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As a result, businesses must take advantage of all available financial planning tools. In this article, we take a look at how business owners could use an economic calendar as part of their financial planning. 

An economic calendar is a completely free tool that provides a schedule of important upcoming financial events. This could include the release of economic data, bank decisions, speeches by policymakers, and government announcements. Using an economic calendar for financial planning in 2023 could make it easier to stay on top of the fast-moving industry and prepare businesses for potential market movement. 

Investment Planning

An economic calendar can be used to plan investments by identifying events that could impact certain markets and making decisions accordingly. For example, most economic calendars will provide information about the release of earnings reports which can be used to evaluate the strength of investments. Using an economic calendar, you can prepare to readjust your portfolio at key moments throughout the financial year. 

Big events can have a huge impact on the market so, investors must remain vigilant. Understanding when these events will occur is the key to beating the market and making good investment decisions. 

Budgeting 

Businesses must consider economic events when budgeting. By doing this, you could identify potential risks and economic opportunities that could help you to stretch your business budget. 

You may need to adjust your budget throughout the year to suit different market conditions. Economic calendars could help you to prepare for this so that you don’t miss any opportunities. 

Risk Management 

Economic events can impact businesses in several ways including changes in interest rates, changes in regulations, funding cuts, consumer spending changes, and changes in exchange rates. However, the risk of being affected by these events could be considerably mitigated by using an economic calendar to prepare. 

By staying up to date with economic events, you could develop an informed risk management strategy that will help your business to stay afloat despite potential economic changes. 

Cash Flow Management 

To increase your business's cash flow, it is important to be aware of upcoming economic events and plan accordingly. Events that you should be aware of include interest rate changes, economic downturns, and changes in consumer behaviour. Each of these events could have a direct impact on your cash flow. 

The best way to prepare for these events is to use a calendar that provides insight into key decisions and announcements. You can then plan around these events to ensure that your cash flow is not disrupted. 

Economic calendars are very useful tools that business owners could use as part of the financial planning process. You can find a range of excellent free calendars available online. A good idea is to use a calendar that can be filtered to show events that are most important to your business. 

 

You’ve saved diligently, researched your favorite areas, discussed the purchase with your family, and even daydreamed about decorating schemes. You may feel more than ready, but there are some important considerations to make before moving forward. Let’s review five steps you can take to help ensure buying your vacation home is a smooth, easy, and rewarding process. 

Think about the pros and cons

First, you’ll want to make a list of the pros and cons of purchasing a vacation home. Sure, you’ll have a place that’s yours to get away to during any time of the year, freedom to come and go as you please, a new location to explore and enjoy, and maybe even an investment property that can increase in value over time. However, with another house comes additional maintenance and repairs, which can incur unexpected costs and financial setbacks. Write out your list of pros and cons and make sure that they balance each other out, and that you’re prepared to deal with any of the natural pitfalls that come with owning another home. 

Consider how much you’ll use it

You’ll also want to seriously consider how much you’ll be able to use your vacation home. Do you have a flexible work schedule? Kids in school? A partner who can’t get away as often as they’d like? Be realistic about the amount of time you’ll be able to spend enjoying your vacation home, and how you might be able to put it to use when you’re not occupying it. 

Decide whether you’ll rent it out

Renting out a vacation home can be a great source of passive income or an easy way to help supplement its cost. However, renting out a property is not for everyone. Before you purchase your vacation home, think about whether you’ll rent it out. If the answer is yes, decide on some initial parameters. For example, maybe you’ll rent it out only during certain months, or only to family and friends. It might also be helpful to crunch some numbers while making your decision. 

Find a trusted agent

An important step before buying your vacation home is to find a trusted agent who can work with you and your family to find the property that suits all—or most—of your wants and needs. Be clear about what you’re willing to compromise on. You should feel comfortable communicating exactly what you’re looking for and collaborating with your agent to find the home that’s right for you. 

Think about purchase protection

Finally, it never hurts to begin thinking about purchase protection. Consider life insurance—potentially a permanent life insurance policy like whole life insurance, which includes a cash value component that you can borrow against for any reason, including home repairs. The death benefit from a life insurance policy can help ensure that your dependents will continue to be able to pay the mortgage even if you pass away unexpectedly.

Introduction to Financial Planning

Financial planning is the process of setting goals, evaluating your present financial situation, and creating a plan to reach your financial objectives.

The first step in financial planning is to develop a clear understanding of your current financial situation. This includes identifying your sources of income, your expenses, and your assets and liabilities. Next, you need to set financial goals. These goals should be specific, measurable, achievable, realistic, and time-bound.

After you have set your goals, you need to develop a plan to achieve them. This plan should include strategies for saving money, investing money, and managing debt.

Finally, you need to monitor your progress and make adjustments to your plan as needed. This will help you stay on track and reach your financial goals.

Budgeting Basics

When it comes to financial planning, one of the most important things you can do is create a budget. A budget is a tool that allows you to track your income and expenses so that you can make informed decisions about how to best use your money. 

There are a few key things to keep in mind when creating a budget:

● Make sure to include all sources of income, not just your paycheck. This could include money from investments, gifts, or side hustles.

● Be realistic about your spending. It can be easy to underestimate how much you spend each month on things like food, entertainment, and clothes.

● Set goals for your spending. Having specific goals in mind will help you stay on track with your budget. For example, if you want to save up for a down payment on a house, you’ll need to make sure your budget includes room for that goal.

● Review your budget regularly. Things change over time, so it’s important to revisit your budget every few months to make sure it still makes sense for your current situation.

Retirement Savings Strategies

When it comes to financial planning, one of the most important aspects is saving for retirement. There are a variety of retirement savings strategies available, so it’s important to do some research and figure out which option is right for you.

One popular retirement savings strategy is contributing to a 401(k) plan through your employer. This type of plan allows you to contribute a portion of your wages into a tax-deferred account. Another option is opening an Individual Retirement Account (IRA). With an IRA, you can make contributions with after-tax dollars and potentially get tax-free withdrawals in retirement.

If you’re self-employed or don’t have access to a workplace retirement plan, there are still options available for saving for retirement. One option is to open a Solo 401(k) account. This account works similarly to a traditional 401(k), but it’s specifically for self-employed individuals or business owners. Another possibility is to contribute to a regular brokerage account. This doesn’t offer the same tax benefits as a retirement account, but it can still be a helpful way to save for the future.

No matter what strategy you choose, the most important thing is to start saving early and contributing regularly. The sooner you start saving, the more time your money has to grow. Even if you can only afford to save a small amount each month, that’s okay – every little bit helps!

Conclusion

Financial planning is a critical skill for managing your money. These essential tips are designed to help you navigate your financial future and make the most of your resources. 

With solid goals, diligent budgeting, and effective investments, you can set yourself up to live more comfortably now and better prepare for retirement down the road. CreditNinja could help you to create a more optimal financial plan that properly accounts for prospective risks as well as unexpected changes in life's journey.

Financial Planning: The Basics

When you're involved in this type of planning, you first need a sense of your current financial state. Therefore, you'll research and list all of your company's financial assets and liabilities.

In the process, you'll answer questions such as the following:

With such information, you can set financial goals for your ecommerce company in the short term and over the long haul. For instance, you might have certain objectives for the next month, quarter, year, or even five years. Three-year plans, by the way, are especially prevalent in business.

On top of that, you'll figure out the most strategic investments you could make to achieve your goals. However, as you plan those investments, you should also set some financial parameters. For instance, you might want to have a certain amount of cash on hand at all times. Naturally, you never want to bet on the house.

In addition, a completed financial plan will tell you what your priorities are. If you're ever low on cash, you'll know which endeavours to keep funding and which you could defund. Keep in mind that, with financial management for ecommerce, there are no guarantees. No one knows, for instance, what the markets will look like over the next decade or what the demand for certain products could be in five years.

For that reason, try to always have extra money on hand in case of an unexpected financial problem: a sudden stock market crash, for example. In all of this, financial planning requires flexible thinking, creativity, keen analysis, and educated guesses. It's a process you'll probably get better at with time and experience.

Why Is Financial Planning So Important?

Many benefits come with financial plans. For starters, when you make a list of your liabilities, you may find some wasteful spending or redundancies you could eliminate. As a result, your ecommerce business will be more efficient. Any money you're currently misspending could be redirected toward your financial priorities, which would ultimately bring in more revenue. Furthermore, solid financial plans — those that are backed up by data — appeal to investors. With that extra funding, you might complete your projects sooner and reach your objectives faster.

These plans can also help you spot problems as soon as possible. Each month, you could look at your financial results and compare them to your expectations. If those numbers are roughly the same, you could keep doing what you've been doing.

On the other hand, if your actual revenue for a given month fell short of your projected revenue, you could immediately take action. You could analyse your operations, figure out what's not working, and make adjustments right away. Perhaps a certain marketing campaign isn't targeting the right audience. Or maybe one particular service isn't taking care of your customers' wants and needs.

By contrast, without those financial expectations, your company's weak spot might not get addressed for a long time. Consequently, your revenue for the year would be lower than it could have been.

Note, too, that financial planning isn't just for established companies. Even if you haven't launched your small business yet, a financial plan could be essential to your work. It would assess the marketplace demand for whatever you're offering and help you estimate your initial profits. Plus, it should be easier to attract your first-ever investors with such a plan.

Here's another advantage: If you've hired employees to work at your ecommerce company, a business plan could help to unify them. When you tell them precisely what your goals are, how you will attain them, and when you're likely to reach them, your whole team could have newfound feelings of confidence and purpose.

Indeed, once they read through your financial plans, your employees will each have a distinct mission. They're likely to feel like they're part of something grand, something bigger than themselves. As such, they'll probably be inspired to put in their best efforts every day.

In the end, it's wise to create new financial plans every year. By doing so, you can continually update your goals and expectations, taking into account new information and unforeseen developments. Your entire company will then have accurate assessments to guide them. And your ecommerce brand will be positioned for many shining achievements in the days and years ahead.

This creates a major financial burden for physicians, especially early in their careers. They are often unable to buy a home or start a family until they have paid off their loans. And, even then, they may find themselves struggling to make ends meet. This is a major problem that needs to be addressed. We need to find ways to make medical school more affordable so that our doctors can start their careers without crippling debt. But for now, here are 5 strategies for doctors to better manage their debt: 

1. Make a budget and stick to it

This will help you track your spending and see where you can cut back. Another strategy is to make extra payments on your loans. As a result, you will eventually pay less interest. You can also look into refinancing your loans. This can lower your monthly payment and save you money in the long run. Finally, don't forget to take advantage of the tax breaks and deductions available to you. 

2. Don't take on more debt

Debt is often a necessary part of a physician’s life. However, this doesn't mean that they should take on more debt than necessary. Managing loans is essential, and physician loans can be a great way to get the money needed to pay for the home you’ve recently bought because you've shifted to another city due to a job. Physicians should be mindful of the amount of debt they are taking on, and make sure they can afford to make their monthly payments. 

It's also important to remember that debt is not always bad. Loans can help physicians buy a home or car, and can even help them start their own practice. However, it's important to use loans wisely, and not take on more debt than is necessary. Physicians should always consult with a personal finance company exclusively for healthcare professionals like LeverageRX before taking out any loan, in order to make sure they are getting the best deal possible. 

3. Pay off debts with the highest interest rates first

Debt can put a huge weight on your shoulders, especially when the interest rates are high. In order to reduce the overall amount you owe and make your payments more manageable, it’s important to pay off your debts with the highest interest rates first. This will reduce the amount of money you pay in interest over time and help you become debt-free sooner.

If you have several different loans, try prioritising debts based on the interest rate, starting with the highest rate and working your way down. You can also use a debt calculator to help you figure out how much you’ll save by paying off certain debts sooner rather than later. 

4. Take courses and learn about financial planning options

Investing in yourself is a great way to improve your finances. Learning about all of the different loan options available to you can help you get the best deal that fits your needs. Many people do not know how to save money or how to invest money wisely. By taking a course on financial planning, you can learn how to save for retirement, build your credit score, and more. This knowledge will help you better manage your money now and in the future.

5. Hire a financial advisor company

When it comes to managing your personal finances, the most important but often overlooked aspect is working with a financial advisor company. When you work with a financial advisor company, you can get help managing your loans and other financial products. This can be especially helpful for physicians who have a lot of student loan debt.

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What made you choose this particular career path and where did you get your start?

I’ve always enjoyed numbers - since I was young. My dad was an accountant, so I guess the apple didn’t fall too far from the tree. The challenge was that my other passion was helping people. So, I needed to find a blend of both. Fortunately, this career is exactly that! Numbers. And helping people. I am so lucky that I found a way to combine both my passions in one amazing career. I started in the industry in 2003 and it’s this combination of numbers and helping people that continues to fuel my love for what I do each and every day.

What are your tips on managing one’s wealth during turbulent times?

I believe everyone should have a financial plan. A big part of what my team and I do is help folks craft a proper financial plan, which can answer some key questions: Will I have enough to retire? When can I retire? What does the tax on my estate look like? What rate of return do my investments need to generate for my plan to be fully funded? Having the answer to those questions, in my view, is always helpful, it can be the roadmap to ensure you are on track to achieve your financial goals. That’s helpful in good economic times, it is especially helpful in turbulent times. During volatile periods one of the first things we do is revisit the plan and ensure we are still on track to achieving our clients’ goals. If you don’t have a plan, the good news is it is not too late, you can still get a proper plan in place. It will clarify your goals and help provide perspective during turbulent markets.

In terms of the investment portfolio, I am not a fan of big changes to the portfolio in the mix of market turbulence. If you structured your portfolio correctly, you should be able to handle the bumps. Understandably emotions can run high when markets get turbulent. It is easy to talk about the long term, but when markets get turbulent, it is hard to look past the turbulence. When volatility happens, I think it’s human nature to focus on it. Оur time horizon shrinks. It can feel like the current environment will last forever and it is tempting to make a large change to your portfolio. That type of strategy overhaul can feel good in the moment, but in the long term could knock your plan off track. I believe a proper financial plan can help fight that temptation. As mentioned above, a well-done plan is structured for good times and bad, it also provides a framework to evaluate your investment portfolio. The plan can tell you the long-term rate of return required to achieve your goals. In my view, that can provide some perspective during bouts of market turbulence.

What is the most fulfilling element of your job?

Helping people. One client of mine, whose husband had passed away, was not only grieving but came to us in a state of desperate need of direction and navigation. Her husband had handled all things financial for them and she was in effect, lost, without guidance. I walked through the entire situation with her, including every step and option, helping her regain confidence and comfort. She was and is to this day, very grateful. Being able to help people feel more at ease with their finances is easily the most enjoyable part of this job and, to this day, is part of what drives me to continue coming to the office every day.

You can contact Clinton at corr@cgf.com.

 

CANACCORD GENUITY WEALTH MANAGEMENT IS A DIVISION OF CANACCORD GENUITY CORP., MEMBER-CANADIAN INVESTOR PROTECTION FUND AND THE INVESTMENT INDUSTRY REGULATORY ORGANIZATION OF CANADA.

Are you someone who likes to plan ahead and this of the Long-term? If so, you're in luck! In this article, we discuss some useful financial tips that can help you save money and prepare for retirement. Even if you're not quite ready to think about retirement yet, it's never too early to start planning for the future. These tips will help you get started on the right track. So what are you waiting for? Read on to learn more!

Estimate Your Retirement Needs

One of the most important things to do when planning for retirement is to estimate how much money you will need. This number can vary depending on your lifestyle and budget, but it's important to have a ballpark figure in mind. You'll also need to consider factors such as inflation and future healthcare costs. If you're not sure where to start, there are a few online calculators that can help.

Another important retirement planning tip is to start saving early. The sooner you start putting money away, the more time it has to grow. Even if you can only save a small amount each month, it will add up over time. If you're in your 20s or 30s, now is the time to start thinking about retirement. It may seem like a long way off, but it's never too early to start planning. One last tip is to diversify your retirement savings.

Assessing Your Net Worth

One of the best ways to start planning for your future is by assessing your net worth. This will give you a good idea of where you currently stand financially and what steps you need to take in order to reach your goals. There are many online calculators that can help you do this, or you can use a spreadsheet. Be sure to include all of your assets (property, savings, investments, etc.) and liabilities (debt, bills, etc.).

Once you have a clear picture of your net worth, you can start making a plan to improve it. And if you are making a plan be sure to consider the fact that, annuities are long-term investments. If you have debt, work on paying it off as quickly as possible. Make sure you are contributing to your savings account and have a solid emergency fund in place. 

Invest in assets that will appreciate over time, such as stocks or real estate. And finally, stay disciplined with your spending so you can continue to make progress towards your goals.

Have An Emergency Fund

One of the most important things you can do for your financial future is to have an emergency fund. This is money that you set aside specifically for unexpected expenses, like a car repair or medical bill. It’s important to have this money saved up so that you don’t have to go into debt when something unexpected comes up.

How much you should have in your emergency fund depends on your individual circumstances. A good rule of thumb is to have enough money saved to cover three to six months of living expenses. If you have a family or are supporting others, you may want to save even more.

Saving for an emergency fund can seem like a daunting task, but there are a few things you can do to make it easier. First, break the goal down into smaller goals. For example, try saving $50 per month until you have enough money saved up. You can also use a budget to help you stay on track.

Knowing Where Your Money Goes

One of the most important things you can do when it comes to saving money is to know where your money goes. This may seem like a no-brainer, but you would be surprised how many people don't keep track of their spending. If you don't know where your money is going, then it's very difficult to save. There are a number of ways to keep track of your spending, such as using a budget or tracking app. Find the method that works best for you and make sure to stick to it.

Another important tip is to create a savings plan. This may seem like common sense, but so many people don't have a savings plan in place. When you have a plan, it's much easier to save money. Figure out how much you need to save on a monthly or yearly basis and then make sure to stick to it. There are a number of ways to save money, such as setting up a savings account or investing in a retirement fund. Find the method that works best for you and make sure to stick to it.

Get a Grip On Taxes

The best way to get a grip on your taxes is to start planning for them as soon as possible. You don’t need to be an accountant to do this, either – there are plenty of online resources and tools that can help you out. The earlier you start, the more prepared you will be when it comes time to file your return.

Another important thing to keep in mind is that taxes are not a one-time event. They are an ongoing process, and you should be prepared to adjust your plan as your circumstances change. Stay on top of your finances throughout the year, and you will be better positioned to take advantage of tax breaks and deductions when they become available.

Finally, don’t be afraid to ask for help. If you are unsure about something, or if you need advice on how to structure your tax plan, don’t hesitate to get in touch with a professional. They can help you make the most of your money and ensure that you stay in compliance with the law.

Protecting Your Wealth

One of the best ways to protect your wealth is by diversifying your assets. This means that you should not put all your eggs in one basket. Instead, spread your money out among a variety of different investments, such as stocks, bonds, real estate, and commodities.

This will help to reduce your risk if one investment goes south. You should also consider investing in a variety of different industries to further diversify your portfolio. This will help to protect you from any industry-specific risks that may arise.

Another important way to protect your wealth is by staying informed and keeping up with the latest financial news. This will help you to identify any potential threats to your investments and take action before it's too late. You should also make sure to keep your financial documents up to date and in a safe place. This will make it easier for you to track your investments and access your information when needed.

Saving money for the long term can seem like a daunting task, but it doesn't have to be. By following these tips, you can make it easier to save money and reach your financial goals. Stay informed and make sure to keep track of your spending, create a savings plan, and diversify your assets to protect your wealth. With a little bit of effort, you can achieve financial success for years to come.

 

With peer-to-peer competition at its lowest level in years and the requirement for advice growing, Victoria Hicks, Director at City & Capital Acquisitions, looks at the five things you need to know if you’re thinking of taking up a position within this varied and rewarding sector.

Only 15 years ago the financial advisory sector was ‘home’ to more than 200,00 practitioners, and competition was fierce. But an ageing population and stricter regulations – particularly as a result of the retail distribution review (RDR) – has seen that figure shrink to around 25,000 planners in recent years, with many of the ‘old guard’ retiring and less talent coming from other industries.

A lot of firms are looking for colleagues who can bring demonstrable skills – which aren’t always overtly linked to financial planning.

At the same time, regular changes in legislation and tax allowances, as well as an increase in demand for even more complex advice, is creating a wealth of opportunities as individuals look to take hold of their financial futures.

  1. Change is afoot

Historically, many workers adopted a ‘job for life’ mentality, which tended to come with good pension and retirement schemes to boot. With this safety net diminishing, there is a need for people to take far better care of their finances from an early age, providing a great opportunity for advice.

Additionally, the industry as a whole is seen as less of a male-dominated, sales-led business, and more of a profession whereby clients select an adviser they trust – and like. Empathy and clear moral code are central to a successful career in financial planning, as customers look for someone to understand their current situation, as well as their ambitions for later in life.

Women are doing particularly well within this sector. An uplift in financially independent females – either as a result of a career or marital separation – has generated an increase in demand for advice from the same sex.

  1. Nail your niche

As the numbers are skewed towards financial planners, it may be wise to specialise in a sector which interests you – rather than having to be a jack of all trades.

Research what it means to work in this profession, and delve deeper into the areas you want to operate in. You might choose to oversee investments and pensions – looking at a person’s entire situation and creating a long-term, holistic plan to evolve with them – or you could be considering a specialism in mortgages and insurance, later life planning or estate planning to name but a few of the more specialist areas.

Once you’re qualified though, it’s important to tailor any further training and development to suit your ambitions and consider those exams or accreditations which are sought after by other professionals that are also operating in your market, such as legal or tax professionals. With training above and beyond the standard level, you’ll be in a strong position to win business both directly with the end-user, as well as from other professional partners.

Specialist accreditation from organisations such as Resolution, The Society of Later Life Advisers (SOLLA), The Society of Trust and Estate Practitioners (STEP) or Certified International Financial Accountant (CIFA) are all a great place to start.

  1. Don’t ignore the basics

Of course, everyone wants to enter into a career and be operating at the very top of their game after the first year – or in some cases, from day one! But it’s important to gain some ‘real world’ experience before you start to climb the proverbial ladder.

Firstly – and particularly if you’re new to the world of financial planning – it’s important to decide whether you want to work on an employee or self-employed basis and if you’re looking to operate as an independent or restricted adviser. It’s worth thoroughly researching into the nuances of each option, before deciding which best reflects your long-term personal and professional ambitions.

Don’t be afraid to get an admin or paraplanning role at the start of your career either. It’s crucial that financial advisers understand how a business operates and gain some ‘life experience’ – after all, successful company owners will look to someone with a level of worldliness before placing trust in them.

  1. Think outside the box

A successful career isn’t as prescriptive as it used to be. A lot of firms are looking for colleagues who can bring demonstrable skills – which aren’t always overtly linked to financial planning.

An understanding of people, strong ethical code and excellent time management has seen those from legal, military and sports backgrounds have long and illustrious careers in financial planning, thanks – in part – to their innate drive and dedication.

Furthermore, there is a lot of discussion around environmental, social and corporate governance (ESG) investing. Individuals no longer simply look for a positive financial outcome, but they are interested in the wider implications their assets might have in promoting global issues, such as climate action. Through your own research, if this sort of area is of interest to you, take the time to learn about those companies active in this market – which share your wider personal and social goals.

  1. You never stop learning

The economic client is evolving at a rapid rate, and it’s important to remain at the sharp end of the industry in order to flourish.

The FCA Register is also a wealth of information when looking into authorised firms and people, so  try to make a habit of visiting the FCA’s website on a regular basis, connecting with relevant people – and pages – on LinkedIn, and reading industry updates.

It’s all-too-easy to discard a daily news summary landing in your inbox when you have a to-do list as long as your arm – but it’s important to be in the know.

 

About City and Capital Acquisitions:

City and Capital Acquisitions aim to disrupt the traditional stereotypes surrounding how Financial Advisory (FA) acquisition brokers work. The firm offers a consultative approach for buyers and sellers of FAs across the UK and is headed up by Victoria Hicks, chartered financial planner, and former owner of a directly authorised IFA firm.

Life expectancy may have stuttered over the past two years, sitting at an average of 85 for people over 65, but as populations continue to grow and live for longer than ever, it has never been more important to make correct and informed choices about how our assets will last the course.

Here, Tony Duckworth, MD and Chartered Financial Planner at Cowens Financial Architects, discusses how we can safeguard our precious pension pots through sound financial planning.

It’s no secret that state pensions aren’t enough to cover most people’s plans for their leisurely retirement years. The push on the need for private savings from the government and the introduction of the compulsory work-place pension in light of these ever-increasing age stats have further heightened the pressure on working people to get their finances in order. The good news is, it’s never too late to start putting the wheels in motion to build a portfolio of assets designed to meet your future financial needs, while also ensuring loved ones are protected should the worst happen.

The introduction of Pension Freedom in April 2015 means that anyone over the age of 55 can now withdraw their hard-earned private pot as a lump sum, paying no tax on the first 25%. This move, although liberating for many soon-to-be retirees, has opened a labyrinth of options and potentially wrong decisions.

Recent research from the FCA (Financial Conduct Authority) has found that around 100,000 over 55s withdraw money from their pensions every year without seeking financial advice[1], something the organisation is campaigning hard to change. It’s difficult to imagine that this many people have got to this point without any sound advice.

Recent research from the FCA (Financial Conduct Authority) has found that around 100,000 over 55s withdraw money from their pensions every year without seeking financial advice.

Having a comprehensive financial plan with a clear strategy to deliver to your retirement needs is key to understanding the best way to maximise your pension freedom. A Ferrari may seem a fantastic idea within the first week of your new-found retired lifestyle, but in many cases, your pension pot will have to last for almost as many years as it took to save it and a purchase like this may put too much strain on your pot to meet your needs for the remainder of your lifetime.

Care must also be taken when looking at annuities, although well-advertised as a sensible alternative to withdrawing lump sums of your pension, exchanging your pension pot for a monthly income is irreversible, holds little flexibility and gives little scope to pass on benefits to future generations. With no chance of growth, an annuity won’t earn you any interest and restricts your ability to invest for the future. In fact, since pension freedom was introduced, sales of annuities have tumbled by 80% according to the ABI[2] (Association of British Insurers).

The easiest way to protect your funds and cut through the confusion is to seek expert financial advice – it’s the best way to understand when you can retire with confidence, while also ensuring your assets are structured suitably and invested in a risk-managed strategy designed to maximise potential returns. An adviser will spend time discussing what is important to you in life, your goals and aspirations for the future, and learn about the important things you want to plan for. Creating a clear vision for your retirement is the most solid route to understanding what is possible with the money you’ve saved.

Seeking expert help both throughout our working lives and as we hit retirement age is a sure way to take the dreaded stress and worry off our shoulders when we hit our 60s.

There is hope when it comes to the increasing retirement age – a financial adviser may be able to plug the gap between when you want to retire and when your state pension kicks in, structuring your assets and income to minimise tax payments and help your money go further. In the best case, retirement may be closer than you imagined!

When planning for our futures, ‘what ifs’ still need to be taken seriously and a rainy-day fund is essential. With the NHS in the UK in turmoil and people living way into their 80s and 90s – the cost of private health care, medication, and elderly long-term care must be accounted for within a financial plan.

In 2017/18, Paying For Care found that the average cost of a residential care home in the UK was £32,344 a year, rising to over £44,512 a year when nursing care was included[3]. Just one hour of daily care can total up to £6,700 per year in some parts of the country. State funding rules are constantly changing – currently, if your assets come to a total of £23,250 or more by the time you or your partner need this type of care, you will be expected to cover all care costs yourself, which could leave you short if the right measures aren’t in place. A financial expert can help with things such as equity release, payment schemes, and insurance policies to guarantee your cash flow and take some of the burden if care was needed.

Although financial planning and retirement planning are essentially two separate entities, they must go hand in hand in order to provide the lifestyle you want. Getting down into the granular detail of your finances as you approach retirement is the best way to assess what actions are needed to maximise your assets to last. Seeking expert help both throughout our working lives and as we hit retirement age is a sure way to take the dreaded stress and worry off our shoulders when we hit our 60s.

As we strive to save, invest and grow our assets over the course of our working lives, the transition to withdrawing and living off those funds may seem a terrifying concept. But through solid advice and good decision making, you can guarantee financial freedom throughout your golden years.

 

About Cowens Financial Architects

Cowens Financial Architects is a trading name of R A Cowen and Partners Financial Services Ltd, part of Cowens Group. The team delivers a range of financial planning services, focused on helping people to make the right financial decisions, including financial planning, investment advice, retirement planning, and inheritance tax planning.

 In addition to the financial planning provided by Cowens Financial Architects, the business also provides corporate financial planning through its brand, Cowens Employee Benefits Ltd.

R A Cowen & Partners Financial Services Ltd. Registered office: Inbro House, Commercial Gate, Mansfield NG18 1EU. Authorised and regulated by the Financial Conduct Authority.

 

[1] https://www.moneysavingexpert.com/news/2019/01/new-rules-to-make-pensions-clearer/

[2] https://www.iress.com/uk/resources/insight-research/retirement-report-retirement-income-and-annuity-perspectives/

[3] https://www.payingforcare.org/how-much-does-care-cost/

Finance Monthly speaks to the Director of the Financial Planning Program at Stephen F. Austin State University - Banker Phares, who has been licensed to practice law in the State of Texas since 1964. He was founding member of the Estate Planning and Probate Specialty for the State Bar of Texas in 1977 and still holds that specialty certification which is renewed every five years. Representing individuals, businesses, and foundations interested in charitable giving, he provides advice concerning the amount, structure, use, and deductibility of charitable gifts.

What do you think prompts charitable giving in the US?

In 2017, I wrote an article on Charitable Giving in the United States. Using a report published by Giving USA Foundation, I found that charitable gifts in the United States totaled $410.2 billion in 2017. The percentage breakdown is as follows: 70% was given by individuals, 16% by foundations, 9% by bequests at death, and 5% by corporations.

A study by The Comparative Nonprofit Sector Project sponsored by Johns Hopkins Center for Civil Society Studies made a study of the level of giving by different countries. According to that study, the level of giving is determined by comparing the giving to the Gross Domestic Product (GDP) of a country. Using that test, individuals in the United States gave 1.85% of the GDP, Israel gave 1.34%, and Canada gave 1.17%. When volunteerism is the sole criteria, the study concludes that the Netherlands is first, followed by Sweden and then the United States.

Using a report published by Giving USA Foundation, I found that charitable gifts in the United States totaled $410.2 billion in 2017.

It is difficult to determine why a business makes a charitable contribution. From my 54 years of experience, I know that some do it for public relations purposes and some do it out of social conscience. I have listened to discussions where leadership groups “cherry pick” charitable organisations – not for altruistic purposes - but for the favorable publicity. Regardless of motive, the charities benefit.

What should businesses be mindful of when supporting charities?

Businesses should be very selective, and should examine the annual filings of the charity to determine the reputation of a charity and the amount a charity uses for charitable purposes. A large business has the opportunity to make a substantial contribution thereby allowing a charity to carry out charitable purposes it otherwise would be unable to undertake.

Businesses should be very selective, and should examine the annual filings of the charity to determine the reputation of a charity and the amount a charity uses for charitable purposes.

About Banker Phares

Banker Phares graduated from the Southern Methodist School of Law with Juris Doctor Degree in 1964, and, while there, served on Board of Editors of Southwestern Law Journal, and as a member of the Barristers. He became Board Certified in Estate Planning and Probate Law in 1977 by the State Bar of Texas. He is the Director of the Financial Planning Program at Stephen F. Austin University, and teaches in the Department of Economics and Finance. He is the John and Karen Mast Professor. He is also the Director of the Marleta Chadwick Student Financial Advisors, organised to the purpose of informing students and the public with the need for financial planning.
Banker Phares is engaged in Solo practice of law in his area of specialty with law offices in Beaumont and Nacogdoches, Texas. He has designed charitable estate plans which include gifts to universities as well as public and private foundations. He has also created public and private foundations as a component of estate plans. The gifting methods utilised include direct gifts of cash and other property to charitable lead and charitable remainder trusts, and the design of conservation easements.

Equiom is an international professional services provider with a strong presence in Europe, Asia, the Middle East and the Americas. The company specialises in providing bespoke solutions to both private and corporate clients to assist with all of their financial planning and wealth protection requirements. Here, Richard Tribe, Head of Equiom Private Office and Laura Brown, Senior Manager, Equiom Jersey discuss what’s involved in offering a premium service to clients.

What are the typical challenges that clients approach Equiom with in relation to the management of their finances?

Richard Tribe: Equiom Private Office deals with the more complex wealth structuring cases, where clients are seeking completely bespoke solutions.Typically this would involve a wide range of assets, often spread internationally, that perhaps need consolidating into a structure (typically a trust or foundation) that both protects the assets and affords sensible future succession planning.

Laura Brown: Confidentiality is another consideration. Many of our clients are residents in countries where significant wealth can be a security issue and so, utilising suitable structures can reduce, or remove, such concerns. Of course, the clients are always fully aware of their obligations around full disclosure and transparency for tax reporting purposes, and we work very closely with their legal and tax advisers to ensure any structuring is compliant and fit for purpose.

Can you outline the process you go through to assess your clients’ current financial situation and assist them with identifying financial goals and concerns?

Richard Tribe: We are often asked to review a client’s current situation, which can be quite an involved process. If there are structures already in existence, these will need to be looked at carefully to ensure they are still providing suitable protection. Then, we will discuss with the client their future plans and requirements, and ultimately determine how best we can achieve their goals.

Laura Brown: The concerns of wealthy families are often very similar, regardless of their nationality. As mentioned previously, protecting the family wealth is often the main priority, but educating existing and future generations is always an important consideration, as is philanthropy. We are seeing more and more families who want to give something back to society and so part of our remit is to work with them to put suitable plans into operation. Impact investing is gaining real momentum at the moment and a lot of my clients are increasingly interested in structuring part of their wealth into these areas.

Tell us about Equiom’s Private Office services. What is the typical client that they are aimed at?

Richard Tribe: Equiom Private Office (EPO) was launched earlier this year. It is not a product offering, but more specifically a specialist team dedicated to providing clients with the highest levels of professionalism and personal service. Once we understand the client needs, we can draw on the variety of expertise across the entire Equiom Group to establish the most appropriate team to provide the optimal solution. Transparency and trust are fundamental to this approach and these are established through building a deep understanding of clients’ needs and their ongoing objectives. EPO has been very well-received in the market as it is an entirely unique approach, which I believe is unmatched among other service providers.

What are the most common tax planning solutions that you offer to your clients?

Laura Brown: When sitting down with both current and prospective clients to discuss their requirements in terms of wealth and estate planning, we first have to consider the tax implications both in Jersey and in any other jurisdictions where the client resides or holds assets. Where a client is considered tax resident is an important consideration, as is where a client is considered domiciled or deemed domiciled. The changes to the UK domicile laws and how UK property is taxed when held in offshore structures, which became effective in April 2017, have had a significant impact on wealth planning for clients who either reside in the UK or hold assets there. Aspects such as these greatly influence the advice we provide to clients.

What options are available for those who want to manage tax on their estate in Jersey?

Richard Tribe: From a Jersey perspective, Equiom can offer a range of solutions to clients who are looking for effective wealth and estate planning options. One such option is a Jersey trust. The trust is Jersey law governed but does not have to have Jersey resident trustees, though in many instances having Jersey resident trustees can be beneficial. The Jersey Government does not levy fees or any other duties when creating a trust or during the life of the trust. In addition to this, Jersey law contains specific provisions which do not comply with forced heirship laws (laws of certain countries which require specific portions of a person’s estate to be left to specified persons). To put this more plainly, a settlor can transfer his or her assets to a Jersey trust during their lifetime and Jersey law will not give effect to any rule of another country relating to inheritance or succession which says that such a transfer is not allowed. This means that a Jersey trust allows the settlor the absolute freedom to decide who will inherit the trust assets.

Laura Brown: Another option is the Jersey Foundation.The Jersey Government enacted the Foundations (Jersey) Law in 2009. Foundations are required to have a charter (which is open to public scrutiny) and a set of regulations (that are private). A foundation is a legal entity that is managed by a council of persons who can be natural persons or corporate bodies though at least one of the council members must be a Jersey regulated entity (known as the qualified member).The foundation has beneficiaries but the Foundations (Jersey) Law stipulates that the foundation council will not owe fiduciary duties to beneficiaries nor will beneficiaries be entitled to information about a foundation’s assets unless the beneficiaries have a vested interest. Jersey foundations have characteristics of both a company and a trust which makes them interesting entities for taxation purposes. A Jersey foundation can be drafted in various ways which affects the tax treatment in different jurisdictions.

 

About Equiom

Equiom has been advising wealthy families and multi-national businesses for decades. The services we offer have evolved over the years with changing market needs. With a thorough understanding of the current generation and the most experienced professional team across the globe to cater to each individual situation and client, we are well placed to find the optimal solution for our clients’ needs.

For more information on Equiom Private Office or to connect with a member of the team, contact privateoffice@equiomgroup.com.

Website: www.equiomgroup.com

Equiom (Guernsey) Limited and Equiom Trust (Guernsey) Limited are licensed by the Guernsey Financial Services Commission. Equiom (Isle of Man) Limited is licensed by the Isle of Man Financial Services Authority. Equiom (Jersey) Limited is regulated by the Jersey Financial Services Commission. Equiom (Luxembourg) S.A is supervised by the Commission de Surveillance du Secteur Financier (CSSF), the supervisory authority of the Luxembourg financial sector. Equiom (Malta) Limited is authorised to act as a trustee and fiduciary services provider by the Malta Financial Services Authority. Equiom Trust Services Pte. Ltd. is licensed by The Monetary Authority of Singapore. Equiom Trust Services (BVI) Limited is regulated by the British Virgin Islands Financial Services Commission. Equiom S.A.M. is authorised to act as a trustee and fiduciary services provider by the Ministry of Finance in Monaco. Equiom Trust (South Dakota), LLC is licensed in Guernsey by the Guernsey Financial Services Commission and in South Dakota by the South Dakota Division of Banking.

 

 

This article has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The article cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact Equiom to discuss these matters in the context of your particular circumstance. Equiom Group, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this article or for any decision based on it.

 

 

Matt Crawley is Corporate Finance Partner at accountants, business advisers and financial planners Lovewell Blake, one of the leading independent firms in East Anglia. He works closely with business owners across the region to help them develop and realise strategic aspirations, managing both the process and specialist advisers and lawyers. This month, Finance Monthly reached out to Matt to hear about his business development tips.

 

What would you say are the three key points for businesses to address when developing their businesses?

The Right People

Particularly for owner-managers, developing the second-tier management team, as well as attracting and retaining key talent, is a big challenge. Often, entrepreneurs baulk at paying for someone to run their business, something they may have been doing for some time, but recognising the necessity of this is a big factor in allowing the business to develop and grow.

 Businesses can be successful, but in order to continue to grow, it is important that the management team is developed. If this does not happen, the leader cannot effectively lead the business and strategically plan for growth. It also means that the routes to an exit plan are blocked: a business with a strong management team is a more attractive prospect to a trade buyer when the founder wants to retire, and if that doesn’t happen, it also opens up the opportunity for an MBO.

The need to retain key talent outside the senior management team is also a big factor, particularly in those sectors where IP is a big issue. Losing a key individual at the wrong time can effectively put the brakes on growth, so it is important to have the right structures in place to incentivise and retain key talent – for example putting in place an EMI scheme so that key people will themselves benefit from business growth.

Making sure you have the right people is just as important as finding new customers when it comes to business development. Often, the most successful growing companies are the ones where the entrepreneur has less to do – so that they can concentrate on driving that growth.

 

Managing Cash flow

It may seem obvious, but having robust financial systems in place is crucial for business development. Growth, and in particular rapid growth, can drain a business of cash, and many developing businesses under-estimate the amount of funding required to achieve that growth.

The big challenge here is to ensure that you have robust financial projections, which accurately reflect the needs of the business as it grows. Not only will doing so remove many surprises, it will also make it easier to find funding, as lenders and other funders will take a business more seriously if it can demonstrate that it understands the financial challenges inherent in developing itself.

It is important to stress test the assumptions you make in creating these projections, as well as the projections themselves, through scenario planning. Developing a business seldom goes entirely according to plan, and the trajectory for growth can be knocked off course by any number of external and internal factors.

Of course, sourcing the funding for growth is a challenge in itself. Whilst traditional lenders are now more open to proposals than they were five years ago, there are also now more routes than ever to finance, and it is important to explore them all in order to find the one which is right for a particular business.

It is clear that attitudes are changing: for example, younger entrepreneurs are open to the concept of using a discount facility – borrowing against invoices – in a way that an older generation of business owner might not be. Whereas in the past this would be viewed as debt factoring, something which might look as if a business was in trouble, now it is accepted as a legitimate way to raise funding for growth (and in any case is much more discreet than it used to be).

 

The Right Infrastructure

One of the main challenges in developing a business is to ensure that the infrastructure of the business is suitable for the particular stage of its growth. We often see firms which retain a start-up mindset even as they grow into multi-million businesses.

There are all sorts of infrastructure issues to think about to facilitate business development, from the expertise required to manage that growth; making sure that the business’s premises are suitable to accommodate growth (and finding both the right premises and the funding to move if they are not); a suitable legal framework; and ensuring that the brand is strong enough to be credible with the type of larger customers which growth often brings with it.

Perhaps the two major infrastructure challenges are finance and HR. It’s not just a question of compliance: getting these two right can make a big difference both in the company’s ability to deliver growth – and to do so profitably.

 

You work with clients from a variety of sectors; are there ways in which their business development needs differ?

Very definitely. All of the above challenges will apply to most growing businesses, but some will be more important than others in any individual sector.

For example:

 

What are the main barriers to business development?

Often tackling the challenges I have outlined can be seen by smaller businesses simply as a cost, which can be avoided. But our most successful clients are the ones which are prepared to engage with us and invest in the support needed to make growth happen.

Development support can only come from advisers who genuinely understand the business, who take the time to measure what needs doing – and their own progress towards achieving those goals – and who provide structured advice and a challenge to the entrepreneur.

 

Website: https://www.lovewell-blake.co.uk

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