Save money on your mortgage

At Enable in Bishop's Stortford our IFA’s know that millions of families have saved a fortune on their mortgages since rates were slashed to an all-time low of 0.5 per cent in March 2009. But David Miles, a member of the central bank’s monetary policy committee, warned borrowers and lenders to prepare for the day when rates start to rise. ‘Interest rates will not remain at this level for many years to come,’ he said ‘They need to think very carefully what’s going to happen when the cost of that mortgage moves up.’

Bank governor Mark Carney last week hinted that rates could rise early next year for the first time since July 2007 but vowed that the MPC ‘will not take risks with the recovery’. He insisted any increases will be ‘gradual’ and ‘limited’ – bolstering expectations that rates will not rise above 3 per cent before the end of the decade.

But it is important to remember many borrowers have got used to record low mortgage costs. Graham Beale, chief executive of lender Nationwide, last week warned ‘a whole generation of borrowers have never experienced increases in their monthly mortgage payments’. A sharp fall in inflation however, to a four-year low of 1.9 per cent in January, according to official figures released today, has eased pressure on the Bank to raise rates. Keeping your mortgage right for you is part of what Enable’s IFA’s are here to do.


Remember - Your home may be repossessed if you do not keep up repayments on your mortgage. 
 

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

How to Invest passively

When most people think of an investment fund manager, they imagine a city professional staring at a screen of numbers yelling "buy" or "sell". It involves a human element of decision making; someone who is taking strategic decisions about whether to hold the shares of a certain company within the fund, trying to constantly achieve the optimum mix of shares and other assets to give their investors top returns. The human element in markets means that no fund manager will outperform year in year out. And naturally, this extra involvement doesn't come for free, so actively managed funds are generally more expensive than their passive equivalent and as much research shows they do not  regularly outperforming, the markets.

At Enable we believe Passive investments work best for wealth management; you might as well just track an index at a much lower cost, safe in the knowledge that whilst you probably won't outperform the market, your investments are less likely to significantly underperform the market, giving you peace of mind that your portfolio performance will always be there or thereabouts. Choosing a passive fund usually starts with deciding which index to track, such as the FTSE 100.



Needless to say, there are different types of passive funds. The funds which will most closely resemble the index they are tracking are known as full replication; they hold the same proportion of every share that makes up the index they are tracking. This is a simple but effective way of following an index. However, for smaller funds it can be so expensive to buy so many different shares that the charges would simply cancel out the lower cost benefit of a passive fund. As a result, these smaller funds will often buy a selection of shares to try and simulate the market, but this of course involves decision making about which shares to buy; again introducing the human element and possibility of underperformance compared to the market. The true benefits of passive investment for any portfolio are to try and achieve accurate index tracking with very low charges something Enables IFA’s  of Bishop’s Stortford will always be trying to do for you.


Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

Healthy finances for healthy relationships

With Valentines Day upon us again Enable’s IFA’s wonder if it might be worth reflection on some key steps thought to maintain healthy finances for your relationship.

Most relationships especially if you’re married or living together, will have experienced  “a money fight”. One of the biggest causes of problems in relationships is differences in values and goals and habits when it comes to money, and especially communication about money issues.

Money can’t buy you love, but we have all seen it tear relationships apart. Two simple steps can help alleviate the risk of this happening firstly learn how to talk about money with your partner, and secondly learn how to align your financial goals. If you can do those two things, you’ve done more than most couples, and you will have taken a significant step in the right direction to keeping your relationship on solid ground.

Then make sure you develop a system for finances that works for both of you. In order to put your financial plan into action, you’ll need to work out how you’re going to pay your bills, pay debt, deposit into savings, have money for extra expenditure treats adventures and hobbies.  You can think about each taking  responsibility for each part of the system (it’s better if you’re both involved, but you should find what works best for you as a couple).

Some couple even have weekly financial meetings. Just because you have common financial goals and a plan and a system doesn’t mean that everything is fine it still has to run and be reviewed. One way of having regular catch ups is for couples to see their Independent Financial Advisor together.  Enable know that by working together as a team families achieve better financial outcomes.

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

Any Investment starts with assessing risk.



If you are new to wealth management Enable’s experienced Independent Financial Advisors in Bishop’s Stortford will always begin with, discussing how much risk you are willing and able to accept with your money. This of course may be different for individual aspects of your portfolio, for example you may wish to have a higher level of risk on your long term pension fund, whilst preferring to be more cautious with your ISAs.



It is also important to agree investment objectives, to help you achieve your goals, it is important for us to understand why you are investing. Do you want to save for your Children's education? Do you want to retire early? Are you trying to achieve a certain standard of living in retirement? Do you need a minimum level of income now? Or it could be as simple as wanting to find the best home to grow your savings over the longer term. Understanding your goals and aspirations enables us to position your portfolio optimally for your needs.



Making sure your wealth has the most appropriate Tax Wrapper for you is also vital.  What we mean by tax wrapper, is the most appropriate mix of tax treatment, accessibility and complexity for the investments in question. Examples of the most widely used tax wrappers are Individual Savings Accounts (ISAs), Pensions, Onshore and Offshore Investment Bonds and Unit Trusts/OEICs. For the more sophisticated investors, Enterprise Investment Schemes (EIS) and Venture Capital Trusts (VCTs) can be beneficial in certain circumstances. We will of course be able to explain to you how each of these types of tax wrapper work, and recommend whether they deserve a place in your portfolio.



Whether you are a new investor or have been with us some time reviewing  and rebalancing is ongoing so Enable’s IFA’s can help to ensure your portfolio remains optimized for your requirements.

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

Making the most of your capital gains entitlement in 2014

Captial Gains is one of those little understood taxes that can make people more fearful of growth than necessary.

At Enable we want to remind clients that for 2013/2014, individuals are entitled to an annual exemption of £10,900 and trusts of up to £5,450 (this is reduced where the settler has set up several trusts, subject to a minimum of £1,090 per trust).

 Enable’s IFA'ss would recommend that if you think that your investments have made substantial unrealised gains and you have not yet made use of your annual allowance, you should consider talking to one of our Independent financial Advisors as you may be able to utilise your annual allowance, or put it to similar good use. You could for example, consider reinvestment in an ISA (subject to the ISA limits), or suing it for reinvestment by a spouse/civil partner or reinvestment into a similar holding. Consideration should be given to transferring assets between spouses/civil partners before encashment of any gains to enable each member of the family to use their annual allowance to maximize your family’s management of its wealth.

It can also be important to consider whether any investments have made a loss and whether any excess gains from other sources could be used to offset by any losses. Losses can be carried forward indefinitely, so it is important to include gains, losses and the annual exemption in any calculation to determine how to maximize any Capital gains relief.

Enables IFA’s are available to help you look at how best to manage your capital gains.


Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

How to keep your wrap fees low...

One of the most confusing issues to many investors is determining exactly what fees they are paying on their investments and investment programs. Fees are often a key factor in the choice of advisors, so making a decision without full and accurate information can have a significant impact on the ultimate success of an investment program.

The fee issue has taken on added significance as the number of advisors that charge an asset based fee has increased appreciably over the past decade. Historically, many advisors did not charge a fee per se for their services but rather were paid a portion of the commission costs on trades made in client accounts. Charging an asset-based fee is considered to be more beneficial to the client as both parties share a common goal of growing the overall value of the account.

At Enable our carefully constructed risk graded range of of portfolios are carefully selected to keep fees low.  All the asset classes used in our portfolios are accessed using very low cost passively managed funds. We currently use institutional class funds from Legal & General and Dimensional Fund Advisors plus Exchange Traded Funds (ETF’s) from iShares and Lyxor but are constantly looking to improve our offer to clients. The resulting total composite Annual Management Charges (including all trading costs, custodian fees etc) being in the region of 0.19% - 0.54% p.a. depending on the size of the portfolio and the risk grade selected.

(Please note that Enable’s fees and the investment platform/investment wrapper fees are in addition to these.)

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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

How to make money on your investment portfolios...

At Enable our Investment Philosophy rests on ‘passive’ rather than ‘active’ investment management. To put it in the simplest terms we look to try and extract as much of the market return as possible for the least possible cost. This is not the message that you will hear from the majority of investment advisers, stockbrokers or IFAs, but our view, backed by a wealth of research, leads us to conclude that most active fund managers rarely live up to  their hype.

The idea behind the active approach is that it is possible to consistently outperform ‘the market’. If it was so easy then why do the majority of money manager fail to achieve this? Depending on which research you read, only 25% of funds consistently beat their benchmark so you have a one in four chance of picking the right one? 

The research that Enable and others have carried out has demonstrated that over the long term, risk and reward are inextricably linked. In other words, the expectation of higher return will require a tolerance to higher volatility (risk). Moreover, equity investment has delivered the best long term returns when compared with cash, fixed interest securities (such as Gilts etc) and property, although it has certainly not been a smooth ride.  At Enable we have constructed a range of graded portfolios that blend lower risk/return assets with higher risk/return assets to achieve the desired portfolio characteristics. We then model the historic returns to ensure that our theory is backed up by real results.  If you want to explore making the most of your capital Enable's IFA’s are here to help.

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct 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