According to research (Arbuthnot Latham, 2024), 81% of the UK’s wealthiest individuals are

‘stressed’ about their finances, suggesting financial wellbeing is about more than just the totality of your wealth. So, virtually everyone has concerns about what their financial future will look like.

Planning for the future

The prime concerns for individuals centred around future planning and retirement, specifically maintaining a comparable lifestyle in later life (51%), the value of their investments (39%), providing for future generations (25%), the tax burden (24%) and falling victim to fraud (22%).

Interestingly, almost three in five wealthy individuals (59%) in the UK are considering relocating overseas, to enjoy what they regard to be an improved standard of living (36%), lower property costs (28%) and a more favourable tax regime (21%). 

The importance of financial wellbeing

Financial wellbeing is more than just having large sums of money. It’s a state of feeling secure and in control of your finances, both now and in the future. 

According to the Global Financial Wellbeing Report 2024 (nudge, 2024) , across all the countries surveyed, people’s top goal is to ‘feel secure’ (94%), noting that people who feel financially confident are ‘two times more likely to have goals, ambitions and dreams for their life.’

Finding your purpose

While money can’t buy you happiness, as the saying goes, it can give you security and freedom. But to get there, you need to have a plan. A good starting point is to work out what’s most important to you and what you want to achieve. Wealth has the capacity to create a powerful purpose within our lives, provided we are able to unlock its true value by understanding your ‘why’. Once you’ve established this, can create a plan unique to you that you can work towards with purpose.

Unlocking the real value of your wealth

We can help you to develop a clear understanding of what you want to achieve with your wealth, as well as provide you with the support and expert advice to help you develop a financial strategy that brings you closer to achieving those goals. There’s no point in worrying about your financial future when you could be taking valuable steps now to take control and face the future with confidence.

*The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

Getting a foot onto the property ladder has always presented challenges. Research suggests FTBs could currently be experiencing the most expensive conditions in 70 years (BSA, 2024).

Who is most affected?

In the current property market, a successful first purchase often requires two high incomes plus financial support from family members. Therefore, those who are buying alone, have lower incomes or cannot access help from the Bank of Mum and Dad are most likely to lose out.

How old?

Hopeful FTBs are forced to stay at home or in the private rented sector for longer. The average age of a first-time buyer is now 36, having risen from 32 in 2004 (ONS, 2024).

Delaying proceedings

Ongoing market uncertainty has caused hopeful homeowners to put their dreams on hold; over the last year, 49% of prospective FTBs have postponed their plans (Nationwide, 2024). Just over half (53%) said high house prices were the main reason for delaying, while 41% cited rising mortgage costs.

Making a compromise

FTBs will likely need to consider different options if they want to get on the property ladder; 38% of those who have become homeowners in the last five years said they had to compromise. For example, 40% purchased a home that needed some renovation and 34% moved to a different location.

Decline in homeowners

Overall, home ownership has fallen in the last 20 years, and the number of residential owner-occupier mortgages has decreased by more than two million since the rate peaked in 2002 (BSA, 2024). The UK has not seen such a low level of outstanding mortgages since the end of the 1980s.

Advice is key

We understand the difficulties that first-time buyers may face. You can make your home-owning dreams a reality with the right advice. Get in touch with our team today – www.audleywealth.com/contact-us 

Does your investment portfolio suffer from too much ‘home bias’? It’s natural for investors to stay cl

Are you thinking of buying a new build? The good news is there are more regulations than ever that protect buyers of newly built homes. It can be difficult to keep up with these changes, so here’s what you need to know.

 

Codes of conduct

Most developers are signed up to a code which lays out best practice for the marketing, building, and selling of new builds. Check which code your builder follows, so you know who is holding them to account if any issues arise. Many developers were signed up to the 

Consumer Code for Home Builders until 2021, when the New Homes Quality Board (NHQB) was launched.

 The guidelines

Transparency is at the forefront of both the Consumer Code for Home Builders and the New Homes Quality Code from the NHQB. Consumers have the right to withdraw from the purchase if the housebuilder makes any changes to the home. Deposits must be protected and high-pressure sales tactics are prohibited to protect vulnerable customers. The housebuilder must also provide an after-sales service for up to two years after legal completion.

 Check for snags

Defects with the property – otherwise known as snags – are a common problem with new builds. Buyers can commission a professional snagging company to inspect the new build before they move in. If the developer is registered with the NHQB, they are required to rectify any snags within 30 days, unless there is a suitable reason for delay.

 Complaints procedure

Each code has a process and timeframe for the handling of complaints. The New Homes Ombudsman Service is free for anyone whose developer is registered with the NHQB. Meanwhile, issues with housebuilders signed up to the Consumer Code for Home Buyers can be taken to the Independent Dispute Resolution Scheme.

 *As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments

ose to home when thinking about investing, contemplating well-known UK companies or UK-focused funds rather than looking further afield. But if your portfolio becomes too heavily concentrated in the UK, you risk missing out on valuable diversification benefits and better potential returns elsewhere.

The drawbacks of home bias

One of the biggest reasons to avoid home bias is that it limits your portfolio’s growth potential. Investing with a global perspective opens up your portfolio to a world of different countries, industries and companies to invest in, potentially leading to higher returns over time. Importantly, investing globally means you’re more likely to gain exposure to high-growth sectors or companies that are not always present in your domestic market, whereas sticking with the UK means narrowing your opportunities, even if you own some outstanding local companies.

The benefits of diversification

At the same time, home bias in a portfolio breaks one of the biggest investment rules: diversification. Spreading your portfolio across different asset classes, countries and companies is one of the simplest – yet most effective – ways to mitigate risk within your portfolio and help you achieve more consistent returns over time. Studies and historical data show that including international investments in a portfolio can lead to better risk- adjusted returns due to diversification benefits, though geopolitical risks must be considered. Global markets offer a wider range of asset classes and reduce your vulnerability to economic downturns specific to your home country.

However, over-diversification is a risk to be wary of too! It occurs when additional investments diminish returns without lowering risk significantly. Regular reviews and rebalancing help maintain a well-diversified portfolio and manage any potential concentration risk that may occur over time.

Ready to invest? 

Recent research suggests that some Britons are starting to save more despite the cost-of-living crisis (Aldermore, 2024). Now might be the right time to start thinking about investing if you have some money on the sidelines.

Get in touch with Audley Wealth today – www.audleywealth.com/contact-us

*The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

Does your investment portfolio suffer from too much ‘home bias’? It’s natural for investors to stay close to home when thinking about investing, contemplating well-known UK companies or UK-focused funds rather than looking further afield. But if your portfolio becomes too heavily concentrated in the UK, you risk missing out on valuable diversification benefits and better potential returns elsewhere.

 

The drawbacks of home bias

One of the biggest reasons to avoid home bias is that it limits your portfolio’s growth potential. Investing with a global perspective opens up your portfolio to a world of different countries, industries and companies to invest in, potentially leading to higher returns over time. Importantly, investing globally means you’re more likely to gain exposure to high-growth sectors or companies that are not always present in your domestic market, whereas sticking with the UK means narrowing your opportunities, even if you own some outstanding local companies.

The benefits of diversification

At the same time, home bias in a portfolio breaks one of the biggest investment rules: diversification. Spreading your portfolio across different asset classes, countries and companies is one of the simplest – yet most effective – ways to mitigate risk within your portfolio and help you achieve more consistent returns over time. Studies and historical data show that including international investments in a portfolio can lead to better risk- adjusted returns due to diversification benefits, though geopolitical risks must be considered. Global markets offer a wider range of asset classes and reduce your vulnerability to economic downturns specific to your home country.

However, over-diversification is a risk to be wary of too! It occurs when additional investments diminish returns without lowering risk significantly. Regular reviews and rebalancing help maintain a well-diversified portfolio and manage any potential concentration risk that may occur over time.

Ready to invest? 

Recent research suggests that some Britons are starting to save more despite the cost-of-living crisis (Aldermore, 2024). Now might be the right time to start thinking about investing if you have some money on the sidelines.

Get in touch with Audley Wealth today – www.audleywealth.com/contact-us

 

*The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

Do you have hopes to buy? Whether you’re looking to get on, move up or down the ladder, your property dreams are possible with a little preparation. Here’s how you can get yourself mortgage-ready this summer.

 

Check your credit score

Lenders will inspect your credit report for evidence that you can meet the mortgage repayments. Check your records for free now so you have time to make any improvements. No matter where you are today, there is always an opportunity to boost your score.

 

Consistency is key

Mortgage lenders are looking for signs that you are responsible, so paying your bills on time is a great way of boosting your credibility. Any indication that you could go into debt may put off a lender, so be mindful of your outgoings especially in the months running up to your application.

 

Go through old accounts

Consider how any inactive accounts might affect your application. It is advisable to close accounts that are out of date – particularly joint accounts with people you are no longer financially linked to.

 

Register to vote

Being on the electoral roll serves as proof of your identity and address.

 

Maximise your deposit

With high loan-to-value (LTV) mortgages available, it can be tempting to place the smallest possible deposit on a property. However, this will cost you more in the long run as your monthly repayments will be higher. Do your future-self a favour and put down any extra cash that you can.

 

Seek advice

You don’t need to navigate the mortgage market on your own. We can find options that you might not have access to, advise on schemes that could help, and assist you with the application process.

 

Get in touch with our team today! – www.audleywealth.com/contact-us

*As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments

Have you ever made an irrational or impulsive purchase you’ve later regretted? We all make decisions based on our emotions or personal biases, but when it comes to investing, such mistakes can be very costly.

What is behavioural investment?

Behavioural investment is an approach that acknowledges how our emotions and our biases can sometimes make decisions for us. During periods of geopolitical uncertainty and heightened risk, behavioural investment biases can become even more pronounced, tempting you into making poor decisions. Here are some impulses that often lead to bad investment decisions:

• Loss aversion: Investors worry about their investments falling further in value, so they sell them prematurely, locking in losses and missing out on potential rebounds

• Herd mentality: When markets fall, people tend to panic, follow the crowd and sell their investments. This ‘herd mentality’ means markets keep falling, as more people panic and sell, creating a spiral

• Confirmation bias: Investors let their own opinions dictate their actions and often seek out information that confirms their existing fears, ignoring evidence that contradicts their own impulses

• Overconfidence: Some investors believe they can predict the market’s reaction to geopolitical events, leading them to make risky bets that could ultimately backfire. 

Avoiding behavioural biases

Investors often need to worry less about geopolitical events and more about avoiding making poor decisions. Worry not, you’re in safe hands. We can create a plan and stick to it, so we focus on longer-term goals, rather than risk getting distracted by short-term noise.

We will build a resilient portfolio, spreading your investments across different asset classes to manage risk. Rest assured, we will make well-considered, researched investment decisions to increase your chances of achieving your long-term financial goals.

Get in touch with our team today to discuss your options – www.audleywealth.com/contact-us

The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

This year, summer brings hope of a better financial future as inflationary pressures recede and the economy continues to grow. It could therefore be an ideal opportunity to prioritise a range of pension-related issues in order to ensure brighter days do lie ahead.

Pension withdrawals up

Many people have faced significant financial challenges over the last few years. Recently released Financial Conduct Authority data covering 2022/23 highlights these difficulties, with the number of pension plans accessed for the first time up by 5%. However, as recent challenges begin to ease, it is hoped that, rather than dipping into pension savings, people’s focus will increasingly return to boosting their retirement pots and sorting out other pension-related concerns.

Expression of wishes

One pertinent issue relates to inheritance, with research (Canada Life, 2024) showing that almost half of all UK pension savers have not considered who will inherit or otherwise benefit from their retirement savings. Since April’s Lifetime Allowance changes, decisions around pension beneficiaries have become more vital due to the way such pensions are taxed on receipt. It is therefore extremely worrying that the research also found over half of respondents had not completed an expression of wishes form, with a further one in ten unaware if their forms were up to date.

Taxing issues

Most people appreciate the tax advantages associated with pension contributions, but what is often less well-known is their potential to passon wealth tax-efficiently. This means pensions can play an important role in supporting loved ones after you pass away. Pensions can also be advantageously used to navigate the Child Benefit trap, as pension contributions reduce taxable income and can thereby enable some people to avoid paying the Child Benefit Charge.

Pension conversations

We all appreciate the importance of devoting time to our pension arrangements now to ensure we reap the benefits later. If you need help with any retirement-related issues, we can talk through your options and make sure you are maximising your pension benefits.

The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.

Following weeks of intense campaigning, the electorate has delivered its verdict. As widely expected, the Labour Party has secured a historic landslide victory, soaring past the magic 326 seat mark in the early hours of Friday morning. 

 

With the party now occupying over 400 seats, Sir Keir Starmer’s promise of “change” has certainly struck a chord with the electorate. In his victory speech, the incoming Prime Minister said, “We did it! You campaigned for it. You fought for it. You voted for it, and now it has arrived. Change begins now.” 

 

The Conservatives sustained huge losses in the party’s worst ever election performance. Outgoing Prime Minister Rishi Sunak said, “The British people have delivered a sobering verdict tonight, there is much to learn… and I take responsibility for the loss.” He continued, “Today, power will change hands in a peaceful and orderly manner, with goodwill on all sides. That is something that should give us all confidence in our country’s stability and future.”

 

Mr Sunak, who has been in office since October 2022, managed to hold on to his seat in Richmond and Northallerton in Yorkshire; meanwhile, a raft of senior Conservative MPs lost their seats including former Prime Minister Liz Truss, Defence Secretary Grant Shapps, Penny Mordaunt and Jacob Rees-Mogg. In Wales, the Conservative Party lost all of their seats. 

 

It was a record-breaking night for the Liberal Democrats, who secured over 70 seats. In the early hours of Friday morning, Sir Ed Davey said his party was set to achieve its “best result for a century.” Meanwhile, Reform UK leader Nigel Farage was voted an MP for the first time and the Green Party also broke records.

 

The Scottish National Party (SNP) suffered a dismal night, with SNP leader John Swinney describing the General Election result as “very, very difficult and damaging” for the party. The result greatly diminishes the chances of an independence referendum.

 

In the first July General Election since 1945, millions of voters made their way to polling stations on Thursday to have their say. However, early indications suggest an estimated voter turnout of below 60% – the lowest in over 20 years.

 

Market reaction

In the run up to the election, the markets were reasonably stable with a strong Labour victory already priced in and investors hopeful of a pro-growth productivity-led agenda. As the markets opened following the results on 5 July, the FTSE 100 and FTSE 250 both opened up and sterling held steady after the exit polls came in on Thursday evening.

What now?

 

A new parliament will be summoned to meet on 9 July. The King’s Speech is scheduled for 17 July and is part of the State Opening of Parliament, before which no substantive parliamentary business can usually occur. The new government will then decide a date on which the summer recess will commence. 

 

And a Budget?

 

We await the date of incoming Chancellor Rachel Reeves’ first Budget, where we will gain clarity on the new government’s fiscal priorities, where any changes to tax and spending will be announced. Ms Reeves said Labour would not hold a Budget without an independent forecast by the Office for Budget Responsibility (OBR), these require ten weeks’ notice to prepare.

 

Labour manifesto key pledges

 

Some of the new government’s key manifesto pledges include reforming planning rules, recruiting 6,500 new teachers and tackling immigration. Plans are expected to be funded by raising £8bn through abolishing the non-dom tax status, increasing Stamp Duty for foreign buyers, clamping down on those underpaying tax by closing ‘loopholes’ in the windfall tax on oil and gas firms, and introducing VAT on private school fees (Rachel Reeves has suggested this won’t be imposed until at least 2025). No changes were promised to personal tax rates and on pensions, the Triple Lock is expected to be upheld and a review of the pensions landscape undertaken.

 

The bottom line

Whichever way you voted on 4 July, the country has acted decisively to provide a massive majority and, under Keir Starmer’s leadership the hard work begins. As usual, we will keep a close eye on developments likely to impact your personal finances over the coming months. Looking after your financial future remains a priority. Please get in touch if you have any questions.

*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. 

All details are correct at time of writing (5 July 2024)

If elections have consequences, as Barack Obama said, then 2024 looks like being a highly consequential year. Some 64 countries are due to hold elections this year (including the US, India, Brazil, Russia and very probably the UK), representing over half of the global population and, in economic terms, half of the world’s gross domestic product (GDP).

Depending on the outcomes, some of these elections carry significant global implications, influencing not only the geopolitical landscape but also impacting global and regional investment markets. So, how could this year’s elections affect the investment landscape and, by extension, your portfolio?

What are the investment implications?

Election years are typically marked by increased uncertainty and speculation because there’s nothing that markets hate more than uncertainty. A change in a country’s leadership or policy direction can affect everything from its stock market to commodity prices, influencing investor sentiment worldwide. 

From a UK perspective, elections in countries such as India, Brazil, and even the European Union, could have wide-reaching implications, and the results will be important in terms of supply chains, access to commodities and trade policies. With 70% of revenues earned by FTSE 100 listed companies derived overseas, domestic shareholders will be keeping a close eye on global election results. It’s impossible to talk about elections in 2024 without discussing the elephant in the room – the US.

A rematch?

As the world’s largest economy, the US sets the tone for global economic policies regarding trade, regulation, and fiscal stimulus. Democratic presidents are usually better for the US economy, and for investment returns in general, but given his low approval rating, the re-election of President Joe Biden is far from certain. The race is unlikely to be a straight line, and an election victory for Trump, despite numerous legal issues, could cause ripples worldwide as investors work out the likely implications for the US and indeed the rest of the world.

What should investors be thinking about?

Uncertainty about election outcomes and the potential for policy changes often lead to short-term fluctuations in asset prices. And while keeping an eye on political developments is important, there’s no reason to be overly concerned about how an election year could affect your investment over the longer term. It’s important not to be distracted by short-term ‘noise.’ 

The best way to prepare for potential market volatility is to have a well-diversified investment portfolio that is aligned with your long-term financial objectives and managed to meet your personal financial goals.

For more information, contact our team today – www.audleywealth.com/contact-us

*Content is for informational purposes only. You may not get back the original amount invested. 

Have you developed a retirement strategy yet? Whether you’re nearing retirement, or you still have many years of your working life ahead, careful planning is essential to secure financial stability and peace of mind when you stop working.

Active planning is important

According to a recent report (Standard Life, 2024), individuals on average begin actively planning for retirement around the age of 36. At this age, 63% of respondents expressed confidence in their financial decision-making abilities, a notable increase compared to younger demographics where only 56% share the same level of confidence.

With more than a decade of work experience under their belt by age 36, the ‘age of responsibility’ arrives for many people, with increasing awareness of the importance of financial planning, including actively thinking about their retirement. 

Whatever your age, a well-thought-out retirement strategy is a must!

Decades to go?

Younger individuals can afford to adopt a more aggressive investment approach with their pension pot, embracing riskier assets for potentially higher returns over time, if they are comfortable doing so. Although this strategy does involve exposure to short-term market fluctuations, the longer investment horizon allows ample time for recovery from any downturns (during which monthly pension contributions may be invested at the cheaper asset prices).

If you’re closer to retirement

For those on the cusp of retirement in the next few years, a prudent approach

involves creating a smooth, non-volatile investment profile which minimises risk for the first five to ten years of retirement, with the remainder invested in more volatile funds which have the potential to grow over the longer term. This approach should help to shield your pension pot from the unpredictable nature of market volatility, as witnessed during events

like the pandemic or financial crashes. By maintaining a stable portfolio for the initial years of retirement, you minimise the risk, thus safeguarding your financial wellbeing.

How about the ‘inbetweeners’?

For those falling between these two extremes, a balanced and risk-managed approach is advisable. The strategy here is to aim for a balanced mix of stable and more volatile investments, aligned to your risk tolerance and personal financial goals. Diversifying your portfolio across various asset classes helps mitigate risk while providing the potential for growth.

The importance of rebalancing

Regular portfolio rebalancing is vital for a sound retirement strategy. Market fluctuations and varying asset performances can cause your portfolio to deviate from its original allocation over time. Without intervention, this drift could lead to unintended asset concentration and increased risk exposure.

For more information, contact our team here – www.audleywealth.com/contact-us

*The value of investments and income from them may go down. You may not get back the original amount invested. A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.