About Nicholas Grogan

Posts by Nicholas Grogan

Should I buy an annuity at age 67?

A recent study promoting buying annuities has received some attention in the press. An annuity is where you exchange some or all the money in your pension for an income. The company you buy it off will pay this income for as long as you live. You can also have the income linked to inflation

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How can you spot a “dodgy” investment?

Earlier this week we highlighted a report looking at another case of investors losing vast sums of money. They had put money into investments that had little hope of producing the returns being promised to them. You should always be on the lookout for scams. However, the types of investments we are talking about here

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PFS Awards: Investment Advice Specialist of the Year

The Personal Finance Society, the largest professional body for individual financial advisers in the UK, held its annual awards ceremony last night. They recognise and celebrate outstanding individuals and firms who strive to deliver exceptional consumer outcomes within the financial planning profession. During these awards, I (Nicholas Grogan) am proud to have been named Investment

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What does the Autumn Budget 2021 mean for me?

Against a backdrop of the continuing pandemic, global supply chain issues, plus significant concerns over rising energy prices and inflation, Chancellor Rishi Sunak has delivered his third UK Budget announcement. So, what was announced? No changes to income tax rates The Government has again stood by its election promise not to raise income tax rates.

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What is Cashflow Modelling?

We are committed to helping our clients better appreciate the value and benefits of financial planning. One of the ways we do this is by using lifetime financial forecasting, which we also refer to as cash-flow modelling. This enables us to help our clients understand their financial planning needs better. This is because it allows

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Is sharing a pension on divorce common?

The University of Manchester Research has published a report entitled: Pensions and Divorce: Exploratory Analysis of Quantitative Data. The report has found that, within couples, men have substantially more private pension wealth than women. This poses challenges should they divorce. The researchers looked at the pension wealth of almost 30,000 people over the age of

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Is salary sacrifice more attractive since the introduction of the Health & Social Care Levy?

We have written previously about how employees exchanging part of their salary and/or bonus for increased pension contributions has become common. We explained how this can be far more attractive than the employee making a direct pension contribution on his/her own behalf. Attractions of salary sacrifice Contributions paid out of an employee’s after-tax pay are

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Do the recent tax changes mean I should look at taking a dividend or bonus from my business again?

The social care announcement on 7 September 2021 increased both national insurance (NICs) and dividend tax from 2022/23. In addition, the March Budget revised corporation tax rates from 2023/24. The combined effect of these announcements might shift the decision of whether to take a dividend or not from your business. We have looked at some examples to see where these shifts might have taken

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What is the new Health and Social Care Levy?

To begin with, it is worth a quick reminder of the current social care position in England: (Wales, N. Ireland and, in particular Scotland, have their own variations on the theme): There is a £23,250 capital means test ceiling, above which all care costs must be met by the individual: the self-funding route. For those with wealth between

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Who do you work with best?

The clients we serve best have the following qualities: They work in partnership with us to make good financial decisions Our clients appreciate, that the advice of a highly qualified advisor is useless if not acted upon. The ultimate decision lies with them, and our role is to help them make it a good one.

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Am I better off picking my own funds?

Morningstar has published updated research as part of its annual Mind The Gap study on how much of market returns US investors get. The headline is those investors get 1.7% less than they should. What is the reason behind the difference? The explanation the report gives for this is that the investors mistime their buys

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How often should I look at my portfolio?

Your portfolio represents your future. It is only natural to want to check how your investments are doing. How often you need to do this depends on the type of investor you are. Speculators who constantly buy and sell individual stocks will monitor performance frequently, perhaps daily. Those investing for the long term with robust

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What was in the money sections of the weekend’s papers? (09/08/2021)

Help tomorrow’s widows prepare for an income shock In this article for the Financial Times, former pensions minister Steve Webb summarizes why two alterations to the state pension mean widowed women might experience an income “shock” along with bereavement in retirement. Among many mathematical examples, he encourages no couple to make any assumptions about the assistance available to

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Why do I own bonds which do not pay me much?

In today’s markets, bond yields are low and those of high-quality bonds are the lowest. In addition, they could quite feasibly crash too with interest rate rises. So why have bonds in a portfolio? It is quite straightforward. Imagine you only hold equities with a portfolio of £200,000. The economy takes a turn for the

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What was in the money sections of the weekend’s papers? (12/07/2021)

UK advertising watchdog to crack down on misleading crypto marketing The Advertising Standards Authority has informed the Financial Times it plans to pull misleading crypto advertisements. According to the agency, crypto is on a ‘red alert’ in financial advertising. Customers have usually been the ones to highlight potentially damaging adverts. However, the Advertising Standards Agency wants to

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Why is diversification so important?

Building an investment portfolio requires a mixture of investment science and common sense. The evidence suggests timing when to be in and out of markets (or sectors, or companies) is extremely difficult. It also suggests identifying a manager who can persistently beat the market is very hard to do in advance. We, therefore, focus on

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What is your approach to investing?

We sometimes refer to the way we invest as mostly being a ‘systematic’ approach. It is our duty to do what is right for our clients. When investing, we build on a foundation of facts. This is because we believe we would be doing our clients a disservice if we did it any other way.

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What is salary sacrifice?

It has become common practice for employees to exchange part of their salary and/or bonus in return for their increasing the pension contribution they pay by the same amount. This can be far more attractive than the employee making a direct pension contribution on his/her own behalf, particularly if the employer is prepared to increase

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What does my portfolio invest into?

What is an equity (or share)? An equity (or share) represents ownership of part of a company. This gives you a right to your share of any dividends paid and a claim on the company’s assets. Returns from equities come from changes in the price of the shares and dividends paid out. Are all equities

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What is investing?

This may seem an obvious question with an obvious answer. In some ways it is. We believe investing to be the means of building wealth to fund lifestyle and personal choices. It is a slow, emotional, and sometimes painful process requiring a robust plan, patiently executed over many years. Anyone hoping to get rich quick

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Will having more money make me happier?

There has been as much research into what makes us happier as there has been into what makes us wealthier. As financial planners, we are trying to help our clients improve their lives using their money. So, it is therefore important to look at what drives happiness and how it relates to money. The happiness

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How importance will inheritances be in the future?

The Institute for Fiscal Studies (IFS) has published a new report on likely future inheritances. It may give a future Chancellor something to consider The Institute for Fiscal Studies (IFS) has regularly looked at inheritance and inequality. In its latest paper, it has gone into greater detail, drawing on data from a variety of sources:

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What was in the weekend’s papers? (26/04/2021)

Financial advisers are putting your money in tracker funds – so why are you paying them? Financial advisers are facing pressure to justify their fees after putting customers’ money into tracker funds run by Vanguard. This is what this article in The Telegraph says. Vanguard, which launched its advice service earlier this month, runs £42bn of funds

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What is a Wrap?

Spreading your planning across a number of companies tends to generate mountains of paperwork. It also increases the hassle of getting up to date valuations or putting any changes in place. A Wrap Platform allows you to hold everything in one place. This enables you to quickly understand what you have and what you have

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What was in the weekend’s papers? (12/04/2021)

‘I tracked down my £14k lost pension – before the Government seized it’ More savers are trying to track down forgotten-about pension pots before the government takes the money for other uses, according to The Telegraph. The Government said in January that pensions that had lain dormant for years would be used to fund “good causes”.

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What was in the weekend’s papers? (29/03/2021)

Neil Woodford scandal: What fund bosses knew but never told us The Woodford scandal continues to unfold. The latest comes from The Sunday Times, which says the firm overseeing the fund, Link Fund Solutions, knew of its risky holdings but did not warn investors of such risks. Several requests of information were sent by Hargreaves Lansdown, who

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What was in the weekend’s papers? (08/03/2021)

Death tax to catch thousands more in £1bn pandemic raid The Telegraph says grieving families are set to be hit with a £1bn “stealth tax” grab. This is after Rishi Sunak revealed in his Budget that the government would cash in on inheritances to support public finances. Speaking in parliament last week, Sunak revealed his five-year freeze

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What was announced in the 2021 Budget?

This is one of the more important budgets of recent times. So, what was announced? Income tax rates, thresholds, and thresholds For 2021/22 Personal Allowance increasing to £12,570, basic rate band to £37,700 meaning a higher rate threshold of £50,270 – but then these figures will be frozen until April 2026. No changes to dividend

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What was in the weekend’s papers? (01/03/2021)

Lockdown savings? Put them in an ISA while you can This article in the Guardian looks at how the Covid pandemic has bolstered many people’s balances. It also has some tax-efficient places for readers to put their extra cash. The piece mentions various investment ideas but for most, we believe bespoke advice is best. Rishi

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What are dog funds?

The number of underperforming, or “dog”, funds has risen by a third this year, new data has shown. This is partly due to the gulf between the performance of different styles of investing. The pandemic has exacerbated this, but value and income investing have lagged behind growth investing for a while. How bad could having

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What was in the weekend’s papers? (22/02/2021)

NS&I blocks loyal savers from accessing their own cash Holders of savings bonds with National Savings & Investments could find their money locked away, according to The Telegraph. Previously customers could withdraw their cash at any moment with a penalty of 90 days’ interest. However, untouched savings are being automatically put into newer bonds which removes

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What was in the weekend’s papers? (01/02/2021)

Q&A: A basic guide to the GameStop squeeze The madness of the GameStop drama caught the full attention of the investment world last week. This Financial Times article asks how did millions of retail investors put big financial institutions under pressure with GameStop last week? This piece seeks to explain how the phenomenon, which began on a

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What was in the weekend’s papers? (25/01/2021)

NS&I boss apologises for customer service amid rise in withdrawals The Guardian covers how NS&I have apologised after low staffing levels left them unable to cope with “unprecedented” demand of savers withdrawing their cash. Savers pulled £26.5bn from the bank in the final three months of 2020. This came after it dramatically reduced the rates

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Do I have too much in cash savings?

The coronavirus (COVID-19) pandemic has caused massive job losses across the country. But some households have been saving more money than ever [1]. For these households, they have a choice which could have a big impact on their future wealth. This is the choice between saving or investing. More money to invest than usual The

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What are some good financial habits?

Paying yourself first Before you pay any bills, consider paying yourself first. This means saving and investing a portion of your earnings before you do anything else with your money. In the book The Richest Man in Babylon, written by George S. Clason, the parables are told by a fictional Babylonian character called Arkad, a

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What was in the weekend’s papers? (18/01/2021)

How Covid-19 rebooted retirement If coronavirus has brought a positive, writes the Financial Times’ it has purred people to look at their retirement plans. The article talks to several financial planners who say the pandemic has encouraged people their clients to re-evaluate what matters most to them. It has also given them a taster for what retirement

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Should I start my year-end tax planning now?

Last year, Autumn arrived without an Autumn Budget. In fairness, the Chancellor, Rishi Sunak, had already presented one 2020 Budget. This took place last March, and the pandemic made forecasting for 2021/22 all but impossible. The result was that, for the second year running, the Budget was deferred to the Spring. Whether Mr Sunak’s job

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How can I stop “sleepwalking” into retirement?

Around three in four people risk outliving their savings in retirement, a report looking into the impact of the pension freedoms indicates. The research found evidence many retirees risk potentially running their pension savings down. It termed this as “sleepwalking into retirement”. The study examined retirement planning and spending habits following the introduction of pension

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