Our clients often ask us for advice about putting money away for their children and grandchildren and the introduction of Junior ISAs in November 2011 has made this something of a hot topic with financial journalists. In this article we will start with a reminder of the Child Trust Fund and Junior ISA rules and then provide our view on how best to use these.

Figures from Morningstar show that UK gilt funds dominated the top 10 performers for 2011. In fact, only one fund in the top ten didn’t fall into the gilt sector, the Legg Mason Japan Equity Fund. Few people would have predicted that Japanese equities and UK gilts would have made up the top 10. In fact, these asset classes would perhaps have been described by many as “boring” or “overvalued” back in January 2011.

Three investment articles have caught our attention recently. The first, “Shopping for Alpha: You get what you don’t pay for” (May 2011) is a detailed research document looking at ways of identifying superior funds. The second is “Keeping the cost monsters at bay” by Patrick Collinson in Fund Strategy (7th November 2011) and the third, “Last refuge of overblown management fees” by David Stevenson in the Financial Times (12th November 2011). In this article we will look at some of the conclusions from these pieces.

Evolve Financial Planner Jason Witcombe was recently interviewed by Owain Bennallack at The Motley Fool.

Find out where you are

First of all, figure out what you have currently got as without this information you’ll never know whether you are on track to a secure retirement or not.  Many of us have “bits and pieces” of pensions from previous employers but lose track of their values. In particular, if you have an old final salary scheme, this might be a lot more valuable than you think. A deferred pension of one or two thousand pounds a year at retirement might not sound like much but you would need a five figure sum in a pension to generate that sort of income.

Something we always stress to our clients, and in particular to married couples/civil partnerships, is that they should treat their finances as one unit rather than seeing themselves as two individuals. That way, they can make their combined finances more tax-efficient.

On 14th October it was announced that the pensions annual allowance is to be cut to £50,000 from April 2011. The allowance is currently £255,000 but there are very few circumstances where contributions of this level can actually be made.

Evolve Managing Director Antony Williams was recently interviewed by David Kuo of The Motley Fool.

Some of the most effective financial planning strategies are the easiest to implement. In this article we look at five simple ways to improve your finances.

As the saying goes, there is no such thing as a free lunch and there is certainly no such thing as free financial advice. The vast majority of investment advisers work on a commission rather than fee basis and whilst you do not physically write out a cheque for the advice, you are paying for it out of the investment plans/policies you buy. You may be paying too much.

Markets will always have their volatile periods and no one can predict which weeks or months will generate good or bad returns and how long those periods will last. However, being out of the market for even short periods can markedly affect long-term portfolio performance.

All clients of Evolve will be well aware that our investment strategy is based on using low cost index tracking funds.  We are passionate about keeping the cost of investment as low as possible and very much hope the entrance of Vanguard into the UK market will force other fund managers to reduce their charges.

Many employers offer their staff a range of benefits as well as salary and bonus but these are often not communicated as well as they could be. We have a number of clients who had been missing out on excellent opportunities until we helped them to clarify what was available to them. With some benefits you may have to make an active decision to join whereas with others, enrolment could be automatic.

The efficient market hypothesis, which was developed in the 1960’s, states that an efficient market for equities, or indeed any other market is one where, given the available information, actual prices represent a very good estimate of intrinsic values.  Prices are always changing as new information is coming to the market.  This information may relate to specific shares or the economy more generally.  But when news does become available, prices react rapidly.

This might sound counter-intuitive but it can be a valuable financial planning tactic in certain circumstances.

"Inheritance Tax is a voluntary tax, paid by those who distrust their heirs more than they dislike the Inland Revenue!" Lord Jenkins.

Annuity purchase is possibly the most difficult financial decision that you will make in your life. It is a one-off choice and if you get it wrong, there is no turning back. If you are approaching retirement, it is vital that you take professional advice to ensure that you fully understand the implications of your actions. 

Many of us do not like to think about serious illness or death but spend a minute or two imagining the financial impact of this and the results can be quite sobering. Could you support your family, whether financially or by running the family home? Would your spouse or partner be able to run the family home without you? In fact, would he or she be forced to move house? Would your children still be able to get the education you want for them?
If you are single, how quickly would you run out of money if you couldn’t work?