Wealth Design News

The UK’s economy is fragile, debt-ridden, built on low paid jobs and doomed by Brexit – raising interest rates was a big mistake
Tracker mortgage customers were texted minutes after the announcement by the Bank Of England while savers wait (hopefully) for savings rates to follow suit. Indeed most Banks have stated they require time to review the situation before passing on the increase to savers. But is the ratcheting of rates to normalise them over the next few years wise? The rationale is that rises are needed to dampen down inflation. The MPC is concerned that increased wages and businesses competing for labour will lead to prices rising in shops, thus triggering a jump in inflation. But this overlooks the fact that a) it is the gig economy that is, in no small part, fuelling record unemployment figures and b) there is little to indicate wages are on the rise. Other points of concern are Britain’s private debt level – at about 217% of GDP and rising – while public debt is now approaching 90% of GDP, not to mention startling low savings ratio at 4%. And then there’s Brexit!
The value of the average home increased by 0.6% in July to £217,010 according to the latest Nationwide house price index. So a modest rebound rather than anything to get wildly excited about. As a result, house prices are up by 2.5% on an annual basis, increasing from 2% last month. This means annual house price growth has sat within the 2-3% range for the past 12 months, suggesting there has been little change in the balance between supply and demand in the housing market. Looking ahead, subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low. On balance, experts expect house prices to rise by around 1% over the course of 2018.
In a recent case the High Court held, on the basis of witness evidence, that a married couple had made mutual wills, despite apparently express wording to the contrary in each will.
There are not many mutual wills and there is even less case law on the subject so when a case like this happens it is bound to be interesting.
Married couples often execute wills which are identical in their provisions, frequently giving the estate to the surviving spouse or if the spouse does not survive to the children. This is commonly referred as "mirror wills". However, not every mirror will is a "mutual will", indeed very few mirror wills are mutual wills. Read more
On the morning of Friday 28th September, we are hosting a Macmillan Cancer Support coffee morning at our Cannock office and we’ve love you to be part of it. The event is being held at Virage Point, Cannock and is taking place between 1030am and midday. If you can come along, please email Laura in advance (her email address is laura@wealthdesign.co.uk) so we can ensure we have an abundance of goodies available to consume. See more
The Business, Energy and Industrial Strategy Committee report on gender pay gap has found that the majority (78%) of organisations report pay gaps in favour of men, and is making several proposals to change the reporting requirements.
These include requiring all employers to publish, alongside their figures, a narrative to explain them and an action plan for closing the gap; reducing the threshold for reporting after next year to all those employers with 50 employees or more; and clarifying the sanctions the Equality and Human Rights Commission can impose on those who fail to comply.
The FCA is planning new rules for loan-based crowdfunding platforms due to increasingly complex business models. The regulator is inviting responses to a number of specific proposals to change the rules for loan-based firms. The new rules aim to ensure investors receive clear and accurate information about a potential investment and understand the risks involved and that they are 'adequately remunerated' for the risk they are taking. It also wants to extend existing marketing restrictions for investment-based crowdfunding platforms to loan-based platforms.
UK public finances continued to improve in June, with the deficit in the first quarter of the 2018-19 financial year lower than at any time since 2007. But the good news was tempered by weak tax receipts. Tax revenues were only 2.9% higher in the three months to June than a year earlier, no better than predicted by the government’s fiscal watchdog, the Office for Budget Responsibility. With tax receipts still sluggish and all of the improvement in the public finances on the public expenditure side of the accounts, there is little evidence in the official figures that the economy’s growth has accelerated. Economists nevertheless said that the deficit figures were likely to give chancellor Philip Hammond a windfall to ease austerity in the Autumn Budget.
A report the Government could ditch plans for a 'pensions dashboard' – allowing everyone to see their retirement savings at a glance – has sparked an angry outcry. Fears are rife the project, which was developed by the pensions industry but needs legislative backing to force all schemes to sign up, could be abandoned despite widespread consensus that people need a tool to view all their pots in one place. A Government feasibility study promised for this spring is already overdue, and now a report has emerged that Work and Pensions Secretary Esther McVey 'wants to kill off' the initiative.
Savers have been scammed out of over £51 million by investment fraudsters between April and June this year, new figures from the City of London Police reveal. The figures show a 70% spike in investment fraud reported to the authorities when comparing the numbers from the same months in 2017, when fraud accounted for £30m. In 2016 that number was even lower, at £24m. Pensions are the biggest target, with the pensions freedoms ironically helping scammers on account of increased access. The UK government had pledged to introduce a cold-call ban in June. The promise has however been delayed, with the Treasury stating that the long-awaited rules have been pushed back until autumn.
On 16 July 2018, the Financial Conduct Authority (the FCA) published its interim report on the investment platform market study. The FCA notes that the investment platforms market has almost doubled in size since 2013, accounting for 500bn assets under management and remains a growing sector. The FCA, therefore, considers it vital that competition between platforms is working well and that investors continue to get a good deal. The FCA expressed concern at the significant costs often associated with exiting a platform. The FCA's proposed measures aim to make it easier for end users to switch platforms. These would include, as a minimum: introducing a maximum timescale for each step in the switching process; clear communication to investors from the receiving provider of the switching process detailing the transfer process, timelines and providing a point of contact for questions or complaints.