If, for whatever reason, you are determined to sell your property, you can’t dwell on the state of the house sales market, even if it is sluggish or saturated with unsold houses. You can only do your best to sell yours, either at the price you require, or by going for the appeal of an irresistible, and costly for you, bargain!

So assuming you would prefer to get a reasonable price for your property, what can you do to make it into a property which will meet a potential buyers’ highest expectations and even achieve their dream of how the ideal place to buy should be? A pretty tall order, considering that buyers are not cloned to be of the same mind as you and are likely to have their own particular ideas about what they want!

One option would be to go on the internet and search for the ten top tips for improvements that should increase your property’s value – there are sites that will give you ideas but most of them acknowledge that there are no guarantees any of those ideas will work. We have put together a list based on the most frequent suggestions for house improvements. But first, three broad recommendations:

• Try to give buyers something of a ‘blank canvas’ – so they can see how they will get their ideal house with the minimum amount of effort – neutral ‘magnolia’ décor throughout and the absence of your ‘clutter’ taking up space might help!
• Your house, despite whatever you might spend on it, will not sell much above the neighbourhood price range and therefore spending and trying to recoup what you have spent may be a problem!
• It’s not what you have done with your property over and above being a careful and good maintenance owner that matters, it’s what the buyer wants – be in a listening rather than selling mode!

So here are ten of the most commonly recommended tips:

1. Convert a loft or roof-space to add living space
2. Add a suitable extension
3. Insulate to cut down heat loss through the roof and walls
4. Fit double glazing
5. Install central heating
6. Build a garage or improve your garaging
7. Ensure the kitchen is an attractive working space
8. Modernise the bathroom with shower and bath
9. Convert to provide extra facilities, a utility room, bathroom or en-suite etc
10. If the site and plot warrant it – obtain outline planning permission.

What you might choose to do of course depends upon what you are starting with – what is already there and what’s missing! A second consideration for you – are you happy to continue to live with what you are doing?

If you want to find out more, or need advice about selling your property or buying one, contact one of the team  and we will who will be happy to help guide you in the right direction.

The report describes millions of private sector workers as saving for their retirement, whilst being stuck with a hugely unfair, opaque and bewildering annuity system. Worse still, it highlighted evidence of sharp practice and murky pricing in the annuity market putting unsuspecting consumers at a huge disadvantage. The £1bn loss could treble in size to £3bn over the next decade as the annuity market matures and as up to 8m people start being automatically enrolled into workplace pensions from 2012. Around 20% of these losses are passed on to the public in the form of lost taxes and higher means-tested retirement benefits.

When they retire, people in the private sector saving in a ‘defined contribution’ pension (now the most common form of company pension scheme) use their pension pot to buy a product called an annuity from an insurer. This gives them a regular income and is a one-off, irreversible decision that sets the size of their pension for the rest of their life. The process for choosing an annuity is a complex one and the majority still go for the ‘default’ option by sticking with their pension scheme provider. This failure to shop around for a better deal can wipe 30% off their annual pension income, and in some cases up to 50%.

The NAPF/PI report found that it is too difficult for savers to get the best deal when:

• 80% of savers have pots of less than £50,000, and most annuity advisers will not find it profitable enough to advise on pots of this size;
• Fewer than one in five people have the financial know-how needed to pick the right annuity at the best price;
• Those savvy enough to ‘shop around’ for the best rate struggle to do so because the best shops are not signposted;
• People get too little support from employers or providers when making a decision about their annuity.

The report, partly based on extensive interviews with companies that cover 80% of the annuity market, also discovered that in practice, annuity prices can be heavily manipulated:

• There is a severe lack of transparency and understanding about how annuities are priced, especially for those with medical conditions who could qualify for a much higher level of pension income;
• Annuity advisers say some insurers push rates downwards at certain pot sizes when they see a group of people approaching retirement, as they expect many will not look for a better deal and will accept the insurer’s first quote;
• Annuity rate bands can have ‘cliff-edges’ which mean that rates outside of the commonly quoted £50,000 and £100,000 benchmarks suddenly drop off and become much worse, penalising customers who could get a better rate by having as little as £1 more in their pot;
• Most savers pay commission when they buy an annuity. It is factored into the annuity rates of most providers – whether the saver gets advice on annuity choice or not!

If you want to find out more or need advice about buying an annuity, contact one of the team who will be happy to help.

The Centre also forecasts sluggish growth in the medium term. Growth in 2013 is forecast to be minimal at 0.9% and from 2014 onwards at around 1% per annum. Inflation is forecast to fall to 1.7% by the end of 2012 and to remain at around 2% thereafter, despite rising commodity prices and a weak pound. Unemployment is forecast to rise sharply to about 3 million in 18 months time, as companies batten down the hatches for the long term and revise their medium expectations of labour requirements.

UK base rates may remain at 0.5% until 2016, while increased quantitative easing to a total of £400 billion is expected for 2012, with the possibility of more in future years. A weak outlook is anticipated for sterling, and for the euro and the dollar, with the main weakening likely to be against the Asian currencies and the commodity based currencies.

The report’s contributors suggest that the world is going through a fundamental change where previously poor economies are industrialising fast. This is good news for them but because of the limits imposed by shortages of energy, minerals and food, some of their growth is at the expense of the more advanced economies.

The Chancellor is seen as not being able to reduce the UK deficit as quickly as he had hoped, since tax revenues will be depressed by slow growth. This does not make a case for giving up on austerity. Indeed the CEBR conclusions are that the UK debt to GDP ratio will go above 90%, meaning that the Chancellor will, at the very least, have to keep his austerity programme going for much longer than he originally forecast. Alongside the growing number of forecasts that the Bank of England Monetary Policy Committee will not raise the UK base rate from 0.5% before 2016, this reinforces a growing anticipation that UK economic growth will be slow.

If you want to find out more, or need advice about developing your business or planning your economic future, contact one of the team who will be happy to help.

It’s quite clear from Her Majesty’s Revenue and Customs that investors can transfer their ISAs from one manager to another whenever they want. They may in effect transfer their current year ISA subscriptions (and any related income) and/or all or part of their previous years ISA subscriptions (and any related income). There are two constraints – firstly, if the ISA contains current year subscriptions only the entire account must be transferred, and secondly subscriptions to a stocks and shares ISA can only be transferred to another stocks and shares ISA. However, subscriptions to a cash ISA can be transferred to another cash ISA, or to a stocks and shares ISA.

HMRC also tell us that where current year subscriptions are being transferred from a cash ISA to a stocks and shares ISA, the current year subscriptions are treated for all ISA purposes as if they had been made to the stocks and shares ISA. This means that the investor is regarded as never having subscribed to the cash ISA. Within the overall subscription limit, therefore, the investor may subscribe to a cash ISA later in the current year (with the same or a different provider) without breaching the one-ISA-of-each-type-a-tax-year rule.

The transfer procedures are guided by best practice recommendations from HMRC. When an ISA is transferred, the old ISA provider must give the new ISA provider a notice in writing containing information and a declaration.

HMRC has produced a range of model forms, available on-line for use by investors and managers, to enable the transfer processes. In simple terms, you as an investor should choose an ISA product (if helpful your financial adviser or accountant can advise on product suitability), then speak with the new provider and fill out a transfer form, which should contain a note you send to your existing provider. The new provider will contact your existing ISA provider, sorting out the transfer and preserving your existing ISA tax-free status.

There are two additional points to bear in mind – firstly what you certainly must not do, is withdraw your money from an existing cash ISA, in order to re-invest it yourself in a new ISA, as this breaks the ISA transfer link and you lose the tax benefit for that amount – let the approved transfer process take its course, for which there is a guideline of 15 days maximum for transfer completion. The second point to be aware of is that some ISAs still carry a penalty charge by your current provider for transferring out. Check for this – it should have been made clear to you when you purchased the ISA.

As we approach the end of a financial year, now is a good time to check the interest rates on any existing cash ISAs you hold!

If you want to find out more, or need advice about managing your ISAs, contact one of the team who will be happy to help.

An ABI consumer survey recently suggested that the introduction of auto-enrolment from October 2012 could not come fast enough for many, as a way of bringing them out of the ‘savings stalemate’. Not missing out on employer pension contributions (47%) and on tax relief from contributions (14%) were the most popular reasons encouraging people to remain ‘opted-in’ to workplace schemes. This clearly shows that people see the value of their money being made to work harder by the extra top ups they will get from their employer and the Government.

The ABI reports that overall, more than half (53%) of people not already in a company pension scheme say they will remain ‘opted-in’ when their employers begin automatically enrolling them in eight months’ time, and this comes before any significant promotion of the new scheme. With a further 30% of people still undecided, the Association could see even more remaining ‘opted-in’ and saving for their future.

The research also reported that a similar scheme to auto-enrolment in New Zealand has seen the number of workers saving for their pension more than double, with more than half of the country’s working population now enrolled. We could see even higher figures as the UK auto-enrolment arrangements will cover all eligible workers, whereas in New Zealand the scheme has only applied to those changing jobs or just starting work.

Around half of workers are currently either not saving into a pension or not saving enough, in the current financial climate. Auto-enrolment will give many people an opportunity to save for their retirement, which cannot be put on the back-burner or ignored, with the added value to their pension savings pot of employer contributions and tax relief on their own contributions.

If you want to find out more or need advice about the pensions scheme automatic enrolment roll-out for your business, contact one of the team who will be happy to help.

Source: www.abi.gov.uk

The Monetary Policy Committee, MPC, is made up of nine members – the Governor, Sir Mervyn King; the two Deputy Governors; the Bank’s Chief Economist; the Executive Director for Markets and four external members appointed directly by the Chancellor. The appointment of external members is designed to ensure that the MPC benefits from thinking and expertise in addition to that gained inside the Bank of England.

The MPC meets every month to set the interest rate. Throughout the month, the MPC receives extensive briefing on the economy from Bank of England staff. This includes a half-day meeting – known as the pre-MPC meeting – which usually takes place on the Friday before the MPC’s interest rate setting meeting. The nine members of the Committee are made aware of all the latest data on the economy and hear explanations of recent trends and analysis of relevant issues. The Committee also hears about business conditions around the UK from the Bank’s Agents. The Agents’ talk directly to business, to gain insight into current and future economic developments and prospects.

Whilst the MPC members each have expertise in the field of economics and monetary policy, each does not represent an individual group or finance area – they are required to be independent. Each member of the Committee has a vote to set interest rates at the level they believe is consistent with meeting the inflation target. The MPC’s decision is made on the basis of one person, one vote. It is not based on a consensus of opinion. It reflects the votes of each individual member of the Committee.

A representative from the Treasury also sits with the Committee at its meetings. The Treasury representative can discuss policy issues but is not allowed to vote. The purpose is to ensure that the MPC is fully briefed on fiscal policy developments and other aspects of the Government’s economic policies, and that the Chancellor is kept fully informed about monetary policy.

The monthly MPC meeting itself is a two-day affair. On the first day, the meeting starts with an update on the most recent economic data. A series of issues is then identified for discussion. On the following day, a summary of the previous day’s discussion is provided and the MPC members individually explain their views on what policy should be. The Governor then puts to the meeting the policy which he believes will command a majority and members of the MPC vote. Any member in a minority is asked to say what level of interest rates he or she would have preferred, and this is recorded in the minutes of the meeting. The interest rate decision is announced at 12 noon on the second day.

The MPC goes to great lengths to explain its thinking and decisions. The minutes of the MPC meetings are published two weeks after the interest rate decision. The minutes give a full account of the policy discussion, including differences of view. They also record the votes of the individual members of the Committee. The Committee has to explain its actions regularly to parliamentary committees, particularly the Treasury Committee. MPC members also speak to audiences throughout the country, explaining the MPC’s policy decisions and thinking. This is a two-way dialogue. Regional visits also give members of the MPC a chance to gather first-hand intelligence about the economic situation from businesses and other organisations.

In addition to the monthly MPC minutes, the Bank publishes its Inflation Report every quarter. This report gives an analysis of the UK economy and the factors influencing policy decisions. The Inflation Report also includes the MPC’s latest forecasts for inflation and output growth. Because monetary policy operates with a time lag of about two years, it is necessary for the MPC to form judgements about the outlook for output and inflation. The MPC uses a model of the economy to help produce its projections. The model provides a framework to organise thinking on how the economy works and how different economic developments might affect future inflation. But this is not a mechanical exercise: given all the uncertainties and unknowns of the future, the MPC’s forecast has to involve the input of individual member judgements about the economy.

If you want to find out more or need advice about the implications of the MPC decisions for you or your business, contact one of the team who will be happy to help.

Source: www.bankofengland.co.uk

Proposals published in December 2011 require each FSA-authorised bank or building society based in the UK to state that: ‘Your deposits are protected up to £85,000 by the Financial Services Compensation Scheme, the UK deposit protection scheme.  Any deposits you hold above this amount are not covered.’

Banks with branches in the UK, but headquartered and authorised in the European Economic Area (EEA), will have to state that deposits held with them ‘are not protected by the UK Financial Services Compensation Scheme.’ They will also have to state which other national scheme is providing the protection so that customers again know which compensation scheme they are relying on, which country it is based in and how it would work – for example how long it would take them to get their money back.

The proposed changes are designed to reinforce existing deposit protection measures and to ensure that every customer can clearly see how much of their money is protected, how much is not and whether they are covered by the UK compensation scheme. Recent research conducted by the FSCS to measure consumer awareness of the scheme, found customer knowledge continues to be extremely poor, and has in fact dipped since the crisis.

These proposals are the latest step in improving the deposit protection arrangements for consumers. A year ago all national compensation schemes across the entire European Economic Area were harmonised to offer cover at €100,000, or the local currency equivalent, and ensure eligible consumers are paid within 20 working days. At the start of 2011, the UK introduced faster payout rules, with a target of a seven day payout for the majority of claimants and the remainder within 20 working days.

If you want to find out more or need advice, contact one of the team who will be happy to help.

The Financial Services Authority is implementing the Retail Distribution Review (RDR as it’s commonly known) in December 2012, after which time advisers will either give ‘independent’ or ‘restricted’ advice. Simply put, ‘independent’ advisers will be able to give advice on the full range of retail products and investments: advisers giving ‘restricted’ advice will – as the name suggests – only advises on a limited range of products.

Certain conditions (including higher qualifications) will need to be met for an adviser to continue to be classed as ‘independent’ and it is therefore entirely possible that your independent adviser will no longer be independent as we enter 2013. If it is important to you that you continue to receive independent – as opposed to ‘restricted’ – advice, here are the three key questions you should ask your current adviser now:

1. Do you plan to offer independent or restricted advice after December 31st 2012?
2. Do you already have the higher qualifications you’ll need to continue giving independent advice? If not, when do you expect to achieve them?
3. Could you explain to me how I’ll pay you from 2013 – and how will this be different from the way I pay you now?

The answers to these questions should enable you to assess the type – and scope – of advice which you’ll receive from your current adviser after December 2012. Although some of the details and requirements from the FSA are still a little vague all advisers will now have a clear idea of the route they’re going to take post-RDR, simply because they will need time to meet the conditions the FSA is laying down.

This in turn means that if you seek clarification from your adviser now you will have plenty of time to decide whether he/she is going to offer the scope of advice you will require in the future. If that is not the case and you feel that you will need a new adviser, you will at least have adequate opportunity before the December deadline – and you’ll know the right questions to ask.

What about Informed Financial Planning?

You may have read our recent article titled ‘All IFP advisers a year ahead of RDR qualifications target’ which summarised our position with regards to the RDR requirements.

If you have not had chance to read this article please click the link below.

All IFP advisers a year ahead of RDR qualifications target

The main reason most people want to move their mortgage is to enjoy lower monthly repayments, which is not surprising in the current economic climate. But as well as lower rates, there are other equally valid reasons why it might make sense to look at changing lenders.

Here are some reasons why you may want to consider a change:

More flexibility - Many people want to pay lump sums off their mortgage, or reduce it by means of regular monthly overpayments. If your current lender won’t allow you to do this – or wants to impose a penalty for making overpayments – then it might make good sense to look at what’s on offer elsewhere.

To borrow more - Sometimes you simply need to borrow more money.  For example, your family may be growing and rather than move you’d like to extend and improve your present home. If your current lender won’t increase your mortgage, then there might be no option other than to look for a new lender.

A particularly attractive rate - It’s important to remember that your mortgage is only part of your overall financial planning, and there are times when your circumstances mean that a particular type of mortgage is attractive. You might be starting a family and need to keep your payments as low as possible for a couple of years or on the other hand be near the end of your mortgage and would like the security of a fixed rate as the mortgage nears completion.

While there may be good reasons for moving your mortgage, switching does have disadvantages. There will certainly be costs involved if you change lenders. There is a good chance that you’ll be faced with a valuation fee and legal costs and in some circumstances you may also be charged a penalty (or ‘redemption’) fee by your existing lender if your current mortgage product has some time to run.

The costs of moving your mortgage can be significant – but the good news is that the arithmetic is relatively straightforward. If the saving you’ll make by moving outweighs the cost, then all well and good. Equally, you may feel that the benefits you’ll gain are still worthwhile, irrespective of the costs involved.

If ‘sort out mortgage’ is on your list of things to do this year, then it makes sense to speak to an experienced independent mortgage adviser. Whilst there are online tools available for mortgage comparison, they can be complicated to use and often misleading. In the current economic climate (with lenders being understandably cautious) there’s no substitute for experience and knowing both the market and the individual lenders. As well as finding you the best deal, a good mortgage adviser will explain all the different types of mortgage to you and help you find the one that is exactly right for you.

The mortgage marketplace still remains complex with so different decisions to be made.  As such we have teamed up with a specialist in this area who is able to provide high quality independent advice for all of our existing and future clients.  We hope that this will ensure that you have considered all of the options available and will also take some of the hassle out of reviewing your mortgage.

If you would like to review your mortgage or if you are looking at moving house please contact us so that we can put you in touch with our specialist.  We look forward to hearing from you.

Other countries greeted 2012 less sluggishly and China and India reported a strong start to the year, with an increase in domestic demand helping to compensate for reduced orders from Europe.

Virtually all world stock markets turned in a positive performance in the first month of the year. The only fallers were Malaysia, Slovenia, Portugal and Spain, with several markets seeing rises approaching (or even slightly exceeding) 10%. Among the more established markets Hong Kong led the way, rising by 10.61%.

UK

The news from the UK was almost unremittingly bad throughout January – and yet the FTSE 100 index managed a healthy rise of just under 4% to finish the month at 5,681.

Unemployment in the UK reached a 17-year high at 2.68 million, with youth unemployment continuing to be above one million. On January 24th the Guardian reported that the national debt had reached £1tn and in a more prosaic demonstration of the national malaise, Little Chef reported a round of job cutting, perhaps reflecting the fact that there are far fewer reps and delivery drivers on Britain’s roads.

Most worrying though was the reported slump in Tesco’s sales over the Christmas period. The company’s shares slumped 15% on the news as Tesco warned of ‘minimal growth’ – a sentiment echoed by other retail chains such as Argos, Mothercare and Halfords.

Then on the very last day of January came news that Britain’s manufacturers had enjoyed a “strong start” to the year, with output growing at the fastest rate for a year. The closely-watched Purchasing Managers Index survey for January was upbeat, and even had some economists suggesting that a ‘double-dip’ recession could be avoided. Another strong performance in February would be a very positive indicator for the UK.

Europe

As noted in the introduction, M. Sarkozy and Frau Merkel didn’t meet until well into the new year, but then it was business as usual with yet more talks aimed at solving the Greek debt crisis and the EU bailout fund being boosted further to $1tn. Several learned commentators are now actively discussing the means by which Greece could leave the euro but – for the moment – the talks go on.

More worrying in the short term was the fact that the ratings agencies continue to downgrade both European countries and European banks. France lost its AAA rating in the middle of the month, and by the end of the month Italy and Spain had also been downgraded. Among the smaller economies, Belgium, Slovenia and Cyprus were all told to sit on the naughty step.

Speaking at the Davos Economic Forum, legendary financier George Soros warned of a “lost decade” for Europe, similar to that which affected South America in the 1980s.

Like the UK, however, European stock markets shrugged off all the worries to post strong gains in January: Germany’s DAX index rising by 8.91% to finish the month at 6,617.

United States

It was easy to be confused in the US, in a month which saw headlines about SOPA and SOTU. The first was the Stop Online Privacy Act, eventually withdrawn in Congress after much protest from Google, Facebook and countless other online luminaries. SOTU was the annual State of the Union address, and it was widely seen as the start of Barack Obama’s campaign for re-election. It may be that in the run up to the election the President finds himself repeating Bill Clinton’s mantra – “It’s the economy, stupid” – as the economic indicators coming from the US seem to be giving increasingly good news.

Despite this, the Dow Jones index posted only a modest rise compared to some world markets – up 3.6% to 12,632. However, American investors do have several reasons to be cheerful, with the economy expanding by 2.8% in the fourth quarter of 2011. Figures for December showed that inflation and unemployment both fell in the month and the US Federal reserve stated that there would be “no interest rate rises before 2014.”

The Far East

All the major markets in the Far East – China, Japan and Hong Kong – saw gains in January, and as noted above, Hong Kong’s Hang Seng index rose by more than 10%.

Japan did post its first annual trade deficit for more than 30 years, but given the disruption caused by the tsunami of March 2011, that was hardly surprising.

China’s economy “only” expanded by 8.9% in the last quarter of 2011: export growth was lower as a result of the problems in Europe, but as noted elsewhere, there are signs that domestic and regional demand is beginning to compensate for this.

Emerging Economies

January was a tremendous month for those stock markets usually filed under ‘emerging markets’ with Brazil, Argentina and India all posting double-digit rises. The Russian stock market rose by just over 7% as the anti-Putin protests subsided (perhaps because of the Moscow temperature in January…), but there was a less impressive performance from 2011’s stellar performer, Venezuela, where the rise was only 4%.

Whilst the IMF cut its overall growth forecasts for 2012 – trimming its forecast of world economic growth from 4.1% to 3.3% – it inevitably sees the major contractions in Europe and the developed world. Emerging and developing economies in Asia, Latin America and Eastern Europe are still predicted to see growth of 5% or above.

And finally…

January was a quite outstanding month for the financial headline writers. Blacks Leisure found itself in trouble and was eventually bought by JD Sports for £20m. Last minute price reductions failed to save Blacks but did prompt the headline, “Now is the winter of our discount tents.” And Sir Fred Goodwin found himself back to plain old ‘Mister’ as his knighthood was removed for the RBS debacle. However, Mr Goodwin was to hang on to his massive and much-envied pension pot – prompting the English edition of the ‘Volga News’ to report, “Queen takes Knight but no cheque, mate.”