Not so long ago, the stereotype of old age focused on the negative. Perhaps facing illness or struggling to leave the house. Today, that’s not the reality for many people. It’s common to see people in their 80s and beyond fully enjoying their life.

So, what can you do to reach a ripe old age and still be healthy?

Of course, there’s no guarantee of what will happen, genetics and environment play a role. But that doesn’t mean there aren’t things you can do to boost your health as you get older. In fact, longevity expert Dr Shigeaki Hinohara (who reached the age of 105) attributed his long life to several practices and backed them up with numerous books on the topic.

Whilst you may have spotted longevity tips before that demanded you exercise every day or cut out a food group, Dr Hinohara’s approach is a little more laid-back. In a piece for the Japan Times he said: “We all remember how as children, when we were having fun, we forgot to eat or sleep. I believe that we can keep that attitude as adults too. It’s best not to tire the body with too many rules such as lunchtime and bedtime.”

Instead, his philosophy focused on maintained purpose and drive throughout life. Right until the end of his life, Dr Hinohara kept a diary filled with plans made years ahead, with room for fun amid his lectures and hospital work.

So, what can we do to live healthy, long lives? Luckily, much of it is common sense.

1. Keep active

It shouldn’t come as any surprise that exercise and being active is on the list. Keeping fit and in good shape is essential for health, no matter what age you are. You don’t have to commit to running a marathon or taking up a sport (unless you want to!) but whilst winding down is something to look forward to in retirement, make sure you’re still getting some gentle exercise. It can be as simple as playing outdoors with grandchildren through to joining a club to spur you on.

2. Eat a well-balanced diet

Along with keeping fit, what you put in your body is just as important. We don’t mean going on a fad diet, but getting a healthy balance should be a priority throughout your life. Of course, it’s fine to indulge once in a while but keep things in moderation to maintain health.

3. Don’t forget about keeping your brain active

As we enter retirement, we often start scaling back. For many of us, we’ll be using our brain less when we’re no longer spending time at work. But much like you need to exercise to maintain muscles, your brain is the same. Keeping up with hobbies and working out solutions to challenges in day-to-day life can help you maintain mental agility. Place a focus on learning new things later in life too, it can boost your mental health and be rewarding too.

4. Maintain a schedule

If there’s one key message to Dr Hinohara’s notes on how to live happily in old age, this is it. He attributes keeping busy as one of the reasons he lived so long and giving him purpose long past traditional retirement age. Into his 90s, he continued giving some 150 lectures a year to people from school-aged children to senior business executives. Whilst that might seem a little much for your retirement plans, maintaining a schedule should be on your agenda. Do what you enjoy, whether that’s meeting up with friends, indulging in hobbies or passing on your knowledge to the next generation. 

5. Make sure you get enough sleep

The good news is you probably don’t have to set your alarm to get up every day in your later years, but getting a good night’s sleep is still important. Sleep is essential for many health reasons, from helping us to maintain our weight through to improving memory. Sticking to a routine and getting around eight hours sleep a night can deliver a health boost.

6. Take control of your health

We all know that with old age come ailments that you’d rather be without. Taking charge of your health can help you feel in control. It’s a step that incorporates keeping active and eating a balanced diet, but you should go beyond that. You know your body best and when something worries you, speak to a health professional. For some, old age may mean needing more help with the day-to-day. It may not be something you want to think about but planning the type of care you’d prefer, and how you’ll pay for it, can provide you with peace of mind and ensure your wishes are carried out.

7. Have a positive mindset

Another one of Dr Hinohara’s main points is to focus on the positive. If you read interviews or books written by him, you’ll often notice that he refers to the sense of fun and intrigue we had as children; don’t let that slip away as you enter old age. Happiness really can be the best medicine!  

Criminals are coming up with increasingly sophisticated ways to get you to hand over your money. From fake calls purporting to be from HMRC to emails claiming you’ve not made a TV licence payment, avoiding scams can be a minefield. Being vigilant is essential for protecting your wealth.

Technology and internet access have made our lives far more convenient in many ways, but it’s also given fraudsters more ways to scam you. A look at some of the losses reported by Action Fraud highlights the scale of the problem. 

• Fraudsters targeting people selling items online with fake PayPal emails tricked people into believing items had been paid for so items were sent early. It’s a scam that was reported to Action Fraud over 3,000 times between October and December 2019 alone, though many more could have been affected. Victims reported losing more than £1 million during this time.
• Amazon Prime has become hugely popular for those that love to shop online or use the internet giant’s streaming service. But between October 2019 and January 2020, 571 reports of fraudsters using the brand to get their hands on money have been recorded. A call that claims victims have been charged for a subscription service can lead to the loss of thousands. In total, more than £1 million has been lost to the scam, with one victim losing over £65,000.

How to spot a scam

The problem with spotting a scam is that fraudulent activity is constantly evolving and many of the attempts are hard to spot. Criminals often act fast and exploit an existing vulnerability.

When holiday firm Thomas Cook collapsed, leaving thousands of customers waiting for a refund, it didn’t take long for criminals to take advantage. Within weeks those people began receiving calls and messages about how to get a refund, directing unsuspecting victims to a fake website that requested personal and financial details.

So, what can you do to avoid being scammed?

1. Be cautious of unsolicited calls

An unsolicited call doesn’t always mean it’s a scam, but it’s one of the most common signs. If you’re not expecting to hear from an organisation, proceed with caution. Number spoofing, where caller ID suggests that the criminal is calling from a known number, makes this type of fraud even more difficult to spot. If you’re unsure, hang up the phone and call back. Crucially, criminals may keep the line open even after you’ve put down the phone so your call back will direct to them. Either make another call first or use a different device.

2. Do not click on suspect email links

We’ve all seen examples of fake emails where it’s clear they haven’t come from the company it states, but some examples are far harder to spot. If you receive an email with claims of a shipping order you know you haven’t placed or that you’ve won a prize for a competition you don’t recall, don’t click on the email links. If you’re worried, contact the organisation directly. Telltale signs of a scam email include spelling and grammar mistakes, an email address that doesn’t match the usual one or the design of the email looking unprofessional.

3. Don’t be afraid to ask for verification

Checking the authenticity of who you’re speaking to can be a hassle but it’s a step that can protect your money, whether you’re talking on the phone or digitally. Make sure you do this before handing over any personal details. Genuine companies will understand why you may be concerned and should be happy to help ease these worries by verifying who they are.

4. Check the company or individual you’re dealing with

If you’re not dealing with someone you know, check his or her details online. For financial services firms, the Financial Conduct Authority register can be useful, for others look at Companies House and their website. Do their contact details match what they’re saying (but keep in mind number spoofing)? Is their communication in line with their overall image and brand? If you’re not sure, contact the firm directly.

5. Be cautious of time-limited offers

Criminals will want you to make a quick decision, giving you little time to think or discuss what you’re doing with loved ones. If you’re feeling pressured by time-limited offers, claims a courier is on the way or that you need to act urgently, ask for some time. Fraudsters will be keen to keep communicating with you and may seek to pressure you further. Again, a genuine company will understand why you may want to take some time before making a decision, particularly if it involves parting with money. 

6. Remember, if it sounds too good to be true, it probably is

Finally, it might be a saying that’s repeated often, but it’s one that still rings true. If something sounds too good to be true, take a step back and ask why that is.

What should you do if you’ve been scammed?

If you think you’ve been scammed, the first thing to do is to contact your bank. They may be able to stop unauthorised withdrawals from your account or recover money.

You should then report the crime to Action Fraud. You can fill in a report online, which will give you a police crime reference number and your case will be referred to the National Fraud Intelligence Bureau. Not every case will be investigated individually, but it helps the police build up intelligence about fraud, including who is committing it, the types of fraud and who is being targeted. After being targeted by a con, some victims feel embarrassed and don’t want to report the crime, but it’s not your fault and it can be the first step to justice and you may be able to seek additional support.

If you’d like to report fraud, you can do so here.

Knowing how much pocket money to give children or grandchildren can be difficult. Yet, for many, it’s an important part of growing up and their first taste of handling money.

So, how much should you hand over?

Whilst it’ll be a decision that depends on your financial situation and attitude to pocket money, understanding the average can be useful. According to Charter Savings Bank, the average amount of pocket money children in the UK receive is £13. As a result, the average child receives over £50 each month. In total, parents and grandparents are handing over £11.1 billion every year.

The research found that the amount of pocket money given varied between regions, with children in London likely to receive more than £25 a week, and the age of the child.

Over the years, the average amount of pocket money has gradually increased. It’s partly driven by inflation, but the things children want to purchase with their money has often increased in price too. Whilst you may have spent your own pocket money on sweets or even a toy, today, gadgets and computer games are likely to be high on the list.

Whilst setting the right level of pocket money for you is a personal decision, there are plenty of benefits to receiving it.

1. Getting used to handling money

Simply handling money can help children get used to spending and planning their finances. To begin with, the physical coins or notes can be easier to deal with, as they can see when their funds are dwindling.

As children get older, giving pocket money on a card can also be useful. After all, millions of payments are cashless and we’re moving towards a society where cash is used less. It can be difficult to understand and budget when money isn’t physical, starting as a child can help.

2. Building a sense of responsibility

For many children, being trusted with some money can boost their sense of responsibility and pride. Receiving pocket money is a milestone that many will enjoy. If they’re often asking for toys and sweet treats, they may think twice when it’s the money in their pocket that will be spent.

3. Learning the value of saving

34% of parents and grandparents said they wanted to encourage kids to save. Whether they’re putting money to one side for a gadget they’ve had an eye on or simply for a rainy day, it’s a habit that can last a lifetime. Pocket money can be a valuable way to help children learn the value of saving to reach their goals.

4. Understanding a budget

Some children will receive their pocket money and it’ll instantly be burning a hole in their pocket. If this sounds like your child, it’s a great time to teach them how and why we should budget. Making their weekly allowance stretch for a full seven days can be a challenge but it’s a step that could help them manage their income and outgoings in the years to come.

5. Improving maths skills

Finally, pocket money can provide some practical experience of the skills they’ve been learning in the classroom. Working out what they’ve got to spend and how much they’ll be left with after a purchase can help to improve their maths skills and make is second nature.

Building a nest egg for children and grandchildren

The research highlighted that parents want children to save for the long term too. In fact, almost one in five (19%) insist on keeping some pocket money out of reach from their children. If you agree with this, it may be time to look at ways you can start building a nest egg.

A standard savings account is an excellent option for savings that you may want to dip into in the short term. However, if you hope to save for future goals, perhaps a first car, a deposit for a home or university costs, an account that locks money away may be more suitable.

There are savings accounts that offer higher interest rates in return for locking money away for a defined period of time, say two years. Alternatively, a Junior Individual Savings Account (JISA) can provide an excellent solution. You and loved ones can add up to £4,388 each tax year to a JISA, which is tax efficient.

The child can take control of the account when they’re 16 but won’t be able to make any withdrawals until their 18^th birthday. At this point, they’re free to access it as they wish. If they leave the money in the JISA, it’ll automatically convert to an adult ISA.

If you choose a JISA, you essentially have two options:

• Cash JISA: This is a cash account so the money deposited is protected under the Financial Services Compensation Scheme. The deposits will receive interest, which is typically higher than adult ISA accounts, which isn’t subject to tax. However, interest rates are likely to be lower than inflation, meaning money loses value in real terms over an extended period.
• Stocks and Share JISA: If you’re saving for long-term plans, investing may be an option that’s appropriate for you. It’s a step that can help your contributions grow at a faster pace. However, all investments come with some level of risk and you need to keep this in mind when selecting this option or picking investments. Over a long timeframe, investments can help your savings keep pace with inflation. As the money is in a JISA, returns won’t be taxed.

If you’d like to discuss saving for a child or grandchild, please get in touch. We’ll help you understand how your gifts can be used to give them a helping hand as they reach adulthood.

Please note: 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.

Do you intend to pass on wealth to loved ones? If you want to help children and grandchildren become more financially secure, you need to consider more than just the sum you’ll be giving them. Tax rules may mean you need to think carefully about how you do so, as well as the impact it will have on you.

If you want to pass on a portion of your wealth to loved ones, you essentially have two options: do it during your lifetime or as an inheritance.

There are pros and cons to both these options. Passing on your wealth now means you get to see the impact the money has and, depending on the circumstances of your loved ones, it may have a bigger positive effect on their life. However, on the other hand, it may diminish their inheritance and you’ll need to think carefully about how it affects your wealth over the long term.

Whatever option you choose, efficiency should be considered. After all, you want as much of your gift to go to your loved ones.

1. Use your gifting allowance

When you give a gift, you may think it’s considered out of your estate for Inheritance Tax purposes. However, this isn’t always the case. Some gifts may still be considered part of your estate for up to seven years and could be liable for tax as a result.

Crucially, there are some exemptions that mean gifts are immediately outside of your estate for Inheritance Tax purposes. This includes the annual gifting allowance of £3,000. If you want to give money to loved ones now, you should make use of this. It can be carried forward by a year, so if you didn’t use your allowance last tax year, you could efficiently give £6,000 this year.

2. Write a will

If you’re hoping to leave an inheritance to your loved ones, writing a will should be the first thing you do. Even if you already have a will in place, it may be worth reviewing it.

Having a valid will is the only way to ensure that your wishes are carried out. Despite this, more than half of British adults have not made a will. Not doing so would mean your assets are distributed according to Intestate Rules, which could be vastly different from your wishes. A will may also present an opportunity to mitigate tax.

Ideally, you should review your will every five years and after big life events, such as new grandchildren arriving, marriage or divorce.

3. Use a trust

Another way to potentially take a portion of your wealth out of your estate is through using a trust. A trust can allow you to pass on assets or money to beneficiaries with one or more people, or even a company taking control. It’s an arrangement that can be particularly useful if you want to pass gifts on to children or vulnerable people.

There are several different types of trust and some are subject to their own tax regimes, so you need to fully explore your options before deciding to set up a trust.

Trusts can be complicated and once you’ve made a decision, it may be irreversible. As a result, it’s important that you seek both financial and legal advice before proceeding. Please contact us to discuss if using a trust is an option that is appropriate for you. 

4. Remember your pension

Pensions can provide you with an income throughout retirement. But they may also present you with a chance to pass wealth to loved ones after you’ve passed away.

Money taken out of your pension will be considered part of your estate and, therefore, potentially liable for Inheritance Tax. However, money that remains in your pension can be passed on efficiently.

If you die before the age of 75, the money within your pension will not be taxed at all if it’s accessed within two years. After the age of 75, your beneficiary will be charged Income Tax, which could be far less than Inheritance Tax depending on their personal income.

If you want to leave your pension to a loved one, it’s important to note your pension doesn’t form part of your estate. As a result, it won’t be covered by your will. You should contact your pension provider to complete an ‘expression of wishes’ to let them know what you’d like to happen.  

These four ways to pass money on efficiently aren’t the only options. Depending on your circumstances and goals, there may be other options that are more suitable. Please contact us to discuss your personal needs.

What impact will the gift have on you?

Whilst passing on wealth, tax efficiency is important, it’s also crucial that you measure the impact it could have on your plans and future. For instance, would taking a lump sum out of your wealth now to give as a gift potentially leave you financially vulnerable in later years? Would a planned inheritance be at risk if you were to need long-term care?

You can’t know what’s around the corner but by making gifting part of your financial plan, you can help ensure everything stays on track. Please contact us to discuss how you’d like to financially support loved ones. We’ll help build a financial plan that reflects this, as well as your other goals.

Please note: The Financial Conduct Authority (FCA) does not regulate will writing, estate or tax planning.  

Purpose in life gives you a sense of direction and provides meaning. Having a purpose can improve your wellbeing throughout life, and it’s no different when you’re in retirement. Understanding what your purpose is can make the next chapter of your life more fulfilling.

One of the key elements of financial planning is marrying together your financial means with your goals.

Why is purpose so important at retirement? For many of us, our working life plays a central role in our purpose. The sense of pride you get when working or as you climb the career ladder can mean work becomes a way that we define ourselves. When we meet someone new, one of the first questions we usually ask is; what do you do?

We don’t mean how do you fill your free time with hobbies but how you make a living. As a result, our purpose in life and careers are often entwined for decades. When you retire, you can feel like you’ve lost your sense of purpose whilst you establish new goals and aspirations.

Once you reach retirement, you’ll probably have far more free time on your hands than you’ve ever had before. That means you need to ask yourself; what makes me happy?

Defining your purpose

When we think about retirement, it’s often what we’ll be getting away from that we focus on. Maybe you’re looking forward to avoiding rush hour traffic or tight deadlines. But by focussing on what you’re retiring to, you can start to think about your purpose.

There’s no one-size-fits-all purpose once you give up work. With more free time, you can start to focus on those areas that may have been put on the back burner because your career took up precious time. For some it could include:

• Spending time on your passion projects
• Devoting more time to family and friends
• Getting more involved in social activities and clubs
• Visiting new destinations
• Improving skills or learning something new
• Donating time or skills to charity
• Starting a business

For many people, their purpose in retirement is likely to be a combination of several different priorities. Clearly outlining what’s important to you in retirement can help you create plans and objectives, providing a sense of direction.

When imaging your ideal retirement, it’s easy to focus on the big things. Perhaps a once in a lifetime trip springs to mind. But the day-to-day is just as important; how will you fill your mornings, afternoons and evenings? The plans to spend weekends exploring the local area with grandchildren, afternoons honing your skills on the piano or evenings at a class with friends can help give you a sense of purpose.

Retirement is an opportunity to review what you want and your goals for the next stage of your life. After decades working to save for retirement, it’s well-deserved.

Funding your purpose

Whilst your purpose and goals should be at the centre of your retirement plans, money will clearly play a role.

As a result, it’s important to assess your purpose with your pension and other provisions in mind. Having confidence in your finances means you’re free to focus on what’s driving you and gives your life meaning. Putting together a financial plan might seem like a dull task but it’s one that can make your retirement years more enjoyable and relaxing.

After meeting with us, many people find they’re in a better financial position than they thought. It’s a step that gives them the confidence to pursue dreams without having to worry about whether they’ll run out of money in 20 years’ time. For those that find there’s a gap in their finances, there are often solutions or compromises that can be made to ensure they still have a meaningful and financially secure retirement.

Please call us to discuss your purpose for retirement and how your finances can help you achieve it.

Please note: A pension is a long-term investment. The fund value may fluctuate and can go down, 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, tax legislation and regulation which are subject to change in the future.

Welcome to our latest update on the investment market. We take a quick look at some of the key factors that influenced the stock market in December and could continue to do so over the coming months.

Once again, geopolitical tensions and sluggish economic growth continued to impact investment markets as we headed towards the festive period. But there have been some optimistic signs that there will be opportunities for growth and optimism in 2020.

UK

The big news in the UK in December was, of course, the General Election. On the 12^th December, Britain headed to the polls with the Conservatives securing a landslide majority. The party won 80 seats and celebrated their largest majority since 1987. With a majority now in place, Brexit continues to be one of the key topics for debate. Boris Johnson continues to ‘get Brexit done’.

But a snapshot of the economy suggests businesses are still struggling:

• Economy figures for October were released in December showed zero growth after contracting in August and September. It marks the worst three months in more than a decade
• The IHS Markit manufacturing Purchasing Managers’ Index (PMI) sank to 48.9 in November. A figure below 50 indicates a decline in the factory sector and it’s the seventh consecutive month of contraction, marking the longest run since 2009
• The PMI for the service sector also showed a contraction, this has been limited to Brits being more cautious with their spending. It fell to 49.3, above the initial estimate but still a decline
• Business investment also suggested that confidence is low. It was flat in the third quarter and up just 0.5% on an annual basis, according to the Office of National Statistics
• Despite November traditionally being a bright spot for retailers, that wasn’t the case in November 2019. With Christmas shoppers leaving gift buying until the last minute, retail sales hit a 19-month low

One piece of news that would have caught the attention of investors, was one of the UK’s biggest property funds banned withdrawals. The £2.5 billion M&G Property Portfolio owns shopping centres across the country. The fund blamed Brexit and the retail downturn for its problems. Nearly £1 billion has been withdrawn from the fund in the last year and it’s been unable to sell commercial property fast enough, leading to the ban.

Europe

There has been some good news and figures coming out of Europe in December.

First, German export increased unexpectedly in October, with demand coming from beyond Europe. After several months of recession risk, the 1.2% increase in exports will be welcomed. In line with this, German business confidence increased too, suggesting the overall outlook is improving in Europe’s biggest economy. The Ifo institute showed managers has a brighter outlook for the next six months after rising for the second consecutive month in December.

Despite Germany acting as a stalwart for the EU, there are still concerns. At her first meeting as President of the European Central Bank, Christine Lagarde stated that global uncertainties were weighing on the eurozone, impacting both manufacturing and investment growth.

US

One of the key features impacting the US is the ongoing trade war with China. But for investors affected, there could be an end in sight. Whilst early in the month Trump suggested a trade deal could wait until after the November 2020 election, progress appears to have been made. After more than two and a half years, a deal has been reached and markets lifted as a result.

Under the US-China trade deal, China has agreed to significantly increase its purchase of US agriculture, manufactured and energy products by some $200 billion over the next two years. In return, the US has dropped plans to introduce further tariffs on Chinese imports and has lowered ones already in place.

That’s not the end of trade news in the US though, Donald Trump has hit Brazil and Argentina with tariffs. The president has reinstated tariffs on steel and aluminium from the nations.

Focusing on the US economy, the downturn in manufacturing continues. New orders slumped, leading to the fourth straight month of contraction in November.

Asia

China’s preliminary trade deal with the US has been welcomed. But Beijing also announced it is lowering tariffs on more than 850 important products, making it cheaper for Chinese firms to buy products from abroad. Starting from January 1^st 2020, the move aims to lower trade barriers to support the Chinese economy after growth has slowed to a 20 year low. Items on the list range from frozen pork to high-tech components.

Following six months of social unrest and protest, it’s not surprising that Hong Kong’s economy is set to contract in the final quarter of 2019. The pro-democracy protest has had an impact on the economy, including discouraging tourists from visiting.

Middle East

Saudi Arabia’s state-owned oil monopoly floated on the markets in December too. It’s the biggest IPO (initial public offering) in history, raising $25.6 billion through selling 1.5% of the company. Shares surged 10% when they began trading. Despite the debut breaking records, it didn’t reach the $2 trillion valuation sought. Saudi Arabia has stated the IPO funds will be used to support the economy.

Read our blog for more investment updates.

If you have any concerns about your investment portfolio in light of recent events, please get in touch.