Autumn
Newsletter
2011 We take your worries away so you can sleep at night in comfort. Asset & Investment Management Ltd 4 St Johns Mews, 13 St Johns Road, Hampton Wick, KT1 4AN Authorised and regulated by the Financial Services Authority
“Expect Excellence..” t. 0208 943 4343 e. office@aimifa.com w. www.aimifa.com
Autumn Newsletter 2011
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Retail Distribution Review (RDR) - Changes to the way you receive and pay for advice This Retail Distribution Review (RDR) will be implemented January 2013 and requires Financial Advisors to charge clients for advice.
Fees and Commission
As a result, the new rules will alter both the information you receive from us and the way in which our advice is paid for.
Our industry has been based on a remuneration structure whereby commission is paid directly from the provider to the adviser. However the new rules require Financial Advisers to provide specific details of the service we offer you and the details of the fees involved in advance. Many of you will be familiar with how this works already, however full explanation for your situation will be discussed with you personally, early in the New Year.
Complete independence
The benefits for you
Asset & Investment Management Ltd will under this Review be classified as ‘independent’. As such we will be required to provide unbiased, whole of market advice on your financial situation. Since we have always provided whole of market advice we will not have to change the manner in which we have previously acted.
We believe we have always provided a fully independent and professional advice service to all our clients and, to an extent, the fact that our business is already run in line with many of these new rules only reinforces that belief.
IT WILL NO LONGER BE POSSIBLE FOR PROVIDERS OF FINANCIAL PRODUCTS TO PAY COMMISSION TO FINANCIAL ADVISORS.
Welcome Stewart
Qualifications
We are delighted to announce that Stewart Twidle has joined Asset & Investment Management Ltd as a Financial Adviser. Stewart is fully qualified to give financial advice under the rules set by the Financial Services Authority and will therefore be offering you In future the FSA will audit the activities of all Fiadvice on a multitude of financial nancial Advisors to ensure they are partaking in a planning matters. Stewart has programme of continued professional developworked in financial services for 5 ment as to ensure that Advisors can demonstrate years, looking after the clients of a in-depth knowledge of every aspect of the financial high street Bank. He is now enjoyservices market. Our advisers already meet these ing the freedom of giving advice in broadened criteria. an independent environment. The legislation flowing from the Review brings with it higher minimum standards for the qualifications for all financial advisers. Existing advisers must achieve such standards before they can practice. All our advisers already meet those minimum standards.
Check your tax… and those offering help
Bank of Mum and Dad One of the questions most asked these days is by parents wanting to help their children onto the housing ladder, either because their son’s or daughter’s income is too low to justify the mortgage that they need, or they cannot save enough to find the much higher deposits that are usually required today. Apart from providing your children with cash for the deposit, if their income will not support the mortgage needed, you could consider becoming a joint borrower or a guarantor for their loan. If you want help, don’t be tempted to cut corners, especially if they are buying property jointly with a partner. Make sure you have a robust legal agreement in place to cover what happens if your child and their partner go their separate ways. In particular, if you advance a capital sum, we recommend taking a second charge on the property for the amount lent, to protect you in the event of separation. You could also consider placing a Caution against First Registration as a means to protect your interest in the property. For example, if the child attempted to sell, or rent the property the Cautioner will automatically be informed. The solicitor will then ensure that the Cautioner's interest is dealt with before proceeding with the purchase. Thus the registration of a Caution against First Registration is an effective way of protecting an interest in an unregistered property. As all properties are now compulsorily registered following a purchase, the Caution is always seen and must be dealt with for the purchase to proceed.
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Autumn Newsletter 2011
In the last few months, stories have surfaced with depressing figures about the number of tax codes wrongly calculated by the Revenue. We have experienced the same problem with one of our own staff members, requiring a Tax Code change three times within one year! Whilst some people have benefited from these errors, many more have been faced with large and unexpected tax bills. Whilst pensioners are perhaps the most likely “victims” of these errors, everyone should check their pay slips/pension statements/self-assessed calculations to make sure they are correct. Sadly, once again people are attempting to exploit other people’s problems. Please be aware of fraudsters taking advantage of these errors, usually via e-mails promising to help you obtain a tax refund. These approaches are always a scam. Experts confirm that any initial contact from HMRC will always made by letter.
Why should I get a will? Only three in 10 people in the UK have a will. Last year the Treasury gained £53m from people who died intestate – without a will. The year before it was £76m, and yet the fractured nature of modern families means making a will has never been so important. In families where the parents are unmarried and have children not having a will can have devastating effects. If we take the following example “Steven Travis and Joanna Thompson have lived together in their Brighton home for 10 years. They have a son, they are not married and they have no will. If Steven passes away, Joanna would be left with nothing. The house they shared was originally his, and while they have shared the mortgage for 10 years if he died Joanna would have no claim. All Steve’s assets would be passed directly to his three-year-old son. Leaving Joanna to cope on her own until their son comes of age.” Although completing your will may be thought provoking and sad, having a will makes things a lot easier for your nearest and dearest if you do suddenly die. As soon as it is signed you can put it in a drawer and concentrate on living.
Government pension reforms may leave savers worse off As part of wholesale pension changes, which has also included changes to the state pension and changes to tax relief amongst other reforms, auto-enrolment will impact on every employer in the UK. By 2012 for the biggest companies, and by January 2016 for all existing employers, not only will employers have to offer to pay into a pension scheme for almost all their employees, but they will need to provide information about the scheme, deduct the employee’s contributions and send these to the relevant pension company. The authoritative industry survey by the Association of Consulting Actuaries (ACA), coincides with figures showing that annuity rates have fallen to their lowest ever rate, reducing the income of many pensioners. The ACA survey of 468 employers highlights growing concerns over rules which mean that, from next year, all employees who do not opt out of an occupational pension scheme will automatically be enrolled. The ACA found that 27 per cent of companies are likely to respond to the changes by reducing their pension contributions. Under the rules, employers will pay 3 per cent of salary towards an employee’s scheme; workers pay 3 per cent and the Government a further 1 per cent. Keep an eye out for changes regarding pension schemes within your work place, and do not hesitate to contact us if you have any concerns.
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Content of the articles featured in this Newsletter is for your general information use only and is not intended to address your particular requirements. They should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles.
Asset & Investment Management Ltd 4 St Johns Mews, 13 St Johns Road, Hampton Wick, KT1 4AN Authorised and regulated by the Financial Services Authority
“Expect Excellence..� t. 0208 943 4343 e. office@aimifa.com w. www.aimifa.com