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  • 01 February 2016

    Wear Sunscreen...

    I heard the 1999 hit “Wear Sunscreen” by Baz Luhrmann on Radio 2 recently. I had forgotten how cheesy and yet how poignant it was. When searching for the lyrics on Google, I was surprised to discover that he hadn’t actually witten them and they were in fact written by Mary Schmich, a columnist for the Chicago Tribune. Within two months of Mary writing the column in June 1997,which she described as being the commencement speech she would give to the class of ’97 if she were asked to give one, it had gone viral by e-mail (remember those days!)

    I was struck by the resemblance that some of the lyrics had to some of the conversations we have with our clients at FMB. We’re in our 29th year and over that time, we’ve shared the experiences of our clients through the good and the bad, the mundane and the unexpected.

    “The real troubles in your life are apt to be things that never crossed your worried mind, the kind that blindsides you at 4 p.m. on some idle Tuesday.”

    Loss and sadness are an inevitable part of life, but what we do know is when that idle Tuesday comes, you really don’t want to be worrying about money. We’ve helped our clients through those difficult times, and that is when people understand the true worth of a personal service, not a website.

    “Do one thing every day that scares you.”

    We really encourage clients to think about making their money work for them; we try to find out what motivates them and how their money can help them achieve their dreams and goals. Money is only a means to an end, so use it to do something that scares you!

    “Don't expect anyone else to support you. Maybe you have a trust fund. Maybe you'll have a wealthy spouse. But you never know when either one might run out.”

    Marital disharmony, another fact of life. It’s not that surprising that money arguments are one of the top causes of divorce. It’s important to have trust, and a financial planner can help bring issues out in the open in a calm, neutral way. As for relying on a wealthy spouse or trust fund, that comes with its own set of problems too!

    “Keep your old love letters. Throw away your old bank statements.”

    Very sound advice, we’ll worry about the money stuff for you!

    But most of all, don’t forget to wear sunscreen!


    Click here to view Mary's original column post.

    Click here to watch Baz Luhrmann's video on YouTube.

  • Last year, we saw the biggest change to pension legislation that the UK has seen in over a century - the Pension Freedoms reforms were introduced to provide people with a lot more flexibility when it comes to how they can take their pension benefits. It's not surprising that this 'freedom' now poses many more questions for those approaching retirement.

    Everybody wants to get the most out of their pension savings, understandably, and one thing that may be overlooked is the benefits that are associated with the different pension types – especially on death. I have seen a great article in this month’s Scottish Widows Techtalk magazine which summarises the key differences in the death benefits between defined benefits and money purchase pensions following the Pension Freedoms reforms. It is worth a read!

    Click on the PDF at the bottom of the page to access the article.

  • Sainsbury's Mog the cat
    Caption: Sainsbury's Mog the cat

    I don’t watch much TV in real time these days, so I often fast forward adverts which is by far the biggest advantage of the digital age as far as I am concerned. However at this time of year advertising transcends to a whole new level. Newspapers, social media and pretty much everyone is talking about the big Christmas ads. I actually went out of my way to watch them, seeking them out on YouTube. I suppose my role here at FMB means I tend to take an interest in trends in brand and advertising so I may have a professional curiosity, but I think it is fascinating the way it has played out this year.

    Personally, I felt John Lewis came out on top last year, ticking all the usual boxes with the delightful story of the boy and his penguin while Sainsbury’s took some criticism for cashing in on the WW1 centenary. This year, in all honesty, I find the lonely man on the moon for John Lewis too maudlin. For me, Sainsbury's Mog the cat comes up trumps in the festive ad stakes; pushing all the right emotional buttons while also perfectly showcasing Sainsbury's products. I think at Christmas time we're more prepared to accept this heartstring-tugging whereas we might be more cynical at other times of the year.

    Getting the balance between eliciting emotion and selling the benefits of your service or product is a tricky balancing act. Financial services are not an impulse buy; people think long and hard before deciding on whether they need a financial planner, let alone which one they would like to work with. We need to make sure we tap into the emotional reasons people need us; it will give you peace of mind, it will give you financial confidence, it will help you get more out of life. However, we also need to give the hard facts people need to evaluate our service; what qualifications do you have? Who else uses you? How will you invest my money?

    If we get the balance wrong and only talk about the feelings and emotions without any evidence, we would come across as slimy and salesy. On the other hand, if we were only to talk about the stats and facts, we would seem cold and not interested in the individual. You can probably think of examples of when this has happened to you; it’s how sales has got a bad reputation. John Lewis and Sainsbury’s and the other successful brands are selling, it just doesn’t feel like you are being sold to.

    At FMB, we don’t have a marketing budget to justify a big TV campaign but we have made some short videos that we have used on social media. Their aim is to generate a positive feeling and enough interest to warrant further investigation on our website, where all the evidence can be found to make a full evaluation of FMB.

    Click here for our video - it’s not quite John Lewis, but we think it sums up FMB pretty well.

    You may have seen the Sainsbury's Ad, but have you seen the 'behind the scenes' clip on how it was made? I find it incredibly fascinating! 

  • 17 December 2015

    Pension Reforms: Take 2

    Unless you have been living in a cave over the past year, you cannot have failed to have heard about far-reaching pension reforms that took effect from April this year, which meant that those who wished to access their retirement benefits were no longer required to purchase an annuity.

    Legislation has been chugging along, and as we head towards April 2017, those who have previously purchased annuities will be given an element of flexibility too. In June this year, it was announced that the Treasury had backtracked and now plans to allow providers to buy back annuities from existing customers.

    People wanting to sell their annuities above a certain value will be required to take advice, although this threshold has not yet been set.

    In a call for evidence published on 16th December 2015, the Treasury says: “While the Government recognises the benefits both to annuity holders and the industry of permitting this ‘indirect buy back’ through brokers, financial advisers or other intermediaries, it acknowledges that an extra layer of cost would be imposed in comparison to direct buy back. In addition, buy back would only be possible ‘if’ platforms or brokers enter the market."

    Hidden away in the final line of the previous paragraph is the little word ‘if’. I now fear a sense of déjà vu; while legislation will allow a client to sell their annuity, it will depend on whether the company that holds the annuity wishes to play ball. I say this, as eight months into the current pensions reforms we still encounter many pension providers that are not willing or able to offer clients the flexibility they want from their money!

    It’s going to be interesting. Watch this space!

  • Today sees the launch of the Help to Buy ISA; savings accounts aimed to assist aspiring first-time buyers get on the property ladder. They are available from banks and building societies and are only accessible to first-time buyers looking to build up enough cash for a house deposit.

    The Government’s aim is to solve the current crisis of too many families being forced to rent a house as they cannot afford the large deposit required to take out a mortgage.

    What are the incentives?

    Any amount saved will be ‘topped up’ by the Government at the time of the house purchase by a bonus of 25%, up to a maximum of £3,000.

    You can switch between providers in order to obtain the most competitive interest rates.

    Eligibility and the fine print...

    To qualify, savers must be UK resident, aged 15 or over, and buying a property in the UK for the first time. The house must NOT be for the buy-to-let market and must not exceed £250,000 (or £450,000 in London).

    Due to limitations on what you can save in these accounts; you can deposit a maximum initial investment of up to £1,000, followed by monthly instalments of up to £200. In the first month, these limits can be combined if you wish, so you can start off with a deposit of £1,200. Once the balance reaches £12,000, it would then qualify for the maximum Government bonus of £3,000.

    Couples can open one account each, meaning they could potentially claim a total of £6,000 from the Government. To qualify for the bonus, you have to have at least £1600 saved.

    These schemes will be closed to new entrants from 30th November 2019, and the bonus must be claimed (through the purchase of a house) by 1 December 2030. The bonus would be claimed by the solicitor or conveyancer who handles the purchase of your house.

    If you do decide to open a Help to Buy ISA, it is important to note that you are prevented from opening any other ISA accounts, but you may continue to hold existing ISAs.

    On the face of it, these appear to be an attractive scheme; however with the average house deposit totalling £36,000 for a first-time buyer, other savings would still be required. The main attraction is the attractive interest rates currently being offered for these schemes, with Halifax currently offering the market leading rate of 4% per annum.

    If you are planning to buy your first home in the near future, it could be well worth considering opening one of these schemes.

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  • Top 5 financial planning tips for accumulators

    If you are in your thirties or forties now could be a good time to review your finances. We have compiled our top 5 tips for small tweaks that can make a big difference to your long term financial plans. See the top 5 tips here

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