Financial Planning

Who gets my estate if I die without a will?

By | Financial Planning

Did you know that nearly half of British adults do not have a will? Moreover, millions admit they would not even know where to start if they were to write one. As a financial planning firm here in Oxford, we recognise on a daily basis how important a will is when it comes to preserving your wealth after you die, and passing it down to loved ones according to your wishes.

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Update – April 6th, politics & the IHT threshold…

By | Financial Planning

There are currently some interesting rumblings in the UK regarding inheritance tax (IHT). On the 28 January 2020, a cross-party group of MPs proposed reducing the 40% IHT rate down to 10%. The All-Party Parliamentary Group was set up over a year ago following a request by the Chancellor to review the IHT system, and also proposed that almost all tax reliefs (including the “seven-year gifting rule”) be abolished. Instead, the Group proposed that estates valued over the IHT threshold (£325,000 in 2019-20) face a 10% IHT rate, whilst estates worth over £2m would be taxed at 20% upon death.

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5 Ways a Financial Planner Adds Value

By | Financial Planning

This content is for information and inspiration purposes only. It should not be taken as financial or investment advice. To receive personalised, regulated financial advice regarding your affairs please consult us.

Has anyone ever given you advice which you look back on and recognise as having benefited you in a life-changing way? Perhaps your parent or grandparent imparted a word of wisdom to you which you have clung to over the years, helping you prosper and grow as a person? If so, what kind of price would you put on that?

It’s hard to quantify the value of great advice and wisdom, but we intuitively recognise that it is immensely precious. Here at WMM, our financial planning team has the privilege of working in this realm every day. It’s one of the most rewarding experiences in life to offer wisdom to clients about their financial affairs, which then often transforms their quality of life and future prospects. It’s also hard to quantify in pounds sterling.

What are the precise ways a financial planner benefits you? In this digital world of increasing “self-help” financial coaches and “robo-advisers”, what value can a human financial planner really offer you? In this short guide, we’ll be sharing just five of many possible ways they add value.


#1 Simplifying financial affairs

Many people have highly complex finances. Perhaps you have multiple pensions, and possibly some of them are lost. Maybe you have several old protection policies which are meant to cover you in the event of serious illness, but aren’t sure how they relate to each other or where they need bringing up to date. Or, it could be that you have a complex set of investments which don’t really work well together, are not organised in a tax-efficient manner and which face high fees.

One of the benefits of working with a financial planner is that they can help you sift through all of these various elements. He/she can then start to group everything together in an organised, clear way; identifying areas which can be consolidated to make everything simpler. If you have ten pensions, for instance, a financial planner can help you track them all down and possibly bring them all into fewer more cost-efficient pots.


#2 Illuminating & correcting blind spots

No financial adviser can predict the future, yet they can leverage their qualifications and experience to help you address weak areas in your portfolio. In 2019, there have been a number of funds which have been suspended and have even collapsed, due to terrible investment performance caused by poor fundamentals. One prominent example was the collapse of the Woodford UK Equity Fund, which declined from a high point of £10bn to around £3bn. More recently, we’ve had the M&G Property fund which has had two trading suspensions and delivered weak returns (despite clients paying £100m in fees since 2016). Liquidity problems such as these cannot always be fully spotted beforehand, yet having a financial planner to assist you can go a long way to helping you allocate your investments more strategically – eliminating unnecessary risk.


#3 Giving reassurance

Are you worried about how the economy might affect your investments? Do you currently suffer from anxiety about what will happen to your home if, one day, you need to go into long term care? A financial planner can bring a calm, rational voice and list of facts to these fears. Together, you can then work to put appropriate measures in place which address them. For instance, to help you prepare for the possible costs of your care you might consult your planner about how to build up a sufficient nest egg to carry you through this time. You could also talk through other options you may not even be aware of, such as an immediate needs annuity.


#4 Preventing errors

The United Kingdom has a lot of consumer protections enshrined in law and ways to make an appeal if things go wrong (e.g. the Financial Conduct Authority and Financial Ombudsman). Nonetheless, many people across the country are still vulnerable to sophisticated scams seeking to cheat you out of your savings, pension or investments. Some of these occur during unsolicited calls about a “hot stock” with “guaranteed returns”, but many are increasingly happening online. A good financial planner will be familiar with all of these tactics and can act as a vital information source to help protect yourself. If you are at all unsure about an investment offer presented to you over a cold call, you can run this past your adviser. They can then tell you whether it is legitimate or not, potentially helping you dodge many bullets over the years.


#5 Acting as an impartial sounding board

For many big decisions in life, we often turn to trusted friends and family to “air out” our thinking, to gain their counsel. Perhaps you’re not sure about moving to another part of the country for work and need a second opinion. As precious as these people are, they’re not usually the best to talk to about your pension, inheritance tax planning or investment strategy!

If a decision is weighing heavily on your mind about your longer-term financial affairs, then one of the best things you can do is consult an impartial, experienced professional who understands the intricacies of what you’re talking about. Sometimes it helps just to voice your concerns as they carefully listen. In specific moments, they can ask focused questions which you might not have thought about, often shedding new light on the situation and giving you pause for thought. As you do this over many years with the same financial planner, the better they get to know you, the more you gain a trusted guide. This person could then help other members of your family facing similar worries or questions.


Final thoughts

Here at WMM, we believe there are many benefits to working with a financial planner. However, you still need to ensure that you pick the right professional for your needs. Lots of businesses can look good on paper, but it’s important to also meet different financial planners to establish trust and chemistry.

When it comes to your investments, also make sure you ask for the firm’s Investment Policy Statement. This should set out the types of funds or assets they invest in and why. This will give you more insight into their investment approach and philosophy, allowing you to get a better sense of how they would help to manage and grow your wealth.

If you are interested in starting a conversation about your financial plan, then we’d love to hear from you. Get in touch today to arrange a free, no-commitment consultation with a member of our friendly team here at WMM.

Reach us on 01869 331469


Protecting Your Financial Plan: 5 Key Steps

By | Financial Planning

This content is for information and inspiration purposes only. It should not be taken as financial advice. To attain bespoke, regulated financial advice for your own affairs and financial goals please consult one of our independent financial planners.

What would happen to your loved ones if the worst were to happen? It isn’t a pleasant thought, of course, but it’s important to think about this seriously; especially if people are depending on you, such as young children.

Research suggests that as many as 8/10 mortgage holders have no insurance protection. That means that millions of working people are leaving their families vulnerable if they were to suddenly, tragically die. Moreover, as many as 1/3 people admit that if either they or their partner were to unexpectedly become seriously ill and could no longer work, then they would be unable to make ends meet on just one income. Less than half believed that their short term savings would carry them beyond two or three months in such circumstances.

It’s natural for many of us to think that horrible things only happen to “someone else”; not to us. Yet none of us know what life might bring, and it’s important to be as prepared as possible whilst aiming and hoping for the best. In this short guide, we at WMM will be sharing 5 key steps to consider with a financial adviser to help protect your family’s financial plan.


Emergency Funds

Whilst short-term savings are unlikely to carry you and your family through protracted, incapacitating illness, they can certainly act as an important “shock absorber” during difficult circumstances (e.g. sudden redundancy).

Generally speaking, financial advisers tend to recommend that it is sensible to try to accumulate between 3-6 months of living costs, and set these aside as an emergency fund. This can give you enough “breathing space” to find a new job, for instance, or cover a large unexpected bill (e.g. a major roof repair) without it crippling your finances.


Wills & Power of Attorney

A comprehensive financial plan will typically outline how your estate will be handled and distributed when you pass on. The primary way to deal with this is via a Will, which stipulates who should receive your possessions, assets and property, as well as the manner and timing of the handover. Failing to devise a will leaves your estate vulnerable to the UK’s “intestacy rules”, which might not divide your estate in accordance with your wishes.

Creating a will is especially important to think about if you have dependants who might benefit considerably from a meaningful inheritance in the future. Yet it’s also a good idea to consider going a step further and looking into power of attorney. This can enable another trusted person to make decisions about your estate for you, if you are no longer able/willing to make them.


Term/Whole-of-Life Insurance

A life insurance policy is designed to provide a much-needed lump sum to your family if the worst should happen to you. Broadly speaking there are two types: term life insurance and whole-of-life insurance.

The former covers you for a set period, whilst the latter provides cover indefinitely. Naturally, term life tends to be cheaper since whole-of-life insurance is guaranteed to pay out one day. However, the costs for both types of life insurance can vary quite widely depending on several important factors, particularly your state of health and the level of cover required.

There are many policies available on the market and it’s easy to feel overwhelmed, or end up paying more than you need to (sometimes for less cover). As independent financial planners WMM will be able to help you survey your options more widely, and find the ideal product for your needs.


Critical Illness Cover

For many people, critical illness cover (CIC) can feel excessive – especially if we are fit and healthy right now. It’s important to remember that health is not guaranteed, and serious illness can unexpectedly befall any of us, at any time. Having a financial plan which is prepared for this possibility is, therefore, certainly wise.

Even if you are single, CIC could help you cover your mortgage and other monthly commitments if you suddenly found yourself incapable of going to work. For couples (especially those with young children), the lump sum from a CIC policy can help relieve financial pressure from an already difficult situation.

Again, consider speaking to one of our financial planners if you feel that CIC could be an important part of your financial thinking. Sometimes this can be combined with income insurance, for instance, to cover multiple eventualities whilst keeping costs and administrative hassle to a minimum.


Income Protection

Critical illness cover and income protection are quite similar. However, one important area where they differ concerns the “pay out”. The former provides a single lump sum if the terms of the policy are met. Once this money is gone, however, then it’s gone and the policy often ends on pay out of a successful claim. Income protection, however, agrees to pay out a percentage of your salary (e.g. 2/3rds) each month for as long as you are unable to work, due to illness or injury.

Be aware, however, that there are different types of income protection. Some will only pay out for a limited period (e.g. 6-12 months), and many will only cover you up to a certain age.


Final Thoughts

Above, we have outlined some of the main strategies available to those seeking greater protection over their financial plans, and by extension, over the future welfare of their family. Many of these approaches can be combined to provide a bespoke solution for each person, depending on their individual needs and financial goals.

We recommend that you consult an experienced financial planner to help you with this, to ensure that you do not mistakenly “double up” the benefits of multiple insurance policies or fail to provide the level of cover you need. Contact us on 01869 331469 if you would like to discuss this aspect further.


How Do I Create Wealth For My Children?

By | Financial Planning

This content is for information purposes only and intends to inspire your thinking. It should not be taken as financial advice. To receive tailored, regulated financial advice please consult us here in Oxford.

It is very natural for parents to want to give their children a better chance in life. When it comes to building wealth for your children, we at WMM tend to come at this from two angles as financial planners:

  1. Building up wealth with your child gradually, especially through saving and investing.
  2. Passing on wealth to your children one day as an inheritance.

Every family is different with regards to its composition, financial situation and goals. So it’s always best to consider seeking professional financial advice to identify the best options for your particular needs. In this article, we’ll be sharing some ideas on the above two areas which you can discuss with them.

We hope you find these thoughts helpful, and if you would like to discuss your own financial plan with us, please get in touch to arrange a free, no-commitment consultation with a member of our team here at WMM.


Building up Child Wealth

Perhaps you want to give your child a set of financial savings for University one day. Or, maybe you want to start building up their pension, or help them prepare a strong house deposit. Whatever your goals, you are likely going to want to consider some options for efficient saving and investing to help achieve them.

Savings Accounts

One of the best ways to build wealth for your child is to help instil a sense of responsibility for saving for the future. When they are young, this might be as simple as encouraging them to keep a piggy bank which they can build up with pocket money; even if this is as small as 10p. Eventually, you can introduce them to a children’s savings account at a bank or building society, which they can take responsibility for after the age of 7.

ISA’s -including Junior ISA’s (JISA)

An individual savings account (ISA) can be a good step to consider with your child, especially because it helps to educate them about “tax efficient saving”. Remember, in 2019-20 all interest earned within an ISA is tax-free. They can only access the money in an ISA once they reach age 18, but the money still belongs to them. A Stocks & Shares JISA can be a particularly useful account type to consider, since it helps children to learn about the “ups and downs” of investing in the short term, whilst achieving growth in the long term. However, these are not allowed if your child has a child trust fund (CTF).

Child Pensions

In 2019-20 parents can open a pension for their child (such as a SIPP; or Self-invested Personal Pension), and contribute up to £2,880 per year. So, if you opened one shortly after your child’s birth and put in the maximum amount over 18 years, then they would likely have £51,840 in their pension before investment growth is even taken into account. This could give your child a much stronger financial foundation in retirement, but bear in mind that under current pension rules the money will be inaccessible until they reach the age of 55.


Passing on Wealth to Children

The above are just a handful of ways you might help your child financially, whilst you are around and whilst they are growing up. Once they are older and (hopefully) financially independent, how can you continue to support them? Also, what can you do to ensure that as much of your wealth as possible passes on to them when you are no longer around?

Here, it helps to have a strong grasp, ahead of time, of the foundational elements of inheritance tax. After all, the more you know about this early on, the more you can do to better-prepare your estate to pass on tax-efficiently to your children. Here are just some of the important areas you might want to discuss with one of our financial planners:


In 2019-20 you are entitled to pass on up to £325,000 of your “estate” to beneficiaries when you die, without facing inheritance tax (IHT). Your estate includes things like:

  • Property (including your family home).
  • Vehicles
  • Jewellery and other possessions
  • Investments and savings
  • Businesses you own

However, your estate does exclude certain things which are important to be aware of for IHT purposes. For instance, certain investments are exempt such as Enterprise Investment Scheme (EIS) shares which you have held for at least 2 years. Pensions are also excluded.

You can raise your own IHT threshold, however, if you pass on your family home to direct descendants such as children or grandchildren. This allows you to claim an Additional Nil Rate Band of £150,000 in 2019-20.


The above would theoretically mean that a single person could potentially pass on at least £475,000 to one or more children without facing IHT (i.e. £325,000 + £150,000).

If you are married or in a civil partnership, however, then each of you are entitled to your own Nil Rate Band and Additional Nil Rate Band. So, in some cases a married/civil partnered couple could pass on up to £950,000 to their children in 2019-20, free of IHT.

Other Options

These are just two important areas to mention when it comes to passing on family wealth to children as an inheritance. There are many other important strategies available to you which you could discuss with a financial planner, such as leveraging your pension or taking advantage of Annual Exemptions for gifts.

The key point here is that growing wealth for your children involves thinking strategically, both over the short and long term. There is much you can do right now, practically, to help lay a foundation of wealth for your child whilst helping to teach them about the importance of saving, investing and planning for the long haul. You can also prepare you own estate appropriately with a financial adviser to help ensure your wealth goes into the right hands in the future.

If you would like to discuss your own financial plan or estate with a professional financial adviser here in Oxford, then we invite you to get in touch to arrange a no-commitment consultation with our team at WMM, at our expense. You can reach us on 01869 331469.


How to Start Your Own Financial Education: A Short Guide

By | Financial Planning

There is a quote by Natasha Munson which goes: “Money, like emotions, is something you must control to keep your life on the right track”.

As financial advisers here in Oxford, we can attest that this is true. Your attitude and behaviour towards wealth – just like emotions – has a huge impact on your quality and course of life.

One of the keys to bringing more control to your financial future is to try and understand more about money, wealth and financial planning. Think about the comparison with emotions, again, and consider anger as an example. The more you understand about the nature and roots of your anger, the more you can control it. Similarly, the more you understand about financial planning, pensions, mortgages and investments, for instance, the more prepared you will be to leverage money and wealth positively towards your goals.

Although we, of course, exist to advise clients on financial matters, we do not believe you should solely rely on anyone else when it comes to managing your money. It’s important to have a good grasp of at least basic financial concepts (e.g. capital gains, dividends, investment management fees etc.) to ensure that you understand what your adviser is telling you!

This means committing to your own financial education, learning about some of these important financial planning topics for yourself to get the most out of your financial adviser. That does not mean enrolling on a professional financial planning course or taking the equivalent of an undergraduate degree in economics. It simply means using the resources at your disposal to increase your understanding of important financial matters which directly affect you.

In this short guide, we’re going to suggest a few areas where we recommend starting your own financial education – as well as offering some ideas about where you can find the resources you need to find out more on those topics. We hope you find this helpful, and invite you to contact our team here at WMM if you need any further information.


#1 Start at Home

One of the best ways to start understanding more about money and wealth is to look at your own situation, and ask: “What do I earn, and what do I spend?”

This naturally leads you to look at your banking transactions, payslips and perhaps other documents pertaining to your income/expenses (e.g. income you make from Airbnb). You’ll likely notice important information such as your tax code on your payslip, as well as your pension contributions and student loan deductions.

Ask yourself: “What do I know about these things?” For instance, are you aware of the various tax codes out there, and are you sure that you’re on the right one? Do you understand how your student loan payments are calculated, and how your monthly payments might change if your wage increased/decreased? Do you know where all these pension contributions are going, and where all the money is being stored?

Similar questions can be gleaned from your expenses. For instance, how much are your mortgage payments and how is this worked out? What would happen to this monthly figure if you perhaps moved to a better deal (i.e. remortgaging)? Similar questions could be asked of your utilities and other bills.

In other words, starting your financial education “at home” in this way can really be a great motivator to get you going. After all, the more you can understand these specific things, the more chance you have of being able to make improvements to your finances which could have an immediate, positive impact on your quality of life.

Some great resources to get you started on these sorts of topics include the Which? online resources, and the blogs, articles and guides by Martin Lewis on MoneySavingExpert.


#2 Move Out

In our experience, the above process typically leads people to engage in their own, personal process of educating themselves about their own finances (e.g. mortgages, income tax, ISAs etc.). However, at a certain point, the time comes to also look beyond the things which seem more “immediately relevant” to other subjects which might seem more distant – but which are nonetheless still crucially important.

Examples of these sorts of topics might include inheritance tax and estate planning. After all, it’s great knowing more about your current financial situation, but what happens to your money and wealth in perhaps 30 or 40 years, when it might be time to hand this over to either the tax man or your loved ones?

Another important topic is investing. For example, if you want to build up a sizeable pot of retirement money one day, then it’s important to understand how to make money “grow” through investments. This will involve understanding, say, the difference between “saving” and “investing”; what kinds of investments are available (e.g. stocks and bonds); what an investment “portfolio” is and how various factors can influence how your portfolio is put together (e.g. risk tolerance and personal investment goals).

For this stage, we recommend you follow our own blog here at WMM and other helpful resources such as dedicated investment columns in newspapers such as The Daily Telegraph.


Final Thoughts

Finances, money and wealth are vast and fascinating topics. As financial advisers, we have spent many years learning about these areas and serving clients, yet we admit that even financial advisers need to learn continually. This is especially the case since the financial world rarely sits still, and new developments arrive which need to be understood and then communicated to clients when these changes affect them.

We encourage you to not be discouraged as you engage in your own financial education. There is a lot of jargon and much of the language concerns intangible things which can be difficult to grasp (e.g. final salary pension transfers). However, the payoff you get from understanding these things can be considerable when you later can leverage your knowledge to get a better deal on your pension, for instance, or on your mortgage.

If you would like to discuss your financial planning situation with a member of our team, then we invite you to get in touch to arrange a free, no-commitment pension consultation today.


The Road to Financial Security & Confidence After Divorce

By | Financial Planning

Divorce isn’t a happy topic but is an important one if you or someone you know is going through it – especially when it comes to the finances.

It’s common for people to accept that lawyers will likely need to be involved with the divorce process, to sort through issues such as homeownership rights and custody of children. It is less prevalent for people to consider help from a professional financial planner.

Yet getting this help can be hugely important. Divorce not only affects your legal status, your emotional well-being and relationships but also what kind of lifestyle you can afford in the years ahead. Given the huge financial implications, it can be very valuable to get an experienced, dispassionate set of eyes on your financial plan to make sure you are carried forward into the best possible financial future available to you.

Of course, it can be very helpful to consult a financial planner during the process of divorce. However, this is also beneficial once you have concluded the legal proceedings and completed the divorce. Perhaps you are at this stage, feeling like you have just come through a whirlwind of emotions and that only now, have you been able to catch your breath and ask yourself: “Are my finances secure, and do I have enough now and for my future?”

It is quite possible that right now, after what could have been more than a year of divorce proceedings and paperwork, that you simply want to step back from thinking about your finances. Whilst we completely understand this reaction, it’s important that you look after yourself and ensure your own financial security. You don’t want to later come across problems or financial hardship, which could have been prevented with a bit of organisation and help from a financial planner.

Here, we’ve compiled a short checklist which you might want to consider with your financial adviser, to sort through your post-divorce finances. Please note that this content is intended to inform and provide inspiration, and should not be taken as financial advice. To receive regulated, personal advice into your own situation, please consult a financial adviser.

#1 Bank accounts

Do you still have a joint bank account open with your ex-husband or wife? If so, then now might be the time to close them – unless you have a very good, agreed reason to keep these open. Just be careful; remember that joint accounts could become a liability which comes to haunt you later on if your ex runs up a large debt or overdraft.

On a similar subject, if you have not already done so then it might be a good idea to review your own bank accounts. This might involve opening a new debit/credit card account, for instance. It is probably best to establish these accounts first, prior to closing any joint accounts.

#2 Insurance

After the divorce, it is quite likely that you and your ex are now living apart. In light of this, it likely makes little sense to keep his/her name on insurance policies for your home or car, for instance, especially if you might be able to get cheaper policies by taking out newer, more relevant one.

Pay particular attention to your life and home insurance. For the former, you might have a policy which would pay out a lump sum to your ex if you died. Do you still want this to happen? If not, then consider getting a new policy! For the latter, are there items covered in the policy which belong to your ex, which no longer resides with you? Does it make sense to keep paying into a policy which covers them in the event of damage, theft or loss?

#3 Emergency reserve

As a single person, it is now even more important to ensure that you have a financial safety net in place. You cannot rely on a partner’s income, for instance, if you lose your job or suddenly face a large, unexpected expense. Consider building up an emergency pot to cover 3-6 months of living expenses, just in case.

#4 Other insurances

Following on from the previous point, it is quite common for financial advisers to hear their newly-divorced clients speak of feeling “financial exposed”. This is often because they believe that they will have few people to support them financially if things go wrong.

One pay to alleviate this worry is to consider taking out insurance to continue providing you with an income in the event that you lose your job or can no longer work due to illness or injury (i.e. “income protection” and “critical illness cover”). An independent financial adviser should be able to assist you here, helping you discern whether these policies are appropriate and finding you a good deal to cover your needs.

#5 A new plan

When you were married, your financial plan (assuming you had one) was likely tied up in your joint financial goals and vision for the future. Now, you will need to identify a new set of financial goals for yourself – which means crafting a new financial strategy and plan.

In particular, what are your new, desired objectives and lifestyle for your retirement? Are you on track to achieve these, and if not how can you now make appropriate changes to your finances and wealth in order to set you on course?

This is where a financial planner can be particularly helpful. They can assist you in reviewing your current situation, establishing where you are in order to help you identify the best route to get you heading towards your financial goals. They can make you aware of tax laws and investment opportunities which you might not have thought of, and point out common traps which you might not have spotted on your own.

If you would like to discuss your own situation with us and speak to a financial adviser here at WMM, then we’d be delighted to hear from you. Please get in touch today to arrange a free, no-obligation meeting with a member of our team, to start the conversation.