Author: Rob Bowers

This month, we’re delighted to share the details of two exciting events.

First up, the Blue Wealth team has been busy planning a brand-new summer social, and we’d love you to join us.

Also, we’re proud to announce that Adrian Thorley will be taking part in a triathlon this month. He’ll be raising funds for our charity partner, Community for Purpose, and would love your support.

Keep reading to find out more.

Join us on a summer boat trip this July

We love meeting up with our clients both in and outside the office. There are some staples in the Blue Wealth calendar, such as the annual golf day, but we also enjoy coming up with new ideas.

So, this summer, we’ve planned our first summer boat trip from 5 pm to 7 pm on Thursday 3 July.

The evening will begin at Princes Wharf, where we’ll board The Matthew, Bristol’s historic floating harbour.

The ship is a fabulous and faithful reconstruction of the vessel used by explorer John Cabot when he sailed from Bristol and discovered Newfoundland in 1497.

Once everyone’s aboard, we’ll set off on a gentle one-hour trip around Bristol harbour, during which you can catch up with the team over a drink or two.

After docking, there will be another hour to relax and chat, with food provided by The Jolly Hog.

It’s going to be a fabulous evening, and we’d love to see you there.

If you’d like to book your place or if you have any questions about this event, please email your adviser.

Adrian is taking part in a triathlon to raise funds for our charity partner

When he’s not busy supporting clients at Blue Wealth, our financial planner, Adrian Thorley, loves keeping fit.

Over the past few months, he’s been training hard for the First Tri Lydney Olympic triathlon, which will take place on Sunday 27 April in the Forest of Dean.

This challenging race includes a 750-metre swim, a 43-kilometre cycle, and finally, a 10-kilometre run.

What’s more, this is just the first of a series of sporting events Adrian will be taking part in this summer – watch this space for more updates!

Get in touch

If you’d like to find out more about getting involved with the boat trip or supporting Adrian in his charity triathlon, we’d love to hear from you.

And as always, if you have any questions about Blue Wealth and how we can support you with all your financial planning needs, please get in touch.

Please email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

After Rachel Reeves’ impactful first Budget in autumn 2024, you might have been concerned about the announcements that would be included in her Spring Statement on 26 March 2025.

Reassuringly, the major headline from this year’s springtime fiscal event is that Reeves made few announcements that are likely to affect you and your personal finances directly. Although, it did reveal that none of the changes made in the Autumn Budget would be overturned. However, one significant change has been made to the High Income Child Benefit Charge, which could affect you or your family.

The chancellor did announce that, due to global uncertainty and after the economy declined in January, the Office for Budget Responsibility (OBR) has downgraded its 2025 forecast for UK growth from 2% in October 2024 to 1% as of March 2025. She also noted the OBR’s long-term forecast, indicating that growth would increase for each year remaining in this parliament.

In addition to growth figures, the chancellor’s Statement introduced a range of measures designed to increase economic activity in the UK, as well as cost-saving initiatives, predominantly at state level, to reduce government debt.

Read on for your summary of the chancellor’s 2025 Spring Statement.

Personal tax thresholds and allowances are set to remain unchanged

Those who were concerned the chancellor would announce sweeping changes that might affect their personal finances will be breathing a sigh of relief as many worries didn’t materialise.

Personal tax

Reeves stuck to a pre-Spring Statement commitment to not increase personal taxes.

So, Income Tax thresholds and rates will remain unchanged, and thresholds are frozen until April 2028. As a result, your Income Tax liability is likely to rise in real terms.

Similarly, the rates and thresholds for paying Capital Gains Tax (CGT) and Dividend Tax will remain the same.

Individual Savings Accounts (ISAs) 

Before the Spring Statement, the government was reportedly considering reducing the amount you can tax-efficiently place in a Cash ISA each tax year to £4,000 in a bid to encourage greater investment.

The good news is the ISA subscription limit will remain at the current level (£20,000) in the 2025/26 tax year. The ISA subscription limit is frozen until 2030.

The Junior ISA (JISA) allowance will remain at £9,000 in 2025/26.

However, the government did note it will continue reviewing ISA reform options to improve the balance between cash and equities to earn better returns for savers, boost the culture of retail investment, and support its growth mission.

Pensions

Last year, the government announced a new Pension Schemes Bill, which will legislate several areas of pension policy. However, further reforms weren’t announced in the Spring Statement.

The Annual Allowance will remain at £60,000 in 2025/26. Your Annual Allowance may be lower if your income exceeds certain thresholds or you have already flexibly accessed your pension.

As usual, there was also speculation that the amount you could withdraw from your pension tax-free would be reduced, but this has remained unchanged. So, when you reach the normal minimum pension age (55, rising to 57 in 2028), you may withdraw up to 25% of your pension (up to a maximum of £268,275) before paying Income Tax.

State Pension

As expected, there were no announcements relating to the State Pension or the triple lock, which guarantees the State Pension will increase every tax year by either the rate of inflation, average earnings growth, or 2.5%, whichever is higher.

As a result, the full new State Pension will pay a weekly income of £230.25 in 2025/26.

High Income Child Benefit Charge reforms will come into place this summer

Although the chancellor did not explicitly announce the change, the Spring Statement document revealed that those who pay the High Income Child Benefit Charge will be able to do so through PAYE from summer 2025.

As it stands, those who pay the charge need to register for self-assessment to do so, even if they do not otherwise need to self-assess. But this year, the government is making it easier for families to pay the charge without needing to submit a tax return.

Inflation is forecast to meet the Bank of England’s 2% target by 2027

After reaching a 40-year high of 11.1% in October 2022, inflation, as measured by the Consumer Prices Index (CPI), has gradually fallen, bringing it closer to the Bank of England’s (BoE) target of 2%.

The chancellor announced in her Statement that in the 12 months to February 2025, inflation rose by 2.8%, down from 3% in January. Now that inflation is better under control, the BoE has cut its base rate three times since the general election, bringing the rate down from 5.25% to 4.5%. These cuts mean borrowers will likely pay less while savers may see their interest payments fall.

It was then announced that, according to the OBR’s forecast, inflation will average:

• 3.2% in 2025
• 2.1% in 2026
• 2% in 2027, 2028, and 2029 – the BoE’s target rate.

The key fiscal announcements from the 2025 Spring Statement

The chancellor’s speech largely revolved around changes to government spending and investment. Some of the key measures and announcements included in the Statement were to:

• Increase defence spending to 2.5% of GDP by 2027, including providing an additional £2.2 billion to the Ministry of Defence next year
• Rebalance payment levels in Universal Credit to incentivise people into work, and review the assessment for Personal Independence Payments, with the OBR stating these changes will save £4.8 billion from the welfare budget in 2029/30
• Crack down on promoters of tax avoidance schemes, as initially announced in the Autumn Budget in October 2024
• Invest £2 billion in social and affordable housing, so housebuilding reaches a 40-year high that helps put the government on track to reach its target of building 1.5 million homes by the end of this parliament
• Introduce a £3.25 billion Transformation Fund to streamline public services using technology and Artificial Intelligence, making the government “leaner and more efficient”. Additionally, government departments will reduce their administrative budgets by 15% by the end of the decade.

2024 Autumn Budget changes remain intact

In October 2024, the chancellor announced a series of tax-raising measures during the Autumn Budget, some of which could have affected your personal finances. These included:

• Inheritance Tax (IHT) will be levied on unused pension benefits from April 2027.
• Agricultural Property Relief and Business Property Relief will be reduced from April 2026.
• CGT rates for non-property gains were raised in line with property rates with immediate effect, and Business Asset Disposal Relief and Investors’ Relief were both reduced.
• Employer National Insurance contributions (NICs) will rise from April 2025, from 13.8% to 15%, and the threshold at which employers start paying NICs will also fall.
• Income Tax thresholds will remain frozen until 2028.
• The IHT nil-rate bands will remain fixed for a further two years, until 2030.
• VAT was levied on fee-paying schools, effective from 1 January 2025.
• The non-dom tax regime is set to be abolished from April 2025.
• The Stamp Duty Land Tax surcharge on second home purchases rose from 3% to 5% from 31 October 2024.
• Corporation Tax is now capped at 25% for the duration of the parliament.

While many hoped the chancellor would row back on some or all of these measures, all remain intact.

Please note

All information is from the Spring Statement documents on this page.

The content of this Spring Statement summary is intended for general information purposes only. The content should not be relied upon in its entirety and shall not be deemed to be or constitute advice.

While we believe this interpretation to be correct, it cannot be guaranteed and we cannot accept any responsibility for any action taken or refrained from being taken as a result of the information contained within this summary. Please obtain professional advice before entering into or altering any new arrangement.

You’ve probably noticed that the Blue Wealth team loves sport, and we’re dedicated to supporting our local community.

So, what better way to combine the two than by sponsoring a local football team?

Keep reading to find out more.

A little bit about Torpedo AFC

Torpedo AFC is a Bristol-based senior football team (for players aged 16 and over) that was established in 1966.

The club is represented by four teams in the Bristol Downs Association Football League, with one team in each of the league’s four divisions. This is a standalone amateur league that was founded in 1905 and sits outside the traditional English football league pyramid.

The league has a unique format where all games are played on the same grounds – Clifton Down and Durdham Down (“The Downs”). We can’t wait to drop by and see the team in action!

Past successes and upcoming fixtures

The club has a long and proud history, and we’re excited to support them. Here are just a few of their many achievements to date:

• Rising through the ranks of the Bristol Downs Association Football League to achieve entry into the First Division
• Winning the Division 1 Championship in the 2015/16 season
• Winning the All Saints Cup in 2023/24.

The club’s promotion to and consistent presence in the top division of their local league shows the level of the players’ commitment and success.

If you’re keen to see Torpedo AFC in action, they play every Saturday (between September and April) on the Bristol Downs. So, when you next have a free weekend, pop by and cheer the team on. If you spot one of the Blue Wealth team on the sidelines, be sure to come and say hello.

The Blue Wealth kit

The Bristol Downs League has been uniting families, friends and the community for the last 120 years. So, when we got the chance to sponsor Torpedo AFC by providing their new kit, we were thrilled.

If you’re lucky enough to see the team play, you might spot the Blue Wealth name on the players’ shirts. As you can see from the photo – it looks great!

Our managing director, Rob Bowers said, “We are keen to support local events including amateur sport. With the Bristol Downs League venue only a 1/4 mile from the Blue Wealth office, supporting one of the teams in this grassroots football league seemed an obvious choice.”

If you’d like to find out more about the wonderfully unique Bristol Downs Football League, check out the fantastic nine-episode BBC podcast, Always at Home: Bristol’s Beautiful Game.

And as always, if you have any questions about Blue Wealth and how we can support you with all your financial planning needs, we’d love to hear from you.

Please email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

In our October team update, we introduced you to our new charity partner for the year, Community of Purpose.

This award-winning, not-for-profit social enterprise offers a range of programmes to engage and support young people in Bristol.

We recently held a wine-tasting event in Clifton to show our appreciation for our clients while also raising funds for this meaningful cause, and we can’t wait to tell you all about it…

An evening of wine, celebration, and socialising

On Wednesday 27 November, the Blue Wealth team joined 50 clients and contacts for a wonderful wine-tasting event at Averys in Bristol.

This client appreciation evening was a great opportunity to get together, have fun, and raise money for Community of Purpose.

The event kicked off with a champagne reception, followed by an introduction from the Blue Wealth team. We were exceptionally proud to take to the stage and celebrate our recent inclusion in the New Model Adviser (NMA) Top 100 for the first time.

Next, the wine tasting began. We enjoyed three white wines, accompanied by a delicious selection of cheese and meats.

Halfway through the evening, Amy Kingston, the co-founder of Community of Purpose, gave an informative and insightful talk about the charity’s work. She also shared details about how to donate to this worthy cause.

Amy’s speech about all the great work her charity does for children in Bristol was truly inspirational and we have had lots of positive feedback.

We rounded off the event with three beautiful red wines. Again, these were sampled alongside some tasty cheeses and meats.

Thank you to all those who attended and made this a special evening. We’re looking forward to seeing you at our next event and raising more funds for our worthy charity partner.

Get in touch

If you’d like to talk to us about our charity fundraising, future events, or how we can work with you to meet your financial planning needs, we’d love to hear from you.

Please email us at hello@bluewealth.co.uk or call us on 0117 332 0230.

Putting your feet up and indulging in a festive film or two is a perfect way to relax, spend time with family, and enjoy the Christmas holidays.

You probably have a few favourites you like to watch each year. Whether they make you laugh or cry, these classics entertain you every time.

But did you know that many of these films you love so much could also offer invaluable financial lessons?

Read on to find out what three of the most popular Christmas films could teach you about managing your wealth in 2025 and beyond.

1. Home Alone – Preparing for the unexpected could provide valuable financial security

Released on 7 December 1990, Home Alone has become a modern Christmas classic enjoyed by children and adults of all ages.

The film tells the story of eight-year-old Kevin McCallister, who is accidentally left behind when his family go on holiday over Christmas.

At first, Kevin is delighted to have the house to himself and enjoys the freedom of eating ice cream in bed and watching whichever films he likes.

Yet soon, a pair of hapless burglars attempt to break into the property believing it to be empty. Kevin must then protect his home by creating a range of elaborate DIY booby traps to send the criminals on their way.

As well as being hugely entertaining, the film contains several valuable messages about protecting your finances against the potential effect of unexpected events.

When Kevin finds himself alone, he has no money or resources to buy everyday essentials, such as food and laundry detergent. Fortunately, he discovers his brother Buzz’s secret stash of cash, which Kevin uses to stock up with supplies.

This highlights the importance of keeping an emergency fund. Kevin was lucky that Buzz had saved some money. Without these funds, he might have gone hungry until his parents returned.

Additionally, Kevin’s meticulous preparation of his family’s home ahead of the burglars’ return allowed him to ward off the thieves.

In the same way, by planning ahead and putting financial protection in place, you could ensure that you and your loved ones are provided for if something unexpected occurs.

For example, investing in income protection now could give you the means to cover day-to-day costs such as utility bills and mortgage payments if you are unable to work due to illness or injury.

2. A Christmas Carol – Learning from the past and looking ahead could help you plan for the future you desire

Charles Dickens’ classic tale was first published in 1843 and has since been adapted for the big screen on multiple occasions.

Whether you prefer the 1951 film starring Alastair Sim, the 80s comedy Scrooged featuring Bill Murray, or the 90s musical The Muppet Christmas Carol, the story of Ebenezer Scrooge is probably one you’re familiar with.

Yet perhaps you’re less aware of an instructive financial planning tip hidden in the storyline.

When Scrooge is visited by three ghosts on Christmas Eve, he is given an invaluable insight into his past, present, and future. By reflecting on his behaviours and looking forward to what might lie ahead, the miserly old man realises the error of his ways and takes steps to change his future.

Similarly, when it comes to your finances, reviewing past behaviours and thinking carefully about what you want in the long term could help you craft a plan that aligns with your goals.

While you may not receive a visit from the Ghosts of Christmas this festive season, a financial planner could offer just the help you need.

By using cashflow modelling, a financial professional can paint a clear picture of how your wealth might look in years to come, based on factors such as your income, outgoings, investment returns, and so on.

This could help you assess whether you’re on track for the future you desire, and if not, adapt your plan accordingly. For example, you might decide to increase your pension contributions or change your investment strategy to ensure that you can retire early without running out of money.

3. It’s a Wonderful Life – A fresh perspective might help you overcome difficult times

It’s a Wonderful Life has become a “must-watch” film at this time of year.

The story begins on Christmas Eve, with troubled businessman George Bailey looking forlornly at his life and feeling that he has nothing to contribute to the world. As his company is in financial trouble, all he sees is problems.

Thankfully, George is visited by his guardian angel, Clarence, who shows him all that he has contributed to his community and family. As a result, George comes to appreciate all that he has and could have in the future, and that it truly is a “wonderful life”.

Just like George, if you’re facing difficult financial times, you might find it hard to stay positive.

For example, if the value of your investments falls due to a dip in the market, you might rush to sell your shares for fear of further losses. Yet, a downturn is unlikely to last indefinitely, and markets typically recover over the long term.

However, it can be hard to hold your nerve and avoid emotional decision-making if you’re facing financial challenges.

That’s why working with a financial planner can be so beneficial.

A financial professional can act as an objective sounding board, providing a fresh perspective if you can’t see a way forward. They have the knowledge, skills, and resources to guide you towards data and logic-informed decisions.

Think of your financial planner as your Clarence – a guardian angel who is there to provide the insight you need to banish your negativity and realise the wonderful possibilities in your future.

Get in touch

If you’d like help getting your finances in order ahead of the festive season and beyond, we can help.

Please email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

The content of this newsletter is offered only for general informational and educational purposes. It is not offered as, and does not constitute, financial advice.

Blue Wealth Ltd is not responsible for the accuracy of the information contained within linked sites.

Blue Wealth Ltd is an appointed representative of Best Practice IFA Group Ltd, which is authorised and regulated by the Financial Conduct Authority.

The Financial Conduct Authority does not regulate cashflow planning.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Note that financial protection plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.

Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product provider and will be explained within the policy documentation.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

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It’s not hard to argue that winter is a magical period. In northern hemisphere countries like here in the UK, it’s the time of year when cities sparkle with festive lighting, snow dusts dramatic landscapes, and much of the globe slows down to celebrate what is really important to them.

While some people might enjoy spending this time at home relaxing and preparing for Christmas, others dream of visiting exciting new areas of the world, whether that’s a northern winter wonderland or a blissful sunny escape in the southern hemisphere.

If you’re searching for some holiday inspiration for a last-minute trip this year or are already thinking about your plans for 2025, this guide could help you identify your next destination. Find out more about why you might want to plan a visit to:

1. Lapland, Finland
2. Quebec City, Canada
3. New York City, USA
4. Blue Lagoon, Iceland
5. St Moritz, Switzerland
6. Bariloche, Argentina
7. Sapporo, Japan
8. Queenstown, New Zealand
9. Bruges, Belgium
10. Tallinn, Estonia

Download your copy here: ‘10 of the world’s best destinations to travel to during winter in the UK’ to discover exciting new destinations now.

If exploring the world or jetting to new places to relax is a priority for you, we could help you make it part of your financial plan. Please get in touch to talk to us.

Leaving wealth behind for your loved ones may be a priority when developing your financial plan. After all, you’ll likely want to see your family thrive and an inheritance could help them achieve important goals in life.

Traditionally, you would transfer wealth to your loved ones when you passed away, leaving instructions in your will about how your family should divide your estate.

However, in recent years, more people have chosen to instead leave a “living legacy” – passing wealth to their loved ones while they’re still alive.

This informative guide explains why a living legacy could help you:

• Encourage your beneficiaries to think about their long-term finances
• Lend a helping hand to loved ones when they need it most
• Reduce a potential Inheritance Tax bill on your estate
• Offer valuable support around how to use the wealth.

As well as the potential benefits, this guide also considers the downsides you might need to consider, such as making estate planning more complex and balancing gifts with your own long-term financial security.

Download your copy here: ‘The surprising benefits of choosing a “living legacy” for your loved ones’ to find out more now.

If you want to discuss ways to pass wealth to your loved ones while ensuring that you can meet your own financial goals, please contact us to arrange a meeting.

We are extremely proud to announce that Blue Wealth has been named one of the top financial planning firms in the UK by New Model Adviser (NMA) for the first time.

This recognises the hard work and dedication the team puts in every day to deliver a consistently excellent service to our clients.

Read on to find out more about the annual NMA Top 100 and why we’ve been included.

The NMA Top 100 recognises outstanding contributions to financial planning

The NMA Top 100 is an annual list compiled by Citywire New Model Adviser, a well-regarded publication in the financial advice sector.

Only the best firms that demonstrate innovation, client-centred approaches, and outstanding contributions to financial planning are included.

Firms are evaluated based on rigorous selection criteria including business growth, investment in technology, professional development, and client impact.

They must also demonstrate ethical practices, efficient service delivery, and long-term client success.

As you can see, NMA sets the bar high. To be included in this prestigious list, firms must go above and beyond “business as usual” by positioning themselves as leaders in the sector and proactively setting new standards in financial planning.

So, needless to say, we’re thrilled to make the 2024 NMA Top 100. Being featured is a mark of distinction that showcases our commitment to quality and excellence.

Blue Wealth is recognised for its unique approach and dedication to investing in people

Blue Wealth was selected for the NMA Top 100 because of our “excellent, “interesting”, and “alternative” proposition.

We know that innovating and setting ourselves apart is essential if we want to keep pace with the ever-changing landscape of financial planning.

NMA also recognised the significance of our contribution to clients and the sector, and our ongoing investment in the team.

As we’ve shared in a previous team update, Blue Wealth has supported two of its employees to achieve Chartered financial planner status through the Chartered Insurance Institute (CII).

People – both staff and clients – are at the heart of what we do, so we’re delighted to receive this recognition.

Get in touch

If you’d like to learn more about how our exceptional, NMA Top 100 firm can help you with all your financial planning needs, please get in touch.

Email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

The content of this newsletter is offered only for general informational and educational purposes. It is not offered as, and does not constitute, financial advice.

There have been lots of exciting developments at Blue Wealth this month.

We are constantly striving to move the business forward and embrace change, so we can’t wait to share this update with you.

We’ve moved into a shiny new office in Clifton

We’re a small, independent firm that thrives on its interactions with the local community in Bristol and the surrounding areas.

Our headquarters are where we meet with you and have the conversations that help you achieve your goals. In short, it’s where the magic happens!

As the business has gone from strength to strength, we have outgrown our offices in Westbury on Trym. So, we’re thrilled to announce that we’ve moved into a shiny new office in Clifton.

The new premises offer more space and we’re closer to our professional contacts, which means that we’ll have greater flexibility in how we support our clients.

While relocating is always a significant transition, we’re delighted with how smoothly things have gone, thanks to a team of professional movers – and of course, the dedicated and hard-working Blue Wealth team.

We’re looking forward to welcoming you to our new offices, and hope you’ll enjoy the lively atmosphere and proximity to fantastic local amenities as much as we do.

Please join us in welcoming Deb to the team

We’re always happy to see the Blue Wealth team expanding and developing, and this month Deb, Rob’s wife, joined us as a paraplanner.

Deb brings a wealth of experience and expertise to the firm. She is highly qualified in financial planning (diploma level) and has built impressive recommendations for clients over several years.

Before joining the Blue Wealth family, Deb ran her own paraplanning business, outsourcing to a wide range of financial planning businesses.

When she’s not busy working in our lovely new office, Deb enjoys, Deb enjoys spending time with her family, socialising with friends, keeping fit, and going on holiday.

Blue Wealth has renewed its Chartered status

We have successfully renewed our Chartered status with the Chartered Insurance Institute (CII), which is a symbol of quality and trust.

Chartered status is the gold standard of our profession, so successfully completing the renewal process demonstrates our ongoing commitment to excellence.

To renew our status – which we originally achieved around four years ago – we were required to provide evidence that we’re still achieving the standards set, including maintaining the highest levels of qualification throughout the team.

So, renewing our status is extremely valuable to us and our clients, giving you the confidence that you’re working with an experienced team of professionals committed to excellent service standards.

Get in touch

If you’d like to check out our new offices and have a chat about how the Blue Wealth team can help you with all your financial planning needs, we’d love to hear from you.

Please email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

The content of this newsletter is offered only for general informational and educational purposes. It is not offered as, and does not constitute, financial advice.

Wednesday 13 November marked World Kindness Day, which aims to celebrate the positive effect that kindness can have on individuals, communities, and the world at large.

So, it’s a perfect time to consider using some of your wealth to help others, for example, by donating to charity or supporting your loved ones.

Such generosity may not only benefit your chosen recipients, but it could also give your finances and emotional wellbeing a boost.

Read on to discover three lovely benefits of sharing your wealth this World Kindness Day and beyond.

1. Help your loved ones when they need it the most

You might have plans to leave your loved ones an inheritance when you pass away. Indeed, creating a will and updating it periodically is a sensible way to protect your wealth and provide for those closest to you after you’re gone.

Yet, with people living longer on average than they have done in previous generations, your beneficiaries could be at retirement age by the time they inherit.

On the other hand, passing on some of your assets during your lifetime could allow you to support your friends and family when they need it the most.

For example, your children may require more financial help when they’re starting out in life – getting married, buying their first home, and so on. This may be especially true during the current economic climate.

According to BBC News, first-time buyers are facing the toughest conditions in 70 years, and they are increasingly reliant on parental support.

What’s more, figures published by the Office for National Statistics (ONS) reveal that between July and October 2023, around 1 in 4 adults reported struggling to afford rent or mortgage payments due to the cost of living crisis. Additionally, 1 in 4 adults said they would not be able to save money in the next 12 months.

So, “giving while living” could be much more meaningful for your loved ones than leaving them an inheritance they may not receive until they’re in their 60s or 70s. You’ll also have the joy of seeing them benefit from your wealth during your lifetime.

2. Reduce a potential Inheritance Tax bill for your heirs

In the Budget, which was announced on 30 October 2024, the chancellor extended the freeze on tax-free Inheritance Tax (IHT) nil-rate bands until 2030.

Your assets, including your property, could continue to increase in value over time. So, thresholds not rising with inflation could mean that your estate is liable for IHT when you die, or that your beneficiaries may face a higher IHT bill than you might have planned for.

Additionally, from April 2027, your pension assets will likely be considered part of your estate for IHT purposes. Currently, you can usually pass on your pension without the recipient incurring IHT.

Fortunately, you could reduce the size of your estate for IHT purposes by carefully navigating gifting rules, so that your loved ones receive more of your wealth.

Here are three helpful ways to gift money tax-efficiently.

Use your annual gifting exemption

In the 2024/25 tax year, you can give IHT-exempt gifts of up to £3,000 – or £6,000 as a couple – to one or more people.

If you have unused annual exemption from the previous tax year, you can carry this forward for one year.

In addition to your annual gifting exemption, in 2024/25, you can also make tax-free gifts for individuals you know who are getting married. This is up to:

• £5,000 to a child
• £2,000 to a grandchild
• £1,000 to anyone else.

You can also make as many gifts of up to £250 each as you like, provided that you haven’t made a gift to the same person using another exemption.

Give additional gifts as potentially exempt transfers

If you use up the gifting exemptions outlined above, you can give further gifts as “potentially exempt transfers” (PETs).

Any PET you make only becomes free from IHT if you survive for at least seven years after giving the gift. If you die before this, a sliding scale known as “taper relief” may be applied to determine the amount of IHT payable. In general, the sooner you die after making the gift, the higher the rate of IHT.

So, sharing some of your wealth earlier in life could allow your heirs to enjoy more of their inheritance.

Bear in mind that that taper relief only applies to gifts in excess of your nil-rate band. So, if your gifts don’t exceed your nil-rate band and you have sufficient threshold remaining, PETs will be the first part of your estate calculated against this.

Gift from surplus income

Under the “gifting from surplus income” rule, you could gift wealth directly from your income to whoever you’d like, without any IHT liability.

Theoretically, there is no limit to how much of your wealth you can share in this way, provided that your gifts meet three key criteria:

• You make regular payments, rather than a one-off gift
• The funds you give come from income, not capital assets
• You can maintain a reasonable standard of living while giving the gifts.

For example, you might choose to cover the cost of your grandchild’s school fees or pay for an elderly relative’s residential care.

The rules on gifting out of income can be complicated, so you may benefit from working with a financial planner who can help you understand your options.

3. Support a worthy cause

Alongside sharing your wealth with those closest to you might allow you to see the benefits and joy, gifting to charity may be equally rewarding.

What’s more, if you have a cause that’s close to your heart, your support may be more important than ever. Research published by the Charities Aid Foundation (CAF) has revealed that fewer people are regularly donating to charity than before the coronavirus pandemic.

So, gifting to your favourite charity could help it raise crucial funds for continuing its important work.

Additionally, if you’re a higher- or additional-rate taxpayer living in England, Wales, or Northern Ireland, you could claim tax relief on any donations you make through Gift Aid to reduce your Income Tax liability.

Alternatively, you might choose to leave a charitable legacy in your will. Not only could this provide invaluable support to a good cause, but it could also reduce the amount of IHT your beneficiaries pay when they inherit your estate. This is because donations to a registered charity usually fall outside of your estate for IHT purposes.

Furthermore, if you leave at least 10% of your net estate to charity, you may qualify for a reduced IHT rate of 36%, compared to the standard rate of 40% (2024/25). This could allow you to support a worthy cause, while also reducing the IHT bill your loved ones could face.

Get in touch

If you’d like help making the most of your wealth, both now and in the future, we can help.

Please email hello@bluewealth.co.uk or call us on 0117 332 0230.

Please note

The content of this newsletter is offered only for general informational and educational purposes. It is not offered as, and does not constitute, financial advice.

Blue Wealth Ltd is not responsible for the accuracy of the information contained within linked sites.

Blue Wealth Ltd is an appointed representative of Best Practice IFA Group Ltd, which is authorised and regulated by the Financial Conduct Authority.

The Financial Conduct Authority does not regulate estate planning, tax planning, or will writing.

Remember that taper relief only applies to gifts in excess of the nil-rate band. It follows that, if no tax is payable on the transfer because it does not exceed the nil-rate band (after cumulation), there can be no relief.

Taper relief does not reduce the value transferred; it reduces the tax payable as a consequence of that transfer.

Approved by Best Practice IFA Group Limited on 20/11/2024