Summer 2017

The importance of reviews

Several important changes to tax and benefits were introduced at the beginning of 2017/18. So it makes sense to review your financial planning regularly to make sure it’s still fully effective. After all, last year’s sensible strategy could be this year’s tax trap.

Disciplined planning

It’s a good idea to check your investment portfolio at pre-determined intervals. This is preferable to looking at it almost daily when markets are soaring or falling through the floor, as those are just the times when your emotions can override your good intentions to be a long term investor.

You will get more out of these reviews if you make a short list of what you want to discuss, to supplement our agenda. You can start with basic things like checking your use of the current ISA allowance. This tax year, there have been two important developments to ISAs: first and most important, there has been a big increase in the annual amount you can invest in ISAs, now £20,000 – up from £15,240.

Efficient saving

The other big change to ISAs is the introduction of the new Lifetime ISA or LISA (see page 2). You can start with one if you are between the ages of 18 and 40 and you can either use it for buying a first home worth up to £450,000 or leave it to be drawn till you are 60. The good news is that the contribution (up to £4,000 each tax year) qualifies for the equivalent of basic rate tax relief.

Reviews can prompt you to consider some of those things that sometimes get left undone – such as your will, which might still need to be arranged or updated. Or perhaps there is a lasting power of attorney that has not been progressed or a life assurance policy that should be placed under trust. Life has a habit of springing unpleasant surprises on us when least expected.

The Financial Conduct Authority does not regulate tax advice. The value of tax reliefs depends on your individual circumstances. Tax laws can change. The Financial Conduct Authority does not regulate will writing and some forms of estate planning.

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investing in shares should be regarded as a long-term investment and should fit with your overall attitude to risk and financial circumstances.

In this issue:

Budget tax changes – set for a comeback?

The ISA family grows again

The residence nil rate band – not all it seems

Diversifying your investments

Think before you phase retirement

Just one more year…