Traditionally, it was a rule of thumb that 4% was a sustainable withdrawal rate from your pensions to provide for a 30-year retirement. But research from Morningstar suggests the figure should be much lower, and the 4% assumption was never ‘safe’ in the UK. Over a 30 year period, in a portfolio of 40% equities, they actually calculated the most likely successful withdrawal rate to be as low as 1.8%. Of course, it’s not quite that simple; there are many personal factors to consider, which we’ll discuss shortly. The problem is, figures from AJ Bell show that 41% of retirees are withdrawing more than 10% of their pension every year. These people are likely to run out of money in just eight... Read More

In my last few blog posts we’ve focussed on things to avoid, like: The promise of ‘Brexit-Proof’ portfolios, based on vague speculation; Believing everything you read in financial media, often biased and sensationalist; and Chasing the promise of big investment gains, that can turn out to be scams. Now, I’ve suggested what you shouldn’t be doing, let’s focus on what you should! To help secure your financial future, I believe there are ten simple steps you can follow: 1. Start planning as soon as possible The earlier in life you start your financial planning, the bigger its potential impact. Compound interest and investment returns, over time, could significantly boost your savings. Compounding means you effectively earn interest on past interest.... Read More

Brexit continues to dominate headlines here in the UK and abroad. Big businesses are blaming it for falling profits, Boris Johnson is using it in an attempt to bolster his profile and there are warnings we could run out of food. There is also a growing concern for our economy and the stock market. You don’t need me to tell you how often Brexit stories are in the media, you can’t avoid them. You can be forgiven for not knowing where to look, let alone what to believe. Again, it’s sensationalist media; nothing short of conjecture and scaremongering. Journalists are once again preying on fear to sell papers. The only thing that has indisputably happened is that the UK triggered... Read More

Sensationalist media is nothing new, but in the past ten years the number of delivery formats, and hence the sheer quantity of outraged, agenda-laden and scaremongering articles, has exploded. You don’t need to buy a newspaper, turn on the television, or even look for sensationalist headlines; sat at your desk, advertisements, direct email and social media posts will quickly find you. Tabloid papers are still particularly guilty, having hidden agendas to publish dramatic material because, frankly, it sells. Yes, they are subject to legalities regarding libel, privacy and copyright, but there is no restriction on using terms such as market ‘CRASH’ or ‘CRISIS’, conjuring doom amongst investors when in reality, it’s nothing more than a temporary market decline. The social... Read More

There are no short-cuts in financial planning, no big gain guarantees, no quick wins. The financial services profession still has an image problem and I propose that blindly chasing investment gains is one of the reasons why. The Financial Conduct Authority (FCA) published its Financial Lives Survey earlier this year and amongst other things, it measured public perceptions and the profession’s reputation. Whether public uncertainty began with the 2008 financial crisis is debatable, but the survey found that 9 years later just 39% of people said they trust advisers to act in their best interest. Alarm bells ringing The survey also found that 23% of people had been approached about their pensions or investments by what they believed to be... Read More