Concerns over falling house prices and a coming raid on family wealth transmission are leading in our conversations with users, as is a desire to enlist professionals to take on some of the strain of managing wealth in an increasingly volatile world.
Summer dramas sends adviser demand soaring
The old advice used to be that investors should pretty much leave their portfolios alone over the summer period, but 2024’s multi-faceted dramas have rather given the lie to that notion and sent adviser demand soaring as a result.
We have seen rioting in the UK (and elsewhere), monumental one-day market declines and geopolitical tensions ratcheting up across a number of hotspots, even to the point of WW3 being spoken off in serious terms. Yet even among the constant stream of shocking news, people rightly want some time to unwind and switch off. No wonder then we’ve seen a significant rise in people wanting to outsource the burden of monitoring all these situations and adjusting their investment portfolios in response. Even successful DIY investors are evidently needing a break from all the stress.
The old advice used to be that investors should pretty much leave their portfolios alone over the summer period, but 2024’s multi-faceted dramas have rather given the lie to that notion and sent adviser demand soaring as a result
One myth is that portfolio management is a binary choice between full and no control, yet nothing could be further from the truth. You can certainly opt to have all decisions made by your portfolio manager once your parameters have been set (known as a discretionary wealth management relationship).
However, you can also have a much more collaborative relationship where you can have a good deal of input with investment ideas too. By comparing a shortlist of providers using our service, you can be sure to find the perfect match and relationship style for you.
HNWIs in some areas fear hits to house prices
For a great many people, their primary residence is by far their biggest store of wealth (alongside their pension pot). Many of our users in certain parts of the country are therefore rightfully concerned that Labour’s housebuilding plans could seriously hit the value of their home, and thus the overall wealth position of their family.
The issue is that the government’s plans seem to be centred on forcing huge housebuilding efforts in areas to the North of the country where demand is currently low, while simultaneously cutting back requirements in the capital, major cities and the South East. Some northern towns are reportedly being asked to increase housebuilding by an incredible 500% or more. Those whose family homes are in such an area may need to brace for a massive reduction in its value.
Some northern towns are reportedly being asked to increase housebuilding by an incredible 500% or more
While there is natural appeal in holding much of your wealth in bricks and mortar, such developments underscore how unwise it is likely to be to continue in an overly property focused strategy for your wealth. That is even more true when one considers how unappealing being a landlord is today given new red tape and restrictions on evictions.
A diversified approach to asset allocation is always a wise choice, and particularly so in today’s uncertain world. Why not take advantage of the conversations we can set up with leading advisers so you can get a sense of how well balanced your wealth really is across asset classes?
Top Tip
Lee Goggin
Co-Founder
The concept of giving while living gains further ground
There seems to be a real trend towards wealthy individuals looking to give away more of their wealth while still living; how to gift tax-efficiently while still staying well within the rules has been coming up more and more in our conversations with site users, and this is also a growing area of client interest according to the advisers we speak to at our panel institutions too.
Such gifting has been on the rise for some time now as frozen tax allowances and inflation have brought more families into the Inheritance Tax (IHT) net, with cash gifts having risen 40% in five years according to HMRC figures cited by The Telegraph.
However, the very much heightened interest in this strategy we are seeing is due to what many see as an inevitable tax raid on IHT and Capital Gains Tax (CGT) in Labour’s first Budget in October, other forms of tax rises having been ruled out.
The IHT rules allow for both large lump sum gifts to mark occasions such as weddings as well as gifting out of regular income (as long as this can be shown to be an affordable expenditure from excess cash)
The IHT rules allow for both large lump sum gifts to mark occasions such as weddings as well as gifting out of regular income (as long as this can be shown to be an affordable expenditure from excess cash). As long as the giver survives for seven years, these are then not considered part of the person’s estate for IHT purposes.
Gifting can certainly be a useful addition to an IHT mitigation strategy then, but there are a range of other options to explore, including trusts, life assurance to cover tax liabilities and investments which qualify for Business Property Relief. Estate planning is where wealth managers really come into their own, so why not let us set up some free, no-obligation conversations with leading advisers to see how they might help you?
The time to take action is now
There can be no doubt that affluent individuals face multifaceted threats to their wealth, whether that be from world events upsetting markets or policy choices closer to home. But, while it would be easy to feel overwhelmed, the most important thing is to remember there is a lot that you can do to mitigate these risks and that taking action is far easier and quicker than you might think.
By using our free online matching service you can meet a maximum of three wealth managers which are a good factual match for your needs, so that all you need do is make side-by-side comparisons to see which one feels right to you. The matching process is fast and free and could result in the most impactful wealth management choices you ever make.
Important information
The investment strategy and financial planning explanations of this piece are for informational purposes only, may represent only one view, and are not intended in any way as financial or investment advice. Any comment on specific securities should not be interpreted as investment research or advice, solicitation or recommendations to buy or sell a particular security.
We always advise consultation with a professional before making any investment and financial planning decisions.
Always remember that investing involves risk and the value of investments may fall as well as rise. Past performance should not be seen as a guarantee of future returns.
