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Your plans for 2018 and beyond - focus on the long game

A New Year brings a fresh mindset – an opportunity to take stock and re-focus for the year ahead, in both our personal and financial lives. Outlook

The year starts with the Winter Olympics in South Korea and in February we enter the Chinese New Year of the dog, symbolising loyalty and honesty.

With a royal wedding and Commonwealth Games in the springtime – anticipation hangs in the air, before the World Cup in Russia kicks off in June – exciting times ahead.

Take stock

It’s also a time for reflection.

Geopolitical and economic uncertainties have become consistent features that will not dissipate overnight, as Brexit negotiations continue. Despite uncertainty being the order of the day over the past year, all major stock markets have generated healthy positive returns.

The performance of the UK stock market has defied investors’ concerns. The UK remains home to some of the world’s most successful businesses that have demonstrated an ability to thrive regardless of the economic and political backdrop.

Looking globally, in the US economic fundamentals are supportive. Europe has performed strongly, encouraging elections (albeit inconclusive in Germany’s case) boosting investor sentiment, the outlook for the region remains bright.

Elsewhere, against an improving global economic backdrop, investor sentiment towards Asia and emerging markets has seen a resurgence, rapid growth and multiple market opportunities.

Be clear on what you want to achieve

What’s important is that as an investor, you regard the New Year as the perfect time to revisit your investment objectives.

By visualising your objectives as connected to your aspirations and hopes, you can engage with your future wealth; a great motivator.layers

Think about your attitude to risk and capacity for loss. Have they altered?

If so, this will need to be reflected in the allocation of your assets. Clear communication of these changes is key.

Think holistically - the bigger picture

Think about all of your investments collectively to ensure the full allocation of assets, including cash, does not duplicate and is a true reflection of your risk requirement; portfolio diversification is crucial.

Long-term investment should transcend short-term concerns – don’t let events cloud your judgement.

Investors would do well to understand the broad, historical context of the stock market and fund managers’ long-term histories.

Bottom line

Investing in a changing world presents different opportunities and exciting new themes. Get re-energised for the year ahead and take control of your investment strategy.

Displaying the same attributes as the loyal and honest dog – you can rely on us to guide you through your investment journey.

Ready to invest?  Here's how to get startedfinance strength

If you’re looking to get a better return from your money than you can from your bank account, then the time might be right to think about investing for the future.

Before you begin, here are some golden rules to consider.

Hold some cash

You’ll need to have ready access to a cash fund to cover everyday living expenses and unforeseen expenditure.

Obviously, there’s no point rushing into investment if you’ve got substantial debts or if you know you’re going to have to make major financial commitments that will take up all your spare cash.

A vital part of your financial planning must be providing adequately for retirement, not least because of the tax breaks available on pension contributions.

Define your goals

You need to be clear why you’re investing and what your goals are. The sort of life events that people often invest for include a child’s education, a daughter’s wedding, to repay a mortgage, retire at 55 – the list can be a long one. Knowing your time horizon helps ensure you put in place the right investment strategy for your needs.

Know your risk profile

You will need to establish how much risk you’re comfortable with, and the impact that has on the rate of return you can realistically expect to earn. You should bear in mind that the level of return can vary from year to year, and that past performance is not a guide or a guarantee of future returns. The value of shares can go up and down.

Go for diversityDiversification

A portfolio that includes a range of assets alongside shares, such as bonds, property, and cash, has been shown to perform better over the longer term than one that is only invested in one type of asset.

This process is known as asset allocation, and is almost always the starting point when deciding where to invest.

Getting investment advice makes sense

We will be able to help you in a variety of ways. Firstly, we can work with you to review and assess your current situation, any existing holdings you may have, your family circumstances and tax position.

Drawing on our expertise and extensive knowledge of the market, we will recommend the asset allocation that will meet your requirements, together with the investment options that are suitable for you.

While building a potentially profitable portfolio means taking a longer-term approach, we will want to schedule regular reviews with you so that your investments can, if necessary, be altered or rebalanced in response to economic and market forces.

It is important to take professional advice before making any decision relating to your personal finances. Information within this newsletter is based on our current understanding of taxation and can be subject to change in future. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK; please ask for details.

We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor.

MACO FinTax Acuity 2017 18

If you would like any advice or information on any of the areas highlighted above, please get in touch with Ian Finch, Chartered Financial Planner, or your usual Martin Aitken Financial Services contact to arrange an appointment.

For further financial, investment and tax developments download our latest edition of Financial & Tax Acuity Winter 2017-18.

For further tax planning ideas download our Tax Planning for Life Guide which covers all facets of life (and taxes due): work, life, family and succession.

Tax Rates 2017-18 - personal, business and other relevant tax rates for the current tax year >more

 

 

 

 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. If you withdraw from an investment in the early years, you may not get back the full amount you invested.

Changes in the rates of exchange may have an adverse effect on the value or price of an investment in sterling terms if it is denominated in a foreign currency. Taxation depends on individual circumstances as well as tax law and HMRC practice which can change.

The information contained within this newsletter is for information only purposes and does not constitute financial advice. The purpose of this newsletter is to provide technical and general guidance and should not be interpreted as a personal recommendation or advice.

Spring Statement 2018
Financial & Tax Acuity Winter 2017-18

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