may be able to structure gifts, inheritance planning, pension contributions or other forms of tax planning better, but only with knowledge and foresight.
4. Anticipate changes: If you own property, assets or rental income, changes like national insurance on rental income or taxing wealth or assets currently exempt could catch people by surprise.
5. Take your time: Rumours and speculation can provoke rushed decisions (for example selling off investments, withdrawing pension lump sums) which may not align with long-term goals.

What financial advice can do for you now

Engaging with a trusted financial adviser now, ahead of 26 November can make a real difference:

• Tailored review of your financial picture: We can look at your income, savings, property, investments, tax allowances and liabilities. We can model scenarios against possible changes to see what’s likely to hurt or help you most.
• Action plan for tax efficiency: Whether that means making use of current allowances (ISAs, pensions), shifting assets into better-taxed wrappers, or accelerating transactions that make sense.
• Inheritance & wealth planning: If wealth taxes or inheritance tax rules change, preparing earlier (gifts, trusts, estate plans) can reduce the shock and cost.
• Mitigating downside risk: You might not be able to stop a tax increase, but you can reduce exposure. For example, rebalancing investments, delaying or bringing forward certain transactions, or adjusting your business structure if you run your own business.
• Clarity and confidence: Having a professional explain what might happen helps you make decisions calmly rather than reacting under pressure.

Why working with us makes a difference

We believe good advice now is not just nice to have, it’s essential. We’re here to help you:

• Understand the rumours and speculation for what they are, not let them panic you.
• Model likely Budget outcomes, helping you see what works best in your situation.
• Support you to act in a timely way so you can retain as much advantage as possible.
• Keep you updated, clear and confident every step of the way.

Our optimism for the future

Even though Budget changes can feel uncertain or stressful, they also carry opportunity. Smart planning now can protect more of what you’ve earned, help you pass on more to those you care about, and set up your finances to thrive in whatever new rules come in.

If you’d like us to run you through what the latest speculations could mean for you, let’s schedule a call. We’ll work together to map out a plan before the Budget so that you’re ready whatever the outcome.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

For specialist tax advice, please refer to an accountant or tax specialist.

Gem FS Ltd is an Appointed Representative of The Openwork Partnership, a trading style of Openwork Limited, which is authorised and regulated by the Financial Conduct Authority.

Approved by The Openwork Partnership 30/09/2025

It’s fair to say that the Autumn Budget 2025 has been anxiously anticipated by British taxpayers and businesses alike, with a large amount of media coverage prior concerned with the Labour government’s reported "fiscal black hole.” This debt is estimated to stand between the range of £20bn to £40bn, and Reeves was predicted by experts to implement a combination of tax increases and spending reductions to meet targets.

Reeves' last announcement, the 2025 Spring Statement, included several key initiatives to level up Britain's defence, address the housing crisis, and reform the UK’s welfare and benefits system. But with national inflation still running above the Bank of England's 2% target, and the wider UK economy showing subdued growth, the Chancellor took tough measures to raise the necessary revenue without breaking her prior pledge to increase key taxes.

So, ultimately, who wins and loses? This article will outline which groups could be most affected by the announced changes to economic legislation. Read on to learn more.

The Winners

The National Health Service

Reeves stated that she intends on reinvesting money saved from cutting back on public sector inefficiencies into the NHS, pouring 300 million pounds of investment in technology to improve patient service.

The Chancellor also stated that she intends on building 250 new neighbourhood health centres, and expanding more services into communities such as Birmingham, Truro and Southall. All this is intended to reduce high NHS waiting times and improve access to care.

Low Income Workers

Reeves also announced that the national living wage will increase by 4.1% to £12.71 for workers aged 21+. The Chancellor claims this will increase gross annual earnings of a full-time worker on the rate by £900. Further, Reeves announced that the national minimum wage rate for 18-20-year-olds will increase by 8.5% to £10.85 an hour.

Parents

The Chancellor announced that she would scrap George Osbourne’s controversial two-child benefits cap. Previously, this 2017 Conservative legislation prevented the parents of more than two children from claiming universal credit for subsequent children. However, Reeves is committed to expanding this welfare to other families in need. According to the aforementioned OBR report, this measure is set to increase the benefits for approximately 560,000 families by an average of £5,310.

The Defence Industry

In response to increased aggression from Russia, as well as a perceived lack of commitment from the Trump administration to European defence, Reeves also promised to increase investment in Britain’s military. The Chancellor confirmed that the UK is set to spend 2.6% of GDP on its defence by April 2027. Reeves stated: “In our age of insecurity, Britain will continue to stand with our allies, working in collaboration to secure a sustainable ceasefire for Ukraine and maintaining our commitment to NATO.”

The Education Sector

In a bid to improve the services of public education, the Chancellor announced her commitment to providing £5 million for libraries in secondary schools, and a further £18m for improving and upgrading school playgrounds across the UK. Reeves stated: “Let there be no doubt that this is a government that is on the side of our kids and who will back their potential. I will not allow the legacies of Conservative neglect to stain our society.”

Homeowners

Taking further action to address the ongoing cost-of-living crisis, as well as costly energy bills for British households, Reeves also pledged to scrap the Eco energy scheme from April 2026, which will allegedly £150 from the average household energy bill.

The Chancellor then claimed that the Labour government will also continue to provide support packages for household energy costs. These will include alterations to green levies on electricity. Reeves stated: “The cause of high energy bills must be tackled at source, and so we are investing in energy security – in nuclear and renewable energy – and in insulation through the Warm Homes Plan.”

Non-EV Drivers

The Chancellor has confirmed that her tax rises are to be partially offset by a freeze to fuel duty for a further five months until September 2026 meaning that drivers will not be forced to pay more for petrol in the short-term. However, she confirmed that there would be a staged increase to fuel-duty in line with inflation from mid-2026.

The Losers

The Hospitality Industry

The Chancellor also announced that the government is set to introduce "permanently lower tax rates" for more than 750,000 retail, hospitality and leisure properties, significantly aiding store owners, as well as landlords and owners of holiday rental properties, hotels, B&Bs, and hostels. However, Reeves also stated that local mayors will still be granted powers to impose a so-called ‘tourist tax’ on overnight stays, which may have an impact on the tourism sector.

Entrepreneurs and Business Owners

Reeves announced that she would also raise the basic and higher rate of tax on dividends by 2%, which could have the knock-on effect of discouraging entrepreneurs and investors from launching and funding business in the UK.

Basic taxpayers currently pay 8.75 per cent on dividends, while higher rate taxpayers pay 33.75%. This move may affect investors, who might want their shares to pay out in dividends, or CEOs and business owners, who often pay themselves via dividends rather than a fixed salary.

Electric Vehicle Owners

Unfortunately, not all drivers will benefit from the budget announcement. The Chancellor made clear that there will be new tax for electric and hybrid vehicles. Drivers of E-vehicles will pay a road charge of 3p per mile, while plug-in hybrid drivers will pay 1.5p per mile from April 2028.

In addition, these rates are set to rise each year with inflation, which may discourage automobile manufacturers currently operating in the UK. Again, per the OBR report, this new charge is predicted to bring in £1.1 billion in the 2028-29 financial year, rising to £1.9 billion by 2030-31.

High Value Property Owners

Reeves has also confirmed that the Labour government will be pushing on with their so-called ‘mansion tax’ in England; set to target high value property owners. The Chancellor stated that this tax would cost £2,500 for properties worth more than £2 million, and £7,500 for properties worth more than £5 million, alongside their council tax. Reeves claimed that this new surcharge would raise over £400 million by 2031; charged on the top 1% of properties.

Gambling and Gaming Industry

Reeves has announced that the gambling industry is due to be taxed more heavily in the near future, with the aim of raising more than £1 billion in revenue by 2031. In particular, the Chancellor took aim at online gambling and betting apps; increasing the remote gaming duty from 21% to 40%, and the duty on online betting from 15% to 25%. However, Reeves made no changes to in-person gambling or horse-racing, while the bingo Duty is set to be abolished from April 2026.

What’s next?

In addition to the above, Reeves also announced that pension contributions made under salary sacrifice schemes of more than £2,000 per year will have to make national insurance contributions from 2029, for both employers and employees.

Of course, only time will tell whether the Chancellor’s actions will back up her words. Nevertheless, it’s clear that this budget will have a profound effect upon the people and enterprises living and working in Britain. So, if you’d like more information on how the measures mentioned in the statement could affect your finances, don't hesitate to get in touch now.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.

Approved by The Openwork Partnership on 27/11/2025