The Office for National Statistics (ONS) announced late in October that the UK economy grew by 1.0% in Q3 2012, thus ending the nine month recession. This is
above the estimates of most economists who predicted a growth figure of 0.6% to be announced.
One of the major factors in this turn-around was the London Olympics, which
according to the ONS added 0.2% to the gross domestic product (GDP) figure from July to September.
Whilst this is very good news, the economy remains below the level of output seen before 2008, at the start of the financial crisis.
They also commented that the economy contracted by 6.4% between the start of 2008 and mid 2009, but has since recovered nearly half of that amount.
This quarter’s figures were also boosted, in comparison with the previous quarter, where we had additional public holidays to celebrate the Queen’s Diamond Jubilee and exceptionally bad weather, which dampened growth in this
period.
George Osborne, the Chancellor, commenting on these results on October 25th said: “There is still a long way to go, but these figures show we are on the right track. “Yesterday’s weak data from the Eurozone were a reminder that we still face many economic challenges at home and abroad.”
Given that these figures from the ONS are their initial estimate, it should be borne in mind that they can be revised higher, as happened in the last two quarters, or possibly lower in the ensuing weeks.
However, David Kern, chief economist of the British Chambers of Commerce added: “The 1.0% GDP figure for the third quarter is affected by distortions in the second quarter due to the Jubilee and Olympic ticket sales. Compared to a year earlier, the figures show that the economy is stagnant.”
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited
is authorised and regulated by the Financial Services Authority. It is
important always to seek independent financial advice before making any
decision regarding your finances. If you would like any assistance,
please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE.
Monday, 19 November 2012
Wednesday, 14 November 2012
Credit is no longer so easy...
As a parent another important lesson you can pass on to your family is managing credit. Enable’s experienced IFA’s know that being able to access and manage credit is vital to financial success. Understanding how it works can help you help them.
Most lenders go through two main credit reference agencies for information on your financial past – Equifax) and Experian , they compile credit histories from a number of sources, including the electoral roll, county court judgments and how effectively past debts have been paid. Every time a new form of credit is opened it will leave an electronic footprint on your record. The decision to turn borrowers down for credit isn't made be Experian or Equifax but by the lenders, based on their own criteria.
So if you want to be credit worthy these are some of the best things to make sure you have done;
• Get on the electoral roll.
• Don't make too many applications for credit in a rush – and that includes things like mobile phone contracts. Space out applications.
• Show lenders you're a responsible borrower by borrowing and paying it back. It might mean taking a credit card with a very high interest rate, spend small amounts and then keep clearing the balance.
• Do everything in your power to keep up all agreed repayments ask for smaller repayments if you're finding it impossible.
• Joint finance done with someone with a bad rating will affect your rating. If you split, write and tell the debt agencies.
Most lenders go through two main credit reference agencies for information on your financial past – Equifax) and Experian , they compile credit histories from a number of sources, including the electoral roll, county court judgments and how effectively past debts have been paid. Every time a new form of credit is opened it will leave an electronic footprint on your record. The decision to turn borrowers down for credit isn't made be Experian or Equifax but by the lenders, based on their own criteria.
So if you want to be credit worthy these are some of the best things to make sure you have done;
• Get on the electoral roll.
• Don't make too many applications for credit in a rush – and that includes things like mobile phone contracts. Space out applications.
• Show lenders you're a responsible borrower by borrowing and paying it back. It might mean taking a credit card with a very high interest rate, spend small amounts and then keep clearing the balance.
• Do everything in your power to keep up all agreed repayments ask for smaller repayments if you're finding it impossible.
• Joint finance done with someone with a bad rating will affect your rating. If you split, write and tell the debt agencies.
The Essential Annuity Check list...
Experienced Independent Financial Advisors at Enable know that there are several options to consider when buying your annuity and these will affect the income you and your spouse will receive for the rest of your lives so it is important to take time and consider your options thoroughly maybe with the help of an IFA.
These are the kind of considerations you should bear in mind:
■ Single or joint life: you can choose between a policy that simply pays an income during your lifetime, or continues to pay out to your spouse or partner after your death.
■ Level: an annuity that pays the same fixed amount every year.
■ Escalating: an annuity that rises every year, either in line with inflation or a set percentage, typically 3%.
■ Investment-linked: an annuity that makes payments at a level that changes depending on the performance of various underlying financial investments.
■ Smoker: the annuity is available only to smokers – although not to couples where only one is a smoker.
■ No guarantee: your income dies with you (unless you have a joint-life annuity).
■ Five- or 10-year guarantee: if you die soon after retiring, your estate will continue to get your full income for five or 10 years after you retire.
■ Enhanced/impaired: some providers will pay a higher income if your lifestyle, previous occupation, or illnesses or conditions are likely to mean you have shorter life expectancy.
The simplest annuity - a single life, level contract - will generally pay the highest income.
Still unsure? Then why don't you pop in for a chat.
These are the kind of considerations you should bear in mind:
■ Single or joint life: you can choose between a policy that simply pays an income during your lifetime, or continues to pay out to your spouse or partner after your death.
■ Level: an annuity that pays the same fixed amount every year.
■ Escalating: an annuity that rises every year, either in line with inflation or a set percentage, typically 3%.
■ Investment-linked: an annuity that makes payments at a level that changes depending on the performance of various underlying financial investments.
■ Smoker: the annuity is available only to smokers – although not to couples where only one is a smoker.
■ No guarantee: your income dies with you (unless you have a joint-life annuity).
■ Five- or 10-year guarantee: if you die soon after retiring, your estate will continue to get your full income for five or 10 years after you retire.
■ Enhanced/impaired: some providers will pay a higher income if your lifestyle, previous occupation, or illnesses or conditions are likely to mean you have shorter life expectancy.
The simplest annuity - a single life, level contract - will generally pay the highest income.
Still unsure? Then why don't you pop in for a chat.
Think about shopping around for Annuities?
If you are at that time of life when you are looking at buying your annuity talking it through with Enables IFA’s might make all the difference. Annuity Direct says 85% of its clients end up with a better income by shopping around rather than buying an annuity from their pension provider.
One of the things you might not expect to find is that you might be able to get a much higher income if you suffer from particular medical condition, this entitles you to buy an "enhanced" or "impaired life" annuity from a specialist provider such as Partnership or Just Retirement. Shopping around can achieve incomes on average 20% higher.
Some insurers plan to stop using gender in their pricing calculations even before the new rules come into force: the Prudential will switch on 12 November, while Aviva is expected to adopt unisex rates ahead of 21 December. Under recent rules pension providers now have to identify whether a client qualifies for an enhanced annuity and tell you where to buy one if they don’t themselves provide the service. However, these rules to not extend to members of certain occupational schemes – group personal pensions and defined contribution schemes set up in trust. If you are a member of this type of scheme, the provider has no obligation to offer you anything but its own annuities.
If you are trying to decided on your annuity and maybe have an underlying medical condition Enable’s IFA’s would be happy to listen to your requirements and try and match your needs.
One of the things you might not expect to find is that you might be able to get a much higher income if you suffer from particular medical condition, this entitles you to buy an "enhanced" or "impaired life" annuity from a specialist provider such as Partnership or Just Retirement. Shopping around can achieve incomes on average 20% higher.
Some insurers plan to stop using gender in their pricing calculations even before the new rules come into force: the Prudential will switch on 12 November, while Aviva is expected to adopt unisex rates ahead of 21 December. Under recent rules pension providers now have to identify whether a client qualifies for an enhanced annuity and tell you where to buy one if they don’t themselves provide the service. However, these rules to not extend to members of certain occupational schemes – group personal pensions and defined contribution schemes set up in trust. If you are a member of this type of scheme, the provider has no obligation to offer you anything but its own annuities.
If you are trying to decided on your annuity and maybe have an underlying medical condition Enable’s IFA’s would be happy to listen to your requirements and try and match your needs.
Thursday, 8 November 2012
Sorting your Annuity, you might have to act quickly
If you are a man and aged 55 or more and planning to retire in the near future you need to get your skates on before new rules to be implemented in December could mean you receive less retirement income from your pension savings.
Men have on average received about 4% more income from their annuities than women, because women tend to live longer. But the EU gender directive, which comes into force on 21 December, will stop insurance companies using the sex of a pension policyholder to determine the income the policyholder receives when they cash in their savings and buy an annuity. Insurers have said they will rely more heavily on other criteria, to underwrite annuities, including the type of work a policyholder has done and whether they suffer certain medical conditions.
For men, the move means a sharp drop in annuity rates, building on a gradual decline over the past few years. This means that men planning to draw their retirement income in the near future should consider bringing their plans forward to take advantage of differential rates. "Ideally, they should ask for a quote now, then repeat that process every 14 days," he says. "If they see the rate they are offered beginning to fall, it's a sign they should act very quickly to buy their annuity."
It is still best not to rush into anything before checking, IFA Enable can help you make sure you are doing what is best for the whole of your retirement portfolio.
Men have on average received about 4% more income from their annuities than women, because women tend to live longer. But the EU gender directive, which comes into force on 21 December, will stop insurance companies using the sex of a pension policyholder to determine the income the policyholder receives when they cash in their savings and buy an annuity. Insurers have said they will rely more heavily on other criteria, to underwrite annuities, including the type of work a policyholder has done and whether they suffer certain medical conditions.
For men, the move means a sharp drop in annuity rates, building on a gradual decline over the past few years. This means that men planning to draw their retirement income in the near future should consider bringing their plans forward to take advantage of differential rates. "Ideally, they should ask for a quote now, then repeat that process every 14 days," he says. "If they see the rate they are offered beginning to fall, it's a sign they should act very quickly to buy their annuity."
It is still best not to rush into anything before checking, IFA Enable can help you make sure you are doing what is best for the whole of your retirement portfolio.
What you need to know about womens pensions...
Several recent reports have suggested women have been hit hardest by the economic downturn, with high unemployment rates and the loss of some benefits, causing women to neglect saving into a pension.The average monthly saving among women has fallen from £130 to £95 since 2011, while the average for men has risen from £174 to £185. A 30-year-old woman who continues saving at the same rate will retire on a pension pot almost £30,000 smaller than a male the same age.
Scottish Widows found women were undertaking long-term savings outside pensions, although the amount put aside has fallen. Women who are saving put aside £203.21 a month on average, down from £227 in previous years, and 29% are saving on a regular basis.
Lynn Graves, of Scottish Widows, said: "The recession has had a major impact on people's attitudes to managing their finances, as the message to 'live within your means' has been hammered home. While women are right to focus on making sure their debts are manageable, other sacrifices may need to be made to ensure retirement plannning is in place. "There is clearly a demand for greater financial support and financial education to help people get the balance right between managing debt payments and taking a realistic approach to long term savings."
Dr Ros Altmann, director-general of Saga, said the figures showed women were "still very much second-class citizens" when it came to pensions. Enable’s Independent Financial Advisors can help women of every age plan their savings.
Scottish Widows found women were undertaking long-term savings outside pensions, although the amount put aside has fallen. Women who are saving put aside £203.21 a month on average, down from £227 in previous years, and 29% are saving on a regular basis.
Lynn Graves, of Scottish Widows, said: "The recession has had a major impact on people's attitudes to managing their finances, as the message to 'live within your means' has been hammered home. While women are right to focus on making sure their debts are manageable, other sacrifices may need to be made to ensure retirement plannning is in place. "There is clearly a demand for greater financial support and financial education to help people get the balance right between managing debt payments and taking a realistic approach to long term savings."
Dr Ros Altmann, director-general of Saga, said the figures showed women were "still very much second-class citizens" when it came to pensions. Enable’s Independent Financial Advisors can help women of every age plan their savings.
Guaranteeing a mortgage
Independent Financial Advisor's Enable have been helping many families where the child's income is insufficient to allow them to purchase a first home. Another way to support your children is by using your own income to boost what can be borrowed. This can be done by acting as a "guarantor" or opting to take out a joint mortgage.
One of the providers of mortgages Woolwich, currently allows the parent to be named jointly on the mortgage, but this doesn't mean the parent has to be a joint owner of the property. This helps sidestep any potential capital gains tax issues. The option is available on all Woolwich's core mortgage rates. The Mortgage Works offers specific deals for guarantors, some on a "limited liability" basis – where the parent guarantees just the top-up amount required above what the child could borrow.
Lenders however typically refuse to lend to parents who will be over 70 or 75 at the end of the mortgage term. You may be able to borrow over a shorter term, but this will push up the cost. Parents need to understand that they are offering additional security, which will be at risk if their offspring defaults on the mortgage. If you are over 70 and have a lot of equity in your home, you could consider releasing some but, lenders have tightened their policies since the downturn, which can affect what parents can borrow." Enable’s IFA’s will be able to help you find the right deal to help your family.'
One of the providers of mortgages Woolwich, currently allows the parent to be named jointly on the mortgage, but this doesn't mean the parent has to be a joint owner of the property. This helps sidestep any potential capital gains tax issues. The option is available on all Woolwich's core mortgage rates. The Mortgage Works offers specific deals for guarantors, some on a "limited liability" basis – where the parent guarantees just the top-up amount required above what the child could borrow.
Lenders however typically refuse to lend to parents who will be over 70 or 75 at the end of the mortgage term. You may be able to borrow over a shorter term, but this will push up the cost. Parents need to understand that they are offering additional security, which will be at risk if their offspring defaults on the mortgage. If you are over 70 and have a lot of equity in your home, you could consider releasing some but, lenders have tightened their policies since the downturn, which can affect what parents can borrow." Enable’s IFA’s will be able to help you find the right deal to help your family.'
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