Where to Save?

Enable’s IFAs know that the pain for savers appears to be never-ending. Recent figures from the Bank of England show that the rates for your average instant-access accounts have fallen to 0.15pc, so it’s hardly surprising that NS&I have also cut their rates including Premium Bonds.

But despite premium bonds prize money being cut from May 2017 from the rate for someone with average luck falling from 1.25pc to 1.15pc it still remain one of Britain's most popular savings vehicles, in which £66.7bn is invested. The complex way in which monthly prizes are distributed, with two £1m jackpots per month, and more than 2m £25 prizes paid, it means the odds of winning with any £1 bond are tricky to calculate but in total, 2,224,513 prizes of all values are currently paid per month. Dropping only slightly to 2,219,493 this May making the odds of any £1 bond winning any prize of any value will remain roughly one in 30,000.

The biggest falls in the number of prizes apply to the £25,000, £10,000 and £5,000 bands. The very smallest prizes of £25 increase from 2.1m to 2.2m. But security is the main draw of NS&I, and the main benefit of Premium Bonds, all the money invested in NS&I is 100pc protected by the Government, and bonds can be cashed at any time. However, many cite the chance to win big is what draws savers into Premium Bonds specifically but there's really is no guarantee, it’s a lottery you could win nothing at all and inflation could be eroding your cash. It's probably best to think of them as a flutter rather than aa savings account. But if you want some help finding better returns Enable’s IFAs are happy help you look at your options.

http://www.telegraph.co.uk/personal-banking/savings/premium-bond-prize-cuts-may-2017-odds-winning/

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

Caution in the UK housing market?

Political and economic uncertainty is likely to dominate the UK for a while and Enable’s IFA’s in believe this will continue bring caution to the housing market. Property transactions have been slowing and house purchases remain significantly down there is no doubt that this is partly due to the ongoing lack of housing supply but there are also many other factors at play.

UK house prices grew at their weakest annual rate in more than a year in January, as figures released by mortgage lender Nationwide revealed recently that annual growth edged down from 4.5% in December to 4.3% in January, making it the weakest house prices have been since November 2015.

“January’s icy weather was mirrored by a chill in the housing market. But though the national average price of a home fell by a few hundred Pounds, momentum remains.”said Jonathan Hopper, managing director of Garrington Property Finders. “The annual rate of price inflation is virtually the same as it was at this time last year, and six months on from the Brexit earthquake, the market has settled into its familiar pattern of steady growth.“ But the days of double-digit price rises are gone, and while the market fundamentals are strong enough to drive further growth this year, progress will be sedate rather than stellar.”He continued: “With the prospect of an interest rate rise – and of the cost of living rising faster than people’s wages – back on the horizon, caution will become a dominant force in 2017. If you are looking to get into housing this year Enable’s IFAs can help you look at your options.

https://www.propertyinvestortoday.co.uk/breaking-news/2017/2/caution-to-dominate-uk-housing-market-in-2017



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

Inequality in the family?

Enable’s IFA’s see many families who are concerned about he financial inequalities between the older generation and young families. The wealth gap between old and young may already be a well documented phenomenon in the UK but it could be set to grow even faster than expected say The Resolution Foundation.  They are concerned that higher inflation alongside persistently low interest rates and stagnant wages are going to widen the existing inequality between retired and working-age people.

Housing is by far the over riding factor in all of this but some families are adjusting, with older members increasingly likely to raise capital to give to children and grandchildren. The average income after housing costs for those aged between 25 and 34 dipped most heavily during the financial crisis, falling to a 10-year low of £18,891 in 2012; while the average income for over-65s rose sharply and is expected to increase to £22,387 this year making it on average almost £2,000 more than young workers.

According to investment company Hargreaves Lansdown, 62pc of Millennials (born between 80s and 90s) feel they are “financially unlucky”. But “baby boomers”, (born in 50s and 60s) know how lucky they are: 72pc feel their generation has been fortunate. New records are being set for the amount of equity released from homes. Last year £2.15bn was released by 27,563 people, according to the Equity Release Council and much of this borrowing comes from owners’ desire to help family, with almost half (44pc) used to help children or grandchildren, according to provider Key Retirement.

http://www.telegraph.co.uk/money/consumer-affairs/new-family-tax-older-family-members-paying-young/

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

Why is the cost of investing falling?

Enable’s experienced IFA’s have seen the cost of investing fall dramatically over the past decade. For many sound financial planning involves talking through your options with experts as well as using technology to reduce costs and increase transparency.

Funds that used to be run by people are now largely automated and run by complex algorithms simply overseen by humans. The daily rebalancing of a typical “passive” fund that tracks the market is now almost entirely autonomous. “Active” managers, who select shares rather than follow the market however also use technology much more. For both active and passive managers, the actual process of investing has also become more efficient. And these benefits are saving investors significant amounts too.

Alongside efficiency there is more and more of a push for active fund managers to be more transparent about the fees they charge. Investors can now easily compare funds’ fees and performance online, and a recent FCA report concluded that active fund fees were too opaque and tended to “cluster” around price points. It suggested that managers should be using an “all-in” fee to make it even easier to compare costs. With more focus on fees and the under performance of many active funds there has been a move towards low-cost “passive” investment. As more money flows into passive funds, the economies of scale grow meaning that they continue to get cheaper.

Some portfolios might have higher costs if they invest in niche assets such as hedge funds who might charge a management fee, plus a performance fee. If you want to make sure you have the right cost associated with your investments Enable’s IFAs are happy to talk it through.

http://www.telegraph.co.uk/investing/funds/four-reasons-cost-investments-falling/

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

Are there any gaps in your state pension contributions?

Enable’s IFA’s are keen to help anyone with their pension planning and despite the fact that a state pension may not be all you want to be relying on it is certainly a useful element of your retirement plan. But there have been changes in state pension provision and under the new “flat-rate” state pension you are required to have 35 years of full rate National Insurance contributions to receive the top rate, currently £155.65 a week.

It has recently come to light that thousands of people however would l not get the full amount if they have at some point been contracted out and paid a reduced rate of National Insurance. This set of circumstances is affecting s workplace “final salary” schemes and public sector workers such as teachers and nurses. But by filling in gaps in National Insurance records, you can dramatically boost state pension

But by making voluntary or “Class 3” lump sum payments you can fill in any missing years in your National Insurance record. It may mean you have to spend £4,000 to boost your state pension by £23,000 but hundreds of thousands of people are being urged to use a generous Government scheme to do just that. This guide published by Royal London, Britain’s biggest mutual company, explains how a single year of National Insurance can be purchased for around a lump sum of £733. This will boost state pension payments by around £230 a year for the rest of your life, totalling £4,600 in extra income over a typical 20-year retirement. Filing in five missing years using Class 3 contributions would cost you under £4,000 but generate nearly six times the outlay in extra state pension.

http://www.telegraph.co.uk/pensions-retirement/financial-planning/spend-4000-to-boost-your-state-pension-by-23000---heres-how/


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

First-time buyers surge

As independent financial advisors Enable like to be able to support first-time buyers to get their first foot on the property ladder.  Recently increasing numbers of first time buyers have been able to take up low cost mortgages in a slightly stalling property market to take their first stem into property suggests a recent report from the National Association of Estate Agents (NAEA).

The report says that in December 2016 first-time buyers made up almost a third of total sales which is not just a 10% increase on the previous month, but the highest number for the month of December in well over a decade. Overall, the sales agreed may have fallen despite the fact that the number of house hunters that actively registered to buy property rose to the highest level seen since 2003 but the number of properties listed for sale by estate agents in December was up slightly from November.

Mark Hayward, NAEA managing director said, “In November we saw a seasonal slowdown as typically it’s uncommon for people to buy and move close to Christmas. Yet, our December findings have completely bucked this seasonal trend,” He added: “With demand at an all-time December high and sales to first time buyers at their highest on record, 2016 closed on a positive note following several months of uncertainty.” If you are looking to try and get a foot on the housing market Enables IFAs can help you look at your overall financial planning as well as support finding the right mortgage options for you. 

https://www.propertyinvestortoday.co.uk/breaking-news/2017/1/record-numbers-acquiring-their-first-home


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

Wanting to fix your mortgage as a landlord?

Enable’s experienced IFA’s have many clients who have a buy to let property as part of their portfolio.  Despite the uncertainty that has been part of the post Brexit vote picture some mortgage offers might well be worth a look.  Barclays has recently unveiled its 10-year fix buy-to-let mortgage at 2.99% meaning private landlords are being offered an opportunity to secure low interest rates for a decade. The mortgage comes with a £2,000 fee but is not subject to strict rental income requirements because of the long time period of the loan.

On mortgage products with a term up to five years, the lender tends to require landlords to demonstrate that their rental income will cover their mortgage payment by a ratio of 145% if their mortgage rate went up to 5.5%. But there is a more flexible ‘affordability calculator’ on products that are five years or longer.  Jonathan Harris, director of mortgage broker Anderson Harris has said of the new buy-to-let product launched by Barclays’: “A 10-year fix for buy-to-let is unheard of and the result of changing circumstances for the sector. “What is exciting about this product is that the affordability calculator takes into account the applicant’s overall income and expenditure position - so massively benefits those applicants with strong incomes and limited commitments. “The upshot is that they can borrow more than previously - a welcome innovation to recent restrictive practices in the buy-to-let market.”

As with many mortgages there are often conditions and this product comes with a high exit charge of 5% if you need to sell or remortgage before the 10 years have passed.  If you are wanting to look into a mortgage for buying or renting we are happy to help.

Your home or rental property could be at risk if you do not keep up repayments.

https://www.landlordtoday.co.uk/breaking-news/2017/1/barclays-unveils-10-year-fix-buy-to-let-mortgage-at-2-99

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