Client trends September 2022:
“Back to school” mood

The “back to school” mood means that we’re matching more people to wealth managers than ever this month, with both investment and financial planning related queries coming in thick and fast.

Private bank savings products pique interest

It is plain to see that High Street savings products no longer pass muster (if they ever did) and as a result we’re seeing minds really opening up to what the UK’s private banks can offer.

The failure of big name banks to pass on anything like the Bank of England’s historic interest rate increases has rightly garnered a lot of press attention: it is thought that not one of the UK’s biggest institutions has raised their rates to match the 1.65 percentage point Bank increase seen since the end of 2021 and many will be seeing their money languish at 0.2% – or even less – in easy access accounts.

With predictions that inflation will exceed 18% this year, the risk of wealth being powerfully eroded away has been a feature of many of our conversations with our users

With predictions that inflation will exceed 18% this year, the risk of wealth being powerfully eroded away has been a feature of many of our conversations with our users. Happily, we have been able to tell those who are holding significant cash that they don’t want to put to work in the markets that there are some very compelling private bank savings products available. Two-year fixed term deposit accounts offering 1.65% interest are common – and those with large amounts seeking a new home could seek rates even better than that. If you are looking for an alternative to desultory High Street rates, simply indicate this when completing our wealth manager matching questionnaire.

Advice sought on IHT clawback claims

The injustice of being subjected to Inheritance Tax on bequests, when the reality is that this wealth will have already been taxed a number of times is bitter enough, yet having to pay up 40% to the taxman when the numbers are wrong must be infuriating. Recent media coverage means that we’ve been hearing from users interested in claiming relief because inherited assets have plunged in value.

It is little known, but perhaps predictable, that the Revenue does not actively tell inheritors that they may be entitled to a refund if assets have lost value, but they can indeed seek rebates if they sell the assets within 12 months of the relevant death. According to law firm Boodle Hatfield, around 1,640 taxpayers have to proactively make such a claim each year.

Qualifying investments include shares listed on the main or junior market, government bonds and investment fund holdings

Qualifying investments include shares listed on the main or junior market, government bonds and investment fund holdings, and we have seen some dramatic falls in value in the past year which could mean that some inheritors could be due substantial tax rebates.

There are complexities, however, because HMRC does not allow the “cherry picking” of assets sold at a loss for the relief to be claimed, although there is the option of only selling those which have fallen in value and/or retaining the ones which have risen. As with all areas of tax mitigation, there could be really significant sums up for grabs, but seeking proper advice is essential. Nobody wants to fall afoul of the taxman, so get in touch with our friendly team to hear more about the experts we can connect you with.

Light bulb

Top Tip

One of the real joys of our job is hearing about all the diverse issues that our users are seeking to address, and conversations this month are proving to be particularly wide-ranging. How to access private banks’ infinitely better savings rates, IHT rebates and ESG considerations are just a few of the hot topics which we’ve been hearing about. Whether you are looking to improve your investment or financial planning strategy, or indeed both, we can guarantee that we can connect you to a perfectly matched provider (or, in fact, three to choose from!). Best of all, our matching service is fast and free to you, the user.

Lee Goggin - Co-Founder

Lee Goggin

Co-Founder

Even sceptics are thinking seriously about ESG

The jury is very much still out on how much investors really care about Environmental, Social and Governance factors; some studies suggest that this is a widespread priority, whereas others emphasise that this is really a “nice to have” and that return concerns justifiably remain paramount (although it should be said that ESG investing doesn’t necessarily imply a reduction here). Yet we are seeing that even relative naysayers are thinking about how the global ESG drive needs to be reflected in their portfolios.

The US Senate’s rather interestingly named “Inflation Reduction Act” contains hundreds of billions of funding intended to help fight climate change by subsidising green energy. ESG assets were already predicted to reach $53 trillion, or a third of global assets under management, by 2025; this new bill will undoubtedly put a rocket under the relevant industries.

The ESG sector (if one can call it that) has been beset by concerns about greenwashing – the practice of placing “green labels” on investments which may be anything but

Investors are cognisant, however, that the ESG sector (if one can call it that) has been beset by concerns about greenwashing – the practice of placing “green labels” on investments which may be anything but. So, while there is no shortage of investment providers and advisors keen to burnish their ESG credentials, there is a real need to seek true product quality and expertise. Most of the leading providers on our wealth manager panel have well established ESG capabilities and will be very well placed to help you put an ethical overlay onto you portfolio to whatever degree you wish. We even represent firms which only invest in this way, if ESG is your main driver.

One short questionnaire and you can relax

The holidays may be over, but that doesn’t mean that that summery relaxed feeling has to go away. In fact, by making just one proactive move you can feel more secure and settled in your financial plan for years to come.

That one step is of course seeking professional advice that is tailored to your level of wealth and objectives. Connecting affluent individuals with their best-matched wealth managers, fast and free, is all we do and we have helped thousands of people just like you over our ten years of existence.

Dive right in if you have a clear idea of what you are looking for in an adviser and have a few minutes to spare, or, if you would like some guidance from our expert and unbiased team, please don’t hesitate to get in touch.

Important information

The investment strategy and financial planning explanations of this piece are for informational purposes only, may represent only one view, and are not intended in any way as financial or investment advice. Any comment on specific securities should not be interpreted as investment research or advice, solicitation or recommendations to buy or sell a particular security.

We always advise consultation with a professional before making any investment and financial planning decisions.

Always remember that investing involves risk and the value of investments may fall as well as rise. Past performance should not be seen as a guarantee of future returns.

Find Your Wealth's Paradise

We make the best advisors easy for you to access

Get Started

Find Your Wealth's Paradise

We make the best advisors easy for you to access

Get Started