Author: Rob Bowers

When you think about financial planning, you’ll likely immediately conjure thoughts of pensions, ISAs, investment portfolios, and tax planning. Not to mention the high possibility of paperwork.

Yet these financial products are simply the tools used to help you achieve your life goals.

Ultimately, financial planning is all about you, your life, and your long-term aspirations.

In recognition of World Financial Planning Day on 1 October, read on to learn more about how working with a financial planner could help to make a big difference to your life and happiness, as well as influencing your potential wealth.

Conversations with a lifestyle financial planner can bring clarity for your future

One of the first conversations you’ll have when you meet with any good financial planner will be about your life. They will want to understand your responsibilities, priorities, long-term goals, and what in life makes you happy.

As such, instead of asking about the size of your mortgage or how much you’ve saved into your pension, expect questions like:

• What is your life like now?
• What makes you happy?
• What matters to you most?
• How would you like your life to look in the future?

The hectic pace of life means that many people fail to slow down long enough to consider questions like this.

If this is the case for you, your Blue Wealth planner will chat with you and ask a series of exploratory questions to help you set goals that truly matter to you. Once we know you better, understand your current circumstances, and appreciate your aspirations, we’ll explain the ways we could help make your dreams a reality.

These first steps of your financial planning journey are essential in achieving your long-term goals.

Setting goals can help you manage your money better

A clear understanding of your short-, medium-, and long-term goals can help you stick to your financial objectives.

And science proves it.

According to research conducted by experts at the University of Stirling, goal setting is key to successful saving.

After analysing a large sample of UK household data from the Office for National Statistics Wealth and Assets Survey, researchers found that “setting goals, alongside having confidence in your numerical ability and using professional financial advice, were all more likely to make you a successful saver”.

The study also revealed that people without access to financial advice are less likely to have any equity investments. Consequently, these people are “less likely to hit their long-term savings objectives”. For this group of people, setting goals is arguably even more crucial.

Setting goals that matter to you is believed to give the “greatest potential benefit” for your savings.

Practical goals are good but exciting life goals matter, too

While it’s useful to create practical goals that you wish to work towards, such as paying off your mortgage, helping your children through university or onto the property ladder, it’s equally important to consider what lights a fire in your belly.

What’s topping your bucket list? Do you wish to travel to far-flung countries, start a business, or buy a home abroad?

Once you understand your goals and can prioritise them, it’s time for pensions, ISAs, equity investments, and tax planning to come into play.

Your financial planner will use a selection of investment products to devise a financial plan that puts your money to work to help you attain your dreams. So, you can rest assured that you’re on course to pursue what makes you happy.

Read more: The true value of personal financial advice, revealed

Creating a solid financial plan and sticking to it could help you achieve your goals and reduce stress. Ultimately, a bespoke financial plan tailored to your unique circumstances and aspirations could lead to a happier and more fulfilling life.

Blue Wealth clients share the benefits of financial planning

Of course, many of our clients already understand the benefits of financial planning.

For instance, Steve and Jayne have said that working with us has helped put their mind at ease.

Meanwhile, both Marcus and Dave have enjoyed greater financial confidence. Dave, in particular, is happy that he’s able to “travel and enjoy … life without worrying about money”.

Hear complete client stories on our website.

Get in touch

If you’d like to explore some of the different ways we may be able to help you achieve your life goals and aim towards ticking off your top bucket list items, 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.

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

The Financial Conduct Authority does not regulate tax planning.

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.

On 3 August 2023, the Bank of England (BoE) raised the base interest rate from 5% to 5.25%, a level last seen 15 years ago, in February 2008.

The good news is that the 14th successive rise since December 2021 wasn’t as steep as the 0.5% increase the BoE made in June, indicating that the successive rate rises are having the desired effect on inflation.

Indeed, in the year to June 2023, the UK inflation rate was 7.9%, down from the 41-year high of 11.1% in October 2022.

Historically, when inflation starts to rise too much, interest rates are increased as it helps deal with one of the main drivers of inflation: consumer demand. This is because higher interest rates encourage people to save their money instead of spending it on goods.

In time, this should help bring down the price of goods and services, thereby lowering inflation.

The chart below tracks inflation and interest rates from January 2018 to May 2023. The blue line represents the level of inflation. You can see that increasing interest rates started to have the desired effect in October 2022.

Source: Statista

With all this in mind, how could rising interest rates affect you and your money?

Good news for savers

Interest rate rises are good news for savers, as they usually result in higher savings rates offered by banks and building societies.

According to Moneyfacts, the highest interest rate on an easy access savings account as of 7 August 2023 was 4.65%.

While banks are generally good at passing rate rises down to consumers, the interest you can earn on your savings is still less than the rate of inflation.

It’s wise to keep a pool of money in an easy access account as a ready emergency fund, but holding more cash in the bank than you truly expect to spend, isn’t necessarily the best course of action. This is because, over time, the effects of inflation can harm the real term value of your cash.

Your circumstances will dictate how much you might want to hold in cash. We can help you understand the balance that might suit you and explain alternative ways to grow your savings and work to prevent your buying power being diminished by inflation each year.

Watch out for potential Income Tax charges on interest earned

Everyone has a Personal Savings Allowance (PSA) that limits how much interest you can earn before having to pay Income Tax.

Now that the base rate has climbed to 5.25%, it’s likely that your cash savings are earning substantially more in interest than they were a year ago. If you have a lot of cash in the bank, this uptick could increase the chance of you incurring an unwelcome tax charge.

In 2023/24, the PSA allows:

• Basic-rate taxpayers to earn £1,000 interest during the year before paying Income Tax.
• Higher-rate taxpayers to earn £500 before paying Income Tax.

Any interest earned that exceeds your PSA will be liable to Income Tax at your marginal rate.

If you’re an additional-rate taxpayer, you do not have a PSA. This means that any interest you earn on your cash savings is taxable at 45% in the 2023/24 tax year.

If you are unsure whether you might have to pay tax on interest you earn following the spate of interest rate rises, please get in touch. We’ll help you understand your situation and discuss alternative options for your cash savings.

Investing with a long-term view could beat interest rates on savings and help protect your buying power

Over time, investing in the stock market can be a good way to hedge against the effects of inflation.

While equity investments will always be affected by short-term fluctuations, if you remain calm and hold a diverse portfolio, investing could help protect your wealth from the eroding effects of inflation.

For example, Times Money Mentor reports that, as of June 2023, over the past 30 years, with dividends reinvested, the average annual return for the FTSE 100 was 7.3%. This compares favourably to the 2.1% average annual growth in inflation over the same period.

Remember though, past performance is not a reliable indicator of future performance.

The typically positive compounding effects of equity investments is one of the most popular reasons to work with a financial planner.

After understanding your circumstances and goals, we can help you build a well-diversified portfolio that considers your risk profile and takes a holistic view of your financial situation.

Your retirement income could be affected

If you’re approaching retirement or have already retired, you may have concerns about how your pension might be affected by rising interest rates.

The effect of the rate rises will depend on how your pension is invested.

Many pension funds are at least partially invested in bonds, which often fall in value when interest rates increase. As a result, during times of higher interest rates, you may find that your pension pot doesn’t grow as quickly as you might like.

One way to benefit from higher interest rates might be to buy an annuity.

According to a PensionsAge report, annuity rates have increased by 20% in the 12 months to June 2023. Since the start of 2022, the total increase adds up to 48%.

An annuity can be a helpful way to secure a guaranteed income in retirement. However, this solution may not be suitable for everyone and can’t be changed once you’ve purchased it, making it crucial to speak with your financial planner before you commit to a deal.

Get in touch

If you’re concerned about how the recent interest rate rise will affect your finances or want to find out how you can make the most of the options available to you, we’re here to help.

Email us at 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.

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.

Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.

The Financial Conduct Authority does not regulate tax advice.

The value of your investment 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.

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.

5 September marks International Day of Charity. Launched in 2012 by the United Nations, charitable organisations around the world use the designated day to raise awareness about the importance of charity, volunteering, and philanthropy.

The day coincides with the anniversary of Mother Theresa’s death, creating a lasting legacy to promote and celebrate the positive effects that charitable work can have on a variety of important causes.

Giving is good for everyone

When you think about being charitable, your thoughts are likely to focus on how your time, money, or fundraising efforts can benefit others.

Yet research reveals that acts of kindness and giving is as good for you as it is for those you choose to support.

In fact, science has proved that donating your time and money to charity can:

1. Boost your mood
2. Lead to better health
3. Strengthens social connections.

Every year, the Blue Wealth team raise money to support a charity of your choosing

In August 2022, you voted to support homeless charity BillyChip.

From the shortlist of eight local charities that we thought deserved our support, you voted resoundingly in support of BillyChip.

Established in 2018, the Bristol-based charity works to continue the legacy of Billy Abernethy-Hope.

After helping support the homeless one Christmas, Billy felt disheartened at how little support the public gave to local homeless people. Although many people donate to charity on a regular basis, Billy was surprised by how few donations were given directly to people who were living rough on the streets.

Billy put this down to the fact that people can feel awkward engaging with a homeless person, even when offering a donation of food or a drink. So, he created the BillyChip, “a positive currency that can’t be misused”.

A small act of kindness that helps break down barriers, the distinctive blue BillyChips can be given to homeless people to allow them to purchase food and drink from takeaways and coffee shops.

This helps people give money directly to those who need it. As such, BillyChip not only helps people in need, but also helps to build better communities within our towns and cities.

All the ways Blue Wealth have supported BillyChip with your help

Over the last year, we’ve supported BillyChip in a variety of ways:

• We donated £50 every time we had an initial meeting following a client referral.
• In September 2022, Dan Britton and Adrian Thorley took part in the gruelling 66-mile Great Exmoor Ride from Taunton to Blue Anchor on the West Somerset coast.
• Dan ran the Bristol half marathon.
• In June 2023, Adrian took part in two charity bike rides in quick succession: the Mendips Lakes and Lumps, cycling 43 miles through the Mendips, followed by a 100-mile ride through Devon when he took part in The Nello, two weeks later.
• Adrian also took to his bike and cycled in the Great Western Ride, in July 2023.

Thanks to your generosity in recommending us to your family and friends, we’ve taken on 19 new clients and donated a total of £950. Combined with the many sporting events we’ve taken part in, over the year, we’ve donated more than £1,800 to BillyChip.

BillyChip showed us their gratitude with a couple of social posts, saying: “We want to say a big thank you to the team at Blue Wealth […] Each donation makes a big difference to how we operate and means we can continue to do the work that we love and expand the BillyChip into new areas to help support our community.”

A thank you from the Blue Wealth team

Thank you so very much for your enduring support – it means the world to us.

That we can use our expertise to help you reach your goals while also supporting those less fortunate is a true privilege and we couldn’t do it without you.

We’ll be in touch soon to ask you to help us choose our next charity partner so we can continue our good work while supporting a great cause.

Thank you, from all of us at Blue Wealth x

Ensuring your family is financially secure for the long term is a common goal. If it’s one of your priorities, intergenerational wealth planning could help you create a plan that suits you and your loved ones.

There’s more than one way to pass on wealth to your family. Each option has advantages and drawbacks that you need to weigh up to understand what’s right for you and your beneficiaries. This useful guide covers three main options:

1. Gifting assets during your lifetime
2. Using a trust to pass on wealth
3. Leaving an inheritance

The guide also explains some of the key things you need to consider before you pass on wealth. For instance, if you gifted assets now, could you face financial insecurity later in life? Or could your estate be liable for Inheritance Tax when you pass away?

You can also read about the benefits of involving your family in the financial planning process. From facilitating money conversations to helping you identify tax allowances you could use, it may help your wealth go further.

Download your copy of ‘Intergenerational wealth planning: Your options when passing on wealth to the next generation’ now to read more about creating a plan that suits your family.

It’s never too soon to start thinking about how you want to pass on wealth or who you want to benefit from your assets.

If you have any questions about intergenerational wealth planning, please contact us.

Each month, we share some of the highlights of what’s been happening in and around Blue Wealth.

Join us for lunch and a round of golf on our Annual Golf Day

We’ll be holding the Blue Wealth annual client golf day on Thursday 14 September at Bristol and Clifton Golf Club. A light buffet lunch will be served ahead of play in the afternoon.

Please email hello@bluewealth.co.uk to register your interest. It would be great to see you.

Adrian Thorley completed 2 cycle challenges

You’ll be pleased to hear that Adrian Thorley survived the two cycle challenges he’d set himself in June, raising more money for our charity partner BillyChip on the way.

First up was the Mendips Lakes and Lumps ride

Organised by a small group of locals with support and backing from the Mendip Hill AONB (area of natural beauty) unit, the ride offers people the chance to cycle the beautiful location and raise money for good causes.

Covering a total distance of 43 miles, the race started at 8.30 am on Saturday 11 June. Adrian picks up the story…

After a great night’s sleep, I was up early to walk Cooper and make myself a healthy breakfast.

Before every long event, I eat a bucket of porridge with fruit, nuts, and cinnamon. Although it seemed odd to be eating a bowl of hot porridge when the weather had been settled, warm and sunny, I needed to make sure I had plenty of fuel on board.

I have diabetes, so oats work particularly well because the energy release is slow (a bit like my cycling before anyone else says it).

Race conditions could have been better. Although it was still humid, it was fairly dull, and I quickly regretted my choice of dark lenses in my cycling glasses – in the shade it was like riding at night!

On top of the Mendips there was low cloud and drizzle which made the lanes very slippery in places. Because it was the first time it had rained in weeks, the damp roads were worse than they might otherwise have been.

The hardest part of the ride was the optional five-mile loop that I unwittingly signed up for. I was in the first group away and, when the organiser asked if anyone was planning on doing that, no one else put their hand up. One guy said he’d done it once and “never again”. That should have given me a clue.

The descent down a damp lane from Mendip Gliding Club – almost vertical in places – nearly saw me come to grief with an oncoming Land Rover and horsebox.

Unsurprisingly, what goes down must go up… The climb back to the top was horrible, but it didn’t beat me.

The highlight of the ride was when I overtook someone on the steepest hairpin of Cheddar Gorge to make a point after they had overtaken me on the descent from Shipham to Cheddar. Competitive? Me?

Key race stats:

• Time: 3 hours, 25 minutes, 31 secs
• Average speed: 14.2 mph
• Fastest speed: Topped out at 39.9 mph.

2 weeks later, it was time to tackle the Nello

The first Nello Century Cycle Challenge took place in 2000. The annual event has since raised more than £1.2 million for charity.

Having attracted 90 cyclists in the first year, these days the event has grown significantly and regularly has 1,000 people taking part.

Passing through some of the most glorious Devon countryside, this is a cycle ride that people take part in for the atmosphere, the camaraderie, and the buzz…

This race was in Devon, so my alarm went at 4 am on Sunday morning to allow time to walk Cooper before I set off. Despite the early wake-up call, I’d slept really well and raring to go. My companion on the ride later told me he had done anything but.

It was a long time since I’d ridden 100 miles. Fortunately, riding to and from the Mendips ride two weeks before made for a total 85 miles that day, so I was confident that, barring any accidents, I’d be okay.

Unlike the previous ride, the weather was excellent. It was bright, warm, and sunny, apart from on the top of Exmoor where clouds rolled in with a strong wind. The cloud and cooling wind was actually very welcome, as there is very little shade up on top.

The afternoon improved and the weather for the last 25 miles and at the finish was hot and sunny, which was great news for the organisers.

There was nothing too bad in this ride, the climbs from Dulverton towards the top or Exmoor then up again from Simonsbath were challenging but not horrible.

The highlight of the day was the camaraderie of the riders – it was a big event with more than 900 taking part, some opting to do the shorter 65 mile ride. I particularly enjoyed the banter with, and encouragement of, my companion, Simon – we agreed that riding alone is far harder.

Key race stats:

• Time: 6 hours 22 minutes 12 seconds
• Average speed: 15.5 mph
• Maximum speed: 40.5 mph – which seems an awful lot faster than it does in a car.

Also coming up this summer, I have the Great Weston Ride (75 miles) on Sunday 23 July. I would also like to do the Great Exmoor Ride (66 miles) on Sunday 10 September, but haven’t yet booked.

If you follow the Tour de France, you’ll know that the fight for the coveted yellow jersey is ruthless.

The Tour de France, or “Le Tour” as some call it, is the world’s largest annual sporting event. Held in France, the annual cycling competition consists of 21 stages, covering approximately 3,500 km.

Starting in Bilbao, the Grand Depart happened on 1 July 2023. The race will end three weeks later at the famous Champs-Élysées in Paris on Sunday 23 July 2023.

The 110th Tour included a gruelling 22 km time trial in the Alps, as well as several arduous climbing stages across all five mountain ranges in France.

The professional cyclists who tackle such a feat are undoubtedly at peak physical fitness, but winning the coveted yellow jersey takes far more than immense physical fitness – it also requires incredibly strong mental stamina.

While it may not be obvious, the mental aptitude required to excel in this kind of endurance race can provide excellent lessons around investing. Read on to discover three of them.

1. Prepare for success before the starting flag is waved

Endurance events like the Tour de France require participants to carry out extensive and consistent training.

It’s crucial for athletes to prepare their bodies and minds for the challenge ahead, and the same is true when it comes to investing.

Preparation is key to success. So, before you invest a penny, it’s important to understand your goals, your time frame, and the level of risk you are prepared to take.

Making any investment without appropriate training and preparation is foolhardy and unlikely to meet with success.

Fortunately, just as a professional trainer can help a cyclist prepare a winning training schedule, a financial planner can help you develop a sound investment strategy, tailored to help you achieve your financial goals.

2. Pace yourself

Although the 2023 Tour de France requires cyclists to race more than 3,000 km, the event takes place over 21 days.

To stay motivated and on track, the best competitors will have their own mental tricks to break the race down into small, achievable goals before allowing themselves to home in on the next one.

Novice cyclists are likely to fare better by starting with short cycle rides and extend the distance they cover in increments as their fitness and ability improve. When investing, you may find making regular, smaller investments over time beneficial, too.

Rather than investing a single lump sum, making regular small investments can mean you benefit from “pound cost averaging”.

With this approach, since you’ll be drip-feeding your money into the market, you’ll be making investments regardless of whether the markets are rising or falling. This can also be helpful in removing the emotional decision-making that often comes with investing.

Regular investing allows time to adopt a disciplined approach and may be well-suited if this is your first foray into investment.

Just as a cyclist might start with a local 20 km cycle ride, regular investing this way could provide a firm foundation to build on.

3. Stay focused on the finish line

In the same way that endurance events aren’t won in a single day, investing isn’t about achieving short-term goals.

Both require you to focus on the distant horizon, and you’re more likely to win by committing to making steady, consistent progress over time.

It’s important to stay focused on your goals and not get discouraged by short-term setbacks or fluctuations. Concentrating on your ultimate, long-term goals will help relieve any fears you might have.

The chart below helps to illustrate why this is important. The graph shows the performance of the FTSE 100 index, which tracks the performance of the top 100 companies on the London Stock Exchange, between the end of June 2002 to the end of May 2023.

Despite many downturns and two market crashes, during the course of 21 years, the index has significantly risen in value.

Source: London Stock Exchange

If you’d been put off your game by the slumps, you may have decided to sell your investments, missing the opportunity for significant gains further down the line.

So, whether you’re cycling or investing, remember to keep your eye on the prize and focus on the long game.

Get in touch

If you’re ready to take on the long game and invest in your future, we’re here to point you in the right direction and help you keep your focus.

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.

The value of your investment 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.

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.

For the last year, inflation has been high. If you’re worried about the effects of the rising cost of living, this guide could help you.

Figures from the Office for National Statistics show, in the 12 months to April 2023, the rate of inflation was 8.9%. This is far above the Bank of England’s target of 2%, and for much of the last year, the rate has been in double digits. 

The guide explains why needing to spend more to maintain your lifestyle could affect your long-term plans and how inflation could reduce the value of your assets in real terms.

You can also discover some of the steps you could take to “beat” inflation, including:

1. Making the most of suitable allowances
2. Shopping around for the best interest rate
3. Considering if investing is right for you
4. Reviewing your budget
5. Focusing on your long-term plan.

Download your copy of ‘How to manage the harmful effects of inflation on your wealth’ now to learn more about the effects of inflation and what steps you can take to “beat” it.

Inheritance Tax (IHT) has long divided opinion, but it’s not only controversial – many people also misunderstand how IHT works and how it’s possible to navigate the rules surrounding it.

With rising property prices and an extended freeze on IHT thresholds until 2028, more people are falling into the IHT trap.

Read on for some popular myths and learn the facts around how sensible estate planning could help you mitigate any IHT liability and leave more of your wealth to family and loved ones.

1. “It raises a lot of money for the government”

While it’s true that the UK government raised a record £7.1 billion in IHT during the 2022/23 financial year. This was more than predicted due to rising house prices, which increased estate values. In fact, HMRC’s figures showed that IHT takings had grown by £1 billion compared to the previous tax year.

By comparison, tobacco duty bought in £10 billion.

So, although there’s been an increase in IHT receipts in recent years, it doesn’t actually raise as much money as some may think.

2. “IHT only affects the super-wealthy”

While you may think that it’s only incredibly rich people who are likely to have to pay IHT, increasing property prices have meant that more people are finding themselves liable.

The good news is that a carefully considered estate plan can help protect your family and loved ones. Plus, it helps to ensure that your money and possessions are passed on according to your wishes.

Your estate is made up of your property, assets, bank account and investments. If you have a spouse, young children, or other dependants, it’s important that you write a will.

Allocating certain assets to your beneficiaries in your will can help you to ensure your estate plan is as tax-efficient as possible.

3. “My partner will inherit everything I leave free of IHT”

Don’t fall in to the trap of assuming that your spouse or civil partner will automatically inherit everything. If you haven’t written a will, your estate could become subject to the rules of intestacy.

Even if you don’t have children, if you haven’t written a will, there’s no guarantee that your spouse will inherit everything. This is just one reason why it’s so important to make sure you put your wishes in writing, in a legally binding will.

Read more: 6 important reasons to write and regularly revisit your will

Having a will is especially important if you’re co-habiting with your partner – particularly if you have children. If you’re not married, you don’t receive any special exemption on money you leave to your partner.

In the 2023/24 tax year, you and your spouse or civil partner each have an IHT allowance of £325,000. You both also have an additional £175,000 nil-rate band if you leave your home to a child or grandchild – this can also include great-grandchildren, adopted children, and foster children.

A surviving spouse or civil partner can claim any unused IHT allowances. As a result, a surviving spouse could have up to £1 million of IHT allowances, as shown below:

• 2 x £325,000 (standard IHT allowance) = £650,000
• 2 x £175,000 (property-related IHT allowance) = £350,000

So, if a surviving spouse left a £1 million estate, including a £350,000 family home, to their children, there would be no IHT charge.

4. “I can only gift £3,000 a year before it’ll be taxed”

It’s a mistake to think you can only gift up to £3,000 a year before attracting IHT.

However, there are no rules to how much you can gift in any given year, and you could choose to give away more. The catch to understand is that anything you gift above £3,000 becomes a “potentially exempt transfer” (PET).

If you survive for seven years after making the gift, no IHT will be due on its value. However, if you

die within four to seven years after making the gift, a reduced rate of IHT may be payable on the value.

This can be a complicated area to understand, so it’s a good idea to seek advice. If you’d like to give a financial gift to your family and loved ones, we can help you understand all the implications of your decision.

It may also be useful to remember that there’s an exemption on “small gifts”, allowing you to make unlimited gifts of up to £250 to different people.

Plus, for wedding gifts, you’re able to gift:

• £5,000 to a child
• £2,500 to a grandchild or great-grandchild
• £1,000 to anyone else.

5. “If I move abroad, I won’t have to pay IHT”

If you live in the UK and are domiciled here, your entire estate is potentially taxable on your death regardless of where your estate is situated.

Should you have plans to retire abroad and think this will mean you can avoid paying IHT, think again. For most people, if your estate exceeds the IHT threshold of £325,000, it will be assessable by the UK authorities in the same way as if you lived in the UK.

An estate plan can help make sure more of your money goes to those you love

Being able to pass on your wealth to your loved ones can be a challenging area to navigate. While you may think that estate planning is simply about IHT, that’s just one part of the puzzle.

We can help to protect your assets and help make sure that more of your money goes to the people you love and care for.

Get in touch

If you’d like to discuss ways you might be able to reduce a potential IHT bill and ensure those you love benefit from all your hard work, 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.

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.

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.

As a business owner, effectively managing your finances is important. It can help you get the most out of your assets, potentially reduce tax liability, and improve the success of your business.

There are many different areas you may need to consider, from what taxes your business could be liable for to planning for your retirement. This e-zine covers essential topics and offers practical tips that could improve your finances.

The e-zine is split into four sections that cover different areas:

1. Managing your finances and long-term security
2. Getting to grips with business finances
3. Finances and your employees
4. Planning your exit strategy

Download your copy of “The complete guide to managing finances as a business owner” now.

If you have any questions about the topics covered in the e-zine or would like to review your finances, please contact us.