Month: December 2022

Top 5 excuses for not having a will…

If you don’t have a will in place, it could be because you’ve just not got round to it yet.

But you’d be surprised at how many people actively choose not to write a will, often for quite flimsy and questionable reasons.

So we wanted to highlight some of the most common excuses for not writing a will and debunk them one by one.

I’m too young
Many people see a will as something they’ll only need in later life, perhaps when they’re thinking about how much money they want to leave to their children and grandchildren.

Of course, many of us will hope we’ll live to a ripe old age, but none of us can be 100 per cent sure of that, so it certainly pays to have your affairs in order, and have control over where your money goes if the worst happens.

There’s also no age limit on having a will, so there’s nothing stopping you getting one as soon as you turn 18, when you might be in work, earning money, accruing wealth and starting a family.

I’m not wealthy enough
The amount of money you have doesn’t matter, as there is no minimum or maximum threshold you must meet to be able to write a will.

It might also be the case that you have more than you think. For example, given the scale of house price increases in recent years, your property might be worth a good deal more than you think, as could its contents.

It’s too complex
Working out what to do with your inheritance can be complicated, particularly if you’re worried about the tax implications, and we understand that.

However, there is plenty of support out there. A professional, regulated financial adviser can offer guidance and talk you through all the options open to you.

With the right help and support, you can be confident that your estate will be set up in a way that you understand and that maximises the amount available to leave behind to your loved ones.

Everything will automatically go to my partner
That’s not the case if you’re not married. If you die without a will, the Rules of Intestacy state that your inheritance must go to your closest living blood relatives.

So even if you’ve been cohabiting with a partner for many years and have children together, the children would be first in line to receive your inheritance. Your partner, meanwhile, wouldn’t have any automatic right to inherit anything at all, which could be quite distressing for them.

I don’t like thinking about dying
Confronting our mortality can be difficult, and death has always been something of a taboo subject.

With that in mind, it’s perhaps no surprise that people don’t want to make plans for when the worst happens, or at the very least, decide to put it off.

But we are all mortal, so if we have people who love us and depend on us, we can do them a huge favour by getting our affairs in order. Not only does it make the process of dealing with your estate much easier after your death, it also reduces the chances of any family disputes arising, at a time when emotions will already be running high.

If you have any questions about estate management and writing a will, please feel free to get in touch with us, and we’ll be happy to help.

What is the state pension triple lock?

The Chancellor’s decision to protect the state pension triple lock was one of the most headline-grabbing aspects of the recent Budget.

But what exactly is the triple lock and what does it mean?

In short, it’s a mechanism designed to make sure the state pension doesn’t lose value, so it will go up by whichever is highest of the following measures:

Average earnings
The rate of inflation (as per the Consumer Price Index)
2.5 per cent
So if, for example, average earnings went up by three per cent, the state pension would go up this amount, provided the rate of inflation was also lower than this amount.

Or if average earnings went up by two per cent and inflation increased by three per cent in the same year, the state pension would go up by the latter amount.

The Chancellor’s pledge to protect the state pension triple lock was therefore very significant in light of the current cost of living crisis and inflation being at a 40-year high.

With this guarantee in place, pensioners are in a stronger position to withstand the tough economic climate and make ends meet at a time when so many people are really feeling the pinch.

However, it should be noted that Jeremy Hunt didn’t commit to saying how long the measure would remain in place.

This is a costly policy for the government at a time when it wants to spend public money more efficiently and bring down public debt. So there’s every chance we could again be asking about the future of the triple lock before the end of the next financial year.

We should also stress that the full state pension is currently £185.15 per week, which works out to less than £10,000 a year.

So even though it’s due to rise by £870 in April 2023, that’s still far from being enough money to live off, let alone enjoy the quality of life that you aspire to during your retirement.

That’s why you should make sure you have plans in place to supplement the state pension, such as workplace pensions, private pensions and other investments, and ensure that these represent the bulk of your income.

Then you can set yourself up to enjoy a much more comfortable lifestyle during your retirement, having the means to live the kind of life that you want and deserve.

If you have any questions about saving for retirement and making the most of your pensions, we’re here to help and will be happy to speak with you.

Get in touch and take charge of your retirement planning today.

Set financial new year’s resolutions for 2023…

The new year is almost upon us and we’ll all be setting our resolutions for the next 12 months.

Perhaps you want to improve your diet, quit smoking, learn a new skill or hobby, or pick up an old hobby that you’ve let slide over the years.

But have you thought about improving your financial habits too?

The new year could be a perfect time to get to grips with your finances, so you can set yourself up to achieve your ambitions and achieve the financial freedom you want.

That’s why we thought it useful to highlight a few common mistakes that people often make when they’re trying to get their finances in order, so you can hit the ground running from day one.

Not setting goals
If you’re investing your money in a particular market or asset type, it’s important to have a clear idea in mind of what you want to achieve. For example, are you looking to reduce your tax bill? Are you focused on generating additional income?

Only by having a clear goal in mind can you measure success or failure, and make changes where necessary to maximise your returns.

Not managing your debts properly
Many people have debts and financial obligations, from mortgage repayments to paying off your credit card bill.

Staying on top of these commitments is one of the best things you can do if you want to put yourself on a firmer financial footing. Not only can it help you pay down debts and free up cash, it can also improve your credit score, so you’re more able to borrow money in the future, should you need or want to.

Not putting money aside for a rainy day
We can be hit with sudden and unexpected expenses at any time. Perhaps a costly appliance breaks down and needs replacing, or your home suffers serious damage that has to be fixed.

So it’s well worth being prepared, in case of just such an emergency, with a pot of money completely separate to any pensions or savings accounts that you can use if needed.

Missing out on compound interest
Compound interest means you effectively get interest on the interest, so if you invest a sum of money, it can snowball into a much larger amount over a period of time. However, you only benefit if you don’t access this money during this period, so if you’re tempted to withdraw from time to time, you won’t enjoy as much compound interest as you would do otherwise.

Not checking your credit score
It’s easy to avoid checking your credit score until you actually need to borrow money or apply for a credit card. But if your credit score is low, your application could be rejected, which could potentially put your wider financial plans into jeopardy.

With that in mind, it’s worth keeping an eye on it regularly, so you can address any factors that might be lowering your credit score, and therefore increase the chances of your credit application being accepted straight away.

These are small steps you can take to help you on the path to financial freedom, but they can each yield significant benefits and results.

If you have any questions about getting your finances in order for 2023, please don’t hesitate to get in touch with us, and we’ll be happy to speak with you.