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Slides mid life

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Financial Advisor presentation on personal finance

Financial Advisor presentation on personal finance

Published in: Economy & Finance

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  • 1. Financial Planning in the Workplace Presentation by …
  • 2.
    • Money Management & Budgeting
    • Looking at your income and outgoings
    • Monthly expenditure – mortgages, loans and debts
    • Other concerns
    • Reviewing your Pension
    • Topping up
    • Alternatives to topping up
    • Protection Issues
    • Critical Illness
    • Life Assurance
    • A combination of the two
    Agenda
  • 3.
    • Taxation Issues
    • Personal allowances
    • Taxable Income
    • Inheritance Tax planning
    • Why you need a Will
    • Regular Savings & Investments
    • Your aims and objectives
    • Capital growth v income
    • Your attitude towards risk and the Honister profile
    • Real returns from Banks and Building Societies
    • Your Investment Options
    • The Way Forward
    Agenda continued…
  • 4. One of the UK’s foremost financial commentators
  • 5. Money Management
  • 6.
    • Review all your regular outgoings
    • Review mortgage, savings and protection
    • Consider repaying loans / credit cards
    • Re-appraise your long term pension planning
    Your guide to your outgoings Money Management
  • 7. When did you last review? Mortgage £?? Per month Loan / Credit Card £?? Per month Savings (Bank) £?? Per month Life Assurance / Critical Illness £?? Per month Savings (Endowment) £?? Per month
  • 8.
    • Fixed and Capped Rates
    • Flexible/Offset Mortgages
    • Tracker Rates
    • Discounted Rates
    Your home may be repossessed if you do not keep up repayments on your mortgage The Mortgage ‘Minefield’
  • 9.
    • Loans tend to be shorter term 3 – 5 years
    • Credit cards can be expensive
    • Check high APR
    • Check surrender/penalties on loan
    Your guide to loans and debts Money Management
  • 10.
    • Savings to Bank
    • Mortgage Endowment – It may be best to see it through to maturity
    • Life Assurance, critical illness protection - have you had this reviewed?
    “ To find out more about any of these issues, please tick the coloured priority form” Your guide to savings Money Management
  • 11.
    • Additional Voluntary Contributions
    • Can be In House or Provided by Outside Institution (FSAVC)
    • Advantages
    • Tax Efficient (immediate tax relief at highest marginal rate)
    • Growth Potential
    • Additional Pension Income and Pension Commencement Lump Sum (PCLS)
    Topping up your Pension
  • 12.
    • Tax Relief on Contributions
    • Lump sum payments and possibly regular contributions
    • Increased Pension (and possibly PCLS)
    • Can be expensive especially at older ages
    Buying added years Topping up your Pension
  • 13.
    • Open to everyone even if they do not work
    • Can invest £3,600 p.a. gross per tax year without evidence of earnings
    • Tax Relief on Contributions (at highest marginal rate of income tax) up to “Annual Allowance” (£50,000 for 2011/12)
    Personal/Stakeholder pensions Topping up your Pension
  • 14.
    • Pension Commencement Lump Sum of up to 25% of Pension Fund
    • Anytime between 55 years of age and 75.
    • A Lifetime Annuity must be taken by age 75 or go into Alternatively Secured Pension (ASP)
    • Choice of Providers
    Personal/Stakeholder pensions continued… Topping up your Pension
  • 15.
    • Flexible – contributions can be increased or decreased
    • Proceeds can be taken at any time as a lump sum
    • No Tax Relief on Contributions
    Regular savings Alternative to topping up your pension
  • 16.
    • Family Income Benefit
    • Term Assurance
    • Pension Term Assurance (no tax relief on premiums now)
    • Whole of Life
    • Endowment
    • Increase Death in Service
    Protection
  • 17. 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 £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
  • 18. 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 £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
  • 19. 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 Protection £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
  • 20. Your Guide to Taxation
  • 21. Your Guide to Taxation “ I believe we should all pay our taxes with a smile – I tried, but they wanted cash!” - Anon
  • 22. Your personal allowance is the amount you can earn each year before paying any tax. Tax is then payable as follows: £0 - £35,000 20% £35,001 - £150,000 40% Over £150,000 50% Inheritance Tax based on tax year 10/11
  • 23. Tax on Capital Assets on Death Inheritance Tax
  • 24.
    • Tax on capital assets on death
    • First £325,000 of estate - 0% tax
    • Balance of estate - 40% tax
    Inheritance Tax based on tax year 11/12
  • 25. Transfers between Spouses Exemptions First £3,000 each year – annual exemption Small gifts under £250 Marriage - £5,000 To Children £2,500 To Grandchildren £1,000 Other Gift out of income Personal exemption nil rate band £325,000 Inheritance Tax based on tax year 11/12
  • 26.
    • Must be paid before probate release estate
    • May mean bridging loans
    Inheritance Tax – Your Concerns
  • 27.
    • Using Will trusts to reduce the tax bill
    • Retaining control over assets
    • Will Trust only start after your death
    • Ensure the last survivor has sufficient assets
    • Plan your Will and investments together
    Inheritance Tax - Mitigation
  • 28. Your Guide to Wills and Estate Planning
  • 29.
    • Specialist financial advice needed to ensure your estate is equalised so that each can use nil rate bands.
    • Possibly need to review life assurance and place in trust
    • Need to look at death in service benefits and rules in connection with their payment
    • Need to look at the value of your home and ensure that it is split 50/50. This may require severance of tenancy options
    Why would I need a Financial Adviser?
  • 30.
    • To ensure your wishes are carried out after your death
    • To ensure the right people get the right assets
    • To speed up the transfer of assets (via Probate)
    • To reduce Inheritance Tax through Will Trusts
    Why make a Will?
  • 31.
    • Laws of Intestacy – the State determines who gets your estate
    • Loss of absolute control over your assets
    • Unmarried partners may suffer financially
    • Long delays in transferring
    • £250,000 to spouse plus a life interest in 50% of residue
    • The remaining 50% interest for children (in trust under 18)
    What happens without a Will?
  • 32.
    • Review it regularly
    • Marriage will annul a Will
    • Divorce will affect a Will
    • Have you appointed Guardians?
    • Do you have stepchildren?
    • Is your Will tax-efficient?
    Existing Will
  • 33.
    • Lasting Powers of Attorney
    • Trustees must take financial advice
    • Where to keep your Will
    Other Legal Matters
  • 34.
    • Long term care may use up your assets
    • Use a Will Trust to protect your house
    • Severing your house tenancy
    • Take action early
    • .……..Complex rules – specialist advice essential
    “ To find out more about any of these issues, please tick the coloured priority form” Long Term Care – protecting your assets
  • 35. Your Guide to Investment
  • 36. Developing a Balanced Strategy
    • Interest earning deposits
    • Bank/Building Society/National Savings
    • Fixed-interest securities
    • Corporate Bonds/Gilts
    • Asset-backed investments
    • Shares and Share-based Funds/Property
  • 37. Your Guide to Investment
    • Interest Earning Investments
    • Where are the best accounts?
    • Fixed-Interest Securities
    • What are Gilts &
    • Corporate Bonds?
    • Asset Backed Investments
    • What choices are there?
    • Managed Distribution Bonds
    • Stocks/Shares
    • Unit Trusts/OEICs
    Property Funds
  • 38.
    • Bank and Building Society Accounts
    • Internet
    • National Savings
    Interest Earning Investments
  • 39. Fixed Interest Investments
    • Gilts
    • Government Stock
    • Corporate Bonds
    • IOUs issued by companies
  • 40.
    • Low/medium risk sector - With Profit, Property*
    • Distribution Bonds*
    • Medium risk investors - Managed Funds*
    • Adventurous investors - a variety of specific funds
    • * Property funds may refuse to switch or encash investments for up to twelve months, as property in the fund may not always be readily saleable. The value of property is a matter of valuer’s opinion rather than fact.
    Suitable for a wide range of investors Investment Bonds
  • 41.
    • Broad exposure
    • Basket of investment
    • Professional management
    • Income or growth
    • Geographic diversification
    Help to spread the risk Unit Trusts / OEICs/ ISAs -
  • 42. £5,000 invested for 10 years – Invesco Perpetual Income, with NET income re-invested Your Guide to Investment 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.
  • 43.
    • Complete and hand in the Priority Coupon
    • Book a one-to-one consultation
    • Contact marketingservices@honistercapital.com
    • Call us on 0845 013 5600
    • We wish you good luck!!
    What do you do now? The way forward…
  • 44. Thank You
  • 45. 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. Honister Partners 62 Anchorange Road Sutton Coldfield West Midlands B74 2PG Telephone: 0845 013 5600 Facsimile: 0121 362 1010 Website: www.honisterpartners.com