Secondary
ARE you enjoying that increase in the rate on your savings account or ISA? No? What do you mean it hasn’t happened…? As people across the land are discovering, when the interest rate goes up, businesses are quick to tack it on to money you owe, but aren’t exactly rushing to do the same when it comes to savings.
The problem with the rubbish savings rates of the past decade has been the increase in normally cautious investors taking bigger risks to beat inflation. And worryingly, I’m increasingly being asked about investing in crypto-currencies like Bitcoin (don’t).
A recent survey found that huge numbers of people had completely unrealistic expectations about their investments – the average anticipated returns being 9%. These expectations are usually linked to low-risk investments and are hopelessly optimistic. Greater returns are possible – but are fraught with risk.
As I always say, if you’re taking out a high-risk investment, you’ve got to be prepared for losing some or all of it. Medium to high-risk investments are not for novices – and you can’t complain solely about underperformance because it’s not generally guaranteed.
You can, however, complain about being mis-sold. The rules around selling investments in the UK are among the most comprehensive on earth.
Now the vast majority of I HAVE heard the Government is looking to introduce a new law to combat pension scammers and fraudsters. Do you think this may mean the secondary annuity market may have a chance of being introduced now, to extend the pension freedoms to those of us who were forced to buy annuities? ANY new measures to combat and protect pension funds from a potential scam will be welcomed I’m sure. However, I don’t think this will mean a U-turn on a secondary annuity market as the Government believes if this was brought in the only winners would be the insurers. financial advisers do a great job. But it pays to be completely honest about your inexperience if you’re considering taking out single or multiple investments.
A good adviser should suggest a balanced ‘spread’ of investments so any losses are outweighed by safer things like bonds and gilts. They should fully assess your financial situation, give you time to consider it and tell you exactly what to expect for the risk level you agree on.
If you’re looking for good, independent financial advice, speak to friends and family for recommendations. But be cautious and always check if the adviser is regulated and what other customers have said about them online.
There are a number of websites that can link you up to a suitable adviser. Check out MoneySavingExpert or the Money Advice Service for options if you’d like more information.
Advisers used to make their I READ in your column about someone who may be entitled to their deceased wife’s pension. Was that the state pension or is it just personal pensions that can be accessed by spouses? IN THAT instance it was state pension. To recap, a widow, widower or surviving civil partner may be entitled to some state pension based on the National Insurance contributions of the deceased, if they have not built up a full basic state pension on their own National Insurance record. I’VE been checking my pension income and money largely from commission, but the rules changed to stop that as there was an incentive for less scrupulous ones to go for policies that paid out more. Now you have the option of paying the cost of seeing a financial adviser upfront, on a percentage of what you invest or even hourly rates.
Most importantly, you have the right to ask for further clarity if you don’t understand anything. Loads of people don’t feel that they can do this, but it’s vital!
It’s becoming increasingly difficult to predict how the markets will perform in these volatile times. So take professional advice if you’re going to have a punt on investments – and make sure you understand the risks – don’t just focus on the returns.
Are you worried about your investments? Get in touch at press@resolver.co.uk. Find out more about your rights and make a complaint at resolver.co.uk realised that the private pension I receive went up slightly in April, but the amount of tax I pay has gone down. My tax code seems to have changed. Do you think I may have been paying too much tax for years before this? PROBABLY not but I can’t be 100% sure. The more likely explanation is the personal income tax allowance threshold increased more than your income did. But it may be worth checking with your tax office to ensure you are paying the right amount of tax. Financial editor Tricia Phillips answers your questions