Intelligent Money - your investment questions answered

[Intelligent Money]

Hi T7

I've not had anything through since our original messages. Can you resend? [e-mail]

Regards

Nik

[Intelligent Money]

Received this time

Thanks

[Intelligent Money]

Hi

I don't think I did, if you could let me know what time it was sent and an idea of the content I can check.

I haven't had anything that links to you PH user name so just need a bit more info so I can tie it up.

Regards

Nik

[Intelligent Money]

Hi Cooper2

Despite the advances in tech in the rest of the world banking tech still lags a little, it is usually 5 working days for the DD to process so it should be allocated to your account tomorrow.

Regards

Nik

[Intelligent Money]

Evening mate,

I think of myself as more like the shopkeeper in Mr Ben, when needed as if by magic I appear.

And while I happily leave you to enjoy the glory of the adventures I just keep my head down and do the hard work and make sure you have the right equipment for the adventure ahead.

Nik

[Intelligent Money]

We are all a little bit scared of Laura.

[Intelligent Money]

Hi Richardracer,

I think that the information on our website is the information that you are looking for. The performance data is based on the portfolio performance over the relevant time scale, 1,3,5 or 10 years. allowing for the active changes in asset allocation that our investment manager has made to adapt to changes in the markets over that time.

It is not a a representation of the performance of any particular static asset allocation at a particular point in time.

So as an example had you invested in our global growth fund 31/03/2014, then as of 31/03/2019 you would of enjoyed 54.03% of growth before charges.

Kind Regards

Nik

[Intelligent Money]

Hi Richardracer,

I think that the information on our website is the information that you are looking for. The performance data is based on the portfolio performance over the relevant time scale, 1,3,5 or 10 years. allowing for the active changes in asset allocation that our investment manager has made to adapt to changes in the markets over that time.

It is not a a representation of the performance of any particular static asset allocation at a particular point in time.

So as an example had you invested in our global growth fund 31/03/2014, then as of 31/03/2019 you would of enjoyed 54.03% of growth before charges.

Kind Regards

Nik

[Intelligent Money]

Hi Ben

Thanks for your question. The passive element is only half the story.
Our investment approach is active/passive, This means that our investment manager actively decides on the asset allocation and will make changes to this allocation to react to market changes and market outlooks as he sees fit. This means that we don't have to follow a market down and can shift the asset allocation at any given time. We then use passive vehicles to build that asset allocation. This allows us to keep the cost base of the portfolios down and pass more of the growth onto the investor.

The approach is based on the theory that it is difficult and expensive to try and beat the market so we aim to buy the market and the active element of our approach is about picking the right markets.

To answer your question about why use IM rather than buy the trackers yourself? It is about using our expertise to know which trackers to buy and when to make changes to your holdings. If you are confident and happy to build your own and keep track of them then there are a number of DIY options that you can use, if you would prefer to have an Investment Manager take care of those decisions for you then we are able to do that.

Moving on to your contributions. Your company can pay into your existing SIPP and obtain the relief. The contributions are treated as a business expense so as Julian said free of NI, Income and Corporation Tax. If you are interested to moving this over to IM it is a simple 5-10 minute application process. Drop me an e-mail at [e-mail] and I can send you some additional information or we can set up a call and I can talk you through your options .

Nik

[Intelligent Money]

No magic way of getting a pension contribution for free I'm afraid but you do get the Corporation Tax that you would of being paying to HMRC into your pension so it is a good way of redirecting a payment from the tax man to yourself.
Pension contributions are treated as business expense so if you have have cash left in the business making a contribution is a good way to get some of that cash out and save the corporation tax that you would have to pay if you leave it the business.

[Intelligent Money]

If you are looking for a good foundation and understanding of general financial planning, that includes Investment and Pensions along with Protection and general taxation principles then the CII modular approach to learning is as a good a starting point as any.

You will self study and build up your knowledge as you complete different sections of the course and can then complete more specialised and focused modules once you have the basics in place.

There are a couple of learning support firms around like Brand Financial training who supply some classroom support and and learning support guides that can make the dry core syllabus a bit more palatable.

The CISI approach is similar but has a more investment and pension bias so if that is the area that you are interested in then take a look at the modules they offer.

Once you have the basics taken care of it comes down to reading the financial press and keeping up to date with HMRC and legislation changes to understand how to apply the principles and what is available and what isn’t within what is quite a broad framework.

As with most things the academic and qualifications side of any specialist area is actually a small part of the whole picture. Application of the knowledge is the key bit, so keeping up to date with what is happening in the finance “real world” is as important as the anything else.

Hope this helps and happy reading,

Nik

[Intelligent Money]

Hi GP

Thank you for the good feedback. We have found some good returns in the last 6 months and I’m glad that you have enjoyed keeping more of the returns to yourself.

Nik

[Intelligent Money]

[/quote]

I think the value of having the likes of Nik is high - it felt to me like someone with wisdom & knowledge (you can edit that out before he reads it, Julian!) with OUR interests at heart, & within the framework of a (relatively) easy to understand investment vehicle.

& separately (as the thread has moved on since I forgot to click send hours ago!!): those IM 100 numbers look very interesting
[/quote]

Hi Mike,

Just wanted to bring your great and very accurate feedback about your client manger back to the top if the thread 😁. My real point is that I’m glad you feel the Financial Guidance and planning element of our Private Client Service adds value and thank you for taking the time to share your experience.
While we built it as a complimentary part of the service it is a fundamental difference in the service we offer. It aims to help clients make informed choices and feel empowered to understand the options available to them.
While fees are a key part of any investment proposition, and we always work hard to make sure we keep them as low as possible when you also consider the service element of the Private Client Manager I’m confident we do offer a total package that provides great value.

Nik

[Intelligent Money]

Hi daimlerv8

I'm sorry to hear about your wifes diagnosis.

Julian is right, it can get complicated with regarding to IHT when switching your pension with ill health issues involved.

Recent HMRC challenges have helped clarify the main areas to consider but as with many IHT cases they are often taken on a case by case basis.

Please feel free to drop me an e-mail at [e-mail] and we can have look at your position and talk you through your options.

Nik

[Intelligent Money]

Hi Rob,

As Julian has posted, just leave the drop down menu box on the left as "other" and then add the provider name and postcode on the right hand side of the application. The post code for Virgin is NE3 4PL.

Just drop me a mail at [e-mail] if you need any more help.

Nik

[Intelligent Money]

dmahon said:

Julian suggested I post my pension question here. Rather than copy and paste, I will add a link.

https://www.pistonheads.com/gassing/topic.asp?h=0&...

Thanks!

Hi dmahon,

My apologies for the delay, A long trip back through some bad traffic so a late finish and I have some family commitments this evening so I will pop a summary of how this works up over the weekend.

Regards

Nik

[Intelligent Money]

dmahon said:

Julian suggested I post my pension question here. Rather than copy and paste, I will add a link.

https://www.pistonheads.com/gassing/topic.asp?h=0&...

Thanks!

Hello again dmahon

Here is a more detailed answer to your question. I hope it helps.

It is probably best to answer this by going through the carry forward and taper relief process stage by stage.

The first stage is to calculate this years allowance.
Calculating this tax years allowance can be a little more complex where taper relief applies, and as you have identified revolves around Adjusted and Threshold Income. Anti Avoidance legislation in 2015 now means that salary sacrifice pension contributions are added back in to both Adjusted and Threshold Income. However you can deduct personal contributions.

Adjusted income is all your taxable income plus all pension contributions minus any personal contributions.

Threshold income is all your taxable income plus any salary sacrifice set up after July 2015 minus any personal pension contributions (Gross)

If your adjusted income is over £150k and your Threshold income is above £110k the taper relief applies at a rate of £1 for ever £2 that your adjusted income is above £150k.

You now know your allowance for this year.

You can then go back three years and make use of any unused allowance from the previous three years, beginning with the earliest year first and then working through to the current year.

Each year is treated in isolation so you can go back and work out what your allowance was in each year, deduct any contributions made in the year and the balance is the allowance that you can carry forward to this year.

If taper relief applied in any previous year then carry forward any of the unused allowance with the taper applied.

So taper relief is only applied in any tax year where your adjusted income was over £150k and your threshold income was over £110k

By adding together the unused allowance for the previous three years and this years allowance you now have a figure that tells you how much you can contribute this year without being subject to an annual allowance charge.

Any contribution above your allowance will be subject to a charge.

If this is greater than £2,000 and is due to over payment into one scheme, you can request that the scheme administer pays the charge and it can be deducted from the pension fund.

I hope this helps clear up the position for you. While pensions offer great tax benefits and are a very efficient way of investing for retirement there are a few wrinkles that can catch you out.

If you need any further detail or would like me to look at your position in a little more detail just drop me a pm to [e-mail] and I will be happy to help.

Regards

Nik

[Intelligent Money]

jonnydm said:

Not at all unhelpful, the value add is important and will hopefully only grow in that importance over time!

How best to get the ball rolling with yourselves?

Hi Jonnydm,

You can either go to our private client site :https://www.intelligentmoney.com/private-clients and follow the application process via "apply" on the top right, or if you would like to talk through how we work and our investment approach in more detail drop me a pm at [e-mail] and we can set up a chat and you can find out if we are right for you,

Nik

[Intelligent Money]

KTF said:

Another question about AVCs. My understanding is that you can pay up to an additional 40k a year and can backdate this 3 years if you have not previously used up your allowance.

Is the backdating option a one time event or can it be used multiple times. i.e. Do you get one opportunity at paying in up to 120k or is it on a continuous rolling 3 year basis?

Also does the payment have to be made to a pension you are currently paying in to (current employer one) or can it also be to a deferred one (if you have more than one)?

Hi KTF,

You can contribute £40k p.a. or 100% of your taxable income, whichever is the lower, in any tax year. This is the total amount that you can contribute so any existing contributions need to be taken into account before making additional payments.

To carry forward previous years unused allowance you must first maximise this years contribution, you can then go back three years and use up any unused allowance from previous years. Carry forward isn't a one time event you can make use of it at any time that you have unused allowances from the previous three years.

You can make the additional payments into any pension plan, so you can contribute to any existing plan you have or you could set up a new one.

I'm happy to take a look at your circumstances and let you know what your options are if that would help. You can PM me at [e-mail]

Regards

Nik

[Intelligent Money]

The amount that you hold in an emergency fund is a very personal thing and will vary for a number of reasons, some objective and some subjective the key is coming to a number that you are comfortable with.

It is then a case of remembering what that money is there to do, and growth is typically not its main objective so the rate of return is usually secondary to access and certainly of value.

Having this cash in the right place also allows you to leave other funds to function as you want them to.

Building your investment strategy is often about understanding and remembering that you will have funds in different areas that may have different objectives and not getting too hung up always chasing returns.

Nik