Blog - The Wealth Coach : The Wealth Coach

What happens when I sell my business?

Selling a business is often a process rather than a single event. Understanding what typically happens helps clarify expectations. The sale process A business sale may involve: valuation negotiation completion After the sale After selling, attention often turns to: tax proceeds next steps A final note This article explains what typically happens when selling a business, not how to manage a sale. If business sale decisions feel uncertain, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

Should I invest personally or through a company?

Investing personally and investing through a company involve different structures. Understanding the distinction helps clarify planning choices. Personal investing Personal investing involves: individual ownership personal tax treatment Company investing Company investing involves: corporate ownership company tax rules A final note This article explains the difference between personal and company investing, not which is better. If investment structure feels unclear, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

What tax do I pay when selling a business?

Selling a business can involve several types of tax. Understanding the basics helps clarify why outcomes vary. Common taxes involved Taxes may include: capital gains tax business asset disposal relief other charges depending on structure Why outcomes differ Tax depends on: ownership structure timing reliefs available A final note This article explains the types of tax that may apply, not how much tax will be paid. If selling a business feels complex, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

What is an exit strategy?

An exit strategy describes how value may be realised from an investment or business. Understanding the concept helps clarify longer-term planning. Business exit strategies For business owners, exit strategies may involve: selling passing on ownership winding down Investment exit strategies For investments, an exit strategy may refer to: when assets are sold how proceeds are used A final note This article explains what an exit strategy is, not how to create one. If exit planning raises questions, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action….

09.02.2026

What does “risk profile” mean?

A risk profile describes how someone approaches investment risk. Understanding the term helps clarify how investment decisions are framed. What a risk profile reflects A risk profile often considers: capacity for loss attitude to risk investment timeframe Why it’s used Risk profiling helps structure discussions about investments, not predict outcomes. A final note This article explains what risk profile means, not how to determine yours. If risk discussions feel unclear, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

How risky are my investments?

Investment risk refers to uncertainty about outcomes. Understanding risk helps clarify why investments behave differently. Types of risk Risk may relate to: market movements specific investments time horizon Risk and expectations Risk is often linked to potential returns, but outcomes are uncertain. A final note This article explains how investment risk is commonly described, not how risky your investments are. If investment risk feels unclear, some people find it helpful to think things through before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

What happens to investments in a market crash?

Market crashes are periods of sharp market declines. Understanding how investments behave during these times helps clarify expectations. What typically happens During a crash: asset values may fall quickly volatility increases investor reactions vary Recovery and timeframes Markets have historically recovered over time, but timing and experience differ. A final note This article explains what typically happens in a market crash, not how to respond. If market movements raise concerns, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

What’s the difference between active and passive investing?

Active and passive investing describe two different approaches to managing investments. Understanding the difference helps clarify how investment strategies vary. Active investing Active investing involves: selecting investments with the aim of outperforming the market higher involvement by fund managers Passive investing Passive investing typically: tracks a market index aims to match market performance often involves lower costs A final note This article explains the difference between active and passive investing, not which approach is better. If investment approach feels unclear, some people find it useful to think things through before advice or action. Evoa exists for that purpose — before…

09.02.2026

How do investment funds work?

Investment funds allow money from multiple investors to be pooled together. Understanding how they work helps clarify how investments are managed. What an investment fund does A fund: pools investor money invests according to a stated objective is managed by a fund manager or process Types of funds Funds may differ by: asset type investment style level of risk A final note This article explains how investment funds work, not which funds to choose. If investment structures feel unclear, some people find it helpful to gain clarity before advice or action. Evoa exists for that purpose — before advice and…

09.02.2026

What fees am I paying on my investments?

Investment fees affect returns over time, which is why people ask what they are paying. Understanding fee types helps clarify overall costs. Common investment fees Fees may include: fund charges platform fees adviser or management fees They are often expressed as percentages. Why fees matter over time Small differences in fees can have a noticeable impact over long periods. A final note This article explains common investment fees, not whether they are appropriate. If investment costs feel unclear, some people find it useful to think things through before advice or action. Evoa exists for that purpose — before advice and…

09.02.2026

How often should I review my investments?

Investment reviews help ensure investments still reflect objectives and circumstances. The question is often about balance — reviewing often enough, but not too often. Typical review approaches Many people review investments: annually at agreed intervals when circumstances change There is no single correct frequency. Avoiding short-term reactions Reviewing too frequently can lead to decisions driven by short-term market movements rather than long-term plans. A final note This article explains how people typically approach investment reviews, not how often you should review. If reviewing investments raises wider questions, some people find it helpful to gain clarity before advice or action. Evoa…

09.02.2026

What are the rules around gifting money?

Gifting money can be part of family planning, but tax rules depend on timing and circumstances. Understanding the rules helps clarify when gifts are tax-free and when they may be considered later. Lifetime gifts and inheritance tax Some gifts may fall outside inheritance tax if the giver survives for a certain period. Other gifts may be immediately exempt. Common allowances UK rules include: annual gifting allowances small gift exemptions gifts made out of surplus income Each has specific conditions. Why records matter Keeping records of gifts can help clarify how they are treated later. A final note This article explains…

09.02.2026

How much inheritance tax will my estate pay?

Inheritance tax is often discussed in general terms, but people usually want to know how it applies to their own estate. Understanding how inheritance tax is calculated helps clarify when tax may be due and why amounts can vary. How inheritance tax is assessed Inheritance tax is based on: the total value of an estate at death available allowances and exemptions who assets are left to Not all estates pay inheritance tax. Thresholds and allowances There is a nil-rate band below which inheritance tax is not usually payable.Additional allowances may apply, including those linked to passing a home to direct…

09.02.2026

How to reduce capital gains tax

People often ask how capital gains tax can be reduced. In practice, this is usually about understanding allowances and timing. Common considerations People often look at: annual allowances spreading disposals over tax years offsetting losses Rules matter Capital gains tax rules are detailed and depend on individual circumstances. A final note This article explains general principles, not how to reduce tax in a specific case. If capital gains tax planning feels unclear, some people find it helpful to think things through before advice or action. Evoa exists for that purpose — before advice and before action. 👉 https://www.thewealth.coach/evoa

09.02.2026

How does capital gains tax work?

Capital gains tax applies to profits made when selling certain assets. Understanding how it works helps clarify when tax may be due. What counts as a gain A gain is usually the difference between: what you paid for an asset what you receive when you sell it Assets it applies to Capital gains tax can apply to: shares investment property business assets Allowances There is an annual allowance allowing some gains to be made tax-free. A final note This article explains how capital gains tax works, not how to reduce it. If capital gains tax raises questions about planning, some…

09.02.2026

Can I give money to my children tax-free?

Giving money to children is common, but tax treatment depends on timing and circumstances. Understanding the rules helps clarify when tax may apply. Gifting rules in the UK In general: gifts may be tax-free if certain conditions are met inheritance tax rules often apply The seven-year rule Some gifts fall outside inheritance tax if the giver survives for seven years. Allowances and exemptions There are also annual allowances and other exemptions that may apply. A final note This article explains how gifting rules work, not how to structure gifts. If gifting raises questions about timing or impact, some people find…

09.02.2026

What is Inheritance Tax and who pays it?

Inheritance tax is a tax that may apply when someone dies, depending on the value of their estate. Understanding who pays inheritance tax helps clarify how it works in practice. When inheritance tax applies Inheritance tax usually applies if an estate exceeds certain thresholds. Allowances and exemptions may reduce or remove the tax. Who pays the tax Inheritance tax is usually paid: by the estate before assets are distributed Beneficiaries typically receive assets after tax has been settled. A final note This article explains the basics of inheritance tax, not how much tax an estate will pay. If inheritance tax…

09.02.2026

How do I know if my adviser is doing a good job?

Many people wonder how to assess the quality of financial advice they receive. The answer is often less about short-term performance and more about process and clarity. What advice is measured against In the UK, advice must be: suitable for the individual clearly explained documented This provides a reference point over time. Common indicators people look for People often assess advice by considering: clarity of communication understanding of their situation regular reviews explanations that make sense Performance versus process Short-term investment performance alone is rarely a reliable indicator of advice quality. Advice is usually judged over longer periods. A final…

09.02.2026

What’s the difference between independent and restricted advice?

In the UK, financial advice is described as either independent or restricted. Understanding the difference helps clarify the scope of advice an adviser can provide. UK regulation requires advisers to explain whether their advice is independent or restricted. Independent advice Independent advisers: can consider products from the whole market are not limited to specific providers must provide unbiased and unrestricted advice Restricted advice Restricted advisers operate with limitations, such as: advising on a limited range of products using a specific provider or panel focusing on certain types of solutions The restriction must be explained clearly. Is one better than the…

09.02.2026

How are financial advisers paid?

Financial advisers can be paid in different ways, depending on the services they provide and how their business operates. Understanding how advisers are paid helps clarify how advice works in practice and what charges usually relate to. In the UK, financial advisers must explain clearly how they are paid before providing advice. Common ways advisers are paid Most UK financial advisers are paid through fees, rather than commission. These fees may be charged as: a fixed fee an hourly rate a percentage of assets being advised on The structure depends on the type of work involved. What adviser fees usually…

09.02.2026

How much does a financial adviser cost?

If you are thinking about using a financial adviser, one of the first questions is usually simple: How much is this going to cost me? It is a sensible question.And often an uncomfortable one. Not because fees are unclear, but because behind the question usually sits a deeper worry: Am I about to overpay? Is advice actually worth it? Could I do this myself? How do I know if the adviser is good value? So before looking at numbers, it helps to understand what you are really paying for. The three common ways advisers charge in the UK Most UK…

09.02.2026

What does a financial adviser actually do?

Financial advisers play a role in helping people make informed decisions about their finances, but what they do in practice can vary. Understanding the adviser’s role helps clarify how advice fits into financial decision-making. In the UK, financial advisers are regulated and must provide advice that is suitable for the individual. The core role of a financial adviser A financial adviser typically: assesses a person’s financial situation identifies goals and constraints provides recommendations Advice may cover areas such as pensions, investments, and long-term planning. Advice and implementation Advisers may: recommend actions support implementation provide ongoing reviews The scope of services…

09.02.2026

How do I find old pensions?

It’s common to lose track of pensions over time, particularly after changing jobs. Finding old pensions usually involves reconnecting with previous employers or providers. Understanding the process can make tracing pensions more straightforward. In the UK, there are established ways to trace old pensions, even if you no longer have paperwork. Start with what you have Begin by: checking old paperwork reviewing employment records listing previous employers Even partial information can help. Contact former employers Previous employers can often confirm: which pension provider was used whether a pension exists This is often the simplest first step. The Pension Tracing Service…

09.02.2026

Should I consolidate my pensions?

Many people build up several pensions over their working life, often through different employers. This leads to a common question: should pensions be consolidated into one place? Understanding what pension consolidation involves — and the trade-offs — helps clarify why people consider it. In the UK, pension consolidation can simplify administration, but transferring pensions may involve giving up certain features or guarantees. What does pension consolidation mean? Consolidating pensions usually means: transferring multiple pension pots into a single pension arrangement This brings different pensions together in one place. Why people consider consolidation People often look at consolidation to: reduce paperwork…

09.02.2026

What happens to my pension when I die?

When someone dies, what happens to their pension depends on the type of pension they have and their age at death. Understanding the basic rules can help clarify what usually happens to pension benefits and how they are typically passed on. In the UK, pension death benefits are governed by specific rules, and the tax treatment often depends on whether death occurs before or after age 75. Defined contribution pensions For defined contribution pensions — such as personal pensions, workplace pensions, and SIPPs — any money remaining in the pension does not usually disappear when someone dies. Instead, it can…

09.02.2026

How much tax do I pay on pension withdrawals?

In the UK, pension withdrawals are usually partly tax-free and partly taxable. How much tax you pay depends on how much you withdraw, how you take it, and what other income you have in the same tax year. Understanding how pension withdrawals are taxed helps explain why the timing and structure of withdrawals can make a difference to the amount you keep. In the UK, pension withdrawals are flexible, but income tax rules mean the way money is taken can significantly affect the tax paid. The 25% tax-free amount In most cases, you can take up to 25% of your…

08.02.2026

Is it better to take a lump sum or income from my pension?

When accessing a pension in the UK, one of the most common questions is whether it’s better to take money as a lump sum or as a regular income. There isn’t a single right answer for everyone. The two approaches work in different ways and involve different tax and flexibility considerations. Understanding the basic differences can help clarify how each option works in practice. In the UK, pension withdrawal rules allow both lump sums and income, but the tax treatment and long-term impact can vary significantly depending on how money is taken. What does taking a lump sum mean? Taking…

08.02.2026

When can I access my pension?

In the UK, there are clear rules about when you can start taking money from your pension. These rules are based mainly on age, with a small number of exceptions. Understanding when you can access your pension helps set realistic expectations about retirement planning and avoids assumptions about money being available earlier than it actually is. In the UK, pension access is restricted until a minimum age, and accessing pension money earlier than this is usually not allowed except in specific circumstances. The normal minimum pension age For most people, pensions can usually be accessed from age 55. This is…

08.02.2026

How does pension drawdown work?

Pension drawdown is one of the main ways people access their pension in the UK. It allows you to keep your pension invested while taking money from it over time, rather than converting it into a guaranteed income straight away. Understanding how pension drawdown works can help you see how flexible it is — and what the main trade-offs are — before deciding how to use it. In the UK, pension drawdown rules are flexible, but how much you withdraw and how your pension is invested can significantly affect how long it lasts. What is pension drawdown? Pension drawdown (sometimes…

08.02.2026

How much can I take from my pension?

If you have a pension, it’s natural to wonder: How much can I actually take out? For many people, this question only becomes real when retirement feels closer — or when life changes prompt a need for flexibility. And behind it is often a deeper uncertainty: Will I be taxed more than I expect? Am I allowed to take it all? What happens if I take too much, too soon? How do I avoid making a mistake I can’t undo? Understanding how pension withdrawals work in the UK helps bring clarity before decisions are made. The starting point: access age…

07.02.2026

Most people believe they are being careful.

They say they don’t want to rush.They want to wait for the right moment.They want to be prudent. On the surface, this sounds responsible. Often, it isn’t. Much of what passes for financial caution is something else entirely. It is avoidance dressed up as responsibility. Caution is a deliberate posture.Avoidance is an unconscious one. The difficulty is that they feel identical from the inside. Both involve waiting.Both involve not acting.Both can be justified with sensible language. But only one involves thinking. Avoidance rarely announces itself honestly. People don’t say, “I don’t want to look at this.”They say, “I’ll deal with…

02.02.2026

Why does financial advice still feel unclear?

If you already have a financial adviser and financial advice still feels unclear, you’re not being unreasonable. Most people don’t expect advice to feel perfect.But they do expect it to feel clearer than this. Clear enough to understand what’s really going on.Clear enough to know why certain decisions are being recommended.Clear enough to feel oriented — not just reassured. So when clarity never quite arrives, it can be quietly unsettling. The thought people rarely say out loud Many people with advisers carry a private thought they rarely voice: “I’m not sure I actually understand this as well as I should.”…

02.02.2026

Most people don’t make bad financial decisions

Most people don’t make reckless or foolish financial choices.At the time they were made, many decisions were sensible, informed, and appropriate. The problem is rarely the original decision. It’s how long it’s left unquestioned. Over time, decisions quietly turn into defaults.Portfolios are left untouched. Assumptions go unexamined.What once felt deliberate becomes automatic. Not because people stop caring, but because life moves on. And the world does too. When sensible decisions outlive the reasons behind them Financial decisions are usually made in a specific context: a certain job a certain family situation a certain tax environment a certain understanding of risk…

28.01.2026

The moment you ask for advice

Most people don’t notice the moment it happens. They arrive uncertain. Thoughtful. Often uneasy.They want help thinking something through. And then, almost imperceptibly, the conversation changes. The moment you ask for financial advice, you enter a commercial environment. That statement is neither an accusation nor a warning.It’s not about bad actors, hidden motives, or moral failure.It is simply a description of the system you have stepped into. Advice is not discovered.It is sold. And selling, by its nature, has momentum. Once advice begins, uncertainty subtly becomes a problem to be resolved rather than a state to be understood. Questions start…

26.01.2026

How to use AI safely with money

Artificial intelligence can be a powerful thinking partner when it comes to money. It can help you organise your thoughts, explore options, and gain clarity before making decisions. But money is personal. And not everything belongs inside an AI conversation. Here is a simple, practical guide to using AI safely, without fear, friction, or unnecessary complexity. A simple rule to start with If you wouldn’t feel comfortable reading it out loud in a coffee shop, don’t upload it. This one test catches most problems before they start. Start with thinking, not documents AI does not need your paperwork to be…

16.01.2026

Why some heirs want independence rather than wealth

Not every child in a wealthy family wants the wealth.Some want independence far more.Some want to build their own path.Some want identity, not inheritance.Some fear the expectations that come with money.Some feel the weight of comparison.And some simply want freedom. This often surprises parents, but it should not.Independence is a natural expression of adulthood.And in families with wealth, independence can feel harder to achieve. Wealth gives comfort, but it can also cast a long shadow.Children can feel defined by something they did not create.They can feel judged by a standard they did not choose.They can feel pressure to live up…

08.01.2026

The biggest financial risk is disengagement

Every few years, a bold idea resurfaces. This time it is the suggestion that advances in artificial intelligence may remove the need to save for retirement at all.That productivity will explode.That abundance will replace scarcity.That the old models of work, income, and saving will no longer apply. It is an interesting idea.And it may even be partly true over very long time horizons. But there is a much bigger risk hiding underneath it.Not that AI will change the world.But that people use that possibility as a reason to stop thinking altogether. Disengagement is the real danger. When people hear claims…

08.01.2026

Why wills are not enough

Most families assume that writing a will is enough to protect their wealth.It is an important step, but on its own it is nowhere near sufficient.A will distributes assets.It does not prepare people. A will can tell your family what they will receive.It cannot tell them why.It cannot explain your intentions.It cannot resolve old tensions or prevent new ones.It cannot prepare heirs for responsibility or guide them through decisions they have never faced before. A will handles the legal side of legacy.But legacy is not legal.It is emotional, relational, and behavioural. Families often believe that clear instructions will prevent conflict.But…

07.01.2026

Preparing children for wealth without creating dependence

One of the hardest challenges for successful families is preparing children for wealth without creating dependence.It is a delicate balance.Too much support and they lose resilience.Too little support and they feel abandoned. Money can open doors, but it can also quietly close others.It can give choices, but it can also remove the urgency required to grow, learn, and struggle in healthy ways.Children need enough support to feel safe, yet enough friction to develop strength. Dependence does not happen overnight.It grows in small, well intentioned decisions.Parents paying for everything.Parents solving every problem.Parents removing every obstacle.Parents stepping in before their children have…

06.01.2026

Why wealth does not solve money anxiety

One of the great surprises for many wealthy people is this.Money does not eliminate anxiety.It changes the shape of the anxiety, but not the existence of it. Most people assume that wealth brings certainty.That once you have enough, the worry fades.But the truth is that money anxiety does not disappear with success.It simply evolves. People with money do not fear running out tomorrow.They fear misunderstanding something important.They fear making a mistake that cannot be undone.They fear being badly advised.They fear missing something they should have seen.They fear becoming the next cautionary tale. The anxiety shifts from survival to stewardship. Wealth…

05.01.2026

Building a family system that outlives you

Every family wants its wealth to last.But lasting wealth does not come from investment returns or clever structures.It comes from the strength of the family system that surrounds the wealth.A system of thinking, behaviour, communication, and shared purpose. If the system is strong, the wealth endures.If the system is weak, the wealth dissolves.It is that simple. A family system is not a document.It is not a trust.It is not a set of instructions.It is the invisible framework that guides how a family behaves when decisions are difficult. Strong family systems have three essential components.Clarity.Consistency.Connection. Clarity comes from shared purpose.What the…

31.12.2025

The danger of secrecy in wealthy families

Secrecy is one of the most common patterns in wealthy families.And one of the most damaging.It is usually well intentioned, but it rarely leads to good outcomes. Parents keep financial details private because they want to protect their children.They want to avoid entitlement.They want to reduce pressure.They want to prevent conflict.They want to shield the next generation from complexity. But secrecy does not protect families.It destabilises them. When information is withheld, children fill the gaps themselves.They imagine more wealth than there is.Or less.They assume motives that were never real.They create their own explanations for decisions they do not understand.These assumptions…

29.12.2025

How to run a productive family meeting

Family meetings are one of the most powerful tools a family can use to protect wealth, clarity, and relationships.But most families never hold them.Or they only hold them at moments of crisis, when the emotional temperature is already too high.By then, the conversation becomes reactive rather than constructive. A productive family meeting is not about making everyone agree.It is about creating understanding.It is about connection, clarity, and shared direction.Done well, it prevents misunderstandings long before they become conflict. The first step is to create structure.Not rigid rules, but a clear framework.A meeting without structure becomes a debate.A structured meeting becomes…

23.12.2025

How to avoid creating entitled children

Every parent fears raising entitled children.Especially in families with wealth.It is a quiet worry that grows as success increases.Will the next generation appreciate what they have.Will they understand the effort behind it.Will they develop resilience, or will comfort weaken them. The truth is simple.Entitlement does not come from wealth.It comes from how wealth is handled. Entitlement grows when children receive outcomes without understanding process.Rewards without responsibility.Support without expectations.Comfort without contribution. When life becomes too smooth, children never feel the friction that builds strength. Avoiding entitlement begins with something powerful.Let children experience effort.Not artificial struggle, but real experience.Let them try, fail,…

22.12.2025

The real meaning of legacy

Most people think legacy is about what you leave behind.A sum of money.A business.A property portfolio.An investment account.A will that sets everything out neatly. But legacy is not what you leave behind.Legacy is what lives on.And the two are not the same. Money can be passed on in a moment.But the meaning behind it takes a lifetime to build. Legacy is not measured in pounds.It is measured in impact.In the behaviour your children adopt.In the stories they remember.In the decisions they make when nobody is watching.In the thinking you helped them develop.In the confidence they carry into adulthood. Legacy is…

19.12.2025

What families should pass on other than money

When people think about inheritance, they normally think about money.Assets.Property.Shares.Trusts.The financial side of legacy. But money alone has never been enough to keep a family strong.And it has never been enough to preserve wealth across generations. The families who thrive do so because they pass on far more than capital.They pass on the things that money cannot buy and cannot replace. They pass on values.What matters.What does not.How decisions are made.What is worth standing for.Values guide children long after the numbers fade. They pass on stories.Real stories.Stories of struggle, risk, resilience, purpose, and luck.Stories that keep memory alive and stop…

18.12.2025

How to build a united family culture

Every successful family has a culture, whether they know it or not.A way of thinking.A way of making decisions.A way of talking to each other.A way of responding to challenges. In families where wealth survives, that culture is not accidental.It is intentional.It is shaped.It is maintained.And it is passed down from generation to generation. A united family culture begins with something very simple.Shared values.Not vague words on a wall, but genuine principles that guide behaviour. Values such as contribution, effort, responsibility, curiosity, compassion, or independence.Values that matter in everyday decisions, not just at formal meetings.Values that children grow up seeing,…

17.12.2025

Why money magnifies identity

Money does not change people as much as most people think.What it really does is magnify who they already are.It amplifies what is already there.Strengths become more visible.So do insecurities, pressures, and unresolved issues. This is why wealth can feel liberating for some and destabilising for others.It is not the money itself.It is the identity behind it. Someone who is confident becomes more confident with wealth.Someone who feels inadequate often feels even more inadequate.Someone who is generous becomes more generous.Someone who is anxious becomes more anxious. Money acts like a loudspeaker for identity.It makes everything bigger, clearer, and less avoidable….

16.12.2025

Preparing heirs emotionally, not just financially

Most people think preparing heirs means preparing money for them.But the real work is preparing them for the money.And that is a completely different challenge. Financial preparation is practical.Emotional preparation is human.One deals with structures.The other deals with identity, confidence, and responsibility. When families forget the emotional side, money becomes heavier than anyone expects.Inherited wealth carries pressure.It raises questions.It can trigger insecurity.It can amplify old sibling dynamics.It can make someone feel unworthy, overwhelmed, or exposed. Not because they lack intelligence, but because they lack preparation. Children who grow up around wealth often feel two conflicting emotions.Expectation and uncertainty.They are expected…

13.12.2025

The role of stories in preserving family wealth

Every family has stories.Some are told proudly.Some are whispered.Some are forgotten until someone reminds us.And some are never shared at all. But in wealthy families, stories do more than entertain.They preserve meaning.They explain where the wealth came from.They give context to the struggles, sacrifices, mistakes, and breakthroughs that shaped the family’s journey. Stories create understanding in a way spreadsheets never can. A child who knows the story of how a business was built sees the wealth differently from a child who only sees the end result.One sees purpose.The other sees entitlement. A family that shares its stories passes on perspective.They…

12.12.2025

What wealthy parents get wrong about fairness

Wealthy parents care deeply about fairness.They want to treat their children equally.They want to avoid conflict.They want to create a sense of balance and avoid future resentment. But in trying to be fair, many parents unintentionally create the opposite.Not because they mean to, but because fairness is far more complex than equal numbers on a spreadsheet. The biggest mistake wealthy parents make is assuming that equality and fairness are the same.They are not. Equal distribution may feel mathematically clean, but families do not live in equations.They live in realities.Realities where one child may have greater need.Where another may have made…

11.12.2025

The psychology of gifting and resentment

Gifting sounds simple.A generous act.A kind gesture.A way to help those you love. But gifting inside families is rarely only about money.It touches identity, appreciation, recognition, and history.This is why gifts can strengthen relationships, but they can also quietly fracture them. Resentment grows not from the gift itself, but from what the gift represents.Or what someone thinks it represents. A parent gives one child money to help with a house deposit.Another child sees it as preference.A third sees it as interference.The parent sees it as support.Four people, four interpretations, one event. Gifts are emotional.They send a message, even when the…

09.12.2025

Why wealthy families struggle with fairness

Fairness is one of the most difficult issues for wealthy families.Not because they want to be unfair, but because fairness means different things to different people.And when money is involved, emotions intensify. To a parent, fairness might mean equal.To a child, fairness might mean need.To another, fairness might mean recognition.To someone else, fairness simply means being heard. The problem is that families rarely talk about what fairness actually means.They assume everyone has the same definition.They assume intentions are understood.They assume silence equals agreement. It does not. Fairness is subjective.It is shaped by personality, history, values, birth order, and even the…

08.12.2025

Wealth, family, and the hidden work of passing on purpose

Bill Ackman recently shared a series of notes from a talk by Michael Milken on family, success, and wealth. It is rare to see someone speak so clearly about what truly matters once money is no longer the problem. Milken’s insights were simple, direct, and uncomfortable in all the right ways. They also reveal a truth that sits at the centre of financial wellness.Families do not fail because of money.They fail because of meaning. Milken spoke about something every parent instinctively understands. You pay for the time you spend with your children, either now or later. Absence leaves a mark,…

06.12.2025

Why DIY investors lose 3 per cent a year and what you can do about it

Every so often you will see a study claiming that DIY investors underperform the market by roughly 3 per cent per year. These reports surface regularly, and the message is always the same.“You are losing money by doing it yourself. Give it to the professionals.” In most of the wealth management industry, this statistic is used as a sales tool. It is designed to convince you that investing alone is dangerous and that the only sensible solution is to outsource everything to a fund manager, wealth manager, or investment service. But there is another way to interpret the data.A way…

05.12.2025

The hidden dangers of financial silence

Most families do not talk about money.They avoid it.They tiptoe around it.They hope silence will protect their children from pressure or conflict.But silence rarely protects families.More often, it weakens them. Financial silence creates uncertainty.Uncertainty creates assumptions.And assumptions are the fuel that turns simple misunderstandings into resentment, rivalry, and mistrust. When money is not discussed, children fill in the gaps themselves.Sometimes they imagine there is more wealth than there is.Sometimes they believe they are expected to do something they never actually were.Sometimes they assume their siblings are being treated differently.All of this happens quietly, long before a will is ever read….

04.12.2025

How to create a thinking family

Money can be inherited.Wisdom cannot.It has to be learned, tested, discussed, and lived. This is why some families with modest assets thrive across generations, while others with far greater wealth slowly fall apart.The difference is not the size of the fortune.It is the strength of the thinking behind it. A thinking family does something most families never do.They make thinking a shared activity.They talk about decisions openly.They explain not just what they do, but why they do it.They involve each other in the process rather than protecting each other from it. Children do not become responsible by being shielded from…

03.12.2025

The role of purpose in protecting family wealth

When wealth survives across generations, it rarely survives by accident.There is always something holding it together.And that something is purpose. Purpose is the anchor that keeps families steady when life becomes uncertain.It is the reason behind the wealth, not just the wealth itself.It is the understanding of what the money is for. Without purpose, family wealth becomes directionless.It becomes a pot of money waiting for needs, wants, and confusion to collide.And eventually they do. Purpose answers questions before they become problems.Why do we invest the way we do.Why do we protect the family business.Why do we create trusts.Why do we…

02.12.2025

Why most people never ask their adviser the questions that matter

Elon Musk once said something that applies far beyond technology and into every part of our lives. “Do not tell me what you like. Tell me what you do not like.” Most people avoid negative feedback because it is uncomfortable. We prefer reassurance over honesty. We want to be told everything is fine, even when we are not entirely sure that it is. The problem is simple. When you avoid discomfort, you also avoid clarity. You learn nothing from the things that go well. You learn from the things that feel awkward. And nowhere is this more obvious than in…

01.12.2025

Why wealth fails in three generations

There is an old proverb that appears in different cultures around the world.In Britain we say clogs to clogs in three generations.In China it is wealth never survives three generations.In the United States it becomes shirtsleeves to shirtsleeves in three generations. Different words.Same insight.Most fortunes do not last. Not because markets collapse or businesses fail, but because families forget the thinking, the discipline, and the purpose that created the wealth in the first place. Money is rarely lost in dramatic events. It fades through slow erosion, misunderstandings, fractured relationships, and decisions made without context. When you look closely, the pattern…

01.12.2025

Hunger, feedback loops, and why investors forget what matters

Every day, without fail, something happens inside us. We get hungry. We do not need a reminder, an app, a calendar alert, or a government warning.The body tells us.We feel it.And because we feel it, we act. We think about what to eat, where to get it, how to cook it, and when. It is a natural feedback loop. A built in system that prompts behaviour. Now compare that to money. The absence of feedback is the real danger When it comes to money, the feedback loops are almost entirely invisible. They operate on long time horizons. They offer no…

30.11.2025

Why AI is exposing the truth about financial advice

Most industries are being forced to rethink their value.Management consultants, marketing agencies, designers, and researchers are all finding that people can get structured thinking from AI tools like Perplexity and ChatGPT in a matter of seconds. A prompt goes in, a clear analysis comes out. And this is now happening in wealth management. But instead of worrying, I see this as the best opportunity consumers have ever had to get better outcomes. Why? Because AI is exposing the truth about financial advice. Some firms add enormous value. Many do not. And most people never knew the difference. The hidden problem:…

29.11.2025

The adviser of the future

If we look ahead ten years, the financial adviser of the future will look very different from the adviser of today. That future will not be shaped by regulation, qualifications, or marketing. It will be shaped by thinking. Artificial intelligence is changing the foundations of the industry.But it is not replacing advisers.It is redefining what it means to be one. What will disappear The adviser of the future will not be:• a salesperson• a fund selector• a product guide• a risk profiler• a portfolio explainer AI will do all of this faster, more accurately, and without bias. Clients will expect…

28.11.2025

The rise of the thinking client

For decades, the financial industry has been built around the idea that advisers think and clients follow.The adviser leads the conversation.The adviser defines the agenda.The adviser explains what is happening and what to do next. Clients listen, nod, and hope the advice is sound. AI is turning that model on its head. We are entering the age of the thinking client. Information no longer equals advantage In the past, advisers held the information.Clients had to rely on them to interpret markets, fees, products, and risks. Today, intelligent systems can explain these things instantly, calmly, and without any commercial bias.Which means…

27.11.2025

AI and the re definition of independence

For years, the word independence has been used loosely in financial services.It has been presented as a badge, a marketing line, or a regulatory category. But true independence is none of those things.It is not a status.It is a state of mind. And artificial intelligence is about to expose who genuinely has it. Independence is not about product choice Many firms claim independence because they can access the whole market.But access is not the same as intention. If a firm is driven by:• asset gathering• internal targets• commercial agreements• model portfolios• house views Then the advice is not independent, even…

26.11.2025

How wealth reduces life’s friction, and why that is not always a good thing.

Gwyneth Paltrow once told a simple but revealing story. After winning her Oscar, still young and new to fame, her father looked at her and said in his unmistakable Brooklyn voice,“You are kind of turning into an asshole.” It was his way of saying that fame and money were already starting to change her. Not because she wanted them to, but because they had removed the friction from her life. Suddenly she never had to wait in line, never struggled to book a table, never needed to tolerate the small irritations that shape most people’s daily experience. Everything became easier….

25.11.2025

How Evoa protects against misinformation and financial noise

We live in the loudest financial environment in history.Every day brings a flood of headlines, opinions, forecasts, warnings, and predictions. Markets up.Markets down.New tax rules coming.New economic risks emerging.Investment trends you must not miss. It is constant noise, and most of it is designed to provoke emotion rather than provide clarity. The biggest risk today is not lack of information.It is too much of it. That is why Evoa exists. The danger of reacting to noise Financial noise encourages fast thinking, which is the enemy of good decision making.It creates urgency where none exists.It pressures people to act, to respond,…

25.11.2025

The Wealth Coach model in an AI world

Every technology shift forces an industry to decide what it really stands for.Artificial intelligence is doing that to financial services right now. Some firms will cling to the parts of their model that AI can already do better.Others will rethink their purpose. At The Wealth Coach, we made our choice early.We built our entire model on something AI cannot replace.Clear thinking.Independent judgement.Honest advice. AI does not weaken that model.It strengthens it. Clarity over complexity Many advisers still rely on complexity as a way to justify fees.More products, more charts, more stories. But complexity is the enemy of good advice. It…

24.11.2025

Why active management cannot compete with intelligent insight

Active fund management has always relied on one promise, that human skill can consistently beat the market.It is a comforting idea.It appeals to our desire for certainty and expertise. But the truth is that much of active management has survived not because it works, but because clients could not see the full picture.AI is changing that. The myth of superior judgement Active fund managers present themselves as experts who can outthink the market.But markets are not puzzles waiting to be solved. They are reflections of millions of decisions made by millions of individuals. The idea that one team, or one…

23.11.2025

What AI reveals about overcharging and under thinking

The financial industry has always had two hidden problems.One is obvious.The other is rarely spoken about. The obvious problem is overcharging.The quieter problem is under thinking. AI is about to expose both. The comfort of complexity For years, many firms have relied on complexity as a way to justify fees.The more charts, jargon, and models they presented, the easier it was to claim that deeper expertise was being delivered. Clients trusted what they could not see, and paid for what they could not verify.This is how an entire industry hid average thinking behind confident presentations. AI takes the veneer away….

22.11.2025

The difference between automation and augmentation

Whenever people think about artificial intelligence, the first assumption is that it will automate everything.Automation sounds efficient, and it is, but it also sounds threatening.People fear being replaced. But in financial advice, the real opportunity is not automation.It is augmentation. AI is not here to take away the human role.It is here to strengthen it. Automation removes tasks Automation is simple. It takes jobs that follow rules and does them faster. In finance, that includes:• Data gathering• Calculations• Portfolio rebalancing• Risk modelling• Reporting• Tax projections All of these are important, but none of them require human judgement.They are repeatable processes.And…

21.11.2025

If you would not give £220,000 to your worst enemy, why give it to yourself in the future?

Most people think long term investing is about returns, charts, and probabilities.It is not.It is about behaviour. And one of the most powerful behavioural problems we face is this:We feel nothing about the future. Ask someone what they will need in 20 years and they shrug.Ask them how much money they might miss out on in 2045 and they barely blink. But turn that future loss into a present one, and everything changes. Let me show you what I mean. The maths is simple Let us imagine you want £1,000,000 in 20 years.You have two choices. Bonds returning 4 percent…

20.11.2025

Why national wealth managers never refer clients for independent advice

In medicine, the system is designed around the patient.If you visit your GP and they believe you need specialist help, they refer you.They do not hesitate.They do not protect their own income stream.They do not say, “Stay with us, we can do everything.” Why. Because the principle is simple. The patient’s best interests come first. Now compare that to the world of wealth management. The silence that says everything In my entire career as a Chartered Financial Planner and Chartered Wealth Manager, I have met many advisers and salespeople from national firms.St James Place, UBS, Coutts, Brewin Dolphin, Schroders, and many…

20.11.2025

How Evoa learns from you, not about you

One of the biggest fears people have about artificial intelligence is that it collects information quietly in the background.They imagine a system that studies their behaviour, tracks their preferences, and builds a profile they never agreed to. At The Wealth Coach, we wanted the opposite.Clarity, privacy, and consent. So when we built Evoa, we made a simple guiding principle. Evoa learns from the conversation,not from the person. The difference matters Learning about a person implies storing and analysing their identity, their behaviour, and their private information. That is not what Evoa does. Evoa learns from the structure of the conversation,…

20.11.2025

Who can you really trust for financial advice?

If you asked most people whether financial advice is regulated, they’d probably say yes.And they’d be partly right, but only partly. The truth is that some of the most important financial conversations in your life, including inheritance tax planning, trusts, and business succession, can be offered by almost anyone. Trust firms aren’t regulated.Many advisers are restricted.And plenty of firms promoting “IHT planning” are neither independent nor chartered. It means you can be sold a plan long before you’ve had the right conversation. Why this matters When someone talks confidently about inheritance tax, it’s easy to assume they’re qualified, authorised, or…

19.11.2025

Why national wealth managers will struggle in the age of AI

Every industry faces a moment when its old habits collide with a new reality.For national wealth managers, that moment is arriving faster than they think. Artificial intelligence is not attacking their brand or their size.It is attacking their business model. Scale was once an advantage Large firms built their reputation on size.More advisers, more offices, more products, more research. Scale created trust.Clients assumed bigger meant safer, more advanced, and more capable. But scale only works when the world moves slowly.When information was scarce, national firms controlled the flow. They held the knowledge, the narrative, and the polished story. AI removes…

19.11.2025

Why financial wellness is harder than giving up smoking

Most people understand how to give up smoking.You stop smoking. Simple to say, very difficult to do. A habit has been formed over years. There is routine, emotion, identity and comfort attached to it. Smokers know the long term consequences. They know the risks. They feel the shortness of breath when walking upstairs. They notice the impact on their fitness. They get daily reminders of the cost. They have a feedback loop. And even with all that, many still smoke. Information alone is rarely enough to change behaviour. Now compare this to financial decisions. You can make a poor financial…

18.11.2025

Why consumers need a new kind of understanding

Every profession has moments where the world becomes too complex for the traditional way of doing things. Medicine had it.Law had it.Technology had it. And now, wealth management is having its moment. The financial world has become so full of products, models, acronyms and opinions that most people cannot tell the difference between what is genuinely useful and what is simply noise. The result is predictable: People end up paying for things they do not need, using solutions they do not understand and trusting processes that sound clever but add little value. This is not the client’s fault Most people…

18.11.2025

Journey vs outcomes — What wealth managers do not tell you

If you have ever sat in front of a wealth manager and watched their eyes light up as they describe their process, you will know what I mean when I say this industry loves a good story. Investment committees.Quarterly reports.Risk targeted models.Market insight days.A manager explaining why they increased UK equities from 4 percent to 4.5 percent. It all sounds very impressive. But at some point along the way, something strange happened. The industry became obsessed with the journey, while clients continued to care mainly about the outcomes. Clients want outcomes Ask any sensible person in their fifties or sixties…

18.11.2025

The death of the sales pitch in financial advice

If you have ever sat in a financial adviser’s office and felt a gentle push towards a product, you are not alone. The industry has spent decades wrapping sales in the language of advice. Fund ranges, model portfolios, risk profiles, packaged solutions, all neatly delivered with a confident smile. It felt like guidance, but it was often distribution. That world is beginning to crumble. And it is AI that is quietly taking it apart. The end of the polished pitch AI does not care about products. It does not need commission. It does not have quarterly sales targets. It cannot…

18.11.2025

Are Private Banks running out of road?

Private banks grew on one simple idea. If you give us your money, we will give you our attention. For decades that worked. Clients felt looked after. They had someone to call. They were part of a relationship that felt personal. In many ways it was like a private school. Fewer clients, more time, more care. That intimacy was the selling point. But there was a catch. The relationship was only available if you handed over your assets. Historically this made sense. Private banks made money on deposits and lending margins, so the relationship kept clients close. But as interest…

17.11.2025

When clients lead the conversation, not advisers.

For years, financial advice has been adviser-led. The professional sets the agenda, controls the questions, and frames the answers. The client listens, nods, and hopes it all makes sense. That model is changing. AI is shifting the balance of power. For the first time, clients can enter conversations informed, confident, and curious. They no longer need to accept everything at face value. And that change is long overdue. The imbalance of information Traditional advice relies on an imbalance. The adviser knows more, so the client depends on them for guidance. That dependence creates loyalty, but it also creates vulnerability. When…

17.11.2025

How Evoa helps you think before you act

Most financial mistakes do not come from lack of intelligence, but from acting too quickly. We are emotional creatures. We respond to headlines, to fear, to the pressure of urgency. Yet almost every major financial regret begins with one missing ingredient — reflection. That is what Evoa is built to restore. The gap between thinking and acting In a world of instant information, delay has become a lost art. We are encouraged to act fast, decide quickly, and move before opportunity disappears. But financial wellness rarely comes from speed. It comes from clarity. Whether you are thinking about retirement, inheritance,…

16.11.2025

AI, empathy, and the art of financial coaching

Technology can process logic. It can analyse data, forecast outcomes, and test probabilities. But what it cannot do, at least not yet, is care. That gap between logic and empathy is where true financial coaching lives. Why empathy matters in money Money is rarely just about numbers. It is about security, family, purpose, and sometimes fear. When people make financial decisions, they are not only managing assets, they are managing emotions. Empathy is what connects those two worlds. It allows an adviser to understand not just what a client wants, but why they want it. Without empathy, advice becomes mechanical….

15.11.2025

Why the future of advice belongs to independent thinkers

The future of financial advice will not be built by those who know the most, but by those who can think the best. For too long, the industry has confused independence with inconvenience. It has rewarded scale, not skill, and marketing, not meaning. But as artificial intelligence changes how people access information, the value of independent thinking is becoming impossible to ignore. The illusion of choice Many clients believe they have freedom of choice. They compare a few firms, look at performance tables, and assume competition means independence. Yet most advice still flows from the same business model, sell, manage,…

14.11.2025

Trust, transparency, and the next generation of financial relationships

Trust has always been the currency of advice. People do not buy financial products, they buy the feeling that someone they trust is guiding them. But in a world where information is open, technology is fast, and AI can test every claim, trust is changing shape. It is no longer something you are told to feel. It is something you can verify. The problem with traditional trust For years, trust in financial services has often been one sided. The adviser knew more, the client had to take their word for it, and the system thrived on that imbalance. Firms relied…

13.11.2025

From information to insight, what Evoa is designed to do

Most people believe that knowledge is power. But in the modern world, information is everywhere. Power now comes from understanding, not from access. That is where Evoa begins — at the point where information stops being useful and starts becoming overwhelming. The information trap Financial services have always rewarded people who can talk confidently about data. Charts, benchmarks, performance reports, projections, they all look impressive. But having more data does not mean having more direction. Information on its own rarely helps people make better decisions. In fact, too much of it often causes confusion, not clarity. That is because information…

12.11.2025

Before you talk to anyone about Inheritance Tax Planning, read this

When the Government changes tax rules, the adverts always follow. With new inheritance tax rules coming for pensions in 2027 and the recent introduction of a £1,000,000 cap on Business Relief and Agricultural Relief, the financial world is full of firms promoting inheritance tax planning services. You have probably seen them.Financial advisers, wealth managers, estate planners, trust companies, accountants.All offering “free reviews”, “expert IHT planning”, and “specialist advice”. What most people do not realise is this: Inheritance tax planning is not a regulated service.That means almost anyone can advertise it. Consumers assume that anyone running an advert must be regulated,…

11.11.2025

How AI makes advice more human, not less

Whenever people talk about artificial intelligence, they focus on what it replaces.In finance, that usually means analysts, fund managers, or advisers. But I think they are missing the real story. AI does not remove the human element, it exposes where the human element still matters. Efficiency versus empathy Traditional financial advice has often been presented as a technical service. Risk profiling, asset allocation, performance reports, all the visible machinery of “doing the job.” Yet the parts that truly matter to clients are emotional, not technical.Clarity. Reassurance. Perspective. AI will handle the efficiency. It will process data, monitor markets, and rebalance…

11.11.2025

Why intelligent questions matter more than intelligent algorithms

Everyone talks about the power of AI to give answers.Few stop to ask what happens when no one knows how to ask the right question. That is the quiet danger of progress. The smarter our systems become, the lazier our thinking can get. The illusion of precision Modern finance runs on models, algorithms, and forecasts, all designed to make complex things look simple. But the danger lies not in the numbers themselves, it is in how easily we accept them as truth. Ask a lazy question, get a lazy answer. Is this fund good?Can I retire at sixty?What is the…

10.11.2025

Evoa and the evolution of financial thinking

Most people think artificial intelligence will change what we know.I believe it will change how we think. For decades, financial advice has been built on a blend of information and opinion. You ask a question, an adviser gives an answer, part data, part judgement. Yet over time, those two ingredients blurred. The advice became the information. AI is about to separate them again. The end of muddled advice Professionals, whether advisers, lawyers, or accountants, have always mixed information with advice. It’s not deceit, it’s just how the profession evolved. The client asks, the expert explains, and somewhere between the facts…

09.11.2025

The critical thinking effect: how better thinking leads to better decisions

Every day we are surrounded by information. Opinions, headlines, market updates, investment opportunities — it never stops. Yet the more information we have, the harder it can be to separate fact from fiction. That’s why critical thinking has never been more important. I recently came across a book called The Critical Thinking Effect by Thinknetic. It’s not a financial book, but it captures something essential about decision-making — the ability to pause, think, and question what we are told. This ability, more than any investment product or tax strategy, is what separates good outcomes from poor ones. Thinking clearly in…

08.11.2025

How donating shares can make your giving more tax efficient

Giving to charity is something many people want to do more of, yet few realise that how you give can make a big difference to both you and the cause you support. In the UK, donating appreciated shares directly to a charity is one of the most tax-efficient ways to give. It offers two major tax relief benefits, and for those who hold investments, it can often be far more effective than selling the shares first and donating the cash. The key benefits of donating shares When you donate qualifying shares directly to a UK registered charity, two forms of…

08.11.2025

Why 5 advisers give 5 different answers (And what it means for you)

Most people assume the financial advice profession works like law or medicine. Ask a lawyer the same question and you are unlikely to get five entirely different interpretations of the law. Ask five doctors the same question and you will not receive five unrelated diagnoses. And yet, in wealth management, people routinely do. I recently saw a post that said: “I asked five advisers the same question. I got five different answers… and five different invoices.” It is amusing on the surface, but it highlights something serious.If five advisers give five answers, the problem is not the question.The problem is…

07.11.2025

Why Direct Indexing could be the next big thing for UK investors.

Over the years, UK investors have turned to unit trusts, open ended investment companies (OEICs), and exchange traded funds (ETFs) to diversify their portfolios. These structures have served investors well by providing simple access to markets. Yet as more people seek portfolios that reflect their own values, goals, and tax circumstances, traditional funds can start to feel restrictive. That’s where direct indexing comes in. Direct indexing allows investors to own the individual shares that make up an index rather than buying a pooled fund. It brings together the diversification of index investing with the personalisation of bespoke portfolios. For many,…

07.11.2025

The quiet cost of regret in financial planning

People rarely talk about regret.Not in financial planning, not in life. Yet regret is one of the most powerful forces shaping people’s decisions, or more importantly, their avoidance of decisions. Most individuals do not want to challenge their beliefs. They do not want a second opinion, because a second opinion might confirm a suspicion they have tried to ignore: “Did I make a mistake?” When it comes to national wealth managers, this feeling is more common than people admit. The brand feels comforting. The adviser is friendly. The paperwork looks polished. The story is persuasive. But something feels slightly off.Not…

06.11.2025

IHT on Pensions, what actually happens and your options.

Most people do not realise that pensions, for many years, have sat outside the inheritance tax system. For families with meaningful wealth, especially those with pension funds of £500,000 or more, this has been one of the most powerful planning tools available. That is about to change. From 2027, unused defined contribution pension funds will be drawn into the inheritance tax net. The legislation is not final, but the direction is clear. If you want to protect your family, the time to understand the rules is now, not when your children are dealing with your estate. Here is the important…

06.11.2025

How to invest for your children’s future

Whoever said “the best things in life are free” clearly didn’t have children. They’re wonderful, but they’re also expensive, and that’s before university, first homes, and weddings come into the equation. At some point, most parents want to start putting money aside. The question is, what’s the best way to do it? If you type that into Google, you’ll find plenty of lists, Junior ISAs, Premium Bonds, Trusts, Junior SIPPs , just like Zurich’s article “5 ways to invest in your child’s future.” The difference here is that we’ll start where most guides don’t, with why you’re investing, not what…

06.11.2025

Why second opinions matter in financial planning

Most people get a second opinion when it comes to medical treatment, but rarely for financial advice.Yet the stakes can be just as high. When you hand your financial future to someone else, you are placing extraordinary trust in their judgement. But how do you know whether the advice you have is still right for you? That is where a second opinion can make all the difference. Why people avoid second opinions Many people worry that asking for a second opinion feels disloyal or awkward. Others assume it will simply confirm what they already know. But the truth is, good…

05.11.2025

When to take profits, and when to leave investments alone

“Should I take some profits?”It is one of the most common investor questions, usually asked when markets have been kind for a while. It feels sensible — no one ever went broke taking a profit, as the saying goes. But if you sell too soon, you can quietly strangle your long-term returns. Knowing when to take profits is not about predicting markets, it is about following a process. Why investors take profits too early Humans love to feel in control. Selling after a gain gives a quick burst of satisfaction and the illusion of good timing. The problem is that…

04.11.2025

Inheritance tax myths that cost families money

Few taxes create as much confusion as inheritance tax.People either worry about it unnecessarily or ignore it completely.Both reactions are expensive. Inheritance tax, or IHT, is not a simple “rich person’s problem.” It can affect anyone with a family home, pensions, and savings. But many families end up paying more than they should because of persistent myths that refuse to die. Let’s separate myth from fact. Myth 1: “My estate isn’t big enough to pay IHT” You might be surprised.The IHT threshold — known as the nil rate band — has been frozen at £325,000 since 2009.Add in property growth…

03.11.2025

Selling your business in 24 months, your financial planning timeline

Selling a business is often the most significant financial event of your life. It represents years, sometimes decades, of effort and risk.But the difference between a good sale and a great one often lies not in the price you achieve, but in the planning you do before it happens. If you expect to sell your business in the next 24 months, the time to prepare is now. The 24-month window The next two years can shape your financial future for decades to come.A structured plan allows you to: Optimise tax reliefs such as Business Asset Disposal Relief Secure your personal…

02.11.2025

Estate planning for blended families, getting the basics right

Modern families rarely fit a simple template. Second marriages, stepchildren, and changing relationships are now the norm, not the exception.That makes estate planning more important — and more complicated — than ever. Blended families often face competing priorities, emotional as well as financial. Without a clear plan, good intentions can quickly turn into confusion or conflict. Why blended families need extra care In a traditional setup, your will might leave everything to your spouse, then to your children. In a blended family, that approach can easily create tension. For example, if you leave everything to your new spouse outright, your…

01.11.2025

Investor biases that cost you money, and how to fix them

Investing is not just about numbers, it is about behaviour.Markets move on data, but investors move on emotion.And those emotions can quietly erode your returns over time. You can have the perfect plan, but if your behaviour fights it, the plan loses.That is why understanding investor biases matters as much as understanding markets. What we mean by “bias” A bias is a mental shortcut — something the brain uses to save time when making decisions.In everyday life, shortcuts help. But when it comes to investing, those shortcuts can lead to poor choices, because they rely on instinct, not evidence. The…

31.10.2025

20 questions to ask before you hire a financial adviser

Choosing a financial adviser is one of the most important financial decisions you will make.Yet most people spend more time comparing restaurants than comparing advisers. A confident adviser will welcome good questions. A poor one will avoid them.These 20 questions are designed to help you separate the two. About their independence and structure Are you independent or restricted?This determines whether the adviser can access the whole market or just a limited range. Who owns your business?If it is part of a larger national group, incentives may differ from a genuinely independent firm. Do you have shareholders or sales targets?Advisers accountable…

30.10.2025

Restricted vs independent advisers, what’s the difference?

When you first meet a financial adviser, you might assume all advisers are the same. They all seem to offer similar services, often with reassuring words like “trusted,” “experienced,” and “bespoke.” But in the UK, there is one question that cuts through all the marketing, are you independent or restricted? The answer changes everything about how that adviser works, and how they are paid. What “independent” really means An independent financial adviser (IFA) can recommend products and providers from across the whole of the market. They are not tied to a particular firm, platform, or fund range. This means their…

29.10.2025

What good financial advice costs, and what you should get for it

Money and trust go hand in hand, which is why the question “what does financial advice cost?” can feel awkward to ask. Yet it is one of the most important questions you can raise. In the UK, advice fees can vary widely. What matters is not just the cost, but what you get for it. How advisers charge There are three main ways advisers charge for their services: 1. Percentage-based feesA percentage of the money you invest, often around 1% a year.The problem is that the more you have, the more you pay, even if the work involved does not…

28.10.2025

The cash-bucket strategy, calm withdrawals in any market

When you stop working, your focus shifts from building wealth to using it wisely. The challenge is simple to describe but hard to live with, how do you take a steady income from investments that move up and down every day? That is where the cash-bucket strategy comes in. It is a simple, time-tested approach that helps you draw income calmly, without panic when markets fall. The problem it solves When markets fall, selling investments to fund income can lock in losses.If that happens early in retirement, it can permanently damage your portfolio, a risk known as the sequence of…

27.10.2025

Check your State Pension forecast and fill gaps

The State Pension might not be glamorous, but it is one of the most valuable income sources in retirement.It provides a secure, inflation-linked income for life, which is hard to replicate elsewhere. Yet many people have no idea how much they are due to receive, or whether they could improve it.Checking your State Pension forecast is quick, simple, and could add thousands to your retirement income. Why the State Pension matters Unlike personal or workplace pensions, the State Pension does not depend on markets. It is paid for life and increases each year under the triple lock, which protects it…

26.10.2025

Capital gains basics, using allowances and wrappers efficiently

Capital gains tax, or CGT, sounds technical, but the concept is simple. When you sell an investment or asset for more than you paid, the profit is a capital gain. If it falls outside your tax-free allowance, you may owe tax on the profit. It matters because as your wealth grows, small adjustments in how you manage gains can make a big difference to your long-term returns. What is capital gains tax? You pay CGT when you sell or dispose of assets that have increased in value. That could include: Shares, funds, or ETFs held outside an ISA or pension…

25.10.2025

Service or sale? The difference between helping and harvesting

We use the word “service” too casually in financial advice. Most people assume their adviser is there to help. But often, the structure of the industry makes that impossible. Many wealth managers describe themselves as “being of service”, but only if you invest through them. If you take their advice and walk away, there’s often nothing left. That’s not service, that’s a transaction with polite manners. True service is unconditional. It’s based on honesty, not dependency. It exists whether or not you buy a product. Here’s a simple test: if you removed the investments, would there still be value? Would…

24.10.2025

Paying yourself, salary, dividends, and pension contributions for company directors

If you are a company director, you have more control than most over how you take income. That flexibility can be a powerful advantage, but it also makes things more complex. The question is not just how much to pay yourself, but how to pay yourself, balancing salary, dividends, and pension contributions to optimise both personal and company finances. Let’s explore how to make the numbers work sensibly. Why structure matters Every pound your business earns can either stay in the company or come to you personally. How and when you move that money affects income tax, corporation tax, and…

24.10.2025

Why comfort wins (until it doesn’t)

I recently asked a question on LinkedIn: Would you rather know the truth about how your money is managed, or stay comfortable believing the story you’ve been told? One reply stood out. A gentleman from Herefordshire said, “Most people would want to stay comfortable.” I think he’s right. If you’ve ever seen The Matrix, you’ll remember the scene where Morpheus offers Neo two pills. A blue pill or a red pill. Take the blue pill, and you stay in the world you know. Safe, familiar, unchallenged.Take the red pill, and you see how the world really works. It’s uncomfortable, but…

23.10.2025

SIPP consolidation checklist, move or keep separate

Over a long career, it is easy to collect a few different pensions. You might have one from each job, one from your own business, and perhaps a personal SIPP you opened yourself. Before long, you can find yourself managing several pots, platforms, and logins. It feels untidy, so the question naturally follows, “should I combine them?” Consolidating pensions can simplify your finances, but it is not always the right move. Here is how to decide. Why people consolidate pensions The main reasons are convenience, clarity, and cost. Convenience, fewer statements and simpler administration Clarity, a single view of your…

23.10.2025

Inflation is steady, but your cash isn’t.

Inflation held steady at 3.8% in September, according to the latest ONS figures. Food prices are rising more slowly, and headlines sound calm for once. But for anyone sitting on large cash balances, that calm is deceptive. Most savings accounts pay around 2% interest, and even the better ones struggle to beat 4%. After tax, the real return is negative. On paper, cash feels safe. You can see it, count it, and know it’s there. But inflation quietly eats away at its value. At 3.8%, £100 today will buy only £81 in ten years. That’s the cost of comfort, the…

22.10.2025

The seven-year rule on gifts, a plain English guide

The seven-year rule is one of the simplest and most misunderstood inheritance tax rules in the UK. People talk about it as though everything magically disappears after seven years, but that is not quite true. If you want to pass on wealth to family during your lifetime, it is worth understanding how the rule really works, what counts as a gift, and when it applies. What the seven-year rule means The idea is straightforward. If you make a gift to someone and survive for seven years, that gift is usually outside your estate for inheritance tax purposes. These are called…

22.10.2025

Gifting vs trusts, choosing a route for family wealth

Passing on wealth to family is one of the most common financial goals, yet it is also one of the most misunderstood. Many people assume that setting up a trust automatically saves tax or that making a gift is simple and consequence-free. In reality, both gifting and trusts can be effective tools, but they serve different purposes. Choosing between them is not about which one sounds more sophisticated, it is about control, access, and timing. Why people gift or use trusts The motivations are usually similar. Parents or grandparents want to: Help children with property or education costs Reduce future…

21.10.2025

ISA vs pension, which should I fund first

When it comes to saving and investing, two of the most powerful tools you have are ISAs and pensions. Both give tax advantages, both can help you build wealth efficiently, and both play different roles in your financial plan. The question many people ask is, “which one should I fund first?” There is no single right answer, but understanding the trade-offs will help you make the right choice for your life, not just for your tax return. The simple view If you need flexibility, the ISA wins. If you want tax relief and long-term discipline, the pension wins. Most people…

20.10.2025

Pension tax-free cash myths, what you can and cannot do

For many people, the most exciting part of retirement is the moment they can finally access their pension tax-free cash. It often feels like a reward for years of saving. But this part of the system is also one of the most misunderstood. You can usually take up to 25% of your pension as tax-free cash, but how and when you take it makes a big difference to how long your money lasts and how much tax you eventually pay. Let’s clear up some of the biggest myths. Myth 1: You must take all the tax-free cash at once You…

19.10.2025

Sequence of returns risk, how to protect your retirement income

When markets fall just after you retire, the damage can be greater than you expect. You might still have the same long-term average return, but the order in which returns happen, the sequence of returns, can make or break your retirement plan. It is one of the least understood risks in retirement, yet it can have the biggest impact on whether your pension lasts. What sequence of returns risk really means Imagine two retirees, both with £500,000 invested and both taking £20,000 a year. They achieve the same average annual return of 5% over 20 years, but one starts with…

18.10.2025

Pension drawdown vs annuity: which fits your retirement plan

Choosing how to take an income from your pension is one of the biggest financial decisions you’ll ever make. Once you’ve finished saving, the question becomes how to turn your pension into a reliable income, and that usually comes down to two options: pension drawdown or an annuity. Both have their place, and both can work well when used properly. The challenge is knowing which one, or which mix, suits your life, your family, and your goals. What pension drawdown means Drawdown allows you to keep your pension invested and withdraw money as you need it. Think of it like…

17.10.2025

Should you apply for a transitional tax-free amount certificate?

(And why most people don’t know whether it even matters to them) When the Lifetime Allowance (LTA) was abolished in April 2024, it seemed like a relief. One less tax to worry about, right?Well, not quite. The LTA has been replaced by two new limits,The Lump Sum Allowance (LSA), which determines how much tax-free cash you can take in total,and The Lump Sum and Death Benefit Allowance (LSDBA), which limits how much can be paid tax-free to your beneficiaries. And here’s the catch,If you took pension benefits before April 2024, the tax-free cash you already took affects how much of…

16.10.2025

How you can avoid overconfidence in Wealth Management

Decision-making plays a huge role in our daily lives, from choosing what to have for dinner to making important financial choices. Daniel Kahneman, a psychologist and Nobel laureate in economics, has greatly shaped our understanding of how we make decisions, particularly through his work on cognitive biases and his theory of prospect theory. Understanding how we make decisions can help us make better choices, especially when it comes to managing money. The overconfidence bias: When too much confidence leads to mistakes One of Kahneman’s key findings is overconfidence, when we believe we know more than we actually do. This often…

16.10.2025

Second opinion: Want it? No. Need it? Yes.

Nobody really wants to be told they’re wrong. It’s uncomfortable, inconvenient, and even worse when it’s about something important, like your money. So when it comes to asking for a second opinion on financial advice, most people quietly avoid it. Because what if it turns out the advice you’ve been following wasn’t right? What if the adviser you’ve trusted wasn’t the best fit? That’s not an easy thought to invite. Comfort feels safer than truth There’s a strange thing about human nature, we often prefer the story that keeps us comfortable over the truth that makes us think. It’s the…

15.10.2025

Can paying for a big family holiday help with IHT?

Inheritance tax (IHT) planning often brings up creative ideas, but here’s an interesting one: Can paying for a big family holiday help with IHT? Typically, if you give family members money for a trip, it’s considered a “potentially exempt transfer” (PET). This means IHT could apply if you pass away within seven years. But what if you, as the donor, pay for the holiday directly? IHT is based on the loss to the donor’s estate. When someone makes a gift, the value of their estate decreases, which could trigger IHT. However, the idea of “disposition,” or transfer of value, is…

15.10.2025

Why divorce changes your will, and what to do about it

Divorce is one of life’s biggest resets. It reshapes your finances, family life and often how you see the future. But there is one area that most people forget to revisit, what happens if you die afterwards. When you divorce, your will does not automatically disappear. It stays valid right up until your final order, and even while you are separated, your existing will continues to take effect. That means if your spouse is still named in it, they could still inherit until the divorce is finalised. Once the divorce is complete, things change. Any gift to your former spouse…

14.10.2025

I’m thinking of selling my business.

Selling your business and retiring to a sunny beach is the dream for many owners. But time and time again, I see business owners make the same avoidable mistakes when it comes to the sale. If you’re thinking about selling your business in the next few years, here are 6 key traps to steer clear of: Leaving tax planning too late Most owners wait until they have a buyer lined up before thinking about tax, and by then, it’s too late for many of the best strategies. Once a Heads of Terms or similar agreement is signed, your options shrink…

14.10.2025

AI economics, why agencies want Tillys, not Emilys

Why would a talent agency consider signing an AI actress like Tilly Norwood? The economics are clear. She’s cheap, compliant, and controllable. She doesn’t need rest, royalties, or red carpets. Emily Blunt is a world-class actor. But to a studio executive running the numbers, Tilly looks tempting. National wealth managers think the same way. Thousands of their advisers are really salespeople acting as advisers, a performance designed to win trust. But AI can act too. It can follow a script, map client risk, and churn out recommendations at a fraction of the cost. From a firm’s perspective, that’s attractive. But…

14.10.2025

Business Relief reform: The next scandal in waiting?

In recent weeks, there has been growing noise about the future of Business Relief (BR) and how it applies to certain investment schemes, particularly unquoted Inheritance Tax (IHT) portfolios. At first glance, BR looks like a useful way to reduce IHT exposure. But when tax rules drive investment decisions, history tells us that the story rarely ends well. The warning signs An article from Citywire recently suggested that the Treasury is “looking at levelling unlisted and AIM IHT portfolio relief.” In plain terms, that means the government may be preparing to reduce or remove IHT relief for some of these…

13.10.2025

“In shaky times, investors should hold their nerve”…but should you?

I recently came across an article by a fund manager titled “In Shaky Times, Investors Should Hold Their Nerve.” It is a phrase that often circulates in the investment world. It sounds wise, calm, and reassuring. But the real question is this, does it apply to every investor? Let us imagine a simple world with just 100 fund managers, each offering one fund. Over time, performance tables emerge. Some funds perform well, others do not. If you happen to be invested in one of the top performers, then perhaps “holding your nerve” makes sense. But what if your fund sits…

13.10.2025

The “Authenticity Gap” — Tilly Norwood vs real human advice

Scroll through Tilly Norwood’s Instagram and you’d think she was the next breakout star. Glamorous headshots, comedy sketches, even a fake appearance on Graham Norton’s sofa. But she isn’t real. She’s an AI creation. Actors like Emily Blunt are alarmed. They know that true performance isn’t just appearance. It comes from lived human experience, joy, grief, struggle, triumph. Audiences may be fooled for a moment, but authenticity always shines through. Wealth management has its own Tilly Norwoods. National firms present advisers who look polished, sound confident, and deliver slick presentations. But many of them aren’t advisers at all, they’re salespeople…

12.10.2025

Do advisers invest the same way they recommend to clients?

You might assume that financial advisers invest their own money in exactly the same way they recommend to clients. In practice, many don’t, and that raises important questions about incentives and trust. When you hire a financial adviser or wealth manager, you’re putting faith in their strategy. But here’s a truth that doesn’t get talked about often: many advisers don’t follow their own advice. 1. Active vs passive — watch the gap Plenty of firms promote expensive, actively managed funds to clients. Yet, when you look at what the fund managers themselves invest in, many prefer low-cost, passive index funds…

10.10.2025

AI and redundancy — what Tilly Norwood means for wealth managers

Tilly Norwood looks like any other actress trying to break into Hollywood. But Tilly isn’t real. She’s an AI creation, and her arrival has rattled the acting world. Stars like Emily Blunt are worried. Will Tilly replace her? Probably not today (perhaps tomorrow.) More likely is that the next generation of Emilys may never get a chance to start. The fear is not just of being replaced, but of being shut out before a career even begins. Wealth management faces the same challenge. Large firms employ thousands of so-called advisers. In truth, many are salespeople acting as advisers. That’s the…

09.10.2025

What’s the value of financial wellness vs. just investment advice?

Investment advice helps you pick funds and manage portfolios. Financial wellness goes further; it’s about clarity, confidence, and control over your whole financial life, not just the numbers on a statement. Most people assume financial advice means one thing: investments. What fund should I be in? Should I move my ISA? How’s the market doing? Important questions, but not the whole picture. Investments are just one part of your financial life. Wellness is about the whole. 1. Investment advice: the narrow view Traditional investment advice focuses on: ~Choosing funds or managers ~Balancing portfolios ~Chasing returns That has value, but it…

09.10.2025

Trusting a brand vs trusting a person

We buy almost everything online now — from groceries and clothes to savings accounts and investment platforms. The internet has made everything easier, but it’s also made everything easier to imitate. Scammers don’t just copy small, unknown firms. They copy the big ones, the national names, the household brands. Because they know how powerful familiarity feels. That’s the problem. Familiarity feels like safety. But feeling safe and being safe are not the same thing. The comfort of the familiar When investors see a well-known name, they instinctively relax. They assume that size means safety, that national presence means credibility, and…

08.10.2025

Is a £21 bottle of wine three times better than a £7 one?

If you buy a £7 bottle of wine, is a £21 bottle three times as good? Three times as tasty? It’s been said that: Expensive wines are enjoyed more by wine enthusiasts. Expensive wines are enjoyed slightly less by non-enthusiasts. So, if you know more about wine, you’ll likely appreciate it more. You’ve invested time, energy and curiosity into something — and you get more out. “In a sample of more than 6,000 blind tastings, we find that the correlation between price and overall rating is small and negative, suggesting that individuals [without wine training] on average enjoy more expensive…

08.10.2025

What does “risk” really mean in investing?

In investing, “risk” isn’t just about losing money. It’s about the uncertainty of outcomes, the trade-off between risk and reward, and how much volatility you can realistically live with. Most investors think of risk as a simple scale: low, medium, or high. But real risk is far more complex and far more personal. 1. Risk is uncertainty At its core, risk is about not knowing exactly what will happen. Markets rise and fall, interest rates change, governments rewrite tax rules. The future is uncertain, and investing means accepting that uncertainty. 2. Volatility vs permanent loss Volatility is when your investments…

08.10.2025

Slow thinking saves fortunes

We all like to think we make rational financial decisions. But the truth? Most of us don’t. Daniel Kahneman, in his brilliant book Thinking, Fast and Slow, discovered that our brains run on two systems. System 1 is fast, instinctive, emotional. It’s the part that keeps us safe when crossing the road or reacting to danger. System 2 is slow, deliberate, and logical. It takes effort. It demands focus. Both systems are essential, but not for the same things. And when it comes to money, most people rely far too much on System 1. The emotional sell Ever wondered why…

07.10.2025

Wine, art, cars, coins, watches, diamonds…

Perhaps the most traditional way to invest in real assets is to buy an investment property. Many investors feel comfortable with property because it’s something tangible. You can visit it, you can touch it, and you can see its value. But property isn’t the only real asset people invest in. Art, classic cars, and fine wine have all become popular ways to diversify portfolios — and, for some, to combine passion with profit. The Allure of Tangible Investments According to Knight Frank, over the last ten years, classic cars have risen by 334%, while fine wine is up 192%. In…

07.10.2025

How do emotional biases influence investment decisions?

Emotions play a bigger role in investing than most people admit. Biases like fear, greed, and overconfidence can quietly steer decisions, often to the investor’s detriment. Recognising these biases is the first step to financial wellness. Investing is often described as rational: numbers, charts, and data. But in practice, most investment decisions are driven by human behaviour. Markets rise and fall, and so do our emotions. 1. Loss aversion Psychologists have shown that people feel the pain of losses about twice as strongly as the pleasure of equivalent gains. This leads to: ~Selling investments too quickly when markets fall ~Holding…

07.10.2025

Who is the ideal client for a Wealth Manager?

If you ask a typical wealth manager who their ideal client is, the answer is simple: Someone who has £10 million, rents their home, invests every penny with them, and never asks too many questions. That is the dream. Now, let’s add some reality. Suppose you own your main residence worth £2 million. That leaves £8 million for them to manage. Still good business, but not quite perfect. What if your wealth is spread more broadly? Perhaps you own more than one property, invest in classic cars, art, or gold. Maybe you hold some private equity or still run your…

06.10.2025

Investing in your children’s financial wisdom

We spend decades learning how to create wealth, but very few of us ever stop to ask whether our children are ready to inherit it. When families talk about succession planning, the focus usually lands on wills, trusts and tax. These are important, but they are not the real challenge. The real challenge is preparing the next generation to handle the responsibility that comes with wealth, emotionally, practically, and wisely. Why inheritance often fails It is well known that most family wealth does not survive beyond the third generation. It is not because the lawyers or accountants got it wrong,…

06.10.2025

What is financial coaching, and do I need a coach rather than a planner?

Financial coaching helps you change how you think and behave with money, while financial planning helps you structure and manage it. Both can be valuable, but they serve different purposes. When people hear “financial advice,” they often think of products: pensions, ISAs, investments. But money decisions aren’t just technical. They’re emotional. That’s where financial coaching comes in. What is financial coaching? A financial coach focuses on you, not just your money. They: ~Explore your attitudes and behaviours around money ~Help you set meaningful goals ~Challenge unhelpful habits (like overspending or over-saving) ~Build confidence in financial decision-making Think of it as…

06.10.2025

Wealth management & the “Dead Horse” theory

In life, we all face moments when we are riding a dead horse. No matter how much effort we put in, the horse is not moving forward. Wealth management and investing are full of examples where investors and advisers continue to cling to what no longer works. The Dead Horse Theory is a satirical way of exposing the absurd behaviours we fall into. Instead of accepting reality, we invent ways to avoid it. Changing the jockey, not the horse Investors replace one fund manager with another, believing fresh leadership will solve the problem. Yet the system itself is flawed. The…

03.10.2025

Why do wealthy families often get estate planning wrong?

Wealthy families usually have good intentions when it comes to estate planning, but many still get it wrong. The result? Higher taxes, unnecessary costs, and wealth that doesn’t end up where it was intended. At first glance, it doesn’t make sense. Families with millions in assets, access to advisers, and the ability to plan ahead should have estate planning nailed. Yet time and again, we see mistakes that cost hundreds of thousands, sometimes millions. Why? 1. Overconfidence Wealth often breeds the assumption that “we’ve got it covered.” A will drafted years ago, or advice taken once, is treated as permanent….

03.10.2025

How can I plan my inheritance to minimise IHT legally?

Inheritance Tax (IHT) in the UK is charged at 40% on estates above the available allowances. With good planning, you can often reduce or even avoid unnecessary tax, but the key is to act early and within the rules. No one likes to think about inheritance tax, but for many families, it’s one of the biggest financial risks they face. Property prices, pensions, and investments can quickly push estates above the £325,000 nil-rate band (or £500,000 if you qualify for the residence allowance). The good news? There are clear, legal ways to minimise the impact. 1. Use your allowances Each…

02.10.2025

Can you prove your investments are really OK?

I often hear people say, “My investments are OK.” It sounds reassuring, but it isn’t proof. If your investments were on trial tomorrow, and you had to stand in front of a judge and jury, could you actually prove they were OK? Could you show, with evidence, that: You understand the level of risk you are taking? You’re not paying more in hidden charges than you should? Your returns are being measured against the right benchmark, not a convenient one? You have a clear plan for what happens when markets fall? Most investors would struggle under that kind of cross-examination….

02.10.2025

Do I need a Family Investment Company (FIC)?

An FIC is a private company, usually set up by parents, to hold family wealth (investments, property, or cash). Shares in the company are then given to children or held in trust, allowing wealth to pass down while parents keep control as directors. Potential advantages ~Control – parents can stay in charge of investment and distribution decisions, even after gifting shares. ~Tax efficiency – companies pay corporation tax (currently lower than higher-rate income tax), which can help investments grow more efficiently. ~Succession planning – shares can be passed gradually to children, spreading inheritance tax exposure. ~Flexibility – unlike some trust…

01.10.2025

Feeling fine vs being fine — The illusion of OK

Investing is a lot like visiting the doctor. You might feel fine, but your doctor still insists on tests. Blood pressure, blood tests, scans. Why? Because “feeling fine” isn’t proof you are fine. The same is true of your investments. People often tell me, “They’re OK.” But when pressed to prove it, most can’t. They don’t know the exact risks they’re carrying. They can’t show the true costs they’re paying. And they rarely measure performance properly. This is where a lot of investors trip up. They confuse comfort with correctness. They assume that because a decision feels right, it must…

30.09.2025

Warren Buffett’s $347 billion question: How much cash do you hold?

Warren Buffett’s company, Berkshire Hathaway, is sitting on an eye-watering $347 billion in cash as of July 2025. That is not just a record for Berkshire, it is more than the combined reserves of Apple, Microsoft, Alphabet, Amazon, and NVIDIA. Yes, one company has more cash than the five tech giants everyone thinks of as unstoppable money-making machines. But here is the interesting part: much of this is not sitting in “cash equivalents” like money market funds or short-term corporate bonds, it is in good old U.S. Treasury bills. In other words, the safest, most liquid option out there. Why…

30.09.2025

The “Green Box” that saves your loved ones time, stress and headaches

Most of us don’t want to think about what happens after we’re gone. But here’s a simple exercise that gives your family clarity, reduces confusion, and spares them having to assemble a million puzzle pieces. Call it the Green Box (or whatever colour works for you). The purpose is this: Put everything your family will need to manage your affairs in one place, ideally a single labelled box or folder, so they know exactly where to look. Michael Girdley originally popularised this concept in his post “The Green Box Your Family Will Thank You For” Here’s how you can build…

30.09.2025

What are the consequences of poor estate planning?

Poor estate planning doesn’t just cost money; it costs time, creates stress, and can even damage family relationships. The consequences range from unnecessary tax bills to outright legal disputes. Most people think estate planning is about writing a will and ticking a box. In reality, it’s about making sure your wealth is transferred smoothly, fairly, and tax-efficiently. When it isn’t, the fallout can be huge. 1. Unnecessary inheritance tax Without proper planning, families can hand over 40% of their estate to HMRC unnecessarily. Missed allowances, poorly structured assets, and outdated wills are common causes of excessive IHT bills. 2. Costs…

30.09.2025

When your financial adviser sells out: What it means for you

Imagine this: you’ve spent years building a relationship with your financial adviser. They know your family, your quirks, your fears, and your goals. Then one day, you get a letter or email—your adviser’s firm has been bought out. Suddenly, you have a new adviser. Not one you chose, but one you’ve been assigned. This isn’t rare. In fact, it’s happening everywhere. According to Citywire (early 2025), more than 6,000 financial advisers in the UK now work for private equity–backed firms. That’s 17% of all advisers—double the number just a year ago. So, what does this mean for you? Private Equity’s…

29.09.2025

Is setting up a trust always a good idea?

Trusts can be powerful tools for estate planning, but they’re not a magic bullet. Many families set them up expecting big tax savings or simple solutions, only to discover costs, complexity, and in some cases, no real benefit at all. For centuries, trusts have been used to protect family wealth, provide for children, and manage succession. Done well, they can still achieve those aims. But in the UK today, trusts are often oversold, and under-reviewed. 1. The promise vs the reality Advisers or lawyers may promote trusts as a way to: ~Reduce inheritance tax (IHT) ~Protect assets from care fees…

29.09.2025

What are the hidden pitfalls of passing on unused pensions at death?

For years, pensions were seen as the most tax-efficient way to pass wealth to the next generation. But the rules are changing, and there are pitfalls many families overlook, from inheritance tax (IHT) exposure after 2027 to poor beneficiary planning. It’s easy to think of pensions as the “perfect inheritance vehicle.” They sit outside your estate, grow tax-efficiently, and can be passed on flexibly. But even before the 2027 changes, there are traps to be aware of when leaving pensions untouched. 1. Inheritance tax after 2027 From April 2027, unused pensions will normally fall within IHT. That means up to…

26.09.2025

The ‘Red Pill’ or the ‘Blue Pill’?

In our boardroom, there’s a picture that always sparks conversation: the red pill and the blue pill from The Matrix. The choice is simple. ~The blue pill is comfort, denial, and carrying on as normal. ~The red pill is reality, the truth, even if it’s uncomfortable. Let me put it another way. Imagine discovering your partner has been cheating. How would you feel? Now imagine you didn’t know, but everyone else did. Would you want someone to tell you? Or would you prefer to carry on in blissful ignorance, never asking the harder questions? This is the heart of the…

25.09.2025

Should I transfer my pension into a trust?

With pensions set to fall into inheritance tax (IHT) from 2027, some families are asking whether they should move their pension into a trust. In most cases, the answer is no, because pensions are already one of the most tax-efficient vehicles you can hold. Trusts can be powerful tools in estate planning. They can help control how wealth is passed on, provide protection for vulnerable beneficiaries, and offer some tax advantages. But pensions are not like other assets. They already sit outside your estate (until 2027), grow tax-efficiently, and can usually be passed on flexibly to beneficiaries. Moving them into…

25.09.2025

Why “Big” doesn’t mean “Safe” in wealth management

Visit any national wealth manager’s website and you’ll see the same kind of boasts: ~“We look after thousands of clients.” ~“We manage billions of pounds in assets.” ~“Join the many who trust us with their wealth.” On the surface, it’s reassuring. If so many others are investing with them, they can’t all be wrong. Being part of something large must mean security… right? Not quite. The illusion of safety These messages are designed to make you feel comfortable. To tell you: you’re not alone, you’re in good hands, follow the herd. But look closer and you’ll notice what’s missing: they’re…

25.09.2025

The 5 questions big wealth managers don’t want you to ask

Big wealth managers love to talk about how many clients they have, how many billions they look after, and how brilliant their track record is. What they don’t love is when clients ask the harder questions. Why? Because the answers can reveal a lot about how they really operate. Here are five questions worth asking and why they matter. 1. Are you independent or restricted? Most national wealth managers are restricted, meaning they can only recommend products from a set menu. Independent advisers can search the whole market. If they are restricted, the real question is: are you recommending this…

24.09.2025

What’s the best way to take tax-free cash from my pension?

In the UK, you can usually take up to 25% of your pension pot as a tax-free lump sum. The question isn’t just “how much can I take?” but “how should I take it?” because timing, tax rules, and your long-term plans all make a big difference. For many people approaching retirement, the tax-free cash (often called the “pension commencement lump sum”) feels like a milestone. After years of saving, here’s a reward: a chunk of your money, tax-free. But how and when you take it matters more than most realise. 1. You don’t have to take it all at…

24.09.2025

When tax saving becomes too tempting

Imagine this conversation: Advisor: “We can help you save on taxes.” Footballer: “That sounds great, but are you sure it’s all legal and above board?” Advisor: “Don’t worry. Worst case, you just end up paying the tax you owe anyway. So, what’s the risk?” Footballer: “Well, if you think it’s worth trying, let’s go for it.” Sounds harmless enough, right? But let’s reframe it: Advisor: “We can help you save on taxes.” Footballer: “That sounds great, but is this really legal and above board?” Advisor: “If it works, you’ll save money. But if it fails, you could end up in…

24.09.2025

Why national wealth managers put themselves first.

When you go to the doctor, you don’t wander into a glossy national chain. You go to a local practice. Why? Because medicine isn’t about branding, it’s about trust. It’s about sitting across the table from someone who knows you, listens to you, and has no hidden agenda beyond your health. We intuitively accept this in medicine. But when it comes to money, many people hand over their financial lives to national wealth managers or private banks, thinking they’ll get the same relationship of trust. The truth is far less comforting. The “subject to” trap National firms are very good…

23.09.2025

How much pension should I leave to avoid estate tax surprises?

From 2027, pensions will come into the inheritance tax (IHT) net. For families with large pension pots, that raises a new question: how much is “safe” to leave behind before HMRC takes a share? The answer isn’t a single number, it depends on your overall estate, your age, and your planning. For years, pensions were seen as the “perfect inheritance vehicle.” They sat outside of IHT, making them more tax-efficient to pass on than property, ISAs, or cash. But from April 2027, the rules are changing. Unused pensions may now be subject to 40% IHT on death. That doesn’t mean…

23.09.2025

Don’t make life harder for your executors: The coming Inheritance Tax Changes

Inheritance tax is already one of the most complicated parts of our system. Now, from April 2026 onwards, draft changes mean your personal representatives (the executors of your will) are likely to face even more responsibility and paperwork. If you don’t prepare, you risk leaving your loved ones with extra stress, bigger bills, and tighter deadlines at an already difficult time. What’s changing? The government has published draft rules that will affect three key areas: Business & Agricultural Property Relief (BPR/APR) ~Up until now, many family businesses and farms got 100% relief from inheritance tax, with no upper limit. ~From…

22.09.2025

How will the 2027 pension and inheritance tax changes affect me?

From April 2027, pension death benefits will be brought into the scope of inheritance tax (IHT). For many families, this changes the long-held view of pensions as a completely tax-free inheritance vehicle. The good news? With the right planning, most people can still manage the impact. For years, pensions were seen as the perfect way to pass wealth down a generation: ~No inheritance tax on death ~No income tax if beneficiaries were under 75 ~Flexible access for beneficiaries That’s changing. The government has confirmed that from 2027, unused pensions will normally be subject to IHT when passed on. What this…

22.09.2025

Curiosity: A powerful tool for financial wellness

Curiosity doesn’t get enough credit in the world of money. People talk about discipline, patience, even bravery when markets wobble. But curiosity? It’s rarely mentioned. Yet in my experience, curiosity is the quiet superpower behind good financial decisions. It’s what separates those who drift along with assumptions from those who actually understand what’s going on with their money. Let me explain. Curiosity stops you from settling for the obvious When negotiating a deal, reviewing an investment, or even speaking with a financial adviser, most people accept what’s put in front of them. They ask a few surface questions, nod, and…

20.09.2025

Retirement spending: Is 4.7% the new 4%?

For years, the “4% rule” has been the go-to idea in retirement planning. The rule of thumb was simple: take 4% of your pot in year one, adjust for inflation each year, and you should be fine. But William Bengen, the man who created the rule, has just updated his thinking. He now suggests 4.7% might be safe. Good news? Maybe. But before you start celebrating, let’s unpack it for the UK. Why the change? Bengen’s research now includes more data, more diversified portfolios, and more realistic assumptions. Instead of just US large-cap shares and bonds, he’s factored in small-caps,…

19.09.2025

What makes a good wealth manager for high-net-worth families?

A good wealth manager for high-net-worth families isn’t just someone who manages investments. It’s someone who helps you make sense of your total wealth, your pensions, tax, estate, business, and family goals, with independence, strategy, and trust at the core. If you’ve built significant wealth, you already know that money brings complexity as well as opportunity. Family businesses, multiple properties, pensions, trusts, and investments all create moving parts. So what makes a good wealth manager for high-net-worth families? Here are the qualities that matter most. 1. Independence and objectivity Big-name firms often operate on a restricted basis, meaning they can…

19.09.2025

How does cost impact long-term investment returns?

In investing, cost isn’t just a line on a statement; it’s one of the biggest factors that determines how much money ends up in your pocket. Even small differences in fees compound into huge gaps over time. Most investors focus on returns. “Did I make 7% last year? 10%?” But the quieter, more consistent drag on your wealth is cost. Unlike markets, which you can’t control, fees are certain. And the longer you invest, the more those costs eat into your future. 1. The compounding effect of fees A 1% annual fee might not sound like much. But over 20…

18.09.2025

How do I evaluate the performance of my investment portfolio objectively?

The true test of an investment portfolio isn’t whether it “feels” like it’s doing well; it’s whether it delivers, after costs and risk, against a clear benchmark. Evaluating performance objectively means looking beyond headlines and gut instinct. Most investors glance at their portfolio once in a while, nod if the number looks bigger than last year, and move on. But that’s not evaluation, that’s wishful thinking. If you want to judge performance properly, here’s what really matters: 1. Compare against the right benchmark Looking at a 5% return might feel good. But if the market grew by 10% over the…

17.09.2025

What’s the difference between restricted and independent financial advice?

In the UK, an independent adviser can recommend solutions from the whole of the market. A restricted adviser cannot. Many of the big-name national firms are restricted, which limits your choice and may affect the quality of advice you receive. When you’re looking for financial advice, the first thing you should ask is simple: “Are you independent or restricted?” It sounds technical, but this single question can reveal a lot about how much freedom an adviser really has when recommending solutions to you. Independent advice An independent financial adviser (IFA) looks at all the options across the market. Whether it’s…

16.09.2025

The Mask of Wealth: Why appearances mislead in finance

Niccolò Machiavelli once observed: “The common people are always seduced by appearance and success.” It was true in Renaissance politics, and it’s just as true in modern finance. Human nature hasn’t changed. We’re drawn to the glitter, the glossy brochure, the smart suit in the glass-fronted office. Success dazzles, even when it hides something rotten underneath. In wealth management, this plays out every day. ~The brochure shows impressive graphs (but conveniently ignores charges). ~The firm boasts about scale and size (but forgets to mention they’re restricted). ~The adviser talks of “exclusive opportunities” (which sound rarer than they really are). It…

16.09.2025

What should I consider when choosing a financial adviser in the UK?

When choosing a financial adviser in the UK, focus on independence, total fees, qualifications, investment philosophy, and relationship fit. Glossy branding doesn’t guarantee financial wellness; asking the right questions does. Picking the wrong adviser can cost you more than just fees, it can cost you peace of mind. You’re not buying a product like a car or a holiday. You’re deciding who to trust with your life savings, your retirement, and in many cases, your family’s future. And yet, too often, people make the choice based on surface factors: a glossy brochure, a recommendation from a friend, or simply the…

15.09.2025

The hidden cost of Trusts and why a review could save your family a fortune.

When people set up a trust, it’s usually done with the best of intentions. Protect the family, save tax, pass wealth smoothly down the generations. All noble goals. But here’s the uncomfortable truth: a trust isn’t automatically a good idea. In fact, the wrong trust, or even a well-intentioned one managed poorly, can backfire spectacularly. Take the recent case of Chugtai v HMRC (2025). Mr Chugtai put a property and a bank account into trusts for his children more than 17 years before his death. On paper, that sounds like sensible estate planning. He excluded himself as a beneficiary, so…

11.09.2025

The pensions IHT rules are developing…

How should we rethink pension planning now that from April 6, 2027, unused pension funds and death benefits will be included in estate valuations for IHT? What’s changing From 2027, most unused pension funds and death benefits, including defined-contribution pots, annuities with death-in-survivor benefits, and discretionary lump sums, will be treated as part of your estate for inheritance tax (IHT) purposes. Previously, pensions were outside the estate and passed tax-free if left untouched. That’s no longer the case. Spousal transfers remain exempt, but any pension left to non‑spouse beneficiaries will count toward the nil-rate band (£325,000, plus residence band if applicable) The…

23.07.2025

Why financial wellness isn’t about products – It’s about you

When most people hire a financial adviser, they imagine conversations about their goals, their family, and their future. They want someone who’ll listen, ask thoughtful questions, and guide them towards financial security and freedom. But in reality, many advisers see the world very differently. Take St. James’s Place (SJP), for example. On their website, they proudly explain how they scour the marketplace for products, manufacture their own funds, and curate investments. At first glance, that sounds like exactly what a financial adviser should do. But here’s the problem: this focus on products tells you everything about the firm’s priorities. SJP…

11.07.2025

The coming financial dystopia: When AI controls your wealth.

“Global Markets Crash as Rogue AI Trades Against Itself – Governments Powerless to Stop It” – Financial Times, 2032 It sounds like science fiction. But is it really? We’re being told a comforting story about AI. That it will help us invest smarter, plan better, and make our lives easier. “AI will create more jobs than it destroys,” say the tech billionaires. “It’s good for everyone.” But deep down, do they believe it? Or is this just another line in the sales pitch for a world they’ll own, and we’ll rent? Your financial adviser is an algorithm In the not-so-distant…

08.07.2025

Why wealthy families can’t afford to ignore tax planning anymore

We live in Shrewsbury. It’s not London or Monaco, but it’s a place where you meet a lot of sensible, successful families, people who’ve built businesses, employed others, and paid their fair share. And here’s the truth: some of those families have quietly left the UK. Not for the weather. Not for adventure. For tax. They’re not trying to avoid paying what’s due. But they are,like most of us, unwilling to pay more than they need to, especially if they feel they’re being treated unfairly. And that’s where the conversation is heading. In recent years, we’ve seen a steady shift….

01.07.2025

What wealthy families miss by using restricted advice

Most wealthy families don’t think they’re using “restricted” advice. After all, their adviser is well-spoken, seems trustworthy, and manages a lot of money. But here’s the uncomfortable truth: many advisers, especially those tied to national wealth firms or banks, aren’t free to offer truly independent advice. Instead, they operate under a restricted model, meaning they can only recommend a limited range of products, typically those approved by their parent company or in-house investment team. That might not sound like a big deal, but it has profound implications for your financial wellbeing. Here’s what you could be missing: Better investment options….

26.06.2025

What does your Will really say? Ask AI and find out

Most people don’t fully understand their wills. They sign what their solicitor puts in front of them, file it away, and hope it does what they intended. But wills are legal documents written in legal language, and that can lead to confusion, especially for your family. But what if there was a simple way to stress-test your will? Something to help you understand what it really says, so you can ask better questions and make more confident decisions? That’s where AI comes in. Using ChatGPT to review your Will To be clear: ChatGPT and other AI tools cannot replace a…

18.06.2025

Here’s one for you to think about, write it down!

Writing down your thoughts and emotions can be highly therapeutic and beneficial for making sound financial decisions. Whether facing financial anxiety, planning for the future, or feeling overwhelmed by money matters, putting your feelings into words can help process them, gain clarity, and reduce stress. Writing helps you recognise and understand your financial feelings, providing insight into their causes and facilitating emotional processing. Transferring thoughts and emotions about money to paper can be cathartic, releasing financial stress and anxiety. Writing offers an outlet for negative financial emotions, and studies show it can improve both physical and psychological health. Identifying patterns…

16.06.2025

I have been thinking about cognitive dissonance

Do you really want to hear the truth? The old saying ‘the truth hurts’ exists for a reason. Our brains naturally resist information that threatens our self-esteem, challenges our beliefs, complicates our lives, or undermines our status. Admitting we’re wrong or at fault is difficult, even when it’s beneficial for us. When faced with painful truths, we instinctively protect ourselves by shutting down, tuning out, or resisting, often without realising we’re doing it. Why do we hate to hear the truth, especially if it involves hearing something we need to improve? A concept called cognitive dissonance gives us an answer….

15.06.2025

Investing in Art: A Unique Way to Diversify Your Portfolio

When you think about investments, your mind probably goes to stocks, bonds, or real estate. But what if there’s a completely different type of investment that combines culture, passion, and potentially significant returns? Enter the world of art collectables. Investing in art has long been seen as something reserved for the elite. However, with more accessible platforms and a growing online market, art is now becoming a viable asset class for investors looking to diversify. While it’s not as liquid as stocks or bonds, art offers the possibility of tremendous upside, especially when it comes to works from emerging artists….

13.06.2025

I was asked, should I take 25% or 100% of my pension?

A real story from someone facing the toughest of questions. I was recently asked a heartbreaking but important question: “I have a terminal illness and I’m on palliative care—should I take 25% of my pension or the full amount?” Samantha (not her real name), was 59 years old. Because she was under 75, the pension lump sum could be paid out tax-free—provided a registered medical professional, like her cancer consultant, confirmed she was expected to live less than 12 months. But the real question wasn’t about tax. It was about purpose. Samantha knew her days were limited. Her illness meant she couldn’t enjoy…

12.06.2025

The 4% Rule – does it still work?

You’ve probably come across the 4% rule. It’s one of the most quoted “rules of thumb” in retirement planning. The idea is simple: you withdraw 4% of your retirement pot in the first year, then increase that amount with inflation each year after. In theory, your portfolio should last at least 30 years. It sounds tidy and reassuring. But does it still work? Where the 4% rule came from. The rule came from a piece of research in the 1990s by US financial planner William Bengen. The 4% rule is a popular retirement strategy—but does it still work today? We…

10.06.2025

Why would someone spend £200,000 a year on life assurance premiums?

At first glance, £200,000 in life insurance premiums might seem excessive, especially when it’s more than many people earn in a year. But when the policyholder’s net worth runs into the millions, the rationale becomes more intriguing. So, why would a multimillionaire buy a life insurance policy? For those with substantial wealth, professional estate planning advice is readily available, and there are numerous options to mitigate inheritance tax (IHT) without relying on life insurance. Trusts, family investment companies (FICs), and other strategies can often serve as alternatives. So, why consider life insurance? Let’s put this into perspective. If your wealth…

10.06.2025

Why every parent needs a Will: Lessons from Liam Payne’s estate

The tragic passing of former One Direction star Liam Payne at just 31 has shocked fans and highlighted a crucial aspect of financial wellness: the importance of having a will. Despite his substantial wealth, Payne died without leaving a will, a situation known as dying “intestate.” Under UK law, this means his £24 million estate will pass directly to his eight-year-old son, Bear. However, because Bear is a minor, the estate is placed in a trust managed by appointed administrators, with distribution delayed until Bear turns 18 . The risks of Intestacy Payne’s case underscores the risks associated with intestacy:…

05.06.2025

Getting elected versus governing. Be careful what you choose.

I have been thinking about election v governing. “Just because you have the talent to get elected, it doesn’t mean you have the talent to govern.” This quote resonates deeply with me, especially when we think about wealth management. Many firms excel at securing clients — they have the skills to “get elected.” They know how to market themselves, promise the world, and win people over. But when it comes to actually governing — managing your wealth and providing consistent, reliable advice — the story often changes. It’s important to understand the difference. Firms that focus solely on getting hired…

04.06.2025

Are you thinking critically about the financial advice you receive?

Thomas Sowell once said, “When you want to help people, you tell them the truth. When you want to help yourself, you tell them what they want to hear.” This quote has stayed with me for years. In fact, I once asked a client, “Do you want me to tell you what you want to hear, or do you want me to tell you what I think? Keep in mind, what I think may not always align with what you expect.” It’s a tough question, but it’s one worth considering. Have you ever felt that your conversations with your financial…

04.06.2025

The horse and cart of wealth management: Why the future is coming faster than you think

In wealth management, we’re often told that the industry is evolving. But let’s be honest: it’s more like trying to update a horse and cart rather than building something truly new. The traditional wealth management model, built around personal advisers, big firms, and high fees, is a legacy business. Most firms are doing their best to adapt, but at the end of the day, they’re merely tinkering with the horse and cart, making it go a little faster and look a little sleeker. But just like the horse and cart was eventually overshadowed by the automobile, the wealth management industry…

28.05.2025

Giving while living: The power of giving during your lifetime

As we navigate through life, one question that many people wrestle with is how to pass on their wealth in a way that benefits others and leaves a lasting legacy. Traditionally, many have chosen to wait until after their death to distribute wealth to family, charities, or causes close to their hearts. However, the idea of giving while living is gaining traction, and for good reason. Not only does it allow you to see the impact of your generosity, but there are also practical financial benefits, particularly when it comes to inheritance tax (IHT) planning. Let’s explore how you can…

15.05.2025

Pensions and inheritance tax: is it really a concern?

Inheritance Tax (IHT) is often discussed in estate planning, especially when it comes to pensions. However, the reality for most people is that IHT on pensions is unlikely to be a major concern, simply because their pension funds aren’t large enough to create significant tax liabilities. The overstated fear: IHT on pensions For the majority of individuals, the value of their pension pots does not reach a level where IHT becomes a serious issue. While it’s true that pension funds are set to become subject to IHT for many people starting in April 2027, this won’t apply to everyone. For…

09.05.2025

Who does the CEO of a wealth management firm actually work for? (hint: it’s not you)

Let’s ask a simple question: in the world of wealth management, what does the CEO of a national firm actually ‘do‘ for you, the investor? You’re paying fees. Often not small ones. But where exactly is that money going? Most people assume that when they pay a wealth manager, they’re getting a team of experts personally looking after their money. A safe pair of hands. A sense of control. But the reality is far less reassuring. Here’s the truth: when you invest through a big-name national firm, a big chunk of your fee is going to head office. You know,…

02.05.2025

Does it matter which financial adviser or wealth manager you use?

The short answer? Yes — and no. Let me explain. First, forget the labels: financial adviser, wealth manager, financial planner, relationship manager, private banker… The industry throws around so many titles that it becomes almost impossible to tell them apart. So don’t get too caught up in what someone calls themselves. Instead, focus on you. What do you want? That’s the real question. Not what they offer. Not how they describe their services. You need to be clear about what you want help with. And if you’re thinking, “But I don’t really know what I want — or what questions…

02.05.2025

The End of the Non-Dom Era: What the New UK Tax Rules Mean for You

As of 6 April 2025, the UK’s tax landscape has undergone a significant transformation, particularly affecting non-domiciled individuals (“non-doms”). The traditional domicile-based taxation system has been replaced with a residence-based framework, impacting income tax, capital gains tax (CGT), and inheritance tax (IHT). Key Changes: 1. Income Tax and Capital Gains Tax: – Arising Basis: All UK residents are now taxed on their worldwide income and gains as they arise. – Foreign Income and Gains (FIG) Regime: Individuals who become UK residents after being non-resident for at least 10 years can, for their first four years of UK residence, elect to…

08.04.2025

Do I need a second opinion?

If a doctor recommended major surgery, you’d probably want a second opinion to ensure it’s the right decision. After all, the stakes are high, and it’s important to explore all options before moving forward. When it comes to your finances, it’s not all that different. Your financial health deserves just as much scrutiny, and sometimes, a second opinion on your portfolio can help ensure you’re making the best decisions for your future. But how do you know when it’s time for that second opinion? Here are some signs that may suggest it’s time to take a closer look at your…

02.04.2025

Are there ISA changes coming?

There’s been a bit of noise recently about how the government might shake up the ISA system. If you’ve been dutifully tucking money away into your ISA each year and you’re now wondering whether that’s all about to be turned on its head—take a breath. Let’s break down what’s actually being talked about, what’s rumour, what might be real, and why you probably don’t need to do anything drastic just yet. There’s talk that the government may shake up the ISA system—and this time it’s under Chancellor Rachel Reeves. The goal appears to be making ISAs “simpler and more accessible,”…

21.03.2025

Does your fund manager really care about you?

Have you ever stopped to ask yourself: “Does my fund manager actually care about me?” It’s an unsettling question, but one worth considering—especially when your future financial well-being is at stake. The reality of a fund manager’s job Let’s imagine you are a fund manager. Your role is to manage a pool of investors’ money, buying and selling investments within set parameters. Your primary objective? Performance. If you deliver results that exceed expectations, you get rewarded—typically in the form of a bonus. And if you underperform? Well, there’s a risk you’ll be replaced. Now, here’s the key point: “you don’t…

21.03.2025

Why do Investors make poor decisions?

Peter Rutter left Royal London Asset Management (RLAM) last year to set up his own firm, Life Cycle Investment Partners. Fast forward to today, and the firm is managing more than A$2bn (£1bn) in assets. At RLAM, Rutter was hailed as a “star manager.” So why leave? Could this be another Neil Woodford situation? Remember him? About 300,000 people lost money when the Woodford Equity Income Fund was frozen in 2019. Woodford was the golden boy at Invesco with billions under management before he decided to go solo. How’d that work out for him? Here’s the thing: if you’re a…

21.03.2025

Are your interests aligned with your wealth manager’s?

Imagine going to your doctor for advice. Do you expect them to prescribe treatment based on what’s best for you, or do you wonder if they have a boss telling them to push certain medications to increase hospital profits? This situation might sound absurd in the medical world, but when it comes to financial advice, it’s not far from the truth. You might think your wealth manager or financial adviser has your best interests at heart—but in reality, their interests are often tied to the goals of the company they work for. Here’s the problem: When you work with wealth…

20.03.2025

How do I feel less anxious about retirement?

In today’s unpredictable economic climate, it’s natural to feel anxious about your financial well-being. However, there are proactive steps you can take to bolster your financial resilience and navigate these uncertain times with confidence. Drawing inspiration from Kathleen Coxwell’s article, “Economic Uncertainty: 10 Ways to Improve Your Financial Well-Being When the World Feels Chaotic,” here are ten strategies to enhance your financial stability: 1. Build a robust emergency fund Establishing an emergency fund is crucial. Aim to save at least three to six months’ worth of essential living expenses. This financial cushion can help you manage unexpected events like job…

19.03.2025

How can I invest like Peter Lynch?

Peter Lynch, renowned for growing Fidelity’s Magellan Fund from $20 million to $14 billion over 13 years, attributed his success to straightforward investment principles. He averaged 29% annual returns from 1977 to 1990. I have seen many social media posts that explain how you can generate outperformance over time following Lynch’s philosophy. Before we really think about investing like Lynch to achieve similar results, let’s look at a few key principles: 1. Invest in What You Know Lynch believed individual investors have an edge because they encounter investment opportunities in their daily lives before investment markets catch on. He…

19.03.2025

The blind man and the elephant.

Here’s an old story that might sound familiar – the one about the blind men and the elephant. Let me tell you how it goes: One day, an elephant wandered into a village, and the people were all excited. They’d never seen anything like it before, so they rushed out to get a good look. Of course, there was a group of blind men nearby, and they were just as curious, even though they couldn’t see the elephant. They decided to touch it to understand what it was like. The first man touched the elephant’s side and said, “This is…

17.03.2025

Ros Altmann warns of ‘Disaster’ in Inheritance Tax reform for pensions

Former Pensions Minister Baroness Ros Altmann has sharply criticised the government’s plan to end inheritance tax (IHT) exemptions on unused pension pots, calling it a “disaster” for savers and a “blow to retirement planning”. The policy, announced in the 2024 Autumn Budget, is set to take effect in April 2027, and aims to raise up to £1.5 billion annually by taxing inherited pension funds that are currently exempt. See Alternative Credit Investor and Financial Times. What’s Changing? Under the new rules, any unused pension funds and death benefits from pensions will be included in a person’s estate for IHT purposes….

14.03.2025

How soon will AI Agents manage individual investment portfolios?

By late 2025 or early 2026, it’s likely that someone will create an AI capable of doing the work of national wealth managers (NWMs). In the future, all you’ll need is a platform, and an AI agent will handle everything from portfolio management to investment strategy. AI agents don’t need sleep, and the costs associated with using them will be a fraction of what current wealth management firms charge. Once the technology takes off, the shift in the industry will be unstoppable, potentially transforming—or even eliminating—household-name firms like St. James’s Place, Rathbones, Schroders, Brewin Dolphin, Aberdeen, Deutsche, Investec, Canaccord, Tilney,…

12.03.2025

Why John is leaving his wealth manager.

John had been a client of St. James’s Place for several years. Despite hearing the negative press surrounding the firm, he was content with his adviser and the service he received. However, when his adviser expressed a desire to leave St. James’s Place and shift to a different investment approach based on passive management, things started to shift. His adviser explained that this change would reduce costs and ultimately benefit John more. On the surface, this sounded great. But as the conversation progressed, it became clear to John that for years, his adviser had been selling him overpriced products and…

12.03.2025

Retirement income strategies for peace of mind.

Here’s an overview of various strategies for managing retirement income. Here’s a brief summary of some of the key strategies: 1. Bucket Strategy: This involves dividing retirement assets into buckets for different time frames—short-term needs in cash or low-risk investments, medium-term in bonds, and long-term in equities. This strategy helps manage market fluctuations by ensuring the immediate income needs are secure. 2. Separating Needs from Wants: Aimed at stabilising essential expenses through secure income sources, such as annuities or pensions, and using more volatile investments for discretionary spending. This approach helps retirees adapt to changes in market conditions. 3. Systematic…

12.03.2025

How do I ensure my family do not waste their inheritance?

The saying “clogs to clogs in three generations” paints a stark picture: a family rises from humble beginnings and amasses great wealth through hard work, but by the third generation, it’s all gone. This isn’t just a proverb—it’s a reality for many families. Despite all the effort and sacrifice, the wealth that took years to build can quickly disappear when passed down to unprepared heirs. For many first-generation wealth builders, the fear is real: will their children and grandchildren be capable of preserving the legacy, or will they squander it? Research confirms these fears. Studies show that 70% of family…

06.03.2025

Should I access my pension early?

Savers in the UK cashed out £52bn during the 2023/24 tax year, marking a 20% increase in pension withdrawals. With rising pressures from the cost of living and higher interest rates, many are turning to their pensions earlier than planned. But before you take that step, it’s important to pause and think about the long-term effects, including sustainability of withdrawals and tax consequences. At The Wealth Coach, we always encourage thoughtful planning when it comes to pension decisions, and that includes knowing when to access your funds. It might be tempting to dip into your pension early, but it’s crucial…

05.03.2025

When should I make a gift?

When it comes to tax-efficient gifting, many people overlook some of the simplest ways to save on inheritance tax (IHT). The Wealth Coach helps clients navigate these opportunities, and one often-overlooked exemption can make a significant difference. Understanding Inheritance Tax Exemptions Most of us are familiar with the annual £3,000 IHT exemption, but there’s a tax-efficient strategy that allows you to give away much more—gifts made from income. Unlike gifts from capital (like cash or assets), which count against your IHT allowance once they exceed the £3,000 annual cap, gifts made from surplus income are fully exempt from IHT. So,…

05.03.2025

How can I pay private school fees through my limited company?

If you’re a director or shareholder of a limited company, there’s a significant opportunity for you to discover strategies that could help minimise your tax liabilities. By optimising your income and assets, you can reduce the financial burden on your personal and business finances. At The Wealth Coach, we offer tailored advice during a discovery call where we will explore a range of strategies designed to help you optimise your financial position. Here’s a glimpse of what we can discuss: Paying Private School Fees Through Your Limited Company Did you know that you may be able to pay for your…

05.03.2025

Why should I hire a financial planner?

You don’t need an ongoing financial planner, but almost everyone could benefit from having one. Why? Most people have areas of their finances they overlook. By working with a financial planner, you can spot and fix these issues, which could have a big impact over your lifetime. Here are reasons why hiring a financial planner, like The Wealth Coach, can help you: Financial Planners Keep You Accountable Having someone to keep you accountable is important. Think about a workout partner—they make sure you show up and do the work. A financial planner does the same for your finances. With busy…

04.03.2025

I am worried about my small pension pot?

Many people aren’t aware that small pension pots could be eroding their savings more than they realise. A recent report from the Institute for Fiscal Studies (IFS) highlighted that millions of small pension pots are at risk of being lost or depleted by excessive charges. As auto-enrolment makes it easier to accumulate multiple pension pots, workers changing jobs frequently can leave them scattered and neglected. According to the IFS, over 12 million pension pots in the UK are worth less than £1,000, with charges significantly eating into their value. While pension pots set up after auto-enrolment have capped fees, many…

04.03.2025

How can I save for my children?

There are two great options for clients looking to invest for their children: pensions for long-term growth and Junior ISAs for shorter to medium-term investments. Both offer distinct benefits depending on your goals. Pensions for Children Children can also benefit from pension investments, even though they rarely have earnings. For the 2024/25 tax year, the maximum contribution is £2,880, which, with the 20% tax relief, totals £3,600. Only a parent or guardian can set up a pension for a child, but once it’s established, anyone can contribute — parents, grandparents, godparents, friends, and other family members. Be sure to set…

28.02.2025

What action do I take if I need to retirement early?

While some dream of early retirement, not everyone chooses it. If you’ve been forced into an early retirement due to circumstances like health issues, redundancy, or company changes, it’s important to take the right steps to ensure your long-term financial security. Here’s what to do next: 1. Process the Change Being pushed into early retirement can be a shock. Take time to process the emotions, seek support from loved ones, and avoid rushing into decisions. It’s important to care for your mental well-being during this transition. 2. Reframe Retirement as an Opportunity Look at early retirement as a chance to…

28.02.2025

I am confused about a Will and a Trust?

At The Wealth Coach, we believe that effective estate planning is essential to ensuring your assets are passed on according to your wishes. Two key tools in this process are a will and a trust, but they serve different purposes. Understanding the difference can help you make informed decisions about your legacy. What is a Will? A will is a legal document that outlines how you want your assets distributed after you pass away. Everyone needs a will, particularly if you have dependents or wish to specify how your estate is divided. Your will names your beneficiaries and the assets…

28.02.2025

Can I give my house to my children to avoid Inheritance Tax?

At The Wealth Coach, we understand that gifting your home to your children might seem like a simple way to avoid inheritance tax (IHT). However, the rules surrounding property gifting are complex, and without the right planning, your well-intentioned gift could lead to unexpected costs for your family. Understanding Inheritance Tax IHT is charged on the value of your estate when you pass away. If the value of your estate exceeds certain thresholds, your beneficiaries could face tax rates of up to 40% on the excess. To minimise this impact, it’s essential to understand your allowances and how property gifting…

28.02.2025

Should I use a lawyer or will-writer?

In the UK, the will-writing industry remains unregulated, which has led to an increasing number of unqualified individuals offering cheap will-writing services. While it might seem appealing to save on professional fees, opting for these unregulated services can create serious issues that often cost far more to resolve in the future. Take, for example, someone who chooses an unregulated will writer simply because the price is lower. They pay a small fee for a simple will, but when the time comes to probate it, the beneficiaries discover serious issues with the document. It could be something as simple as the…

27.02.2025

What CGT savings can I make?

As the end of the tax year approaches, it’s an important time to think about how you can make the most of your Capital Gains Tax (CGT) allowance. This year, the allowance is reduced to £3,000, half of last year’s exemption. However, changes to CGT rates following the Autumn Budget offer opportunities to optimise your tax position. Below are key points to consider, and if you’d like advice tailored to your specific situation, don’t hesitate to ask us, The Wealth Coach, for help. 1. How Much Allowance is Left? If you’ve made disposals earlier in the year, check how much…

26.02.2025

What is the benefit of salary sacrifice for my pension?

As the tax year-end approaches, many employees may be looking for ways to boost their pension savings while also taking advantage of available tax breaks. One such strategy that can significantly benefit higher earners is a bonus sacrifice arrangement. In this blog post, we’ll explore how bonus sacrifice works and how it can be a powerful tool for maximising pension contributions and minimising your tax burden. What is Bonus Sacrifice? Bonus sacrifice is a straightforward but effective strategy where an employee agrees to give up part or all of their bonus payment in exchange for additional pension contributions made by…

13.02.2025

Will a Family Investment Companies (FICs) help me?

When it comes to managing wealth and planning for future generations, family investment companies (FICs) have become a powerful tool, especially for high-net-worth (HNW) families. If you haven’t come across them yet, FICs are custom-built companies designed to hold and manage a family’s investment assets. They’re a sophisticated option for wealth succession and estate planning, offering flexibility and control that suits the unique needs of each family. What Makes a FIC Unique? At its core, a FIC is like a private company where your family members are the shareholders, and the company itself owns and manages the investments. What sets…

20.01.2025

When Will Bitcoin Crash?

Let me clarify upfront: I am not questioning Bitcoin’s utility. I have no idea whether Bitcoin will eventually become the global currency or merely a speculative asset. Time will tell. However, one thing is almost certain—Bitcoin is likely to crash spectacularly at some point, driven by the unpredictable nature of human behaviour. The Bitcoin Experiment: A Hypothetical Scenario Let’s say you have £1 million in investible assets. You decide to allocate 10%—£100,000—into Bitcoin. Historically, Bitcoin has demonstrated mind-boggling growth, with a compound annual growth rate (CAGR) of 109.07% in EUR terms over the past 13 years. If that growth rate…

17.01.2025

What happens if we are not married when one of us dies?

According to the Office for National Statistics, cohabiting but unmarried couples are now the fastest growing family type in the UK, making up around a quarter of couples living together. However, research from Will Aid last autumn found that 68% of cohabitees were unaware of what happens to their estate if they died without a Will. In fact, 32% mistakenly believed that their assets would pass to their partner, and 11% admitted to never having considered the issue! The rights of people in what some call “common law marriages” are often misunderstood, leaving cohabitees vulnerable. While legally married couples and…

09.01.2025

What’s important for me to learn about personal finance?

Personal finance, investing, and taxes are often made more complicated than they need to be. My job is to simplify it and help people achieve their goals. Here are 10 key lessons I believe everyone should understand about personal finance: Your income is your most important resource Budgeting is important, but you can only cut so much. Increasing your income has far more impact. Many of my clients have grown their income significantly by developing their skills and focusing on what they do best. Building equity is vital The wealthiest people either start a business or get equity compensation from…

08.01.2025

Do I need a Financial Adviser in Divorce?

Divorce is a significant life event that brings about not only emotional challenges but also complex financial considerations. Engaging a financial adviser or wealth manager during this period can be instrumental in securing your financial future. Key Areas Where Financial Advisers Provide Support 1. Comprehensive Financial Assessment: Advisers conduct thorough evaluations of all assets and liabilities, including properties, investments, and pensions. This comprehensive overview is essential for equitable asset division. 2. Pension Division: Pensions often represent a substantial portion of marital assets. Advisers clarify the complexities of pension sharing, offsetting, or earmarking, ensuring you receive a fair share. Notably, many…

28.11.2024

The Family Office Concept: Not Just for Billionaires

In 1882, ten years before John D. Rockefeller founded the University of Chicago, he established what is considered the first full-service single-family office in the United States. A single-family office is dedicated to managing the wealth and affairs of affluent families, handling everything from investments and financial planning to taxes, estate management, and personalised services. Rockefeller, alongside his trusted advisor Frederick T. Gates, avoided the high-cost firms of the day, choosing instead to build his own wealth management structure. This innovative setup included professional and administrative staff to meet his family’s unique financial needs. Inspired by Rockefeller, other affluent families…

21.11.2024

Is Sustainable Investing right for me?

In today’s world, many investors are looking to do more than just grow their wealth—they want to make a positive impact. That’s where sustainable investing comes in, guided by Environmental, Social, and Governance (ESG) criteria. What Is ESG Investing? Sustainable investing considers not just financial returns but the broader impacts investments have on society and the planet. ESG factors help investors assess how well companies manage risks and opportunities related to environmental conservation, social responsibility, and corporate governance. – Environmental (E): This focuses on how companies address climate change, resource efficiency, and environmental sustainability. – Social (S): This examines a…

25.10.2024

Everything you want to know about investing….on an index card

The index card went viral in 2013. It’s written by Harold Pollack, a Chicago University professor. He was interviewed and metaphorically mentioned, “that the best [financial] advice for most people would fit on an index card”. It’s based in the US but the principles remain the same wherever you live. There is a problem. It’s not the contents, its taking action. So many times in life we know what to do but simply do not follow through. It’s one of the reasons we do what we do is to ensure action is taken. On the back of his comments, he…

16.10.2024

Can a cat make more money in the stock market than a professional investor?

The UK’s Observer newspaper ran a competition way back in 2012 to find out. It pitted the stock-picking abilities of Orlando, a ginger feline, against three experienced money managers and a gaggle of high schoolers. The cat and the other two groups were each given an imaginary £5,000 at the start of the year to invest in stocks. By year’s end, the students were down to £4,840, while the professionals had actually made money, accruing £5,176. Meanwhile, Orlando, who selected his stocks by throwing a toy mouse on a grid of numbers allocated to different companies, had amassed £5,542. This…

16.10.2024

“A day in the life of a wealth manager”

“If you have ever wondered how it feels to be a financial advisor or wealth manager…this about sums up my last 12 years.” The following is an article from a US investment adviser. NEW CLIENT (NC): “I’m excited to have my money make more money than just sitting in the bank” FINANCIAL ADVISOR (FA): “Great. The most important thing is to be long term, patient and disciplined. Don’t let your emotions get the best of you because we can’t control what the market does in the short term.” NC: “Got it. I’m definitely long term and not afraid of risk.”…

15.10.2024

Tips for transitioning to retirement

1. Ease into Retirement Gradually Instead of stopping work abruptly, many people today gradually reduce their hours or switch to part-time roles. Before making a full transition, consider taking extended holidays or sabbaticals to adjust. This helps you test living within a retirement budget and gives a feel for the lifestyle changes. 2. Consolidate Your Accounts Simplifying your finances as you approach retirement can make life easier. Consolidate pensions, ISAs, and savings into fewer accounts to reduce fees and simplify management. Always ask about potential charges when moving funds, and carefully handle any transfers to avoid tax penalties. 3. Plan…

15.10.2024

Understanding the 10-Year Charge on Trusts

When it comes to estate planning, one key thing to keep in mind is the 10-Year Charge on Trusts. If you’ve set up a trust, this charge, part of UK inheritance tax law, comes into play every ten years, and it’s important to plan for it. What Are Trusts, Anyway? Trusts are a popular tool in estate planning, as they help manage and pass on assets according to your wishes. They come in various forms, but two common ones are: – Discretionary Trusts – Trustees decide how to distribute assets to the beneficiaries. – Interest-in-Possession Trusts – These give beneficiaries…

15.10.2024

Should I Retire Early?

Deciding whether to retire early is a complex and highly personal decision, often influenced by a range of financial, lifestyle, and emotional factors. While the prospect of stepping away from work earlier than expected is enticing, it’s crucial to carefully assess whether early retirement is the right path for you. As a UK-based chartered wealth manager, I often help clients navigate these considerations, ensuring that any decision aligns with their long-term financial well-being and desired lifestyle. Financial Readiness The first and perhaps most important question is whether you are financially prepared for early retirement. Early retirement could mean stretching your…

27.09.2024

A healthy person has a thousand wishes; a sick billionaire has one.

The True Meaning of Wealth: Health Over Money The quote, “A healthy person has a thousand wishes; a sick billionaire has one,” poignantly captures the essence of human priorities and the importance of well-being, regardless of wealth. As a chartered wealth manager, I often observe how financial success can overshadow the true value of health and happiness. Many strive for monetary wealth, believing it to be the ultimate goal, yet fail to realise that wealth alone cannot compensate for a lack of physical or emotional well-being. The Price of Sacrificing Health for Financial Success In today’s fast-paced society, accumulating wealth…

24.09.2024

Zebras Everywhere… How Do You Invest £1 Million?

It’s a common scenario: You have £1 million to invest, and suddenly every Private Bank, Wealth Manager, Building Society, and IFA is vying for your attention, all eager to convince you that they’re the best choice. The professionals at these firms are friendly, knowledgeable, and polished—just as you’d expect. Each one has a compelling story about why you should choose them. But in truth, they’re like a herd of zebras. This phenomenon, what we call the “Zebra Effect,” is defined as a “state of mental distraction caused by too many equally attractive choices.” Just like a lioness overwhelmed by a…

20.09.2024

You’ve transferred your pension, so how do you make sure it’s a success?

John and Sarah recently sought advice regarding their pension fund. John had previously transferred his pension from a final salary scheme, with a transfer value of £850,000. The advisers who facilitated the transfer had set up an investment portfolio for him. However, John was largely indifferent about the portfolio’s management or the associated costs. His perspective was straightforward: as long as the fund earned 2% annually, he believed he would be better off than if he had remained in the original scheme. John had calculated that achieving this modest return each year would still surpass the benefits provided by his…

15.08.2024

First learn not to drown, then how to swim. Learn why you invest before you do.

I was sitting by the swimming pool waiting for my swim advancement class and watched adults learning to swim for the first time. I could see their fear of the water. Whilst the teacher was helping them with floats and breaking the stroke down into bite-size deliverables, I started to think… Maybe they shouldn’t be thinking about swimming at all. There is a difference between swimming and not wanting to drown. Which is the greatest fear? Without a doubt, not wanting to drown. The basic purpose of swimming is not to drown. The pleasure of swimming is secondary. What if…

15.08.2024

Are offshore tax centres good or bad?

Back in 2019, the Cayman Islands, the notorious tax haven, promised to publish the identities of everyone who owns a company there by 2023. Of course, there are so many tax havens, if you are that committed, you’ll find a jurisdiction that will be accommodating. If you are trying to hide money and avoid tax, then investing in an offshore centre where there is little or no transparency, offers potential opportunities for those individuals and companies wanting secrecy from their dealings. In fact, The World Bank has estimated that corruption adds up to 10% to business costs globally. According to…

15.08.2024

Why perspective is vital in your investment decisions

It’s a statement made by Football boss Mauricio Pochettino. He is now one of the most highly-rated managers in world football. He says ” After games, my wife gives me a lot of advice and criticism. Sometimes I am upset, I say why do you advise me this? But I like it, because to listen to a different point of view is always important. You can find a different position or point of view that can help you to be more creative.“ This is the point. Charlie Munger, (Warran Buffett’s partner) has often said, to try to fully understand the other person’s view. When…

08.08.2024

“If I knew when I was going to die, then planning would be so much easier.”

In conversations with clients, I have heard many times the statement. If I knew when I was going to die, then planning would be easier. The purpose of this blog is to explore an opportunity for the insurance industry to develop a new product that can really help investors in their planning. Let’s imagine you think you will live past the age of 85. Then from age 85, you benefit from a guaranteed income until you die. Would you buy such a policy? Many thousands of people buy life assurance. They are hoping they don’t die early, but recognise that its…

08.08.2024

Are you prepared to have your thinking about your financial decisions challenged?

99% of investors have no clear idea of their performance and the costs of investing money, even when they think they do. 1% are prepared to have their thinking challenged. What do we mean by having your investment decisions challenged? Every investor has a problem they need the answer to. How do I know if I am doing the right thing? Why is that a common problem? The answer is in the term ‘feedback loops’ Knowing if you have had a good meal, the feedback loop is minutes. Driving too fast in your car, the feedback loop is seconds. Reflecting…

08.08.2024

We help strengthen your Adaptive Competence

Knowing how to make good decisions requires you to develop your adaptive competencies. In essence, adaptive competence is vital to every financial decision you make. You are the personal CEO of your family wealth. It means you bear the responsibility for the decisions that are made. The quality of these decisions directly impacts the outcomes you achieve. Making wise choices leads to favourable results, while poor decisions often yield undesirable consequences. To ensure effective financial decision-making, it is essential to first identify the underlying problems. Critical thinking plays a fundamental role in this process. As Albert Einstein once remarked, “If…

22.07.2024

What if HMRC decide to use AI to collect tax?

Have you ever wondered what could happen if HMRC (His Majesty’s Revenue and Customs) decided to use artificial intelligence (AI) to its advantage? Imagine if they could peek into various aspects of our lives like our credit card transactions, car ownership, bank records from around the world, and even our online activity like social media and web browsing. Sounds a bit like something out of a sci-fi movie, right? But guess what? It’s not fiction; it’s real, and it’s happening today. The government has put a whopping £100 million into a system called Connect, which uses AI to analyse loads…

22.07.2024

How often should I review my will?

It’s advisable to review your will at least every five years, preferably more often, even if you don’t think any changes are necessary. Common Reasons to Change a Will: – You change your mind about existing gifts. – You acquire new assets to gift to loved ones. – You get married or divorced. – You have more children or grandchildren. – You wish to appoint or change your children’s guardians. – You wish to change your executors. – Changes in inheritance tax legislation require planning. When is my will no longer valid? Your will is automatically revoked if: – You…

18.07.2024

Why do prospective clients ignore small firms?

Many people are attracted to big brands in various products because familiarity often outweighs the cost. This same belief that “bigger is better” is common in investing and financial advice. People think that well-known firms provide better service and returns due to their size and global presence, and they feel their money is safer with these firms. However, this perception can be misleading. The impressive image of big financial institutions, with their endorsements and sponsorships, does not guarantee trustworthiness or better service. Despite lavish offices and high-rise views, these features do not ensure better investment returns or advice. Large firms…

12.07.2024

When it comes to your wealth, you want:

It is important to understand any differences in services, simply so you can have clarity of the service you want. When it comes to your wealth, you want: Unbiased conversation. We provide open and impartial conversation. The majority of national wealth managers do not provide impartial advice. Why is that? Long term thinking We all focus on the short term. It’s normal. It’s an ancient habit. Long-term thinking is critical to your success. As such, we think long-term. Wealth managers are continually trading. Why is that? Focus on your big picture. We think about how you allocate your capital amongst…

12.07.2024

When should parents gift assets to their children?

Losing a spouse is undoubtedly one of the most challenging and emotionally overwhelming experiences anyone can face. Amidst the grief and sadness, widows and widowers often find themselves tasked with managing their finances alone. Dealing with financial matters during such a difficult time can be daunting, but having a comprehensive checklist can provide essential guidance and support. In this blog post, we present a financial checklist designed to assist widows and widowers in navigating their financial responsibilities and planning for the future. 1. Gather Important Documents: – Obtain copies of your spouse’s will, death certificate, and any relevant legal documents….

10.07.2024

We help you think long term.

The evidence is clear. Most people find it challenging to think far into the future because they are limited by financial constraints, fear and other worries in life. In fact, its normal to think short term. Short-termism is a common affliction and an ancient habit. But our short-term tendencies are getting worse, precisely at a time when we need to measure our actions’ impacts long into the future. Various studies conclude that long-term strategy is critical to future success. We provide the independence, curiosity and resilience essential to long-term thinking. We help you do things that may make little sense…

10.07.2024

We think total wealth.

The wealth management industry predominantly centres its attention on equities and bonds investing. We focus on all your assets. Certainly, you may opt to allocate your funds into equities and bonds, or you might diversify across various asset classes such as your primary residence, investment properties, private equity, pensions, ISAs, Trusts, art, wine, whisky, classic cars, antiques, gold, silver, crypto, and even your own business. Regardless of the assets and their proportions you select, the fundamental aim remains consistent: to invest your capital today with the expectation of generating greater returns in the future. This, in essence, is the essence…

10.07.2024

We challenge your thinking.

Passion for tennis often brings to mind legendary players like Nadal, Federer, and Djokovic. Have you ever wondered if they would have reached their pinnacle without each other’s relentless challenges? It’s a testament to the principle that growth and excellence often emerge from pushing against formidable opposition. Similarly, in the realm of ideas and innovation, fostering a dynamic exchange with intelligent peers can be a transformative experience. This interaction is purposefully designed to push your thinking and refine your ideas, ultimately enhancing your adaptability and competence. It’s important to note that the wealth management industry while striving to win your…

10.07.2024

What is your legacy?

Accumulating assets is a commendable endeavour, but their true value transcends mere numbers on a balance sheet. To harness the full potential of your wealth, it’s imperative to infuse it with purpose and shape a lasting legacy that reflects your values and aspirations. Wealth without a purpose can lead to unfulfilling outcomes. By identifying a meaningful purpose for your assets, you give your wealth direction and impact. Whether your aim is to provide for your family’s future, support causes close to your heart, or enable innovative ventures, your wealth can be a powerful tool for realising your vision. Your legacy…

10.07.2024

We help you embrace technology.

The world of wealth management has, for too long, operated in the shadows of technological progress. However, start-ups with fresh ideas begin to reshape the landscape. This transformation is not only inevitable but promises to deliver significant benefits to you.. Artificial Intelligence (AI) has garnered much attention for its capacity to streamline processes and enhance decision-making. While it’s true that AI has the potential to automate certain tasks and roles, particularly within the wealth management sector, this will be welcomed. One of the key challenges in traditional wealth management has been deciphering the often complex reports and statements. Do you…

10.07.2024

Are all Financial Advisors the same?

As a consumer, it’s confusing. There are wealth managers, private bankers, financial advisors, independent financial advisers, financial consultants, and financial planners…which for most people all mean the same thing. So how you describe a financial adviser is not a simple way to differentiate their services. The one thing all financial advisors have in common. Friendliness, niceness, confidence, empathy. serious, sensible.. Why is that? If they were angry, forceful, untrustworthy, and flippant, you wouldn’t do business with them. It doesn’t matter if they were the best Financial adviserss with your money, you wouldn’t employ them. You want to deal with someone…

26.06.2024

Joseph Heller and Enough

I came across this lovely anecdote from a book by late Vanguard founder John Bogle. This was an exchange Bogle witnessed at a party given by a billionaire on Shelter Island in New York. The late novelist Kurt Vonnegut informed his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch-22 over its whole history. Heller responded – “Yes, but I have something he will never have . . . enough.” Fittingly, John Bogle titled his book “Enough.” (H/T Morgan Housel’s blog)

26.06.2024

Why do you think that the top wealth managers elect not to give you independent financial advice.

Why do you think that the top wealth managers elected not to give you independent financial advice? Why is it that Companies like St James Place, Brewin Dolphin, UBS, and Credit Suisse and numerous others, elect not to give independent advice? Is it in your interests or their interests? If a firm is focused on your interest they would offer independent advice. It can be clearly argued therefore that these firms put their interests first. If you choose to use national wealth managers who are not impartial, you still need independent help and guidance. Why? How do you know if…

26.06.2024

How do you get outperformance?

This is an advert by a wealth manager… “More than 80% of active funds don’t beat the market after fees. The reasons for this are many and include: – institutional pressures – short-termism – high fees – undifferentiated investment approach – index-hugging – misaligned incentives – etc. Most of these reasons are unlikely, or at least challenging, to change and with the competitive threat of passive investing increasing, the future looks bleak for the vast majority of active funds. Passive funds and ETFs offer investors a chance to avoid the duds and get a market return (less a modest fee)….

26.06.2024

Should I put assets into a trust?

Whether you should put assets into a trust depends on your specific circumstances, financial goals, and estate planning objectives. Trusts can be valuable tools for asset protection, privacy, avoiding probate, and controlling the distribution of assets after your passing. Here are some factors to consider when deciding whether to put assets into a trust: 1. Asset Protection: Trusts can offer a level of protection for your assets from potential creditors, lawsuits, or financial misfortunes. If you have substantial assets or are in a profession with higher liability risks, placing assets in a trust can shield them from certain legal claims….

26.06.2024

A financial checklist for widows and widowers

Here is a list from a US firm…it is helpful wherever you are in the world. Losing a spouse is undoubtedly one of the most challenging and emotionally overwhelming experiences anyone can face. Amidst the grief and sadness, widows and widowers often find themselves tasked with managing their finances alone. Dealing with financial matters during such a difficult time can be daunting, but having a comprehensive checklist can provide essential guidance and support. In this blog post, we present a financial checklist designed to assist widows and widowers in navigating their financial responsibilities and planning for the future. 1. Gather…

26.06.2024

How to help families stop falling out over inheritances

To help families avoid conflicts over inheritances, which can lead to emotional challenges and long-lasting rifts, consider the following tips: 1. Open Communication: Encourage regular, open, and honest discussions about inheritance plans, expectations, and intentions to minimise misunderstandings. 2. Early Planning: Start inheritance conversations early while everyone is alive and well to ensure smoother transitions and reduced tensions later. 3. Seek Professional Advice: Use a qualified estate planner or financial advisor to assist with estate planning and distribution, ensuring fairness and clarity. 4. Treat Beneficiaries Fairly: Aim for an even and fair distribution of assets, considering each beneficiary’s needs and…

26.06.2024

As an investor, here is your dilemma of a stock market fall.

As an investor, here is your dilemma. You use a wealth manager or similar. You’ve known them for many years and have no reason to doubt them in any way. You have £1m invested. They charge 1% each year. The stock market falls by 30%. You have lost £300,000. In the first month, after the crash, they still made over £580. You carry all of the risks. And if the markets fell by 50%, your money has to grow by 100% to get back to its previous level. You must get investing right. You are the only loser.

26.06.2024

What is your conflict with your wealth manager?

When you invest your money, you are looking for a positive return. In the majority of cases, you get a positive return. That’s the way the markets work. Prior to investing your money, you want the best return possible subject to the risk you are prepared to take. That is a normal objective. In other words, your focus is on the return on your money. One day, you’ll want your money back. In the world of wealth management, their focus is not the same. Their focus is on managing your money. You and your wealth manager do not want the…

26.06.2024

What is a digital estate plan and should you have one?

A digital estate plan is essential to ensure that your online accounts and digital assets are managed according to your wishes after your death or incapacity. Twenty years ago, this might have meant simply jotting down your email login details. However, today, with the vast array of social media and online content, a digital estate plan is crucial. What is a Digital Estate Plan?A digital estate plan is a document or set of instructions detailing how to handle your digital assets and online accounts after your death or incapacity. These assets can include emails, social media accounts, online banking, digital…

26.06.2024

Your friend ripped you off, but you forgive them?

Sometimes, people we know and trust don’t act as we hope. Do you forgive them? If you do, it’s because they are your friend. But what if they weren’t your friend? You might feel differently. You could call the police or hire a lawyer because being ripped off isn’t right. In this case, you wouldn’t forgive them. Why do we treat the same wrongdoing differently depending on who commits it? We forgive friends but not strangers. Consider buying a washing machine. It uses more water and electricity than the salesperson claimed. That was a key reason for your purchase. Do…

26.06.2024

Are you curious, interested and open-minded about your money? If so you’ll love talk to us. If not try…

If you are interested in how you allocate your capital for your future and your family’s future, you will naturally ask questions. You want to know more about how to invest your money. It’s being curious, interested and open-minded. It also means being challenged. Just because you think something is right, it doesn’t mean it is. So being open-minded allows you to reflect on how to make the right decisions, not just the ones that feel right. If there was a scale of 1 -10 for curiosity and open-mindedness, with 10 being the most and 1 the least, it is…

26.06.2024

People make stupid investment decisions. It’s not because they are stupid. Just human.

from chat gp Title: People Make Stupid Investment Decisions. It’s Not Because They Are Stupid. Just Human. Introduction: In the world of investing, rationality often takes a back seat to emotion. Despite the abundance of financial education and access to information, people still find themselves making irrational and sometimes downright stupid investment decisions. But before we rush to judgment, it’s crucial to understand that these decisions aren’t necessarily a reflection of one’s intelligence but rather a testament to the quirks of human behaviour. 1. Emotions vs. Rationality: Investing is as much an emotional endeavour as it is a rational one….

26.06.2024

Do You Need a Financial Adviser for Your Pension?

Your pension is a marathon, not a sprint, and involves many decisions throughout your life. Why You Might Need Pension Advice Planning for retirement is complex. Getting advice from an Independent Financial Adviser (IFA) can be crucial. Getting Pension Advice Finding the right professional is easy, fast, and free. Here’s why you might need an IFA for various pension-related decisions. Starting a Pension Employees are automatically enrolled in workplace pensions. High earners or those with personal pensions may benefit from professional advice to maximize their savings and avoid pitfalls. Without a workplace pension, you’ll need a personal scheme, as the…

26.06.2024

Helping grandchildren achieve a debt-free degree

With exam season over, more than 550,000 students are expected to start at UK universities in September. For many, this is an exciting chapter, but the thought of paying for it can dampen enthusiasm. Student loans are available, but facing debts over £60,000 by graduation is daunting and might deter some from attending university. Grandparents can significantly impact their grandchildren’s futures by helping them graduate debt-free, potentially reducing their own estates for inheritance tax (IHT) as well. One approach is to cover costs as they arise, but it’s wise to start planning earlier. An offshore bond held in a discretionary…

26.06.2024

Don’t retire.

The thing you’ve been looking forward to after decades of working? Yeah. Don’t do it. According to the mountain of research I pretend to understand while scrolling through my phone at 2 a.m., retiring is basically the equivalent of giving your brain a pink slip. Work gives us purpose, a routine and keeps your social network 25% larger. Yes, you hate me now. But the negatives associated with retirement are eye-popping. Retirement is associated with a 40% increase in cardiovascular incidents like heart attack or stroke. It increases blood pressure, cholesterol, body mass, chance of cancer and likelihood of diabetes….

26.06.2024

How Loss Aversion Screws Up Your Golf Game

People fear losing more than they desire to win, a phenomenon known as loss aversion, first demonstrated by Amos Tversky and Daniel Kahneman. This concept, explored in Kahneman’s book ‘Thinking, Fast And Slow’, is prevalent in many aspects of life, including golf. Economists Devin Pope and Maurice Schweitzer studied this phenomenon on the golf course. They hypothesised that golfers, motivated by loss aversion, would put more effort into avoiding a bogey (putting for par) than into trying for a birdie. Their analysis of over 2.5 million putts confirmed this theory. Golfers, including Tiger Woods, showed a 3.6% higher success rate…

30.05.2024

How Qualified Are Your Financial Advisers?

When it comes to investing your money, are you working with a Chartered Financial Adviser, a Certified Financial Planner, or a Chartered Financial Analyst? If you haven’t checked, now is the time to do so. Blair duQuesnay, a U.S. adviser, wrote an article titled “My Yoga Teacher Decided to Become a Doctor.” In it, she shares how her yoga instructor decided to retrain as a doctor—a process that will take about eight years. Blair contrasts this with the fact that a financial adviser can be regulated to provide advice within just a few months. The situation is similar in the…

14.04.2024

Are you a St James Place investor?

Are you feeling overwhelmed by the recent buzz surrounding St James Place and the uncertainty it’s causing? You’re not alone! Many customers are grappling with the decision to transfer out, but the process isn’t straightforward. With countless financial firms and wealth managers vying for your attention, it’s challenging to determine the right path forward. But fear not, there’s hope on the horizon! While the idea of DIY financial management might seem daunting, there’s a world of opportunities waiting for those willing to explore. Even if you lack the technical know-how or confidence, we’re here to lend a helping hand. Thanks…

21.03.2024

I run a business, how can I extract profits tax efficiently?

For family business owners, keeping a large cash reserve in the business bank account might seem like a safe strategy. After all, it provides a cushion in case of emergencies and might even feel like a way to avoid taking unnecessary risks. However, while this may seem like a conservative approach, it can have some long-term implications, particularly regarding taxes and the business’s future. At The Wealth Coach, we often advise clients on how to manage their business profits in a way that reduces tax liability and increases financial security. Here’s a look at why leaving cash sitting in the…

05.03.2024

Is your wealth manager horrible, grumpy, sweaty and totally without humour and empathy?

How many wealth advisors, fund managers, and stockbrokers tell you you are stupid? That you don’t know what you’re doing. How many are grumpy, bad-tempered, arrogant – in fact, they’re not nice people? The answer is – there are probably none. Why? You wouldn’t use them. You don’t need to apply logic, even if they were brilliant…your gut feeling would tell you to stay clear. The product providers clearly understand that you are more likely to buy because of likeability rather than brilliance. Your wealth manager is friendly, likeable, interesting, well mannered and dressed as you would expect. These are…

07.12.2023

How do you talk to your parents about your inheritance?

You know Mum and Dad seem not to have money worries. You presume when they die, you’ll receive an inheritance. However, you don’t know how much or when. Is this something you should discuss or not with your parents? I would argue yes. Imagine you are in their position. Would you want to talk with your children about your plans? Would you tell them you want to support a charity? How would you like your children to sustain your inheritance? Would you skip a generation? There are many things to discuss. If you feel it would be good to talk…

07.12.2023

A Wealth Of Information Creates A Poverty Of Attention

Herbert A. Simon puts it: `What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention, and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.” In today’s digital age, we are bombarded with an unprecedented wealth of information. From financial news to stock market analyses, the information available to investors is seemingly limitless. However, as the saying goes, “What information consumes is rather obvious: it consumes the attention of its recipients.” This paradoxical situation leads to a vital consideration…

07.12.2023

10-Year Retirement Checklist: Preparing for a Happy Retirement”

You’re on the cusp of retirement, having diligently saved throughout your working years. However, the demands of work and family life can easily distract you from proper retirement planning. In these crucial final years before retirement, it’s vital not to let up. The decisions you make now can significantly impact your retirement savings and whether you can maintain the desired lifestyle post-retirement. If you’re well-prepared, that’s excellent! If not, you still have time to make the necessary adjustments. To assist you, we’ve created a comprehensive 10-point checklist to steer you towards a fulfilling retirement. 1. Create a Budget: Begin with…

25.10.2023

There was once a Brewin Dolphin investor who paid over 2.5% to manage their money…

It’s no joke. A recent article in the FT, explained the costs of wealth management fees. The analysis was carried out by Numis. The results are below. In our view, whilst the fees are high, the debate should be on value. If a customer with Brewin Dolphin invested £500,000, the question an investor needs to ask is whether they are getting value. Of course, Brewin Dolphin would say unequivocally yes. But what does the customer think? Simply if Brewin Dolphin have thousands of customers, all prepared to pay their high fees, then those customers must be satisfied. The logic is…

06.10.2023

How do you manage your wealth manager?

Why should you manage your wealth manager? In fact, how do you manage your financial adviser, stockbroker, private banker, as well as your wealth manager? Have you ever purchased anything in your life you regretted? Perhaps a meal, clothes, a car, a holiday…..and you question yourself, “Why did I buy it?” It happens to all of us. In fact, making mistakes is an opportunity to learn. Some mistakes however are difficult to spot. If you can’t spot them, you are unlikely to regret them. Using intermediaries to manage your money, it’s hard to know whether you’ve made a mistake or…

19.09.2023

Are your investments ‘faulty?”

I was reading recently about a faulty product that Which? suggested people should stop using it immediately following an investigation by the consumer watchdog. Rather worryingly, investigators stated that the product’s CE mark, normally associated with having passed rigorous European safety standards was misleading. Some Chinese companies use a similar CE mark to designate ‘China Export’. Other companies simply fake the security mark because there is no central database to check whether it has been verified and it can be self-declared by companies. The quote that most interested me was ‘Companies get away with it until they don’t’ said Clever…

19.09.2023

“It won’t happen to me, I am superman or superwoman”

Self-confidence when investing is important. Overconfidence is dangerous. It’s knowing where the line is! Investors can often believe they are making the right decisions, but often the decisions are not right, instead, they feel right. How can you distinguish between a decision you are about to make and know it is right rather than ‘feeling’ right? I recently talked about scammers. When you make your own financial decisions, it’s important to get them right. Mistakes can be very costly. Scammers are big mistakes. You lose your money. You can also lose your self-confidence. Bigger mistakes can be compounded but you…

20.07.2023

Do you love your job? Do you love investing?

If you have a job, love it. We all know the benefits. The same principle applies to investing. Learn to love it. It means you need to take responsibility for your wealth. To be engaged, to be curious, to be interested. But if you see money as an end goal, without embracing the journey, the chances are you will fail way short of what is possible.

20.07.2023

Protecting Yourself from Financial Scams: Stay Alert and Stay Secure

In today’s digital world, financial scams have become increasingly prevalent, targeting unsuspecting individuals and causing significant financial and emotional damage. Recognizing the signs of financial scams and knowing how to protect yourself is crucial. This blog aims to empower you with knowledge and practical tips to safeguard your hard-earned money and personal information. Educate Yourself: Stay informed about common types of financial scams. Research online or consult reliable sources to familiarise yourself with prevalent scams such as phishing, identity theft, pyramid schemes, investment fraud, and romance scams. Understanding how these scams work is the first step towards protecting yourself. Protect…

20.07.2023

How do you move from a golf handicap of 25 to 10?

How do you move from a golf handicap of 25 to 10 or from 10 to 5 or 5 to scratch? The answer is help. Imagine going to a golf professional to help you improve your game and they tell you that what you need is a new set of clubs, in other words, the clubs are the problem, not you. And by the way, they can sell you a new set of clubs! Do you smell a rat? Do you want to improve your tennis? The tennis pro says, it’s not you, it’s your racket. If you purchased a…

20.07.2023

There are no Michelin stars in the world of financial advice, financial planning or wealth management.

I am sure you know what a Michelin Star represents. One star: A very good restaurant in its category. Two stars: Excellent cooking, worth a detour. Three stars: Exceptional cuisine, worth a special journey. As a consumer, having a recognised impartial brand that helps you decide where to eat is brilliant. Of course, there are many restaurants that offer excellent food. Many don’t want to be recognised by the Michelin Guide. Yet, for those that do, as a consumer, you can set your expectations. There is no Michelin Guide when it comes to who you talk to about your money….

20.07.2023

Charley Ellis: six nuggets of investment wisdom

Charley Ellis has been a voice of common sense in the world of investing for more than 50 years. His book, Winning the Loser’s Game, which explains why low-cost, buy-and-hold indexing is the rational choice for all investors, has become a classic. He’s now aged 85 but still working. To read more and listen to his interview, see here. This will get you thinking… 1. Success is all about minimising mistakes “A loser’s game is any competitive activity, where the outcome is not controlled by the winner, but it’s actually controlled by the loser. Golf is a good example. People…

20.07.2023

You can’t get fit by delegating exercise to someone else

Of course, it’s stupid to think you could ever get fit by delegating the exercise to someone else to do for you. In your relationship with your money, do you delegate the decisions to others? Many people do it in some form or another. But you still need to show interest. More often than not, the more decisions you make yourself, you more you understand and the more satisfaction you get. In essence, you have to start making more of your own investment decisions to find out what works for you and what doesn’t. In doing so, you’ll make some…

20.07.2023

West Ham’s owner Mr David Gold dies intestate

Edwin Coe LLP latest blog post discusses intestacy. You can read the blog here. In summary, the West Ham owner died intestate. Is that a problem? It means the distribution of his assets is based on legislation not wishes. You could argue therefore, there is no unfairness in distribution, as the law stipulates who has what. Yet people being people, they argue. They feel aggrieved. They feel left out. They feel angry. And when they feel mistreated, they make legal claims. To illustrate simply see below all these celebrities who died without a will but still argue. Clearly the moral…

20.07.2023

Coutts is in the news. Again. Should you be a client?

According to the BBC, Nigel Farage has launched a fresh attack over Coutts Bank’s decision to close his account. The bank, owned by NatWest, says customers must borrow or invest £1m or have £3m in savings. Mr Farage previously did not dispute that he did not meet Coutts’ threshold but said the bank had not had a problem with this for the past 10 years. But why do people want to bank with Coutts? Do they offer better products? Do they offer better service? Do they offer better value? In all of these areas, the answer is, unlikely. Yet people…

20.07.2023

You’ve made your will. You can now rest assured should anything happen to you, everything is sorted.

You know of course your will can be challenged. Why is it that 3 in 4 people are likely to experience a will, inheritance, or probate dispute? That means beneficiaries are not happy. They may feel the distribution is unfair. 3 in 4 is a daunting number, as it could lead to your will being challenged. That is something you never intended when you drafted your will. There is another unknown statistic. How many beneficiaries feel aggrieved, mistreated, and hurt but do not move towards a dispute? They stay silent, but nevertheless, the damage is done. How would you feel…

19.07.2023

‘A human really has to take the responsibility’ Steve Wozniak

Apple co-founder Steve Wozniak has warned that artificial intelligence (AI) could make scams and misinformation harder to spot. Mr Wozniak says he fears the technology will be harnessed by “bad actors” as posted on the BBC. In the world of finance, by implication, scams will be harder to spot. According to Steve Wozniak , he believes, ‘A human really has to take the responsibility “He thinks responsibility for anything generated by Artificial Intelligence and then posted to the public, should rest with those who publish it: “A human really has to take the responsibility for what is generated by AI.” …

18.07.2023

This is why it’s so confusing for consumers to choose a wealth manager.

Take a look at “Find a wealth manager website.” Here’s what they say “So how do you know which company is right for you? And then how do you find the professional best suited to serving you, based on your own specific needs within that firm? You look online, read some print articles and maybe talk to friends, and the conclusion: they all appear to look and sound the same. As both a private banker and a client, our founders saw various challenges for those seeking a wealth manager: opaque information and inflated fees. So in 2012 they decided to…

05.04.2023

Who do you ask for a second opinion?

“Check everything, make sure the people advising you are regulated,” Bellamy added. “If they are not regulated, it’s the wild west. Get your stuff audited by independent people, the equivalent of getting a second opinion.” These are the words of Craig Bellamy. Burnley assistant manager and former Wales captain Craig Bellamy has said he is bankrupt. You can read the story here. However, who do you ask for a second opinion? It seems from the news that Bellamy did not benefit from regulated advice. As such, it would make sense to get a second opinion from someone who is regulated. …

05.04.2023

As a private investor, you need to become your own CEO. Are you up for the job?

As a private investor, you need to become your own CEO. Are you up for the job? The job of a CEO is asset allocation. You want to employ intelligent capital allocation, yet there are plenty of businesses that allow unintelligent capital allocation. Warren Buffet’s 1987 letter to shareholders explains, “Profitable companies generate cash that must be deployed.” The lack of skill that many CEOs have at capital allocation is no small matter: After ten years on the job, a CEO whose company annually retains earnings equal to 10% of net worth will have been responsible for the deployment of…

31.03.2023

Healthspan v Lifespan and Money

“Modern medicine has increased life expectancy – over the past 100 years the global life expectancy has more than doubled. But, this has not necessarily been accompanied by an equivalent increase in healthy life expectancy. People are living longer but many of those years are burdened by chronic diseases such as heart disease, diabetes and even cancer. This is where it’s important to understand the difference between lifespan and healthspan. Lifespan is the total number of years we live whereas healthspan is how many of those years we remain healthy and free from disease.” Institute Public Health How do you…

31.03.2023

Nullius in verba “take nobody’s word for it”

The fund manager says we made 20% last year. Nullius in verba The advisers say, don’t worry, you’ll be fine. Nullius in verba Of course, individually we do not have the time, energy, experience and intelligence to question everything. We rely on others with an assumption of good faith. But from time to time, you need to question your good faith. Failing to do so means your good outcomes rely on luck. When it comes to allocating your capital for the future, for yourself and your family, then relying on help is not helpful. You need a much more thoughtful…

31.03.2023

Gold was never an “investment”.

The title is a comment made by an FT reader here. Gold was never an “investment”. It has always simply been an insurance policy against such unlikely events as major wars, galloping inflation, currency devaluations, or (if you are Russian) asset freezing and confiscation. The insurance policy you have on your house probably has a better yield! Gold gamblers are not investors. We have carried out due diligence and research on gold. The problem with gold is the lack of yield. You buy it on the basis it rises in price. It means over time you need to keep pace…

29.03.2023

If you invest with Schroders, Brewin, Coutts, UBS or any of the national wealth managers, as an investor, does the boss know you exist?

If you invest with Schroders, Brewin, Coutts, UBS or any of the national wealth managers, as an investor, does the boss know you exist? Of course not! Seth Godin uses this analogy “Small family farms have significantly higher yields than neighbouring farms that are much bigger. That’s because the individual farmer cares about every single stalk and frond, and the person with a lot of land is more focused on what they think of as the big picture. As a small independent company, we care. We pay attention and focus on the long term, not the short term just to…

29.03.2023

The credit Suisse debacle rumbles on…

“The wipeout of $17bn of Credit Suisse bonds has sparked panic among rich Asian investors who had loaded up on the risky bank debt. Under the terms of the UBS takeover of Credit Suisse, orchestrated by the Swiss government on Sunday, Credit Suisse’s additional tier 1 bonds were written down to zero while shareholders received $3.25bn.” reports the FT The good news “Retail investors in Europe do not typically hold AT1s, and they are barred from doing so in jurisdictions including the UK.” However, in Asia…“The selling included wealthy clients who owned the AT1s with leverage and were receiving margin…

22.03.2023

Should you be concerned about going direct to national wealth managers and banks?

I recently discussed the problems of Credit Suisse and Silicon Valley Bank. A few months ago these banks were selling their wealth management services to new customers. Potential customers were unaware of the risks. So…” Should you be concerned about going direct to national wealth managers and banks?” I am certainly not an expert in predicting whether any UK bank could fail and clearly, I don’t want any UK bank to fail for obvious reasons. However, customers do need to assess the risks better than they do at present. Credit Suisse and Silicon Valley Bank wanted you to go direct. So…

21.03.2023

Silicon Valley Bank and Credit Suisse…Both were selling Wealth Management services!

Here are 2 banks in the news. Both offered wealth management advice. They attracted customers to their services but failed as institutions. This is what SVB says “Your complex financial life demands expertise that’s as varied as your needs. Our capabilities mean we can take the holistic approach that suits your unique situation.” “We strive to serve the innovation economy better than anyone – understanding your unique journey, so that together, we can unlock new possibilities that move you forward, faster.” Credit Suisse says “Whether you’re investing, preserving, or transferring wealth, our wealth planning experts will craft bespoke solutions to…

20.03.2023

The Lifetime Allowance has been abolished…or maybe not!

You know the news about the Lifetime Allowance. You may also know Labour will reverse it. It’s a game of political tennis. That creates uncertainty. It feels like you get good news one minute, to then feel the rug metaphorically pulled from under you. So what action can you take? Anyone who has a pension fund that falls within the LTA rules tends to focus on tax. That’s natural. It often means the decisions you make regarding asset allocation tend to be tax focused. It is time to rethink that perspective. It’s also a time to rethink wealth management costs….

16.03.2023

What has open science to do with allocating your capital?

If you get a chance to listen to Stuart Ritchie talking to Helen Lewis on The Spark, BBC Radio 4… it’s only 30 mins. Stuart has written a book called Science Fictions. The focus is on Open Science. A form of radical transparency. In the BBC discussion, Ritchie talks about the scientific community having the assumption of good faith. Yet studies don’t tend to disclose core evidence which can make it hard for peer reviews to be clear. Why? Human nature is at play as no one really wants to upset other people. The phrase “debunking doesn’t make you popular”…

14.03.2023

A promise of inheritance has been withdrawn. Can I claim against my parents?

“My parents own a farm at which I worked for decades for low wages on the understanding that I would ultimately inherit it and be able to run it as a viable business. Even though there was no written promise of me getting the property, they verbally assured me I would inherit the farm. After a huge argument over my pay during the cost of living crisis, my parents removed me from their wills. This decision is devastating for my finances, drastically impacting my future plans. Should they be forced to give me compensation based on the value of the…

14.03.2023

Are you an AIM investor?

At the time of writing, tax breaks for UK investors willing to buy risky assets have come under scrutiny ahead of the Budget after finance experts called for the government to reconsider what policy objectives they achieve. “Reliefs shouldn’t just sit there forever. They should be looked at both in terms of amounts and in terms of whether we actually need them at all,” said Bill Dodwell, tax director at the Office of Tax Simplification, a statutory body, giving evidence this week to MPs on the Commons Treasury select committee.” says the FT Dodwell went on to say…”But their IHT…

07.03.2023

Your restricted adviser is unable to review existing products that you may already have in place.

According to the FCA: A restricted adviser or firm can only recommend certain products, product providers, or both. The adviser or firm must clearly explain the nature of the restriction. If you are not sure about the offer you should ask for more information. Some examples of restricted advice are where: the adviser works with one product provider and only considers products from that company the adviser considers products from a limited range of product providers the adviser is unable to review existing products that you may already have in place. Restricted advisers and firms cannot describe the advice they…

03.03.2023

Markets are mainly driven by narcissists, charlatans, consultants, snake oil salesmen tarot card readers and…

“Markets are mainly driven by narcissists, charlatans, consultants, snake oil salesmen tarot card readers and other self-proclaimed evangelists and gurus who believe they are blessed with numinous visionary powers. Ultimately nobody has a clue. Your average housewife could outperform most FMs and wouldn’t need the champagne or fast cars. Occasionally one of these soothsayers gets it right – a la broken clock. When you realise stupidity is the fundamental driver of behaviour, that’s where the opportunities are at.” This was an FT reader comment about this article in the FT. Wealth managers grapple with one of their worst years in…

03.03.2023

You made your will; you can relax and get on with your life. Wrong.

Making a Will is important but it is not the end of the process it is actually the start. If you make your Will today, hopefully, you are not going to die today. Your plan is to push that date to a long time into the future. That means, with good fortune, there is a long period between today and when you die. It means you can spend time thinking about living, not death. Whilst you live, you can reflect not on who gets what when you die, but what are the consequences. This is where an Estate and Succession…

03.03.2023

If there was a pill you could take that made your investments a success, would you take it?

It is hard going to the gym. Every time you go, it’s an effort. You get tired and probably ache afterwards. Yet you do it because of the outcomes. It seems crazy to think of a magic pill you could take to help you remain fit. You get the outcomes but with minimal effort. In the real world, we know that doesn’t work. In fact, there is a balance between the effort you put in compared to the output you benefit from. Without that balance, the equation doesn’t work. It is why you cannot delegate getting fit to someone else…

03.03.2023

65 per cent of investors frequently make investment decisions based on emotions. That’s costly!

According to Oxford Risk, a behavioural finance firm, after questioning 150 wealth managers, revealed 65 per cent of investors frequently make investment decisions based on emotions. Some 73 per cent say those emotional decisions have come at a significant financial cost to their clients. In fact, the majority of wealth managers say emotionally-driven investing costs their clients more than 100 basis points of investable wealth every year, on average. The advisers questioned collectively manage €327 billion across Europe. ‘The average investor probably costs themselves around 3 per cent per year because of behavioural decisions,’ says Dr Greg Davies, Oxford Risk’s…

03.03.2023

Are St James Place independent?

I recently met a salesperson from St James Place. (Yes, they are salespeople.) I asked if they were independent. They said, “Yes, we are independently owned. How can we help.” Actually, that may be legally correct. The salesperson was not lying. But the person knew exactly the substance of the question. They could have said, “No, we are not Independent Financial Advisers”. They should have said that proudly because St James Place has reasons why they are not Independent. It would seem fair and reasonable if the salesperson could explain why they were not Independent. The consumer could then be…

03.03.2023

My dentist charged me £60 for nothing

I sat in the chair, he checked my teeth and then charged me £60. I was in and out within minutes. I am not complaining about the service. Just fascinated by perspective. The dentist didn’t say to me… “The teeth we replaced last year, well, they might need changing again. They are not what we expected. What we need to do is replace them with new ones. Of course, there’s no charge for the check-up…all part of the service” If that actually happened each year, you may wonder if they are looking after your best interests. If you invest £500,000…

03.03.2023

How pathetic are UK fund managers?

Terry Smith has been in the news recently. Firstly, the news that he was paid £36m for one year and secondly, he blames central banks for his fund’s poor performance. In the melee of fund managers, Terry Smith has built himself a reputation for outperformance. Compared to many other fund managers, he has clearly outperformed them. So are they not pathetic? Why aren’t they all as good as Terry Smith? Imagine if there were 100 fund managers you could choose between (in reality 100 is scratching the surface). Out of 100, all the managers are bright intelligent people, and must…

03.03.2023

What is the difference between Fidelity, Jupiter, Artemis, Henderson, Rathbone, Schroders blah blah…

As an investor, can you explain, as Einstien once said, to a 6-year-old, what is the difference between all these companies? Fidelity, Jupiter, Artemis, Henderson, Rathbone, Schroders, Newton, Invesco, Legal & General, Prudential, Man, Brewin etc etc…and etc etc. How would you describe the differences? You may have some or all of these companies in your portfolio. Can you be clear about why? How do you explain why you invest with these companies? If you sit down and try to explain it or articulate it, can you? If you can’t differentiate between them, what does that tell you?

03.03.2023

Why We Need Independent Board Members

According to the IESE Business School “A CEO with too much power and too little supervision by the board of directors can put a company in danger, as recent financial scandals attest. This is why independent board members are vital.” They say …. The Ideal Board Member Ultimately, the goal of any board member is to defend shareholder interests. Doing this requires that board members exercise objective, sound, professional judgment. In this respect, being independent is crucial. Ideally, this role should be filled by someone who is loyal, able to avoid conflicts of interest, diligent, dedicated and who has a…

03.03.2023

“The products and services offered depend on the domicile of the client and the legal entity of Julius Baer.”

Julius Baer is a global wealth manager. There are many similar firms that operate throughout the UK and internationally. They all have similar websites and say broadly the same things. Here is one thing Julius Baer says “The products and services offered depend on the domicile of the client and the legal entity of Julius Baer.” What does that mean? At first sight, the focus is on your tax jurisdiction. But actually, the important words are “products and services offered “ In essence, Julius Baer offers both products and services. What is the difference between products and services? A product…

07.02.2023

What’s the Difference Between Estate Planning and Wills?

If you google ‘estate planning’, you’ll get various answers. According to Investopedia “Estate planning involves determining how an individual’s assets will be preserved, managed, and distributed after death or in the event they become incapacitated.” Will planning can be a relatively simple process that involves creating a last will and testament. In essence, Will planning forms part of your estate plan. Here’s a question. Whilst alive, and fully compos mentis, would you give control over all your assets to others? If you are not prepared to transfer power and control to your beneficiaries whilst living, what will make them any…

07.02.2023

Investigation opened after Usain Bolt spots ‘discrepancies’ in investments

How does this impact you? I’ll explain below, however, this is what the BBC reported. “A company which looks after Usain Bolt’s investments is under investigation after reports he may have lost millions of dollars to fraud. Jamaica’s Financial Services Commission (FSC) has placed the firm, Stocks and Securities Limited (SSL), in “enhanced oversight” following the allegations. The 36-year-old retired sprinter had investments with SSL for over a decade. Bolt’s manager Nugent Walker told the Jamaica Gleaner the eight-time Olympic champion had noticed “discrepancies”. It appears Usain Bolt noticed discrepancies. The question is therefore, why was it left for Usain…

19.01.2023

Norway fund chief warns at Davos of ‘very, very low’ returns for stocks.

Norway fund chief warns at Davos of ‘very, very low’ returns for stocks as reported in the FT. It is a time for some logic. The average wealth manager charges around 2% per annum (including trading, underlying funds etc etc and etc) If the return is 20% each year, you pay away 10% of your money for others to manage it for you. That leaves 18%. You’ll pay some tax and you get what’s left. If returns fall to say 5% per annum and you pay the same 2%, you pay 40% for the same job. That’s 4x as much….

19.01.2023

Beyond the 4% Rule: How Much Can You Spend in Retirement?

“One frequently used rule of thumb for retirement spending is known as the 4% rule. It’s relatively simple: You add up all of your investments, and withdraw 4% of that total during your first year of retirement. In subsequent years, you adjust the dollar amount you withdraw to account for inflation. By following this formula, you should have a very high probability of not outliving your money during a 30-year retirement, according to the rule.” Here’s an illustration. The description comes from this article by Schwarb The question is whether it’s fair or not. While the 4% rule is a…

19.01.2023

Advice plans under scrutiny after Peter Hargreaves’s criticism

Peter Hargreaves’s attack this week on Hargreaves Lansdown, (reported in the FT) the funds supermarket he co-founded, has not only raised awkward questions about the company’s strategy. According to the FT “The new advice service will involve giving customers personalised “nudges” or notifications on their phone with prompts to invest, or to hold more cash in a rainy-day fund, among other tips. The move would set Hargreaves apart from its rivals, including AJ Bell and Interactive Investor, which remain execution-only. Other low-cost entrants have popped up in recent years offering cheaper advice than the face-to-face support traditionally offered by wealth…

19.01.2023

Elizabeth Holmes Gets 11 Years in Prison. A warning for all investors…due diligence

“She pushed the envelope a little too far,” says Anat Alon-Beck, a law professor at Case Western Reserve University. “You fake it ’til you make it, but it was too much ‘fake.’” In terms of background, Holmes sought funding for Theranos, which she dropped out of Stanford University to launch, by claiming her technology would revolutionize the medical world, as it could use just a few drops of blood to scan for hundreds of diseases. She turned the startup into a $9 billion unicorn. But whistleblowers revealed Holmes had lied about the capabilities of her invention. Instead of saving lives, it…

19.01.2023

How to outperform the market by François Rochon

Over the last 30 years, he returned more than 6.000% to shareholders (15.7% per year). Have you heard of him? No, I thought not. Here is his investment philosophy. François Rochon is a quality investor. His investment philosophy is built on the following pillars: In the long run, stocks are the best asset class to put your money in Time in the market beats timing the market Only buy companies with a competitive advantage A lot of opportunities can be found in monopolistic and oligopolistic markets Focus on companies with high margins and high returns on capital Good long term prospects…

19.01.2023

Most millionaires invest in the stock market..

“Most millionaires invest in the stock market. But they don’t teach you how to build a successful portfolio in school. So let me show you how:” This was a headline from twitter. The twitter thread went on to give you ‘how’. The last thread said… “Level up your investing game today And join The Investing Masterclass Sessions I’ll show you exactly how to build & maintain a winning portfolio 70% off” There was a link to this. The Investing Masterclass Sessions Would you buy it? If someone is selling you a book or class telling you how to invest and make…

19.01.2023

“Show me the incentives and I will show you the outcome”

This famous quote from Charlie Munger gets straight to the point regarding the behaviour of individuals (and companies), and as vice-chairman of the hugely successful US investment firm Berkshire Hathaway, he is certainly someone who understands how this links to long-term financial gain. Nowhere do incentives play a bigger role than in the steering of a salesforce, with its successes and failures impacting heavily on earnings. Tracy Dewart tells Tara Siegel Bernard about what she discovered when she looked at the JPMorgan brokerage account being managed for her Alzheimer’s stricken elderly mother. From the New York Times: “After about six…

13.01.2023

Hands up…pick me, pick me.

There are thousands upon thousands of wealth managers in the marketplace. They say to investors ” Pick me, pick me. (well, they don’t really say that), We are the best ones to manage your money. We get the best returns. We are the nicest people. “ If you choose to delegate the management of your money to others, you also have to delegate the process of checking whether your wealth managers are doing what they should be doing. You need to audit their performance. We can explain how you check the success of your wealth manager. And if you haven’t…

13.01.2023

The more we pay, the more we appreciate it

Have you ever heard of the endowment effect? It is the finding that people are more likely to retain an object they own than acquire that same object when they do not own it. “One of the most famous examples of the endowment effect in the literature is from a study by Daniel Kahneman, Jack Knetsch & Richard Thaler, in which participants were given a mug and then offered the chance to sell it or trade it for an equally valued alternative (pens). They found that the amount participants required as compensation for the mug once their ownership of the…

13.01.2023

The trouble with intuition

A key insight that you can apply to your own decision making: resist “premature intuition” – the feeling you “know” something even if you are not sure why you know. In some cases, intuition is very useful for making instant decisions. In other, less time-critical situations, Kahneman says judgements based on intuitive feelings need to be disciplined and delayed. Act on intuition only after you have made a balanced and careful consideration of the evidence, he advised. As much as possible gather that evidence from diverse sources, and from people who have made their own independent judgement of the evidence….

13.01.2023

Do you write down your financial decisions?

It clears your mind and readies it for decision-making. It clarifies underlying emotions. It gives you a record of your development. You gain a sense of fulfillment. It helps you to enter the unknown. It helps you to take action. Whether you do your own investing or delegate to stockbrokers, private banks, wealth managers, or other investment advisers, it pays to write down your process. Getting your feelings and thoughts onto paper or computer clarifies thinking to help make better financial decisions.

13.01.2023

Any fool can know. The point is to understand.

If you are over 50 you can talk to Pension Wise. It’s a government initiative. It offers Free and impartial government guidance about your defined contribution pension options. I have a slight problem with the word “Wise”; it implies something that is not being delivered. Whilst obtaining information is important, and if you can obtain it free of charge, that has to be positive. Yet PensionWise is not advice, it’s guidance. Yes, you gather knowledge, but as Einstein says, it’s more about understanding, not knowledge. It is important to gather information and try to make sense of the information. Yet…

13.01.2023

Save tax by “buy, borrow, die” strategy,

What is a “buy, borrow, die” strategy? Under the “buy, borrow, die” strategy, a government may never get to tax the capital gains on an asset. Wealthy individuals, during their lifetimes, borrow against their stock holdings instead of selling them, and then bequeath them to children, for whom the capital gains basis is revised up to the market value at the point of inheritance. If you own a property portfolio, you could …borrow and die—the same principle. What if you have assets in a trust fund, could you borrow? —the same principle. The FT highlights the story of John Foley,…

30.12.2022

Do you use a wealth manager?

You use a wealth manager or you are thinking of using a wealth manager. If so, why? It doesn’t matter which wealth management firm you choose, but if you were asked to articulate why, could you do it? What criteria did you apply to make the right choice for you? And why is it important to know? It is vital you know why as you need to measure success. If you do not measure success, you suffer the consequences. Without measuring performance, you don’t do better than mediocre. Even if an organisation appears to be performing well, that’s not guaranteed…

16.12.2022

Pre-Mortem of Investment Portfolio

In Michael Mauboussin’s book, Think Twice: Harnessing the Power of Counterintuition, there’s a great passage on how investors can make better investment decisions using what he terms a ‘premortem’. Here’s an excerpt from the book: Many people are familiar with a postmortem, an analysis of a decision after the outcome is known. For example, teaching hospitals hold morbidity and mortality conferences in order to review mistakes in patient care and to modify processes of decision making. But Gary Klein, a psychologist, suggests what he calls a premortem, a process that occurs before a decision is made. You assume you are…

30.11.2022

Are investment second opinions worth it?

If you use wealth manager A Ltd to look after your money, is a second opinion from wealth manager B worth it? The answer is…NO It is in the interests of wealth manager B to persuade you that they are better than wealth manager A. The chances are that the second opinion is biased. It probably does not make sense to act on what wealth manager B tells you. Why? If you follow the logic, you could ask wealth managers C,D,E F, etc etc…each one will have their reasons why they should manage your money. However, there is nothing wrong…

16.09.2022

Does your wealth manager act in your best interests?

“You’re either guilty or you’re not” You can’t be a little pregnant… you either are or you are not” Black and white. You either act in a client’s best interest or you don’t. If only… The world of finance and wealth advice navigates against black and white—instead, it’s all shades of grey. Wealth Managers like the concept of being a little pregnant! Your adviser may say, of course, they act in your best interests, but if they work for a wealth manager selling restricted advice, can that be true? ( A little pregnant) What if an adviser or wealth manager…

15.09.2022

A summary of the consequences of not measuring performance.

Stacy Barr is a performance measurement specialist. She lists in a blog some answers from her readers. Here is a list. They are not specific to investment management, it is a matter of applying these concepts to how you measure your success when you invest. Without measuring performance, we’re doing no better than guessing. Which means we’re giving up any control over performance. Without measuring performance, we can’t know if our actions are working or not; if our expenditure of time and money is making the difference we want, no difference at all, or making things worse. Without measuring performance,…

28.07.2022

On bullshit in investing

“The investing industry is ridden with bullshit. The most common and insidious form is over-optimism: offers of tantalizing risk/reward that defy any notion of reality, often based on misinformation or deception. Less common but even more dangerous are outright frauds. The problem is inherent to the product. Most consumer goods – apples, hotel rooms, laptop computers – are tangible objects or services that you can see, taste, feel, or experience, so you can judge how much they are worth to you. Investments represent claims about some future probability distribution of monetary outcomes which are not literally verifiable. The best an…

27.07.2022

Why do companies have independent boards?

The CFA Institute Viewpoint is …”Company boards should have an independent majority. An independent majority on the board is more likely to consider the best interests of shareowners first. It also is likely to foster independent decision-making and to mitigate conflicts of interest that may arise.” Deloitte say “…a growing number of privately-owned companies have opted to have boards with independent board members, believing that the perspectives and insights that they can bring to the company far outweigh any constraints. While some companies choose to include independent board members on their board of directors, most appoint them to a board…

15.07.2022

The biggest challenge of retirement

In an article by George Jerjian he discusses ‘Retirement’. “Retirement means different things to different people. I did a deep survey of more than 15,000 retirees over the age of 60, and asked them one question: “What is your single biggest challenge in retirement?” Below is a small selection of responses I received under the most cited categories: Regret: “I miss doing the work that I love.” “I don’t think retiring is for me. I want to go back to teaching.” “I’m not sure what to do with my time. I feel lost.” Health: “Keeping my mind healthy and adding…

08.07.2022

“How a Japanese concept saved me from a depressing retirement”

The Japanese concept of “ikigai,” which translates to “your reason for being. The Westernized version of this concept is based on the idea that there are four components a person must have complete to achieve ikigai. Each concept is represented by a question. As you actively pursue what you enjoy doing in service of yourself, your family, and your community, think about whether that activity allows you to answer “yes” to any combination of those four questions: Are you doing an activity that you love? Are you good at it? Does the world need what you offer? Can you get…

04.07.2022

The Psychology of Decision-Making

There are numerous psychological factors that influence financial decision-making. One of the most prominent is the fight between the current self versus the future self. Here’s a classic example: “Do I spend my £5,000 bonus and take my wife on a dream vacation or do I save and invest it for a trip in 20 years?” Your current self’s response: “This is a no-brainer! You clearly take your wife on a dream vacation and enjoy the moment now. Your future self in 20 years will be able to take care of himself. Plus, what happens if you don’t even live…

27.06.2022

When you speak to a financial adviser or wealth manager, what do they want from you?

Your money. They want to tell you how they are great at looking after your money. That their firm is the right company to look after and manage your money. In fact, it’s what you should expect. If you want to delegate all your money decisions to others, the world is your oyster. There is not one firm ‘head and shoulders above another. Yes, some charge more than others, but there is no one firm that you can employ that will consistently generate the best returns. In reality, you’ll end up with average returns. But….what if you want some control…

24.06.2022

If someone wants to improve their net worth by 50%, improve your communication.

Warren Buffet famously said that if someone wants to improve their net worth by 50%, improve their communication. Here are some words from Brian Morgan. It’s from a Linkedin post here “I’ve been reflecting: he didn’t say (but I will) that there is an inherent criticism of academics, media, and business, in the statement. He seems to be indicating (correctly, I believe) that our current level of communicating our ideas is suboptimal to the idea. And if we were to take on the task of communicating better, we would improve the outcomes inherent in the idea—which already exists. He didn’t say…

24.06.2022

I like the cool website for my ISAs

It was a statement that came out of a conversation. The reason for using a particular ISA provider was based on the user experience of the website platform. It was not to do with investment outcomes, risk management or even costs, but usability. There is nothing wrong with having a good user experience, but the question is what are you paying for? If you allocate your capital for investment, what are expecting your managers to do for you? Are you focused on what outcomes they can achieve for you? Probably when you first invest, you try to check out performance…

24.06.2022

It takes curiosity to learn. It takes courage to unlearn.

It takes curiosity to learn. It takes courage to unlearn. Learning requires the humility to admit what you don’t know today. Unlearning requires the integrity to admit that you were wrong yesterday. Learning is how you evolve. Unlearning is how you keep up as the world evolves. Adam Grant When you invest, it is so easy to feel relieved. It’s done. You may get annual reviews to explain you are on course, but you don’t need to do any ‘big’ thinking anymore. The reviews are like filling your car with fuel…each time you fill up, you don’t need to rethink…

24.06.2022

Why do investment firms tell you what are their ‘bestselling’ funds?

You know the story. Here’s our ‘XYZ” fund. It’s performing great. Everyone is buying it. It’s a story about why you are not buying it. If everyone else is buying, are you not afraid of missing out? Its FOMO. Why do investment firms promote best-selling funds? Most investors don’t do due diligence on funds. Why? It’s like lifting up the bonnet on your car… all you see is just a pile of metal and plastic. How are you supposed to know what the engine should look like? Instead, if everyone else is buying it, they can’t all be wrong, can…

24.06.2022

Ask to see your fund managers managed funds before you employ them.

Most investment groups have a whole range of funds you can choose between. It’s great marketing. You have so much choice. Every fund management group plays the same game. It means they can offer you numerous options, just like the choice of groceries you get from Asda, Sainsbury’s, Tesco, Waitrose etc… You may employ someone to design your portfolio and choose the funds for you. This is typical with the big wealth managers as they provide restricted services. It also feels more bespoke to you. Someone designing and building your own portfolio. Wow. But…yes there is a big one. If…

24.06.2022

Adviser or salesman?

“The key takeaway, then, is to look for a firm that has your best interests at heart. In short, you need an adviser, not a product salesman. Don’t be afraid to ask difficult questions. For example, How are you paid? Do you receive commission for the funds you recommend? And how do you ensure that clients receive good value for the investment costs that they incur? Also make sure that the adviser you are considering hiring believes in proper financial planning. “Financial planners,” says Mark Minchin, “invest time in getting to know each client’s situation — understanding their needs, goals…

24.06.2022

Is your investment adviser firing on all cylinders?

“You wouldn’t expect to buy a new car without first taking it for a test drive. Likewise, any car owner knows that they’ll get the best from their vehicle if they service it regularly and keep it in a state of good repair. Given the complexity of modern engines, for most of us that means bringing in the mechanic. Each of these arguments holds equally true for defined benefit pension schemes, trustees and their investment advisers, whether they be consultants or fiduciary managers. For the avoidance of doubt, in this analogy trustees own the car, and they need to be…

24.06.2022

It’s a story about Gordon….

This is a story from Paul Armson. Whilst Paul is marketing his services, the point of the story illustrates how more people are starting to question the services of advisers or private bankers or stock brokers or wealth managers. Historically, commissions were hidden. Today they are transparent, but people still fail to ask good questions about value for money. The big wealth managers are very good salespeople. Gordon, below, needed to be rescued from someone he trusted but wasn’t providing value. It means even if you like and trust your adviser, that is not enough. “I recently arrived at a…

21.06.2022

Personalised Investing ‘Coming at Us Like a Freight Train’

In the US, Charles Schwab CEO Walt Bettinger said” Personalized investing is coming at all of us like a freight train,” At the Schwab Impact conference, he told viewers: “The idea that I’m going to take my money and simply turn it over to some fund or an ETF and just trust that that manager or maybe trust that that index is going to invest the way I want” is no longer realistic. “I won’t go so far as to say those days are gone … but they’re going to be challenged because technology is bringing the opportunity for personalization…

12.05.2022

Financial Planner is Like An Architect

Architects design and build real houses. Similarly, financial planners design and build your financial house. Job Description Architect: “I work on new buildings in the regeneration of an area, design alterations to existing buildings, or advise on the restoration and conservation of old properties.” Financial Planner: “I work on client’s financial matters, design alterations to existing financial plans, or advise on the importance of having realistic financial goals“ Architect: “On every project, I work closely with other professionals, including engineers and surveyors, to make sure that their buildings meet the necessary standards.” Financial Planner: “On every project, I work closely with other professionals, including accountants,…

12.05.2022

Why families need to talk about family wealth, otherwise poor decisions can be made.

I want to copy a reader’s comments to an article in the FT. The article discusses massive problems with the wealth management industry. “When my father in law died, my mother in law hired a WM on personal recommendation. She’s progressively moved all of her money under the WM’s wing. She tells me her investments are doing really well, but she can’t tell me how much they’re up and she doesn’t know how much she’s paying in fees (she says she has documents, but she won’t let anyone in the family see them). The WM takes her out to lunch…

12.05.2022

Is your financial adviser like Jordan Belfort, The Wolf of Wall Street?

If you have ever watched the film with Leonardo de Capri playing the lead role based on the story of Jordan Belfort. In the film, the last person you would want to deal with would be Jordan Belfort. It is easy to know when he’s more interested in making money for himself than his clients. A clear lack of integrity. And it’s easy for us all to see. Yet, thousands of investors believed him at the time. They couldn’t see his lack of integrity. They didn’t know the commissions paid. They had no idea of the risks. But they loved…

12.05.2022

Top 10 ways to make better decisions

Most of us are ignorant of the mental processes that lie behind our decisions, but this has become a hot topic for investigation, and luckily what psychologists and neurobiologists are finding may help us all make better choices. Here we bring together some of their many fascinating discoveries in the New Scientist guide to making up your mind. Here’s 1 of 10 1 Don’t fear the consequences Whether it’s choosing between a long weekend in Paris or a trip to the ski slopes, a new car versus a bigger house, or even who to marry, almost every decision we make…

12.05.2022

Do you get fit if someone else exercises for you?

What? That doesn’t make sense whatsoever. The only way to get fit and healthy is to do it yourself. Delegation of fitness never works. Yet thousands of investors delegate their investment decisions to others. It comes at a price that many don’t really appreciate. Want to make great financial decisions? Let’s have a conversation.

12.05.2022

The 1 Percent Rule: Why a Few People Get Most of the Rewards

“Sometime in the late 1800s—nobody is quite sure exactly when—a man named Vilfredo Pareto was fussing about in his garden when he made a small but interesting discovery. Pareto noticed that a tiny number of pea pods in his garden produced the majority of the peas. Now, Pareto was a very mathematical fellow. He worked as an economist and one of his lasting legacies was turning economics into a science rooted in hard numbers and facts. Unlike many economists of the time, Pareto’s papers and books were filled with equations. And the peas in his garden had set his mathematical…

12.05.2022

You are the only one you can rely on to save yourself when investing

“Doctors won’t make you healthy. Nutritionists won’t make you slim. Teachers won’t make you smart. Gurus won’t make you calm. Mentors won’t make you rich. Trainers won’t make you fit. Ultimately, you have to take responsibility. Save yourself.” @naval

12.05.2022

Every day you think about what healthy food to eat. Every day you exercise. Why?

It’s okay to eat takeaway food, the unhealthy kind because it’s just one day. It’s also okay not to do exercise, even if it’s a walk today because it’s just one day. Most people realise that eating the wrong food and not exercising for one day don’t have long term implications for your future lifestyle. You also recognise, that if you ate unhealthy food every day and never exercised, your future health and well being would be a disaster over time. Its good habits v bad habits. If you think about your health every day, guess what, your future looks…

12.05.2022

If common sense was common, then most people wouldn’t make the kinds of decisions they do every day.

Common sense is neither common nor sense. There’s not a whole of sound judgment going on these days (though whether it is worse than in the past, I can’t be sure), so it’s not common. If common sense was common, then most people wouldn’t make the kinds of decisions they do every day. People wouldn’t buy stuff they can’t afford. They wouldn’t smoke cigarettes or eat junk food. They wouldn’t gamble. And if you want to get really specific and timely, politicians wouldn’t be tweeting pictures of their private parts to strangers. People wouldn’t do the multitude of things that…

12.05.2022

What would happen if wealth managers told the truth.

If there are thousands of wealth managers, then some would be at the top of the performance table, and some would be at to bottom. Logic, obviously. How would you react if your wealth manager said “we were near the bottom “or”we are bottom”. You would probably say to yourself, “It’s time to move elsewhere”. In reality, thousands of wealth managers will never say where they are placed. If they said, “we are average”. But how would you respond to being average? You may say ” So you are telling me you are just average…so that means there are lots…

12.05.2022

Do you buy a holiday home?

If you have the available capital, do you buy a holiday home? Do you upgrade your existing holiday home? Do you let out the property? Are you buying a holiday home for pleasure or investment? Does it matter either way? Are the running costs fully taken into account? Are you better off renting? What about foreign ownership rules and death? Do you buy in a limited company? How is the home transferred on death to beneficiaries? Do you employ an agent to rent? What about tax? These are only some of the questions you need to address. It’s our role…

12.05.2022

Are your fund managers charging performance fees?

I understand the sales angle. “You buy into our fund and if we perform then we win along with you. It’s what we call a win-win.” It seems a perfectly reasonable way of investing. It can also appeal to our sense of fairness. It is crass. I carried out some research for a client on a fund only to find it was subject to a performance fee. The last time it was paid was in 2018! So what do we learn? If you allocate your capital to funds that have performance fees, are you paying them now? Part of the…

12.05.2022

Are you investing into Private Equity?

According to Preqin Assets under management, will surge to more than $17tn by 2025. They expect AUM growth in alternative assets to average 9.8% per year to 2025. Persistently low-interest rates will attract investors of all types drawn to the promise of outperformance, diversification, and lower correlation with public markets. Their forecast is supported by their Future of Alternatives 2025 survey, in which 81% of investors said they expect to increase allocations to alternatives. The private equity story can be great; it can also be dreadful. If you decide to allocate any of your capital to private equity, the level…

12.05.2022

My son recently had the opportunity of baking cakes

My son recently had the opportunity to bake cakes at school for the very first time. They were dreadful! What would happen if you got to bake cakes and no one tasted of them? Year after year you keep baking cakes, but no one tastes them. You’ll probably imagine your cakes are fine. But what if they were not? What a wasted experience if you don’t get feedback. When you save for retirement, those who manage your money may not be impartial. They may say, you are doing fine because it’s good for them. You need to find out, metaphorically…

12.05.2022

Has this happened to your investments?

Your wealth manager, financial adviser, stockbroker, private bank, and investment manager each year, each quarter or each month come to you with new investment opportunities. The new opportunities have a great story. You should sell the shares not doing well and take the opportunities to invest in the new ones. If you follow the logic, and you’ve sold all the poor shares in your portfolio, you should be left with only the good ones. Your portfolio therefore should be outperforming by big margins. Yet next month, next quarter, next year, you get the same old story. You need to get…

12.05.2022

Don’t compromise on financial advice.

We are the best people to talk to about helping you make the best financial decisions. Yes, you would expect us to say that. Equally, if you have the time and patience, and asked 1000 financial advisers, wealth managers, stockbrokers, and private bankers….every single one will give you the same answer. If everyone gives you the same answer, how do you know who to choose? It is clear that knowing who to employ to help you is a minefield. The hardest job of any individual when seeking advice is to know the difference between good, average, and poor advice. How…

12.05.2022

You don’t get a tape measure to monitor your investments.

“An adult’s waist should be less than half their height to reduce health risks, health body NICE recommends.” According to the BBC, If you’re 175cm (5ft 9 inches) tall, for example, then your waist measurement should be less than 87.5cm (34 inches) – or half your height. The latest estimates for England suggest that 28% of adults are obese and a further 36% are overweight – a problem that is costing the NHS more than £6bn. I find the statistic that “only twice around your waste is about your height” is not easy to process. I imagined that your waste…

12.05.2022

Does using a private bank like Coutts make you feel good?

According to the bank, Coutts said it added 2,000 clients during 2021, delivering a £3bn increase in assets under management. Other than the sales pitch, “We are The Queen’s banker”, what else are they selling better than anyone else? Are they delivering consistent outperformance? If you really want to know, we can help you dig deeper for your answer. We all want to feel important, but it needs to be genuine rather than marketing. If you just want to tell everyone you are with Coutts, that’s perfectly fine. And you get to tell people or show them your Coutts card. …

12.05.2022

I watched a video presentation from a finance professional about trusts…

They were advocating gifting money through a trust prior to transferring assets to their daughter. So, rather than gifting assets to their daughter as an outright gift, instead, the plan was to gift assets into a trust. Then the trust could lend money to the daughter. She could use the funds as a deposit on a property. The sales angle was great. By gifting into a trust, after 7 years the assets fall outside the parents’ estate for Inheritance Tax. Good news. If the daughter’s relationship broke down, the assets could be protected as they were a loan from the…

12.05.2022

What is Kingsbridge Asset Management and how did its empire come crashing down?

In 2018 the Daily Mail wrote “Once held in high esteem, Kingsbridge Asset Management was at the heart of football and other sports for more than 20 years. Two key advisors, Kevin McMenamin, 61, and David McKee, 60, were so trusted that some clients asked them to be godparents to their children. They were familiar figures at football grounds in the early 1990s and their business grew thanks to word-of-mouth among cash rich sportsmen. One of their best known products was a niche film investment which relied on tax rebates from the Government. Six former cricket captains, including Michael Vaughan,…

12.05.2022

“We outperform, so paying more to get more works.”

In the investment world, I’ve heard the argument so many times, ‘we outperform’, so paying more to get more works.’ And the words “You get what you pay for” are often touted. Patrick Hosking of the Sunday Times said: “There should there be red faces at Schroders over their swanky green offices?” He says “I’ve visited an awful lot of swanky head office buildings over the years, but few come close to the lavish new office block designed and built for Schroders, the FTSE 100 fund management group, in the City of London. There are the 11 garden terraces spilling…

12.05.2022

Perceived Risk vs. Real Risk: A Key to Successful Value Investing

Value investing involves searching for investments where the perceived risk is greater than the real or actual investment risk. All investments have a certain amount of real risk that must be assumed when owning an asset. It is the risk perceptions of the marketplace (buyers and sellers) that determine the price of an asset. The price of an asset may be greater or less than the intrinsic or real value of an asset. The difference between the real risk and perceived risk determines whether the price of the investment is higher or lower than the real value. Mr. Market lets…

12.05.2022

Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime

You know what the story is about. Think about your net worth; your money; your investments. If you take control of your money, it can last you a lifetime.

12.05.2022

How we fool ourselves.

“Homines quod volunt credunt.” Its a quote by Julius Ceasar. It means, “Men believe what they want to.” It is striking that this was said over 2000 years ago. So have we taken on board this wisdom in 2000 years! Tim Harford, of the FT, writes a wonderful essay about the subject of fooling ourselves. It’s certainly worth a read. Here’s the link. Harford says “The French satirist Molière once wrote that “a learned fool is more foolish than an ignorant one”. Modern social science suggests that Molière was right. Why is this important? The job of wealth managers, bankers,…

12.05.2022

As a St James’s Place investor with less than £100,000 we think you’ll probably get good value but…

If you have more than £100,000 with St James Place, it’s time to review your decision. There is numerous evidence that explains the costs and performance issues at SJP. You can read more here. However, if you have up to £100,000 invested, what you pay to SJP may be reasonable for the advice. SJP partners whilst promoting advice are paid based on the assets they manage or the products they sell. The problem starts when the underlying costs are more than the value of the advice. As a rule of thumb, as soon as your assets with SJP are in…

12.05.2022

Half of UK adults need ‘urgent help’ managing their money

It says half. 1 in 2. 50%. However you write it, it is rather daunting to acknowledge. That’s 1 in 2 who need help. 1 in 2 that have recognised they need help. According to the FT, “Financial education must be seen as a core element of the government’s skills agenda and must be firmly embedded in our education system,” said Robert Halfon MP, chair of the education select committee.” Now comes the hard part. Who is doing the educating? It will take years for the government to introduce systems of education. This means it falls on those services being…

12.05.2022

Cryptoassets..Regulation.

Before you invest in cryptoassets you should be aware of the following: cryptoassets are considered very high risk, speculative investments if you buy these types of cryptoassets, you are unlikely to have access to the Financial Ombudsman Service (FOS) or the Financial Services Compensation Scheme (FSCS) if something goes wrong if you invest in cryptoassets, you should be prepared to lose all your money Before using cryptoassets to make payments, you should be aware that: the cryptoassets/service you are using may not be regulated you are unlikely to be protected if something goes wrong – for instance you are unlikely to have access to the FOS or the FSCS…

12.05.2022

Deutsche Bank in money laundering investigation

Many people employ banks to manage their investment assets. To be fair, the banks have superb marketing. Take a look. They are good at persuading customers to let them manage clients’ assets. The FT ran an article about the raid on Deutsche Bank. Here is the link Yes, you can see the article title….money laundering problems. If you google banks and money laundering issues, it’s more frequent than you may think. Why are the banks doing things they probably shouldn’t? Should investors turn a blind eye? Should you check the integrity of the institution that manages your money? We make…

12.05.2022

Crypto’s evolution adds new risks. Are your eyes wide open?

As reported in the FT, “Crypto’s critics see this development as yet more evidence of a bubble that is bound to burst. Fabio Panetta, member of the executive board of the European Central Bank, last month compared digital assets with a Ponzi scheme. “Crypto evangelists promise heaven on earth, using an illusory narrative of ever-rising crypto asset prices to maintain inflows and thus the momentum fuelling the crypto bubble,” Panetta said in a widely-reported speech.” I recently noted that “When you allocate your capital into Bitcoin or similar, where does it go? Who is using your capital? How are returns…

12.05.2022

UK retail investors have rushed to withdraw money from investment funds

According to the FT “UK retail investors have rushed to withdraw money from investment funds this year, with net outflows in the first three months hitting £7.1bn, the highest level since the fourth quarter of 2018.” Hargreaves Lansdowne says “The market reaction to the devastation in eastern Europe was extreme volatility, and while many investors took the opportunity to take speculative bets, many chose to take their money off the table and turn to the perceived safe havens of cash and gold” And..” [Our] clients have also turned to multi-asset funds which prioritise capital preservation, outsourcing asset allocation in the…

12.05.2022

I have been a Mercedes owner for a number of years…

I have been a Mercedes owner for a number of years. Let’s imagine that you purchased a new Mercedes for £50,000. Would you purchase the same car for £150,000. It actually seems madness. Of course, you wouldn’t. You would only pay the difference if you were getting something extra, not for something that was identical. Yet in the world of investment management, families throughout the world when investing in ISAs and pensions are doing just that. They’re paying for something they are not getting. In fact, investors are buying stories. Stories that seem like buying a car for £150,000 is…

12.05.2022

“You drown not by falling into a river, but by staying submerged in it.” Paulo Coelho

It’s OK to make investment mistakes providing you know they are mistakes. Understanding why the mistake was made and learning from that experience clearly helps in your next decision. The key message is knowing if you have made a mistake or not. How do you know? It’s difficult. If it was easy, investors would take action. Sadly, most are submerged slowly drowning. We can provide you with questions to ask your stockbrokers, wealth managers, and private banks…to help you identify mistakes. Interested?

12.05.2022

DIY or delegate

You have invested your time and effort into understanding your financial problem. The next decision is whether you fix it yourself or delegate it to someone else. In the world of wealth management, the solution to any problem is the wealth manager. It’s a little like the hammer and the nail analogy. You are concerned about retirement; the wealth manager can manage your money. You’ve just received an inheritance, the wealth manager can manage your money. You are recently divorced, the wealth manager can manage your money. You have sold your business, the wealth manager can manage your money. If…

01.03.2022

“If the only tool you have is a hammer, you tend to see every problem as a nail.”

This is a famous quote by Abraham Maslow which refers to a concept commonly known as the ‘law of instrument’ or Maslow’s Hammer. It refers to an over-reliance on a familiar or favourite tool. While such tools can be very useful at times, over-reliance can result in approaching problems in ways that are not always helpful or even destructive. In psychological terms, this might involve relying on the same coping mechanisms when faced with certain problems, rather than using new solutions. This over-reliance can often maintain psychological difficulties and inhibit processes of change. In the world of wealth management, whatever…

01.03.2022

Challenge your thinking

In the world of wealth management, when you meet an adviser, you will have certain expectations. How they dress, talk, look, smell…what language they use. In fact, they will present to you what you feel is important to you. In other words, you often get what you want to hear. What if they spoke to you in a language you did not understand, their dress was unkept and scruffy, or they had unpleasant body odour…these are signals you don’t want to see or hear. And most of all, you’ll not trust or believe what they say. If you can allow…

01.03.2022

Why conversations are important.

When you talk to a financial adviser, wealth manager, private banker, stockbroker, or other advisers, in most cases they will make you feel important, but you’ll also gain knowledge. They understand that conversation and relationships are important. If we take a leaf out of 19th-century philosopher, John Stuart Mill’s book. By opening ourselves up to a discussion of new ideas and opinions – even ones that we disagree with – we get a deeper understanding of topics and issues that we might otherwise take for granted. Information shared through conversation could change our points of view, or validate our original…

01.03.2022

It’s not “Are you independent?” but “Why are you independent?”

Imagine you approach a national wealth manager. The odds are they are not independent. Thousands of investors don’t seem to care about independence. Why is that? These firms explain that they have an investment universe that has been selected from thousands of companies and funds. In fact, the range of options is significant. On that basis, an independent adviser might have access to more funds but in reality, they will limit the funds they use. The wealth manager is implying, there is no benefit in being independent. I have to agree. Some firms are independent but their business model is…

18.02.2022

Executives Are Quitting to Spend Time With Family

It is the title of an article from the New York Times. “At the highest levels of corporate America, top executives are reassessing the role of work in their lives, stepping back and walking away. Some were burned out. Some were unhappy. Some were disillusioned. Some wanted their lives back. Some truly and genuinely wanted to spend more time with their families. All, in their own ways, decided that they’d had enough with the intense demands that come with being a senior executive, and walked away.” Do you want to change your life? This article gives examples of executives who…

17.02.2022

Ricky Gervais on the price of milk

Ricky Gervais – “The next time a journalist asks me how much a pint of milk is worth, I’ll give them a grand and say “run and get me one”. If you are used to filling up your car with petrol and it’s £100, you’ll be shocked if the new price is £350. You buy a loaf of bread which now costs £10. You’ll be shocked. You have a means of comparison. You can compare what you usually pay against what you are asked to pay today. This information helps you decide if you are prepared to pay that price…

16.02.2022

Do you want to be told what you want to hear?

You approach a wealth manager, but you find they are too condescending. They are more interested in themselves than you? It’s like you are not good enough? What do you do? No matter how smart or good they are, the chances of you giving them your money are zero. Yes, zero. Zero. Do you want to be told you are smart? Open-minded? Positive? Generous? Kind? How many superlatives do you want and or need? Now ring a wealth manager and what if they tell you what you want to hear… they tell you you are smart, open-minded, positive, generous, kind……

16.02.2022

You only have to get rich once as they say…

“Druck is the greatest money manager of all time, I believe. Compounding at 30% for over 30 years is in itself remarkable..doing it in size, managing billions is what makes it truly unique. That said, as he has stated himself many times in recent years..he has gotten too cautious and too bearish with age. At least he is aware of his own biases. You only have to get rich once as they say…” It’s a reader comment on this article Stanley Druckenmiller is a trading genius, and that’s why we should stop listening to him. 30% per year for 30…

16.02.2022

UK inflation picks up to highest rate since 1992

According to Valentina Romei of the FT, “UK inflation has accelerated to the highest rate in 30 years, squeezing living standards and putting pressure on the Bank of England to raise interest rates again.” Economists polled by Reuters expected CPI inflation to remain at 5.4 per cent and core inflation to increase to 4.3 per cent. How will this impact your investments? If you have a balanced portfolio, which means you have exposure to bonds, you have a decision to make. According to Bloomberg at the time of writing, the yield on UK Gilt 30 Year Yield is 1.63%. But…

16.02.2022

What is contrarian investing?

Barclays explain the following… “Market volatility understandably spooks some investors. For such individuals, the thought of staying in the market when there are significant downward swings in prices, let alone increasing their allocation to shares, may seem unthinkable. But some investors, known as ‘contrarians’, do just this, going against the crowd and focusing on unloved and under-appreciated assets and sectors. How contrarian investing works If stock markets are rising, the temptation is to ride it out for as long as possible and hopefully enjoy some gains. However, if the market is falling, your gut reaction might well be to get…

16.02.2022

Surge in underperforming funds on ‘Spot the Dog’ list

According to Joshua Oliver of the FT, “The amount of UK savers’ cash languishing in underperforming funds has jumped to more than £45bn, according to a report by Bestinvest, which warns that more turbulent markets will increase the pressure on active managers to prove their worth.” The table shows the biggest culprits. The point is why. Why do investors accept allocating their capital in dog funds? Of course, we know why. The investors in dog funds have delegated the investment of their money to others and do not check whether they are being successful or not. Whilst most people invest…

15.02.2022

Why it pays to regret investments

Regret. Generally, it’s looked at as something bad. You made a decision, now you regret it. “How I wish I had not done it that way.” Eric Barker has written a newsletter about regret in general. It also discussed Daniel Pinks book called The Power of Regret: How Looking Backward Moves Us Forward The premise behind Barker’s newsletter is that regret is good. In a 2008 study, psychologists asked people about negative emotions like anger, anxiety, boredom, disappointment, fear, guilt, jealousy, regret, and sadness. The one they experienced the most? Yup, regret. And which one did they value the most?…

15.02.2022

Ronaldo or Messi?

Is your investment manager the equivalent of Ronaldo or Messi? It’s a story about expectations. Your fund manager goes into business because they want to become in investment terms Ronaldo or Messi. They don’t go into the business to become a non-descript player in the third division. The chances are however, they will be a non-descript player in the third division. They may have a great game from time to time…score a success on the odd occasion, but they are not Ronaldo or Messi. As an investor, if you could find the next Ronaldo or Messi. to look after your…

15.02.2022

“Let’s buy private equity to generate returns”

If you are not getting the returns you expect, do you move into different forms of assets…perhaps private equity? Michael Mackenzie writes in the FT that capital may look to private equity to boost returns. Whilst at face value it’s a good story, it doesn’t come without risk. What happens if a wall of money looks to private equity for greater returns? Well, just revisit economics 101; demand and supply. You could overpay. Whilst most investors will require investment guidance for access into an alternative asset class, it’s still opaque. There is no substitute for investment due diligence especially if…

15.02.2022

What has alcohol to do with investing?

I enjoy a drink of alcohol. Various studies explain what may or may not be good for you. But we all know how much is too much alcohol, however, our definitions of what is too much may differ between us. Too much alcohol over time will impact your liver and increases the risk of other diseases. The actions you take today will have an impact over time. When you invest for retirement or invest so that you don’t run out of money, irrespective of your age, it’s easy to ignore today. ( who cares if you have that one extra…

15.02.2022

Can you afford to retire?

If you have investment assets and pension funds designed to generate income in retirement, the traditional route for income is bond funds. But if bond yields are low, will you be able to meet your expenditure needs? All insurance companies use bonds to provide the certainty behind annuity payments as they are guaranteed for life. So if you want more certainty, bonds are important. Here lies a dilemma. Long-term income peace of mind against expenditure lifestyle. At present, something has to give. What are you prepared to compromise on? As you get older and perhaps find it harder to understand…

15.02.2022

How does your fund manager make decisions with your money?

I listened to a fascinating webinar to explain outperformance by fund managers. The key focus described was ‘conviction’. In other words, fund managers use conviction in the decisions they make with your money. Conviction is an emotion. As such, emotion plays a large part in what fund managers and traders buy, sell and hold. Does that surprise you or not? Could it be argued that conviction is a little like placing a bet. The bet may succeed, but it may not. As such investment managers have to decide how much conviction to apply. Bearing in mind if they are wrong…

08.02.2022

When do you find out you made a mistake with your investments?

If you knew a mistake had been made today, you would change it today. Obvious. But if you’ve not changed your investment today, you have no reason to believe you’ve made a mistake. So if there is no reason to change today, what will change tomorrow or next week or next month…or the next 25 years? What triggers do you have in place to identify mistakes that can be fixed?

08.02.2022

You have seen the adverts, “If you have £500,000, we’ll give you 99 retirement tips.”

What do these product providers want? They want you to have a minimum of £500,000 that they can invest in your retirement. Is that what you want? Yes we all know it’s important to accumulate wealth, in pensions ISAs, property, in fact, it doesn’t matter where it’s invested, just as long as you have enough assets to generate income when you stop working. Some people may need £20m or more, some less than £500,000. The numbers don’t matter, but your number does. Your question is do you have enough? It is our experience that people want to understand if they…

08.02.2022

Can you believe investment performance graphs?

I happened to look at a journalistic website called money to the masses. It talked about how to invest £100,000. It also was nudging people to buy a portfolio they had designed. It was called the 80/20 Portfolio. The 80/20 had “outperformed. Take a look at the graph by following the link. If you were an investor, it clearly shows outperformance. Job done. Where do I sign! Hang on…. A closer look at the benchmarks, you would presume the comparison is based on similar risks. Logic would say, if 2 drivers had the same car but one was better than…

08.02.2022

There is a chance of a seismic change for wealth management.

“I was recommended to a large wealth management firm in London. They are well known and have beautiful offices in the City. We moved our entire portfolio to them in 2014. Late in 2019 we finally pulled everything out. They were expensive, slow to react, inaccurate at times. (we regularly noticed stupid mistakes in their paperwork) but worst of all, we realised there was a total lack of transparency in how we were being managed. We discovered they used third party platforms which were never declared to us and resulted in us being locked into funds. We only discovered this…

08.02.2022

“Investing should be more like watching paint dry”

“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.” – Paul Samuelson Paul Samuelson was an American economist, who was the first American to win the Nobel Memorial Prize in Economic Sciences. The point is whether you think investing is gambling. If you do, you’re doing it wrong. The work involved requires planning and patience. However, the gains you see over time are indeed exciting! In the meantime, it can be very boring today.

01.02.2022

Is your portfolio working for you or your Wealth Manager?

It may sound strange to ask the question, who is your portfolio working for? In an ideal world, the answer should be balanced. That doesn’t mean say 50/50. It means balanced with fairness. It depends on what both parties ‘bring to the table’. The investor brings all the money and takes all the risk. The wealth managers provide investment skills. So what is a fair balance? Imagine you own a property for rent. Its value is £500,000. The rental is £25,000. The rental company fees are 15%. That’s £3,750 pa. You may shop around to check if that’s fair. If…

01.02.2022

You don’t invest to lose money.

When you invest your money, you don’t intentionally do so knowing you will lose money. You may accept you could lose your money, but only some, not all. Your intention is to accept the possibility of some loss but with an eventual gain. Otherwise, why bother investing? Does losing mean losing your initial capital or does it mean losing your purchasing power?

01.02.2022

Do you want to be told what you want to hear about your money?

Whenever you ask anyone for help with your money, do you want to be told what you want to hear? If you think about the question, you’ll probably say NO, I’d rather be told the truth. But what if you are told something you don’t want to hear. You’ll feel upset, perhaps a little anxious, annoyed…whatever the emotional description, it’s broadly negative. Imagine you need some financial guidance and agree to talk to 2 wealth managers. One says what you want to hear, the other says the opposite? Who do you choose? What are your feelings telling you? Imagine you…

01.02.2022

Hold cash, think, then invest

If you have just retired, sold your business, won the lottery, inherited money, just divorced, the investment industry wants you to invest now. Why? It’s in their best interests. If you are approached by a salesperson from UBS, St James Place, Tilney, Brewin, Schroders…in the fact, the list of people selling investments is very long…but they know if they can secure your money, the chances of you changing your mind are low which means they get their fees over many years. It may turn out to be a great decision, but with so many choices, the odds are against you….

01.02.2022

The Science of Thinking Out Loud

On one hand, anyone who’s given a presentation or struggled through a math problem knows the benefits of vocally pumping themselves up in the bathroom mirror, or cursing their way through the equation. On the other, if anyone witnessed you muttering your way through your bills, alone at the kitchen table, they’d quickly assume you to be the kind of insane person who mumbles nonsense on the bus while holding grocery bags stuffed with other grocery bags. Why do we privately consider the former a necessary step in finding solutions, but associate public self-talk with having a mental disorder? According…

01.02.2022

Pension savers risk being bamboozled by choice

The headline, Australian pension savers risk being bamboozled by choice, says regulator, comes from the FT. In the article, this point was made “We are troubled by the proliferation of products in the choice area,” she said. “We have to question whether that is providing a good outcome for members.” Margaret Cole, an executive board member of the Australian Prudential Regulation Authority, said the body would be having “serious” conversations with trustees that were not improving so-called choice superannuation products for members and it was “troubled” by the number of options offered on the market. It’s not exclusively an Australian…

01.02.2022

Money managers and investment advisors will say fees are “only 1%.”

Charles Ellis wrote a book on investing called “Winning the losers game”. The great takeaway from the book is the tennis analogy. Charles explains that in amateur tennis, the one who wins is the one making the fewest mistakes. In other words, for most tennis players, the game is not hitting winners but making the least mistakes. In a recent article, he talks about how we got here regarding asset managers and how they charge. We can discuss it in a moment, but first, this is what Charley Ellis has to say.. “…why are fees based on assets? Years ago,…

31.01.2022

How many of your parents are in this situation?

“How many of them have been paying 1% to their friendly advisor for 30 years, never realizing how much it’s actually costing them? If they have an advisor, call them (your parents) today and ask how much they’re paying” This is a tweet from Ramit Sethi. He wrote the book “I Will Teach You To Be Rich“ The issue relates not to value, as it’s subjective, but understanding fees that are payable. As stupid as it sounds, many investors do not fully understand the charges they pay. Only when you understand can you then determine value. Ramit Sethi’s point is…

31.01.2022

4 Reasons Investors Should Worry About Market Volatility

Peter Lazaroff writes in his blog 4 Reasons Investors Should Worry About Market Volatility. He says, Volatility is normal, but you should be more concerned if any of these things apply to you. You went to cash. Even if you could accurately predict the future, knowing how the market will react is impossible. Going to cash requires you get it right twice — once when you sell stocks and once when you buy back in — making an already tall task insurmountable. Plus, the best days for the stock market historically follow the worst days. Missing out on those returns from…

31.01.2022

13 Decision Making Techniques and Tools for Business

In life, we make decisions every day. And in the context of running a business, decision-making gets even more serious in nature, as the resulting outcome would affect a whole organization, its performance, its direction or its employees. Following are visual decision-making techniques that you can use during different stages of decision-making. Each technique is provided with an editable template that you can click and customize online during your decision-making process. We talk about how to make good financial decisions all the time. I found this blog post that details different methods and metrics to help systemize various forms of…

13.01.2022

Client who has been paying an adviser over $20,000 per year in AUM fees for a $2M trust

“Another day, another client who has been paying an adviser over $20,000 per year in AUM fees for a $2M trust that holds 83 different mutual funds and ETFs. I use the term “adviser” begrudgingly here because there is no clue of advice in this account.” This is a tweet from Rick Ferri in the US. He explains that so many investors employ advisers, wealth managers, private bank investment services…charge based on the client assets they manage. In this example, an adviser is charging 1% for a trust fund valued at $2m. The portfolio has a large number of mutual…

15.12.2021

Why Writing Letters to Your Kids Is the Best Gift You Can Give Them as Adults

Jim O’Shaughnessy is a Wall Street legend and the founder, chairman, and chief investment officer of O’Shaughnessy Asset Management, which has $6.2 billion in assets under management. He says “I’ve always believed in the written word. Having to put your thoughts in writing helps you understand if you clearly understand what—and how—you want to say something. And if you keep written journals, there is simply no way to let hindsight bias take over, for there, in your own hand, is what you thought about something at the time, with revisions through selective memory impossible. Writing clarifies. It illuminates. It helps you…

07.12.2021

Why is a MOT a legal requirement?

Why do cars need MOT? The MOT test checks that your vehicle meets road safety and environmental standards. You must get an MOT for your vehicle by either: the third anniversary of its registration. the anniversary of its last MOT, if it’s over 3 years old. If you can identify a potential problem in advance, it could save lives. Without MOTs, you could drive a vehicle that could crash with disastrous results. We all know it makes sense to ensure vehicles are tested to be roadworthy. In the investment world, not having an investment MOT can be financially disastrous. Want…

07.12.2021

Two-thirds of children fire their parents’ financial adviser after they receive an inheritance

“Research by US publication Investment News suggests around two-thirds of children fire their parents’ financial adviser after they receive an inheritance” If 2/3rds will sack their parent’s advisers, why aren’t the parents sacking their advisers now, especially if their children are prepared to do so? Does it mean the children are making mistakes? Perhaps it’s the parents who need to look at how they invest to understand why their children would sack their advisers? It’s time for a conversation.

07.12.2021

Get Comfortable with Being Uncomfortable

Have you ever heard of David Goggins? Goggins is the only member of the US Armed Forces to complete SEAL training, US Army Ranger School, and Air Force Tactical Air Controller training. Any of those accomplishments alone would have been impressive, but that’s not all. He’s also the current Guinness record holder for the most number of pull-ups done in 24 hours. Alongside that record are multiple first-place finishes at the most brutal ultra-endurance events, which attracts the toughest competitors from around the world. In this video, he talks about “Get Comfortable with Being Uncomfortable” He is a motivational speaker,…

07.12.2021

Higher yielding assets tend to increase drawdown risk

In a world where yields from investments are low, there is a challenge to retirees to capture investments that generate higher levels of yield to meet their goals for expenditure. In a webinar with Vanguard, they highlighted the problem of investing in higher-yielding assets. In the event of market fluctuations, investing in these types of assets increases the downside risk. Of course, this is not an issue if you understand the extra risk you are taking..but it can be a surprise if you didn’t know. Do you understand the risks you are taking when you seek yield?

07.12.2021

How NFTs Are Set to Disrupt the Music Industry

NFTs (or Non-Fungible Tokens) are ushering in the next era of internet creative commerce and they offer the potential to shift the current trajectory of today’s music industry. But for so many artists, it’s just another complicated digital space to worry about. So, what are NFT? NFTs are digital assets that have objective ownership through blockchain technology. They can come in the form of digital art, videos, sports cards, collectibles, and yes, music, that are exclusive to the owners and unable to be deleted or duplicated (this is what non-fungible means). NFTs were originally only able to be purchased or…

07.12.2021

Avoiding Stupidity is Easier than Seeking Brilliance

“We often focus on trying to be brilliant, yet many great people get far more mileage out of avoiding making stupid mistakes. Amateurs win the game when their opponent loses points, experts win the game by gaining points. Scientist and statistician Simon Ramo wrote a fascinating little book that few people have ever bothered to read: Extraordinary Tennis Ordinary Players. The book isn’t fascinating because Ramo identifies the crucial difference between the Winner’s Game and a Loser’s Game. Ramo believed that tennis could be subdivided into two games: the professionals and the rest of us. The game looks the same…

07.12.2021

How do you cut your golf handicap or improve your tennis?

The answer is you hire a coach. Yes, it’s obvious…but any coach? So you want to cut your golf handicap. You hire a coach and you talk through ideas and then the coach suggests, it’s not you, it’s your clubs. If you had a better set of golf clubs, your game will change. The golf coach says, “…and I have the perfect set for you” So you buy the new set in the belief your handicap will fall. You go for a tennis lesson. You know the story. It’s your racquet. The coach says “…and by the way, I have…

05.11.2021

Roughly ⅔ of today’s students will end up doing work that hasn’t been invented yet.

This was a tweet by Ana Lorena Fabrega @anafabrega11 . “Roughly ⅔ of today’s students will end up doing work that hasn’t been invented yet *what* we teach kids is less important than *how* they learn to teach themselves”. Whilst it’s directed at students, it’s important to recognise we are still students at any age. As adults, we are still students. We apply Ana’s thinking to money and *how* you make better decisions with your money for your future. Learning *how* to look after your money is so important. When you have a set of tools you can make better…

05.11.2021

The sticking plaster analogy.

You go to the doctor for help. You explain your situation and you end up with a sticking plaster. The doctor says, “By the way, this is a great sticking plaster”. You go back again and they say, actually, we found a better-sticking plaster. And then the process continues again and again. Are you solving the problem? You just seem to have a whole bunch of sticking plasters! In the world of investment, portfolios are continually churned. You are told this fund or this stock is not as good, so let’s replace it with another better one. After a while,…

05.11.2021

What is ‘investor inertia’ and how it can waste your wealth

Investor inertia or the condition where investors are comfortable doing nothing is a well-documented phenomenon. Investors worry about making the wrong decision or just being too comfortable with the status quo. Faced with too many choices, they do not know what to do. They dislike tasks that entail making multiple decisions. Paperwork is something they hesitate to take on as it involves time, too many details, and the need to deal with multiple agencies. Denial is preferred instead. This behaviour has caused many people to struggle in their retirement years, despite high incomes and successful careers explain Wealth Management One…

05.11.2021

What is special about the number 25.8069758?

If the number 666 is considered evil, is 25.8069758 the root of all evil? Of course, it’s fun. Especially when money is said to be the root of all evil…

05.11.2021

8 out of 10 St. James’s Place funds have consistently underperformed

Yodelar’s St James Place review of 2021 says: Poor Performance and high costs from St James’s Place 8 out of 10 SJP funds have consistently underperformed. Over 50% of SJP funds rank in the worst 25% of their sector 72% of St James’s Place funds perform worse than the benchmark St James’s Place admits two thirds of funds failing consumers. Restricted advice model, clients limited by fund choice SJP advisers are unable to advise investors on 99.3% of the investment market. Exit penalties of up to 6% for the pension and bond products Limited protection under the Government FSCS Scheme….

05.11.2021

Is your investment portfolio bespoke to you?

You go to a Wealth Manager or Stockbroker or Fund Manager and request a bespoke portfolio. To you that means, building an investment portfolio unique to you. Now imagine 10 different individuals, requesting the same desire for a bespoke portfolio. In this instance, each has been assessed risk and allocated a 50/50 portfolio. It is then up to the fund manager to choose the underlying investments. If each portfolio is unique, is it likely each portfolio return will be different? The answer is Yes. Why? The underlying investments are different. But out of the 10 people, is it fair you…

05.11.2021

How to Find Actively Managed Funds That Outperform

The title is from an interview between Susan Dziubinski and Ben Johnson of Morningstar. “The other all-important sort, too, that is important to understand is the fee sort. What we see is that almost uniformly less costly funds have higher chances of surviving and outperforming their indexed peers. The arithmetic of active management, as Bill Sharpe has described it, is absolutely ruthless, and it shines through in this data. So, if investors want to improve their odds of partnering with winning active managers, it’s important that they pick their spots and keep a close eye on their costs.” Think about…

02.11.2021

The zero-sum game theory

The zero-sum game theory states that, at any given time, the market consists of the cumulative holdings of all investors, and that the aggregate market return is equal to the asset-weighted return of all market participants. For each position that outperforms the market, there must be a position that underperforms by the same amount, such that, in aggregate, the excess return of all invested assets equals zero. The theory describes a theoretical cost-free market. In reality, however, investors are subject to costs to participate in the market. When costs are factored in, including management fees, bid-ask spreads, trading commissions and…

01.11.2021

Do you have a trust?

Why? If you ask a lawyer or accountant to help you with a trust, they may suggest being trustees and providing annual accounts and tax returns. That’s good for them. If you employ a wealth manager, they want to manage the trust funds. That’s good for them. There have been many occasions when we meet families who have set up trust funds and we ask, why? The answers are often ‘It sounded a good idea at the time’ We are not anti-trusts, on the contrary, we want clients to make the best decisions that are right for the long term…

01.11.2021

Investors; yes dear reader…that’s you – are supporting an investment model that is broken? It is time for a change.

Former AllianceBernstein chief on why fund management model is broken. Peter Kraus, once a highly paid Wall Street executive, says performance not scale must be industry’s focus. Siobhan Riding writes in the FT, about Peter Kraus. The 67-year-old, who made his name on Wall Street when he served as co-head of Goldman Sachs’ asset management business, centred the business around his belief that active management in its current form is broken and needs to be reinvented. The article in the FT has some interesting points. “The revenue model in asset management is built for scale, not for performance,” says Mr…

21.10.2021

Discretionary trusts and the increased dividend tax rate

The Government’s package of measures to help fund social care reform may have a knock on effect for trustees. With the rate of tax on dividend income set to increase by 1.25%, it means trustees may have important decisions to make on how they deal with trust income and how they invest trust capital. The additional tax was introduced in conjunction with an equivalent rise to National Insurance so that everyone, regardless of their employment status, was subject to the levy. But the dividend tax rise applies across the board and not just to business owners who pay themselves in…

21.10.2021

What’s your risk capacity?

When you first meet with a financial advisor, they will ask you some questions about your risk tolerance. They will want to understand how comfortable you would be with market volatility and how you might react to seeing your investments drop in value. They will want to know if you are someone who embraces investment risk because it opens the door to more opportunity, or if you’re more risk averse – and likely to lose sleep when the market loses ground. Risk tolerance relates to your willingness to take on risk to achieve your goals. It’s based on your beliefs,…

20.10.2021

The mega crash is coming…..

A HUGE mega-market crash is fast approaching and people need to act now to avoid inevitable economic disaster, says Robert Kiyosaki, the best-selling author of Rich Dad Poor Dad, forecast a “giant” market crash is set to happen this October. It is October as I write this…the crash has not happened. (yet!) You don’t really need to concern yourself about market predictions. Most of the time they are wrong. However, at some point in time, a crash will hit everyone. Warren Buffett talks about ‘don’t lose money’. He is right, but how do you not lose money? To not lose…

15.10.2021

You need 3 good financial decisions a year.

To make good decisions, Jeff Bezos emulates fellow billionaire Warren Buffet’s decision-making philosophy: “Warren Buffet says he’s good if he makes three good decisions a year, and I really believe that,” Bezos said. Just think about this point. Warren Buffet is happy if he makes three good decisions each year. As an investor how do you make three good decisions each year? If you use wealth managers, how can you make sure your managers make three good decisions each year? Think about how much time and effort it takes to make three good decisions? How easy could it be to…

15.10.2021

Do you care what you eat?

We all recognise that the food we eat will impact our long-term health. The evidence is clear, eating processed food, like Burgers all the time is clearly unhealthy. You don’t eat a burger every day because you can see it, touch it, smell it, and taste it. Your senses tell you it’s not a good idea to eat the burger today. Your senses remind you why it’s important not to eat burgers all the time. Yet when it comes to your money that you’ve accumulated for your future, and your family’s future, your senses are not strong enough to tell…

15.10.2021

Is this investment strategy fantastic?

Claer Barrett from the FT talked about the latest Retirement Survey from Interactive Investor. If you are interested, here is the link. This is a reader’s view of how to invest. “Create a Family Investment Company ( just a regular LTD co ). Fund it with a £500k shareholder loan at 0% interest from you. Open an account at interactive brokers for the company. Have it invest in ETFs. Use the dividends to pay back the shareholder loans. Split the FIC share classes into Growth and Freezer shares. Give the growth shares to your kids for tax inheritance planning. That’s…

13.10.2021

Do Not Hide Unwanted Things In The Fog

Things get lost in the fog. The title is from Jordan Peterson. Rule 3: Do Not Hide Unwanted Things in the Fog Beyond Order: 12 More Rules for Life Hiding things under fog leads to an impasse because if the problem is hidden from sight, one cannot solve it. On the other hand, if the problem is revealed, then something can be done about it. It may make people uncomfortable to talk about the problem, and there may be a lot of passing of blame and responsibilities of that problem. At times it would feel unjust, but nevertheless, it is necessary…

13.10.2021

Can you identify fake investments?

This is a video from The Economist. It discusses Fake information and Deepfakes. It is going to be harder to know what is or is not real. It makes the job of trusting harder. If you trust others less, you need to trust yourself more. To make better decisions, you need to think through issues when perhaps in the past you left those decisions to someone else. Think about your money. Should you be making more of your own decisions or delegating to others? Whilst Adam Smiths’ division of labour makes sense; it only makes sense if trust is involved…

13.10.2021

Mastery comes from immersion

“I spent most of my childhood struggling to learn Spanish at school. Then I went to Spain, spoke nothing but Spanish for 30 days, and came back almost fluent. For almost any subject, the classroom will get you started but mastery comes from immersion.” says David Perell on Twitter. It is OK to delegate all your investment decisions to others. It has risks that you must address, but unless you manage the risks correctly, you’ll never achieve great outcomes. To get better outcomes, you’ll need to be more hands-on. In other words, “Mastery comes from immersion”. It’s vital to start…

13.10.2021

Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.

It’s a quote from Keynes. Keynes thought that professional money managers were playing an intricate guessing game. He likened it to a common newspaper game, “. . . in which the competitors have to pick out the six prettiest faces from 100 photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors as a whole: so that each competitor has to pick, not those faces that he himself finds prettiest, but those that he thinks likeliest to catch the fancy of the other competitors, all of whom are looking at…

13.10.2021

All businesses eventually die.

A wonderful nugget of investing wisdom from Buffett and Munger’s recent CNBC interview: “All businesses eventually die. The essence of investing is to buy businesses that give us back so much in dividends before they die that we get our purchase price back, plus a decent return.” To see the interview via Twitter, here is the link https://t.co/HOspQiESH9 It’s a simple yet profound point. You allocate your capital to a business on the basis you get your money back before it dies.

13.10.2021

“I left Coutts”

It’s a statement made by a client. The question is why? There was no need for borrowing. Instead, Coutts managed assets under a wealth management service using their own propriety investments. There were also conflicts of interest. Whilst Coutts did work for the client in earlier years, it was clear they were now paying for services they did not need. Inevitably the cost of a relationship became very expensive. To challenge your own decisions, you need to be open-minded, curious, and courageous. If you are not, it’s easier to stay doing what you’ve always been doing. If you are open-minded,…

13.10.2021

Ivy endowments should have the investment answers, shouldn’t they?

For the second consecutive year, all Ivy endowments (save for Brown) and the Ivy average, underperformed a 60-40 portfolio of US domestic stocks and bonds. Even though Ivy Leagues use Private Equity to help boost returns, it is still hard for these asset managers to consistently achieve above-average results. What is the message? As a private investor, to outperform consistently is a big ask. Yes, you may have some funds that outperform sometimes, but for your total investable assets, your pensions, ISAs, and General Investment accounts…for your total assets to outperform, it is unlikely. This means you need to ask…

13.10.2021

Succession planning

“Deciding how and when to pass wealth on to future generations can be difficult to navigate. Understanding your options and how this can be managed is key to ensuring assets are passed to children, grandchildren and others in line with your wishes.” Credit Suisse Wealth Planning UK The largest intergenerational transfer of wealth is taking place among the world’s wealthiest families. Between now and 2029, USD 8.6 trillion of global high net-worth wealth will be transferred from one generation to another.1 Yet while every family inevitably faces succession, research shows that not all are prepared for a smooth hand-off: 70%…

13.10.2021

Some interesting but also scary predictions. How many will come true in the next 5 to 10 years?

It doesn’t matter whether you agree or disagree with these predictions, they are not mine, and some are not new to you, but how you allocate your capital for the future will change. What thinking do you need to do today to establish what action you need to take? 1. Auto repair shops will disappear. 2. A petrol/diesel engine has 20,000 individual parts. An electrical motor has 20. Electric cars are sold with lifetime guarantees and are only repaired by dealers. It takes only 10 minutes to remove and replace an electric motor. 3. Faulty electric motors are not…

24.09.2021

Which is the best DIY investor platform?

You can choose between many platforms. AJBell, Hargreaves Lansdown, Interactive Investor, Fidelity, Barclays, the list is a big list. To focus on which is best for you, it makes sense to compare the different platforms based on how you intend to use their services. But, is there one best platform? We don’t think so. In other words, if you get it wrong to start with, you can change your mind. So if the platform is not vital in your decision-making, what is? When you use a platform, you need a process to make the right investment decisions. If you are…

12.08.2021

Do I transfer my pension to my company pension scheme?

This is a question we are often asked. Many people like the idea of amalgamating pension plans. It gives the impression of simplicity. In general, we agree, but it is not always the right thing to do. If you have a defined benefit scheme, clearly, it requires specialist advice before taking action, however defined contribution schemes can often be amalgamated. You need to be aware of costs of transfer as well as the ongoing costs. Clearly investment performance is always an issue. Importantly also is risk measurement and asset allocation. Generally, company pension schemes provides default options. And as individual…

27.07.2021

We must face facts — even the ones we don’t like

Tom Cruise wanted to do a stunt. The Safety officer for the film said ‘NO’. What did Tom do? Get another Safety guy who would say ‘YES’ If you have choice and power over your choice, like Tom, you can change the outcomes if you don’t like the facts. The title “We must face facts — even the ones we don’t like” comes from an article by Tim Harford in the FT. In the world of wealth management, are the salespeople more likely to tell you something you want to hear or not? Do they follow the old adage ‘the…

09.07.2021

What is ESG?

What is the definition of ESG? ESG means using Environmental, Social and Governance factors to evaluate companies and countries on how far advanced they are with sustainability. Once enough data has been acquired on these three metrics, they can be integrated into the investment process when deciding what equities or bonds to buy. If asked, most investors like the idea of ESG. However, fund managers know this, as such, they want to promote ESG to help sell funds. If ESG is important to you, you’ll need to carry due diligence. You may have heard of the term ‘green washing’

08.07.2021

Do your wealth managers suffer from GroupThink?

Groupthink is a psychological phenomenon in which people strive for consensus within a group. In many cases, people will set aside their own personal beliefs or adopt the opinion of the rest of the group. The term was first used in 1972 by social psychologist Irving L. Janis. As an example, the Challenger Space Shuttle disaster. Engineers of the space shuttle knew about some faulty parts months before takeoff, but they did not want negative press so they pushed ahead with the launch anyway. Do your wealth managers understand compounding costs but choose to ignore them? Are they suffering from GroupThink?…

29.06.2021

Is your pension fund over £1m?

You will be aware of Government legislation surrounding the Lifetime Allowance. Whilst tax may be inevitable, the question is how can you increase your investment returns. Many pension funds are managed with a combination of Bonds and Equities. There is much debate at present whether the 60/40 investment portfolio is dead. If this is the case, your expected returns will be impacted. It means therefore the tax on your pension fund has also more of an impact. In many situations, large pension funds do need a rethink in terms of asset allocation. Whilst some financial institutions question the risks of…

29.06.2021

Is it more fun to play sport or watch it?

I do love watching some sport, especially sportspeople at the top. Federer. Messi. Ronaldo. Bolt. McIlroy. Hamilton. For me, it’s much more fun to play. I’ll never be a professional athlete, but I’d rather be a participant than a spectator. In fact, according to a study, learning by doing is better for retention than learning by watching. When you invest, most people watch. The investment industry encourages people to ‘watch’ the professionals. Watching means you are not as engaged in the process which can be time-saving. In the division of labour theory, you delegate to someone else who is a…

29.06.2021

‘Deep sickness’ in UK capital markets

A “deep sickness” in UK capital markets has stifled the growth of homegrown tech entrepreneurs and left London’s blue-chip FTSE 100 looking like an index from the 19th century, according to one of Britain’s top fund managers. (says Baillie Gifford’s James Anderson in the FT) He adds…“Bad managers have a much easier time, because if they just obey what the combination of their bonus system and ESG tells them, they can survive . . . and get paid extremely well. It’s become more difficult for companies to really think about the task of building their competitive moats.” If you allocate your money to fund…

29.06.2021

The 7 Conversations Every Family Should Have Around Wealth

According to Pitcairn in the US…Family leaders work hard to create and sustain wealth that will extend to future generations and create a lasting family legacy. Yet when it comes to actually talking about wealth and communicating what it means for the family, many avoid critical conversations and delay discussions. It’s the elephant in the room. Everyone is aware of the importance, but few want to openly discuss it. According to researchers at North Carolina State University, parents are more likely to discuss saving, spending, and earning with children, but family finances, parental income, investments, and debt are off-limits. Avoiding…

28.06.2021

As a DIY investor, what happens when you die?

We believe investors should be making more of their own decisions. In our experience investors with good strategies, can achieve great outcomes. However, often in any relationship, one partner tends to take more of an interest than the other. If this applies to you, think about what plans your partner or spouse will make if you die. If they are not as confident in making their own investment decisions, that could mean all the good work you have done could easily be undone with poor decisions. In an ideal situation, both partners are equally competent in decision-making. That means in…

28.06.2021

Why taking action on your investments today will change your life today

Let’s say your investments are valued at £1m. You delegate your investment decisions to wealth managers. The average costs are 2.5% per annum. If your gross investment return was 6% per annum, in 25 years you now have £2,395,822 If your costs were only 0.5% per annum, you get the same outcomes by investing £600,000 not £1m. In other words, by taking action today, you are richer by £400,000. Of course, this is maths, but it is more about perspective. Rather than thinking it doesn’t matter how you invest your money today, clearly, it does matter. What could you do…

28.06.2021

Should you use private equity managers?

The FT article Australia’s pension titans set to storm private capital markets discusses how “Super-sized Australian pension funds that collectively control more than $2tn are expanding their in-house investment teams to join up with or even bypass private equity firms to place big bets on companies directly.” It is a question about what you can do for yourself and what you need to delegate to others. Why would these pension funds cut out middlemen? “But with high fees dragging on returns, some big institutional investors have started to invest in companies alongside private equity firms — or even cutting them…

28.06.2021

Putting it on paper fixes it. If it stays in your head, the perfect idea or thought, you’ll never share it.

There is always so much going on in day-to-day life. You are only making decisions in the present. It’s hard to give a thought to your future, and when you do, they stay thoughts. It’s only when you write them down do you have the opportunity to share your ideas to help you make better financial decisions. When you invest, you need a process that’s written down. Otherwise, it stays in your head and will change whenever you think about it again. Your question is whether it’s worth writing it down? How much of a payoff will you get if…

25.06.2021

“I guarantee, your investments feel OK”

“I guarantee, your investments feel OK” I was playing tennis today with my coach. I wasn’t picking up the racquet head enough to allow topspin to flow. My coach said I was too tense. I stopped to reflect, and I said that I didn’t feel tense. Moments earlier my forehand was relaxed and effortless and I then realised that I was holding too much tension. If my coach had not pointed out the tension in the backhand, I would have not fully appreciated why my success rate had dropped even when I felt OK. As far as I was concerned,…

21.06.2021

How do you define investment success?

If you employ a wealth manager or financial adviser, what results are you buying? Have you ever defined what you are actually paying them to do for you? If you want them to be successful, what does that actually mean? How do you measure success? If it’s about results, how do you define ‘results’? If you can’t really answer these questions, do you think you have problem?

21.06.2021

“What happened when I ate ultra-processed food for a month?”

TV presenter Dr Chris van Tulleken challenged himself to eat a diet made up of mostly ultra-processed foods for a month. “After the month was over, Chris reported poor sleep, heartburn, unhappy feelings, anxiety, sluggishness, and low libido. He also had piles from constipation. “I felt ten years older”, he says, but “didn’t realise it was all [because of] the food until I stopped eating the diet”. Whilst we all know that eating processed food is not good for us, we still do it. The consideration is how much we eat. Too much, in this case, the impact is noticeable. If…

27.05.2021

Daniel Kahneman: ‘Everything I’ve done has been collaborative’

The headline is an FT interview by Tim Harford with Daniel Kahneman. You can read it here. The main point of this blog is the title.‘Everything I’ve done has been collaborative’ When making financial decisions, it’s really hard to make them in a vacuum. Talking through ideas helps bring clarity. Collaboration is therefore really helpful. Nevertheless, discussing financial decisions needs impartiality. Sadly, many wealth managers cannot give impartiality, even when they call themselves IFAs. In our world, we recognise the importance of not linking conversations with products. By having open discussions, you can ensure you make better financial decisions. Want…

27.05.2021

Are you a Fox and Grapes investor?

Are you a Fox and Grapes investor Yes, it’s Aesop. Here’s a story. Simon wanted to improve the investment return on his investments. That’s perfectly natural. I don’t know any investor who purposely doesn’t care about the return. Everyone does. Over time, Simon’s investments didn’t meet expectations. In fact, by any fair analysis, Simon underperformed. That is more common than you may think. Simon ended up being sanguine with the result. Simon accepted the return, after all, what else could he do? His desire to invest was driven by greed, I don’t mean Gordon Gekko greed, but the desire for…

27.05.2021

Sergio Aguero’s missed penalty

The BBC reported Sergio Aguero’s missed penalty against Chelsea on 8th May. This was supposed to be a fitting finale, Aguero scoring the goal that seals Manchester City their fifth Premier League crown, just like he did for their first. However, he missed. He chipped the ball into the air and watched Chelsea goalkeeper Edouard Mendy catch it one-handed, allowed Chelsea a route back into the game. Aguero apologised by saying “I would like to apologise to my teammates, staff and supporters for missing the penalty. It was a bad decision and I take full responsibility.” Yes, he missed, but…

25.05.2021

Does your portfolio look like the gurus?

A recent article in the FT by Sir John Redwood details what he thinks your portfolio should look like. The FT Fund is a dummy portfolio intended to demonstrate how investors can use a wide range of ETFs to gain exposure to global stock markets while keeping down the costs of investing. But… If you are an investor with Charles Stanley, where Sir John Redwood is chief global strategist, and your portfolio looks nothing like what he suggests, would you not be concerned? If the chief global strategist thinks this is what a portfolio should look like, should your portfolio…

25.05.2021

Which Ghost Has The Greatest Impact On Scrooge?

There is no right or wrong answer. I recall talking about estate planning with a client and they said if only they knew when they would die, it would be so much easier. In other words, uncertainty about the future becomes more certain if you can see the future. As Scrooge was able to see a version of the future, he was able to change decisions today. If you understood more about the consequences of your actions if you could see your future, it may alter the decisions made today. Clearly, we can’t see the future, but we can think…

25.05.2021

“In investing, what is comfortable is rarely profitable.” – Robert Arnott

At times, you will have to step out of your comfort zone to realize significant gains. Know the boundaries of your comfort zone and practice stepping out of it in small doses. As much as you need to know the market, you need to know yourself too. Can you handle staying in when everyone else is jumping ship? Or getting out during the biggest rally of the century? There’s no room for pride in this kind of self-analysis. The best investment strategy can turn into the worst if you don’t have the stomach to see it through.

21.05.2021

The traditional 60/40 portfolio is at risk of becoming obsolete

Investors don’t feel anything yet; it’s like the hole in the bucket that’s full of water. At first, there seems to be plenty of water in the bucket and you can see the water is still near the top. However, if you do nothing, you look down and see there is very little water left. That’s when you panic and action is taken. But that’s really too late. Action should have been taken when the water was full. Checking for holes when there is no sign of holes! A “nuclear winter” beckons for the 60/40 portfolio in the 2020s, said…

21.05.2021

How should wealthy parents treat wayward offspring?

“The best time to learn to have conversations about money with your children is when they are small,” he says. “The second-best time is now. You’ve just got to have these conversations — and they will be tough.” says Carl Richards in the FT The FT says “Some financial responsibility can be encouraged in young children. May, at Coutts, suggests encouraging them to divide their pocket money into three pots: one for spending, the second to save for a bigger item and the third for charity, which can help parents and children talk about values. Janet Hibbs, a family therapist…

21.05.2021

Investing is hard work as you get no immediate benefits.

You realise that getting physically fit is good for you and decide to visit a gym. At the gym you run, cycle, and row; lift weights, join a class. You get home, look in the mirror. And…nothing. Your body looks exactly the same as it did yesterday. All that effort for nothing. In fact, all that effort and you feel worse than yesterday. The next day is the same and the day after. No change. All this effort, for nothing. When your future self looks in the mirror, they will say you look great. The reason why you look great…

19.05.2021

Do fund managers think of themselves as alchemists?

If we knew how to convert lead into gold, we would all do it ourselves…. but the genie is out of the bottle and we do know…you just need to believe it! Of course, fund managers want to sell themselves as alchemists. To use their skills to consistently outperform. To change from something that is average to something that is above average. Day in day out. Week in week out. Year in year out. And the stories sold to investors portray alchemy. Sadly you are more likely to get Pyrite, or more commonly known ‘fools gold’. Investors are likely to…

19.05.2021

What’s your own definition of “enough”?

“Many of us are operating with an incredibly vague notion of how much we really need to save in order to achieve our financial goals and find security. And even financial planners might rely on rules of thumb when setting your retirement savings target–for example, they might assume that you’ll need 80% of your working income in retirement and extrapolate the rest of your plan from there. As humans, we often have a natural tendency to reach for more more more, regardless of whether that “more” is actually bringing more happiness and security. Trying to keep up with the people…

19.05.2021

Do you use a private bank because you want to feel important?

Dale Carnegie talks about the ‘feeling of importance. “The desire for a feeling of importance is one of the chief distinguishing differences between mankind and the animals. This desire makes you want to wear the latest styles, drive the latest cars, and talk about your brilliant children”. Private banks are good at making you feel important. But what are they selling and what do you need to buy? Private banks want to sell the highest margin products possible. Of course, that’s not the narrative, but when you think about it a little more deeply, you’ll appreciate that is their goal….

19.05.2021

Generation corona has been handed a life sentence

“Even before this crisis, younger generations had a bad lot. Unlike previous generations, today’s graduates leave university saddled with debt and with marginal tax rates of up to 51%. The pension they receive will be smaller, but they will have to work for longer and contribute more to receive it. The things that previous generations took for granted — a home, a secure job, the ability to settle down and start a family — are harder won and later found, if at all.” It’s an opinion article. You can read it here. How do investors allocate their capital into businesses…

19.05.2021

What is RISK and how you can manage it

In investing, risk comes primarily from these four aspects – Inability to sell your investment – Liquidity Risk Possibility of capital loss – Market Risk and Quality Risk Possibility of returns lower than annual inflation – Inflation Risk Focus on a few securities only – Concentration Risk Specific portfolios can have additional risks, in general, if you are an active investor, these are some standard risks that all portfolios face. Your job is to manage risk. If you don’t want to or not able to, then you need to manage your managers. If you don’t manage your managers, then they…

19.05.2021

Boys cry and so do rugby players

Loosehead prop Joe Marler talks about confronting his mental health on BBC Saturday live. Humprey is Joe’s psychiatrist. A name that amused Joe! In this podcast, Joe talks about mental health. It is refreshing as Joe explains how hard it is to talk about ‘stuff’. As Joe says, to be allowed to feel vulnerable. It’s recognising when you need help and can find the right help. What has mental health got to do with money? You can only really solve a problem when you recognise you have one. So many people know that managing their money for the future isn’t…

13.05.2021

Do you think you can identify a scam?

Nic Cicutti, blasts vertically integrated firms as a scam. Is he being fair? Over the top? And does it impact on you? If you invest with a vertically integrated firm, yes it impacts you. In simple terms its firms like Brewin Dolphin, Quilter Private Client Advisers and Rathbones..and of course, St James Place. We need to address the ‘scam’ and explain ‘vertical integrated’ Vertical integrated is defined in a recent Money Marketing article as “taking ownership of the distribution chain by running your own platform, advice firm, funds and discretionary models”. The advantage is efficiencies of scale for the firms…

13.05.2021

10 Things You Shouldn’t Care About as an Investor

#1. How rich other people are getting. John Pierpont Morgan is attributed with the quote, “Nothing so undermines your financial judgement as the sight of your neighbor getting rich.”And JP didn’t have to deal with friends, influencers and celebrities constantly bragging about their lifestyle and wealth on social media all day long. There will always be people with more success, prestige, money and accolades than you. Easier said than done but not worrying about how much money other people are making can save you a lot of unnecessary stress and angst. If you want to get 2 to 10, link…

12.05.2021

Have you heard of HMRC Connect?

Connect is sophisticated computer software and is the key data analysing tool used by HMRC. It was introduced in 2010 and was developed with the help of BAE Systems. It is said to have cost £100m, but has recovered more than £3bn in taxes since its launch. Information held in the system currently includes: UK and overseas bank account information Debit & Credit transaction information for the last 4 years Land Registry property ownership information UK Border Agency details of entry into and departure from the UK and the intended destinations Companies House information HMRC data – SA, VAT and…

11.05.2021

Steve Jobs on problem solving…

“When you start looking at a problem and it seems really simple, you don’t really understand the complexity of the problem. Then you get into the problem, and you see that it’s really complicated, and you come up with all these convoluted solutions. That’s sort of the middle, and that’s where most people stop… But the really great person will keep on going and find the key, the underlying principle of the problem — and come up with an elegant, really beautiful solution that works.” Do you have an investment problem? The likely answer is no because you think you’ve…

11.05.2021

Are IHT schemes worthwhile?

I received a direct marketing email from a company called Puma. They offer an AIM IHT service. Generally, we do not use these types of schemes unless there are specific circumstances, which are unusual. However, we do see investors with these types of schemes which have been recommended by other advisers. There are many ‘sales’ angles to encourage investors to invest. But what don’t they tell you? I have 2 simple points, not aimed at Puma, but at all AIM IHT schemes. It is generally agreed that AIM investments are risky. Yet for risky investments, the actual returns often are…

07.05.2021

Top 30 Wealth Managers under the age of 30 reveal their favourite funds

Wealth Magazine asked Top 30 Under 30 to name their three favourite funds. This is an industry magazine. Out of all the picks, there was no consensus. Let’s add some perspective. Investors are employing fund managers, of all ages (well, not children), to pick funds for their investors. The purpose of their job is to pick funds that will outperform. They are not picking funds because they like the name, or they went to school with them; or even if they have a track record. They are picking funds to outperform. Yet all of these up and coming young professional…

07.05.2021

Are bonds really that stupid?

This is from the Editor of Wealth Manager Magazine. “There is a big question mark over modern portfolio theory, with the protection offered by bonds showing signs of cracking after the 40-year bull market. Earlier this year, Bridgewater Associates founder Ray Dalio didn’t hold back when he said the economics behind the asset class had become ‘stupid’ as the threat of inflation and yields at ultra-low levels caused severe dislocation. However, this £130tn market cannot simply be replaced for asset allocators who have traditionally used its defensive characteristics to balance portfolio risk. With fixed income caught in a crossroad, this…

29.04.2021

Is $12 billion Inheritance tax bill fair? How do you feel about inheritance tax?

Lee Kun-hee, who transformed South Korea’s Samsung into one of the world’s biggest technology groups, died last year. The family now has to find $12bn as payment for inheritance tax. The bill, which stems from South Korea’s 60 percent inheritance tax, the highest in the OECD, exposes the rapidly widening fissure between the country’s ultra-rich and ordinary citizens. Whilst $12bn is a big bill, the debate is whether it is fair or not? When the FT reported this issue, many readers posted comments. Why? Inheritance tax is very emotive. Some believe it is essential to ensure we have a system…

27.04.2021

Is the bubble about to burst?

Jeremy Grantham writes an article WAITING FOR THE LAST DANCE The Hazards of Asset Allocation in a Late-stage Major Bubble. “The long, long bull market since 2009 has finally matured into a fully-fledged epic bubble. Featuring extreme overvaluation, explosive price increases, frenzied issuance, and hysterically speculative investor behavior, I believe this event will be recorded as one of the great bubbles of financial history, right along with the South Sea bubble, 1929, and 2000. These great bubbles are where fortunes are made and lost – and where investors truly prove their mettle. For positioning a portfolio to avoid the worst…

23.04.2021

What do you want your legacy to be?

“When taking a strictly financial- and estate-planning perspective, leaving a “legacy” is one of those topics that can seem overly narrow. It’s about leaving assets behind for children, grandchildren, and other loved ones, as well as charity if we so choose. It’s about making sure we don’t burden the people we care about. Those are crucial considerations, and they’re why everyone needs an estate plan that includes wills, powers of attorney, and beneficiary designations, among other key documents. But while you’re at it, why not think big-picture about your legacy, too? What do you hope people will say about you…

22.04.2021

It’s not your fault, well perhaps it is, focusing too much on the short term.

Seth Godin writes about short term focus. He says “Why is there so much short-term hustle? Because that’s what we buy. Why is there so much negative campaigning? Because that’s what changes our actions. Why is social media filled with manipulation and vanity? Because that’s what we click on. We buy foods that are engineered to make us fat and we watch shows that are designed to numb us instead of inspire.” There is so much literature that discusses the present and future. Godin is saying it’s hard to think about the long-term future as there is no reward today. …

22.04.2021

Whats the difference between £27,800 and £30,353?

What’s the difference between £27,800 and £30,353? One is the total costs for looking after £1,000,000 the other is the UK average salary for the year. The average registered nurse is £24,797 Whilst for any analytical purposes these are incomparable numbers, yet they are important for perspective. If you employ wealth or fund managers that make you 20% each year, paying £27,800 to make £200,000 each year is a price worth paying. But when is the price not worth paying? If you have a 60/40 portfolio in favour of equities with an average return of say 8%, that’s £80,000 on…

22.04.2021

You learn something by doing it yourself, by asking questions, by thinking, and by experimenting

Richard Feynman said, “You learn something by doing it yourself, by asking questions, by thinking, and by experimenting.” Richard Feynman is Nobel prize-winning physicist who ensured he understood anything he studied better than anyone else. He had a technique. There are four steps to the Feynman Learning Technique: 1 Choose a concept you want to learn about 2 Pretend you are teaching it to a student in grade 6 3 Identify gaps in your explanation; Go back to the source material, to better understand it. 4 Review and simplify (optional) If you chose to delegate your investment decisions to wealth…

22.04.2021

How do you stop your children falling out over money?

“Stanley Ho, the legendary Macau gambling tycoon, has passed away at the age of 98. In 2011, a public battle erupted between the families of Ho’s second and third wives who teamed up against his fourth wife, Angela Leong, over Ho’s empire including a 32 per cent stake in his Hong Kong-listed gaming vehicle, SJM Holdings. The family battle was joined when one of his daughters, Daisy, was blocked by the SJM management from serving on the company’s board. Daisy is the daughter of Ho’s second wife, Lucina Laam. SJM subsequently announced that Ms Leong, mother of Ho’s five youngest…

22.04.2021

The 20/80 Rule Of Effective Thinking

“Without thinking things through, you might end up doing the wrong things. Remember that poor outcomes in life are excusable but poor thinking and decision-making are not. The reason is that you do not have any control over the former—but you do have all the control over the latter. That’s why the 20/80 ratios will probably save you a lot of time, money, and worry. When you take time to think things through, you’re less likely to make emotional decisions. When you’re decisive, you make a decision and stick to it—which is ultimately how we achieve our goals.” Darius Foroux…

22.04.2021

Tax. It’s one of those words that gets emotions stirring

Tax. It’s one of those words that gets emotions stirring. We know the benefits of tax to society but why do people seek to pay less? Often because they deem the tax they pay is unfair to them. I like another word, perspective. How can you see tax differently? With a new perspective? So tax ends up being fair to you. You can build complicated structures in an effort to save tax today, but do you always save tax or do you think you have saved tax? There is a difference. In the world of inheritance tax, people make some…

22.04.2021

“There are two ways to be fooled. One is to believe what isn’t true; the other is to refuse to accept what is true.”

A lost dog strays into a jungle. A lion sees this from a distance and says with caution, “This guy looks edible, never seen his kind before”. So the lion starts rushing towards the dog with menace. The dog notices and starts to panic but as he’s about to run he sees some bones next to him and gets an idea and says loudly, “Mmm… that was some good lion meat!”. The lion abruptly stops and says, “Woah! This guy seems tougher then he looks, I better leave while I can.” Over by the tree top, a monkey witnessed everything….

22.04.2021

Investing is as easy as giving up smoking.

Why should giving up smoking be hard? You stop buying cigarettes and stop putting them in your mouth and lighting them. So easy. I’m not a smoker so I have no real experience, but we all know changing habits is not that easy to do. The instructions to give up are straightforward but actually doing it is another level. Investing solutions can be simple, yet they are never easy. Being able to do the right thing at the right time means making decisions you might not want to make. That is hard to do. Your existing habits want to prove…

22.04.2021

How do you become a better investor..less of an amateur.

It starts with thinking. If you are on Twitter, you can follow this thread from Shane Parrish. It highlights the difference between amateurs and professionals. It’s not investment specific, but you can adapt your thinking to make it more investment-led. Here we go: Amateurs solve the symptom. Professionals solve the problem. Amateurs think in absolutes. Professionals think in probabilities. Amateurs think disagreements are threats. Professionals see them as an opportunity to learn. Amateurs have a goal. Professionals have a process. Amateurs think they are good at everything. Professionals understand where they have an edge. Amateurs value intensity because it makes…

22.04.2021

Optimism vs likelihood. How do you measure your investing?

I read somewhere that “As a scientist, you are not optimistic, you think in likelihoods” When you are investing your money, should you think like a Scientist? Anyone can invest on the basis of optimism, as its hopefulness and confidence about the future or the success of something. The role of wealth managers and asset managers is to communicate feel-good stories that make you feel optimistic. If you believe them because they make you feel optimistic, you’ll probably make decisions they want you to make. You’ve bought the story. So how do you make your decisions more Scientific and based…

20.04.2021

“The grim irony of investing, then, is that we investors as a group not only don’t get what we pay for, we get precisely what we don’t pay for. So if we pay for nothing, we get everything.”

Its a quote by John Bogle’s book, “The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns” The explanation is “In other words, every dollar you don’t pay to an active manager is a dollar of return that belongs to you, not the manager. Reality turns out to be just the opposite of the adage: “You get what you pay for.” When you invest your money and you delegate someone else to look after it for you, does capitalism mean they should charge as much as possible? They are in business…

20.04.2021

Investing is easy when markets go up.

By and large, most investors have experienced a positive return on capital. Warren Buffett explains the term, “A rising tide floats all boats”. At present, most investors are doing well. The tide has been rising. It matters little who manages your money as you are still in profit. It’s also easier to do nothing and float on the tide. There is no effort required. It is also when people get blasé. They stop trying to understand success because it just happens. If the worst of portfolio managers or wealth managers can exist simply because of the tide, how do you…

20.04.2021

How Bernie Madoff Fooled the World

Hopefully, you have heard of Bernie Madoff. If not, google him. All investors should be aware of Bernie and his escapades. John Authers, writes in Bloomberg, how Bernie Madoff fooled the world. Why now? Bernie has died in prison. Why should you care? John concludes with this statement “Regulatory changes in the wake of Madoff have been minimal. And so perhaps the most sobering thought as he leaves is that without the once-in-a-century crisis of 2008 he might well have died without ever being detected.” Just think about Woodford as well. The point is you have to be vigilant with…

15.04.2021

How do you know how much to invest and what to spend today?

How do you find the right balance when investing v spending today? I’ve heard the story so many times, “If I knew when I was going to die, it would be so much easier to know what I can spend” Yes that’s rather too simplistic. It’s more complicated. But it’s a thought process you need to address and consider carefully. Why? Here are some words from the philosopher Alan Watts. ..”Same with dancing. You don’t aim at a particular spot in the room, that’s where you should arrive, the whole point of dancing is the dance. Look at the people…

13.04.2021

Value is subjective

This is a response to a Tweet from Steve Sanduski, CFP® from the US. “All investments, speculative or otherwise, are valued based on sentiments, feelings, and emotions. And the more left-brained a person is, the more they use fundamental analysis to justify what they are emotionally feeling.” Think back when you make a purchase. It can be a car, a suit, a painting, or an investment. You generally feel good and will justify your purchase as being a good one. Why? It makes you feel good. You can use whatever skills you have at your disposal to justify your actions….

26.03.2021

CBDC and Bitcoin…

“The Bahamas is one example: it already has a CBDC, called the sand dollar. More significantly, China is now racing to create a digital renminbi, sparking US angst about competitive threats to the dollar. Which might explain why the Fed has suddenly teamed up with MIT. This may not be as thrilling as a Musk tweet. But the key point is that if such initiatives eventually fly, they could displace some of the rationale for private sector crypto projects. The would-be disintermediators of fiat currency might thus be disintermediated themselves. If so, that would be distinctly ironic. Bitcoin investors should…

26.03.2021

“Help clients avoid making the mistake that investors make most.”

Joe Duran, head of Goldman Sachs Personal Financial Management in the US, says ” The biggest mistake investors tend to make is “your time perspective and your emotional biases … cloud your decision-making,” according to Duran. As humans, “we are naturally drawn into what we’re experiencing right now and feel the need to act … because every financial decision is emotional” and “every investment decision is a conflict between the fear of losing out and the fear of losing money,” he noted, likening it to a “tug of war.” However, “the minute you’re feeling emotional, your decisions are going to…

17.03.2021

‘If everyone else was jumping off the Brooklyn Bridge, would you?’

Alex Rosenberg has been in conversation with Rory Sutherland, (An adman by profession: he’s vice chairman at Ogilvy). Sutherland says that humans are largely a pack animals; we tend to do what others are doing. This is related to our tendencies toward risk mitigation. By blending in, we make it less likely that something terrible will happen to us (whether in the jungle or in the workplace). As a consequence, we are highly attuned to social cues. If a lot of other people are doing something, we assume it can’t be too big of a mistake. In fact, this assumption…

17.03.2021

Dad, a Death Sentence and the Planner Who Set Us Straight

Ron Lieber is a personal finance columnist with The New York Times. He writes about his personal story about his father. “There are few things in life more fraught than conversations about illness, death and money. I know this. I’ve written about it before. But I really understood it only after my father’s amyotrophic lateral sclerosis was diagnosed in 2015. It was tempting to curse the gods, rant and rave, and lose myself in anticipated grief. That wouldn’t have been all that practical, though. Thankfully, I wasn’t managing things alone. My two siblings absorbed the news in their own way,…

17.03.2021

Your $64,000 question? And you need to answer it…

When you invest your money, you can choose between thousands of fund managers, thousands of funds, thousands of advisers…so how do you know who to trust? Do you just hope? Do you take the view similar to the monkey throwing darts? If you don’t have a clear process of being able to answer this $64,000 question, you are relying on luck. Is that a way to allocate your capital for your future? The one major problem facing investors is the lack of a process to make good financial decisions. Why is that? It’s like hiring a cook. If you hire…

17.03.2021

The latest shareholders’ letter from Warren Buffett.

“Over the years, we have purchased four additional businesses from Omaha families, the best known among them being Nebraska Furniture Mart (“NFM”). The company’s founder, Rose Blumkin (“Mrs. B”), arrived in Seattle in 1915 as a Russian emigrant, unable to read or speak English. She settled in Omaha several years later and by 1936 had saved $2,500 with which to start a furniture store. Competitors and suppliers ignored her, and for a time their judgment seemed correct: World War II stalled her business, and at yearend 1946, the company’s net worth had grown to only $72,264. Cash, both in the…

17.03.2021

a “Credo” for the individual investor

Greg Davies, a guru in behavioural finance, sets out a Credo for the individual investor 1. Successful investing requires a safe environment – above all it requires sufficient financial liquidity and/or insurance to ensure the investor gets to choose when to sell (is not forced to sell) – Work out what you can afford to invest 2. Getting fully invested as early as possible, at the level of risk appropriate to your risk profile, rather than leaving available capital unutilised delivers the best financial outcomes over time – Put it to work 3. Over time diversification delivers the best returns…

17.03.2021

“Fascinating that the richest people I know rent their houses”

It was a tweet by Noah Kagan. His friend said better returns are made by investing in his business than property and he prefers the flexibility of renting. Its an interesting question. If you run your own business, is it likely the return on your capital would be greater than the return on a property? Hopefully, yes is the answer. So renting can make a lot of sense. Emotionally owning your own home trumps logic. Of course, if you work for someone else, your opportunity cost of investing may be limited, as such, buying may work for you. The point…

05.03.2021

Is the 60/40 portfolio dead?

The majority of investors are sensible as they diversify between equities and debt (bonds or fixed interest). A 60/40 portfolio differs in risk to a 40/60 or 50/50 or even 20/80 or 80/20. The point is how much debt is in your portfolio? Our research shows Debt is a problem. In fact, Warren Buffet was quoted saying the same. I was interested in professional advisers webinar to discuss this topic. Is the 60/40 portfolio dead? What I heard makes me very uncomfortable. Let me explain. If you have a portfolio valued at £1,000,000. Based on a 60/40 portfolio, then £400,000…

05.03.2021

Are you dating your private bank?

How many relationship managers have you had? One? Five? More? Actually, that’s dating, not a relationship. One of the reasons customers use private banks is because it’s more personal. You are prepared to pay more because you want access and service. It’s been that way probably since the start of private banking. Is it the future? Within the banking world, the purpose of a good relationship is to sell the banks products and services. We all know that and customers accepted the conflict. The ‘trade-off’ seemed ‘fair’. But is it fair? It is clear the cost of products is still…

02.03.2021

The Greek fisherman and the Harvard businessman

A boat docked in a tiny Greek village. An American tourist complimented the Greek fisherman who was resting in his boat on the quality of his fish and asked how long it took him to catch them. “Not very long,” answered the Fisherman. “Then, why didn’t you stay out longer and catch more?” asked the American. The Fisherman explained that his small catch was sufficient to meet his needs and those of his family. The American asked, “But what do you do with the rest of your time?” “I sleep late, fish a little, play with my children, and take…

02.03.2021

Are you good at economics?

If you want to sell more units, do you raise the price or lower the price? The obvious answer is to lower the price. It makes sense. On what occasions do you raise the price to sell more? Its seems counterintuitive, but one answer is to sell luxury goods. Is that the only answer? Another answer is to bribe the other person’s buying agent! This was highlighted by Charlie Munger. What he means is that there are many instances where ‘bribery’ is common. You don’t see it as bribery, but you raise the price to enhance sales. He uses mutual…

02.03.2021

“But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger.”

Seth Klarman, the founder of hedge fund Baupost Group, has told clients central bank policies and government stimulus have convinced investors that risk “has simply vanished”, leaving the market unable to fulfil its role as a price discovery mechanism. “With so much stimulus being deployed, trying to figure out if the economy is in a recession is like trying to assess if you had a fever after you just took a large dose of aspirin,” he wrote. “But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger”…

27.01.2021

Victims lose average of £45,000 in investment scams

This was a headline from the BBC. Victims lose average of £45,000 in investment scams . We think it’s important for investors to be more in control over their financial decisions. Yet being a DIY investor brings with it extra risk. How do you know when you are being scammed? Obviously, people don’t otherwise there would be no one falling for the scams. Technology is allowing the scammers more opportunities, not less. I’ve heard people say, if your clever, you won’t get scammed. Yet to have the confidence to be a DIY investor, you are clearly not stupid. Smart people…

27.01.2021

Why you never deal with a private bank without a bodyguard.

It’s a story about David v Goliath but David never wins…it’s always the Goliath. You’ve made it. You have enough money to be targeted by private banks. Coutts, UBS, Credit Suisse, Rothschild, Adam, Schroders…there are many you can choose. Their job is to persuade you to bank with them and invest your money. As they’ve been doing this for many decades, they are good at it. They have exceptionally pleasant people working for them. It’s easy to be attracted. In fact, it makes sense to use some of their services. If you’ve been successful, the chances are you’ve been good…

19.01.2021

Smart People Make Terrible Decisions

Yes, they do. Perhaps not you though. But if you did, perhaps you don’t believe you would ‘intentionally’ make terrible decisions. “Otherwise smart people can make terrible decisions. Think about decisions like these as described by Farham Street: Napoleon deciding to invade Russia (and Hitler doing it again 130 years later) An editor deciding to publish O.J Simpson’s If I Did It Chris Webber choosing the timeout he didn’t have in the 1993 Final Four NASA’s decision to ignore the O-ring issues on the Challenger President Kennedy’s famous blunder to continue the Bay of Pigs operation inherited from the previous administration…

19.01.2021

“Private investors are generally less well informed than professionals and, typically, in no position to move as quickly. “

These are words from an article in the FT “Wildebeest investors and the dangers of the herd. Safety in numbers is not always the best approach” Its a discussion about Herd mentality. “In a report this week from bankers Rothschild & Co, which says that investors often exhibit the same “herding behaviour” as animals, seeking “the safety and comfort of the herd”. In a boom, they pile in together into overvalued markets; in a bust, they collectively panic and dump stock.” To avoid the herd mentality, then it implies, you use professionals. It says “Private investors are generally less well…

15.01.2021

What’s good for the goose…

When a non-descript article, which can be easily ignored, is actually a wake-up call to investors everywhere. The FT interviewed a Swiss Private Banker. Eric Syz. The bank, which has assets under management of SFr27.4bn, is at a turning point. After making its name as a private bank specialising in high-performing asset management — a feature that marked it out from other Swiss banks at the time which relied heavily on tax and banking secrecy — its fund unit has suffered years of poor performance and declining assets. Private banks are grappling with rising costs and weaker margins. In the…

15.01.2021

Too big will fail

When you read this article in the FT, it discusses how a hedge fund is returning money to investors. Nothing new or interesting. Or is it? Here’s a paragraph “Hedge funds have become increasingly wary in recent years of growing their assets too much, after seeing the performance of a number of large funds suffer. Extra assets can mean higher management fees for the fund’s managers, but becoming too large is increasingly seen as hindering performance because it can make it harder for managers to sell out of positions quickly and easier for rivals to identify their trades.” This is…

15.01.2021

Should wealth managers contracts of employment be disclosed to clients?

A journalist obtained a copy of a St James Place contract and sent the story out on Twitter. There was the response from St James Place partners suggesting that why should such an agreement be made public. In the tweet, I suggested they should be disclosed to their clients. That point wasn’t appreciated by St James Place partners! One said, ‘Should I ask to see an employees contract of employment’ from Supermarkets was a reply. I said no because the feedback loop by making a mistake buying the wrong cauliflower, tin of bins, deodorant..was very small. If they were bad…

12.01.2021

Would you challenge a loved one’s will? One in four would dispute bequests if they don’t get a fair share

The title is the headline from an article in the Daily Mail online. You may be thinking of finalising your Will or have already done so, but how would you feel if your beneficiaries, which in all probability are your family, may dispute your wishes? It can feel massively ungrateful. Yet it’s all about how people define what is or is not fair to them. We see family problems over money. Mostly they arise because of communication issues. Whilst it’s important to make a Will, it can be disheartening if your wishes are disputed. This happens because the estate plan…

07.01.2021

Should you have a 60/40 portfolio allocation?

Its a question posed by Investors Chronicle. Here’s the article. We have argued for some time that bonds are riskier, which makes investment portfolios potentially not as suitable. A recent study by asset manager Man Group also suggests that a 60/40 portfolio may not offer as much diversification as you think. The asset manager studied the performance of global equity and investment-grade bond markets over the last 80 years, and found that a 60/40 portfolio was 93 per cent correlated to equities, and only weakly correlated to bonds. Of course, there are alternative views. The FT featured a fund manager from…

06.01.2021

At age 50 you need 6x salary in your pension fund.

By age 50, retirement-plan provider Fidelity recommends having at least six times your salary in savings in order to retire comfortably at age 67. By age 55, it recommends having seven times your salary Fidelity offers a timeline to follow if you want to save 10 times your final salary by 67: By age 30: Have the equivalent of your starting salary saved By age 35: Have two times your salary saved By age 40: Have three times your salary saved By age 45: Have four times your salary saved By age 50: Have six times your salary saved By…

06.01.2021

12 Questions To Ask When Hiring A Financial Advisor

Hiring a financial advisor is a pretty big decision. This may be the first time that you are allowing someone else into such a private part of your life. You are looking for someone who is trustworthy, knowledgeable, experienced, empathetic, and someone who shares similar values with you — so how do you go about figuring out if this person you are meeting with is the right advisor for you? Well, the best way to get to know the advisor is by asking good deep questions. In order to help you come prepared to that first meeting with an advisor,…

06.01.2021

On 5th Jan 1 Bitcoin equals £23,111.82

Should I invest in Bitcoin? JPMorgan Predicts Bitcoin Price Could Rise Over $146,000 in Long Term When the banks start being greedy, I start to worry. The issue isn’t Bitcoin, but asset allocation. If you invest in an asset, such as Bitcoin, how much of your wealth do you allocate? At £23,000 for 1 Bitcoin, are you going to invest if you only have £50,000 available? If you have over £2m, is 1% of your assets worth the risk? These are your decisions, but what is the risk? Is it worth it? Can the investor with £2m, afford to lose…

05.01.2021

80% or more of heirs will look for a new financial advisor after inheriting their parents’ wealth.

“This Great Wealth Transfer is about to kick into a higher gear. As much as $68 trillion will change hands between various generations over the next 25 years, according to Cerulli Associates,” says Andrew Osterland of CNBC Most studies suggest that 80% or more of heirs will look for a new financial advisor after inheriting their parents’ wealth. You may ask why? There will be many reasons, but so often traditional advisers are focused on assets under management. You only need to look at wealth management firms. Schroders, SJP, Brewins etc. All the rhetoric is about managing investments in equities…

22.12.2020

Are you using wealth managers to lose you money?

No, it’s not a stupid question. If the average cost of managing a portfolio for a retail investor is 2.5% pa and the return on bonds/fixed interest which form part of the portfolio is less than 2.5%…doesn’t that mean you are paying someone to lose you money? Simple maths.

18.12.2020

We all want to believe what we are told and believe what we see…

Tiffanie Wen writes for the BBC “A picture may say a thousand words, but what if the photograph has been fabricated? There are ways to spot a fake – you just have to look closely enough.” We can be duped easily. We have no real reason to be sceptical when presented with something that looks like what you expect. I recall my TD teacher at school saying “If it looks right, it is right”. There are no flags to say, take a step back and think about the information you are presented with as it may not be what it…

18.12.2020

Taxing the rich

“Taxing the rich may now be the most consensual proposition in politics. It looks like the next political trend. Surveys for Rainer Zitelmann’s recent book The Rich in Public Opinion found much the same: large majorities in the US, UK, France and Germany backed “substantially” higher taxes for millionaires. Even most US Republicans support a wealth tax, even if it’s not called that.” says Simon Kuper of the FT. What is the definition of rich? Clearly, it’s subjective. And whatever colour of politics you follow, it will be deemed unfair to some. If you are ‘rich’, unfairness may well be…

18.12.2020

Is DIY investing only about the ‘top coat of paint’?

The painter has been. The topcoat is on. It looks great. If you give a door a fresh coat of paint, it will look better. What you see is therefore a great outcome. Over time, however, what you see after each coat of paint is a problem. The layers easily chip. The definition in the moulding is lost. And when you try to fix it, a light sanding will no longer work. In other words, what’s underneath the topcoat is vital. Do some decorators take more time and effort on what’s important? After all, once the topcoat is on, you…

18.12.2020

Rick Shiels Golf – YouTube. Whats golf got to do with investing?

I happened to find Rick Shiels golf via Facebook and You Tube. He has over a million subscribers and I think he gives some good tips. If every golfer watched Rick, would they be able to hit the ball like Rick? The answer is NO. If the answer was YES, every golfer would be watching and improving their game. The point is just because a solution is explained to you, it doesn’t mean you can do it yourself. If you employed Rick with one to one lessons, would your golf be likely to improve compared to watching his tips? YES….

18.12.2020

Would you pay 66% costs and fees in your pension fund?

Take a look at the article in the Express. . A graph shows it takes 25 years to accumulate £100,000 paying £154 per month and indexed at 2%. The average UK investors pay on average over 2% per annum in costs and fees. So when the investor reaches 25 years, based on 2% costs, about 66% of monthly premiums are taken to cover these fees. When you pay for investment services, you might think percentage fees are relatively small, but sometimes you need to look at things from a fresh perspective. How did we get to 66%? When fund and…

18.12.2020

⭐ ⭐ ⭐ ⭐ ⭐ How many stars would you give?

I recently purchased an item for Christmas and then received an email from Trust Pilot to request feedback for service. If a sales consultant received a bonus for 5-star reviews, do you think they will be motivated to encourage you to give a 5-star review? Absolutely. If the marketing department can say on their web site, they have 5-star service reviews in 95% of purchases. That sounds helpful to new customers. But do you ever think reviews are cherry-picked? And in the world of investing it’s so complicated, how can every customer give a well-thought-out reasoned response to feedback? If…

18.12.2020

Morningstar research has demonstrated that fees are a reliable predictor of future returns.

A recent study by Morningstar explains that European investors are paying less in fees, on average, than ever before. A new study analyses trends in fees for a group of equity and fixed-income investment categories from 2013 to 2020 and finds that fund charges are falling. The research also debunks the myth ‘you get what you pay for’. Since I have been working within the investment industry, I can’t say how many times fund managers, wealth managers, stockbrokers…in fact, it’s the people who want to manage your money, have used the term, ‘you get what you pay for’. I understand…

15.12.2020

The doctors worked out that I’ve had over 100,000 sub-concussions during my career. Alix Popham

Its a quote from a BBC article. Alix Popham: Ex-Wales flanker on early onset dementia diagnosis “Popham describes the effects of concussions and sub-concussions on his brain as a leaking tap. “If it drips once or twice there will be no mark on the floor, but if it dripped for 14 years, there would be a big hole,” he says. “That is the damage that is showing on the scans.” I talk so often about the drip drip drip problem when investing. Each day, each week, each year, so often there can be nothing to alert to a problem. But…

11.12.2020

Does it really matter if your wealth managers charge you 1%, 2%, 5%, 10% or more?

Imagine you are happy with making 3% after inflation. You give your money to a wealth manager and they deliver on your goal. Does it matter to you if they make 5% on your money and then they pay you 3% + inflation and keep what’s left? What if they make 7% or 10% or even 15%. You still make 3% + inflation and they keep what’s left. Is there a point when you think, actually that’s not fair? If there is a point, what is it? At what point do you say, I want a better deal? Yes, my…

10.12.2020

Buy low, sell high works

“Buy low, sell high works, except when the media talking heads scare people. Market is down, media says it is the end and Mr. Buffett even piles up cash. Too scared to buy stocks. Market is up/rates are low and media says equities are the place to be. Too scared to buy bonds.” These are the words of an investor I saw today commenting on a post in the FT. It clearly shows anxiety and fear of not knowing what action to take. There will always be many sides to an argument or points of view, so how do you…

10.12.2020

How do you deal with investment anxiety?

“Nice article. My continuously biggest mistake has been to decide not to invest and then watch the stock triple and double… Every time you rethink… but now it’s too dear….. and it keeps rising and rising..” This was in response to an article in the FT, written by a fund manager. Its a story about timing. An investor clearly became anxious about their investments and withdrew from the market. There was then ongoing anxiety when to go back into the market. By looking back the investor wished they had not sat on the sidelines waiting for the ‘right time’ to…

10.12.2020

Emotions about wealth tax are running high…

“I can agree with a wealth tax on everything except primary residence and pension pots. That’s pushing the boat out too far. Just because I bought a house in Richmond a very long time ago I now need to pay £200k?! I am not doing it. Write that down HMRC. “ Its Enron like tax accounting ! So if your Net Wealth goes up.. you pay tax now.. if it decreases do you get a refund? Didn’t think so.. I work hard during pandemic and pay tax. I am not a burden of the government. Now they want to punish…

09.12.2020

Zero interest rates: what UK investors can learn from Japan

“While low or negative interest rates are still relatively new in the UK and Europe, Japanese savers have been wrestling with the phenomenon for more than two decades, since rates first hit zero in 1999.” says the FT “In a world with low returns, as well as growing job insecurity and uncertainty about the future of public pensions, potential savers wanted to hold on to what they have rather than take risks in pursuit of high returns. “Many of our customers are older and rather than aggressive investments they want to preserve their capital,” says Mr Matsuda.” This is a…

04.12.2020

The sophistication effect

“The better-informed and cleverer you are, the more vulnerable you are to certain biases, such as motivated scepticism, because you are more able to destroy the arguments that you don’t like, but still feel no particular desire to examine the ones that you do. So it becomes easy to tear down silly arguments by your opponents, and so you become ever more convinced of your own brilliance and their idiocy or malignity.” I see often investors believe what they do is right. Not because it is right, but because it feels right. The trick is to be open-minded enough to…

03.12.2020

Is your wealth manager smart?

James was very clever. He found school easy. The same was true at university until when he did a PhD he realised he was not as smart as he thought he was. In a small group of PhD students, James was average. Having been told how clever he was most of his life, his ego had taken a bruising. How does this story relate to investing your money? You only need to look at the FT funds pages, there are thousands of funds available for investors to buy. Each fund is run by smart fund managers. In fact, you expect…

03.12.2020

How to talk to your children about money?

“At a recent reading of a will, the three daughters and one son of the deceased had a rather sharp shock: the son was to inherit the business, and the daughters would get nothing. None of them had any idea about their father’s plans. Rather than leading to an unpleasant family feud, the outcome was a happy one. The son approached his wealth adviser and said he wanted everything to be shared equally with his sisters, who readily agreed. But advisers to some of the world’s richest families say that the only surprising thing about this story is that a…

03.12.2020

The devious art of lying by telling the truth

Sounds crazy right? Being ‘frugal with the truth’ is a term which implies someone is not lying to you, but they may not be giving you the whole picture. In some respects, it’s up to you to fill in the blanks. That’s fine providing you can fill in the blanks. In the world of investing, that’s never simple or easy. So how do you lie by telling the truth? Here’s an example from Melissa Hogenboom writing for the BBC Future “.. your mum asks if you’ve finished your homework and you respond: “I’ve written an essay on Tennessee Williams for…

03.12.2020

Scrap taxes and start a new system afresh….hmmmmm!

According to the FT, The UK system of taxing capital is broken but introducing a wealth tax risks making the situation worse, a former top civil servant at HM Revenue & Customs said. Edward Troup, previously first permanent secretary at HMRC, told MPs “We have a lot of taxes on various aspects of capital . . . none of them work properly,” said Sir Edward on Wednesday, citing capital gains, inheritance and council taxes as examples. “It’s always better to try and fix what you’ve got than to pile something else on top of it.” Politicians should focus on thinking about whether the existing system was…

03.12.2020

“Most people don’t put in the time’ to do it”

Its a quote by Mark Cuban, entrepreneur and investor. In the 1990s, Cuban founded and sold several start-ups that helped him reach billionaire status. And in 2000, he paid $285 million for a majority stake in the Dallas Mavericks. (Under his ownership, the team won an NBA championship in 2011 and is now valued at an estimated $2.3 billion, according to Forbes.) But, according to Cuban, “the best investment I ever made was investing in myself, first and foremost,” he told Men’s Health in an interview published Sept. 1 Investing in yourself. Why do so many investors delegate to wealth…

27.11.2020

“I could shoot someone in the middle of Fifth Avenue and I wouldn’t lose a single vote.”

Its a quote by Donald Trump. In an article, The politic of Humiliation, Dave Trott, discusses how everyone is struggling to understand the rise of populism in politics. When Donald Trump is so obviously awful, how can his base still support him with all the evidence against him? “Trump understands this effect – he said: “I could shoot someone in the middle of Fifth Avenue and I wouldn’t lose a single vote.” Trott says ” Democrats keep repeating how awful he is, and how stupid his followers are. They humiliate his supporters and expect them to admit they are thick…

25.11.2020

Cognitive Dissonance Helps Explain Why We Hate To Hear The Truth

“The old cliché is “the truth hurts” and not “the truth is like a warm fuzzy blanket that’s nice to snuggle” for a reason. The human brain doesn’t enjoy receiving information that threatens our self-esteem, shatters our preexisting beliefs, makes our daily lives more difficult, or threatens our status. Admitting that we’re wrong about something, or even partially at fault, isn’t easy, even when it’s for our own good. When the truth hurts, we want to protect ourselves from the pain and so we find a way to shut down, stop listening, or otherwise resist. And we’re not always aware…

25.11.2020

What happens to my pension if my employer goes bust?

This is one of a series of questions posed by the FT writes Josephine Cumbo. The FT writes in answer to the question. “If you are a member of a defined contribution pension scheme and your employer closes, the money you have already built up in your pot, including contributions made by your employer, will remain yours. If you have a defined benefit pension, you will be covered by the Pension Protection Fund (PPF), which continues to pay your retirement income if your employer becomes insolvent. However, the pension will be reduced. If you are yet to reach scheme pension…

20.11.2020

My pension fund took a knock this year. How can I rebuild it?

This is one of a series of questions posed by the FT writes Josephine Cumbo. The FT writes in answer to the question “The pandemic has taken a heavy toll on stock market-based pension portfolios. The typical retirement fund lost around 15 per cent of value in March, when the virus hit, according to Moneyfacts, the financial information provider. While many funds may have since recovered these losses, those nearing retirement will face a dilemma over how to rebuild their funds if they are severely dented. Mr Smith of Tilney says savers in this age group might want to consider…

20.11.2020

I have received a sizeable redundancy payout. Should I put this money into an Isa or my pension? I am in my forties.

This is one of a series of questions posed by the FT writes Josephine Cumbo. “If you really want to maximise the cash, putting it into a pension means it will attract tax relief. That’s a 20 per cent boost straight away, and through your tax return you can claim additional relief depending on your marginal income tax rate. This will depend on your earnings to date and salary when you get a new job. You should consider speaking to a financial adviser about this.” says an adviser. Redundancy is a big issue and you need to think about whether…

20.11.2020

I need money for living costs. Should I pause payments into my pension scheme?

This is one of a series of questions posed by the FT writes Josephine Cumbo. The FT writes in answer to the question above “If you do not have sufficient cash to meet your living costs, then temporarily halting your monthly pension contributions makes sense. One in 10 workers have done so since the March lockdown, according to research by Canada Life. However, advisers say you should think carefully about taking this step, and should consider other actions, such as lowering contributions, first.” Clearly, if you need money today, why save for tomorrow! The issue is being clear what you…

20.11.2020

I am 55 and considering taking my pension early to help through the crisis. What do I need to consider?

This is one of a series of questions posed by the FT writes Josephine Cumbo. The FT writes in answer to the question above “Since lockdown began in March, a rising number of over-55s have tapped into their pension pots. Recent figures from HM Revenue & Customs showed 347,000 people in this age group withdrew cash from their pensions over the three months to September — a 6 per cent increase on the same period last year. During the same period, a record 314,000 workers lost their jobs.” “Assuming that your pensions and Isas are invested rather than in cash,…

20.11.2020

Marketing or real value? Can you tell the difference?

We receive marketing emails the time from investment companies selling their wares. Here’s one that came in today. “Creating long-term value through prudent investing” Its a good sensible headline and makes sense, but read on… “Mitigating downside risks does not necessarily mean missing out on returns. The MFS Meridian® Funds – Prudent Capital Fund shows how a focus on avoiding losses has generated strong risk-adjusted performance and delivered long-term value for investors. See how avoiding losses has helped the Fund deliver a smoother investment journey than global equities during a very volatile year. With economic and market uncertainty likely to…

20.11.2020

If St James Place was operating in Australia…they would be sweating now!

In Australia, regulation has ‘upped the ante’ on vertical integration – ‘You must not advise, refer or act in any other manner where you have a conflict of interest or duty’ If you are interested, take a look here The question is this. Why? Why has regulation in Australia focused on conflicts of interest? It’s because it’s a problem. But does that mean it’s only a problem in Australia? No, it doesn’t. It just means regulation doesn’t have the power or guts to make big changes yet in the UK. Instead, it is up to the consumer to make informed…

17.11.2020

If you had the chance of building your own home, would you take it?

The idea of being in control over the building of a new home, for many people, is a fantastic buzz. It doesn’t have to mean doing the contracting, it can mean managing with oversight, but either way, being involved is immensely rewarding. A benefit of self-build is you get to see the construction. You can oversee the quality of the work. You can make decisions and alterations. Sometimes at a cost, but the results over time become worthwhile. Just knowing that the construction was done properly is very rewarding and gives peace of mind. Most people have to accept buying…

16.11.2020

What do you expect from your wealth manager?

Have you ever asked yourself this question, “what do I expect from my wealth managers?” Is it goal setting? Accountability? Administrative help? Investment performance? Tax saving? All these may be part of the decision, but have you defined what is more important to you? From various research, investment performance is at the top or close to the top. It makes sense. Would you ask for help to get the worst investment results? That would be crazy. I recall listening to a philanthropical individual a few years ago who said, “I’m quite capable of losing money myself, so I don’t need…

16.11.2020

There are no billionaires or millionaires who became billionaires or millionaires using wealth managers

When you employ wealth managers, financial advisers, private bankers, stockbrokers… their job is not to make you wealthy; that’s your job. Yet when you talk to these people, before you invest, you want to hear how successful they are at making money. Shouldn’t you be asking better questions? It is not their job to make you wealthy; if it was they would charge you differently. Think about it. The Wealth Coach, an independent financial advisory firm based in the UK. Nic Round, Chartered Wealth Manager. If you want advice from Independent Chartered Financial Advisers, click here #financialwellness #financialfreedom #getbetterreturns #investing…

16.11.2020

AMP doesn’t just have a women problem. It has an everyone problem

AMP was one of Australia’s oldest and formerly most trusted companies. Founded in 1849 as the Australian Mutual and Provident Society, AMP was a not-for-profit life insurer for almost 150 years before it demutualised in 1998. Since then it has pursued profits with gusto, if not prudence. Part of the push to privatise was to have funds to expand, with “vertical integration” all the rage in the financial services sector. Vertical integration involves a bank or other financial services company providing products all along the financial supply chain. Once a bank might have offered you just banking services, for example….

16.11.2020

Lance Armstrong says Uber investment has ‘saved’ his family

Lance Armstrong is an American former professional road racing cyclist. He became ‘infamous’ by a doping scandal and he was stripped of all of his achievements from August 1998 onward, including his seven Tour de France titles. However, an investment in UBER saved his family. “Armstrong, who has five children, did not say how much he had earned from his Uber investment but added it was “too good to be true” says the BBC How does anyone find the right investments that pay off? Clearly there are big risks with private equity investments, but also there can be big rewards….

16.11.2020

“The measure of intelligence is the ability to change.”

It’s a famous quote from Albert Einstein. According to Darwin’s Origin of Species, it is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able best to adapt and adjust to the changing environment in which it finds itself’ What decisions are you making to adapt to change? Are you making financial decisions that feel right but can you be sure they are right? How do you flush out your thoughts and ideas?

16.11.2020

Don’t expect any returns from a 50/50 portfolio

Its the title of an article by Picet. Here’s the link Most people have some form of balance in their investment portfolios. But what if the balance you take, doesn’t make you any money? This article by Picet was written in 2018. Has much changed since then? One could argue it may be worse. “Over the last five years a 50/50 equity-bond portfolio has returned 5.3% a year but this will fall to -0.1% over the next five years on Pictet’s estimates. This is a challenge investors have,’ said Pictet chief strategist Luca Paolini. ‘Five-year real return on a 50/50…

16.11.2020

“Inflation to hit 10%”

In September Druckenmiller suggested inflation could reach 10%, as reported, via Bloomberg: “The markets are in a “raging mania” and rising inflation is a big threat, investor Stan Druckenmiller said. Inflation could hit 5% to 10% in the next four to five years, Druckenmiller said Wednesday in a CNBC interview, adding that the Federal Reserve has created conditions that have sent valuations soaring. Deflation is also a risk, he said. “Everyone loves a party but inevitably after a big party there is a hangover,” he said. “We are in a raging mania.” He may or may not be right. But…

16.11.2020

Is it really possible to save £15,000 per year in wealth management fees?

Most of us have switched banks many times in our lives. Some of us will even do it every six months to chase the latest deal. But far fewer of us ever switch wealth manager, whether it be a financial advisor, private bank or investment manager. ‘It takes too long.’ ‘It’s a hassle.’ ‘I’ve known my advisor for years.’ You might have any of these reasons for staying put, but if your wealth manager isn’t the right fit for you and your portfolio is underperforming, not taking action could prove costly. Are you perfectly matched with your wealth manager? If…

13.11.2020

What does CGT review mean for investors?

“A review of capital gains tax commissioned by chancellor Rishi Sunak this week proposed big reforms to the levy, including raising CGT rates to similar levels as income tax rates and cutting the annual allowance.” writes Emma Agyemang at the FT The talk about tax is designed to soften people up and expect change. It could mean income tax for business owners who use CGT as a means to reduce tax. What about abolishing the uplift on death CGT. The CGT annual exemption to £5,000. Clearly, this is all speculation. There is probably no point in taking action. But it…

13.11.2020

Lessons From 15 Years Of Short Selling: A Veteran’s Advice

“In contrast, on too many occasions than I care to remember, I shorted a stock based on hearing a compelling thesis but doing little work myself, which often led to severe losses. The lesson here is simple: if you don’t have an edge, don’t invest!” The words of Whitney Tilson. He writes in an article Lessons From 15 Years Of Short Selling: A Veteran’s Advice If you are reading this, you’ll know what short selling is. The question is whether you should do it or not? To answer the question, you need to decide if you are investing or speculating/gambling. It’s…

11.11.2020

If life was a tennis match, when do you win?

If life was a tennis match, when do you win? The answer is at the end. But that’s too late. You actually win by paying attention to every single moment and every single point that allows you to move forward so Winning becomes inevitable. It is not good waiting until you get to retirement to find out you lost. It’s too late. The way to achieve financial success is moment by moment. What plans do you have in place to ensure your success is moment by moment?

11.11.2020

In professional sports, it’s a game about winners. In the amateur game, it’s all about losers.

It doesn’t matter what sport you pick, the ones who make it to the top, make the fewest mistakes. The amateur game is not about winning, its about losing less. The winner is the one who made fewest mistakes. The way you make money when you invest is losing the least. It’s not about the one big mistake, it’s the numerous small mistakes. The mistakes are not obvious; if they were you would have already solved them.

10.11.2020

Why queue for discounted petrol?

I saw today people queuing up for fuel at Sainsbury’s. It’s cheap. Based on 10,000 miles each year, the average saving on fuel is £50. That’s based on 4-5p per litre difference. I understand the old saying “ look after the pennies and the pounds look after themselves.” But here’s some perspective. If you have over £100,000 invested in your pension fund or ISA or general investment accounts, and you delegate the investment fund management and administration to wealth managers or IFAs or private banks….you are likely to be paying upwards of £2,000 for their services, trading, fund management, etc…

10.11.2020

Why buy negative yielding bonds?

It seems madness. Why would any investor allocate capital to lose? Here’s our research https://lnkd.in/e55Qvqa And to get a better feel here’s a video from the FT. Are government bonds a safe haven anymore? You have a choice. Want a conversation? We can always set up an informal chat about how we see the future and how it could impact you personally. Here’s the link https://bit.ly/3bvSTJs

10.11.2020

So should you use a private bank?

The key attraction of a private bank is the relationship. In 2015, a Deloitte survey with private banks and wealth managers asked what would most differentiate their institution from others in the next five years, the overwhelming majority answered: “client relationships”. “In many cases, when clients leave an institution, it is because of a lack of understanding with the relationship manager and not investment performance,” History combines ‘the relationship manager’ with ‘the products’. It’s been that way for years. But does that mean it will stay that way for years? Wealth managers and banks are having to adapt to changing…

06.11.2020

Picking up pennies in front of a steam roller

Why would anyone take that type of risk? Imagine watching the steam roller heading towards you whilst picking up pennies. It seems crazy. What pennies are we talking about? Fixed interest investments. Let’s start with the basics. You have £1,000,000 invested. The portfolio is 60/40 in favour of equities. If we assume the expected return on equities is 10% and bonds 5%. After 12 months, your portfolio is valued at (£600,000 x 10% + £400,000 x 5%) £1,080,000 before costs. According to the research the average retail investor portfolio costs at about 2.5%. So the gross return of 8%, now…

06.11.2020

How does the Monty Hall Paradox help you as an investor?

You’ll need to watch the video to understand the Monty Hall problem. If you play the game, most people tend to not switch doors as they perceive the risk is 50/50. As you will see, it is not. As such, your intuitive logic gives you the wrong answer. So the first lesson is not to jump to quick conclusions when you think they are obvious. Imagine there are 1000 doors or 10,000 doors. The logic shows its best to choose another door. When you invest, you have over 10,000 options. The logic is that what you are currently doing, is…

06.11.2020

The DIY investment market needs to be shaken up

I have read that Tillit, previously called Vinco, is expected to launch an open architecture platform with a curated list of between 100 and 200 investments funds early next year for an annual charge of 0.4%. Tillit was launched this summer by Felicia Hjertman. She said ‘The DIY investment market needs to be shaken up and brought into the 21st century. The information required to make informed decisions is often lacking on today’s platforms and the digital experience isn’t doing enough to help retail investors understand what they own and how much they are paying for it.’ She feels that investors…

06.11.2020

How do you or your IFA choose which Discretionary Fund Managers (DFM) to use?

Sometimes as an investor, you need to look at things differently. In the UK there are various WRAP platforms. In other words, an administrative platform to hold client investments. Here is a link to just one. Part of their services is access to Discretionary Fund Managers (DFM). Here are some examples. Brewin Dolphin, Brooks MacDonald, Charles Stanley, 7iM, Old Mutual, LGT Vestra, FE Invest, Thesis Asset Management, Bordier, Standard Life, Liontrust and Quilter Cheviot. This platform is called Ascentric and they have 55 on the list of DFMs you as an investor can have access to. Yes, this might be…

06.11.2020

The bias called motivated scepticism.

Motivated scepticism is highly related to the term ‘confirmation bias’, which you’ll definitely have heard of. In his book, The Righteous Mind, social psychologist Jonathan Haidt describes it like this: when we want to believe something, “we ask ourselves, ‘Can I believe it?’ Then … we search for supporting evidence, and if we find even a single piece of pseudo-evidence, we can stop thinking. We now have permission to believe.” Whereas if we don’t want to believe something, “we ask ourselves, ‘Must I believe it?’ Then we search for contrary evidence, and if we find a single reason to doubt…

06.11.2020

Self-Deception in Financial Advice

“Whenever we decide what product to buy, what investment to make, or what medical treatment to obtain, we often rely on expert advice. But what happens when advisors receive bonus payments for recommending certain products, investments or treatments? In a series of experiments with university students, we provide evidence that advisors may in these cases engage in self-deception, convincing themselves that the bonus product is also the better one, which allows them to maximize their payment while maintaining a moral self-image.” Its a study by Gneezy, Uri/Saccardo, Silvia/Serra-Garcia, Marta/Veldhuizen, Roel van: “Bribing the Self.” You can read a summary here…

03.11.2020

Do you employ your wealth manager because of meritocracy or cronyism?

“Consider the case of Acme Corp., a property development firm in a small town called Nepotsville. The unwritten rule of doing business in Nepotsville is that companies are expected to hire the city council’s friends and family members. Companies that make these strategic hires end up getting their permits approved and winning contracts from the city. Meanwhile, companies that “refuse to play ball” find themselves getting sued, smeared in the local papers, and shut out of new business. In this environment, Acme faces two kinds of incentives, one pragmatic and one political. First, like any business, it needs to complete…

03.11.2020

People don’t want accuracy. They want certainty.

“A lot of what goes on in the financial world is an attempt to rid yourself of the painful reality of not knowing what’s going to happen next. Someone who tells you there’s a 60% chance of a recession happening doesn’t do much to erase that pain. They might be adding to it. But someone who says, “There is going to be a recession this year,” offers something to grab onto with both hands that feels like taking control of your future. When you realize that making people feel better is more appealing than giving people useful figures, you start…

03.11.2020

Death isn’t optional

Caroline writes about a client “I have a friend who is 82 she has stage 4 cancer and was told it was terminal. She and I sat down about six months ago and I explained to her how she could use the spouse relief to save an inheritance tax bill of 40% on her estate which is substantial and to set up a Lasting Power of Attorney for both her health and well-being and financial affairs so that her attorneys could do things for her if she became incapable. Her children have now come to me, my friend who I…

03.11.2020

Why patterns stop you from thinking?

How do you read your telephone number? The pattern is 5-3-3. 01234 – 123 – 456 If someone reads your number, 01- 2341- 234 -56, your brain has to process what is being said. It’s not familiar. What about 012341-23456; it’s still strange. Perhaps 01- 234- 123- 456 is less strange. I like the word perspective. Trying to see things differently and to challenge existing thought processes. It’s changing from the familiar. In the world of investing, wealth managers, private banks, stockbrokers have one aim; don’t lose the money. It doesn’t mean “don’t make losses”, it means “Don’t let the…

30.10.2020

“I have never met a family that was united by its wealth.”

It was a statement made by a private banker to Stefan Wagstyl of the FT is his article “The struggle between success and succession” “The latest evidence comes in a survey published today by the private banking arm of Barclays which finds that 67 per cent of first-generation creators of family wealth are “highly cautious about relinquishing authority . . . and often maintain a position of authority well into old age.” They don’t trust their heirs’ commitment to the family business (63 per cent) or their ability to take over the management (57 per cent), says the study, which polled around 400 wealthy…

30.10.2020

Why do wealth managers and private banks tell you what you want to hear?

The answer is because they are all the same and therefore risk you going elsewhere. Think about this point. If you looked at all the institutions offering wealth management services, whilst everyone wants to be distinguished from the rest, exactly how are they that different? Usain Bolt we all know was a great runner. There were lots of runners but only one Usain Bolt. He was recognised as the best runner. Is there any wealth manager or private bank that can justifiably prove they are head and shoulders above their competitors? The answer is no. If there was, everyone would…

29.10.2020

Occam’s Razor v Hickam’s dictum

Occams Razor In layman’s terms; the simplest explanation is usually the best one. Doctor John Hickman once pointed out. “Patients can have as many diseases as they damn well please,” A patient is statistically more likely to have a few common ailments than a single big one. Lots of things tend to happen at once, so the push to find one underlying cause to a patient’s ills can lead to false precision at best, misdiagnosis at worst. When making financial decisions, it’s complicated. It’s more about Hickam than Occams simplicity. Yet simplicity often wins the day because we want things…

29.10.2020

Ninety-six percent of cancer patients claim to be in better health than the average cancer patient.

Ninety-four percent of professors say they are better-than-average teachers. Ninety percent of students think they are more intelligent than the average student. Ninety-three percent of drivers say they are safer-than-average drivers. If you think you are already above average, you don’t need to try harder. You’ve reached your destination. Its easier to think this way as it takes no effort. What if instead, you thought you were below average? Would you try harder? Would you ask more questions? Would you be more curious, open-minded? Would you seek better solutions? Would you make sure your money was working harder? The answer…

29.10.2020

Do you ‘tack’ or a ‘gybe’.

Talk to any sailor and they will tell you the journey to get from A to B is a constant battle of trying to stay on course. The elements are continually pushing the boat one way and then another. It means you need to react and stay focused on your course. Yes, it involves tacking and gybing. You cannot set a course when you start and hope you’ll reach your destination… you need to be constantly ‘ tacking and gybing’ How often are you tacking and gybing in your financial journey?

29.10.2020

How Many Funds Outperformed in 2016, 2017, 2018, and 2019? Less Than 13%.

According to Institutional Investor, just 12.9 percent of the 155 domestic equity funds that exceeded their benchmark in 2016 maintained their winning streak in each of the following three years. That’s almost 13%. Is that good or bad? It doesn’t sound good as the chances are investors will fall into the remaining 87%. So over 3 years, there is an 87% chance of not outperforming. That certainly doesn’t sound good. Would you buy those odds? But it doesn’t get better. The statistics are over 3 years. Over 15 years according to SPIVA data from March 2005 to March 2020, and…

29.10.2020

Open Banking could end vertical integrated firms

“A hundred years ago, the motor industry’s supplier network was too small to cope with growing demand. Henry Ford decided the solution was to own the whole value chain. He bought and established coal and iron-ore mines, rubber plantations, a railroad, freighters, sawmills and numerous other suppliers to keep the largest car company in the world running. It was a success, helping the Ford Motor Company become arguably the most influential business of the 20th century. Competitors followed suit, and for the next half a century, vertical integration became the gold standard of business strategy. But times have changed. As…

28.10.2020

Are You a Myopic Investor?

Did you know people may be impulsive, emotional, or myopic about their own investments, but usually not about the investments of others? Why is that? If you were offered a gamble where you had a 50% chance to lose £100 and 50% to win £200, would you accept it? Chances are that you would reject it. This gamble is now known as the famous Samuelson’s gamble, where Paul Samuelson offered the above gamble to a colleague. His colleague declined to play it once, however, he commented that he would play the gamble if it would be repeated a hundred times….

27.10.2020

75% of investors who plan to retire in the next five years are rethinking their plans for retirement because of the impact of COVID-19.

Has virus-induced volatility affected your retirement plans? If it has, you aren’t alone. A recent survey of Fidelity investors shows almost three-quarters of investors who plan to retire in the next five years are rethinking their plans for retirement because of the impact of COVID-19. While global markets have shown signs of recovery since their steep sell-offs, reduced pension savings pots remain front of mind for those with one eye on giving up work. 61% of respondents due to retire within the next five years have seen the value of their retirement savings fall. And more than half of all…

27.10.2020

Deed of Variation & Transferable Nil Rate Band Planning

Susan is a seventy-five-year-old widow. She has four children and several grandchildren. Her second husband, Robert, died recently and she has therefore been widowed twice. On both occasions she fully inherited, meaning that the NRB of each deceased husband was 100% unused. In situations such as this where there is more than one marriage, the survivor’s NRB (i.e. Susan’s) can never be increased by more than 100%. Susan is domiciled within the UK for IHT purposes, with estate and Inheritance Tax (IHT) planning high on her agenda. The advice Her adviser explains that Susan could consider a Deed of Variation…

27.10.2020

“A crash is looming.”

“The dollar index fell 33 per cent in real terms both in the 1970s and the mid-1980s, and another 28 per cent from 2002 to 2011. During those three periods, the net domestic saving rate averaged 4.9 per cent (versus -1.2 per cent today) and the current account deficit was -2.5 per cent of gross domestic product (versus -3.5 per cent today). With the US having squandered its exorbitant privilege, the dollar is now far more vulnerable to a sharp correction. A crash is looming.” This comes from an article in the FT The end of the dollar’s exorbitant privilege…

21.10.2020

Are you looking for Negentropy?

Negentropy is reverse entropy. It means things becoming more in order. By ‘order’ is meant organisation, structure and function: the opposite of randomness or chaos. … The opposite of entropy is negentropy. The magnet of entropy pulls us towards short term thinking and action. It’s uncomfortable to change our thinking towards the long term. Yet it is precisely what is needed.

21.10.2020

Are you brave enough to do a flip?

“Now, this is what I really want you to understand: to get into the unitive world underneath, underlying, and supporting the everyday practical world, there have to be certain alterations in one’s common sense. There are certain ideas—and beyond these ideas, certain feelings—that are difficult to get across not because they’re intellectually complicated—not at all because of that—but because they’re unfamiliar. They’re strange. We haven’t been brought up to accommodate them. In exactly the same way that, in past times, people knew that the planets were supported in the sky because they were embedded in spheres of crystal. And if…

21.10.2020

Five reasons why you need a financial planner

I received an email from Brewin Dolphin with the title, “Five reasons why you need a financial planner”. It highlighted the 5 as” Defined goals Expert knowledge Skilled implementation Regular reviews A cool head So if you employ a financial planner from Brewins, you expect services related to these needs. However, Brewin charges for services based on how much money you have! What has how much money you have to do with financial planning? They are clearly more interested in investment management, which is totally different. It’s easy for us to see through their marketing but sadly clients may think…

21.10.2020

“Competence, like truth, beauty, and contact lenses, is in the eye of the beholder”

It’s a quote by Laurence J Peter. Who is Laurence J Peter? Ever heard of the ‘Peter Principle? Yes, you know this saying. “Every employee tends to rise to his or her level of incompetence – Laurence J Peter” David Robson is the author of The Intelligence Trap: Why Smart People Make Dumb Mistakes, and he discusses Laurence J Peter here. He writes” If you frequently find yourself frustrated with your own boss (and their reluctance to give you a promotion) or with your subordinates (and their inability to carry out your instructions) it’s worth considering the possibility that you’ve already…

20.10.2020

Buying, holding and selling art – how to avoid common pitfalls

Art advisor Willem-Joost de Gier for Cadell writes an article for Private Bankers Julius Baer discussing art as an investment. The one quote that interested me was “look for conflicts, check the facts and drive competition”. People talk to us about wealth in general, so that includes art. If you are going to asset allocate your wealth, investing into art is an option. It is also fraught with uncertainty on many levels. Willem-Joost de Gier says “I have met countless successful entrepreneurs or investors who are excellent negotiators, numbers-driven and sceptical in their daily jobs. When they enter the art…

20.10.2020

Do you take any notice of disclosure notices issued by wealth managers and investment providers? Do they help you make better decisions?

“Jump at your own risk.” Standing on the edge of a cliff, looking down at the water, seeing people jump, it doesn’t look that dangerous. If others are doing it, you do the same. So why is there a warning on the top of the cliff? We see the warnings ‘past performance is not a guide to future returns’ but all the providers issue charts and documents that explain and show past performance…all of which you are supposed to ignore. In a study, Disclosure: Psychology Changes Everything. The writers ‘review literature examining the effects of laws and regulations that require…

19.10.2020

Multiplying by Zero

We all know if you multiply by zero, you get zero. Obvious right? 1×0 =0 234,456 x 435 x 54 x 0 =0 Here’s a story. Suppose you were trying to become the best basketball player in the world. You’ve got the following things going for you: 1. God-given talent. You’re 6’9″, quick, skillful, can leap out of the building, and have been the best player in a competitive city since you can remember. 2. Support. You live in a city that reveres basketball and you’re raised by parents who care about your goals. 3. A proven track record. You were the player of the year…

16.10.2020

Do you buy quality from investment brands?

Coutts. It’s my understanding The Queen banks with Coutts. You can imagine, if it’s good enough for the Queen, then it’s good enough you, right? You have a choice between 2 cars. Similar in every way, except one, is a Mercedes and its more expensive. Which would you buy? A Ralph Laren polo versus an unbranded polo, both look the same in terms of quality. Which do you buy? A bottle of Red wine for £7 versus another for £28. Clearly not 4 x as good, but 4x the price. Which would you buy? When you invest your money for…

16.10.2020

Do you have £100,000,000?

You may or may not be worth £100m, but the number is irrelevant. But if you have £100m, would you be more concerned about hanging onto your £100m MORE than growing it? Is the fear of loss greater than the desire for more? The more you have, you more you can lose? I often see investors who focus on returns at the point of investing, but then focus on the risk of getting their money back when expectations are not met. How do you get the balance right between greed and fear?

16.10.2020

When access to all information is common, attention to important information is rare.

James Clear said “When access to all information is common, attention to important information is rare” The late Herbert Simon, an economist, psychologist and Nobel Prize winner, said this about information overload, “…information consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention.” With so much information available to you, it can be hard to know what is good and useful information and what is not. The investment industry is full of information. Much of it ‘feels’ useful, but is it? We all need someone to talk to so we can make sense of the…

14.10.2020

Inside the Greatest Trade of All Time

“There are many worthwhile candidates on Wall Street for the Greatest Trade of All Time. There’s Jesse Livermore’s bet that the stock market would fall in 1929. He pocketed something like $100 million in profit, akin to $1.5 billion today. There is George Soros’ 1992 bet that the British pound would fall against a basket of other currencies. When it did, the Hungarian-American investor made $1 billion. Then, of course, there is John Paulson’s extraordinary bet in the years leading up to, and through, the 2008 financial crisis that the market for mortgage-related securities would collapse. He made a profit…

14.10.2020

Pandemic will cause ‘lasting damage’ to living standards, IMF warns

“The coronavirus crisis will wreak “lasting damage” on people’s living standards across the world and taxes on the rich and on companies may have to rise to address this economic harm, the IMF has warned. The pandemic will leave significant scars on the global economy in the form of job losses and bankruptcies and whole sectors of the economy will be left unviable, according to the fund’s first medium-term forecasts since the onset of the virus.” The title, “Pandemic will cause ‘lasting damage’ to living standards, IMF warns” is from an article in the FT. SARS was a massive problem…

14.10.2020

Accountable to Darwin vs. Accountable to Newton

Morgan Housel writes about money is some wonderful ways. He talks about Newton and Darwin, which to me is logic v human nature. If we are asked about compound interest, we generally know what that means, but accepting its consequences, human nature gets in the way. The winner is often human nature. In Housel’s words, Darwin is often in control. If you get a chance to read his article, here’s the link. If we accept that Darwin is in control, and at the same time we also have cognizance of that control, we can be mindful of Newton. If we…

13.10.2020

Are you really open-minded or pretending to be?

“If you fall in love with an idea, you won’t see the merits of alternative approaches –and will probably miss an opportunity or two. One of life’s great pleasures is letting go of a previously cherished idea. Then you’re free to look for new ones. What part of your idea are you in love with? What would happen if you kissed it goodbye?” Its a quote by Roger von Oech. I sometimes ask people do they want any help reviewing how they invest their money? Most people say no. Yet beforehand, I asked if they are open-minded; the answer is…

13.10.2020

“I want to make 10% on my investments”

It’s funny, 10% is a magic number. It’s a number that sounds realistic. Trying to make 50% on your investments sounds great but most people realise its unlikely. 10% however, sounds doable. But is it? Here is a scenario. You have £1,000,000. It is made up of £100,000 in cash and a 60/40 portfolio of equities (£540,000) and bonds (£360,000). 10% would mean at the end of the year, you have £1,100,000. That’s the target. In the real world, cash might give you 1%. Bonds 2%. So, based on mathematics, equities will need to grow by 17%. Is that likely…

13.10.2020

Beware of private equity funds

I keep seeing wealth managers promoting access to private equity. Why? Wealth and asset managers are under fee pressure in traditional markets and see private equity as a way to secure ongoing fees… and they will say you can’t get access to private equity funds without us. Your question is, why bother? Will private equity change your total returns that much? You’ll need to ask yourself how can you measure risk yourself if private equity cannot be valued fairly? It’s opaque. Liquidy is a problem. We understand that investors can easily be drawn into private equity as the story sounds…

13.10.2020

Amazon selling luxury; Silicon Valley start-up launches ‘Nespresso machine’ for whisky

When you allocate your capital for your future, perhaps where you are invested is not taking account of unexpected change. Here are 2 stories. The first, “Can Amazon upend the luxury sector?“ “If they decide to have a real go, they may get somewhere given they have so much talent, capital, and logistics and delivery expertise,” said Mr Court. “But if you don’t have Gucci, Saint Laurent, Prada and Dior, then it’s hard to be a real destination for luxury shoppers. You need the brands you can find on Avenue Montaigne in Paris.” The key focus is on how relentless…

09.10.2020

Yikes!! Why are you investing to lose money?

Yikes. I’m convinced UK investors haven’t got the message yet. I use the word, Yikes, as the headline in the FT is “Why investors are not likely to cry out ‘yikes’ over UK debt” Here’s the background “Interest rates are negative on bonds up to maturities of six years, meaning investors are willing to pay the UK to borrow for more than half a decade. The Treasury’s debt managers can borrow money for 30 years for less than 0.9 per cent.” Imagine you are a 60/40 investor. Your portfolio of pensions, ISAs etc is valued at £500,000. That means £200,000…

08.10.2020

Procurement…why its relevant in wealth management space

What is procurement? “Procurement is the act of obtaining goods or services, typically for business purposes. Procurement is most commonly associated with businesses because companies need to solicit services or purchase goods, usually on a relatively large scale.” I was interested in LinkedIn members website. It said “From our experience, we recognise that it is not financially feasible for organisations to employ full-time procurement specialists across the full spectrum of goods and services that can be purchased. These challenges culminate in non-purchasing trained employees making significant purchasing decisions without the tools or knowledge of the supplier market. This puts them…

02.10.2020

Open banking and digital investing

There is a revolution in finance but for most people can’t see it or feel it. There is a lot going on but most of the population don’t notice any change. Yet. You may have heard of Robo Advice. Open Banking. What is clear, technology will change the way we use money. Firms like Open Money will develop new ideas; creating new applications for mobile smartphones. Whilst we will end up using these services, especially if the banks elect to cut their branch network, as apps become the tool of communication and action. Yet, one thing does not change. Each…

02.10.2020

1/3 of investors don’t know if their adviser is independent or not!

In a survey by the FT, I’m hugely disappointed to hear that 1/3 do not know if advisers are independent or not, but not surprised. The FT report “About a third of readers who completed our survey confessed they did not know if their adviser was restricted or independent. One reader made the point that by restricting the range of investment options, “the term financial adviser is a misnomer; almost all ‘advisers’ are just product distributors or salespeople and need to be treated with appropriate care and caution.” There were many other comments about readers’ dislike of “fee-driven advice to…

02.10.2020

How do you make sense of investment information that’s everywhere?

Nobel Prize winner Herbert Simon said in 1970s: “In an information-rich world, the wealth of information means a dearth of something else: a scarcity of whatever it is that information consumes. What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.” So how do you make sense of the information? Curate What You Consume. Here’s why? “Watch your thoughts, for they become words. Watch your words, for they become…

02.10.2020

The toughest moral test lies ahead.

“Vaccine Confronts Humanity With Next Moral Test. Who gets coronavirus protection first (and last)? Who profits (and loses)? What is “informed consent” (if it exists)? Divided societies face agonizing choices. How can the vaccine reach a critical mass without compulsion? … An employer might demand vaccination as a condition of reporting for work. A university might impose the same requirement on faculty and students. A vaccine might be dangled as a golden ticket to return to theatres, cinemas, night clubs or sports events. Governments or foundations could even pay people to receive a shot.” John Authers discusses this issue in…

01.10.2020

Wealth Management mission statements have 100% integrity…

“At our firm, we have the client—and only the client—in mind.” So says a large UK based wealth manager. There are various statements made by investment product providers. All want to portray that their focus is on you the client. After all, without clients money, these firms will cease to exist. In 1997, Christopher Barts paper entitled, Sex, Lies and Mission statements asked 88 senior managers about their companies mission statements and concluded ‘the vast majority are not worth the paper they are written on” Oh dear. The question is whether you believe the rhetoric. Some of the largest providers…

01.10.2020

Stocks will beat bonds and deliver annualized returns of 6% over the next decade, Goldman says

Goldman Sachs believes equities will outperform bonds by 6%. Its a prediction, so we have no idea whether its good, bad or spot on. However, when you get to think about why bonds are particularly poor, perhaps there is some substance in their prediction. Clearly, 6% is a number which may or may not be accurate but will equities outperform, the chances are yes. Of course, anyone can say that simply due to risk associated with bonds and equities. You should get more if you choose equities because they are riskier than bonds. But its more about what proportion of…

01.10.2020

Gold up 26%; lets all buy gold!

“Gold has been a shining star in a dazzling year for the exchange-traded product industry.” says the FT. “..net new flows of $64.2bn into commodity ETPs in the first seven months of 2020, up from just $7.8bn in the same period last year” “Gold is clearly seeing very significant inflows compared to last year,” said Deborah Fuhr, co-founder of ETFGI. It is possible gold may rise further. Up 26% this year sounds fantastic. Who knows if it will rise further. Gold has no yield and hard to value. History shows the average return lower than stocks. So if over the…

01.10.2020

If all wealth managers look and feel the same, what is the difference?

“Long ago, a brother-in-law of mine, Homer Rogers, was a commission agent working in the Omaha stockyards. I asked him how he induced a farmer or rancher to hire him to handle the sale of their hogs or cattle to the buyers from the big four packers (Swift, Cudahy, Wilson and Armour). After all, hogs were hogs and the buyers were experts who knew to the penny how much any animal was worth. How then, I asked Homer, could any sales agent get a better result than any other? Homer gave me a pitying look and said: “Warren, it’s not…

01.10.2020

Do you want free financial advice?

Save more, spend less. Job done. How often are you offered free financial advice? We all know its not free, well I hope we all know it’s not free. The purpose of free financial advice is a way to sell you investment products. Everyone from time to time needs help. There is always a need for financial guidance and advice, but the answers you receive can be different depending on who you ask. Generally, the person you ask is someone you like. You like how they talk, how they look and what they say. In other words, you like the…

25.09.2020

Retirement planning made easy

More institutions are trying to broaden the scope of how they sell their products and services, but also increase the depth. Legal and General have put together a course about retirement planning in conjunction with The Open University. I can see other institutions using their financial muscle power to develop these types of ideas. All of which should help awareness of financial issues. It would make sense for anyone thinking of retirement to gather as much information as possible. Read books and articles. Take course such as the Legal and General course via the Open University. Yes, there is a…

25.09.2020

Should you buy direct from a wealth manager?

Many moons ago, in conversation with a real estate agent, we talked about why it should be important for buyers to use an estate agent acting for them, not the sellers agent to negotiate on a purchase. It makes perfect sense. Yet it rarely happens. It is the role of an estate agent to act for the seller. There is a contract between the estate agent and seller that states payment will be made on the sale of the property. As such, the estate agent has the interests of the seller first. The estate agent will know from discussions with…

25.09.2020

The ultimate best buy list for investing

Firms like Hargreaves Lansdown have a ‘best buy’ list. Why do they call it a ‘best buy’ list? Surely you want the best return list. The best buy list is in the interests of the provider and the best return list is in the interests of the investor. Best buys lists are totally inappropriate.

23.09.2020

Is your adviser chartered?

I have always been intrigued why investors don’t insist their advisers are chartered. So many advisers do not take the time and effort to reach chartered status. Why not? If you ask an adviser why they are not chartered, you always get a reason that explains why they haven’t gone through the process. Some say its experience that counts. I agree, but that doesn’t stop anyone being chartered. Others say the public doesn’t care. That may be true, but that’s because if someone is regulated, the public thinks that is enough. It is for regulation but it shows little self-discipline…

23.09.2020

The FCA says: “Firms earn higher margins from consumers who are less aware”.

According to Ali Hussain of the Sunday Times, ‘The FCA says: “Firms earn higher margins from consumers who are less aware”. This is a truism if ever there was one. Making money from your customers’ ignorance demonstrates a disdain for ordinary people and it is rife in financial services’ The interesting point…who admits to being less aware? Consumers will happily admit not to being experts, but being ‘aware’ is something they will admit. So it’s about the language used and little curiosity employed. To be more aware you need curiosity. If the consumer accepts what they told at face value,…

23.09.2020

How ‘survivorship bias’ can cause you to make mistakes

“The most famous example of survivorship bias dates back to World War Two. At the time, the American military asked mathematician Abraham Wald to study how best to protect airplanes from being shot down. The military knew armour would help, but couldn’t protect the whole plane or would be too heavy to fly well. Initially, their plan had been to examine the planes returning from combat, see where they were hit the worst – the wings, around the tail gunner and down the centre of the body – and then reinforce those areas. But Wald realised they had fallen prey…

23.09.2020

Do you think of a brain surgeon as a salesperson?

The answer is probably not. Associating a brain surgeon, astrophysicist, molecular biologist as salespeople doesn’t really come to mind …but words are interesting. A wealth manager, financial adviser, financial consultant, financial partner are often terms used for financial salespeople. Yet, most people don’t use the term salesperson, but often that’s exactly what they are. There is nothing wrong with salespeople, its about context. However, you could speak with a financial adviser who is a financial adviser rather than a financial salesperson. The problem is how to differentiate? How do you know when you are being ‘sold’ to rather than ‘advised’?…

23.09.2020

Is your money management superficial?

When you first need advice, it is easy to become overwhelmed. There are so many terms and acronyms used that make it confusing. In most situations, the advisers make you feel good, so it’s easy to go with the flow. But as with so many life challenges, the more you dig deeper, the better your understanding becomes. When the sportsperson practices, they do so to get better; in the same way, the more you embrace your finances, the better your decisions and outcomes. Wherever possible, when you delegate to others, it’s important not to be asleep at the wheel. It’s…

23.09.2020

Is a wealth tax in the UK possible?

Wealth taxes, while not a new idea, are gaining popularity as a solution to the debts that governments have taken on as a result of the COVID-19 pandemic. The wealth tax has become the subject of fierce debate as progressive 2020 Democratic candidates champion it as a mechanism to redistribute wealth and curb the economic power of the wealthiest Americans. Though it’s a relatively new proposal in the US, many European nations adopted it decades ago. The wealth tax is similar to a property tax. But instead of taxing real estate, it covers wealth in all forms: stocks, cash, jewellery,…

18.09.2020

Picasso dies without a Will. So what?

When the Spanish painter Pablo Picasso died of a heart attack on April 8, 1973, he left behind not only a huge artistic oeuvre of 50,000 works, but enough family drama to cover several generations. While he had numerous lovers, he married only two women. Officially, there is only one legitimate heir to his vast inheritance: his granddaughter Marina Ruiz-Picasso. Earlier this year Sotherbys held an auction which some believed would open up more family disputes. So should Picasso have made a Will? Every lawyer would say yes and I agree. But Wills can be challenged. And if the estate…

18.09.2020

Can I protect my assets from my daughter’s husband to be?

“I am a single parent and have an adult daughter who is thinking of getting married in the next two years. I would like to draw up a will and protect my assets in case my daughter goes through a divorce. I would like everything to stay in the family, going to my daughter and then her children. What kind of trust or will enables me to do this?” This was a question asked to the FT and answered by professional advisers who suggested setting up a trust. But with these columns, it’s more about what is not said. Should…

18.09.2020

“70% fire their financial advisers when they become a widow”

According to Bill Bachrach, who trains advisers in the US, many advisers do not have a relationship with the spouse. I have no idea whether that is true or not, but from our experience, widows do talk to us. Why? When you look at the way the investment industry works, it’s really all about the money. The focus by advisers is managing client assets. The financial advisers/wealth managers and similar make more money by managing money than focusing on helping people in a much more holistic manner. Our vision is to help people feel more empowered with their financial decisions. …

18.09.2020

What rules do you have when investing?

Everyone needs to detail a framework for investing, irrespective of whether you do it yourself or you delegate to portfolio managers/wealth managers/private bankers etc… Here is a copy of a series of tweets from Chamath Palihapitiya, who explains his rules: “Investing 101: Successful investing is all about behavior and psychology. You can have the best model or analysis in the world but if you panic, you lose. Said differently, everybody has a plan until they get punched in the face. Let’s begin… The most important thing you can do to maximize the odds of success is figure out what, if…

15.09.2020

Should you avoid structured investment products?

Yes. I understand how the investment industry sells these investment products. To the naive investor, they look appealing. They promote a ‘feeling’ of security. Something that is not open-ended. It all makes sense from a marketing perspective. Once investors build their knowledge, the more likely they are to make better, more informed decisions about how to allocate their capital. If you are tempted to buy into a structured product, try to resist and think again. What is a structured product? Here’s a link to Investopedia.

15.09.2020

Will taxes rise?

It seems very plausible that taxes will rise. If every individual accepted a level of tax rise that was fair for them, it would, therefore, be fair for everyone. It may not be palatable to pay more in tax but it would be accepted with less resentment if everyone is treated fairly. What are the odds it will be fair? Unlikely given past experience. However, ‘fairness’ is subjective. It may be worthwhile looking at the tax you pay more objectively to better assess what is and what is not fair for you.

08.09.2020

Too much content and unsure what’s real or fake?

Recently a student used a programme called GPT-3, the most powerful language-generating AI tool to date, to write blogs. “What stood out most about the experience, says Porr, who studies computer science at the University of California, Berkeley: “It was super easy, actually, which was the scary part.” Take a look here. With AI writing blogs, the amount of content will multiply. Few people can differentiate between what is ‘fake’ and what is not. It’s a problem as we use the information to make decisions. We don’t want to make poor financial decisions based on ‘fake’ information. Is this a…

08.09.2020

Truth tellers v Salespeople

Truth tellers v Salespeople. Warren Buffet said “We look for three things when we hire people. We look for intelligence, we look for initiative or energy, and we look for integrity. And if they don’t have the latter, the first two will kill you, because if you’re going to get someone without integrity, you want them lazy and dumb.” How you distinguish between truth-tellers and salespeople? Often they look the same? Say similar things? You want to hire people to work with you who have energy and intelligence, but you need most of all integrity. A salesperson has his or her own agenda, it…

08.09.2020

The difficulties of untangling foreign assets

Investors are often unaware that shares or other investments they hold may be registered in jurisdictions other than the UK. This can cause delays and substantial expense. In an FT article about Video Wills, there is a note about untangling foreign assets. It gives readers stories. Here’s one “David, an FT reader, has been working for almost two years to untangle his son’s assets. It has cost tens of thousands of pounds because his son’s investments were complex and widely dispersed. Because of the delays, David has been funding the living costs of his daughter-in-law and grandchildren as he was…

08.09.2020

Could we see a tax on pensions in payment?

In the Treasury select committee’s “Tax After Coronavirus” inquiry, Paul Johnson, head of the Institute for Fiscal Studies, a think- tank, said “there was a case for retirees to pay higher taxes on money drawn from occupational, or workplace, retirement plans.” explains the FT. He went on to say, “Pension tax relief restrictions and pension tax relief have raised lots of money over the past decade..there has, of course, been no increase in the tax on pensions in payment.” There are thousands upon thousands of retirees in receipt of pensions in payments. Many receive ‘high’ guaranteed pension payments from final salary…

04.09.2020

Is pension tax free cash about to change?

In an FT article, “Tax After Coronavirus” inquiry, Philip Booth, senior academic fellow at Institute of Economic Affairs, told the inquiry that the pensions tax-free lump sum could be made less generous to help repair the nation’s finances. “I would severely limit the tax-free lump sum that it is possible to receive from pensions . . . which would allow a lot of pensions tax simplification instead of the route that the government seem to be proposing, which is to allow tax relief only at the basic rate, which I think would cause a degree of chaos,” he said. It has been talked about…

04.09.2020

How to avoid clogs to clogs in three generations

The answer is to start a conversation with us. But why? Take a look at this article here that details Warren Buffets thoughts about teaching your kids about money. “Most parents already know how important it is to teach their kids about money and how to manage it properly,” Buffett acknowledged. But there’s a difference between knowing and taking action.” Taking action is having a conversation. It is said that family firms go from “clogs to clogs in three generations”, an aphorism based on the observation that it takes one generation to found a business, the next to build it, and the third…

10.07.2020

Psychological traps investors should be wary of

“The desire to act in a crisis is deeply embedded in our psychology. But investment behaviour experts warn that this instinct is our own worst enemy when it comes to money.” “You see your portfolio falling in value and the natural thing to want to do is to protect it,” says Mr Norton. “You sell that asset that is falling in value and you feel better — almost immediately.” The FT article here talks about making decisions based on how we feel. “Research shows investors who trade more frequently have worse long-term outcomes than those who trade infrequently or not…

09.07.2020