Month: January 2020

market
ArticlesMarkets

Top Five UK Money Transfer Markets Receive More Than £10bn

market

Top Five UK Money Transfer Markets Receive More Than £10bn

New analysis reveals the top five money transfer markets for UK residents that account for nearly one third of the total sent home.

New analysis by Paysend, the UK based fintech, reveals that just five markets account for nearly one third of the total money transferred home from the UK.

Paysend analysed the latest data from the World Bank.  It shows that foreign workers, international students and expats in the UK send money to more than 130 countries worldwide.

However, of the £24.2bn sent home in 2018, more than £10bn is sent to just five markets.  The top 10 markets account for more than half of the total, receiving £13bn in total.

Rank

Market 

Amount sent

1

India

£3.04bn

2

Nigeria

£2.97bn

3

France

£1.63bn

4

Pakistan

£1.44bn

5

China

£1.14bn

6

Poland

£1.13bn

7

Germany

£990m

8

Spain

£900m

9

Philippines

£591m

10

Kenya

£563m

Alberto Macciani, CMO of Paysend, said: “Moving money changes lives. We can see how a group of new internationalist workers, students and expats are driving the growth of money transfers in the UK. Often these transactions are life changing for those that send or receive them. Money transferred might go on education, healthcare, or to give families the ability to buy a home or start a business”. 

“Rather than simply acting as a ‘hand out’, research shows that money sent back home creates independence and sustainability, for the recipient and their communities and especially for women it represents a vital source of independence and equality.” 

Launched two years ago, Paysend’s card-to-card money transfer service, Global Transfers, already serves over 1.3m users worldwide.

The growth stems from the emergence of increasingly mobile segments of the work force and the continued growth of international students.  These are people who live and work in one country while financially providing for, or relying on, others in another country. 

Some 270m foreign workers will send $689bn back home this year, according to the World Bank. This figure is a landmark moment.  Global money transfers have overtaken foreign direct investment as the biggest inflow of foreign capital into emerging economies.

Alberto Macciani continued: “Global Transfers enables our customers to move money in an instant.  With fixed, transparent and low fees, more of our customers’ money is enjoyed by those they care about. We focus on making our key corridors more efficient, but at the same time we work to improve our geographic coverage to ensure we are building a true global outreach.

We’ve made what was once a laborious, slow and expensive process to pay, hold and spend money across borders now simple, quick and low cost.  We will launch new services soon to make paying, holding and sending money globally even easier and cheaper.”

tax
ArticlesTax

7 Of The Most Common Tax Mistakes (And How to Avoid Them)

tax

7 Of The Most Common Tax Mistakes (And How to Avoid Them)

Entrepreneurs are talented individuals. For many of them, however, wearing the many hats required to succeed in their role means there is little time left for the onerous aspects of the job. Under these circumstances, it can be all too easy for potentially costly tax mistakes to emerge. In fact, a 2019 survey suggests that 19% of those who completed a tax return in the past two years believe they may have made an error that resulted in lost income.

In this article, we’ll be taking a look at seven of the most common tax mistakes and how best to avoid them. 

  1. Not Allowing for Allowances

Whilst the majority of people will be aware of the Personal Allowance, there are a variety of other allowances for you to take advantage of. An example of this is the Personal Savings Allowance, which entitles basic rate taxpayers to earn up to £1,000 worth of interest tax-free.

The extent of this allowance is dependent on the rate of tax you pay. Higher-rate taxpayers are subject to a reduced allowance of £500, whilst those in the 45% tax bracket cannot benefit from either a Personal Allowance or a Personal Savings Allowance. This is because these allowances are removed on a tapered basis in cases where a person’s income exceeds £100,000 per annum.

The range of allowances available doesn’t stop there. If you have capital assets at your disposal, you can generate a further £12,000 of gains before paying Capital Gains Tax on the profits. Self Employment and Rental Income Allowances are also available, allowing you to earn up to £1,000 tax-free from either of these income streams. If income exceeds £1,000, you can take a round sum, £1,000 deduction with no requirement for receipted expenses or claim actual expenses if this figure is higher.

There is also a Dividend Allowance available, which charges the first slice of dividend income at 0%. As such, it is perhaps better described as a tax rate rather than an allowance. Having said that, any freebie from HMRC is nonetheless worth taking.

 

  1. Counting the Cost of Expenses

Another way in which entrepreneurs miss out has to do with claiming expenses. Not every business cost is a tax-deductible expense, but there are a number of areas in which many business owners overlook making a legitimate claim.

Generally speaking, you can only claim relief for expenses on things that are used ‘wholly and exclusively’ in the business. However, there are some exceptions in cases where there is a split of use, for example in cases where you work from home or are using a personal car for work. 

The expenses you’ll be able to claim will be calculated differently depending on whether you’re employed (possibly by your own company) or self-employed. You’ll only be able to claim for things for which you have not been reimbursed by your employer in order to avoid you receiving the same benefits twice.

It’s important to note that receiving tax relief doesn’t mean you’re getting an item for free – the reimbursement amount is dependent on your marginal tax rate. If you’re a basic-rate taxpayer, this means you could be refunded 20% of the cost, while higher-rate taxpayers may receive up to 40% of the cost back.

 

  1. Failing to Maximise Pension Contributions

It’s possible to secure extra tax relief through making the most of your pension contributions. While employer-funded contributions and those deducted from pay do not generate additional relief, you could get an extra bonus from the taxman if you make personal contributions into your own pension plan or self-invested personal pension (SIPP).

All contributions of this kind currently benefit from basic-rate tax relief at source, meaning that the benefit to people paying tax at this rate goes directly into their pension fund. Higher and additional-rate taxpayers may be entitled to further tax relief on personal contributions paid by claiming extra tax relief from HMRC.

There is a limit on the amount of pension contributions on which you can obtain tax relief during the tax year, although this doesn’t mean that you can’t contribute more. You can also carry forward unused allowances from the previous three years as long as you were a member of a pension scheme throughout that period of time.

 

  1. Missing Out on Readily Available Tax Reliefs

Many entrepreneurs are unaware of the range of tax breaks available to them, causing them to miss out on invaluable opportunities to reduce their tax bill. Common examples include Research & Development (R&D) Relief, Entrepreneurs’ Relief, Investors’ Relief and Business Relief on gifts. Whatever the case, enlisting professional tax advice can go a long way in helping you make a successful claim. 

 

  1. Not Accounting for Payments on Account

Cash flow is a crucial consideration for any business, but personal tax cash flow is deserving of equal consideration. The majority of people are aware of the deadline for paying any outstanding tax bills, but unless 80% or more of your outstanding tax is deducted at source (e.g. for employees) or the amount due is less than £1,000, you will also need to make advance payments with regard to the following year’s tax liability.

Each instalment will generally be half of the previous year’s tax bill, with one half due on 31 January and the other on 31 July. This means that in January, you could be paying one-and-a-half times your annual tax bill. If you don’t believe your tax bill for the following year will be as high as it is now, you can ask HMRC to reduce your payments. However, if you underestimate the amounts due, HMRC will charge you interest back to the original date of payment.

 

  1. Not Making Charitable Donations

Whilst the primary reason for making a charitable donation is often altruistic, doing so can also provide you with a valuable tax break. The same can be said for the charity in question, with gift aid increasing the value of donations through allowing charities to reclaim the basic tax rate on your gift. In practice, this means that a gift of £100 would instead be worth £125 to the charity.

In a way that is similar to pension contributions, higher and additional-rate taxpayers can claim extra tax relief on charitable donations. If, for example, you donated £500 using gift aid, the total value of your donation will be £625 to the charity. This means the additional tax relief you can claim is £125 if you pay a tax rate of 40%, or £156.25 if you pay a rate of 45%.

 

  1. Not Seeking Expert Advice

Perhaps unsurprisingly, faulty tax returns are not accepted by HMRC. As such, tax return forms that are not completed in the correct manner or fail to provide a sufficient amount of information are likely to be rejected, resulting in further hassle in the long run.


One of the best ways of avoiding a long and drawn-out process is to seek professional tax support from an expert tax accountant. If you’re unsure about any aspect of your tax return, enlisting help early on can help save you significant time and expenses.

car dealer
ArticlesFinance

How to Find the Cheapest Car Loans

car dealer

How to Find the Cheapest Car Loans

If you’ve found your ideal vehicle, whether it’s a dream premium sports car or a practical SUV to run the family around, you’ll now need to finance it. If you’ve got the savings to do so, great, but for the majority of you this will not be an option. You’ll need to look for finance options to do this instead, involving finding the right lenders to offer you the terms that you need. This should be a simple process but can be difficult due to the sheer amount of options out there. Here are some of the ways you can reduce your costs and find the cheapest car loans.


Compare Online

One of the easiest ways to find the best offers for a loan against a car is by using an online comparison tool. You should check how the offers are ranked, ensuring that you look at the deals that are best overall. The reason why you should do this is just because an offer has the lowest value repayments per month, doesn’t mean it will be the lowest value overall. You may have to pay a higher interest rate with lower monthly repayments. A comparison site will be able to speed up the process of searching for loans much quicker, as within a few clicks you’ll be able to see all the available offers for you on the market. This can include banks and online direct lenders so that you have a full overview. Filtering the results correctly will help you see the best overall deals, and with most online lenders, you can get quick approval and same day funding if approved.

 

Check Your Credit Score

Ideally, you’ll already know what your current credit score is, especially before you start applying for loans. You can do this by getting in contact with a credit reference agency who can show you what your rating is. Normally, you can see your score without charge, but if you want to see a more detailed report, you’ll need to either sign up or pay a one-off fee. If your score is currently showing good to excellent, you won’t need to worry too much about finding out the details of your score. However, if it is lower than expected or showing fair to bad, you should spend the time to find out what is causing this. You may already know what is causing this, such as multiple missed repayments or a default against your name. By finding out what the issue is, you can then work out if applying for further finance is going to be beneficial or only cause you to have a negative mark on your report.

 

Consider Leasing as Well as Car Loans

With so many loan options available, you may have overlooked the option to lease the vehicle you want. With a reported 9 out of 10 people confused over motor finance options, you may prefer to look at the available lease options. Leasing means you can choose a car to have over a 3-5 year period, paying monthly instalments, sometimes with a deposit upfront. At the end of the term, you can then give the car back and change to a different one if you prefer. Although you won’t own the car outright, it’s an increasingly popular way to afford a higher value vehicle. Monthly repayments are usually affordable, and you have the option of changing your vehicle to another new one every few years. 

 

Pay a Bigger Deposit

If you can afford to, you should definitely pay a bigger deposit when searching for car loans. If you can raise the funds, or preferably save up over a number of months, you can pay a larger upfront cost. This way, you can reduce your monthly loan amount considerably, saving huge amounts in interest. The idea is to not have to take out a loan over too long a period, meaning the amount of interest should be lower overall than if you kept it for an extra year or two. It may seem like you’re spending more money to begin with, but overall the total costs involved will be much less. If you can find lenders that will take a larger deposit you should consider doing so. Some lenders may not prefer this as they will not make as much interest on your loan, so shop around and ensure that the one you go with will allow this. Additionally, if there is an option to clear the balance quicker or earlier, you should go for loans that allow this. Keeping these points in mind will help to ensure you will always find the cheapest loans on the market for you.

bank of england
BankingCash Management

Traditional UK Banks Are Failing To Engage With Users

bank of england

Traditional UK Banks Are Failing To Engage With Users

One in five UK bank customers happy to see branches close in favour of improved digital experiences.

Boomi™, a Dell Technologies business, announced the results of its research on banks’ engagement with their customers. The research finds almost one in three (30%) UK adults consider the search for a better customer experience in digital interactions the main driver for changing banks.

The research quizzed 6,000 adults across the UK and Europe on the customer experience provided by their bank, and how the bank meets their needs.

Currently, nearly one in five (17%) UK customers believe their traditional bank feels ‘a bit old’ and they are looking for an improved digital performance. A fifth (22%) would even be happy if their bank closed its branches if it resulted in an improved mobile app / online banking experience. This figure rises to over a third (39%) among those aged 18-24, who also prioritise having a good banking app (58%).

The results showed traditional UK banks are not engaging with customers like they used to, and are failing to adapt and mitigate this, showing a deep disconnect between modes of communication chosen by banks (email 39%, mobile app 24%), versus those preferred by customers (phone 71%, email 69%, mobile app 62%). Most customers remain with their banking provider just through force of habit (39%), despite citing a good online banking experience (37%) and a good mobile banking experience (35%) as paramount.

The most dissatisfied customers are in the UK

On average, other European countries such as the Netherlands (33%) and Sweden (33%) are happier with their digital banking experience than UK customers (24%). The survey also found that EU banking customers (72%) don’t change banks, but add additional banks, with one in five holding a digital bank account with challenger banks like Monzo, Starling or Revolut as well as their ‘traditional’ bank account.

As of January 13th 2018, Open Banking has required banks to increase transparency and open APIs to enable third-party developers’ access to their account holder data and services. Just 21% of respondents, however, report their current bank offers open banking services, while 66% are not sure if it does – indicating a requirement for further education on the topic.

“New account holders won’t hold the same loyalty to their bank as previous generations have. New players entering the market have challenged the industry status quo thereby setting a new standard around the digital banking experience, forever changing customers’ expectations. Customers are looking for more than better products when choosing their next provider,” said Derek Thompson, VP of EMEA at Boomi.

“It’s therefore critical that banks assess their current IT ecosystem, ensuring they’re not held back by their legacy infrastructure and can quickly unite their digital ecosystems, deploying more agile technology to transform customer experience,” he added.

When asked why they bank with their current provider, a good all-round customer experience (44%) was the main reason cited by respondents, followed by having “always been with them” (39%) and “enjoying a good online banking experience” (37%).

amazon
Corporate TaxTax

Amazon Is The Global Frontrunner In Research And Development

amazon

Amazon Is The Global Frontrunner In Research And Development

The latest research by R&D tax credit experts, RIFT Research and Development Ltd, has looked at which names are driving the R&D sector when it comes to spend on sector innovation around the world.  

RIFT looked at the total spend on research and development as well as what percentage of revenue this accounted for.

Top of the list is world-beaters, Amazon, although they remain largely involved in technology and retail as their core business. The US-based business behemoths not only have the retail game on lockdown, but they top the R&D table as well, with the latest figures showing a huge R&D spend of 17.38 billion pounds in a single year. The development of delivery drones must be expensive although it’s money well spent, with Amazon’s evolution ensuring that their giant R&D spend equates to just 13% of revenue!

Tech and software giants, Alphabet, the world’s fifth-largest technology company by revenue and one of the world’s most valuable companies, take the second spot in the R&D spend league table.  The parent company of Google, they spent £12.47bn in a year on research and development, although again, this equated to just 15% of revenue.

Volkswagen takes bronze as one of just three non-tech focused companies in the top 10 R&D spend league table. The German car manufacturer is also the first outside of the US with an R&D spend totaling £12.12bn over the last year.

Samsung (£11.77bn), Microsoft (£11.33bn), Huawei (£10.45bn), Intel (£10.07bn) and Apple (£8.90bn) rank fourth to eight as the tech takeover continues, while Swiss medical multinational Roche Holding, who operates worldwide under the two divisions of pharmaceuticals and diagnostics places ninth with £8.30bn spent on R&D.  

In at the tenth spot is Johnson and Johnson, again largely involved in pharmaceuticals and consumer packaged goods, with an R&D spend of £8.11bn.

Other companies to feature in the top 20 range from Daimler, Ford, Facebook, BMW and Bosch.

Director of RIFT Research and Development Limited, Sarah Collins commented:

“It goes without saying that some of the biggest names in the business will be spending considerable amounts of money on bettering their proposition through innovation, research, and development and those with the huge budgets to do so are also some with the lowest percentage of R&D spend as a percentage of revenue. 

While R&D certainly lends itself to a wider array of work in certain sectors, such as automotive, pharmaceuticals, engineering and software development, it certainly isn’t restricted to these sectors alone and it’s great to see so many vast and varied businesses taking advantage of R&D tax relief in the UK in particular. If you’re an SME pioneering change in your individual sector, make sure you are making the most of Government rewards for doing so and no matter how insignificant you think a step forward might be, the chances are it qualifies as research and development.”

Company

R&D spend $ (US billions)

R&D spend £ (GBP billions)

R&D Intensity (R&D to Revenue %)

Industry group / sector

Country / nationality

Amazon.com

22.62

17.38

13%

Retail / technology / services

United States

Alphabet

16.23

12.47

15%

Software and services

United States

Volkswagen

15.77

12.12

6%

Automobiles and components

Germany

Samsung

15.31

11.77

7%

Technology hardware

South Korea

Microsoft

14.74

11.33

13%

Software and services

United States

Huawei

13.6

10.45

15%

Technology

China

Intel

13.1

10.07

21%

Semiconductors

United States

Apple

11.58

8.90

5%

Technology hardware

United States

Roche Holding

10.8

8.30

19%

Pharmaceuticals / biotechnology / Life

Switzerland

Johnson & Johnson

10.55

8.11

14%

Pharmaceuticals / biotechnology

United States

Daimler

10.4

7.99

5%

Automobiles and components

Germany

Merck & Co

10.21

7.85

25%

Pharmaceuticals / biotechnology

United States

Toyota

10.02

7.70

4%

Automobiles and components

Japan

Novartis

8.51

6.54

17%

Pharmaceuticals / biotechnology

Switzerland

Ford Motor Company

8

6.15

5%

Automobiles and components

United States

Facebook

7.75

5.96

19%

Software and services

United States

Pfizer

7.66

5.89

15%

Pharmaceuticals / biotechnology

United States

BMW

7.33

5.63

6%

Automobiles and components

Germany

General Motors

7.3

5.61

5%

Automobiles and components

United States

Bosch

7.12

5.47

8%

Engineering / technology

Germany

Sources

IdeatoValue

Strategy&

 

 

 

 

Press releases

Wealth & Finance International 2019 Artificial Intelligence Awards

2019 Artificial Intel Awards Logo Long-01

United Kingdom, 2019- Wealth & Finance magazine has announced the winners of the 2019 Artificial Intelligence Awards.

Technology is the great driver of change across the breadth of the corporate landscape. Of course, the wealth management industry is no different, as artificial intelligence and machine learning have helped revolutionise a new era in the financial sphere.

As such, the 2019 Artificial Intelligence Awards have been launched to recognise and honour those firms and individuals who are at the very cutting edge of this technological development. From best in class software developers, to academics and experts of all varieties, this programme has sought to distinguish those who are working hard to define the very future of wealth.

Discussing the outcome of the programme, Steve Simpson, Awards Coordinator commented: “Artificial Intelligence remains a powerful and potent tool for wealth managers and professionals working in the financial industries. The Artificial Intelligence Awards were created to showcase the firms that are making extraordinary strides in the arena, and look set to redefine and hone best practices. Congratulations to everyone, and I wish you all the best for the future.”

To learn more about our deserving award winners and to gain insight into the working practices of the “best of the best” in AI, please visit the Wealth & Finance website https://www.wealthandfinance-news.com/awards/artificial-intelligence-awards-2019/) where you can access the winners supplement.

ENDS

Notes to editors.

About Wealth & Finance International

Wealth & Finance International is a quarterly publication dedicated to delivering high quality informative and up-to-the-minute global business content. It is published by AI Global Media Ltd, a publishing house that has reinvigorated corporate finance news and reporting.

Developed by a highly skilled team of writers, editors, business insiders and regional industry experts, Wealth & Finance International reports from every corner of the globe to give readers the inside track on the need-to-know news and issues affecting banking, finance, regulation, risk and wealth management in their region.

aspen
BankingFamily OfficesPrivate Banking

Emotional Economics: The Challenges of Mixing Love and Money in Family Businesses and Legacy Families

aspen

Emotional Economics: The Challenges of Mixing Love and Money in Family Businesses and Legacy Families

Thirty years ago, the family business started by Daniel’s grandfather and great uncle was sold. Daniel and his three siblings received nearly sixty million US dollars each, as did each of their cousins. In 2016, Daniel, who had created a successful real estate and development business and on the advice of his financial and tax advisors, transferred to his four adult children twenty-five million US dollars each. The age range for the adult children spanned nine years, and one daughter worked in Daniel’s business. From the day gifting was announced it has resulted in family disruption. The surface discord resulted from a perceived economic injustice concerning “the time value of money” since all siblings received an equal share rather than a share based on their age. But the deeper disharmony stemmed from an unresolved historical emotional impasse between the father and one of the adult children dating back to the child’s teenage years. 

As Aspen Consulting Team, (ACT) we help members in family businesses and legacy families address the psychological dynamics of love and money, the interplay between emotions and economics, in the family system. 

Love and money are symbiotic and immiscible. They are connected, but do not mix naturally. The wrong mixture results in entitlement, disruption, and conflict; the correct mixture results in gratitude, opportunity, and resilience. The wealth connection in a family business and/or legacy family requires
Emotional Economics: The Challenges of Mixing Love and Money in Family Businesses and Legacy FamiliesMar19081
adult children to stay integrated in their family of origin much longer than typical families. The financial interdependence provides great benefits and at the same time creates complexities. A basic operating principle in our work is that the deeper the economic interconnections the higher the potentiality for emotional conflicts.

Every family business and/or legacy family is a system, a combination of small subset systems (individuals) connected to mid-size systems (family units), nested within larger systems (extended and generational family units), and linked to much larger systems (business and wealth management). Everything is connected and influenced by everything else. Within this system transitioning wealth takes place at two levels where the highest goal is to provide an inheritance without creating entitlement. 

• The “external” work is wealth creation and management. The task of continuing the vision set by the founders, operating with the values that made the family successful in the first place, protecting assets, defining financial goals, policies, and strategies, adjusting to taxes and market changes, understanding investments and ROI, implementing shareholder agreements and distributions, creating foundations and estates, and increasing the financial portfolio. Legal and financial advisors help with this work.
• The “internal” work is relationship harmony and management. The task of connecting and inspiring family members, strengthening the family culture, adapting to generational values, maintaining agreements, managing interpersonal stress, working as a team, responding to special demands, and enjoying the process as members of each generation face opportunities and transitions. This is the space in which ACT works.

There are always two parallel objectives in our work. The first objective is to create guidelines to “prevent the emotional tail from wagging the economic dog.” The second objective is to “not cut off the emotional tail.” Emotions, when accessed correctly, are powerful guides and cannot be ignored without damaging relationship harmony and overlooking important decision-making data. There are more emotions in an economic experience than meets the mind’s eye.

Emotions are actions, many of them are public and visible to others as they are expressed in body language or are verbalized. Feelings, on the other hand, are always hidden, unseen and perhaps unrecognized, to anyone other than their rightful owner. Feelings are the most private property we own. Emotions precede feelings, much to the common mistaken view. “We have emotions first and feelings after because evolution came up with emotions first and feelings later.”2 We, and our emotional system, are designed to solve the basic problem of how to continue life by being either competitive or cooperative and on the economic survival level this involves money. 

A study conducted with children, ages 3 to 6 years, showed that they did not understand the economic value of money, but they comprehended its emotional value. The first group sorted coins and banknotes, while the second group sorted buttons and candy. The children who worked with money demonstrated an increase in egotistical behaviors, were less eager to help the researchers, corralled more awards for themselves, were less likely to share their rewards with the other children, but were more persistent in completing individual tasks. Handling money reduced feelings of helpfulness and generosity while increasing perseverance and effort. These results are very similar to the results of a comparable study that looked at adult behavior. According to Agata Gąsiorowska, economic psychologist and a coauthor of the study:3

“Money is such a strong symbol in the world based on economic exchange that even small children are influenced by its significance. Money causes people to switch from the view of the world that values close relationships to the world that values market exchange, where the notions of ‘me’ and ‘my gain’ are in the center.”

Emotions, often considered “gut feelings” or conscious experience, really involve many systems
within our brain. Emotions create a burst of activity devoted to one thing, survival. Emotions trump non-emotional events, like thought, reason, and decision-making, even in the most rational analyst and business leader, because they are older in the human developmental process than economics. Emotions kept our ancestors alive long enough to create and give us an inheritance. Emotions, even those in our memory system, trigger certain features, feelings, and stimuli that are designed for homeostasis. 

Homeostasis is a self-regulating process by which our biological and psychological systems try to maintain stability while adjusting to conditions that are optimal for survival and success. In love and war, as in family and business, when homeostasis is successful, individual and collective life continues and flourishes. There are “natural triggers” like the sight, sound, and smell of a predator and “learned triggers” like the sight, sound, and smell of money that aid us in the pursuit for homeostasis.4

About 10,000 years ago, when the first farmer created more than his or her family could consume, the economy of the marketplace began. Before the agricultural age, our ancestors were daily hunters and gatherers, collecting and consuming without the ability or surplus to “store up” resources. When farmers took their extra bags of gain to the marketplace they needed a symbol of exchange. In time, this symbol became money. 

From that time forward, there are few interactions or decisions in a legacy family that do not involve money and a drive for the family to flourish. The recent college admission scandal in the United States is a brazen example. 

Money is an emotional trigger in families and how we react to it may be either positive or negative. In order to have a positive environment, family leaders must work toward stability between two social systems that continuously change as individuals change. The two social systems are the homogeneous system of being similar, the drive for family unity, and the heterogeneous system of being dissimilar, the drive for personal autonomy. These systems create interpersonal tension and ambiguity, along with creativity and drive that must be anticipated and proactively managed in a legacy family and family business. Wishing that anxiety or conflict would depart the family system or that love and harmony would show up is usually not enough. 

The tension among family members is from four psychological positions; Fight, Flight, Freeze and Flow . Three positions, Fight, Flight, and Freeze , are an extension of our evolutionary survival system. The fourth area, Flow, is the way to happiness and success.5 It requires psychological awareness, behavioral adjustment, and positive action on the part of family members and leaders and is difficult to create and maintain as family members grow and change.

• Fight: When both personal confidence (autonomy) and relationship security (unity) are low, one’s psychological position is hostile-dependent. This shows itself in behaviors of “moving against” others in the family or family system. The feelings and behaviors expressed are often confusion, anger, resistance, and opposition.

• Freeze: When personal confidence (autonomy) is low and relationship security (unity) is high, one’s psychological position is co-dependent. This shows itself in behaviors of “moving in” with others in the family or family system. What we often see is enmeshment, clinginess, entanglement, low selfesteem, fear, and anxiety.

• Flight: When personal confidence (autonomy) is high and relationship security (unity) is low, one’s psychological position is counter-dependent. This shows itself in behaviors of “moving away” from others in the family and/or family system. This is seen in acts of isolation and detachment, which can look like independence, if it were not for the financial dependence. 

• Flow: When both personal confidence (autonomy) and relationship security (unity) are high, one’s psychological position is inter-dependent. This shows itself in behaviors of “moving with” others in the family and/or family system. This is experienced as cooperation, maturity, accountability, and resilience. This, of course, is the most optimal position for family members.

For economic success and relationship harmony within a legacy family or family business, family members must purposefully address emotional historical impasses, resolve sibling rivalries, find comparable values, and work toward mutual goals. The psychological tools for doing this work are what we have termed “thick trust” and “mature adult communication.” 

Long-term success in family and business life requires a willingness to trust one another. The question is how we measure the trust. Scientific research shows that most people’s accuracy in discerning if another person can be trusted is imprecise. Much of the time, we have weak or no guidelines other than a set of emotional clues we have used in the past. Trust is dynamic—not static. The more we have at risk, the greater the need for trust. It is helpful to think of trust in three levels.6

1. One-Way Trust. Only one person has trust on the line. If the other person cannot be trusted to follow through on promises or commitments the relationship ends, as do any potential gains or losses. 

2. Mutual Trust. This is a reciprocity style, often called quid pro quo and “tit for tat,” for regulating equilibrium in transactional relationships. It is the most familiar type of trust in business, worked out among and between the same parties over a long period of time. Both parties play the roles of giver, taker and matcher, and exchange these roles for mutual benefit. When trust is broken, the relationships and transactions end.
3. Thick Trust. This is the highest form of trust and is required for family members to work together for the long-term. Family business relationships are complex because they occur across different settings and include a diverse series of interactions, both personal and professional. Action at one level may have ramifications at other levels, and every action has the potential for benefit or harm. Trust at this level, like in a marriage, requires the strength, resilience, and skill of mature character to overcome and forgive mistakes. 

Trust and trustworthiness are forms of social and relationship capital. A subjective way to think about your trustworthiness or that of another person in a family business is the following formula. Personal Character plus Competency Skills divided by Self-Interest plus Psychological Awareness plus Behavioral Adjustment determines Thick Trust.  

TT=[(PC+CS)÷SI]+(PA+BA)

A solid foundation of trust allows communication to be clear, constructive, and proactive, what we call Mature Adult Communication (MAC). We suggest that family members have a formal agreement to use MAC when important economic and emotional decisions need to be made. The first step in MAC is to clearly define the issue. Much of what is called “failure to communicate” is not having a clear and collective understanding of the problem or issue. The second step is to explore all the psychological dynamics, emotions, and feelings around the issue. This is often the hardest step and may require outside consultation. The third step is to have full commitment by all family members involved in the issue to the decision-making process (who, how, and when a decision will be made) and to make a clear and firm decision, with an evaluation process if necessary.

MAC eliminates what statistician and author Nassim Taleb calls narrative fallacy, “ a wrong ruler will not measure the height of a child. ”7 This is how we fool others and ourselves by a flaw in a story of the past, often emotional, which shape our decisions for the future. An accurate diagnosis of the problem sets the stage for the correct treatment. Decisions that address the wrong description of the situation can be made with a high level of determination, confidence, and authority, but will still be defective and require correction at a later time with greater expense. 

Creating, managing, and transitioning wealth within a family is a balancing act. It requires addressing the struggles not only among and between individual family members, but the tension created by money. The connections from our emotional system to our cognitive system are stronger than the connections from our cognitive systems to our emotional system. If this were not true, Daniel’s adult children would not have entered into the discord that has alienated and estranged family members.

aspen
Thomas Edward Pyles, MA & Edgell Franklin Pyles, PhD

Edgell and Tom, a father and son team, consult with family businesses on leadership strategies, particularly succession, and with legacy families on the complexities of mixing love and money. They are the co-authors of MAPS for Men: A Guide for Fathers and Sons and Family Businesses. Fourth generation business owner Charles S. Luck, IV, wrote, “MAPS for Men is one of the most comprehensive guides to families in business that I have ever seen.”

“Edgell and Tom weave a tapestry of insight for anyone seriously interested in building family relationship bridges that endure generational transitions.” Dennis Carruth, President, Carruth Properties Company. 

“I have clearly seen results. In all cases it is an inflection point to a fresh and positive perspective.” Chris Branscum, Family Office Advisor, JD, CPA.

“I have worked with Edgell for more than twenty-five years. He has provided counsel to our family, including our two adult sons, my business, and my YPO group.” James Light, Chairman, Chaffin Light Management Company. 

“Our family legacy is now in the fifth generation. I truly appreciated Edgell and Tom’s work. The lessons learned will bear fruit for many years and generations to come.” David Hardie, Founder and CEO, Hallador Management, LLC.

“The psychological and spiritual counsel offered by Edgell and Tom has proved very helpful to my family and business.” Jeff Wandell, Founder and CEO, Prairie Gardens and Jeffrey Alan’s. 

“Dr. Edgell came into my life in a time when I had failed and did not like myself in many ways. He helped me, at the age of 58, on a new journey of bliss.” M. Ray Thomasson, PhD, President, Thomasson Partner Associates, Past President, American Association of Petroleum Geologist, Past President, American Geological Institute.

“Edgell enriches lives of those he touches in a most profound way.” Paul Schorr, Past President, Chief Executives Organization.

Sources:

1. Erik Erickson, Identity, Youth, and Crisis.

2. Antonio Damasio, Looking for Spinoza: Joy, Sorrow and the Feeling Brain.

3. The study was conducted by an international research team, including: Agata Gąsiorowska, Tomasz Zaleśkiewicz, and Sandra Wygrab, SWPS University in Wrocław, Lan Nguyen Chaplin, University of Illinois, and Kathleen D. Vohs, University of Minnesota.

4. Joseph LeDoux, The Emotional Brain, The Mysterious Underpinnings of Emotional Life.

5. Mihaly Csikszentmihalyi, Flow, The Psychology of Optimal Experience.

6. Elinor Ostrom and James Walker, editors, Trust & Reciprocity, Interdisciplinary Lessons from Experimental Research.

7. Nassim Taleb, “A Map and Simple Heuristic to Detect Fragility, Antifragility, and Model Error.”

vineyards
RegulationTax

What Do Sex Toys, Architects and Vineyards Have In Common?

vineyards

What Do Sex Toys, Architects and Vineyards Have In Common?

They are all sectors that could be claiming for Research and Development Tax Credit, according to R&D specialists RIFT Research and Development Ltd.

While growth in R&D tax relief claims has increased by 35% annually since inception in 2001 to over £4bn last year and has already returned £26bn in total tax relief to businesses across the nation, the scheme is yet to be fully utilised.

Introduced by the Government, it encourages scientific and technological innovation across a plethora of UK business sectors. But while RIFT has worked with some of the more traditional companies to have made the most of it, in areas like construction, manufacturing, business and finance, they believe many are still failing to take advantage of the financial benefits and have highlighted some of the more unusual work that could qualify. 

Architecture

Architects are often presented with issues when planning whether it be social or environmental and the engineering or technology-based advancements made to overcome these can often qualify as R&D. 

Some examples of architectural practices that may fall within the R&D framework include designing bespoke features, testing and prototyping, improving energy efficiency, adapting practices when working on heritage or listed structures, tackling acoustic issues, new thermal or lighting requirements and seeking BREEAM, Passivhaus or LEED certification.  

Catering

Catering is home to a whole host of R&D opportunities including work that makes innovative use of the effects of preservatives, increases a product’s nutritional value, helps increase the shelf life of a product, changes the flavour of an existing product, or even the texture or form. For example, advancements in liquid-based breakfast items.

This also includes work on reducing allergens and additives or even the processes, techniques, equipment and ingredients used, whether it be a commercial kitchen or an industrial food production unit or factory. One recent area where plenty of work would qualify is the production of gluten-free food and developing this offering across a wide variety of products that weren’t available before.

Car Manufacturer and Dealers

At times, nontechnical activities can qualify, including areas such as the design of a car’s shape should the manufacturer be able to demonstrate advancements in aerodynamics, performance or fuel consumption. 

Even the more day to day tasks of re-designing your showroom CRM system to make the day to day running of your site more efficient can qualify.  

Clean Tech

Clean tech is perfect for R&D Tax Relief and if you aren’t claiming you’re missing out. But you don’t have to be designing carbon-neutral products in a lab, even driving innovations in areas such as recycling, renewable energy, solid waste management, or sewage treatment could see you qualify.

Textiles

Textiles is another sector rife with opportunity, driven by design and creation but also heavily reliant on production methods, the way you bring a design to life and the efficiency of the machines used to produce the fabric could all qualify for R&D if you’re doing something new to pioneer efficiency and reduce waste.

Sex Toys

Believe it or not, the sex industry is consistently producing pioneering work that would easily qualify under the R&D tax relief framework. Whether it is a new technology, stimulation technique, material or even the way these products are made, any and all new advancements tend to be leading innovation in the sector. 

Football Clubs

Yes, football clubs. Largely due to the advancements being made within the performance departments on a medical basis. This can include nutritional plans, rehabilitation methods and activities, research and information into specific injuries, all of which can help reduce the time a player is unable to play and the speed and the quality of their recovery. 

Vineyards, Breweries and Distilleries

Increasing output while maintaining standards and costs has seen many companies producing wine, beer or spirits carry out R&D-worthy work. Again, removing additives or preservatives can advance a product, or by increasing alcohol content, creating new processes to help scale up productivity or even experimenting with new materials to develop unique flavours for sale to the industry.


Director of RIFT Research and Development Limited, Sarah Collins commented:
 

“Research and development is happening in every corner of British business but many are failing to recognise that the work they are doing qualifies. We’ve highlighted just a few of the more unusual, but if you’re doing something different to advance your business or product, why not get all the help you can and claim some financial relief on the costs incurred to develop these advancements.”  

marketing
ArticlesFunds

Aligning Marketing and Sales

marketing

Aligning Marketing and Sales

Geoff Webb, VP of Strategy at PROS.

It might surprise you to hear that in many financial services organisations, the CMO (Chief Marketing Officer) often has the biggest IT budget. The reason is relatively straight-forward: in recent years there has been an immense investment in MarTech, and it’s made the discipline of marketing very tech-heavy. So much so in fact, that marketing departments now spend more time staring at dashboards, spreadsheets, and AI-fueled analytics than almost any other part of the business.

In fact, this trend is accelerating. Gartner research into CMO budget spend in 2018 revealed that as many as 57 percent of CEOs are prepared to invest more in marketing.

Yet, while this huge focus on technology has armed CMOs with an incredible level of insight (including where your mouse goes on their site, what kinds of content you read online, and so on), it has also resulted in a rather one-sided technology investment, especially for B2B financial services firms who are eager to demonstrate to their customers that they both understand and care about them as individuals.  

We think it’s time for perception surrounding ownership of the technology budget to change. While marketing departments may be happily sailing on an ocean of usable data, their colleagues in the sales department may be struggling to respond to an explosive change in buyer behavior and expectations.

The reality is that today’s CRO’s (Chief Revenue Officers) are facing extraordinary pressure to transform their departments – especially in the face of a growing shift towards digital commerce models. Once upon a time, a sales executive could rely on experience, insight, and interpersonal skills to close a deal and keep the customer buying – but today, that’s a much more difficult task.


Evolving with your sales team

An increasing number of buyers are now moving away from the traditional model of calling up their sales rep and asking for a quote. Instead, they’re seeking the convenience of being able to buy online, without needing to pick up the phone, send an email, or – heaven forbid – meet in person. Simply put, for the day-to-day business of buying, purchasers want the speed and convenience of e-commerce. Yet studies also show that buyers want to know there will be a well-informed sales executive available at the end of the phone, should they need one.

Managing this shift from meeting in person to being mostly offline/sometimes in person isn’t easy, and requires sales professionals to be fully informed about their customers, have visibility into transactions as they’re occurring (should the customer need help) and be ready to provide insight and guidance.

The solution to supporting this change for the sales team lies – just as it did for the marketing team – in the deployment of technology. In the same way that MarTech has transformed marketing teams, sales departments need to adopt highly specialised technology that can help them to be more personalised, faster, more efficient, and ultimately capitalise on the increased number of leads.

When we look at where much of the investment in sales automation technology is currently, we see it at the operational level. As is stands, sales professionals can spend as little as 36 percent of their time actually selling, meaning they are dwindling away precious time and productivity on administrative tasks. However, there is a deeper need to be met for sales leadership, a more fundamental question as we shift towards more complex, multi-channel digital selling – how do I make my sales people not only more productive, but more informed?


Getting personal

We’re now seeing the emergence of several next-generation sales technologies that are able to go beyond operational efficiency and provide the same degree of analytic-based insight to CROs that marketing technology provides to CMOs.

Top of the list are technologies that can enable more intelligent quoting for complex products (where configuration can be highly time-consuming and prone to expensive errors), and some good examples of this are products like heavy equipment or high-tech medical devices.

Arming sales executives with the tools they need in order to support these kinds of purchases, replete with information not only about the product, but about the specific needs of that customer, can slash the time needed to respond correctly to a request. Studies show that delivering highly personalised responses to buyers not only increases win rates, but also increases the value of the sale. Customers are much more likely to pay additional for something if they know that the product being offered is personalised to them and designed with their specific needs in mind. This includes the product itself, how it’s packaged, how it’s delivered and how it’s priced.

Driving the bottom line together

Yet, all these changes are indicative of a more profound change that looms on the horizon for financial services firms.

Aligning marketing and sales has long been a challenge that has vexed the c-suite. At their heart, misalignments often arise from a lack of common understanding regarding the nature of their customers and the market needs. And these misalignments are expensive and disruptive, wasting time, effort, and opening cracks in customer satisfaction that agile competitors can exploit to steal market share.

But what if sales and marketing had a common, clear, and consistent understanding of their customers and their needs? What if, instead of arguing about messaging and focus, sales and marketing teams were completely aligned?

One of the keys to achieving this will be sharing the same big data lake and analytic/AI engine to give rise to a unified and common sense of the who, where, what, and how of customer engagement. This changes everything – because now the entire business becomes a single, focused unified force to deliver precisely what the customer needs, every day, with every interaction.

It might seem ironic that technologies such as big data, cloud platforms and AI will serve to transform the most ‘human’ aspects of financial services sales and marketing, yet this is exactly what’s starting to happen. What’s more, freed of disruptive disagreements about what customers want, businesses can finally start to align all their energy into delivering a customer experience that sets them apart.

So, while the CMO might be getting the lion’s share of the tech budget today, we expect to see more sharing with other teams to happen in future. Of course, adopting this more hybrid sales model might bring cultural, organisational, and even revenue implications with it, but the rewards on offer couldn’t be clearer.

offshore
BankingCash ManagementOffshore

5 Reasons Why You Need To Bank Offshore

offshore

5 Reasons Why You Need To Bank Offshore

Offshore banking is often associated with negative connotations in regard to tax evasion and criminal activity, but this couldn’t be further than the truth. Despite what you may hear, offshore banking is completely legal. Put simply, they’re bank accounts held in a country other than the one you permanently reside in.

So why do you need one? James Turner, Director at York-based Turner Little, takes us through the benefits of banking offshore.

They’re not just for the ultra-wealthy

A common misconception is that offshore banks are just for ultra-high net worth individuals, who want to hide their money. Anyone can benefit from using an offshore bank account, depending on what their needs are. At Turner Little, we work with our clients to specifically identify their needs, and tailor our solutions based on our extensive experience and understanding of the banking industry.

They’re safe

Offshore banks are often considered to be politically and economically stable, with any associated risk considerably reduced. Using an offshore bank, based in a highly regulated, transparent jurisdiction that offers individuals an element of protection with a deposit compensation scheme, enables you to feel safe in the understanding that your wealth will be protected from the risks of capital accessibility restrictions, control and potential currency devaluation.

 
They provide flexibility and control

Banking offshore is completely flexible, often offering the same high level of service you would expect with traditional, onshore banking. It has always been a successful way of ensuring you maintain control over your long-term finances, which ultimately means you have greater freedom without depending on any one country. This convenience and flexibility is especially relevant for those who travel regularly, or have international assets.

You’ll always have easy access

Offshore banks have evolved over the last decade, and offer 24/7 online banking. This means that no matter where you are, you’ll always have easy access to your funds. Depending on which bank you choose, you’ll also have access to accounts in multiple currencies, allowing you to manage accounts and automate payments whenever you need.

You’ll be able to build on your investment portfolio

Many countries offer tax incentives for foreign investments and provide you with a wide choice of both funds and investments. There is no shortage of opportunities that are fiscally sound, designed to promote a healthy investment environment and, most importantly, legal.

m bills
BankingWealth Management

Slovenian mBills Pioneering with the Next Step in Mobile ePayments

m bills

Slovenian mBills Pioneering with the Next Step in Mobile ePayments

Innovation in the Fintech space can come in many forms. Whilst the idea of seamless mobile payments is far from a novel one, with many firms around the world moving to capitalise on a growing demand for accessible financial services, mBills mobile wallet has swiftly differentiated itself in the Slovenian market. Eager to find out more, we spoke to CEO, Primož Zupan to find out more about their expertise and services.

Fintech, long associated with swift moving developments and a certain innovative spark, has been the great driver of change in a comparatively sluggish market. Where brick and mortar giants have been slow to adapt, leaner more proactive entities have seen exceptional success through an ability to cater – intrinsically – to ever-changing consumer behaviour. This is where mBills have secured their success.

Indeed since 2015, mBills has been providing cutting edge solutions in the e-payment space. Through utilising mobile smartphone technology, they have, essentially, put the consumer at the centre of every transaction – giving them back control of their finances. This is especially important when considering the market that mBills primarily operates in – Slovenia. As Primož discusses, the novelty of mBills services helped them to quickly forge an impressive reputation in the industry, “mBills was the first mobile app on Slovene market to introduce mobile wallet solutions to its users and has since than implemented and significantly expended variety of solutions, constantly keeping the user and the best possible user experience in the centre of development.

“The vision of mBills is to give the user a complete control and overview of finances, so that paying, purchasing or ordering financial products will be at the user’s fingertips in one app, regardless of the bank, communications provider or operating system.” This user-centric ethos has resulted in mBills experiencing a burgeoning client base of consumers eager to make use of the company’s ‘next-generation’ approach to financial services – as Primož continues. “Our user database is steadily growing, and we have received huge positive feedback from both users and thought leaders of the industry. The ultimate vision of mBills is to give the user a complete control and overview of finances, so that paying, purchasing or ordering financial products will be at the user’s fingertips in one app, regardless of the bank, communications provider or operating system.”

“mBills mobile wallet is available to everyone and at any time – whatever the bank, operating system and mobile operator.”

Through their ‘all in one’ app, users can make quick and easy point of sale payments, pay monthly invoices, and manage their e-wallet, ensuring that budgets are followed, and finances are maintained. Moreover, through their partnerships with cash programs such as mintPOS, VASCO and microGRAMM, mBills has ensured their longevity for the years to come.

“As a fintech start-up MBILLS is basically run by a team of enthusiastic individuals who put their heart and soul in the product. We all share the same vision and complement each other to reach it faster, therefore staying ahead of the competition.”

All in all, mBills is a firm with the future firmly in mind. Even among the competitively crowded ePayment landscape, they have distanced themselves from the competition by prioritising the user experience. It’s a mindset that has proved to be the key to the firm’s enduring success and looks set to secure their longevity in the years to come.

Specifically, for Primož, the future sits with development of the app’s integration and features: “We plan to expend the variety of features in the app that will further cater to the needs of our users – making mBills the only application you need on your phone for keeping a track on your finances, enabling savings, donations, ordering financial products, supporting different loyalty programs, purchasing etc. Ultimately, we aim to fulfil our promise to become a ‘digital solutions’ provider. These multiple in-app solutions will simplify user’s everyday life. The future of mBills looks very exciting .”

offshore banking
BankingOffshoreWealth Management

Offshore Banking: Breaking The Taboo

offshore banking

Offshore Banking: Breaking The Taboo

It’s not what you think. Offshore banking is often slandered, and most commonly associated with tax evasion. But this begs to question – what do people really know about offshore banking? James Turner, Director at York-based Turner Little tells us everything we need to know about offshore banking.

“Offshore banking, simply put, is banking done in a country other than the one you live in. That’s it. It doesn’t mean tax evasion, it doesn’t mean hiding money, it doesn’t mean fraud, it’s perfectly legal – and convenient.

“There are both financial and legal advantages to banking offshore. At Turner Little, we recommend clients consider the why, before they consider the where. Banks in certain countries tend to be less stable, whilst other offshore jurisdictions are incredibly stable and provide easy account set-up and access online.

“One clear benefit is having access to a multi-currency account. If you have international financial obligations, the ability to transfer money between currencies is a relatively fast and painless experience, with some offshore banks able to provide competitive rates in comparison to regular banking services.

“Depending on the bank you choose, offshore banks can act as a private banking facility, where lending and credit facilities can be more flexible and tailored specifically to your needs. A good offshore bank will also be able to provide you with a wide array of funds and investments that are appropriate to your risk profile and the outcomes you want to achieve.

“Offshore banking is also one way you can ensure your financial information is kept private. It’s also a way in which you can protect your assets against financial instability. Offshore banking works if you use it correctly, and if all the documentation is correct – this is where we come in. At Turner Little, we familiarise ourselves with the regulations necessary for compliance in a multitude of offshore jurisdictions – so you don’t have to. When the rules are followed, offshore banking is legal and gives you the means to better protect your assets, providing you with both financial strength and freedom.”