High inflation continues to affect economies around the world. However, there are positive signs of recovery, and some surveys indicate that people are starting to feel more confident about the future. 

While many things can affect short-term market movements, remember you should invest with a long-term goal in mind. If you have any questions about your portfolio or investment performance, please contact us. 


The UK economy flatlined in February, official data from the Office for National Statistics (ONS) shows. Despite expectations of growth, GDP remained the same.

The 0% growth has been linked to strike action. According to ONS, 348,000 working days were lost to strikes in February. Around two-fifths of strikes were in the education sector and are likely to have had a knock-on effect on other industries too. 

The news led to Fidelity branding the UK the “weak link” among developed economies. The organisation predicts the UK economy will be stagnant for the rest of the year.

The International Monetary Fund (IMF) also said the UK is on track to be the worst performing G7 economy. It predicts GDP will shrink by 0.3% in 2023. While this is an improvement when compared to the previously forecast 0.6% decline, it puts the UK behind other countries.

In addition, the IMF expects the national debt to continue rising over the next five years. It predicts debt will rise from 103% of GDP to 113% in 2028, putting one of prime minister Rishi Sunak’s key pledges at risk.

Despite the negative outlook from organisations, chancellor Jeremy Hunt remains optimistic. He claimed the UK would do “significantly better” than the IMF predictions. 

Inflation in the UK remains high. Despite hopes that the rate of inflation would fall to single digits in March, it was 10.1%. Soaring food prices are a key driver after they increased at the fastest rate in more than 45 years. 

Rising costs mean that workers are facing a pay cut in real terms. According to the ONS, regular pay, which doesn’t include bonuses, fell by 2.3% due to inflation. This could affect confidence and spending. 

High inflation is also affecting businesses. Soaring costs and weak consumer spending has been blamed for insolvencies increasing by 16% year-on-year in England and Wales.

Data from the S&P Global purchasing managers index (PMI) also indicates that despite exports growing, the recovery in the service sector is beginning to slow. 

While there have been challenges, there was positive news for investors too.

The FTSE 100 index posted its longest winning streak since 2020 in April. The index recorded eight consecutive days of increases due to hopes that interest rate rises may end soon.


In contrast to the UK, inflation is easing and there are stronger signs of growth in Europe.

Inflation in the eurozone fell to 6.9% in March. Again, food prices, which increased by 14.7%, are a driving factor for high inflation. 

PMI data also shows the third consecutive month of growth in the eurozone as demand for services picked up. Factory output also increased at the fastest pace in six months as supply chain issues are easing. The data could alleviate some of the concerns that the economic area will fall into a recession.  

However, figures for France demonstrate how high energy costs are still having a significant effect. While manufacturing bounced back in France in February, with an increase of 1.2%, energy-intensive industries have suffered sharp falls. For example, steel production fell by 25.9%. 


US inflation fell to 5% in March, the lowest it’s been since 2021. Despite this, the Federal Reserve said it’s still “far above target”. As a result, it’s expected that interest rate rises will continue in a bid to curb rising costs. 

A consumer index from the University of Michigan suggests that Americans are feeling more confident about the future. The Index of Consumer Sentiment found people are increasingly optimistic about the current climate and their economic prospects. 

However, PMI data suggests that the US service sector unexpectedly slowed in March as demand fell. The dollar weakened following the news.

Despite this, markets rallied in March and gave investors a reason to be optimistic at the start of April. In March, the S&P was up 3.51%, the Dow by 1.89%, and the Nasdaq by 6.69%. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

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

The level of Statutory Sick Pay (SSP) increased in April 2023. Yet, ill workers are still likely to face financial hardships as it provides “very little insurance”, according to a Resolution Foundation report. The findings highlight how important having a financial safety net is. 

As of May 2023, eligible employees will receive £109.40 a week under SSP if they need to take more than three days off work.

While SSP can be useful, it’s unlikely to cover your financial needs.

In fact, according to the report from the Resolution Foundation, SSP is only around 11% of the average salary for a full-time employee. Compare this to the OECD average of 64% of salary. The only OECD countries that ranked lower than the UK are South Korea and the US, which don’t provide any SSP.

In contrast, many other European countries pay either full wages or a percentage of earnings between 50% and 90% for an initial period. This led to the think tank stating SSP in the UK offers “very little insurance”. 

In addition to the low flat rate, SSP is only paid for up to a maximum of 28 weeks. So, if you suffered from a long-term illness or were in a serious accident, it could stop before you’ve fully recovered. 

Thinking about how you’d cope financially if you were forced to stop work due to an illness is important. It not only means you can meet financial commitments, but it can reduce stress at a time when you should be focusing on your health. 

3 valuable steps that could improve your financial resilience 

1. Read your employment contract

Some employers offer sick pay to employees as a benefit. So, your first task should be to review your employment contract to see if you’d be entitled to any support.

Sick pay from your employer may be a proportion of your current salary and cover a set period. For example, you may receive your full salary for the first three months you were unable to work, and then it would fall to half of your salary for an additional three months. 

It’s important you know what would be covered so you can supplement this workplace benefit with other steps.  

2. Review your emergency fund

Your emergency fund is crucial for providing a financial safety net for short-term illnesses.

Having funds to fall back on means you can top-up the money you may receive from your employer or SSP. It can help you to maintain commitments, like paying your mortgage, and your family’s lifestyle if you need to take time off work. 

How much you should hold in your emergency fund will depend on your circumstances. It’s generally a good idea to have enough to cover at least three months of essential expenses in an accessible account. 

3. Check if income protection is appropriate for you

While an emergency fund is useful for short-term shocks, what would happen if you needed to be off work for a long period?

No one wants to think about being involved in a serious accident or suffering an illness that takes months to recover from. But it does happen, and income protection can be valuable in these instances.

Income protection would pay you a regular income if you were too ill to work. This is often a percentage of your usual salary. It would continue to pay an income until you can return to work, retire, or the term ends.

Knowing you have an income you can rely on means you can focus on what matters. 

You will need to pay premiums for income protection, and the cost varies depending on your circumstances and the level of cover you need.

Despite the value income protection can add to your financial plan, it’s often something employees overlook. However, if you couldn’t cope financially with the £109.40 a week SSP provides, can you afford to overlook it?

Contact us to talk to improve your financial wellbeing

If you want to create a financial plan that you can have confidence in, even when the unexpected happens, please contact us. We can work with you to create a financial safety net that reflects your priorities and concerns. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

Note that financial protection plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse. Cover is subject to terms and condition and may have exclusions.

Between 12 and 16 June, Young Enterprise runs a national campaign across primary and secondary schools with the aim to give children the skills and knowledge necessary to understand finances to thrive in later life. 

Taking place every year since 2009, My Money Week has already taught hundreds of thousands of young people how to budget, save wisely, and manage credit card debt. 

My Money Week is the perfect time to teach your children about money and improve their financial literacy. 

So, please continue reading to discover five helpful lessons that could improve your children’s financial independence and ensure they’re prepared for anything life throws their way. 

1. How to manage their money online

These days, most banking is done digitally, so there’s a good chance that the current generation will primarily manage their finances online. 

You could set up an online account for them to use and manage, such as a Junior ISA or current account. This will make it much easier for them to grasp the concept of digital money and how to look after it themselves.

As your children get older, you can set them up with a traditional bank account they can use for online purchases. Then, when you feel the time is right and they’re responsible enough, they can progress to a debit card they can use in shops or at ATMs. 

2. What is debt, and when it should be used

As you may know, it’s easy to feel snowed under when debt starts piling up. So, teaching your children how to manage debt could be a great way to prepare them for the future. 

It may be worth explaining the difference between “good” and “bad” debt. For instance, you should teach them that debt isn’t always bad, such as if they need a mortgage to buy a house that is likely to appreciate in value. 

Meanwhile, you can teach them that “bad” debt is when they spend outside their means, perhaps on non-essential items, such as a new TV or expensive clothing. 

This could also be the perfect time to warn your children about credit card debt and “buy now, pay later” schemes. You can explain that these forms of debt often have uncompetitive interest rates and that credit card debt that they don’t pay off quickly can soon spiral. 

To help your child distinguish between good and bad debt, you could teach them the difference between “wants” and “needs”. Encourage them to ask themselves: is it really worth getting in debt for this purchase?

3. The importance of saving early

Getting a child into healthy saving habits early can instil good behaviours for later life.

An easy way to start is to open a savings account for your child or buy them a piggy bank to keep their pocket money in. This could encourage them to save for things that appear expensive in relation to the money they receive each week or month, but affordable if they save over the long term.

This could also lead to helpful conversations about what to do with additional sums of money they receive – such as for birthdays or Christmas. Teaching your children the importance of early saving could help them develop healthy saving habits as they age. 

4. The power of compounding interest and returns

Einstein once reportedly described compounding returns as the “eighth wonder of the world”, and for good reason. As such, it’s worth teaching your children about the power of compounding returns and the effect on long-term savings. 

Granted, this can often be a tricky subject for younger children to get their heads around, so it may be worth teaching them in the form of a game. One such activity is the “bank of treats” game. Simply give your child a small amount of money, and tell them to put them in their “bank”.

After a short while of saving, you can add more cash to their “bank” to show them how delayed gratification could earn them more in the long run. When your child understands just how powerful compounding returns can be, they may be more eager to save.

While teaching your children about compounding returns, it may also be worth mentioning how high interest rates can quickly escalate debt levels on unsecured borrowing, such as credit cards. 

5. The idea of “earning to spend”

In many cases, to spend money, you first need to earn it. This is an unavoidable fact of life, so reinforcing this with your children as early as possible could be a great way to develop their financial literacy. 

You could get your child to help around the house with chores to earn some, or all, of their pocket money. By doing so, they could come to appreciate the value of money and hard work.

Then, when your child is old enough, you could encourage them to get a part-time job to increase the amount of money they save. 

Get in touch

Helping your child to improve their financial literacy can help them in later life. If you want to explore ways of building a fund for your child or grandchild, we can help.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

Each year in June, Citizens Advice runs a two-week scam awareness campaign, aptly named “Scam Awareness Fortnight”. The organisation hopes its movement will raise your awareness of common scam tactics, and mean you’re confident that you know what to do if you spot one.  

This fantastic campaign comes at a convenient time, as investment scams have been on the rise in recent years. Indeed, FT reports that calls to the Financial Conduct Authority (FCA) related to investment scams have nearly tripled over the last five years. 

Unfortunately, the pressures caused by the cost of living crisis have created the perfect environment for scammers to foster false hope and tempt you towards investments that are too good to be true. 

So, what better time to read up on investment scams and protect yourself from them than Scam Awareness Fortnight? Read on to discover four tell-tale signs of scams, and what you should do if you spot a dubious investment opportunity. 

1. They offer “guaranteed” returns

One red flag to keep an eye out for is the promise of “guaranteed returns”. In the world of investing, it’s rare to find an opportunity that offers high or guaranteed returns for minimal risk.

In fact, the opposite tends to be true – low-risk investments typically offer slower-paced returns. Of course, past performance isn’t a reliable indicator of future performance.

If “get rich quick” opportunities did exist, it’s likely that everyone would be investing in them. So, a tell-tale sign of a scam is when an investment seems too good to be true. 

2. They pressure you to make a quick decision

Another common tactic of scammers is to use high-pressure sales tactics to force you to make a decision quickly. “Maybe” won’t be a suitable answer, and the scammer will likely be persistent in persuading you to invest. 

The scammer may also not agree to you calling them back after you’ve mulled over the opportunity – they’ll likely either demand an immediate decision, or offer to call you back after a brief period of consideration.

They may even tell you that the investment is a short-term opportunity that others have already reaped the rewards of. Scammers will try to pressure you into making a quick decision as you may be more likely to take a risk on impulse. 

Or, if the scammer believes you seem wary of an opportunity, they may offer you bonuses or one-off discounts that make the investment seem even more alluring. 

3. The investment opportunity may seem “unusual”

When the scammer presents you with an “unmissable” investment, some features of the opportunity may seem unusual and start ringing alarm bells. 

For instance, the details provided about the opportunity may be vague. Scammers typically use lots of jargon to confuse you and tend to focus on the headline figures promising high returns rather than the fundamental features of the investment opportunity.

Suppose the opportunity has aroused your suspicion and you ask to see a website to confirm the company’s legitimacy. In this case, they may give you the address for a website that doesn’t have the details of its “once in a lifetime” offer. 

4. The scammer may contact you out of the blue

It’s highly unlikely that a legitimate investment company would cold-call you out of the blue to offer you an investment opportunity. So, if you’re contacted unexpectedly by someone offering you an “exclusive” investment, you should be wary.  

These days, scammers will typically attempt to contact you by phone or email. However, you should still be vigilant of being approached with investment opportunities on your local high street or even by someone knocking at your door.

And, when they do manage to get through to you, the scammers may attempt to ingratiate themselves with you. They could start asking about your family and any future financial plans you have, then use this information to empathise with you and reassure you that the opportunity is legitimate. 

What to do if you think you’ve spotted a scam

Ensure that anyone who offers you an investment opportunity is legitimate

You can ensure that a company or individual offering you an investment opportunity is legitimate in several ways. For instance, you can search for the name of the company on the Financial Services Register, which is provided by the Financial Conduct Authority (FCA). 

This is a database of all FCA-authorised companies, and if you can’t find the firm offering you the investment on this register, it may be wise to avoid it altogether. 

Be on your guard

Before you make any sort of investment, you should ideally set a firm rule that you won’t be tempted by any unsolicited opportunities. 

It’s worth sticking to this rule at all times; if you’re called with an investment opportunity, hang up the phone immediately, or refuse to respond to a text or email. By doing so, you could deter even the most persistent scammer. 

Talk to an expert before investing

Perhaps the best way to protect yourself from investment scams is to speak with a financial expert you trust before you invest.

You could reduce the risk of falling victim to a scam by working with us before making an important financial decision, such as transferring your pension or paying a considerable sum of money towards an investment. 

Get in touch

If you believe you’re being targeted by investment scammers, or fear you’ve already been the victim of a scam, then we can help.

Please contact us for expert guidance on how you should approach the situation. 

Please note:

The value of your investments (and any income from them) can go down as well as up, and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

In a bid to encourage early retirees back to work, chancellor Jeremy Hunt unveiled several changes to pension allowances during the Budget. The announcements could mean you’re able to save more in your pension and boost your retirement income. 

Here are the four key pension changes Hunt announced. 

1. The Lifetime Allowance will be abolished 

Previously, the Lifetime Allowance (LTA) has limited the amount of pension benefits you could tax-efficiently build up in total. Those that exceeded the allowance could face an additional tax charge when they accessed their savings. In the 2022/23 tax year, the LTA was £1,073,100. 

It meant that some savers stopped pension contributions or even retired early because they didn’t want to cross the threshold. 

For the 2023/24 tax year, the charge for exceeding the LTA has changed to 0%, and it’s expected the government will abolish the LTA in April 2024. So, if you were nearing the LTA threshold, you could add more to your pension without worrying about paying more tax. 

2. The Annual Allowance has increased to £60,000

While the government is scrapping the LTA, the Annual Allowance will remain in place. However, the maximum amount you can save into a pension tax-efficiently each tax year will rise from £40,000 to £60,000. 

This means you can place up to £60,000 (or 100% of your annual earnings) and receive tax relief on your contributions. Tax relief is given at the highest rate of Income Tax you pay, so it could provide a welcome boost to your retirement savings. 

As a result, it’s worth reviewing your current pension contributions and calculating if increasing them could make sense for your financial plan. 

3. The Money Purchase Annual Allowance is now £10,000

If you’ve flexibly accessed your defined contribution (DC) pension, you may be affected by the Money Purchase Annual Allowance (MPAA). 

The MPAA reduces how much you can tax-efficiently save into your pension. As retirement has become more flexible, the MPAA is affecting more people. It may affect workers who use their pension to create an income during a career break and then return to work, or those that have semi-retired and want to continue adding to their pension.

During the Budget, Hunt announced the MPAA would rise from £4,000 to £10,000. So, if you’ve taken an income from your pension, you may now be able to save more tax-efficiently.  

4. The amount high earners can tax-efficiently save has increased 

The amount high earners can tax-efficiently save into their pension is affected by the Tapered Annual Allowance. This allowance has now increased from £4,000 to £10,000. 

The “threshold income” for the Tapered Annual Allowance has also increased from £240,000 to £260,000. 

The amount you could tax-efficiently save into a pension falls by £1 for every £2 your income exceeds the threshold for the Tapered Annual Allowance. It can fall by a maximum of £50,000 to £10,000.

The changes mean that high earners will now be able to contribute more to their pension tax-efficiently, and some may no longer be affected by the Tapered Annual Allowance.  

Should you increase your pension contributions in 2023/24? 

The changes announced in the Budget mean many workers could tax-efficiently contribute more to their pension in 2023/24. So, should you increase your contributions?

There are many reasons why adding more to your pension makes sense. It’s a way to invest in your future and could mean you enjoy a more comfortable retirement. As you could receive tax relief on your contributions and investment returns are free from Capital Gains Tax, a pension could be a valuable way to invest for the long term.

However, you should keep in mind that pension contributions aren’t usually accessible until you are 55, rising to 57 in 2028. As a result, you couldn’t make a withdrawal to cover emergencies or other outgoings before you reach retirement age. 

If you are thinking about increasing your pension contributions, you should review your wider financial plan to balance short- and long-term goals. 

Contact us to create a tailored financial plan

A tailored financial plan could help you reach your retirement goals, whether you’re close to the milestone or it’s still years away. Please contact us to arrange a meeting and discuss what steps you could take to get on track for the retirement you want.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future results. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts.  

Retirement planning is a way to ensure that you can generate an income that supports the kind of lifestyle you lead in later life, whatever that looks like.

While your pension is likely to provide the foundation of your income during retirement, fears about inflation and volatile markets are encouraging people to look for alternatives, and you may be considering property. If so, you’re not alone.

According to FTAdviser, 25% of savers plan to invest in property as an alternative way of generating income in retirement. You often see news stories about record-breaking house prices so many people see property as a viable investment, and you can also potentially generate income by renting it out.

However, there are certain additional costs and tax implications associated with property that you need to be aware of. It is important to consider your personal retirement goals to determine which option is best for you.

Read on to learn the potential benefits and downsides of investing in property.

Property prices increased 6.3% in the year to January 2023

According to MoneyAge, the total value of UK housing stock hit a record high of £8.68 trillion at the end of 2022. Naturally, you may be interested in property because it’s more valuable than ever and historically, prices have increased. 

Data from the Office for National Statistics (ONS) shows that house prices rose an average of 6.3% in the 12 months to January 2023. While past performance can’t tell us what the future holds, this is a healthy annual return and, if you invest your money in property, you benefit from the potential for capital growth. 

Equally, of course, property prices could fall and your investment could lose value. As the ONS report, on a seasonally-adjusted basis, the average UK house price decreased by 0.6% in January 2023, following a decrease of 0.4% in December 2022.

One of the other issues with property is that it is generally a less liquid asset than cash or savings. It’s usually relatively easy to access funds tied up in savings accounts, funds or shares, whereas you may have to either sell a property or borrow against it to raise capital – both of which can take weeks or months to conclude.

Buy-to-let properties cost an average of £3,134 a year to maintain

The income generated by renting out property is often the thing people point to when considering it as a retirement strategy. Demand for rental homes has historically remained strong and, as such, you may be able to earn a healthy income with a buy-to-let property.

According to Property Data, the average rental yield in the UK – your annual rental income divided by the total value of the property – is 4.75%. But in some areas, it can be much higher than this. For example, the NG7 area of Nottingham has the best returns in the UK with average rental yields of 11.3%.  

While the rent may generate an income for you, the maintenance costs associated with buy-to-let investments could negate some of this.

A study from LV= found that landlords spend an average of £3,134 a year on their buy-to-let properties. 

If you don’t have a tenant in the property – commonly called a “void period” – you may have to absorb these costs yourself as you won’t have rent payments to cover them.

Additionally, borrowing to purchase a buy-to-let property can be more expensive than borrowing to buy your own home. According to Money Helper, buy-to-let mortgages usually have higher fees and interest rates, and often require a minimum deposit of 25% of the property’s value. So, you will likely need a larger lump sum to invest in property. 

There may also be additional costs including: 

  • Stamp Duty Land Tax (if the property costs £40,000 or more) in England and Northern Ireland – this includes an additional 3% on top of the normal rate because it is a second home. There are similar taxes in Wales and Scotland
  • Estate agent, solicitor, and conveyancing fees
  • Insurance
  • Refurbishment costs.

You may need to factor these costs in when deciding if property is a suitable way to fund your retirement.

Property may be less tax-efficient than other options

Tax efficiency is an important part of retirement planning. If you can find ways to reduce your tax burden, that ultimately means you keep more of your savings or income, it may be easier to achieve the lifestyle you want in retirement. It may also mean you can pass more of your wealth on to your family.

If you own property outside a limited company, you are normally liable to pay Income Tax on rental profits, and if you sell the property, you could pay Capital Gains Tax (CGT) on any value growth. 

Property, whether it is your home or a buy-to-let investment, is also normally considered part of your estate for Inheritance Tax (IHT) purposes. If the total value of your estate, including any properties, is above the IHT nil-rate bands, your family may be liable to pay IHT.

Get in touch

If you want to explore your options for generating an income in retirement, get in touch and we can advise you.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.

Buy-to-let (pure) and commercial mortgages are not regulated by the FCA.

Think carefully before securing other debts against your home.

Statistics suggest that some of the pressures facing economies, such as high inflation and recession concerns, are starting to ease. However, there is still a risk that economies could fall into a recession in 2023. Read on to find out what influenced the markets in February 2023. 

As an investor, remember to focus on your long-term goals when making decisions. Volatility is part of investing, and you should ensure that any investment matches your risk profile. 


Official figures for the end of 2022 meant the year started with some good news – the UK narrowly avoided a recession.

GDP in December declined by 0.5%, but this was offset by gains in the previous two months. A technical recession means an economy has contracted for two consecutive quarters. As the UK economy contracted in the third quarter of 2022, there was a recession risk. Investors should still be prepared for volatility though, as economists are predicting a recession this year. 

The Bank of England (BoE) also believes the UK will face a recession, although it expects it to be shallower and shorter than previously forecast. The BoE predicts economic output will fall, from peak to trough, by less than 1%. This compares to more than 6% during the 2008 financial crisis and 3% during the 1990 recession. 

After a year of high inflation, it is starting to ease and fell to 10.1% in January. The figure is still much higher than the BoE’s 2% target, so it’s not surprising the central bank increased the base interest rate to tackle the rising cost of living. 

The BoE’s Monetary Policy Committee voted to increase rates from 3.5% to 4% – a 14-year high – and cautiously said it believed the peak of inflation was now behind us. 

One of the key factors continuing to drive inflation is high energy prices. So, energy firms announcing huge profits has led to criticism and calls for further windfall taxes. In February:

  • Oil giant Shell reported earnings of almost $40 billion (£33.2 billion).
  • BP posted record profits of almost $28 billion (£23.2 billion).
  • The owner of British Gas, Centrica, reported its profits tripled to more than £3 billion. 

The cost of living crisis has led to nationwide industrial action. The Office for National Statistics found that more than 840,000 working days were lost due to strike action in December. During February professionals from teachers to Border Force staff participated in strikes.

There could be some good news for workers struggling because of the rising cost of living. Research from the Chartered Institute of Personnel Development found that 55% of recruiters plan to lift pay this year to improve staff retention and hiring. 

Data suggests that many businesses are still facing challenges:

  • The S&P purchasing managers’ index (PMI) for the manufacturing sector found it has contracted in the six consecutive months to January. However, the pace of the downturn slowed when compared to December. 
  • The UK service sector suffered its worst month in terms of output in two years as both consumers and businesses cut back their spending.
  • Figures from the Insolvency Service show insolvencies jumped 7% year-on-year in January. When compared to the start of 2020, just before the pandemic hit, insolvencies are 11% higher. 

Despite reports showing there are still obstacles ahead, the FTSE 100 reached record highs during the month. At the start of the month, it surpassed the previous record set in May 2018, which was then beaten several times during the next few weeks. 


Similar to the UK, the European economy narrowly avoided a technical recession at the end of 2022. The European Commission (EC) expects the final growth figure for 2022 to be 3.5%.

An S&P Global report also indicates the eurozone economy grew for the first time since June 2022 in January. The reading lends weight to the hope the bloc could avoid a recession as companies report higher levels of business activity.

Looking to the year ahead, the EC expects Ireland to lead the recovery. The country is forecast to grow by 4.9% in 2023 following last year’s estimated annual growth of 12.2%, which made it the fastest-growing economy in Europe. 

In contrast, Germany, which is often deemed the powerhouse of the EU, could face challenges. Signs suggest the country could fall into a recession after industrial output fell by 3.9% in December. This fall is linked to high energy prices, with output from energy-intensive industries falling by 6.1%.

Inflation remains a key challenge in the eurozone, but, again, it is easing.

In January inflation was 8.5%, down from 9.2% a month earlier, according to Eurostat. High energy costs, which increased by 17.2%, are still driving the rate of inflation.

After increasing interest rates by 50 basis points, the European Central Bank said it will “stay the course in raising interest rates significantly at a steady pace”. So, households and businesses should expect further rises throughout 2023. 


The US also beat recession fears after GDP increased by 2.9% in the final quarter of 2022.

However, the PMI data indicates businesses are still facing headwinds. Output declined at the start of 2023, driven by a sharp contraction in new orders and subdued sales from both domestic and export markets. 

Despite this, job figures indicate businesses are feeling optimistic. The US job market added 517,000 jobs in January, far surpassing the 185,000 economists predicted. 

Like Europe, inflation is slowing in the US. The cost of living increased by 6.4% in January. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

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

The decision to take out financial protection is often triggered by significant life milestones. However, research suggests that the cost of living crisis and changing lifestyles mean many families are overlooking the importance of a financial safety net. 

Financial protection can provide you with money when you need it most. When it would pay out will depend on the type of financial protection you choose, but it could include if you’re unable to work due to an accident or if you’re diagnosed with a critical illness. 

The payout can mean you’re able to meet immediate or long-term financial commitments if your income stops. It can also give you financial security so you can focus on what’s important, like recovering from an illness. 

A third of under-35s say the rising cost of living is preventing them from getting on the property ladder

People often first think about financial protection when something in their life changes, including reaching traditional milestones. However, changing goals and lifestyles coupled with the rising cost of living means that many millennials are skipping or delaying these events. 

Purchasing a home is often a common trigger for seeking financial protection. It’s easy to see why – a mortgage is normally the largest loan you’ll take out and it’s a huge financial commitment. According to a report in Professional Adviser, 1 in 5 people that have taken out life insurance did so when they purchased a property with a mortgage. 

However, the cost of living crisis is affecting the age younger generations are becoming homeowners.

Almost a third of people under 35 said the rising cost of living has already stopped them from getting on the property ladder. A similar proportion also said that rising costs have either prevented them or will prevent them from moving out of their parents’ house. 

So, many people are missing a key trigger that would lead to them thinking about financial protection. 

Other life milestones may also be triggers for thinking about long-term financial security, such as getting married or starting a family. Again, these milestones are something younger generations are doing later in life or missing altogether as lifestyles change.

According to the Office for National Statistics, the average age to get married has been increasing since the 1970s – it’s now around 38 for men and 36 for women. 

Similarly, the Professional Adviser report also found that 3 in 10 people under 35 are delaying starting a family because of the cost of living crisis. 

If a financial shock could affect your plans, protection could provide security 

While life milestones have traditionally led to people seeking information about financial protection, that doesn’t mean it can’t add value in other circumstances.  

You may not have a mortgage, for example, but you could still face significant financial commitments, including rent. Or you may not have children, but want to take steps to ensure your partner would be financially secure if you passed away. 

If you could struggle to meet your outgoings or maintain your lifestyle if you faced a financial shock, reviewing your safety net is worthwhile. It can give you peace of mind and improve your long-term security.

Financial protection could support other steps you’ve taken to boost your financial wellbeing, like creating an emergency fund. 

Which type of financial protection is right for you?

There are several different types of financial protection to choose from. You can also select the deferment period and level of cover. So, it can be difficult to know which option is right for you and the security it would provide over the short or long term. We’re here to help.

Please get in touch if you want to understand how financial protection could provide a vital safety net for you, with your priorities and concerns in mind.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

Note that life insurance plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.

Rishi Sunak is reportedly drawing up plans to provide a “midlife MOT” to assess the financial health of workers and retirees. Taking stock of your finances in your 40s and 50s could lead to greater financial freedom in the future. Read on to discover five initial steps you can take to review your wealth. 

Sunak’s plans are focused on encouraging people to get back to work as employment figures are still not back to the levels they were before the Covid-19 pandemic. Early retirees that gave up work during the pandemic are now feared to be hampering the UK’s economic recovery.

There are also concerns that some early retirees made the decision based on assumptions about their finances before the cost of living crisis. Over the last year, inflation has been high and it could mean some retirees face a financial shortfall now or in the future.

While Sunak’s plans are designed to encourage more people to join the workforce, a midlife MOT can be useful for keeping your plans on track.

Your mid years are often crucial for building wealth that could mean you are financially secure in the future. So, taking stock now is a worthwhile task.

Here are five areas you should cover in your financial midlife MOT.  

1. Review outstanding debt

Reducing your expenses as you near retirement could provide far more financial freedom. One key way of doing this is to create a plan to reduce outstanding debt.

One of the largest debts you have is likely to be your mortgage. If you can, a plan to own your home outright when you retire can significantly reduce the income you need. Paying off credit cards or loans could also boost your disposable income in the future. 

Having debt, including a mortgage, doesn’t mean you can’t retire, but you should factor repayments into your budget when assessing the income you need. 

2. Assess your savings 

Spend some time assessing your savings and understand if they would provide a safety net if you faced a financial shock, like an unexpected property maintenance bill or being unable to work due to an illness. 

Having savings to fall back on when you need them can provide vital financial security now and in the long term. It means you could weather financial shocks and you don’t have to dip into other assets that you earmarked for other goals. 

As the Bank of England has increased interest rates, it’s worth shopping around to see if you’re getting the most out of your money. 

3. Look at your investment portfolio 

Regularly reviewing your investment portfolio can help you understand how it’s performing – remember to review returns with a long-term view, rather than focusing on how the value of investments have changed over weeks or months. 

It’s also a good opportunity to ensure your portfolio continues to reflect your goals. Changes to your circumstances or aspirations could mean adjustments to your investments make sense. 

If investing isn’t something you’re already doing, it could help you reach long-term goals. 

While investing does involve risk and the value of investments can fall, historically, markets have delivered returns over longer time frames. So, if you’re saving for a goal that is more than five years away, investing could grow your wealth and help your assets keep pace with inflation.

When you invest, it’s essential you consider the level of risk that’s appropriate for you and your circumstances. 

4. Set out your retirement plans

When you think about retirement planning, it may be finances and pensions that come to mind. However, when and how you want to retire are crucial pieces of information if you’re to create a reliable retirement plan.

Set out what your retirement plans are – do you want to phase into retirement by working part-time? Or are you hoping to retire early? 

You should also consider what you want your lifestyle to look like when you give up work. This can be useful for understanding the income you need your pension and other assets to deliver to reach your goal. 

5. Check if you’re on track to reach your pension goal

With a clearer understanding of your retirement plans, you can review your pension – are you on track to have enough to live the retirement lifestyle you want?

It can be difficult to understand how the value of your pension will change between now and retirement, and what the value needs to be to provide financial security. As well as considering what contributions you’ll make, you may also need to consider things like investment returns. So, working with a financial planner here can be valuable. 

Going through your pension now could uncover potential gaps and provide an opportunity to fill them. 

Get in touch to arrange your midlife MOT

A financial review can help you take stock of where your finances are now and the steps you could take to reach your goals. Please contact us to arrange a meeting. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

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

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The value of your investments (and any income from them) can go down as well as up, which would have an impact on the level of pension benefits available. 

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances. Levels, bases of and reliefs from taxation may change in subsequent Finance Acts.  

ISAs are a vital part of effective financial planning for many people. According to official statistics, around 12 million adults deposited money in an ISA during 2020/21. 

Around 66% of these accounts hold cash, while the rest are Stocks and Shares ISAs. In total, consumers added £72 billion to ISAs during the year.

Under current rules, you can add up to £20,000 to ISAs each tax year. You can place the money in a Cash ISA to earn interest, or invest through a Stocks and Shares ISA. ISAs are tax-efficient, so you won’t need to pay Income or Capital Gains Tax (CGT) on the interest or returns you receive. As a result, they can be a useful way to reduce your overall tax liability.

Now, however, a think tank is calling for changes that could make them less tax-efficient. Find out why the organisation wants to change how much you could save in an ISA and whether it’d affect your plans here.

The think tank report proposes a £100,000 cap on ISAs

While there is a limit to how much you can deposit each tax year into an ISA, there isn’t a lifetime allowance. This is what a new report is calling for.

The report from the think tank Resolution Foundation and charity abrdn Financial Fairness Trust calls on chancellor Jeremy Hunt to reduce the total amount people can tax-efficiently save or invest through an ISA to £100,000. 

The report claims this would cut waste and focus the government’s savings policy on getting more people to save, rather than rewarding those that already have a significant nest egg. 

The report found the wealthiest tenth of families own 29% of ISA savings.

Wealthier families are also more likely to benefit financially from using the Lifetime ISA (LISA) allowance. The LISA aims to help first-time buyers save a deposit. Each tax year, savers with a LISA can add up to £4,000 and receive a 25% government bonus. The report estimates that 47% of the £670 million of government support given through LISAs is going to the richest fifth of households. 

The report also notes that ISAs are set to cost £4.3 billion each year in forgone tax revenue by the end of 2023/24. So, how do you benefit from saving or investing through an ISA? 

How much do you save in tax by using an ISA?

How much tax you could be liable for if you moved your savings or investments from an ISA will depend on a range of factors, including your income and other assets.

Savings outside of an ISA may be liable for Income Tax

The combination of the Personal Savings Allowance (PSA) and ISA annual subscription limit means that most people don’t need to consider paying tax on the interest their savings earn. 

The PSA is how much interest you can earn before Income Tax is due. For the 2023/24 tax year:

  • Basic-rate taxpayers have a PSA of £1,000
  • Higher-rate taxpayers have a PSA of £500
  • Additional-rate taxpayers do not have a PSA. 

So, if ISA rules changed, some savers could find they need to start paying Income Tax on interest earned if they exceed the PSA or don’t benefit from it. 

Investments outside of an ISA may be liable for Capital Gains Tax

Investments that aren’t held in a tax-efficient wrapper, such as an ISA or pension, could be liable for CGT. This is a tax you pay when you make a profit when you dispose of certain assets.

Each tax year, you can make a certain amount before CGT is due – this is known as the “annual exempt amount”. For the 2023/24 tax year, you can make up to £6,000 before CGT is due, but this allowance will fall to £3,000 in 2024/25.

The rate of CGT depends on which tax band the gains fall into when added on top of your other income. For 2023/24, the CGT tax rates are:

  • Standard CGT rate: 10% (18% on residential property)
  • Higher CGT rate: 20% (28% on residential property).

As a result, CGT can significantly reduce the amount you make when selling investments. 

So, whether you’re saving or investing, changes to the ISA to implement a cap on the total value could mean some households see their tax bill rise. 

Contact us to create a financial plan you can rely on 

While the government hasn’t announced an ISA cap, you should keep in mind that things can change. It’s important that your financial plan continues to reflect current legislation.

As a financial planner, we’re here to work with you on a financial plan that suits your needs. This includes ensuring you’re up-to-date with changes and understand what they could mean for you.

Please contact us to arrange a meeting. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

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

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.