Lothbury Wealth Management Limited

FOR INVESTORS IN THE WOODFORD EQUITY INCOME FUND

You may or may not be aware but there is a vote underway on the acceptance of a compensation scheme for Woodford investors.

The voting is online and the deadline is 4th December. The link is below:

https://lfwoodfordfundscheme.com/

The recommendation is to vote in favour of the scheme so that people who had money invested when the fund was suspended could receive a share of the £235m in redress. According to BBC news this would amount to 77p in every pound they had invested.

For investors in this category to receive this though they need 75% of shareholders by value and 50% of shareholders to vote in favour.

The article below gives a bit of information.

https://www.bbc.co.uk/news/business-65335843

Compensation plan for Neil Woodford investors revealed Savers in the collapsed Neil Woodford fund could receive 77% of their investment back.

Marriage Allowance

A brief reminder of one of the lesser used and often forgotten tax allowances. It is relevant if the below applies:

- Are you married or in a civil partnership?
- Does one of you earn less than £12,570 per annum?
- Is the other person a basic rate taxpayer?

The lower earner can then transfer up to 10% of their personal allowance (£1,260) to their spouse potentially saving up to £252 in tax.

The personal allowance is the amount of income you don’t have to pay tax on. In 2023/24 tax year it stands at £12,570 per annum.

You can also backdate your claim to include any tax year since 5th April 2019 that you were eligible for Marriage Allowance.

You can claim this allowance either through self-assessment form or by filling in the Marriage Allowance form (MATCF)

To find out more information, please see the government website.

October 2023

Do you base your job search solely on a higher salary?

It is obviously important to always try and progress but don’t forget the benefits. Benefits do cost and should be part of the salary negotiations at the start.

For example, the cost of standard benefits an employer may offer a 35-year-old non-smoker earning £80,000 per annum are:

- Income Protection cost would be £70.81 per month (£849.72 per annum)

- Death in service and Critical Illness for 4 x salary cost would be £137.13 per month (£1,645.56 per annum)

- Health Care cost would be £42.97 per month (£515.64 per annum)

- Employer Pension Contributions based on the minimum would be £110.08 per month (£1,320.90 per annum)

The total cost for all benefits (if you were to pay for them yourself) is therefore £360.99 per month (£4,331.82 per annum)

Benefits are also extremely important and help safeguard you financially. As often said, we don’t question getting pet insurance or contents insurance, but we don’t protect the person who pays for all these insurances. What happens if you weren’t there? Could your family or you financially cope and pay for the pet insurance... ?

Comparison Websites- do you really know what you are buying?

A common assumption is that cheaper is better. However, providers that appear at the top of often have a catch.

One such feature is an age- costed guaranteed premium. These often appear to be the cheapest premium, however the ‘guaranteed’ is slightly misleading as the premium actually increases in line with your age by a pre-agreed amount.

As an example, an age costed policy was £21.12 per month compared to a non- age costed policy offering £35.89 per month. This may seem like an obvious choice, however, by the age of 63 the premium has increased to an eye- watering £131.07 and yet the non- age costed premium has remained at £35.89 for the entire term.

Unfortunately, many people end up with cover that is unaffordable and inevitably cancel it. Having an adviser can guide you through these jargon busters could save you money in the long term.

Data from September 2023

Bank of England has announced they are raising the Base Rate by 0.75% to 3%.

In their statement the Bank of England said they expected rates to peak in 2023 at a lower level than market expectations of up to 5.25%, but they did not say what level they expect the peak to be.

The Bank of England also revised their forecast for peak inflation early next year down to 10.9% from around 13%, and potentially down to zero in 2025.

The Bank of England have had to take this decision ahead of the Government fiscal statement, which was originally scheduled for Monday this week, but is now not due until 17th November.

Searching for some good news, you may be able to earn more on your cash deposits!

As always please contact us if you want to discuss the impact on your financial situation

Lost Pensions

Failure to keep tabs on old workplace pensions has led to billions of pounds worth of savings being misplaced or forgotten about, according to The Association of British Insurers (ABI). The ABI estimates put the figure at around £19.4 billion, comprising 1.6 million pots with an average size of £13,000

Use the following link to help you find your pension.

https://www.gov.uk/find-pension-contact-details

Or use the below link to see if the original pension provider is now administered with another provider and get their contact details.

https://www.abi.org.uk/data-and-resources/tools-and-resources/find-lost-pension/

Find a lost pension | | ABI Keep track of your pension or find a lost one by contacting your provider

Good luck to Tony who is running the Royal Parks Half Marathon this Sunday in support of The Hospice in the Weald, who provided such great care and support to our co-founder of Lothbury and good friend, Bob Russell.

https://www.justgiving.com/fundraising/clementstonyparks

Tony's Royal Parks Half Marathon 2022 page Help Tony Clements raise money to support Hospice in the Weald

Old £20 notes

Old £20 notes will expire on 30th September 2022. If you miss that, pop into your bank or post office to bank it as a lot of banks will still accept them after this point - including my old £10 note from 2018!

We have recently watched a video on MoneyAlive which we found interesting.

You probably know that you need 35 years of NI contributions are needed to get the full state pension. But did you know that you may actually need more?

If you were contracted out of the Additional State Pension (‘SERPS’) pre 2016 to claim employer contributions instead this may apply to you. It is more likely if you have worked in the public sector.

If you would like to watch the full video, please contact us at [email protected] and we can forward the link.