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Assurance Vie, an Alternative Way to Save For Your Retirement

By Michael Doyle - Topics: Assurance Vie, France, Luxembourg, Retirement
This article is published on: 15th March 2021

15.03.21

Many people are looking for an alternative to setting up a regulated pension for their retirement savings. Whilst there is tax relief on pension contributions in the savings phase, they are happy to give this up for more flexible and tax-effective income during retirement. In France, the most popular vehicle used for long-term savings is a contrat d’assurance vie, in which investors have the opportunity to invest regular premium savings or a temporary amount.
What Is an Assurance Vie?

An assurance vie is an insurance-based investment that can be as straightforward or as nuanced as you like. The following are the benefits of assurance vie for French residents:

  • While the funds remain within the assurance vie, there is usually no tax on any income or gains (i.e., the tax is deferred). However, social contributions are now withheld on an annual basis (rather than when the funds are withdrawn) for sums invested in a fonds en euros portfolio, just as they are for French bank deposits
  • A portion of any withdrawal is regarded as a capital withdrawal and is tax-free
  • An assurance vie becomes more tax-effective over time, and after eight years, the income can be offset against a tax-free allowance of (currently) € 9,200 per year for a couple submitting a joint tax return or €4,600 for an individual
  • You have total control of your money and may obtain monthly income payments from the insurance provider. However, withdrawals in the policy’s early years you can incur penalties, depending on the contract you select
  • If your circumstances or attitude toward investment risk changes, you might be able to change the funds in which you invest
  • For inheritance purposes, assurance vie is extremely tax-efficient
Assurance-Vie-France-English

Assurance vie is the traditional form of saving for millions of French citizens. Several billions of euros are invested by French banks and insurance firms that sell their own branded products.

Additionally, a much smaller group of non-French companies have designed French-compliant policies for the expatriate market in France. These businesses are generally located in heavily regulated financial hubs like Dublin and Luxembourg.

However, before selecting such a firm, make sure that it is a product completely compatible with French law to get the same tax and inheritance benefits as the French equivalent product.

Below are some of the benefits of a foreign assurance vie policy over a French assurance vie policy:

  • Other currencies, such as sterling, US dollars, and Swiss Francs, may be used to save
  • There is a wider variety of investment options available, including access to top investment management firms and capital-guaranteed products and funds
  • The report is written in English, making it easier for you to comprehend the terms and conditions of the assurance vie program
  • The assurance vie policy is generally portable, which is beneficial when travelling within the EU (or many other countries in the world)

When it comes to EU countries, the taxes can be confusing. In these jurisdictions, the plan is often accepted for its beneficial tax performance.

How Does Assurance Vie Work?
Your one-time or regular investment or premiums are paid to an insurance firm, which then invests the funds with the investment managers of your choosing. These are typically unit-linked investments, such as equity or bond funds, but they may also be deposits or unique products sold by different financial institutions.

You may invest in a range of funds which the insurance provider can pool together to create a mutual bond, which is your assurance vie policy. The value of the units you keep in managed funds is likely to increase over time if you have selected your investment wisely.

As a consequence, the value of your assurance vie policy will grow accordingly. You must, however, be fully conscious of and comfortable with the level of risk you are taking. As with any unit-linked investment, your fund’s value will go up or down depending on what is happening in the investment markets. Short-term market instability, on the other hand, typically has a lower impact over time

Smoothing out the bumps of market volatility

How Do I Choose What to Invest Inside My Assurance Vie?
You may hold strong opinions on the subject or have no opinions at all. In any case, having an excellent financial planner on hand is helpful. His or her job is to help you comprehend the full definition of investment and decide your attitude toward investment risk.

Without acknowledging any risk, there is little reasonable chance of making a significant return on your savings. Even leaving your savings in a bank these days carries the risk of not receiving a ‘real’ rate of return, i.e., one that keeps up with inflation.

An adviser can show you various types of investment options, clarify how they operate, their track record, and the nature and level of risk that the investment entails. Although you make the ultimate decision, his or her support may be helpful.

Following the initial investment, there should be regular follow-up meetings to assess your investment’s success and make any appropriate adjustments. This may be because your circumstances have changed or because certain funds aren’t performing as well as anticipated, and you’d like to replace them with funds that are.

Can Capital Be Guaranteed Via a French Assurance Vie?
The willingness to invest in a fonds en euros is a common feature of the French assurance vie (though this is also available, in limited circumstances, from insurance companies outside France).

Since your money, as well as any interest and year-end bonus applied to it, is guaranteed, this unique type of fund is structured to shape a very conservative base for your overall investment.

The majority of foreign companies that supply these forms of funds also provide sterling and US dollar equivalents. Intending to increase returns, the funds invest mainly in government and corporate bonds, with some exposure to equities and assets (real estate). Your money will earn interest over the year.

The insurance firm is allowed by statute to refund the bulk of the funds to your account in the form of a year-end bonus. The remaining portion of the fund’s return is kept in the insurance company’s reserves to smooth out potential investment gains, such as in periods of weak market results. However, the rate of return on the fonds en euros is ordinarily low due to the quality of the guarantees. Still, it is generally better than the interest received on a bank deposit account with immediate access.

However, the French tax authorities consider this form of a fund to be so without risk that annual social charges are imposed on the gain, potentially lowering the return rate over time.

It is also possible to invest in structured bank deposit offerings through some foreign assurance vie policies. The investment return is related to the stock market, but the capital invested is guaranteed.

French Tax Changes 2019

How Is an Assurance Vie Taxed?
Only the benefits portion of every amount you withdraw is taxable, and after January 1, 2018, the tax treatment differs depending on whether premiums were charged before September 27, 2017, or after that date.

Premiums paid before September 27, 2017
You may either be taxed at the set prelevement rate or file an annual income tax return, depending on your tax situation. The following is how the prelevement scale works:

  • Withdrawals made within the first four years are taxed at a rate of 35 percent
  • Withdrawals made between years four and eight are taxed at a rate of 15 percent
  • After eight years, withdrawals are taxed at a rate of 7.5 percent

Furthermore, social charges are imposed on the benefits portion of the amount withdrawn, at a rate of 17.2 percent. People prefer the progressive rate tax if it is lower than their marginal rate of income tax.

In France, the highest income tax rate is officially 45 percent. As a result, even though 35 percent appears to be a high rate, it is still the best choice for higher-rate taxpayers. After four years, you’ll have to reconsider which form to use. If your marginal tax rate is at least 30 percent, a prevelement rate of 15 percent is a better choice.

If you are a non-taxpayer (as more people are now since the 5.5 percent tax bracket was eliminated), you can opt to report the withdrawal on your annual income tax return.

After eight years, there is an extra income tax incentive to encourage people to save more for the long term. A single taxpayer is entitled to a €4,600 income tax credit against the benefits portion of any withdrawals made during the tax year. This is raised to €9,200 for married couples who are subject to joint taxation. There will be no income tax to pay if the benefits portion of total withdrawals made during the year does not surpass the allowances.

This might not seem like much, but it’s a valuable allowance, as shown by this example of Peter and Pam’s assurance vie policy, which they began nine years ago with a €100,000 investment. They have not taken any withdrawals, and the account is now worth €160,000. They want to buy a new car and need €15,000 to help pay for it, so they withdraw this amount. They receive a tax certification from the insurance firm when they make this withdrawal, showing how much gain is included in the amount withdrawn. The guaranteed value has risen by 60%, but the taxable benefit factor is only 37.5 percent (or €5,625) in this case. Since they have a tax-free allowance of €9,200 and they are subject to joint taxes, there is no income tax to pay.

Premiums paid from September 27, 2017
The tax rate varies based on the contract’s duration, plus whether capital remaining in the contract as of December 31 of the year before the withdrawal was above a threshold sum for contracts longer than eight years. The threshold amount is €150,000 per person (across all assurance vie policies), measured by the amount of premiums invested minus any money already withdrawn, rather than the contract’s value. Couples taxed as a household cannot share each other’s threshold because the threshold is not cumulative between individuals. As a consequence, one spouse can meet the threshold while the other does not.

On January 1, 2018, France adopted a 30 percent flat tax,’ consisting of 12.8 percent income tax and 17.2 percent social charges. As a result, for contracts that are less than eight years old, a flat tax is levied on gains in withdrawals which are deducted automatically by the insurance provider. The flat tax replaces the pre-September 27, 2017 rate of 52.2 percent (35 percent tax plus 17.2 percent social charges) for contracts of up to four years and 32.2 percent (15 percent tax plus 17.2 percent social charges) for contracts of four to eight years.

After eight years, the tax rate is 7.5 percent. In addition, there is 17.2 percent social charges to pay. The tax free allowance of €4,600 for a single taxpayer or €9,200 for a couple is still in place after eight years. When filing their French tax return, taxpayers can also choose to pay tax at their marginal rate in the ordinary income tax brackets (rates varying from 0-45%) plus social charges. Any excess tax already charged would be refunded after processing the tax declaration made in the year after payment of the withdrawal since the insurance provider will have already deducted 12.8 percent or 7.5 percent.

However, taxpayers should be mindful that if ordinary band taxation is selected for assurance vie dividends, this will extend to all other sources of investment profits, such as interest and persons, as well as capital gains from the selling of shares.

livret A

Does Assurance Vie Have Other Advantages?
Without question, assurance vie is also a powerful tool for estate planning, both in reducing French inheritance taxes and giving you leverage over who inherits your properties after you die. This form of investment is considered outside of your estate for

When you set up this form of investment before you turn 70, each beneficiary is entitled to a tax-free deduction of €152,500 for money invested before you turn 70, with taxes limited to 20% for everything beyond that (although sums exceeding €700,000 per beneficiary are subject to a higher tax rate of 31.25 percent).

The inheritance benefits are limited for sums invested after the age of 70. There is a €30,500 tax-free exemption in this situation (plus the investment return on the total invested) for all of the people who profit from it. Any portion of the premium that reaches €30,500 is subject to regular French inheritance allowances, which differ based on the beneficiaries’ connections to the policyholder. Any gain in the scheme paid out as a death benefit is also subject to social taxes at the current rate of 17.2 percent.

Assurance vie can be a valuable tool for estate planning and providing a tax-efficient source of income for the policyholder over his or her lifetime.

Comment prendre sa retraite à 50 ans?

By Cedric Privat - Topics: Barcelona, Financial Planning, Pensions, Retire in Spain, Retirement, Spain
This article is published on: 30th September 2020

30.09.20

Qui n’a pas rêvé un jour de pouvoir arrêter de travailler avant l’âge légal de la retraite? 50, 40, 30 ans? Et si ce rêve était réalisable?

La question peut faire sourire, surtout si vous résidez comme moi en Espagne à Barcelone, avec un prix de l’immobilier exorbitant et des salaires souvent moins élevés qu’en France.
Pourtant, de plus en plus de personnes y arrivent, alors pourquoi pas vous?

Le Frugalisme :
Le mouvement FIRE (Financial Independance, Retire Early), né aux Etats-Unis dans les années 2000, défend le principe de vivre simplement et de faire fructifier son argent pour pouvoir vivre de ses rentes.
Il s’inscrit dans un mouvement économiste du Frugalisme “Qui se nourrit de peu, qui vit d’une manière simple.” (Larousse)
Pourquoi ne pas s’en inspirer?

Comment?
• Économiser : s’acquitter de toute dette (surtout celle de votre bien immobilier), réduire son train de vie, éliminer les frais superflus, supprimer certains loisirs, épargner davantage dès le 1er du mois.
• Définir un budget : il sera indispensable de bien calculer vos besoins mensuels afin de définir votre patrimoine retraite et ainsi fixer votre objectif.
• Investir : en plus de votre résidence principale vous devrez investir judicieusement l’argent épargné dans des placements financiers, des actions ou de l’immobilier.

Les frugalistes suivent une « règle d’or » dite des 4% : disposer d’un patrimoine au moins 25 fois supérieurs au montant de ses dépenses annuelles. Si elles s’élèvent à 2.000 euros par mois, il faudra par exemple un patrimoine de 600.000 euros, permettant de vivre des 4% de rendement généré.

State pension systems

Quand commencer?
Bien évidemment, le plus tôt possible. Une retraite anticipée deviendra vite un rêve oublié si on débute trop tard, mais tout dépendra également de votre implication à la cause.
Les nouvelles générations se soucient de plus en plus tôt de leur retraite et pour cause; les prévisions des pensions publiques de retraite sont à la baisse et l’âge légal de départ à la retraite ne fait qu’augmenter.
Le frugalisme demandera une forte réduction de vos dépenses, il est souvent accompagné par une conscience écologique afin de se tourner vers un mode de vie décent et responsable.
Nos sociétés capitalistes amènent de plus en plus les individus à se poser des questions sur le rapport qu’ils ont à l’argent et au travail.

Qui peut appliquer cette méthode ?
Bien évidemment, toute retraite anticipée sera plus facilement accessible aux classes moyennes et supérieures. Pour beaucoup, il est déjà suffisamment compliqué de mettre un peu d’argent de côté.
Une recherche Google rapide vous permettra de lire les expériences de nombreux “jeunes retraités” à travers le globe.
Les méthodes divergent, mais la discipline est de rigueur. Certains retournent vivre chez leurs parents quelques années et économisent 70 % de leur salaire, d’autres travaillent pendant 10 ou 15 ans à un rythme à la limite du soutenable, certains vont compter des années chaque centime possible et enfin les plus privilégiés qui reçoivent un salaire confortable vont tout simplement faire plus attention, s’organiser et investir malin.

Cette méthode vous intéresse mais vous vous posez des questions ?

N’hésitez pas à prendre conseil auprès de professionnels à votre écoute.

Le groupe Spectrum à Barcelone vous propose d’effectuer un audit sans frais ni engagement afin de mieux vous organiser dans la préparation de votre retraite, anticipée ou non.

Nous vous aiderons ensuite à comparer et choisir le placement financier le mieux adapté à votre situation et préférence.

What is the point of having money?

By Barry Davys - Topics: Investment Risk, Investments, Moving to Spain, Retire in Spain, Retirement, Spain
This article is published on: 14th June 2020

14.06.20

The point of having money is personal to you. Looking after your money should always start with your requirements. Your life has its own twists and turns. Your hopes and dreams are just that; YOUR hopes and dreams. How you feel about money is personal to you.

In this article I give you a framework for why you may want money. Once you have the framework, you can colour in the detail in a way that suits your requirements.

Knowing your answer to the question, ‘What’s the point of having money?’ is the starting point. Money, savings, investments, whichever you wish to call it, provides you with choice. The reason for having money is that it gives you one of three things; security, freedom or opportunity. Which choice you choose is up to you. The answer may be correct for you but different for your neighbour, even if you live next door in the same size house.

Security
Security means that you have enough money to be able to settle your debts, pay nursing fees if required, pay for medical treatment and perhaps be able to help the children to buy a house. People who want security often have a home free of mortgage; their little piece of heaven that they own.

debt free home

To settle on having security means you need capital. Often people choose not to take risk with their money because they want to be certain it is there if they need it. A fall in the stockmarket will not damage the security blanket of money in the bank. Your savings are just one big emergency fund. In these times of extremely low interest rates there are only a few places to get a little investment return for this option.

More and more, I see that this form of planning is undermined by long life expectancy and inflation. Hoarding the capital without making it work can lead to the erosion of the buying power of these savings. Sadly, insecurity comes after years in retirement when people realise that what they thought was enough money, is not.

freedom and lifestyle

Freedom
Freedom is gained when your savings are invested to provide you with sufficient income to live on, whether or not you continue to work.

To achieve this position depends on what lifestyle you have. The more flamboyant the lifestyle, the harder your money will need to work.

To achieve a feeling of freedom, money is required, and it needs to work hard. You yourself should feel in a “life is good” state of mind. Your money must be making money and it must later be able to provide you with income if you want or need it. Making money means that you need to invest in shares, bonds and perhaps some property (in addition to the home where you live). If you do not have the inclination or skill to do this yourself, you should work with a professional adviser or use funds. Some investments can provide you income now and others with capital growth. The growth parts will protect against inflation and can mean you can increase your income later.

Opportunity
Do you want your life to be full of opportunities? To be a space tourist? To ride a Harley Davidson to Lapland from Denmark like Steve Forbes (Forbes magazine) did, just to see the Northern Lights? Or both? What an opportunity that would be seeing the Northern Lights from earth AND then see them from space. Or to be one of the first investors in the company that makes the software for all the driverless cars in the world? As your world is a world of opportunity there are many, many more things that you can do with your life; most people will never ever get the opportunities you do.

invest in technology

To build this life takes more money. You may have sold a business, for example. Or received an inheritance. And this money will have to work hard for you. You may have some core holdings to give you a diversified portfolio, but you will also have to take some risks to make your money work hard enough to provide you with a life full of opportunities. Take more risk with your investments, but be able to withstand an investment that doesn’t perform well. In addition to the investments used by someone looking for freedom, you may also invest in a new business, for example. This takes skill to analyse the potential of investments and you will benefit by taking advice from qualified and experienced people.

Whether you need help with deciding on your choice or you wish to discuss how to execute your plan, please contact me for assistance. An understanding of your concerns when discussing your aims and choices together with the expertise to execute the plan for your benefit can make for a strong and trusting professional relationship.

7 Good Reasons to Retire in Andalucía

By Charles Hutchinson - Topics: Moving to Spain, Retirement, Spain
This article is published on: 13th June 2020

13.06.20

There is currently a noticeable increase in the number of enquiries to estate agents in this area from abroad, the majority of which are from the UK.

If you are looking ahead to retirement and wondering where you might like to live when the time comes, you should consider putting Andalucía somewhere at the top of your list.

Lifestyle
The Spanish lifestyle is one of the most open and friendly in the world where coastal areas, in particular Andalucía, are most welcoming. Locals are well aware that the international market is all important to the economy and growth of the region, bringing prosperity to what was once the poorest part of the country.

Culture
The region is littered with places of historical interest and beautiful world heritage sites. The Arts play an important role in life here with great classical concerts and popular music shows. Every town and village in Andalucía has at least two ferias (festivals) a year and talented street performers are found everywhere. Every city has important galleries and museums reflecting its historical artistic contributions to the world.

Climate
Andalucía enjoys one of the mildest climates in Europe, especially in coastal regions where temperatures are not as extreme as in the interior. Having said that, the climate in the interior is dry, making the upper and lower temperatures more tolerable. The climate, outdoor life, healthy Mediterranean diet and generally relaxed atmosphere of the region can be counted among the many reasons why Andalucía enjoys the highest life expectancy in Europe.

Cost of Living
The benign climate makes for reduced heating, food and clothing expenses. It encourages outdoor living through more months of the year than you might enjoy in northern Europe or parts of the US. Spain is one of the largest producers of fruit and vegetables in Europe with much of these coming from Huelva and Almería and not far away, Murcia which is known as the vegetable garden of Spain. Eating out can also be very inexpensive and extremely good. In coastal areas and a little further inland there is no shortage of good places to eat. Spain is also one of the most important wine producers of the world and Spanish wines have come a long way, standing alongside some of the best in the world.

Sports & Outdoor leisure
There is a large variety of sporting activities to be enjoyed here. Apart from a huge number of golf courses and tennis clubs, there are excellent beaches, water sports, Whale/Dolphin watching, etc. You can snow ski and water ski within two hours of each other. We have the highest ski resort in Spain. Trekking and rambling is a pure joy through spectacular scenery.

Health Care
The state health care system in Spain is excellent and some of the best doctors and specialists can be found in this country, especially in Andalucia for they too want to live a good lifestyle! Health Insurance, if you do not qualify for state health care, is cheap when compared to northern Europe and many countries farther afield.

Communications
The larger cities in the region are very well connected with Madrid and other main Spanish cities. There are excellent coach and train services which are a joy to experience. Coach travel is inexpensive and always provides the bonus of being able to enjoy the view. Train travel also offers you the chance to enjoy the scenery and if you want added comfort and speed, the AVE is an excellent example of high-speed train travel with one of the best networks in Europe, which has halved train travel time around many parts of the country. It also compares favourably against air travel if, for example, you are travelling to Madrid, as you will be taken right to the city centre and you do not have to be at the station two hours before departure.

Capital cities in Andalucía also provide excellent connections by air with direct flights to 129 European cities as well as to numerous destinations elsewhere in the world. If you have family and friends back home, in the US or somewhere in northern Europe there are plenty of options when it comes to getting back to see them or having them come over to Spain for visits.

moving-to-spain

Things to consider before moving here

  • You will need to decide where you want to live. This is best achieved by renting short term somewhere first. Consideration should be given to any medical care needs, sporting facilities, schools (if you a younger retiree) and convenient distances to an international airport
  • You will need to decide how much time you want to spend here and whether to become tax resident. This is where I can give you in depth assistance with residency, permits and tax advice
  • Regarding tax, we would need to review any existing investments you may have to ensure they are tax efficient here in Spain. UK tax efficient investments are usually not tax efficient here
  • We would need to review your income situation in retirement and how best to achieve the required level with the least tax
  • We can assist you with a choice of medical insurance, if needed. Wills might have to be adjusted and Spanish ones drawn up

Please remember that if you already have a UK Financial Adviser, they will not be qualified or knowledgeable to give advice here.
By the same token, if one of our clients moves back to the UK or another country, it is essential they contact a local adviser there.

WISH YOU WERE HERE?
CONTACT ME NOW FOR FURTHER INFORMATION

Retire in Andalucía

State Pension Benefits

By John Lansley - Topics: EU Pension Transfer, France, Pensions, Retirement, State Pensions After BREXIT, UK Pensions
This article is published on: 22nd May 2020

22.05.20

If you have moved from one country to another, while it may be comparatively easy to obtain tax advice in order to help you plan your finances, it can be very difficult to find out how your State Retirement Pension will be affected, and this has become more uncertain as a result of Brexit. This article aims to shed some light on the issue

This article aims to shed some light on the issue.

I retired in the UK and moved abroad
Let’s start with something easy – if you have already retired and moved to Spain, France or another EU country, the chances are your only State Pension will be from the UK. With Brexit in mind, as long as you were legally resident in your new home country by the end of 2020, nothing will change, and you will be entitled to the annual pension uplift indefinitely.

Coupled to this is your entitlement to healthcare, in that you will have a form S1 from the UK, which ensures you benefit from full care on an ongoing basis, and which in effect will be paid for by the UK Government.

If you have already left the UK but have not yet reached formal retirement age, as long as you were ‘legal’ in your adopted home before the end of 2020, you will receive the UK State Pension at retirement age and qualify for annual increases. You will also be entitled to a form S1.

Note that, if you have not regularised your situation in your adopted home by the end of 2020, the situation is uncertain, to say the least. You will be entitled to claim the UK State Pension when you reach retirement age, but the uplifts are only due for 3 years and, most importantly, form S1 will not be available.

I left the UK 5 years ago at the age of 55 and have been self-employed in Spain for the last 5 years
Have you been making voluntary contributions to the UK scheme? Are you making contributions in Spain? If you haven’t already done so, obtain a pension forecast from HMRC – use the gov.uk website, sign up for the Government Gateway access service, and check your National Insurance Contribution records, as well as your UK tax records. You’ll have to apply to contribute, using form CF83 attached to the booklet NI38, Social Security Abroad.

You will then be told what pension you can expect at your retirement age, and you can also see how many incomplete contribution years you have. It is generally good advice to continue to make voluntary contributions after leaving the UK (currently £795.60pa), but if you are currently self-employed, you will only have to pay at the Class 2 rate, which is £158.60pa for the current year.

You’ll receive details of how to make up the shortfall, by bank transfer or cheque for past years, and by direct debit for the future if you wish to see payments taken automatically. Importantly, you can also call to obtain advice concerning whether it would be worthwhile doing this, and how additional payments will increase your pension entitlement – it might take a while to get through, especially due to the current Coronavirus lockdown, as it appears they are only dealing with those on the point of retiring, but you should find the staff helpful when you do.

Also, make sure you understand what your Spanish contributions entitle you to and try to obtain a projection of your future pension in Spain. This might prove difficult at present, with offices closed or providing limited services.

defined-benefit-pensions

Having worked in the UK, Italy and now in Spain, I want to claim my State Pension
The first thing to understand is that you should retire formally in the country you are currently living in, unless you haven’t made any pension

contributions there – in which case you apply to the last country in which you contributed.

So, in this case, you approach the Spanish authorities and will have to provide details of all your employment and self-employment history. Spain will then check with each country concerned (the EU-wide scheme ensures this is possible – work history outside the EU means you may have to apply individually to those countries) and will calculate your entitlement. (But bear in mind that Brexit may have had an impact on this in practice, even though the scheme should not be affected – very much ‘work in progress’).

They will do this by adding together the contribution years of each country and then applying this to their own pension rules. This means that, even if you don’t have the minimum number of years’ contributions in one country, the chances are that the contribution years in other countries will ensure you get a pro rata pension. Don’t forget, official retirement age can vary in different countries, and some state pensions are more generous than others.

Each country will then pay their share directly to you, and if you have continued paying into the UK system it’s likely you’ll end up with a much higher pension than might otherwise have been the case.

How is healthcare affected? Any other issues?
The good news is that receiving your pension locally will mean that your access to the local healthcare system comes with it – no need for a form S1. So, any attempts by the UK to remove themselves from the S1 scheme will not affect you.

Note that, although the UK state pension is paid regardless of your other income, the state pension in Spain is not, in that if you wish to continue to work, Spain will not pay anything to you.

10 TIPS FOR MANAGING YOUR FINANCES

Other financial planning tips?
Despite the UK government’s attempts to water down the ability to ‘export’ your UK private pensions using the QROPS arrangements, this is still

possible – but perhaps won’t be for much longer. So, obtain advice about whether such a move would be beneficial, as soon as possible.

Any savings or capital you have should be invested tax-efficiently and with the aim of protecting it against both inflation and exchange rate fluctuations. Stock markets can fluctuate too, sometimes dramatically as we have seen, so be careful you understand the amount of risk your investments are exposed to, and seek help from a suitably qualified professional who will be able to help you over the long term.

How much do I need for a comfortable retirement?

By Chris Webb - Topics: Madrid, QROPS, Retirement, Spain, UK Pensions
This article is published on: 18th March 2020

18.03.20

How much money will I need in retirement?

This is one of the most common questions I hear as a Financial Adviser in Madrid, Spain.

The answer to that question differs from person to person and the numbers I discuss with my clients vary massively. To some, having a quiet retirement with little requirements is the goal; others will want to continue playing golf and attend social events weekly. There is a huge difference in what you will need in your pocket with these different scenarios.

So, what do the experts think?
Researchers have calculated how much money a person needs per year in order to enjoy a comfortable retirement. The numbers were calculated by Loughborough’s Centre for Research in Social Policy (CRSP), The Pensions & Lifetime Savings Association (PLSA) and Retirement Living Standards (RLS). A report from Loughborough University and the Pensions and Lifetime Savings Association aims to help people understand how much they will need for a minimum, moderate or comfortable quality of life once they retire.

In the UK a full state pension comes in at just over £8,500, but it’s the other savings you accrue over your working life that will make the difference in people’s post-work years.

Experts found that a single person will need about £10,200 a year to achieve the minimum living standard, £20,200 a year for moderate living standards and £33,000 a year for comfortable living standards. For couples, the minimum standard came in at £15,700, moderate was £29,100 and comfortable worked out as £47,500. The results are based on consultations with members of the public and consider what is needed in retirement for home DIY and maintenance, household and personal goods, holidays, food, transport, clothing and social engagements.

The new Retirement Living Standards describe three different standards of living with associated costs for each – all established by what the public considers realistic and relevant expectations. Associated costs are made up of household bills, food and drink, transport, holidays and leisure, clothing and personal and helping others. The standards cover a range of goods and services that are relevant to most people. These and other costs, such as tax on pension income, may need to be added depending on individual circumstances.

A series of profiles and infographics have been created on the PLSA website to help people calculate their own finances. The research for the Retirement Living Standards was adapted from the approach used to produce the Minimum Income Standard – a calculation of what the public thinks is an acceptable minimum standard of living. The data was gathered through 26 group discussions with around 250 members of the public already retired or approaching retirement, from a wide range of backgrounds. Expert views were taken into account for some areas, such as transport, energy usage and food costs.

The discussions set the parameters for how higher living standards should be described and defined. Through these discussions, three retirement living standards were agreed: minimum, moderate and comfortable.

The standards:
At a cost of £10,200 per year for a single person and £15,700 for a couple, the minimum lifestyle covers all your needs plus enough for some fun – including social participation and social occasions.

The moderate lifestyle (£20,200 a year for singles and £29,100 for couples) provides, in addition to the minimum lifestyle, more financial security and more flexibility.

At the comfortable level (£33,000 a year for singles and £47,500 for couples), retirees could enjoy some luxuries like regular beauty treatments, theatre trips and three weeks in Europe a year.

Breaking down the RLS:

House: Household utility bills, decorating and maintenance, furniture, cleaning supplies, lightbulbs, cooking utensils, appliances (e.g. fridge, washing machine), garden supplies, towels, bedding, gardener/cleaner/window cleaner & funeral plan.

Food and Drink: Household food shopping, eating out, beer & wine.

Transport: Car running costs, railcard/train travel & taxis.

Holidays and Leisure: TV, DVD player, laptop, printer, speakers, CDs, stationery supplies, TV license and subscriptions, internet, activities & holidays.

Clothing and Personal: Clothing, footwear, cosmetics, toothbrush, toothpaste, shaving supplies, hair styling, beauty treatments, dentist, opticians, podiatry & minor first aid supplies.

Helping Others: Gifts, helping others (if applicable) & charitable donations

Planning early is key to getting your retirement plans in order. You can look up another of my articles here on this subject titled “It Is Never Too Early

Don’t delay your financial plans. For planning, yesterday is better than today, which is better than tomorrow. Contact me, Chris webb on 639 118 185 or chris.webb@spectrum-ifa.com if you want to discuss your own circumstances.

Sources:
Loughborough’s Centre for Research in Social Policy (CRSP).
Pensions and Lifetime Savings Association (PLSA)
Retirement Living Standards (RLS)

How to retire like a pro!

By Chris Burke - Topics: Pensions, QROPS, Retirement, Spain
This article is published on: 24th May 2019

24.05.19

Over the years I’ve helped many clients prepare for retirement. To come up with the best solutions, there are several matters and concerns to consider that don’t automatically come to mind. Some people think they have carefully planned out their glory days, only to find out there were a few things they didn’t consider; not only on the financial side, but also on the every-day-life side of things. So, here are some of my top tips on retiring like a pro, enjoying life to the fullest and sleeping well at night.

Before going into all the financial ins and outs, stop to consider this: Where do you stand financially right now? And, what life goals or dreams do you have for the coming years? Remember, we want these years to be golden, not feel like walking on hot coals. So, starting with where you are and what you really want helps provide realistic focus.

When it comes to planning ahead for your post-work life, there are (for a great number of people) three main sources of cashflow which, when orchestrated carefully, can together ensure a comfortable retirement: company pension (or employer savings plan), social security and personal savings. For others – particularly the self-employed – retirement will entail savings, investments, assets and most likely continuing with your projects whilst learning to detach a bit. No matter which camp you lie in, knowing what you will receive from each source and then working out your monthly living budget will be is a great place to start for setting out what lifestyle you can plan.

After taking into account what monthly living allowance you will have, probably the most crucial thing on the “how to retire for dummies” list is devising and then maintaining a lifestyle you can afford. Practicing frugality whilst enjoying life is indeed a quality many fail at. It’s about knowing what you have to live on and living within those means. Being prudent with your finances does not mean being tight or ungenerous. As Coco Chanel said, “Some people think luxury is the opposite of poverty. It is not. It is the opposite of vulgarity.” And none of us want to be vulgar. We want to be financially prepared and savvy.

Outside of whatever your retirement plan is, it is also important to ensure you have set aside, in a separate account, an ample emergency backup supply. “Emergency” meaning for any one of a hundred things that might unexpectantly pop up and require a quick financial outlay. It will help you sleep better at night.

How to retire like a pro

Retirement isn’t always all sunshine and happy days. Many retirees struggle immensely with the sudden and somewhat shocking change of lifestyle. They go from being busy and surrounded by colleagues and friends, to being at home looking for a new purpose whilst trying not to step on the toes of their partner. For some, the extreme change of lifestyle and the thought of being on a continuous holiday can be scary and depressing. However, it should be thought of as a new opportunity to work on relationships, invest in travelling, both inward and outwards, and to learn new skills.

Nowadays, many post-retirees are creating projects to generate new income as well as keeping their minds sane and boosting their overall quality of life and health. This can also help to improve your self-worth and the relationships you hold dear. It doesn’t mean you have to work from 8 to 8. It can just be involvement in projects that help to provide a balanced life.

When it comes to retiring, there’s a dirty word we all must know and understand: inflation. As Sam Ewing said, “Inflation is when you pay fifteen dollars for a ten-dollar haircut you used to get for five dollars when you had hair.” When we are working, salaries are supposed to keep up with inflation. However, when the salary stops and you’re living off savings, inflation is like an armed robber. There are now online inflation planners which can quickly calculate both pessimistic and optimistic inflation rates and help you formulate what to expect living, household and medical costs to be in future years.

Lastly, I would suggest having a pool of money that you leave untouched and allowed to grow, until you need it later in retirement to help offset increasing expenses. If you have income from property, this is great because it more or less keeps up with inflation rates. Otherwise, consider some inflation-protected security investments – a balanced mix of stocks, bonds, short-term investments, at different levels of risk and potential growth. Considering all options and forming a good plan is something I can help each client with.

Retirement doesn’t have to be scary. If you’d like to discuss any aspects of financial planning for your retirement, please email me for a complementary face to face meeting.

We are all living longer, and it’s not all good news

By Jeremy Ferguson - Topics: Financial Review, Inheritance Tax, Marbella, QROPS, Retirement, Saving, Spain
This article is published on: 5th February 2019

05.02.19

When it comes to the way in which we are leading our lives, the world in which we live has changed significantly over not that many years.

Do you remember starting the day off with a bowl of cornflakes smothered in processed sugar and full fat milk, followed by a couple of slices of white processed bread smothered in butter and marmalade (laden with sugar), then washing that down with a couple of cups of strong coffee before we rushed off to work? Then at work the stresses of the day were broken by coffee to keep you going, with a packet of sandwiches and a bag of crisps at lunch time. A sneaky stop off on the way home for a couple of pints for some, then dinner followed by bed. Sound familiar?

Through a combination of increased awareness of the dangers of processed food and sugars, non-stop articles and TV programmes warning us of health issues; people are becoming increasingly health conscious. Add to that the mass of personal trainers and nutritionists out there, and people nowadays are more active and much more aware when it comes to healthy eating and lifestyle.

If you are reading this, you probably made the decision to move to the south of Spain some years ago, and boy, how things have changed as a result. Longer days, constant sunshine, lovely salads, a relaxed life, and probably a lot more time spent outside walking, or for many, playing golf or tennis. Oh yes, and the big one, much less stress!

spectrum ifa retirement

This is all resulting in something that is causing massive issues around the Globe for all sorts of reasons. People are living longer and needing more medical help along the way, because, despite being generally healthier now, older people still have more health issues than younger people. With that comes an ever increasing stress on healthcare systems. The ageing population also means that the ratio between retirees and workers is swinging in a way that means less taxable income is there to help fund the ever increasing medical needs.

So, while it is great we are all living longer, and therefore having a longer and healthier retirement, how much attention are we paying to this fact with regards to financial health? The pension pot and savings pot we hope you have accumulated now has to last for an ever increasing length of time. Have you considered the need for adequate medical insurance before it is too late to be accepted as a client (because you are too old)? Inheritances may be left to you at a much later stage of your life, and when they are, they could also be smaller due to the fact your parents lived so much longer.

In summary, it is really very important to spend time considering all of these factors. How many of us actually look at this in detail, with an honest reality check regarding the years ahead?

One of the things I like to do with my clients is to make sure we look at the big picture, assessing what you have and how long it is likely to last. Should you be putting the brakes on the lifestyle just a bit for that added longevity financially, or are you being too cautious? It is amazing the amount of couples I meet who are being too careful with money. Or have you got it just about right?

What happens if inflation rises or falls, or the money you have invested loses value or, hopefully, makes more than you expected? Oh yes, and what happens to your income when exchange rates move?

It is always said that you cannot buy time, but strangely enough, most clients I meet here in Spain look a lot younger than they actually are, so in my view, they all seem to have managed to do just that, aided probably by all of the things we know are good about living here. So, if by talking we can remove a little more stress by getting all of those financial ducks in a row, then maybe you can cheat the grim reaper for a good many more years to come.

All this talk of a flat tax

By Gareth Horsfall - Topics: Income Tax, Italy, Retirement, Tax, tax advice, Tax Relief
This article is published on: 8th June 2018

08.06.18

The current political environment in Italy is one which I find very interesting, notably in how it is perceived in foreign media and presented to us through the usual media outlets. In particular, I reference the constant use of the word ‘Populism’ and ‘Populist Government’. I confess that I had to have a quick look at the definition of populism before writing this Ezine and was interested in finding out that the exact defintion, according to Wikipedia, is:

‘Populism is a political philosophy supporting the rights and power of the people in their struggle against a privileged elite’

I have a confession to make that if I can pick and choose only this broad defintion of Populism then I think I can fit myself into a part of the populist ideal. (Clearly it is more complicated than this but I am merely trying to make my point, and as a regular reader of my E-zine’s you will understand my usual approach!)

However, I think it is worth exploring the idea that the Lega and M5S coalition have put together of a flat tax. Although a flat tax for eveyone, no matter how rich or poor is completely obscene in my opinion the ‘flat tax’, proposals, which will launch at 20% for businesses as of July 1st 2018 and 15% – 20% on 1st Jan 2019 for individuals, assuming the Government holds together, actually make a lot of sense to me.

A radical reform of the Italian income tax system is about to take place, and one which is long overdue in my opinion. Not for any populist reasons, but for more practical reasons which I will expand on below.

The proposed flat tax regime
If you want to have a look at the Contratto per il Governo di Cambiamento, then you can do so HERE. It makes interesting reading, if not full of more blurb than actual facts at this stage. However, its a start.

So, going back to the issue of the flat tax. The proposal, soon to be put into force, is to reform the tax regime into 2 flat tax rates, namely 15% and 20%. This sounds very new and certainly will win a lot of those populist votes. But first let’s take a look at how income is currently spread in Italy and the following chart shows just who it would affect:

It’s quite interesting to note from this chart that 80% of the tax paying population of Italy earn up to €29000. The median declared income is €19000pa. Those may sound strange numbers but when you consider the current Italian tax rates (see chart below), you can start to form an idea that there is probably a little bit of fiddling of the figures. After €28000pa in reddito complessivo the tax rate jumps from 27% to 38%. With this in mind, the proposal of a flat tax could potentially bring in alot of, currently, undisclosed (let’s call it what it really is: ‘in nero’) money to the Government coffers.

A QUICK REMINDER OF ITALIAN INCOME TAX RATES
(IRPEF – Imposte sul reddito delle persona)

€0 – €15000  = 23%
€15000- €28000  = 27% (€3450 + 27% on the part over €15000)
€28000 – €55000  = 38% (€6960 + 38% on the part over €28000)
€55000 – €75000  = 41% (€17220 + 41% on the part over €55000)
over €75000  = 43% (€25420 + 43% on the over €75000)

How might it work in practice?
The new proposal is to have a flat tax of 15% on a combined ‘reddito famigliare’ of upto €80,000pa. If your ‘reddito famigliare’ is above €80,000pa then the flat tax rises to 20%.
A proposed maximum tax of €3000 would apply for every member of the family where they have a individual ‘redditto complessivo’ of no more than €35000pa. This would be limited to families where the ‘redditto famigliare’ is between €35,000- €50,000 pa.

In short, the most generous tax deductions are for those who have a ‘redditto famigliare’ between €40000 and €60000pa.

A straniero example……
This all sounds very exciting and some what overly generous for a country which has historically taxed its citizens up to the eyeballs. However, let’s use an average straniero example to see what difference it would make.

Let’s assume that we have a retired couple, with state pensions (€8000pa each) and private pensions of €18000 and €3000 respectively. They also own a property in their home country which generates a UK income of €8000pa (jointly owned). They have investments and savings, but for the purposes of this example they are not relevant as the proposed measures are for income tax only.

Under the current regime the income of each individual would be subject to taxation.

Spouse 1: €8000 + €3000 + €4000= Total €15000pa The tax rate applicable would be 23% therefore the tax would be €3450

For the purposes of this example I am not including any benefits, or credits that might be avaiable to any one individual or another

Spouse 2: €8000 + €18000 + €4000 = €30000pa Spouse 2 exceeds both band 1 and 2 and will enter the higher rate tax bracket creating a taxable liability of €7720

THE TOTAL INCOME TAX BILL WOULD BE: € 11170 per annum

Under the new proposals both spouse 1 and spouse 2 would pay a flat tax of 15% on their combined income , meaning a total tax bill of €6750

A SAVING OF €4420pa

Let’s take a breath and calm down for a moment
So, before we all start getting very excited we all know the Italian Government is not the most coherent at the best of times and we are in an unprecedented era. It may be that this proposal is watered down yet and we get a half way house offer, but I expect that simplification and lower tax rates are on the cards. In the end the country still has to balance the books and attract foreign investment. If they don’t have enough money coming into the Government coffers to keep the system running smoothly (for lack of a better word :0)) then the money will soon dry up and punitive tax rates will have to be imposed to reap that which has been lost.

My soap box moment
And so I move onto my favouritie part of this E-zine. My soap box moment. You see, I have been wanting to write this formally for a long time but never really had the opportunity to do so. I would go on record as saying that I am actually in favour of this radical overhaul of the Italian tax system and whilst I see this proposed flat tax regime as being a little unequally distributed, I do think its necessary and despite what the bankers, economists and bureaucrats tell us, I actually think it would be a good thing for Italy.

The entrepreneurial zone
I have always waxed lyrical that, what I like to call the entrepreneurial zone, in Italy, is completely dead. Any good economics book will tell you that 80% of employment and growth in a society comes from small to medium sized businesses. That is the shop that opens and gets so many customers that they need to employ a young person to manage the business in the mornings, or a new online business which grows rapidly and needs to employ 5 new people to manage operations. It’s worth repeating that 80% of growth in an economy and job growth comes from this area. Not the Vodafone’s of this world or the multitude of other multinational businesses that pop up on the high street. It’s the small businesses and one man bands that grow into medium sized firms that cumulatively turn over billions in revenue each year. This is real growth. And this is what Conte ( the new Prime Minister) talked about in his first address to Parliament when he said that he wanted Italy to grow its way out of debt and not have to impose more austerity. He is absolutely right. The economics speak for themselves.

Which brings me back to the entrepreneurial zone. This is the area which I think is the most important. To take a business from nothing: an idea, a start up, to revenue of €50,000 each year and onto €250,000 each year you need incentive. It is in the Governments’ interest to incentivize you because you are going to employ the people and pay the taxes that will contribute towards 80% of the running of that country. And from there you may have the skills to turn that business in a multi million euro revenue business employing hundreds of people and contributing back even more into the running of the society. The problem with Italy is that after €28000pa in revenue they effectively chop you off at the knees (the tax rates rise astronomically + there is the dreaded social security contributions to pay. INPS) and let you see if you can hobble along and survive whilst they come running after you to chop off your arms, and then take the rest. It’s like being chased by a mad axe man without your legs and seeing if you can hobble faster than he can catch up with you before he hacks the rest off. It just doesn’t work. In my opinion, this is one of the main problems in Italy and why I think both Di Maio and Salvini have got the right idea when it comes to taxation. (The rest of their policies are open to debate, although some of those also have a lot of merit!)).

I am reminded of the conversations I regularly have with clients who recount stories of their children who set up businesses in Italy and either struggle on barely being able to keep the businesses afloat and or eventually closing down. A young business needs all the revenue it can get in that ‘ entrepreneurial zone’, that area between €0 and €100,000 pa. If a business is going well most of that income is going to be re-invested anyway and used to employ people or purchase goods and services. Europe has to support Italy at this time and allow that zone to flourish and provide opportunities to young and old entrepreneurs alike.

So who is responsible for change
There is always a counter argument for every case and clearly in this case, given the cultural back drop to Italy’s tax collection issues there will be economists who will argue that if income tax revenue were to drop drastically by lowering rates so much then how will Italy, ‘The State’, balance its books, after all there is nothing to say that people will suddenly start declaring all their income because the tax rate is more favourable. That is why the proposed tax regime has to be followed by some hardline clampdowns on tax evasion. Otherwise, it just won’t work.

I am going to follow these proposals closely, and feed back to you, to keep you abreast of any legislation changes. (Watch out for the summer months as they like to slip new laws in whilst everyone is on holiday). I am completely in favour of a total overhaul of the Italian tax system and dispute what the media, economists, and supposed experts say (I sound like a Brexiteer). I think drastically cutting tax rates in Italy, whilst having a short term impact on Government revenue would attract foreign investment in droves ( I mean if you had the chance to set up a factory in Huddersfield or one in Umbria, which would you choose?), it could increase investment rapidly, create jobs, create subsidiary businesses servicing the bigger ones, incentivize larger business to relocate because of the tax rates and could create a new economic boom for Italy. That being said, if it isn’t put into place with some heavy Governmental supervision then it could all fall apart and Italy’s days in Europe would be numbered. And therein seems to be the folly of the whole idea. Europe, whilst I love the European project dearly, has not treated countries like Italy favourably and should it continue on its current path without allowing any kind of change and only implementing austerity, then the likelihood is that Italy would eventually decide to Italexit.

Government has to lead
Italy, like any government around the world has to take the lead in forcing through sensible change. The young business people I know who are barely making ends meet are never going to fully declare every euro they earn when they have families to feed, medical treatments to take care of and childrens schooling costs to pay. And given the choice of making a ‘few’ euros ‘in nero’ and being able to look after the family versus paying into a corrupt state which merely extracts the money from you by osmosis for its own nefarious means, the choice is simple. Most families, if not all, will take that risk. They just have to. Or they move abroad!

So I am in favour of Di Maio and Salvini’s tax plans. I hope they manage to find a solution that will help everyone, mainly the poor and the entrepreneurs who want to prosper but don’t have the ability to do so because of draconian tax measures which should have been ditched long ago. It won’t be an easy ride, but I hope it’s a success. And in the end, should it pay off it may just keep Europe together. Can you imagine Di Maio and Salvini going down in the history books as the saviours of Europe!

(You don’t need to write to tell me that my artistic licence has been abused in this article, just enjoy and let’s see what happens. I, for one, am moderately positive about the future if they can bring about positive change in the tax system in the way in which they are proposing to do).

Given the proposed changes in taxes in Italy, it will be an important time to take a look at your own tax and financial planning arrangements and make sure that they are as tax efficient as possible.

Retiring & income in retirement

By Derek Winsland - Topics: France, Pensions, QROPS, Retirement, State Pensions After BREXIT, UK Pensions
This article is published on: 8th June 2018

08.06.18

A major part of my role as a Financial Planner involves helping clients move towards retirement and advising those in retirement about the best and most tax-efficient way of generating their income once they stop work.

One question I’m often asked is how much money I should save to enable me to retire comfortably. A good question, it depends on what constitutes a comfortable retirement for that particular person. It’s generally quite a straightforward discussion: how much do you need now, and what will change as you approach retirement (mortgages redeemed, no more school or university fees, travel expenses to and from work for instance). Factor in extra expenses for pursuing hobbies, travelling etc. and we begin to build a picture of what retirement will look like and how long the active retirement period will last for.

In the UK, a Which? survey concluded that, in the UK at least, a couple entering retirement needed £26,000 a year to live comfortably. OK, that’s the UK and not necessarily representative of life here in France, but it is a basis for opening a discussion. The next consideration is to identify what the sources of income are – likely there will be an entitlement to UK state pension, possibly some French state pension and maybe rental income form letting out the old UK home, or Gites in France.

For those people actively thinking about and planning for retirement, it is also likely there will be some private pension provision, perhaps even membership of a final salary pension from time spent working for an old employer. And then there are the savings you’ve set aside for the day when you can put down those work tools, and say “That’s it, I’ve done my bit”.

But what income can I reasonably expect those savings to generate to supplement the other sources of income. The Institute and Faculty of Actuaries have ruminated over this question (well they would, wouldn’t they! I can imagine the topic of conversation going around the dinner table at their annual conference). The conclusion they’ve come to is (not surprisingly) based on the life expectancy of the retiree. Retiring at age 55, they believe you should draw down only 3% of your capital each year to ensure that your money doesn’t run out. This then rises to 3.5% if retiring at age 65. Other financial experts believe the figures could rise to 5% per year for a 65-year-old. This then assumes that your capital is invested to generate returns greater than the rate of inflation.

The options for the individual facing an income shortfall include:

    1. Increasing your savings
    1. Decreasing your retirement income expectation
    1. Delaying retirement
    1. Exploring alternative ways of investing available capital and pensions to obtain growth greater than inflation and certainly better than bank interest

A Financial Planner can draw up a future forecast using established assumptions for inflation, rates of investment return, the most tax efficient way of drawing down or generating income, using either life expectancy tables or any other age after discussing your family mortality history with you. This will give you your ‘number’, the amount of capital you’ll need to live comfortably.

The Office for National Statistics has recently launched an online tool on its website designed to tell you what your life expectancy is. If you’re curious, click here:

Once completed this Financial Plan should be implemented to address any recommendations for re-structuring the existing assets, and thereafter reviewed yearly, updating the investment returns achieved and the impact this has on the capital, checking any changes that need to be made to the assumptions and making any amendments that you want included. Long-lost pension funds will be identified, and the expected benefits brought into the plan, and again, any issues addressed. The move is towards handing the responsibility of retirement over to the retiree, so there is not a better time to consult a fully qualified financial planner.

If you have personal or financial circumstances that you feel may benefit from a financial planning review, please contact me direct on the number below. You can also contact me by email at derek.winsland@spectrum-ifa.com or call our office in Limoux to make an appointment. Alternatively, I conduct a drop-in clinic most Fridays (holidays excepting), when you can pop in to speak to me. Our office telephone number is 04 68 31 14 10.