Good Money

12.3.2021

One of the many pleasures of my work is that I meet people from all walks of life who bring different perspectives to their financial planning. Different people will often view money differently too; some want to know that they have just enough for their lifetime while others who have perhaps inherited their wealth or act as an Attorney feel a real sense of responsibility and stewardship to pass their money on or to use it for a specific purpose. What is equally fascinating is the different ways they and we value money and the other elements that make up our lives, be it health, family, work, or those special items that we save up for.

At the end of last year, I listened to the Reith Lectures delivered by Mark Carney the former Governor of the Bank of England and now the UN Secretary-General Special Envoy for Climate Finance. Mark Carney has a real skill for communicating and my observations above came to mind as what he said really chimed with me. In these lectures which I wholeheartedly recommend if you have the time and interest, he looks at how as a society we have come to prioritise financial values over human values and the consequences of this.

It’s true that value and indeed success is often measured in financial terms for example a company’s profit, someone’s salary and the contribution goods or services make to a country’s economy (GDP). These are all essential to make our economy’s function but in isolation they can give money undue power. This single minded vision can also contribute to financial crises, our climate crisis. As my nephew aged 14 commented “so not only have you messed up the planet, but you have messed up the economy too”. I don’t think he is holding me solely responsible but for a number of decades money has been the primary concern at the expense of all else. It seems that our social values have often sat outside the financial markets.

HOWEVER……….. all is not lost as we are seeing a real shift in the role money has to play, which for a number of reasons will be more than a passing phase. This started before the pandemic (yes there was such a time!) and has since been accelerated by recent events. It was driven largely by the climate crises and the targets set by Governments worldwide including the UK’s ambitious target of achieving net zero carbon emissions by 2050 whereby we remove the same level of carbon from the atmosphere as we emit, with a significant reduction to be made by 2030.

Governments are not going to be able to achieve this alone, they will need large corporations, private finance, and the investment markets to all pull in the same direction. Companies will need to adapt and change their practices hugely to ensure they minimise their carbon emissions and operate in a climate friendly way – those that do not will not succeed.

We have also seen in the last year how Governments have prioritised health over the economy. We have come to value those who work in the healthcare sector and parents experiencing home schooling have come to value teachers. We have seen generous displays of civic duty with vast numbers of people volunteering, without them the vaccine rollout would not be the success it is, and many more people are wanting to be active in their community.

We are moving towards an alignment of monetary and social values where we are seeing that the companies who are doing well are those whose purpose is not just to create a profit but also do good for society.

I am lucky enough to have a number of clients in their 20’s and for them this is the norm, they are wondering why we have only just arrived at the party.

Tamsin WesthorpeSo, the future is bright, and we are all making a difference. I hope you have a great weekend, it doesn’t look as though its going to be a good one for gardening. If gardening is an interest the daughter of one of our clients, Tamsin Westhorpe, who is a renowned Gardener has written an excellent book that is providing me with lots of practical tips each month ……. perfect rainy day gardening!

Veronica Devereux - First Female Adviser at Brunel Capital Partners

Veronica Devereux DipPFS
Financial Planner

Budget Week and What is in the News?

05.03.2021

The Chancellor’s self-promotion and prominent position in the Cabinet have led him to be dubbed Dishy Rishi by his admirers. And in the run-up to Wednesday’s Budget, Sunak was hardly camera shy. The 40-year-old posted an almost six-minute-long video on Twitter on Monday reflecting on his past year in No 11 – which has since been viewed more than 700,000 times. Can anyone imagine ‘spreadsheet Phil’ being on Twitter and having a video of himself prior to his last budget. I understand, this has raised eyebrows in Westminster and seen the Chancellor installed as the 5/2 favourite to be next prime minister by Ladbrokes. Sunak has an approval rating of 41 per cent, according to a YouGov poll, making him one of the most popular chancellors in recent years. Watch out Boris. Time to visit the Barber (once they open in April of course).

So, here are a couple of the headliners from the Budget and our thoughts:

  • Income, CGT and IHT Thresholds all frozen until 2026. As far as we can see, nothing in the budget today stops IHT mitigation as we know it. ‘We can still make large tax-free gifts, transfer assets into trust and opt to pay the lower rate of CGT on any gains rather than suffer the death rate of 40% IHT’.
  • Corporation Tax to rise to 25% in 2023. Corporation tax is a tax on profits, not turnover, so it is only a tax on businesses that are thriving. ‘The worst thing we could have had was more changes to pensions or savings legislation, particularly with so many people having to adjust their retirement plans due to the pandemic. So, a tax that puts more burden on successful businesses without impacting ordinary savers or retirees makes a lot of sense.’

These are also very much worthy of a mention, especially as we follow our roadmap out of lockdown:

  • Fuel duty and alcohol duties are frozen.
  • Coronavirus Job Support Scheme extended to September 2021 across the UK (employer contribution of 10% required in July and 20% in August and September).
  • Self Employment Income Support Scheme (SEISS) extended to September 2021 across UK, with those who filed a tax return in 2019/20 now being able to claim for the first time.
  • Stamp Duty Land Tax (SDLT) temporary cut in England and Northern Ireland extended until September 2021. The £500,000 nil rate band will be extended until 30 June 2021 then it will be set at £250,000 until 30 September 2021 returning to its standard level of £125,000 on 1 October 2021.
  • New mortgage guarantee scheme to enable all UK homebuyers to secure a 95% mortgage on properties up to £600,000 – only a 5% deposit needed.

In the News This Week

As you know, I like to add in a few little news stories that have either made me smile or cringe!

In the news this week, we have:

  • Free Trip to the Moon – A Japanese billionaire has invited eight members of the public to join him for a free trip around the moon on Elon Musk’s SpaceX flight. “I want people from all kinds of backgrounds to join,” said Yusaku Maezawa in a video on Twitter. He says the successful applicants will advance “whatever activity” they are in to “help other people and greater society in some way” and be willing to support other crew members who share similar aspirations.
  • Fat Chance – a healthy 32-year-old man was offered a Covid vaccination last week, because in his NHS files he was recorded as being 6.2cm tall and morbidly obese. Liam Thorp, who is in fact 6ft 2ins and weighs 17.5 stone said he had been surprised to be offered the jab months ahead of schedule. So, he checked with his local GP surgery and discovered that as a result of being listed as 2 inches tall, officials believed he had a BMI of 28,000 (or around 1,000 times the UK average.
  • Dolly Parton has been given a Covid-19 vaccine after urging others to follow her example by adapting the lyrics to one of her hit songs, Jolene. “Vaccine, vaccine, vaccine, vaccine, I’m begging of you, please don’t hesitate,” sang the 75-year-old in a video before receiving the Moderna shot at Vanderbilt University Medical Center in Nashville, Tennessee yesterday. Parton has donated $1m (£716,000) to the centre. Great work Dolly!

…and finally, you may remember I did my little obituary to Eddie van Halen a few months ago. For all you cycle fans, you must see this paint scheme for a custom bike which was inspired by the iconic Eddie Van Halen ‘Frankenstrat’ guitar. Firstly, I love the paint job and who would not want to own a bike by the UK bike brand Windymilla. Inspiring!

UK bike brand Windymilla

As always, stay safe, healthy and keep a sense of humour.

Best,

David Buchan

David Buchan
Finance Director

The Diary of Financial Planner aged 51 ¾

26.02.2021

Like most of my colleagues my days are very varied. In my dealings with clients, I keep getting reminded about the fragilities of life. It is impossible to keep some conditions at bay, but I am aware that keeping healthy is important (especially for a long retirement), so I start the day with a run.

Typically, the working day starts by heading into the office to deal with any messages that may have been sent overnight via our portal or email.

Then onto a meeting with my team – Harriet and Katy setting out the priorities for the day ahead. Harriet is my Paraplanner providing technical information/report construction etc. and Katy deals with the wide ranging administrative tasks (and there are many!).

Around 11am I may have the first client meeting of the day. Today with new clients who I had met before and wanted to retire but didn’t know if they had enough to do so. Harriet, Katy and I had worked to gather their information, looking at their ‘wish list’ of what they wanted to do in retirement and how much it would cost. The construction of the cashflow reports takes time but is so key in demonstrating what is possible. On this occasion, it was a privilege to let them know that they could retire. You can ‘feel’ the weight almost lift off their shoulders when you say this and the whirring in the brain and excitement of ‘what’s next?’.

After lunch my second meeting of the day is an Annual Planning Meeting with an existing client. They are in the fortunate position that they have enough income for their lifestyle and have said they don’t want to end up ‘the richest in the graveyard’. During the meeting, we talk about a gifting programme to ensure that the right people get the right money at the right time. Many clients have said that they would far rather gift money now to their family when they need it and get a pleasure out of seeing how the gift can help rather than waiting until they die. This is a good conversation to have and a plan is developed.

Talking to my colleagues we are all looking forward to getting back to having these meetings face to face.

I speak with many clients who have been and are going through different stages in life – especially retirement. This has influenced my own thinking of what life after work could look like for me, of course everyone is different. I have many years to continue planning for this as with a 10 year old in tow, I am aware that demands on my wallet will only increase!

Someone once told me that in terms of travelling I should work from the ‘outside in’ – this means travelling to the furthest countries that I wish to visit during my early years and work my way back closer to the UK, as travel becomes more challenging the older you get.

Another tip I picked up from a GP whose friend was a Geriatrician – his advice was walking every day (at least 3 mph) and get a dog. That’s the second GP who’s advised getting a dog in retirement, and not just for exercise – there may be something in that as our cat tends to just walk from the sofa to his food bowl. You don’t get healthier the older you get – a generalisation I know, but reasonably accurate. In other words, ensure that you do the most physically demanding and fun travel/projects as soon as possible.

All things to consider and I’m sure many more ideas will be relayed to me over the coming years.

Have a good weekend and if you have a dog, enjoy exercising in this spring weather and if you don’t, perhaps think about it!

Neil Pinney
Chartered Financial Planner

There’s always a choice…

19.02.2021

It has been widely reported that Tesla has invested $1.5bn in Bitcoin, which is trading at a record high at the time of writing. The investment is to create a liquid position in Bitcoin as Elon Musk hopes customers will be able to use the cryptocurrency to buy his Tesla cars. All well and good.

However, among all the excitement and interesting articles it dawned on me that there is something that bothers me about cryptocurrencies, but I am not sure why. It is a fascinating story and not for the faint hearted, despite what Mr Musk’s tweets imply. It is certainly not a store of value as “its price volatility at 80% is a dozen times higher than the Euro and sevenfold of the Russian rouble”. It remains a speculative asset and given its current fixed supply is at the mercy of sentiment, good and bad. It is also a dead asset, much like Gold, as it does not do anything, does not produce anything, not even a dividend.

The conclusion is that it is not so much I do not like cryptocurrencies as a commodity, it is that I like other methods of investing better. Investments that actually do something, something that is good and looks beyond short term individual gratification.

The end of the last decade brought with it one of the most difficult years for investors of all hues, but it marked a watershed moment for “Sustainable Investing”, which moved from the periphery to centre stage. The rate in change of investor sentiment has been rapidly supported by more and more high profile financial institutions who have begun to develop a meaningful footprint. There is now a diverse range of providers in the marketplace allowing investors a greater choice in terms of investment style and philosophy.

The performance story is strong for Sustainable funds now with a long term track record for many. Fund houses such as Edentree and Robeco have debunked the whole myth that investors are forced to give up returns to keep their values. Their funds give access to international companies well positioned to forge ahead in the future such as Renova, the Japanese renewable energy generator, which had a strong 2020 after the Japanese government committed to ambitious targets for green energy generation; Siemens Gamesa Renewable Energy, the European wind turbine manufacturing benefitting as the market revalued it in the light of Joe Biden’s victory in the US election …. the list is not endless, but you get the point.

Our IronBright Sustainable portfolios launched in 2020 have hit the ground running and are well placed to deliver on their impact and return objectives. Many of the underlying companies that investors have access to are looking forward to exciting futures: healthcare businesses responding to the need for better preventative solutions; technology companies creating a cleaner, more connected and safer world; companies with strong management teams that have looked after their workforce during 2020 who will emerge stronger and all the others addressing the urgent issues of climate change.

We may all still be locked up, bored rigid, waiting for the vaccine but we can still exert choice and influence about what are money does for us and the world around us. At your next review have a chat with your adviser about the investment options that you now have at your fingertips.

Stay safe and happy and like you we’re all looking forward to a Summer holiday!

Steve Brady

Steve Brady
Director

No two days are the same

12.02.2021

This week, we are happy to introduce you to India Dagger. India is a Client Services Assistant and has been with the firm a little over two years. Here, she shares some of her experiences with the firm and how she spends her typical day.

No two days are the same

When I am asked ‘What do you do for work?’, I often say ‘I work as an administrator for a financial planning company’ because this is the easy answer – but the role of a Client Services Associate (CSA) is hugely varied. As a CSA, I support our paraplanners and financial planners in their client work. I am involved in almost every step of the client journey and am a key point of contact in assisting in maintaining the client relationship.

My favourite aspect of my role is speaking with clients and getting to know them, as well as having the responsibility of assisting with their finances. It is lovely to chat with clients about something other than their ISA or Pension! I also really enjoy the variety the role offers as no day is ever the same and I am often involved in new and exciting projects (such as the new IronBright platform transition and our marketing initiatives).

Before I joined Brunel just over two years ago, I worked in the marketing team for a property developer in Bristol. However, both my parents have worked in financial services for their entire careers and having undertaken work experience with an asset manager in London and a wealth management firm in Bristol this sector has always interested me. I studied Business, Economics and English Literature at A-Level.

My CSA role has helped me to gain technical knowledge as I have exposure to so many different client situations and possible financial solutions. I have learnt so much about financial planning and client service in the relatively short period I have been with Brunel. We have a great team who have been brilliant in helping me to develop my learning and skills.

During the pandemic I have continued with my studies for the Regulated Financial Planning Diploma and have joined our new Trainee Financial Planner program as I aspire to progress through the company to the role of a Financial Planner.Outside of work I enjoy cooking (particularly Asian food) and all things equestrian. My sister and I have ridden for most of our lives and have horses – we love to compete with our local riding clubs. I also enjoy keeping fit, taking our dogs for a long pub walk and socialising with my friends and family. I am really missing the office culture at Brunel and hope we can welcome clients to our new office as soon as possible.

 

 

 

 

 

India Dagger
Client Services Associate

 

Right, time to shine!

5.2.2021

At Brunel we love our team. They are a big part of what we do and what we are about.

In addition to hearing from the Directors in these updates, on occasions, you will be hearing from one of the team, with the aim of introducing themselves and providing an insight in to their role and how it affects our clients. This week, I am delighted to introduce Jamie Havard.

Right, time to shine!

My name is Jamie Havard; a 26-year-old who harks from across the Severn Bridge and works as a paraplanner at Brunel. Aside from matters of financial planning, I enjoy homely cooking, rowing up and down the Avon, and more recently, finding other ways of staving off lockdown-tedium.

I’ve been at the company since November 2019, when I left my role as a statistician at the Office for National Statistics for a career in financial planning. I join you today from behind the scenes to shine some light on the role as Paraplanner within Brunel.

The majority of conversations about my job as a Paraplanner tend to go like this:

“What is it that you do again?”

“I’m a Paraplanner!”

“Oh, that’s great.… but hang on, what is that again?”

From these exchanges, it seems Paraplanning is one of the more unknown roles of the financial planning world. I guess this is quite understandable really given we tend to lurk behind the scenes.

As clients of Brunel, you will have had many dealings with the Financial Planners – the advisory faces of the firm – and the Client Services Associates (CSAs) who contact you regarding implementing and administrating their advice. So where in all of this, do the Paraplanners fit in?

Within Brunel, we work collaboratively with the Financial Planners using our technical knowledge to provide the best outcome for our clients. For example, when a planner advises on the retirement provision of a client, I will start with information gathering to form a picture of our client’s current situation. From there we look at how we can help them achieve their desired lifestyle simulating various scenarios. This all culminates in our recommendation report, so having an eye for numbers as well as words is needed.

A large part of our role involves supporting the Financial Planner by enabling them to spend more time with their clients. Having us paraplanners working solely on acquiring technical knowledge, financial compliance and writing up formal recommendations, enables the Planners to do this.

More recently, I have been attending client meetings to get a better understanding of clients’ needs, and adding more context to the work I do for you.

Alongside my paraplanning role I am also part of “Team Vision” which shines a spotlight on of some of the important issues that affect us as individuals and as a company from sustainability to gender equality.

So, there we go; a brief explanation on what a paraplanner is within Brunel. Now, time for me to scuttle back behind the scenes…

Jamie Havard

Jamie Havard DipPFS
Paraplanner

A New Hope

29.01.2021

Near the beginning of this pandemic, I spoke of a determination within our team to emerge stronger and better both as individuals and as a collective.

This has been an extremely difficult time for many. Some of us have lost friends, relatives and know people that been taken seriously ill. If you’ve been affected in anyway, our thoughts are with you.

At times, it has been a real struggle to get motivated and “Groundhog Day“ has been mentioned in a number of interactions I have had. However, that steely determination I refer to above has been there in abundance and a number of positive things have happened across our whole business.

We have successfully launched the IronBright platform and this is a big milestone for us. Whilst it continues to develop, we are extremely pleased with the way it has gone and initial client feedback has been very positive. I would like to thank the clients who offered to be guinea pigs through the development stage.

Our sustainable portfolios have been built and are almost ready for clients. This is an exciting and important area for us and from the initial conversations with clients, it appears it is an area that resonates with you as well.

We have moved offices in Bristol. Whilst we are yet to fully utilise it, we are looking forward to welcoming our Bristol-based clients to Runway East.

The team have also used this time to improve and develop themselves. A number of exam successes across both of our offices is great to see and can only benefit our business and our clients as the team learn new skills and strive for higher levels of competence and professionalism. Well done to India, Simon, Veronica, Vicky, Jamie, Tom, Louise, Lucy and Sara who have all passed exams.

Believe it or not, we’ve also had our very own wedding as well. Harriet Carss, from the Wells team became Mrs Mayes in December when she married James, a housemaster at Wells Cathedral School. I’m sure you will all join me in congratulating them both.

And so, we are nearly done with January. And breathe.

They – whoever “they“ are – say it’s darkest just before dawn. This isn’t true – it’s coldest just before dawn; the lighting state is influenced primarily by lunar phase and urban light pollution – but it’s a useful way of saying that you shouldn’t be downhearted; that the problems you are having now will pass and soon. With this week’s news that deaths in the UK have surpassed 100,000, we could all do with that.

The evenings are becoming lighter, there are buds on the trees. Spring is coming and with that comes hope.

I have even booked a summer holiday. Wishful thinking maybe, but I have hope.

With very best wishes

Damien Rylett
CEO

2021 – Cause for Optimism

22.1.2021

I hope, despite the unusual circumstances caused by the pandemic, that you managed to enjoy the Christmas break, and I wish you and your families a healthy and happy new year.

So, here we are in Lockdown number 3. On reflection, the first lockdown did not seem to be as bad, probably because it was Spring, and the weather was good and there was an element of uniqueness to the situation. I am sure, like me you are all finding the current position tough and challenging – this does affect us all and I am reminded daily how mentally difficult this is by watching my own sons’ experiences in education, a new career, and the lack of social interaction. I hope you are all finding ways to stay positive and keep mentally stimulated.

As I stand back and look beyond the current situation to the year ahead, there are reasons for optimism.

The development of multiple vaccines means there is now, hopefully, an end in sight to the disruptions we have all experienced over the past ten months. We do not know exactly when the full benefits will be felt and we can return to a more normal life, but I am confident it means the second half of 2021 will be markedly – and positively – different to the first. In Somerset, the feedback I am getting from our clients and my family is the vaccination roll out has gathered pace, with 80-year-olds now having received 2 doses and 70-year-olds now receiving their first injection. Well done to everyone delivering the vaccines!

There are other causes for optimism in the longer term too.

Looking around the world, there are changes taking place which the markets see as opportunities. For example, a new administration in Washington, a new basis for the UK’s relationship with Europe, and greater international commitment to the sustainability of our planet.

2020 was of course a remarkable year. The pandemic is a unique experience that has affected all our lives in different ways and to different extents, and for which there has been no roadmap. Our role has been to be by your side throughout; to guide you through the short-term market fluctuations; and to maintain an eye on the longer-term horizon. I do not underestimate the impact that those fluctuations had on your finances, but I hope you can take assurance from the fact that events bore out our confidence that markets would in due course recover.

I trust you already know this, but we continue to be here for you.

David Buchan

David Buchan
Finance Director

Happy New Year!

15.01.2021

I hope that you managed to enjoy the Christmas break and I wish you and your families a healthy and happy New Year.

With tightening restrictions across the world and not just the UK, it is understandable that our attention is focused on the coming days and weeks, whether it is concerns about loved ones catching the virus or waiting to receive the vaccine, children being able to return to school or a broader sense of life continuing to be interrupted, there remains much to occupy our minds.

From our viewpoint we try and look beyond the current situation and we can see reasons for optimism. The development of multiple vaccines means there is now, hopefully, an end in sight to the disruptions we have all experienced over the past 10 months. We do not know exactly when the full benefits will be felt and we can return to a more normal life, but we remain confident it means the second half of 2021 will be markedly and positively different to the first.

There are other causes for optimism as well. There is a new administration taking over in Washington, a new basis for the UK’s relationship with Europe and greater international commitment to the sustainability of the planet – 2020 will be seen as the start of the great Energy Revolution. IronBright is already playing its part with the launch of the IronBright Sustainable portfolios at the end of 2020.

2020 was a remarkable year with the pandemic; a unique experience that has affected all our lives in different ways and to different extents, for which there has been no road map. Our role as financial planners is to be there for our clients and help when we can to guide you through the short term madness but also to keep an eye on the longer term; events did bear out our confidence that markets would indeed recover, and that short term tactical calls in 2020 would be dangerous to your wealth.

As in 2020 we remain fully operational and open for business in 2021. We continue to work remotely save for a few brave souls that man the office daily, and we remain confident that not before long life will return to something more familiar.

All my very best wishes for the forthcoming year.

Steve Brady

Steve Brady
Director

Magic Money – Can We Print Ourselves Rich?

18.12.2020

So, as we all gear up for Christmas in what has been probably one of the most testing years for a very long time, I thought I would ‘throw’ out of few of this week’s news headlines:

  1. Biden’s victory confirmed by electoral college
  2. Barnier says Brexit deal could be agreed this week
  3. London heading for Tier 3 rules
  4. Gas boilers to be banned within 15 years
  5. Government launches crackdown on social media

Not really a ‘slow’ news week! Let us hope we have a Brexit deal to celebrate before Christmas and a return to a new normal in 2021.

Considering the repercussions of the Covid crisis and the huge sums borrowed by Governments around the world, I am reminded of a conversation I had with a new client a few weeks ago. As my title suggests, I wanted to share with you an alternative theory reported in ‘The Week’ publication after my client discussion (pure coincidence) to increasing taxation to pay for the vast sums borrowed.

Thinking back to my A Level economic classes (many years ago!) I am reminded of John Maynard Keynes, the famous Economist who advocated the use of fiscal and monetary policies to mitigate the adverse effects of economic recessions and depressions. The advent of the global financial crisis of 2007-2008 sparked a resurgence in Keynesian thought. Keynesian economics provided the theoretical underpinning for economic policies undertaken in response to the financial crisis of 2007–2008 by President Barack Obama of the United States, Prime Minister Gordon Brown of the United Kingdom, and other heads of governments.

When Time magazine included Keynes among its “Most Important People of the Century in 1999”, it stated that “his radical idea that governments should spend money they don’t have may have saved capitalism. The foundation to my economics qualification can now be tested with an alternative theory.

The New Theory – in traditional economics the idea of printing money to solve a nation’s problems is near universally seen as a bad one. By contrast, Modern Monetary Theory or MMT – proposes that nations that issue their own currencies can freely create and spend their own money; and that this is a useful economic tool, which need not devalue the currency, create inflation or lead to economic meltdown. In the MMT worldview, the established idea that high public debt is a drag on economies and a burden on future generations is turned on its head. Proponents argue that, on the contrary, private citizens and businesses tend to do better in countries running high levels of government (or fiscal) debt. Taken to its logical extreme, MMT allows high spending without taxes or borrowing – a truly radical idea sometimes derided as the ‘Magic Money Tree’.

As we move towards the Spring budget, it will be interesting to see if Rishi will follow the traditional economic route or embrace this new theory.

On that note, I wish you all the very best for the coming festive season and new year.

David Buchan

David Buchan
Finance Director

Brunel Capital Partners is a sister company of Pilgrim Financial Planning