Topic: Uncategorised

Have You Been Surprised by Retirement?

We can’t know for sure what’s ahead in retirement any more than we know about our career when we take our first job.  We might start out with a plan, but life happens, and before we know it, we can find ourselves in the midst of something entirely different.

The surprises might come right away, when the reality of retirement doesn’t match up with our dreams. They may come later, after we think we’ve got it all figured out . . . only to find we don’t. By definition, we can’t know what surprises are in store for us.

Here are a few surprises …. have you experienced others?

A child moves back home. No one’s surprised if a son or daughter returns home after graduating from university. The surprise comes when for example, a single, 32-year-old son loses his highly paid job in the city, can no longer pay his rent, and moves back in with his parents. Hopefully they find another job and then off they go on their own again, but this could take some time so be prepared and don’t make it too comfortable for them… unless of course you really do want them to stay.

Where are we living now? A close friend of mine told me he always figured he’d retire to Spain. He and his wife spent several years visiting various parts, until one weekend they stayed with some friends in North Wales. They fell in love with area and before the weekend was over, they’d put down a deposit on a new house. Now, two years later, they love it . . . but even they are still surprised they ended up in Wales instead of Spain.

The doctor calls. It is probable that we will all get a nasty medical surprise at some point. You may have had an active lifestyle in your younger days and have visions of this continuing into retirement. But the arthritis in your knees and ankles may make you rethink this. Many people are taken aback when they discover they have to limit their activities or take medication for the rest of their lives.

Are we going to work? A lot of people plan to take a part-time job after they retire, then are surprised to find out the workforce is not clambering for 65-year olds. Working at the local DIY store isn’t everyone’s idea of a dream job, and whilst some of us may be suited to a consultancy role in our chosen profession, that is not for everyone.   The other ideal is to work whether it is paid or otherwise in a sector that interests you. Volunteer at your local theatre group or independent cinema or a charity.

One of my neighbour’s volunteers to look after hearing dogs (dogs for deaf people) for one or 2 weeks at a time whilst their trainer takes a break.   This means that he gets to exercise and look after the very well-trained dogs but without any long-term commitment.

Money doesn’t matter as much. Although I find that retirement is a great leveller. Most of us expect to live on a reduced income, some savings and maybe a pension. Our income is stable. We’re not pushing for a pay rise or promotion. The pressure is off. So, a lot of people are surprised that success in retirement is less about how big our house is, or what car we drive, and more about having fun, hanging out with a good crowd, and leaving a legacy for friends and family.

We can deal with all the change. I know it’s sounds stupid, but it’s a surprise to me that after retirement, life goes on — meaning things continue to change.  We move; we have grandchildren; our kids do something unexpectedly different. We have different friends, perhaps different interests. We realise we can cope with a lot of change and adapt to new developments. Yes, some of us are surprised that we can do this!

 

Improve Your Relationship with Money by Answering These 5 Questions

Many people have a complicated relationship with money. Hang-ups carried over from childhood experiences get mixed together with positive and negative experiences through adulthood. Few people ever take the time to reflect on what money really means to them and how they can “get right” with money to make smarter decisions.

Take time to answer these 5 questions and you might find that you can do a better job of living your best life possible with the money you have.

1. What’s your first money memory?

Your earliest experiences with money probably happened in your home. You saw how your parents earned and managed their money. You probably compared the quality of your family home and vehicles to what you saw at friends’ and neighbours’ houses. An unexpected job loss or illness might have led to some very lean holidays or none at all. Or, if you grew up in an affluent household, you might have taken money for granted in a way you no longer do now that you’re the one earning it.

Identifying some of these early memories is critical to reassessing your relationship with money. Are you following positive examples towards decisions that are going to improve your life? Or, without even realising it, are you repeating poor money habits that are going to hurt you in the long run?

2. Do you feel like money is your servant or your master?

Sometimes money makes us feel like we’re a hamster on a wheel, running as fast as we can without ever really getting anywhere. But if you never stop chasing after that next pound, when it comes time to retire, all you’re going to have is money, and a whole lot of empty days on your calendar.

People who get the most out of their money recognise that it’s a tool they can use to skillfully navigate to where they want to be in life. So, instead of working too long and hard for more money, think about how to put the money you have to work for you.

3. What would you do if you had more money?

You’ve probably read about studies that show lottery winners don’t end up any happier than they were before their windfalls. This is a dramatic example proving some conventional wisdom: money doesn’t buy happiness. That’s especially true if you’re stuck on your wheel for 40 hours every week just chasing more and more money.

If the idea of having more money gets you thinking about all the things you’d buy, it’s important to remember how quickly even the fanciest new car smell will fade.

If you would immediately quit your job if you had enough money to support your family and live comfortably, then maybe you need to think about a more fulfilling career.

Having more money might not “solve” some issues you’re currently experiencing but asking what you would do if you had more money might lead you to new decisions that improve your current life satisfaction.

4. What would you do if you had more time?

Imagine you don’t have to work. You can spend every single day doing exactly what you want. What does your ideal week look like? What things are you doing? What hobbies are you perfecting? Where are you travelling? With whom are you spending your time?

These things often get pushed to the side when we’re busy working. But if your money isn’t providing you with opportunities to spend time doing what you love with the people you love, then your work-life balance might need an adjustment.

5. What would your life look like to you if it turned out “well”?

Hopefully by now you’re starting to think about how your relationship to money could be keeping you from getting the most out of your money.

The successful retirees that we work with don’t look back fondly on the amount of money they made or how much stuff they were able to buy. They tell us their lives turned out well because they used money to make progress towards major life goals. They say their money provided them the freedom to pursue their passions. And their sense of well-being increased as they committed time and resources to health, spirituality, and continual self-improvement.

When you reach retirement age, we want you to look back happily on a life well-lived. Come and talk to us about how our interactive tools and Life-Centred Planning process can improve your relationship to your money.

Three Reasons Why You Should Work Even When You Don’t Need the Money

It might sound a little crazy but there are many benefits to working even though you no longer need the money for your living or retirement needs.

These “retirement workers” have discovered that part-time jobs or volunteer positions allow them to keep a nice pace in life and find a balance among using their talents, enjoying recreation, traveling, and spending time with family. Some of our most ambitious clients even start brand new companies in retirement.

Here are three important benefits of working in retirement that might persuade you to clock back in a couple of days a week.

Working is good for you.

Retiring early is a very popular goal. But while it makes sense to want to enjoy your assets when you’re younger, some studies have linked retirement to decreased mental and physical activity and higher instances of illness.

Working keeps your mind and body active. It makes you engage in problem solving and creative thinking. It keeps you mindful of your health and appearance so that you make a good impression on colleagues and customers. It challenges you to keep achieving and rewards you when you do.

And, if nothing else, it keeps you from vegging out on the sofa all day and driving your spouse crazy!

Work can give you a sense of purpose.

Many retirees struggle with the transition to retirement because their sense of purpose and identity is so tied to their work. Without that familiar job and its schedule and responsibilities, some retirees struggle to find a reason to get out of bed in the morning. A part-time job can restore some of that sense of structure and drive.

In fact, you might find that working in retirement gives you an even greater sense of purpose than your former career did. You might have worked a job you didn’t 100% love in order to support your family. Now that you no longer need to worry about that, you can take that position at your local library or work a couple of days every week at that charity that’s making a difference in your community or a charitable organisation that’s close to your heart. You can feel like you’re making a contribution to society without worrying about the size of your salary.

Work can improve your connections to other people.

Early retirement can be a period of isolation for some. Your friends and family might still be busy working and raising children. The familiar social interactions you enjoyed at work are gone. You and your spouse probably share some common interests, but you can’t spend every single second together.

It’s important for retirees to be open to making new personal connections in retirement. A new workplace is a great place to start that process as you will meet new people from different walks of life.

You will work with and help people who can benefit from your personal wisdom and your professional skill set. You might meet other people who, like you, are trying to stay active and put their talents to good use. The more involved you are in your community, the more curious and adventurous you’re going to be about trying new restaurants, shopping in new shops, and interacting with more people.

Of course, working in retirement can affect other aspects of your financial planning even if you don’t need the money, such as taxes, withdrawal rates from your investments, and your relationship with your spouse. If you’re considering a new part-time job, why not set up a meeting to discuss any adjustments we should be thinking about so that you get the best life possible with the extra bit of money you’ll soon have.

 

A New social phenomenon – the ‘sandwich generation’

In recent years, a growing realisation has formed that we’re in the middle of a new social phenomenon – the ‘sandwich generation’. The term ‘sandwich generation’ is often used to refer to those who care for both sick, disabled or older relatives and dependent children.

With an ageing population and many people starting families later in life, ‘sandwich caring’ responsibilities are on the rise. However, new research from the Office for National Statistics (ONS) has highlighted the fact that a pensions injustice could be making life even more difficult for this group.

Twin responsibility

The report shows that almost 27% of sandwich carers show symptoms of mental ill health[1] while caring for both sick, disabled or older relatives and children. With life expectancy increasing[2] and women having their first child at an older age, around 3% of the UK general population[3] – equivalent to more than 1.3 million people – now have this twin responsibility.

Sandwich carers are more likely to experience symptoms of mental ill health – which can include anxiety and depression – than the general population (22%), according to the ONS analysis for 2016 to 2017[4].

The prevalence of mental ill health increases with the amount of care given. More than 33% of sandwich carers providing at least 20 hours of adult care per week report symptoms of mental ill health, compared with 23% of those providing fewer than five hours each week.

Health satisfaction

People providing fewer than five hours of adult care each week report slightly higher levels of life and health satisfaction, relative to the general population. Some of the differences between the two groups could be explained by demographic differences. For example, more than 72% of the sandwich generation are aged between 35 and 54 years, while 62% are women. Whereas among the general population, 38% are aged 35 to 54 years, and 51% are women.

Around 76% of those providing fewer than five hours of adult care say they’re satisfied with life, while just 10% are dissatisfied. Meanwhile, 74% of the general population are satisfied with life, with 16% saying they’re dissatisfied. However, when sandwich carers spend more than five hours a week providing adult care, they report lower levels of life and health satisfaction than the general population.

Sandwich carers

Those providing between 10 and 19 hours of adult care per week are least satisfied according to both measures, even compared with those giving at least 20 hours each week. This could be because 69% of carers in the 10 to 19-hour category are in work (either employed or self-employed), compared with 41% of those providing at least 20 hours a week.

Similarly, many sandwich carers are not satisfied with the amount of leisure time they have. Those looking after their relatives in their own home – half of whom provide at least 20 hours of adult care per week – are least satisfied.

General population

Overall, around 61% of the general population are happy with their amount of leisure time, compared with 47% of sandwich carers looking after their relative outside the home and 38% of those providing care within their own home.

As well as reporting a lack of leisure time, 41% of sandwich carers looking after a relative within their home say they’re unable to work at all or as much as they’d like. The ONS report also shows that women sandwich carers – who account for 68% of those providing at least 20 hours of adult care per week – are more likely to feel restricted than men. Around 46% of women feel unable to work at all or as much as they’d like, compared with 35% of men.

Labour market

Women sandwich carers are also much more likely to be economically inactive than men – 28% are not part of the labour market, compared with just 10% of men in the same situation. It should be said, though, that the majority of sandwich carers are able to balance their job with caring responsibilities. More than 59% of those providing care at home say this does not prevent paid employment.

Clearly, caring for two generations could have an impact on carers’ finances. One in three sandwich carers say they are ‘just about getting by’ financially, while one in ten are ‘finding it difficult’ or ‘very difficult’ to cope. Meanwhile, only 17% say they are ‘living comfortably’, compared with 32% of the general population.

Preparing for a more secure financial future

As concern grows among sandwich carers, so too does the need to financially plan for ageing dynamics and family relationships. If you’d like to talk about how we can help you understand the big questions of where am I right now and how you might get to your own financial freedom then call or pop in for a coffee.

Source data

[1] This is based on the General Health Questionnaire (GHQ), where a score of four or more indicates symptoms of mild to moderate mental illness such as anxiety or depression. The GHQ is self-reported.

[2] Life expectancy at birth in the UK did not improve in 2015 to 2017, having risen consistently for decades beforehand. The ONS investigated the stalling of improvements in life expectancy and its links to mortality rates.

[3] For the purposes of this article, the general population is all adults (including sandwich carers) aged 16 to 70 years.

[4] The ONS analysis defines sandwich carers as people aged 16 to 70 years who have a dependent child (one aged under 16 years, or 16 to 18 years, who is in school or non-advanced further education, not married and living with parent) in their home, and also provide regular service to a relative (usually parents, parents-in-law, grandparents, aunts or uncles, or another relative) who is ‘sick, disabled or elderly whom you look after or give special help to’. The analysis is taken from Understanding Society, the UK Household Longitudinal Study. Households are surveyed each year either through a face-to-face interview or a self-completed online survey. Data collection takes place over a 24-month period, and the sample size for the general population in the 2016 to 2017 period was 34,000 individuals.

 

Managing Time

As a family we enjoy holidaying in Spain, and I am always struck by the difference in perspectives on how we live in the UK and how the Spanish live. The fact that that most Spanish shops close between 2p.m. and 5 p.m. so that people can have lunch and recharge, rather than staying open and making money is very much different to our own culture.

The towns and cities slowly come to life as couples, families and friends emerge onto the streets for their evening paseo; the daily ritual of catching up by taking a stroll, having some snacks or perhaps doing a little shopping. These routines appear to make little sense amid the bustle of our modern world, but it is nonetheless an interesting lens from which to view how we help clients live their best lives.

Allocating time is as important as allocating money.  Besides money, time is another major limited resource in life, yet very few of us approach managing this aspect of our lives using the same discipline with which we manage our money.

As financial advisers we take great pride in helping clients allocate their investments as efficiently as possible but, imagine if we helped people think about how their money could get them to use their time better.

There’s scientific evidence that using money to give people more time can make them happier too. In August 2017, researchers at Harvard published a paper after studying the spending habits of more than 6,000 people in the US, Canada, Denmark and the Netherlands.[1]

They found that: “Despite rising incomes, people around the world are feeling increasingly pressed for time, undermining well-being. We show that the time famine of modern life can be reduced by using money to buy time. Surveys of large, diverse samples from four countries reveal that spending money on time-saving services is linked to greater life satisfaction. To establish causality, we show that working adults report greater happiness after spending money on a time-saving purchase than on a material purchase. This research reveals a previously unexamined route from wealth to well-being: spending money to buy free time.”

None of us dispute that one of the cornerstones to living richly is spending our limited time on the things we really care about. However, many of our discussions with clients focus on the wrong goals. So, what can we do about it?

  1. Helping people prudently spend is as valuable as helping them prudently save. Of course, as advisors we are rightly focused on ensuring that people don’t run out of money. However, there is usually a trade-off between time and money. Focusing too much on building the biggest nest egg possible sets the wrong goal for clients. Every pound saved might build more security, but it just as surely takes away from their life today. More money does nothing to improve your life if you don’t use it to improve your life along the way. Preventing clients from over-sacrificing today is as much a part of a great planner’s job as ensuring a financial plan works in the future.
  2. Priorities exist today that are as important as those in the future. Planners spend most of their time with working clients discussing their future and retirement, yet clients worry the most about prioritising all the trade-offs they have today. They want to be there for their families, find time and money for holidays, or make time in their schedules to exercise. We can help people make decisions to improve their lives immediately.   Rather than focusing solely on the longer term and sacrificing as much as possible for the future, it is important not to lose the opportunity to make trade-offs and add immediate value to people’s lives today.
  3. Discussing what really matters engages everybody. The biggest cost to our industry on spending so much time on maths and money is that it disengages the non-financial person.  Where we work with couples, that can often mean that one spouse is not involved in something that they should be making an integral part of their financial lives. By discussing time and how the money will support each person’s priorities, you connect to the universal truths we all care about.

Money might not grow on trees, but time doesn’t grow at all. One of the consequences of having a country that encourages siestas and two-hour lunches is that Spain is one of the least financially successful economies in Europe. Yet you can’t help but notice that their focus on living and enjoying their time, instead of working and making more money, has a meaningful impact on the quality of their lives.

For each of us and our clients, the balance lies somewhere in between. Our job is to help our clients live at their ideal place on that spectrum of trade-offs.

[1] https://www.pnas.org/content/114/32/8523

 

With Compliments to Marie Kondo …

This blog is based on one that I read recently from a US blog site Sightings Over 60 which is always an interesting read.

The Netflix show “Tidying Up with Marie Kondo” has become a phenomenon. Kondo has been around for a while. Her book The Life Changing Magic of Tidying Up was released in 2014 and climbed the bestseller lists. She followed that book with Spark Joy, which tells us, according to the New York Times, that “you can own as much or as little as you like, as long as every possession brings you true joy.”

To be honest, I have not read her books, nor have I seen her show, but having had the opportunity to declutter when moving to a new house, one thing I do know is that decluttering is not a one-time event; it’s an ongoing process.

If you are retired and the kids have left home it is highly likely that you no longer need all that stuff filling up the garage, loft and wardrobes.  Yet decluttering can be a big job with one rule of thumb suggesting that you allow an eight-hour day of decluttering for each year you’ve lived in your house!  But unless you want a bad back and sore knees, you probably shouldn’t try to do it all at once.

So, here are some steps you can take to declutter … with a nod to Marie Kondo for making cleaning up cool.

  1. Warn your children. If the children have left home, invite them to look through your house and take what they want. Then insist that they remove any and all of their own materials – the boxes of old school items, the stuffed animals, trophies from sports tournaments, souvenirs from holidays, etc..
  2. Have a heart-to-heart with your spouse. Most relationships, it seems, consist of one hoarder and one simplifier. To avoid working at cross purposes, you need to sit down and talk things through – so one person isn’t throwing something away while the other is retrieving things out of the bin. The hoarder must realise that many things — VHS tapes, a record player, old sports equipment — are outdated or can be easily replaced. The simplifier must admit that some things have sentimental value and can’t be replaced. So, let’s not be like the dysfunctional politicians. We need to realise that there can be emotional issues involved in the process … and be ready to compromise
  3. Sort one space at a time. It’s easy to get bogged down if you do a little of this, and a little of that. So start small. Clean out a wardrobe, then a bathroom, then one of the kid’s bedrooms. The hardest jobs will be your own bedroom, the loft, and the kitchen.
  4. Touch something once; make a decision. As you go through your old clothes, old books, or old furniture, for each item decide whether you need to keep it or get rid of it. The key to making progress is to make the decision. If you need one suit, then decide which one to keep and get rid of the others. Try not to hmm and ah, change your mind, or postpone the decision – or that one day per year could turn out to be two or three days per year. Or, the decluttering may never get done.
  5. Make five piles. Keep. Sell. Gift. Recycle. Bin. Decide what you want to keep and put that in one pile. The rest goes into one of the other four piles. But try to decide right away – you can give it to someone; you can sell it, recycle it or throw it away. But don’t waste too much time deciding – just choose a pile. If you make a “mistake” and throw away something that maybe you could sell or give to charity – be realistic, you probably wouldn’t have sold it for much money anyway, and the charity wouldn’t have either.
  6. Take pictures. The hardest decision are the emotional ones. But if you can’t bear to get rid of something you need to get rid of, then take a picture. The special dress? Put it on, take a picture, then give it away. The shelf of trophies, the wonderful old oriental rug that will never fit into your new place – take a picture and keep it with you always.  Then make sure to send copies of those photos to your kids.
  7. Books. Marie Kondo has caught some flak for suggesting we keep no more than 30 books in our homes. My own opinion is that books are like albums and CDs, or tapes and DVDs. Keep them around, if they bring you “joy.” But it’s not the books themselves that are important. It’s what’s inside — the information, the characters, the stories and those are all readily available from the library or the internet.
  8. Hire a professional. For most people, decluttering is a do-it-yourself project – and they would have it no other way – perhaps with some help from kids or a best friend. But sometimes the job might just be too big; or you’re too overwhelmed by the prospect. There are professionals who will help you.

So, here’s to many ‘happy hours’ decluttering … or at least planning to.

Is there a better alternative to Inheritance Tax?

Inheritance Tax is enormously unpopular to say the least. A YouGov poll found that 59% of the public deemed it unfair, making it the least popular of Britain’s 11 major taxes. What’s more, the tax has a limited revenue raising ability, with the ‘well advised’ often using gifts, trusts, business property relief and agricultural relief to avoid paying so much.

As it stands, the tax affects just 4% of British estates and contributes only 77p of every £100 of total taxation. This puts the tax in the awkward position of being both highly unpopular and raising very little revenue. Currently the inheritance tax threshold stands at £325,000 per person. Anything above this is subject to a 40% tax (unless you leave everything above the threshold to your spouse, civil partner or charity).

If you own your own home and are leaving it your children (including adopted, foster or stepchildren) or grandchildren and your estate is worth less than £2 million, this can lift the threshold by an additional £125,000 in the 2018-19 tax year (the nil-rate band), to £450,000.

Inheritance Tax is seen as unfair for several reasons, the main one being because it is a tax on giving (while normal taxes apply to earnings) and it is a ‘double tax’ on people who have already earned – and been taxed on – their wealth.

In its report¹ dated May 2018 , The Resolution Foundation; a prominent independent think tank, set out an alternative. They proposed abolishing Inheritance Tax and replacing it with a Lifetime Receipts Tax.

This would see individuals given a Lifetime Receipts Allowance which would allow them to receive tax free gifts through their lifetime up to a set threshold. They would then have to pay tax on any gifts they received that exceeded this threshold. The thinktank suggests that by setting a lifetime limit of £125,000 and then applying tax at 20% up to £500,000 and 30% after that, this would be both a fairer system and harder to avoid. It would also encourage individuals to spread their wealth wider.

They predict that a lifetime receipts tax would raise an extra £5 billion by 2021, bringing in £11 billion rather than the £6 billion inheritance tax currently raises. In a time of mounting pressure on public services like the NHS, this additional revenue would be welcomed by many.

The Lifetime Receipts Allowance would also remove many of the current ways of managing the amount of assets an individual is taxed on upon death. For instance, people would not be able to reduce the size of their taxable estate by giving away liquid assets seven years prior to their death.

The Resolution Foundation also suggests tightening up on existing reliefs such as Business Property Relief, Agricultural Relief, the treatment of inherited pensions and the forgiveness of Capital Gains Tax at death to reduce the scope for tax avoidance.

The Lifetime Receipts Tax is only a think tank recommendation and is not being considered by the government but for the reasons stated … it could have legs.

¹https://www.resolutionfoundation.org/app/uploads/2018/05/IC-inheritance-tax.pdf 

Warning
The information provided is based upon the authors understanding of taxation and legislation at the time of writing.  Any level and bases of, and reliefs from taxation are subject to change.

10 Things That are Good for Us

I read various blogs and articles over the weekend and one grabbed my attention, so I thought I would share some of the content with you … and add a little of my own.

Most days (and particularly at this time of year) the media can confuse us with information about activities, foods, drinks, supplements and other things that are supposedly good or bad for us.  The article I read focused on the following things that are good for us – 

  1. Breakfast. Many people skip breakfast (I am not one of them as Nicky, my partner, will testify). A good breakfast gives you energy and keeps you away from the mid-morning biscuit(s). Eating breakfast is associated with maintain a healthy weight, reducing the risk of heart disease and diabetes, and better concentration and memory. 
  1. Saunas and hot tubs. I have often toyed with the idea of having a sauna installed at home as they can make you feel good and apparently there are health benefits as well. According to the Mayo Clinic, they can improve cardiovascular function and lower blood pressure and relieve symptoms of arthritis, headache and flu.
  1. Organic foods. I know that many of us are sceptical about the benefits of organic food, (especially me as a short-armed Yorkshireman) and particularly because they are more expensive. Science says that organic food, despite the price, are better for you as have more nutrients, less toxins and fewer pesticides.
  1. A sceptical attitude. Now I thought I would score high here, but I maybe verging on being more cynical than sceptical. However, as part of the ‘me’ going forwards I will look at the facts and evidence before believing in something. Sceptics are less likely to fall for the next best thing be it a fad diet, trendy quick fix or cure all. They are also less likely to believe that everything will work out fine and so they take measures to improve their outlook for the future by exercising, eating properly, driving safely and avoiding health risks.
  1. Physical contact. Being physically close, holding hands and giving backrubs all tend to reduce physical pain and this is not something the ladies have simply dreamt up. It was in fact the conclusion from research undertaken by the University of Colorado Boulder whereby 22 couples took part. The women were subjected to mild pain (I guess this would have been equivalent to extreme pain for a man), first when they were holding hands and then when they were sitting together but not touching. The women reported significantly less pain when they were holding hands but not when they were sitting together.  Maybe we could give that a try at the Manchester United matches ….
  1. Herbs and spices. This is definitely something I firmly agree with – any excuse to eat a good curry. Herbs and spices are full of healthy compounds that reduce inflammation and additional flavours that lead us to use less sugar salt and fat in our foods. There is a long list of benefits but here are a few of my favourites (note the curry theme again). Chilli’s boost metabolism and keep blood vessels healthy. Cumin can help weight loss, Cinnamon can help reduce inflammation. Garlic reduces cholesterol and blood pressure. Turmeric may improve memory and help ease pain.
  1. Move. I heard a doctor use the phrase “motion is the best lotion”. It is important to exercise and I’m sure we all know the benefits, so no need for to expand on this one.
  1. Passion and purpose. It is hugely beneficial to have an interest and a passion for things such as a pastime, voluntary work or even continuing to work. We have found that those who fill their time with their passions tend to lead a more fulfilling and healthy life.
  1. Coffee… and tea. Coffee perks you up and tea helps you relax according to WebMD. Coffee may help stave off Alzheimer’s and Parkinson’s, diabetes and liver disease and the recurrence of colon cancer and tea boosts the immune system, lowers blood pressure and cholesterol.
  1. Sleep. According to a study from Northwestern University, people who are night owls are at risk of developing health problems, including diabetes and neurological disorders. But it seems the crux of the issue is sleep deprivation, which affects not just your physical well-being, but cognitive performance as well. But don’t be complacent if you sleep a lot; sleeping too much is associated with the same health risks as sleeping too little. So how much is the right amount? Apparently somewhere between 7 – 9 hours is about right.

So, if you agree with the experts on things that are good for us, here we have an ‘ideal’ healthy day: –

Wake up with a sceptical attitude, have a healthy organic breakfast with a coffee then off to work or to follow your passion.  Return home, enjoy a cuddle or go for a walk holding hands, followed by a sauna or sit in a hot tub with a cup of tea. Then feast on an organic curry, spend time doing something you enjoy before retiring to bed at a reasonable time.

 

 

Merry Christmas

We would like to wish you all a very Merry Christmas and a Happy New Year and also thank you for your support over the last 12 months.

The office will close at 5pm on  Friday 21st December 2018 and will re-open at 9am on Wednesday 3rd January 2019.

As in previous years, in lieu of sending Christmas cards, this year we have donated to Shelter UK and Alzheimer’s Society

 

The Return of the Rise in Probate Fees

Back in 2017 we covered the proposed rise in probate fees which was subsequently abandoned when the general election was called.  The current probate fee is a flat fee of £215 or £155 if the probate application is made via a solicitor.

In November 2018, the Government brought before Parliament proposed legislation which if approved, will introduce a new banded structure of fees, tiered according to the size of the deceased’s estate as set out below: –

·         Up to £50,000:                        no charge

·         £50,000- £300,000:                  £250

·         £300,000- £500,000:               £750

·         £500,000 to £1m:                    £2,500

·         £1m to £1.6m:                         £4,000

·         £1.6m- £2m:                             £5,000

·         Above £2m:                              £6,000.

Whilst there are significant increases for the larger estates, (although not up to as much as the £20,000 previously proposed), it is estimated that 80% of estates will not pay more than £750 and fewer estates will be liable because the probate fee threshold will rise from £5,000 to £50,000 which should exempt about 25,000 estates every year. The additional income raised, estimated to be £145m, is to be invested in the Courts and Tribunal Service and will be used to fund improvements to the Probate Service. This includes the ability to apply for a grant of probate online. Interestingly, a separate statutory instrument has been issued to introduce this online application process and will lead to an administrative cost per application of only £9.30.

However, as the probate process is broadly similar regardless of the size of the estate, it could be argued that the new fees represent a stealth tax on property as property is normally the main constituent of the estate. Indeed, a House of Lords committee has reiterated this and is concerned that the proposals will lead to a move away from ‘the principle that fees for a public service should recover the cost of providing it and no more’. Executors may find themselves having to find the required fees themselves where estates are relatively illiquid, while professional executors may raise their fees to cover this.

Charities will also be adversely affected as they are not exempt from probate fees. It is estimated that they could lose about £10m a year of legacy income and so there will be lobbying for a relevant exemption to be introduced.

The Government are hoping to have the legislation through Parliament by April next year and if it is agreed, it will clearly be important to ensure that funds are available to your executors to pay the fees.  This can be easier said than done and particularly as these have to be paid before any of the assets can be distributed.  This is something that we can discuss during our meetings and incorporate into your financial plan.