Dear Friend
Well here we are, with a new Government and the most ever Cabinet changes in a sitting party of power for sixty years. Whatever your views on Boris, I have optimism that going forwards, we can expect better things to come and the ‘uncertainties’ gradually being replaced by ‘certainties’. And yes, whilst some will say that his speeches and ‘promises’ are bluster and fluff, I believe it is about time indeed that we did look forward to the future with optimism in terms of what we, a strong and proud Nation, can do and can deliver. Well done Boris – we look forward to real things and our outlook improving and I think too you have placed a strong team around you, there to complement you, challenge you, surpass you and to help deliver your visions.
THE EUROPEAN DREAM
I like and respect our continental neighbours. I enjoy visiting them and relating to them and vice‑versa when they are here. Indeed, I learnt enough French and German to ‘get-by’ and it is almost always a surprise to them that any Brits can speak anything other than English… however badly. That is partly ‘our’ laziness as a Nation but also an arrogance that we expect ‘them’ to speak English.
I remember the vote to join the EEC in 1975. Dad looked forward to the prime objective promoted at the time – the ‘Common Market’. He relished the thought of cheap wines and continental cheeses, etc, coming across the Channel as well as the opportunities for our industry too and all that freer trading relations would bring to us all! Whilst in many ways parochial (and having never been able to afford to travel abroad) he very much enjoyed interactions with visitors from other countries – and having a good relationship with the lady next door of some decades who had also been a member of the Hitler Youth – as had ‘most’ youngsters living in Germany during the war. My Gran, who had lived-through two world wars (though not hateful about that nor against the continental neighbours in any way) was more sceptical and voted ‘No’.
Well, there is a camp which points to the joys of European integration and the premise that ‘it’ is better over there than it is ‘here’ and that we are poor relations because we haven’t engaged as much as we should have done and of course we are now heading for the exit. However, visiting our son Noah in Dusseldorf for a long weekend where he is working a couple of months at The Max‑Planck-Institut für Eisenforschung GmbH (MPIE), a scientific research organisation with close links to Cambridge University, it is interesting to remark on a few things. And yes, we had an enjoyable time thank you!
So what are we ‘suffering’ here and which perhaps we shouldn’t be and how much are they leading the way about caring for the environment and safety as a contingent here is suggesting they are? Well, let me start with wine. Good quality wines in the local Aldi for under £2 a bottle. Yes, quite drinkable wines in your local supermarket here for £5-£6. And what about spirits? Yes, likewise around half the price. Now where is that ‘common market’ I ask (and indeed on that basis it has to be worth thinking about those white van booze trips for personal consumption again, do you remember them!). Hmmm. Diesel, as we have realised with their nasty pollutants for the environment, our children and urban dwellers. So over here, around £1.32 a litre and over there? Yip – despite the collapsed Pound, £1.10 a litre.
There is no apparent plastic straw abolition movement there for their 83million inhabitants. Smoking? Over here it is almost an anti-social pursuit these days but over there – it is a popular and community activity and I suppose quite remarkable to see certain groups of people all socialising together with cigarettes in hand and at any time of the day or night. I am not remarking on this in any way other than the statement of fact – but have the health issues not caught-up with them there yet? Cigarettes are on the normal supermarket shelves, there to be picked-up as you wait at the check-outs – no barriers, no brand-disguising, no protecting from children and the vulnerable there and just a little over half the price of ours. More things to go in the van… however, they are encouraging a proactive deposit scheme for plastic bottle recycling so that is positive and we could do that here.
But they are more health conscious and in favour of regulations to protect their citizens? Well, there are bicycles all over the place (and electric scooters and mopeds), a good sign (but it is very flat too…) but where are the crash helmets for cyclists? They are almost non-existent aside from those doing long trips and despite perhaps the biggest danger being from vehicles. And in the UK we have a problem with homelessness and the fourth largest economy in the world with 45% more economic output than us and only 24% more inhabitants… oh yes, lots of beggars and homeless people over there too and despite a theoretically ‘socialist’ administration – and latest figures suggesting over 1.5million foodbank visits every week.
So let us trust that through the other side of Brexit we begin to enjoy some of the benefits to which we are entitled and start to unravel some of the constraints we have imposed on products as at the end of the day, it is the poorest too who benefit most from some of those changes and reduced prices by cutting taxes (yes, many of which we control ourselves already), even if we don’t want to encourage them into alcoholism or smoking!
SHORTLISTED YET AGAIN – MONEY AGE AWARDS!
Thank you to Money Awards 2019 – we have been short-listed again! Thank you to all our clients for supporting us in our endeavours and thus giving us the ammunition to even be considered at all. We don’t forget your involvement and the support you give to us accordingly – thank you; we appreciate it!
PENSIONER AFFLUENCE
A recent study by Aegon has found that contrary to received wisdom, a fifth of pensioner couples are actually pensioner millionaires! This is one out of every five couples across the whole Country! https://www.aegon.co.uk/news/1_5_of_retired_couplesarepensionermillionaireswhilstthegaptothep.html Yes, there is a growing gap between those who have not made any provision and those who have (and many public sector pensioners swelling the ranks of those with big pensions over the last few years too as almost the ‘only’ ones to still enjoy salary-related pensions) but it is an encouraging sign – and one which means more people should take advice to make sure their money is working properly for them but also to encourage younger employees to make sure they make provision and don’t ignore or defer it.
LIFE INSURANCE
Do you need it? Really, it is a case of recognising the holes which might exist upon your unfortunate demise and securing plugs for that in case the unfortunate arises. Don’t buy too much (despite what insurance salesmen may try to tell you). Remember you have other life insurance – eg the value of your pension fund, possible death-in-service benefits at work, equity in your home or business and investments. Save that part of the premium and invest it instead as you hope life insurance is a waste of money…
We help clients with their needs and sometimes it goes beyond simply finding the cheapest. We have just had a case whereby the insurance company quoted over £400pm for an expensive policy on underwriting conditions but we were able to argue and prove by appropriate questioning that the risk had been over-played and we were able to reduce the cost to £262, a 35% reduction. It’s all part of the service and so is the first part – of stopping you buying something you don’t need!
THE RISK OF PASSIVE FUNDS
Passive funds in the US have now broached 40%. Active funds are still in front for demand and have managed to keep their momentum but more and more money is going into investments simply because ‘they are there’. Is that a good thing? My answer is ‘no’. They have a place but the more money that chases the same things then the higher they become without any underlying reasoning and rationale. With an active manager, you are also paying for something you will never receive with a ‘passive’. He may just choose to increase his defensive positions when he thinks things are toppy. He may be wrong but he has that capacity to do that. All those ‘passive’ index-tracking investors could indeed chase the markets up the steep cliff but would also chase them right over the top like a bunch of lemmings too – and then, ‘low cost’ is suddenly ‘very expensive’ and you have all the worry of ‘what do you do next’ – no advice, no guidance – your decision alone and tune to call and sadly that is often when unadvised investors (advised ones are bad enough as are advisers too very often…) do the wrong thing and panic. Then suddenly all that extra return from ‘cost saving’ is gone in an instant whilst the retained professional adviser with active management continues trying to do his best for his clients and who has anchors upon which to hold because he is making decisions based upon reasoning.
EX-ORGANIC CLIENTS
An update – Money Redress Ltd (a Claims’ company) has had a regulatory bar placed upon it against pursuing claims against Pension Calculator Ltd (previously an authorised representative of MultiCorp Rose and NJ Associates). That is good news – if you are an ex‑PCL client and have not lodged a complaint yet, contact us as soon as you can. There are no costs involved. Watch-out though in that we have had some clients say another firm has suspiciously secured their confidential information and has been contacting them – do keep us posted.
IN THE NEWS AGAIN
The Financial Times’ sister magazine, “Financial Adviser” has quoted me again in comment on Property Funds – this is all about managers charging fees on the cash reserves they are obliged to hold. See my abbreviated comments here! I suggested investing in property in different ways – especially ‘REITs’. All that said, I am not accustomed to being on the front page as this article is! https://www.ftadviser.com/investments/2019/07/24/property-funds-make-millions-from-cash-fees/?page=1
RISK WARNING
Stock market investments can offer income through the payment of dividends and interest and good opportunities for capital appreciation over the longer term. By this, generally we mean periods in excess of five years, preferably much longer. However, we can never promise you particular returns, especially in the short-term. At any point in time but especially in the short term, your capital could be worth less than the original amount invested as some of the selected holdings may fall in value, regardless of expectations at the time of acquisition. We may also invest in funds that hold overseas securities. The value of these investments may increase or decrease as a result of changes in currency exchange rates. Returns achieved in the past cannot be relied upon to be repeated.
To remind you, why do I send out occasional emails? Because everyone can save money. We have no connection with any companies mentioned and you have to make your own contacts and satisfy your own enquiries. What is in it for us? If we can prove that we are knowledgeable and that our service and advice have good value, then you might contact us for professional financial planning and investment help. You don’t have to do that though and there’s no charge for emails. If simply they save you money, then accept them with our compliments! However, you’ll know where we are!
If you have any queries of any form or indeed any subjects you think I could include, please contact me. I also refer you to our website www.miltonpj.net. We celebrated our thirtieth anniversary in 2015 and have been publishing a well-respected independent column in the local Paper for most of that time and free client newsletters as well.
Do not forget however the usual caveats – this is not ‘advice’ and you are encouraged to seek that before embarking upon any financial route involving investments, etc.
My best wishes
Philip J Milton DipFS CFPCM Chartered MCSI FPFS FCIB
Chartered Wealth Manager
Fellow Of The Personal Finance Society, Fellow Of The Chartered Institute Of Bankers
