Can your money work harder in 2020?

Can your money work harder in 2020

Now could be the perfect time to consider whether your savings, investments and pensions are working as hard for you as they could with three resolutions for the New Year.

  1. Pay Less tax

Less tax means higher returns for you.  You could pay less tax with a carefully constructed financial plan and by making the most of your tax allowances.

  1. Seek better returns with investment choices tailored to you

Much has happened in 2019 and your investments may look different from a year ago. You could now be taking too much risk, or holding poor-performing investments.  Independent Investment Advice can help you make sure your investments are positioned to seek the best returns for your financial goals.

  1. Make it easier for yourself

With a bit of help you can make your investments easier to look after and reduce your paperwork.  This New Year could be an excellent time to bring all your pensions, ISA’s and investments together. Saving you time, effort and paperwork.  We recommend you seek independent financial advice before moving any type of pension plan or investment product.

The New Year is always a good time to seek advice to improve potential returns and to pay less tax.  We can help you do this.

Contact us today on 01384 671947 for advice.

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The value of investments can fall as well as rise, and you may not get back as much as you put in. Please note tax rules may change.and benefits depend on individual circumstances.


Pension Freedoms 4 years on

Pension Freedoms 4 years on

The Government’s announcement of Pension Freedoms in 2014 came into play from the start of the 2015/16 tax year, promising “freedom and choice in pensions”. It has now been four years since the new rulings took effect, yet many people approaching retirement age are still none the wiser as to the key features.

Let’s remind ourselves of the key elements, with a focus on what it means for your finances.

The Pension Freedoms Plan

The introduction of the new plans in 2015 allows people aged 55 and over to take out their private pensions as a single lump sum, removing the previous limit of 25%, although anything over the initial 25% will be hit by tax which could put you into a higher tax rate bracket..

Individuals essentially have a number of options at their disposal:

  1. Leave funds in the pension, as is the default position until you wish to start taking payments.
  1. Withdraw the full sum of money from the private pension, although not recommended in nearly all cases. (25% tax-free; 75% taxed).
  1. Withdraw lump sums equalling a percentage of the overall funds, leaving the leftovers in the pension fund.
  1. Take the tax-free 25% and then buy an annuity to gain a monthly income for the rest of your life.
  1. Take the tax-free 25% and then buy a drawdown product, giving you a monthly income and the flexibility to keep withdrawing lump sums if required.
  1. A combination of an annuity to secure guaranteed income alongside the flexibility of withdrawals

A recent market study by our regulator, The Financial Conduct Authority estimated that 100,000 people use the fifth option without seeking advice and is costing consumers up to £25m in missed pension income each year. Moreover, pension freedoms can lead to the unnecessary tax being paid and being caught up with other rules, such as the Money Purchase Annual Allowance which can limit your contributions to £4k a year, rather than the annual allowance currently £40k.

As such, it is highly advised that you speak to an expert before making any decisions on how to utilise your pension.

New Rulings From 2019

While the increased flexibility has provided additional options, the teething problems of missed pension income have been further exacerbated by the fact that many have focused on the short-term by taking lump sums, essentially putting their long-term financial stability in jeopardy.

As a result, the Financial Conduct Authority (FCA) is to usher in some amendments in November 2019. These planned changes are designed to make things a lot clearer for individuals.

Firstly, consumers will receive “wake up packs” every five years (starting at age 50) until their pension has been entirely cashed. This will include a summary, risk warning, and basic guidance. Secondly, pension firms will have to look into enhanced annuities to see whether clients are eligible. This must be supported by a market-leading quote based on their individual circumstances.

Further ideas are being trialed with a view to making them available in 2020. This includes a requirement for pension firms to provide clear information regarding payments and fees, as well as insight into potential investment pathways.

It is important to note that a pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.

The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation, and regulation which are subject to change in the future.

Given the pending changes, now is the perfect time to seek further advice from a financial adviser. The health of your future finances may depend on it.

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The Pro’s and Con’s of buying an Annuity

The Pro’s and Con’s of buying an Annuity

Protecting your financial health with the right retirement plan is a responsibility that nobody can afford to ignore. The decisions revolving around your pension are undoubtedly among the most important of all, and an annuity is one of the options that you’ve probably heard about.

Before rushing into a decision one way or another, it’s imperative that you understand the potential benefits and drawbacks – not least because it is often not possible to undo your decision. Here’s all you need to know.

 Annuities At A Glance

In essence, an annuity is an agreement in which you trade your pension (or at least a part of it) for a guaranteed income that will last throughout retirement until the day you die, regardless of what age that happens.

Annuities are a form of insurance, then, and are used by many people throughout their retirement years.

 Annuities: The Pros & Cons

Like most financial products, there are a number of pros and cons to consider before taking out an annuity agreement. Let’s take a look at both below.

The Pros

First and foremost, the annuity arrangement means that your income is guaranteed for life. This means that you’ll have money entering your pocket even if you live for 20 or 30 years after the annuity payments start. This in itself is extremely reassuring.

Annuity agreements offer flexible options, including the choice between flat payments and increasing payments. The latter option gives you the best chance of staying ahead of inflation and increased living costs, resulting in the same level of buying power at all times, albeit starting at a lower initial income.

It is also possible to pay a lump sum and start taking monthly payments right away, or defer the payments until a later date (such as after you retire). Some of the agreements also allow you to defer payments to a loved one should you pass – albeit only or a set amount of time.

If you have health problems, you could receive a higher level of income. This is because of the provider will look at life expectancy

The Cons

Annuities can be quite complex and difficult to understand. Nobody should take a financial product that they do not understand.

Annuities do not allow you to change the payment terms, even if your situation changes, which can tie you into financially suffocating agreements.

Annuity providers offer different rates of payments, so it is important to shop around. Depending on investment performance and longevity, an Annuity may not offer the best deal when it comes to the total income it pays out. When you (or your spouse if joint income is selected) dies the annuity dies with you.

Is An Annuity Agreement Right For You?

As with most financial products, there is no single right or wrong answer. As long as you consider what’s most important to you, finding the right option shouldn’t be too difficult. But if you do still require some help, our experts are only a call away.

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How to Create the Perfect Retirement Plan

How To Create The Perfect Retirement Plan

Retirement, for many, is a chance to continue doing the things they love most, from following their favourite football team across Europe to getting away from the British weather for a winter in the sun. However, waiting until you’re 67 to step away from the working world entirely can feel like a long time away. It’s for this reason why many are looking into retiring early, on a plan which ensures they don’t have to give up any aspect of their current lifestyle.

Unfortunately, retiring on your own terms is expensive, especially if you want to enjoy the comforts and luxuries you’ve had since you first started to earn a wage. What’s more, your retirement is going to last a significant number of years, so preparing in advance for these years is crucial. How do you create the perfect retirement plan, however?

How Much Do You Have?

The average employee who has been working for several years will have a pension pot building up. All employers must provide workers with a workplace pension scheme, which employees are then automatically enrolled in. You are automatically enrolled if you meet the following criteria:

  • Aged between 22 and the state pension age – in 2019, the state pension age for both men and women is 66. However, it is going to increase further to 67 by 2026.
  • Earn at least £10,000
  • Classed as a ‘worker’
  • Work within the UK

How much you have within this pension pot will depend on a variety of factors, including what type of scheme you’re enrolled in, how much both you and your employer pay in, and the tax relief the government has added to your workplace pension.

The current minimum contribution limits are 5% for you as the employee and 3% for the employer.  That is a maximum of 8%.  Tax relief is also available in most situations reducing which makes up part of your 5% contribution thus reducing the amount you actually pay.

To work out how much pension you have to play with in retirement, you first need to discover how much is in your savings already. Once a year, your pension provider should send you a statement. However, you can also choose to check the amount online, should your provider allow you to track it via their website.

You can also check your State Pension online, using the website. You can then accurately see how much you have for your pension.

How Much Do You Need?

Once you’re aware of how much pension you have, you need to work out how much you need.

How much do you predict your winter away in the sun will cost? How much, on average, is a season ticket for your favourite football team?

Also add into this amount the monthly outgoings you will still have: mortgage repayments, utility bills, and other lifestyle factors.

How To Achieve The Money You Need

Savings are the best way to build your pension pot up, but you need to be saving in the right places. Therefore, it’s highly crucial you find the best pension scheme for you and your savings. Of course, if you have the opportunity to pay more into your pension, it’s recommended you do so, as this is one key way to increase your amount.

Alternatively, you can choose to switch your pension from the government-backed workplace scheme to a private scheme. A private scheme may offer you higher interest on the money you pay, therefore, enabling you to withdraw a higher amount when you choose to.

Why A Pension Is The Best Plan

A pension plan is the best solution for ensuring you have the funds available to enjoy your lifestyle for the rest of your life. While employers now have a commitment to providing a workplace pension, if you’re not automatically enrolled, it’s imperative that you do so as soon as possible. There are several reasons why a pension is a wise move, including:

  • A pension is tax efficient. What this means is for every £1 an employee pays into a pension scheme, the tax man will you give 25p. When you’re ready to withdraw your pension, 25% is tax-free. If you accrue £100,000 in your pension pot, £25,000 is tax-free.
  • Today’s pensions are highly flexible. Long gone are the days where you had to buy a monthly annuity pension from an insurance company. Now you can draw as little or as much as you’d like out of your pension after the age of 55.
  • Your pension can be passed onto your loved ones in the wake of your passing. You can even leave it as a lump sum, so you know your family is looked after when you’ve gone.

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected the interest rates at the time you take your benefits. Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.

Contact us to start your retirement plan.

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The Benefits of Saving Regularly

The Benefits Of Saving Regularly

There are often two types of investors. There are investors who already had money in their pocket, and now wish help to invest it somewhere. Alternatively, there are investors who didn’t have any money beforehand, but now they do, they want to build up their pot of money.

While both investors are aware of the benefits of saving, not many understand the benefits of saving regularly. What’s more, many investors don’t fully appreciate the benefits of committing to saving regularly.

The Benefits

Committed Savings:

By committing to saving regularly, perhaps a set amount every pay check, you are much more likely to build up your money, rather than spending it. Unfortunately, some saving accounts are easy to access, meaning the temptation to dip into them should you wish to can be tricky to avoid.

Stock Market:

As you’re not investing your money into the market at a single point, it removes the risk of getting the timing just right. However, using the stock market for your regular savings applies to those wishing to save for the medium and long term.

The ups and downs of the stock market are one reason why investors are afraid of it. However, the approach is known as ‘pound cost averaging’ is one to consider. Pound cost averaging is the approach of investing small amounts very regularly.

As the name suggests, it is the cost you spend buying stocks which average out over time. It helps an investor instill good behavior because you’re establishing a routine. This routine enables investors to consider the stock market as an ongoing activity, rather than one which relies solely on gain or is affected by a temporary loss.

How to Save:

For those wishing to save for the long term, choosing to save regularly is highly effective. You first need to assess why you’re saving. Often, savers decide to put money aside for their children, which may start from the moment their child is born until they leave for university at 18.

Tax Efficient:

Whatever your saving goals are, there is a variety of ways to achieve it. One such way is an ISA. An ISA is an Individual Savings Account, which offers tax-free interest payments. It means, by choosing this, you could get more for your money. However, there are limits, known as an ‘ISA allowance.’ This currently stands at £20,000 per annum

If you’re saving for a medium (5-10 years) or long-term goal (10+ years), choosing stocks and shares ISA could prove more beneficial.   A stocks and shares ISA is very different from a typical cash ISA.  Rather than merely paying money in, you’re investing in assets that have greater potential for growth compared to a cash isa account. Although cash ISAs are relatively secure, investing in stocks and shares does have varying degrees of risk associated with them.


Saving regularly can be the difference between affording the lifestyle you want, and not. A great example is the retiree who bought a Mercedes 2-seater sports car after leaving the world of work behind for the last time. How did he manage to do this? Simply by committing to saving a regular amount each month into a stock market investment unit trust. It took 20 years to achieve this goal, but by ensuring he didn’t miss a single payment, he could treat himself in cash to the car of his dreams. This is what long-term saving is about: enabling you to afford the luxuries you want after you’ve worked so hard all your life.

TKV Financial Management can advise you on the best saving plan for your situation. Contact us to arrange a meeting.

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What Are The Benefits of Financial Planning?

What are the benefits of Financial Planning?

Have you ever thought about financial planning? Creating a financial plan for yourself should be essential, and more people need to start doing it. Contrary to what you might imagine, it’s not just a case of creating a weekly budget and restricting your spending.

With proper financial planning, you can see your short and long term financial goals, which helps you develop a plan to ensure you achieve them.

As such, here are the main benefits that financial planning will bring to your life:

Become more tax efficient

Being tax efficient means that you only spend as much money on tax as you need. With financial planning, you will lower your tax expenditure and limit the cash leaving your accounts.

This is done by looking for tax-efficient investment options that ensure you aren’t paying income tax on certain earnings – like ISAs. By being more tax efficient, it ultimately allows you to keep more of the money that you earn every year.

Manage your income to save more money

One of the vital benefits of a financial plan is that it lets you get more out of your income. You can manage the money you make and understand how much of it needs to go on essential payments.

This provides you with an insight into how much money is left over to put in savings accounts or investments. As such, you waste less money, save more, and start living a more comfortable life.

Be more financially stable

Following on from the point above, putting together a financial plan will enable you to be more financially stable. Your plan should include introducing regular and consistent savings, placed into a savings account each month and by doing so will ensure that you always have these funds to fall back on if ever you need them, and this could be as a reward each year of a nice holiday or indeed should an emergency arise at any time then these savings will cushion the impact and enable you to avoid falling into debt.

Reach your specific goals

It was mentioned in the introduction, and the whole purpose of financial planning is to help you achieve specific financial goals. If you’re hoping to save up for a new car or house, then it’s crucial to have a financial plan in place that allows you to reach this aim in as little time as possible.

If you’ve got a more personal goal of earning a specific amount of money through investments, financial planning creates an environment where you will achieve this. Plans are tailored to each individual based on your long and short-term goals. If there’s something you want to aim for – financially speaking – then you need a plan to create the framework for you to follow.

There’s no denying that financial planning presents some very impressive benefits. Anyone that wants to gain control of their finances and make the most out of their money needs to consider it.

Consulting with financial advisors and developing a financial plan will help you achieve stability and security. It’s an excellent way to help improve your current financial situation while also setting you up for a stronger future as well.

Levels of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.

If you are looking for an Independent Financial Advisor, please do get in touch.

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What Is Estate Planning?

Estate Planning

Whether you realise it or not, you have an estate. Lots of people are unaware of what makes up an estate, and therefore are under the impression that they don’t have one. However, most people do in fact have one even if it is a small one. Have you ever heard of estate planning? If not that’s okay, because we are going to be discussing it down below.

What Is An Estate?

An estate is made up of everything you own. This could be a house, any sort of real estate, a car, personal possessions, any investments, life insurance policies and so on. There are a number of contributing factors that all add up to make your estate and whether it is large or small, it still exists.

What Is Estate Planning?

To put it simply, it is planning for what happens once you die. After you pass away, you want to know that all of your stuff is being passed on to those who you love. Each person gets what you have decided, and you need to make it clear who gets what of your estate. After reading this explanation of estate planning, this might be ringing a bell in your mind that you have heard this before. That is because many people talk about this through their life, what happens to their items when they are no longer around. If you want to have some control over what happens to your estate, it is vital that you start your estate planning soon.

Who Needs Estate Planning?

Everyone. Too many people think that this is only for people who are in their elder years, or in their retirement stage. You never know when your time is going to come, and you need to have planned for it no matter what age you are. It is also the case that you should be estate planning even if you only have a small estate. It is important that you have a plan in place for your death and that is why as soon as you have something to give, you should start your estate planning process.

What Does Estate Planning Include?

Your house, your car, your savings, your investments, your personal items and everything like this all needs to be taken into consideration. But, this is not the extent of it. You also need to be leaving instructions for cases such as care for if you become disabled, an inheritance manager if younger children are involved and a life insurance policy to take care of your loved ones. Further still, you need to consider looking after people in the long term, especially those who are not very good with money.

This should be changed and updated constantly depending on how your relationships and your health evolve. This should not be a one-time thing that you do and then forget about, it should be a process.

We hope that you have found this article helpful, and now have a better understanding of what estate planning is and why you need it.

The Financial Conduct Authority does not regulate Estate Planning.

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What Is A Pension Review?

Pension Review

Are you starting to prepare for your retirement? You may wish to complete a pension review. A pension review is typically an essential part of retirement planning and allows you to make sure that you will be secure financially when you lose your permanent income.

What Is A Pension Review?

Simply put, a pension review is a way to check how well your pension is performing. Is it generating the level of finances that you had hoped it would and are you on track for the level of pension you wanted by the time you retire?

Pension reviews can include various different pieces of information including:

  • Total annual fee
  • Level of growth
  • Type of investments
  • Ability to provide the right retirement

As you can see, a pension review will essentially show you whether changes need to be made during the pension planning stage. For instance, if the type of investments that you are currently using is not providing the level of growth that you need, then it may be worth looking at different investment options that could generate better results.

Who Completes A Pension Review?

A pension review can either be completed by an individual or a company working for an individual. Ultimately, this will be to make sure that the pension is providing the benefits that they require.

What Can You Learn from a Pension Review?

You can learn a lot from a pension review. The best and simplest way to look at this is through an example. Remember, you can start a pension review at any age, assuming you are already planning your pension. For instance, someone at thirty could theoretically conduct a review. This would provide them with a great start for their pension.

They might find that their annual fees are quite low and that they are currently involved with low-risk investments. However, by moving to high-risk investments, they would have lower annual fees. There could also be a good chance that the funds would grow at a faster rate too.

I had a private pension not working for me and an old works pension that was frozen. Tim put them both together and got them working for me. It is working well, just wish I met Tim 20 years ago. He is doing a great job. Tim has been my adviser for 4 years and my pension has increased by almost 50%. Thanks Tim.    Janice P, Birmingham – Client Since 2015

A pension review does not mean that you have to make these changes. It simply provides you or the company with all the information so that an informed decision can be made

Other Benefits of a Pension Review

There are various benefits of a pension review that you should keep in mind. First, you might have your pension spread across several different plans. With a pension review, you can begin the process of transferring all your pensions to a single provider. This will mean that keeping track of your pension and your finances will be easier. You’ll be able to see more clearly whether your pension is on target.

You might also find that your current pension plan is simply outdated and not in line with the economy of today. With a pension review you or the company can work to change your pension and ensure that it provides the benefits that you need. Ultimately, you can make sure that it is performing at the level you want or at least, increase the chances that it will.

If you would like an Independent Financial Advisor to do a pension review for you, please do get in contact with us through our contact page. 

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.

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How Does Investment Planning Work?

Investment Planning

If you are keen to protect the health of your finances, you need to think in terms of investment planning. Investment planning is an essential part of financial planning. Indeed, it is near impossible to have one without the other. Let’s look at what this is and why it is important.

What Is Investment Planning?

This is the basic process of matching financial objectives and indeed goals with the resources you have. It takes into account your budget and the levels of finance that you have to put towards potential investments. It will typically be completed with a financial planner who will help you lay out your finances correctly to reach your expectations.

To begin with investment planning, you first must formulate your unique set of goals and objectives. Only then you will be able to make sure that you can match your resources to these.

Once you have laid out your objectives, you can then start to look at the different investments available to you. There are various types of investments to consider including property, bonds, equities and of course cash.

Each individual investment option has different characteristics. An investment plan will ensure that these characteristics are always taken into consideration before you move forward.

How Does Investment Planning Work?

When you communicate with a financial planner, they will help you match the investments available to your goals and also your resources. Be aware that as your circumstances change, so to could the essential elements of your financial plan. Investment planning will also usually ensure that you are meeting standard regulations that could be relevant to your individual choices.

Benefits And Goals of Investment Planning

The ultimate goal of investment planning is to make sure that you do gain financial rewards and a solid ROI from every investment. However, investment planning also provides numerous other benefits that you should not dismiss.

For instance, with investment planning, you can gain access to an increased cash flow. Investment planning will typically involve monitoring all expenses as well as spending planning. It will ensure that you are budgeting correctly and not overspending in any areas. As well as this, you will also be managing your income. You will have a greater understanding of exactly how much needs to be used for tax payments and manage monthly or even annual expenditures far more effectively.

Investment planning can also ensure a higher quality of life and standard of living. You will be successful saving and investing money in the right areas. This will provide you with financial safety if, for instance, the economy suffers a downturn. You will have various incomes that you will be able to fall back on. You will also be guided on the right investments that will provide the greatest benefits to your financial wellbeing.

Investment planning is typically not a one-day solution. Instead, you will gain a relationship with a financial advisor and constantly be provided with the expertise you need to make the right decisions with your investments. You will also be able to create and develop a full plan customised specifically to suit your requirements.

if you are looking for help with investment planning, please do get in touch by using our contact page

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

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What does an Independent Financial Adviser Do?

What does an Independent Financial Adviser Do

Financial advice can be invaluable. With the right financial advice, you can decide how to manage your money and fulfill your goals, whether you’re trying to save, invest or even decide how to spend your money. You might be unsure about whether you should be using a financial adviser or even what a financial adviser does. An independent financial adviser can give you advice across a range of products, with no attachment to any particular bank or financial institution. If you’re looking into financial planning, you’re thinking about how to afford retirement or perhaps you want to make arrangements for your estate, a financial adviser can help you.

When to Use a Financial Adviser

There are many times in life when you can benefit from the help of a financial adviser. A financial adviser can help you to make financial decisions both big and small so that you can manage your money and get more from it. Some things that you might want to use a financial adviser for include:

  • Financial planning – creating a financial plan for the future to make the most of your money
  • Pension advice – get the right advice to choose or change your pension and prepare for retirement
  • Investment planning – receive help on making the best investment decisions for your financial goals
  • Estate planning – preparing your finances for after your death to protect your family and more

Independent Advice

When you work with an independent financial adviser, you get independent advice, as the name suggests. Other financial advisers may be restricted, meaning that they can only offer you advice on a limited selection of financial products. Some might be restricted to certain products, while some might only be able to recommend products from a particular provider. An independent financial adviser can help you with anything and everything.

Save Time and Money

Using an independent financial adviser delivers several benefits. You could save yourself a lot of time, money and headaches by getting professional advice from someone who can understand and help you to reach your financial goals. Choosing financial products and financial planning can get complicated and confusing. Even if you are well-versed in financial matters, you can find it difficult to use your head and not let your emotions drive your decisions. Independent financial advisers not only offer advice independent of any financial providers, but they also help to give you an objective opinion on your financial decisions.

Different Ways to Receive Financial Advice

There are different ways that you might receive financial advice from an independent financial adviser. Some advisers will meet with you in person, while others provide advice over the phone or even via email. You can also receive a report of your current financial situation with advice for actions that you can take. Before you choose which financial adviser is for you, make sure you check how you will receive their advice.

Taking advantage of the services offered by an independent financial adviser will help you to plan your finances for a brighter future.

If you are looking to use a financial advisor, please do contact us through our website, email or call 01384 671947.

Investments carry risk. The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. The Financial Conduct Authority does not regulate Estate Planning.

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