In the wake of an injury, two financial foes loom: lost wages and loss of earning capacity. Both carve a sizable rift in one's financial health—but they're not twins. Lost wages refer to immediate income drained away during the recovery period, while loss of earning capacity casts a shadow on future possibilities, measuring what you could have earned if unscathed. This distinction is crucial when seeking compensation.

Now, let’s chart the course through these turbulent waters as we explore how to navigate the impact and defence strategies against these fiscal adversaries.

Accurately Calculating Lost Wages

When injury strikes, the immediate financial setback stems from lost wages—the tangible income you're deprived of as you recuperate. It's not a nebulous concept but an arithmetic certainty; your paycheques stop while bills do not. The accuracy of this calculation is pivotal because it forms the bedrock of your compensation claim.

Start with basic multiplication—your daily wage by the number of workdays missed—and don't neglect fringe benefits, bonuses, and overtime that evaporated along with your presence in the workplace. Then, consider subtle yet significant factors like promotion trajectories derailed and education or training sessions missed.

Proper documentation is your ally here (think pay stubs, tax returns, and employment contracts). These artefacts speak volumes about what you've lost in clear numerical terms. They provide a narrative to bolster your case—one that courts can understand and one that insurers cannot easily dismiss.

Quantifying Loss of Earning Capacity

While lost wages look back, loss of earning capacity peers into the crystal ball of your professional future. It's an estimate, albeit a sophisticated one, that reflects reduced job prospects and diminished opportunities in the wake of an injury. Here lies a more complex calculation than its retrospective counterpart, for it hinges on potential rather than precedent.

To make this projection, several factors come to bear: your age (youth may spell a longer term of loss), your occupation (some skills are more easily replaced or made obsolete), and the severity and permanence of your injuries.

By meticulously detailing how an injury has curtailed what you could have achieved professionally, you anchor these future losses firmly in today's money—a critical step towards full compensation.

Strategic Measures to Mitigate Long-Term Fiscal Impact Post-Injury

In the aftermath of an injury, defence against long-term financial repercussions should begin post-haste. It's not enough to identify losses; one must also take proactive steps to temper them. A strategic approach can make all the difference in shoring up your fiscal health.

One key tactic is the diversification of income streams. Consider investments, freelance opportunities, or even a side business that fits within your new capabilities. By broadening your source of revenue, you're not as tightly tethered to the fate of one single avenue.

Education and retraining are equally crucial—modernise your skills to stay relevant in a labour market that waits for no one. This may mean schooling or certifications in fields you hadn't considered but are now uniquely poised for.

Additionally, be relentless about insurance claims and government benefits—leaving money on the table is an unaffordable luxury for those already facing loss.

Navigating these avenues with sharp attention ensures that every possible resource is utilised in fortifying your financial future.

Partnering with Legal Professionals for Optimal Outcomes

Lost wages and loss of earning capacity are both types of economic damages that you could claim. So, how do you know if you are eligible for economic damages? To ensure you maximise the lost wages and loss of earning capacity that you are entitled to and receive optimal compensation, you must have an experienced lawyer by your side.

A legal professional won't just comprehend the fine print and loopholes; they will predict manoeuvres of opposition and prepare your case like grandmasters on the chessboard. Your financial stability may very well hinge on their expertise.

Conclusion

Navigating the financial aftermath of an injury demands a keen understanding of both lost wages and loss of earning capacity. Armed with precision in calculation, strategic foresight, and adept legal representation, you can not only chart a course through the storm but also sail towards a horizon where your financial well-being remains intact.

With salaries stagnating and inflation hitting record highs, UK households are feeling the squeeze, according to the Resolution Foundation. In particular, it is renters and those with young children who are most severely impacted.

According to the Resolution Foundation, household disposable income growth for working families dropped to just 0.7% a year in the 15 years leading up to the outbreak of the Covid-19 pandemic.

The data also shows a drop in living standards across the UK. Between 1961 and 2004-5,  typical working household incomes increased by 2.3% per year, on average, or 25% per decade. However, between 2004-05 and 2019-20, typical income growth slowed to just 0.7% per year.

Adam Corlett, Principal Economist at the Resolution Foundation, commented: “Households across Britain – and across many other countries – are currently grappling with high levels of inflation that we haven’t seen for generations.”

“But while many of the causes of the current crisis are global in nature, it is Britain’s recent history of low income growth and high inequality that has left so many households really struggling to cope.”

“Britain’s poor recent record on living standards – notably the complete collapse of income growth for poor households over the past 20 years – must be turned around in the decade ahead.”

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In April, regular pay excluding bonuses was down 3.4% after inflation. This marked the largest drop since records began in 2001, according to data from the Office for National Statistics (ONS).

ONS figures also revealed that, for public sector workers, real pay is falling by almost 6% a year. 

Tony Wilson, director of the Institute for Employment Studies, commented: “This is really grim news on pay and is only likely to get worse. Despite the tightest labour market on record, nominal pay is broadly flat meaning that rocketing inflation is leading to the largest cuts in real pay in at least two decades [...] The picture is particularly bad for public sector workers.”

The figures come as inflation spiralled to a 40-year high of 9%, due in part to soaring energy and fuel prices amid the Russia-Ukraine war. The figures further emphasise the cost of living crisis that people in the UK are facing as pay increases are swallowed up by rapid inflation. 

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May saw both job vacancies are placements slow, suggesting that employers are beginning to rethink their plans for growth due to skills shortages. According to the Recruitment and Employment Confederation (REC) and KPMG, many recruiters are blaming the situation on candidate shortages. 

According to REC and KPMG’s report, a diminishing pool of candidates and strong vacancy growth has seen rates of starting pay continuing to rise at a near record pace, especially for those taking up permanent positions. 

“These numbers show a hugely positive jobs market if you are looking for work,” commented REC chief executive Neil Carberry. “While the pace of growth has dropped after a stellar first quarter, by any normal measure there are still lots of vacancies out there, offering improved wages [...] Compared to pre-pandemic, labour supply is still the big issue we have to solve.”

NerdWallet’s survey of over 900 UK adults in full-time work has revealed their concerns regarding how the pandemic and rising inflation are impacting their finances. The survey found: 

• Since the start of the pandemic, 27% of full-time workers have seen their salaries decrease 
• 32% of participants said they are limiting their spending because they are worried about being made redundant
• 51% said they are concerned about how inflation will impact their finances
• 38% said their employer has paused pay rises throughout the pandemic
• 31% said that they will begin looking for a new job within the next six months if their wages do not increase in line with inflation

Senior personal finance editor at NerdWallet, Richard Eagling, said: “Understandably, businesses have had to make difficult decisions regarding wages, furloughing and redundancies during the pandemic. These decisions have impacted millions of people’s finances – and with rising inflation adding further pressure, many will find their usual budgets stretched to breaking point.

“Positively, there are support mechanisms in place for those struggling financially because of the pandemic. For example, banks have pledged to help those who find themselves in financial difficulty due to Covid-19, although this help varies from company to company. Likewise, some organisations such as UK Finance have promised to offer free support to those in need.

“In reality, financial challenges will continue to present themselves as the UK emerges from the pandemic. As such, it is vital that people take stock of their finances and, if problems are identified, seek assistance as and where it is available.”

Chancellor Rishi Sunak is preparing to scale back the UK government’s coronavirus furloughing scheme as lockdown measures are eased, according to several sources.

The Times has reported that the chancellor will announce plans next week to “wind down the scheme from July” in a bid to boost the economy, reflecting a growing attitude in government that recipients are in danger of becoming used to the aid it provides.

In an interview with BBC One on the future of the furloughing scheme, former Treasury minister David Gauke expressed worry that those workers currently furloughed might end up growing accustomed to their current circumstances.

“I don’t think anybody is addicted yet but if over time we end up paying people for staying at home, that’s what they’ll do,” he said.

The Coronavirus Job Retention Scheme has seen significant use, with almost a quarter of UK employees having been furloughed in the past fortnight alone. The chancellor will likely announce details of any plans to scale it back by mid-May, due to regulations mandating that employers making more than 100 staff redundant must run a 45-day consultation before the job cuts are made. As the furlough scheme is slated to end in June, this will force companies to consider their options as early as next week.

Possible ways the government might choose to scale back the scheme include reducing the wage subsidy to a level lower than 80%, or reducing the £2,500 cap on monthly payments.

Prime Minister Boris Johnson is expected to outline further plans to roll lockdown measures back this Sunday.

RS Components looked at some of the world’s richest women who saw net worth increases between 2018 and 2019 to see how long it took them to earn your wage. So which females are leading the way in business?

At aged 72, Diane Hendricks is the richest self-made woman with a net worth of $6.3 billion. Diane made her billions as Chairman of ABC Supply, a wholesale distributor of roofing.

Her hourly earning is $91,324 which is $34,808 more than the US average yearly salary.

It would take the richest self-made woman 37 minutes to earn the US average salary of $56,516 and just 28 minutes to earn the UK average salary of £35,432.

Thai Lee is the second richest self-made woman with a network of $2.1 billion and earns $1,369,863 per day, which is 24 times more than the US average yearly salary.

Thai is the CEO of SHI International, a leading IT provider which she founded in November 1989 aged 31.

The youngest self-made woman is Kylie Jenner who earns $190 every minute. Aged just 22, Kylie is already worth $1 billion. She launched her successful cosmetics company, Kylie Cosmetics in 2015.

How does your salary compare to the richest self-made women? Use RS Components’ new interactive tool to find out how long it would take them to earn your salary.

According to Lucy Franklin, Managing Director of Accordance VAT, this is disappointing, and has prompted responses ranging from outrage about the results to despair about the process, with a healthy dose of weak excuses thrown in for good measure.

In the criticisms and reporting, we run the risk of getting mired in the process, not the impact. Gender Pay Gap reporting represents an immense opportunity to identify if and where there are issues within a business. Visibility is the first step towards progress – and the gender pay gap is an issue we need progress on.

That said, I know that adopting new reporting obligations can be onerous – finance is full of filing and submissions, and Accordance is no stranger to mandatory deadlines. But in this instance, the benefits outweigh the administrative burden. Gender pay gap reporting offers the potential to identify, at every level of a business, where inequalities lie. Whilst this may appear a redundant statement, the lack of progress in gender equality in the workplace over recent decades can attest to the necessity of an issue being recognised, being visible, and being acted on.

This is why Accordance has made the decision to publish our gender pay gap statistics, despite being well beneath the legal threshold for reporting. I want Accordance VAT to play a role in changing a historically male dominated sector. Finance and professional services companies boast a huge number of talented, bright, determined women. Many of these women have great careers in support functions, but those shouldn’t be the only avenues open to them. Financial and professional services organisations are unfortunately disproportionately dominated by men in the more senior positions, and this needs to change. Reporting on our Gender Pay Gap may not affect the systemic issues, but it is a step towards addressing inequality more widely as well as setting the bar for other businesses. We want to lead the way in our sector, and that means voluntarily putting ourselves forward, celebrating our successes where we find them but being the first to highlight where progress is needed.

Publishing our results is just the first step. Having identified that our mean pay gap sits at 12.8% and our median pay gap at -3.5%, we know that we’re doing better than some of our larger competitors in the sector, but we can do more. Publishing our figures shows our commitment to tackling this gap, as do the range of measures we have put in place around recruitment, training, job shadowing, and progression policies. These policies don’t just relate to gender diversity, but also diversity in terms of ethnicity, culture, physical ability, health and mental health.

Fundamentally, greater equality in our sector is about much more than just an improvement in statistics. Finance drives the world – and thus has a significant impact on how lives are led. We need to attract the best and the brightest minds shaping this future – and we need people from different walks of life with a seat at the table. Women need to be as key as men in determining the shape and course of finance, and how it affects economies and shared futures. Again, publishing our statistics cannot affect global trends and practices, but it does demonstrate our commitment to equality, and our determination to reshape the sector we work in.

I urge other businesses below the threshold to join us – to publish statistics for staff and for the wider world, and to identify where progress needs to be made. Reporting and publishing on the picture of an organisation offers an immense opportunity to recognise where problems are, and in doing so shape and improve them for the benefit of everyone. Equality requires commitment and a will to change, but the benefits of a more diverse workforce will be felt both in and outside of the financial and professional services sector.

Homeowners are having to dig deeper than ever before to fund a home move, with the costs associated with buying and selling a home at their highest ever, according to reallymoving’s recent annual Cost of Moving analysis. The total cost of moving home increased by 6% between 2017 and 2018 for the average homeowner, to a record high of £9,812 – equal to one third of the median UK salary of £29,588.

At a time when the property market is stagnating due to uncertainty over the outcome of Brexit and fear of a no-deal scenario, homeowners pressing ahead with a move are facing the third consecutive year of a price increases, which can be attributed to higher stamp duty and conveyancing costs due to a 3% rise in house prices during 2018. On a UK level, taking into account regional rates, stamp duty now makes up almost half (46%) of the total cost of a home move.

Existing homeowners now pay on average £4,500 in stamp duty, an annual increase of 11%. Average conveyancing costs in 2018 were £1,497 versus £1,417 in 2017. Estate agent fees, EPCs (Energy Performance Certificates) and removals costs remain unchanged and surveying costs have risen by just 1%, as providers compete to offer movers the best possible deal in a flat market. Estate agent fees typically cost £2,880 based on a rate of 1.2%, an EPC £55 and a survey £400, while removals, varying considerably according to the volume and distance moved, cost on average £480.

First time buyers see costs plummet

In sharp contrast, first time buyers have seen the costs associated with buying their first home plummet by almost a third (29%) in 2018 to £1,809. This is due to changes to the Stamp Duty Land Tax regime implemented in England in November 2017 which mean first time buyers pay no stamp duty at all on properties up to the value of £300,000. The average first time buyer in 2017 paid £800 in stamp duty, but this bill has now fallen to zero, bringing total moving costs down dramatically.

Tables showing annual change in moving costs for homeowners vs. the average First Time Buyer (FTB)

Table showing annual change in average property prices for homeowners vs First Time Buyers (FTBs)

North/South divide in cost of moving

The cost of moving home in London has now reached £23,039, 2.3 times the UK average. Home moves in the South East, South West and East of England all cost more than the UK average, while in every other region of the UK (East and West Midlands, North East and North West, Wales, Scotland and Northern Ireland) the cost of moving is well below average, as a result of lower house prices. This clear north/south divide means homeowners in the south enjoy far less freedom when making major life choices such as moving home.

Graph shows: Regional cost of moving for homeowners in 2018 (reallymoving)

Rob Houghton, CEO of reallymoving, said: “It’s never been more expensive for homeowners to move, despite the fact that most providers of home move services, such as estate agents, removals companies and surveyors have refrained from increasing prices over the last year as they fight for business from a smaller pool of movers.

“It’s a different story for first time buyers however, who have benefited from a significant fall in the upfront costs of buying their first home due to stamp duty changes. For those first time buyers with a medium to long term view, now could be a good time to buy with costs and mortgage rates low and plenty of sellers prepared to do deals.

“For anyone planning a home move, it’s always a good idea to shop around online for the best deals and compare by ratings and reviews left by past customers, as well as price.”

This follows reports from Personnel Today, which identified a consistent rise in commuting times, with travel times now five minutes longer than they were in 2007. With UK workers losing more and more time to the daily commute – what does this equate to in terms of potential earnings?

Workers of UK could earn an average of £6.29 each day on their commute, which over a year equates to a significant £1,634.40. Based on a full working lifetime of 49 years (16-65), the potential earnings throughout a whole career is a whopping £80,134.60.

The people of London have the potential to earn the most, at £169,639.47 over a lifetime – £13.32 a day, £3,462.03 a year – and those from Northern Ireland have the potential to earn the least over a lifetime, at £58,013.35 – £4.56 a day, £1,183.94 a year.

“It’s not until you crunch the numbers that you can see the staggering financial cost of commuting in UK, and across the whole of the UK,” says Dan Greenslade, Marketing Specialist at Meetupcall. “There is such high earning potential during commutes, we can’t help but wonder whether this research will make individuals rethink how they spend their commute – and perhaps make more productive use of the time.”

“Employers have options too. There are so many developments in technology now that facilitate remote working, allowing staff to cut out the commute entirely, or work flexibly while they’re on the move.”

(Source: Meetupcall)

Pensions are a crucial part of life but a dreaded concept for many millennials. However, saving for a pension may not be as complicated or as demanding as you think. Here, Paul Farrugia, Partner and Chartered Financial Planner at Equilibrium Asset Management, explains how easy it can be to start saving into a pension today.

The disparity in wealth of the world’s political leaders and their country’s citizens varies greatly around the world. Research from credit broker Moneypod has uncovered just how big the political pay gap contrasts with the national average wage of their country.

Due to public anger over income equality, the Singaporean Prime Minister Lee Hsien Loong recently took a 36% pay cut to ease tensions. Despite this, he is still the highest paid world leader, with a $1.7 million yearly salary in comparison to the average wage of a Singaporean sitting at $52,000.

Controversial US President, Donald Trump’s wealth is valued at $3.1bn due to his large portfolio of hotels, resorts and real estate. He earns $400,000 per year for his role as President. However, he donates all but $1 of his salary to charity as the American constitution states that a sitting President must be compensated for his services. This is comparable to the average US citizen earns a relatively comfortable $57,000 per year.

When it comes to the world’s wealthiest world leaders, Russian President Vladimir Putin is the clear frontrunner. Worth a reported $40bn due to his holdings in a secret portfolio of companies in real estate, utilities and banking, Putin is often accused of corruption and enriching is friends. Compared to the average Russian salary of $7,000 per year, Putin lives a lavish life owning a $1bn palace located on the coast line of the Black Sea.

Discover the wages and net worth’s of the top 20 richest paid world leaders, and how this compares to the average wage of their citizens.