Why wait to leave a legacy?

Why not gift that money now and watch others benefit?

By Dan Hiles, Chartered Financial Planner, Brunel Capital Partners

Many people, understandably, have a wish to leave a legacy on their death. One of the questions we often ask clients is why not gift that money now and watch others benefit from it while you are alive?

There are several responses to this question but the most common is a reluctance to give away capital that may be needed in the future. Again this is totally understandable but I would argue doesn’t always reflect your true financial position – you simply may not know how much is enough… yet.

By using our cash flow forecasting software we are able to run through scenarios with our you to see how much is enough and what amount of capital you are realistically never going to need during your lifetime. If you haven’t seen the full impact of our cash flow forecasting this could be a good time to start. If you are already familiar – are you harbouring any desire to explore gifting further?

One of our clients recently admitted to me that they would dearly like to help their Granddaughter out with education costs as her parents were struggling to raise the finances. They were passionate about helping their family but had not yet given themselves permission to handover the money for fear they would need it themselves. By making some conservative assumptions we demonstrated that they could comfortably gift the money and never run out themselves. The outcome – a very happy family and the reward for the Grandparents of seeing their heard-earned wealth used for the good of their loved ones!

It isn’t always about helping family. We all become touched by a particular good cause or local project that would benefit hugely from additional support. What if you could help a local good cause or a charity close to your heart and then see the benefits to those you have helped? Surely that is a more rewarding use of your surplus capital than sitting and waiting for them to benefit after your demise.

People who go through this process feel a great peace of mind to know they will never run out of money but also an immense sense of satisfaction that they could pass on money now and enjoy seeing the benefits to those they have helped.

Not only is this an emotionally rewarding experience, it makes good sense for Inheritance Tax (IHT) planning too.

Everyone has an ‘annual exemption’ of £3,000 to make gifts without IHT consequences as well as smaller gifts of £250 but more substantial gifts are also possible and providing you live another seven years will be completely free of IHT allowing wealth to pass through generations.

Those wanting more control or not wanting to make large gifts have a range of other options to mitigate IHT. The message is the same as always – talk to us about it. You might be surprised what you can give away now without jeopardising your own lifestyle.

Dan Hiles, 0117 214 0870, dan@brunelcp.com

Quantity and quality – Brunel Capital Partners successfully renew industry accreditations.

We’re pleased to say we’ve not been resting on our laurels here at Brunel! We recently had our British Standard Audit and have just heard that we have passed again, meaning we can carry our BS8577 accreditation on for another year. This Standard evaluates the ‘framework for the provision of financial advice and planning services’ and is one we place great value on as it reflects our commitment to quality and continuous improvement.       Read more …

The context behind last month’s ‘God bless the Brits’ article…

Last month our Client’s Corner feature was an article entitled ‘God bless the Brits’ and expressed some pretty strong views in favour of the Brexit result.

It certainly produced some strong reactions from some of you and so we’d just like to explain the background behind it. We included the piece, which was written by Nick Murray, as an alternative view from across the pond. Nick is based in Southold, NY, in the States and is in his 50th year in the profession of financial advice. He is a well-known speaker within the industry and is the author of eleven books for financial services professionals. Read more …

Help To Buy vs Lifetime: Which ISA is best?

Set to be introduced in April 2017, the Lifetime ISA essentially offers an alternative to the Help To Buy ISA. With two competing options on the table, it’s important to know which is best for you and your needs, as whilst they have some similarities, there are also key differences between the two. Read more …

What’s on in Bristol this summer?

As fellow Bristol residents will probably already know, we’re lucky to live in and around an active city, full of events, things to do and places to see. Summer 2016 promises to be no exception, with Bristol offering some fantastic ways to get out and about and enjoy all that the city has to offer. A quick search on the Visit Bristol website reveals 456 events scheduled before the end of August, so what are some of the highlights we should all be taking note of over the coming months?  Read more …

May Market Comment

As the days have been lengthening, so markets have developed a rather different feel to that which had been established as spring blossomed, following a difficult start to the year. Shares in the UK touched an eight week low recently, with investors spooked by worsening economic data in the US (jobs growth there was way below expectations), growing evidence of the slowdown in China and seemingly rising expectations of Britain voting to leave the European Union.

Market comment 12th May

What keeps us happy and healthy?

Looking back, if you were going to give some advice to your former self, where would you recommend investing the most time and energy to lead a happy and fulfilling life?     

In a recent survey of millennials (i.e. those born between 1982 – 2000) over 80 per cent said that a major life goal for them was to get rich. And another 50 per cent of the same group said becoming famous was a major goal – a sad reflection of  the celebrity culture we live in, it would seem. Read more …

Use it or lose it time for your ISA

As the end of the financial year draws ever closer, it’s important not to forget about any ISAs (Individual Savings Accounts) you have and any remaining payments that you’re allowed to make. The maximum allowance for ISAs for the 2015/16 financial year is £15,240, so it’s important that you invest any funds that you have left to pay into your ISA as close to that amount as possible, as soon as you can. Read more …

Retirement ‘class of 2016’ owe less than last year’s

The amount of money owed by those planning to retire over the course of the next 12 months has fallen for the fourth year in row, according to the latest research by Prudential. This year’s retirees who still have debts owe an average of £18,800, a fall of £3,000 or 14% from last year and a drop of nearly £20,000 since 2012 when the average amount owed was £38,200. However, despite the continued fall in average debts, Prudential’s unique research into the financial plans and aspirations of people planning to retire in the year ahead – the Class of 2016 – shows that the proportion of retirees in debt remains stubbornly high. Read more …

Budget 2016 Overview

Introduction

It was famously said that ‘all roads lead to Rome.’ In British politics, all speeches currently lead to the EU Referendum. George Osborne’s Budget speech, delivered on Wednesday March 16th, was no exception.

More than ever, the Chancellor was seeking to balance politics and economics as he rose to speak. On the politics front, there were a good many restive backbenchers behind him who had already put paid (at least for now) to the Chancellor’s widely-trailed intentions to reform tax relief on pension contributions. There was also an electorate to convince – and the Chancellor’s own political ambitions. Make no mistake, if the ‘Leave’ camp wins the EU referendum, George Osborne’s chances of succeeding David Cameron in the inevitable leadership battle are almost non-existent.

Read more …