Information from a financial perspective for those who are being made or have already been made redundant. Actions they can take and the Options they have

1. Presentation by … Redundancy Planning

3. One of the UK’s foremost financial commentators

4. Income? Growth? Family Protection? Taxation? Advice? Investments? Inflation? Pension Shortfall? Long Term Care? Quality of life? Costs? Inheritance Tax? Your Concerns

5. Money Management

7. Question: How to cope with these outgoings? What course of action? Mortgage Approximately £250 per month Loan / Credit Card Approximately £80 per month Savings (Bank) Approximately £150 per month Savings (Endowment) Approximately £50 per month

9. Job seeker allowance may be available 6 – 12 Months Mortgage Payments 6 – 12 Months Living Expenses Could be funded from redundancy capital until new employment or replacement income is sourced 0 – 6 Months Plan

16. Severance payments over £30,000 Amounts over £30,000 = taxable income Buy extra pension? Or Pay tax and keep capital? Pension Issues – Your Pension Checklist

25. £14.80 £17.50 £8.50 £10.50 £6.00 £7.30 £5.35 £6.67 Female aged 20 Male aged 30 Female aged 30 Male aged 40 Female aged 40 Male aged 50 Female aged 50 Male aged 20 Life Protection only Sum assured £100,000 – Level term benefit/level premium/ guaranteed rates. Quote based on non-smoker; cover to age 60 Protection Source: Assureweb April 2010

26. £38.40 Female aged 20 £29.50 Male aged 30 £29.60 Female aged 30 £46.60 Male aged 40 £44.60 Female aged 40 £82.20 Male aged 50 £75.50 £36.00 Female aged 50 Male aged 20 Sum assured £100,000 – Level term benefit/level premium/ guaranteed rates. Quote based on non-smoker own occupation; cover to age 60 Critical Illness only Protection Source: Assureweb April 2010

27. Sum assured £100,000 – Level term benefit/level premium/ guaranteed rates. Quote based on non-smoker own occupation; cover to age 60 Source: Assureweb April 2010 Life Protection / Critical Illness combined £17.89 Female aged 20 £28.88 Male aged 30 £28.98 Female aged 30 £45.64 Male aged 40 £43.77 Female aged 40 £80.06 Male aged 50 £73.97 £20.12 Female aged 50 Male aged 20 Protection

28. Your Guide to Taxation

29. “ I believe we should all pay our taxes with a smile – I tried, but they wanted cash!” - Anon Your Guide to Taxation

30. Personal Allowances based on tax year 2010/11 Your Guide to Taxation *From the 2010-11 tax year the Personal Allowance reduces where the income is above £100, 000 – by £1 for every £2 of income above the £100,000 limit. This reduction applies irrespective of age. Under 65 £7,475 65-74 £9,490 75 £10,090

31. Tax on Capital Assets on Death Inheritance Tax

33. Your Guide to Estate Planning What are you taxed on? 40% Is it a voluntary tax? What is the current rate of tax? What is the Nil Rate Band? Worldwide Assets £325,000 Some would say YES! Levels and bases of, and reliefs from taxation are subject to change

35. Gifts to spouse Main Exemptions First £3,000 each year – annual exemption “ Normal expenditure” Potentially Exempt Transfers (PETs) Inheritance Tax - based on tax year 11/12

41. On death Mr Smith passes all of his estate (plus jointly owned assets) to his wife free from IHT. However, this wastes 100% of his Nil Rate Band. Nil Rate Band £325,000 (this amount has been frozen until 2015) Mrs Smith total Sole Estate = £650,000 Mr & Mrs Smith’s total joint Estate £650,000. A transferable Nil Rate Band now arises when one party to a marriage/civil partnership dies and the amount of their estate chargeable to IHT does not use up all of the Nil Rate Band. Where this happens, the unused part can now be transferred to the surviving spouse/civil partner when they die. Assuming Mrs Smith dies after 9 October 2007, her executors may also utilise the late Mr Smith’s Nil Rate Band which he wasted by leaving everything to his widow. Less 2 x Nil Rate Bands = £650,000 Taxable Estate = £0 Alleviation for Middle England

42. Mr Smith’s Estate £325,000 Mrs Smith’s Estate £325,000 Mr Smith leaves the £325,000 in a Discretionary Will Trust. Total Estate = £325,000 TAX DUE @ 40% NIL Taxable Estate = Nil Nil Rate Band £325,000 (As of April 2010) Levels and bases of, and reliefs from taxation are subject to change. If the potential growth in value of an asset is likely to outstrip future increases in the Nil Rate Band, tax planned Wills on first death leaving an amount up to £325,000 [2010/11] to a trust should still be considered. Inheritance Tax Solution TAX DUE @ 40% = NIL Year 2010 value of trust - £390,000 (available NRB - £325,000 had asset passed to surviving spouse on first death.)

43. Levels and bases of, and reliefs from taxation are subject to change IHT savings may still be made via tax planned wills in the medium/long term even where the combined estate is <=£650,000. Couples with existing Pre-Budget wills should revisit them. A simple codicil may suffice for required changes. The ideal solution may be to always use a first death discretionary nil rate band trust and let the trustees decide the right action to take when death occurs. Outcome

44. Your Guide to Wills and Estate Planning

51. Is Inflation still a threat? Inflation rates displayed are for illustration purposes only and should not be viewed as proposed past or future inflation values. Figures are based on the value of £1,000 189 358 544 20 434 599 738 10 659 774 858 5 920 950 970 1 8% 5% 3% Annual Rate of Inflation Years Ahead

52. Guide to ‘Goods and Services’ Source: Office for National Statistics - ‘Focus on CPI February 2010’ Prices: 1980 vs Today * Average beer prices not recorded prior to this date Average Price 1980’s Average Price Feb 10 Increase Source Pint of Lager 83p £2.89 248% ONS 1987* Pint of Milk 17p 44p 159% ONS Litre of Petrol 38.46p £1.12 191% ONS Loaf of Bread 30p £1.21 303% ONS

53. Guide to Commodity Prices Source: Office of National Statistics website April 10 RPI July 1985 March 2010 Increase 95.23 217.09 128%

54. Your Guide to Investment

62. Bates Scale – Investment Risk High Low

64. £5,000 invested for 10 years – Invesco Perpetual Income, with NET income re-invested Past performance will not necessarily be repeated in the future. Capital held in a deposit account is guaranteed not to fall in value, whereas the value of units and income from an equity- based investment can fall as well as rise and is not guaranteed. Equity based investments should be considered as medium to long term investments, therefore if you withdraw in the early years you may not get back your original investment. Your Guide to Investment

65. Security for your capital Income at a level which maintains your standard of living Capital Growth because inflation is still a threat Flexibility to meet changing circumstances Obtain Independent Advice Summary

67. Thank You

68. Honister Partners 62 Anchorange Road Sutton Coldfield West Midlands B74 2PG Telephone: 0845 013 5600 Facsimile: 0121 362 1010 Website: www.honisterpartners.com Honister Partners Ltd is an appointed representative of Sage Financial Services Ltd. The Financial Services Authority does not regulate taxation advice or will writing. Past performance is not a guide to future performance. The information given is based on our current understanding of Law and Inland Revenue practice. Tax rates and reliefs may change and their value depends on the individual circumstances of the investor. The information provided in this presentation has been provided as information only and does not represent individual advice. It is unrealistic to assume that markets/funds or indexes will perform as they have done in the past. Honister Partners offer advice based on the whole of the market.