Pentins Financial Planners Ltd

It was an exciting day that showcased technology as a force for good in the professional services space of Financial Planning. Pentins feels that an end to end technology solution for small independent adviser practices is a real possibility now that Timeline have partnered with Seccl to launch a custody platform. The future looks brighter today. Thank you Abraham Okusanya and David Ferguson - willing you to succeed and wishing you well.

A great event at the NEC 'Festival of Financial Planning'
We want to with wish Sam all the best as she takes to the YELLOW stage to speak about her primary research into the shortage of women in financial planning.

HMRC (Her Majesty’s Revenue & Customs) will issue taxpayers with a “Notice of Coding” in the first few months of the year informing them of the new code for the new tax year starting 6 April 2022. This is sometimes referred to as Form P2.

The most common code will be 1257L. This relates to the new Personal Allowance of £12,570. This represents the amount of income you can receive, under normal circumstances, before having to pay income tax.

HMRC (Her Majesty’s Revenue & Customs) will issue taxpayers with a “Notice of Coding” in the first few months of the year informing them of the new code for the new tax year starting 6 April 2022. This is sometimes referred to as Form P2.

The most common code will be 1257L. This relates to the new Personal Allowance of £12,570. This represents the amount of income you can receive, under normal circumstances, before having to pay income tax.

Despite the importance of understanding what kind of retirement your savings will afford, it’s a task many are putting off.

An Aviva survey found 53% of people in their mid-life have never calculated when they can afford to retire and 61% have never requested a State Pension forecast. A mid-life pension check can give you confidence in your future and mean you’re able to look forward to retirement.

Analysis found that two-thirds of those aged 50 to 65 are under-saving for retirement.

If you reach retirement age and find there’s a shortfall in your pension, your options are limited. You may have to carry on working for longer or settle for a lifestyle that doesn’t match your aspirations.

In contrast, finding a pension gap when you’re middle-aged gives you an opportunity to plug the gap. Increasing regular contributions or adding a lump sum can get you back on track. It means you know what income you can expect in retirement and look forward to a secure lifestyle.
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We have closed our office today (Friday) due to the weather, but rest assured if you need us we will be available on phone or email.
Stay safe out there!

Millions of pension savers are underestimating how much they’ll need once they give up work. It’s a miscalculation that could lead to a retirement that doesn’t meet expectations. Even if retirement seems a long way off, a pension health check can make sure you’re on track. It’s far easier to bridge a pension gap if you recognise the shortfall early.

Don’t miss the deadline - Self-assessment tax returns must be filed by 31st January.

Midnight on 31st January is the latest date for filing your online tax return with HMRC (Her Majesty’s Revenue & Customs) for the last tax year which started 6 April 2020 and ended 5 April 2021.

Leave it any later and you will be in for a £100 late filing penalty plus interest.

https://www.gov.uk/self-assessment-tax-returns/deadlines

Everyone at Pentins wishes you a happy and healthy festive season. The office will be closed from midday 24 December until 4th January.
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You don’t have to take your tax-free lump sum as soon as you reach retirement age to use it.

You can leave your pension untouched and take the tax-free lump sum at a date that makes sense for you. This way, your pension remains invested and has the potential to continue growing. While you can access your pension at 55, you may not be ready to retire for a decade or more. An extra 10 years of investment returns on the lump sum you could have withdrawn can have a real impact on the size of your pension when you retire.

What’s more, you can spread out the tax-free benefit too. Rather than taking a single tax-free lump sum, you can withdraw multiple lump sums, of which 25% of each is tax-free. For some, this can help manage your tax liability and ensure your income suits your needs.

So, there’s more than one way to take advantage of the tax-free lump sum when accessing your pension. If you’re thinking about making a withdrawal from your pension and you’d like to discuss which option makes sense with your retirement goals in mind, please contact us.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation, which are subject to change in the future.

While you may be thinking about kickstarting retirement by ticking off bucket list items by using your tax-free lump sum, you need to look at the bigger picture too. You save into a pension to create an income throughout retirement, not just those first few years.

Taking a quarter of your pension to spend from the outset can have a huge impact on the income your pension will deliver for the rest of your life. As a result, it’s important to consider the pension lump sum in the context of your wider retirement plans and ask questions like:

How long does my pension income need to last?
What income do I need throughout retirement?
Do I have a buffer in case of the unexpected?

It can be difficult to understand how taking a lump sum now could affect your income in 20 years. Financial planning can help you weigh up the long-term impact of the decisions you make now. In many cases, clients find they can afford to pay for retirement goals and have financial security, but reviewing your financial plan before you take a lump sum out of your pension means you can have confidence and fully enjoy the experiences you’re looking forward to.

The first thing to think about is what you would do with the money if you did take the tax-free lump sum.

Whether you want to book a once in a lifetime trip or lend a helping hand to family members, setting out where the money will go can help you understand if it’s something you want to pursue. In some cases, there may be alternative ways to fund your plans, allowing you to leave your pension untouched.

Some people take their tax-free lump sum without any plans to use the money. It can be tempting to take the lump sum simply because it’s available to save for a rainy day. However, adding a lump sum to a savings account means it’s likely to lose value in real terms. Interest rates are lower than inflation, so the spending power of the money will decrease over time.

You may also consider withdrawing the money to invest it. However, keep in mind that your pension is usually invested and is a tax-efficient way to save for retirement.

What are your plans for your first few years of retirement?

Being able to take a tax-free lump sum from your pension can open up a whole host of possibilities. But would you be better off leaving your money invested?

When Pension Freedoms were introduced in 2015, it gave retirees more flexibility. One of the benefits introduced was the ability to take up to 25% of your pension without paying Income Tax on it once you reach 55, rising to 57 in 2028. It’s certainly an attractive option and can mean you have the cash to turn your retirement dreams into a reality. From undertaking home renovations to travelling the world, you could start your retirement in the style you want by taking a lump sum.

It’s an option that proved popular among retirees. According to Financial Conduct Authority data, between October 2019 and March 2020, £3.8 billion was withdrawn from pensions as tax-free cash. While it can be tempting to take the money on offer, there are a couple of questions to consider first.
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Deadline to register as self employed with HMRC - 5 October

According to HMRC, you should register at the earliest opportunity. However, there's a deadline – legally you need to register by 5 October after the end of the tax year in which you became self-employed. For example, if you started your business in July 2021, you'd need to register with HMRC by 5 October 2022.

Congratulations to Jack who won our staff Premier League Fantasy Football tournament back in May 2021. Here he is with his winnings, before England were knocked out in the Final and we have started a new season already. How time flies.

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Money has a huge impact on our wellbeing.....

Whether we have “enough” is often the focus when facing money challenges, but a new report suggests that our mindset and relationship with money could have a far bigger influence on wellbeing.

Past research has linked financial concerns with poor wellbeing. The latest research from Aegon notes this as well. It found those with money worries experienced:

Feeling anxious (45%)
Sleepless nights (26%)
Lack of motivation to finish daily tasks (16%)
Relationship troubles (16%).

Where this report differs is that it looks beyond things like income, emergency fund or long-term savings to assess people’s mindset.

The findings indicate that how you think about money, particularly over the long term, can improve wellbeing. Just 16% of the population are fortunate to combine healthy finances with a positive mindset, but it’s estimated five in six people could take steps to improve financial wellbeing by changing the way they think.

If you'd like a chat, click 'book now' in the bio

In 2015, Pension Freedoms were introduced. This gave retirees far more flexibility and freedom over their income in retirement. However, the greater choice has come with more responsibility and extra complexities.

Those retiring in the last five years and the coming years are likely to enjoy a lifestyle that is very different from their parents. Part of this is because of the flexibility in how you can access your pension.

Previous generations would have given up work on a set date, often purchasing an annuity with their pension savings to generate an income that would be guaranteed for the rest of their life, creating income security throughout retirement. Today, retirees may choose a phased approach to retirement, meaning they need to access a portion of their pension while still earning an income. Or they may choose to flexibly access their pension to suit changing income needs through flexi-access drawdown over an annuity.

These increased options allow retirees to match their income with their lifestyle goals. But it also means more decisions need to be made, including how much income to take and considering how this relates to financial security later in life.

If you'd like a chat, click 'book now' in the bio, we look forward to speaking with you.

Saving into a pension and accessing it comes with a lot of challenges as you need to think about how much income you need throughout retirement.

Research from the People’s Pension suggests that looking at the bigger picture is something many people are putting off, even as they near retirement age and start drawing an income. It’s an outlook that could mean they face financial insecurity later in life or even risk running out of money in retirement.

We can tell you about the sorts of things we can do to help and we don’t charge for an initial meeting. Click 'book now' in the bio for a chat.

Pentins Financial Planners Ltd updated their business hours.

"Since 2019, concerns over deposit amounts among younger generations have risen 30 per cent, according to research from Santander.

Last year, these first-time buyers put down an average deposit of £57,278, compared with £46,449 in 2019. Back in January, Halifax calculated a deposit rise of more than 23 per cent in 2020."

Pandemic deposit levels fenced out 44% of first-time buyers Nearly half 44 per cent of the UK s first time buyers delayed buying their first home last year due to the pandemic induced rise in deposit requirements

Our independent advisers are able to select product for customers from the whole of market – that means they can potentially recommend any product from any company providing it suits your needs and objectives.

With such a wide choice of companies, investments and saving tools you can be reassured that you are not simply being provided with a standard recommendation – and are getting truly personalised advice.

Warning over hidden costs of retiring abroad Retiring abroad is no longer a feasible option for any but the most wealthy Blevins Franks Financial Management has warned

"More than 450 investment firms have signed a letter urging governments around the globe to improve climate-related regulation."

Hundreds of investment firms unite in climate change push More than 450 investment firms have signed a letter urging governments around the globe to improve climate related regulation

Pay is becoming an important topic for investors, research suggests. In fact, 83% of savers said they expect the companies they invest in through their pension to pay the “living wage” and some would be prepared to take action, according to a PensionBee survey.

ESG investing: Employee pay becomes a key issue with a third of investors willing to divest - Pentins Financial Planners Pay is becoming an important topic for investors, research suggests. In fact, 83% of savers said they expect the companies they invest in through their pension to pay the “living...

"The Green Technical Advisory Group (GTAG) will oversee the delivery of the green taxonomy in the UK, giving advice to the government on developing the framework, supporting investors, consumers and businesses to make green financial decisions and will clamp down on greenwashing."

Government creates working group for green taxonomy The government has created a working group to help it create a green taxonomy in the UK