Month: July 2020

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Press releases

Wealth & Finance Magazine Announces the Winners of the 2020 FinTech Awards

wf press release header
Wealth & Finance Magazine Announces the Winners of the 2020 FinTech Awards

United Kingdom, 2020- Wealth & Finance magazine have announced the winners of the 2020 FinTech Awards.

FinTech is an ever-evolving – and fast-moving – industry, defined primarily by constant innovation and creativity. Whilst ‘disruption’ has almost been reduced to an oft-stated buzzword, it would be fair to describe the FinTech industry as such. After all, the financial landscape is dominated by long-standing brick and mortar establishment, and new ground is ripe for the taking for those with the expertise, experience and drive to take it.

Now in its fourth year, Wealth & Finance magazine’s FinTech Awards was launched to recognise the firms that are redefining finance and banking for the modern age, and for the modern consumer.  

At launch, Awards Coordinator Chloe Smart commented: “I offer a sincere congratulations to all of the winners of this year’s programme. It has been wonderful to correspond with you all, and I hope you have a fantastic rest of the year ahead.”

To learn more about our deserving award winners and to gain insight into the working practices of the “best of the best”, please visit the Wealth & Finance website where you can access the winners supplement.

ENDS

Note 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.

Martin Lewis
ArticlesBankingCash Management

Martin Lewis Financial Education Textbook Rolled Out to 700 Schools Across the UK

Martin Lewis
Photo credit: The Money Saving Expert 

Martin Lewis Financial Education Textbook Rolled Out to 700 Schools Across the UK

The first ever financial education textbook to hit Northern Ireland, Scotland and Wales will be rolled out over the next 15 months.

This week, Young Money announced the launch of the first ever financial education textbook to hit schools in Northern Ireland, Scotland and Wales. Over 45,000 books will be sent free to schools over the next 14 months, as well as an accompanying teacher’s guide (available digitally). The textbook will also be available as a free PDF download to anyone who wants it.

This launch follows the successful roll-out of the textbook in England. In November 2018 340,000 copies of the very first financial education textbook in the UK, ‘Your Money Matters’, were delivered into English secondary schools. This was funded by Martin Lewis, the Money Saving Expert, with a personal donation of £325,000 to the financial education charity Young Money to develop and distribute this milestone resource and accompanying teacher’s guide.

Aimed at supporting the financial capability of those aged 15 to 16, the reality is that the textbook has been used across multiple year groups and within a wide range of subject areas.

Since being delivered into every state-funded secondary school in England, the Money and Pensions Service funded an evaluation of the impact that Your Money Matters has had:

• 89% of teachers said that Your Money Matters would improve the quality of financial education in their schools.

• 88% of teachers said the textbook would increase their confidence to deliver financial education.

Subject Head at a Community school, said:

‘Excellent resource! Much needed for youngsters. We are very grateful to have received the textbooks and received excellent feedback from students. One student told me that our Financial Capability lessons changed the way her parents look at finances and motivated them to change the way they deal with money as a family.’

A Year 12 student, commented:

‘It’s so broad as well – if you want a general outline it is perfect for that. I actually brought one home so I could look through the university stuff. My older brother wanted to know about a work pension… I said ‘I have this textbook’ so he looked at that. He found it useful – it had the general information that he needed.’

Following the success that Your Money Matters has received in England, the Money and Pensions Service and Martin Lewis are splitting the cost of the £368,000 project, funding Young Money to develop versions of the textbook for Northern Ireland, Scotland and Wales. State-funded secondary schools in each nation will receive both printed and digital copies of their textbook over the next 14 months:

Northern Ireland – January 2021 (12,000 copies in total)

Scotland – March 2021 (21,500 copies in total)

Wales – September 2021 (12,500 copies in total)

What is in the textbook?

The educational textbook contains facts and information as well as interactive activities and questions for the students to apply their knowledge. The chapters are as follows:

1. Savings – ways to save, interest, money and mental health
2. Making the most of your money – budgeting, keeping track of your budget, ways to pay, value for money, spending
3. Borrowing – debt, APR, borrowing products, unmanageable debt
4. After school, the world of work  student finance, apprenticeships, earnings, tax, pensions, benefits
5. Risk and reward – investments, gambling, insurance
6. Security and fraud – identify theft, online fraud, money mules

Whilst the key financial topics will remain largely the same, a review in each nation, consisting of focus groups with teachers and devolved government representatives for education, is being conducted to identify the amendments required. This will ensure that the textbook in each nation maps to the respective education curriculum as well as taking into account the specific needs and financial legislation in each country.

Once complete, up to 75 copies will be delivered for free into every secondary school in each nation.

Why do we need the textbook?

Financial education is part of the national curriculum for every nation in the UK. Whilst integrated into each curriculum in different ways, it is an important part of secondary school education. Various pieces of research have identified that teachers’ confidence in delivering financial education is relatively low – there is little training provided to support this – and the degree to which young people receive financial education in school is hugely variable.

The textbook addresses this by covering key financial information in a relevant and engaging way for students. To accompany the textbook there will be an online teacher’s guide which will support teachers in each nation to use the textbook to enrich their own financial education provision in a variety of ways.

There is a strong need to help young people understand financial matters. For example, fewer than three in ten 14 to 17-year-olds plan ahead for how they’ll buy things they need, and one in ten 16 to 17-year-olds have no bank account at all. Gaining knowledge and confidence in financial issues is crucial to leading to better decisions now and in later life.


Martin Lewis, founder of MoneySavingExpert (though donating in a personal capacity) comments
:

“The pandemic has shown the lack of personal financial resilience and preparedness of the UK as a whole. Not all of that can be fixed by improving financial education, but a chunk of it can. Of course, we need to educate people of all ages, yet young people are professionals at learning, so if you want to break the cycle of debt and bad decisions, they’re the best place to start.

I was one of those at the forefront of the campaign to get financial education on the national curriculum in 2014, and we celebrated then thinking the job was done. We were wrong. Schools have struggled with resources and there’s been little teacher training. Something else was needed to make it easy for schools and teachers. So even though I questioned whether it’s right that a private individual should fund a textbook, no one else would do it, so I put pragmatics over politics and did it in 2018.

I’m delighted that now we’ve proved the success of that book in England. The Money and Pensions Service has agreed to team up to provide this much-needed resource for the rest of the UK’s nations – adding a rightful sense of officialdom to the whole project.”


Sharon Davies, CEO at Young Money and Young Enterprise comments
:

“We are thrilled that Young Money is able to develop the Your Money Matters textbook for every UK nation. Financial education is critically important for all young people, and it is fantastic that the difference this has already made within England can now be extended to Northern Ireland, Scotland and Wales. We look forward to working with our partners in each of these nations over the next year.”

Sarah Porretta, Strategy and Insights Director at the Money and Pensions Service comments:

“We know that learning about money when we’re young can have a direct impact on the ability to manage money later in life. However, too many young people are entering adulthood without being prepared for the money-related challenges that lie ahead.

The launch of the Your Money Matters textbook in Northern Ireland, Wales and Scotland is a vital step towards more teachers having the confidence, skills and knowledge to teach financial education. As part of our UK Strategy for Financial Wellbeing, we want to see a further 2 million children and young people getting a meaningful financial education so that they become adults able to make the most of their money and pensions.”

millennials
ArticlesBankingCash Management

How Millennials Can Get Ahead With Their Money

millennials

How Millennials Can Get Ahead With Their Money

Millennials are often painted as globe-trotting creatures that spend more money on avocadoes than their future. But that can’t be further from the truth. Millennials tend to be good savers, at least compared to other generations. Industry data shows that more than 70% of millennials have started putting money away for retirement and beyond.

“Millennials still struggle with investing. Often because they feel they don’t know enough about the market, but it’s never too late to invest in your understanding. It’s a great way to make your finances work harder for you,” says Granville Turner, Director at company formation specialists, Turner Little.

Here are some things you can start doing now, or preparing for, to set yourself up for a future of learning and investing:

 

Start early

The most apparent advantage millennials have over older generations is the luxury of time. Whilst everyone can weigh up the risks and rewards of investing, you’re particularly well-placed to see a solid return on your investments.

 

Challenge risk

When you invest money for longer, you can become less phased by the ups and downs and be able to view inevitable declines as opportunity instead. It’s better to look at yearly or even longer figures for a more accurate reflection of performance.

 

Put your money to work

Money that sits in a savings account, uninvested, is almost certain to lose value over time due to inflation, or a creeping higher cost of goods and services. If your money is growing or earning you a return, it’s going to help you reach your financial goals faster.

 

Start small

Many millennials believe you need to have a serious amount of money to start investing. But in reality, even small contributions can build over time. The important thing is to start early, and make it a habit.

If you’re ready to start having the right conversations about the future of your finances, get in touch with us today. With years of knowledge and expertise, we’ll be able to assist with any enquiries, no matter how complex.

UK credit score
ArticlesBankingCash ManagementWealth Management

Mapped: The UK’s Highest and Lowest Credit Score Hotspots

UK credit score

Mapped: The UK’s Highest and Lowest Credit Score Hotspots

The south is home to eight of the top ten areas with the highest credit scores in the country according to new analysis by Share to Buy.

Using the latest data from two major credit agencies, Share to Buy have mapped out the UK’s average credit scores by county showing where the country’s best scorers live, and who currently tops the national average of 570.

According to Google search data, interest around loans peaked between March and June 2020, with the phrase ‘can I get a loan’ rose by 11% compared to the same period last year, while the phrase ‘how to improve credit score’ was up by almost 27% since 2019.

UK credit score

The above image shows the England’s highest and lowest credit score hotspots rated out of 1699. 

Oxfordshire comes in at the top with a score of 1258, whilst Lancashire is bottom with 1132.

Top Five: Highest Credit Scores in the Country

Oxfordshire has the highest average credit score in the country, over two and a half times the national average of 570 and 154 points higher than Nottinghamshire, the area with the lowest credit scores in the UK.

 

Highest Credit Score Areas

Total Score out of a possible 1699

1

Oxfordshire

1258

2

Surrey

1255

3

Dorset

1239

4

Hampshire

1236

5

Berkshire

1236

Bottom Five: Lowest Credit Scores in the UK

All counties analysed have higher credit scores than the national average, but some areas in the UK lag behind their neighbours.

 

Lowest Credit Score Areas

Total Score out of a possible 1699

1

Nottinghamshire

1104

2

County Durham

1112

3

Leicestershire

1117

4

Yorkshire

1119

5

Lancashire

1132

What Impacts a Credit Score Positively

Several factors can impact credit scores throughout our lives. Registering to vote is an excellent place to start, as most credit scoring companies use this to help confirm your identity and address. Three ways to impact your Score positively include:

1. Set up direct debits where possible: Consistent, regular payments look good on your profile, so try to set up direct debits for as many payments as you can to ensure you pay on time and in full regularly. 

2. Maintain older accounts: The average age of your bank account is taken into consideration by credit scorers, so try to stick to one account that can be well managed over the long-term.

3. Don’t borrow more than you can afford: Always ensure you can meet minimum repayments easily, and pay off accounts sooner if you can. This shows you can manage within your set limits.

 

What Impacts a Credit Score Negatively

Credit scorers look for certain red flags when assessing your eligibility. Here are a few things you should try to avoid:

1. Missing payments: If this happens regularly, you could have a potential default flagged on your profile, and this can stick around for up to six years.

2. Lending beyond your means: Borrowing more than you can afford means sticking with repayments will be tricky, and when debt piles up, it can quickly become unmanageable. If you get a debt relief order or apply for bankruptcy, your credit score will be significantly impacted.

3. Regularly applying for credit: Each time you apply for credit, lenders will perform a ‘hard’ search on your credit history, and this is logged on your profile. If too many of these are logged, it could become a possible red flag.

 

Commenting on their average credit score analysis, Nick Lieb, Head of Operations at Share to Buy says:

“Many people have been asking us what constitutes a good credit score when trying to buy a home. The topic is more relevant than ever right now as we navigate our way through the uncertainty of the last few months, but with so many variables, and credit score companies all calculating scores differently, it’s not an easy question to answer.

We have combined data from two of the biggest agencies for our credit score review, and while it’s interesting to see the variation in numbers, average credit score is just one of several factors that play a part in your ability to get a mortgage. Therefore, even if your credit score is not where you want it to be, this shouldn’t be a deterrent in your search for a home”.

financial markets
ArticlesCapital Markets (stocks and bonds)MarketsNatural Catastrophe

Markets Have More Upside Potential Despite Second Wave Fears

financial markets

Markets have more upside potential despite second wave fears

By Luc Filip, head of private banking investments at SYZ Private Banking

While fears of a second wave of coronavirus bring renewed volatility to Europe and the US, investors are looking East for reassurance. China, which entered the pandemic three months ahead of the rest of the world – and now boasts positive economic growth – offers a useful template for the trajectory of the rest of the developed world. 

As witnessed in China, we expect a significant pickup in activity from Europe and the US now that social distancing measures are relaxed. The downward trend has finally slowed in these areas and economic indicators have risen above April lows, marking a positive first step in this direction. This was, and will likely continue to be, led by activity in the service and consumption sectors, as social distancing measures are lifted further and people learn to live in the new post-Covid environment. 

We anticipate the recovery will be faster than consensus expects, with the real possibility most economic activity could return close to pre-crisis levels by the beginning of next year. In fact, we believe the unprecedented amount of fiscal and monetary policy stimulus might fuel a temporary overshoot of economic growth in 2021 – before falling back toward more subdued long-term trends. 

Despite the very real risk of a second wave, of which we are already seeing signs, we do not believe this will result in another full- blown lockdown in developed countries. Instead, we would likely see more targeted measures, which would not derail economic recovery. Nevertheless, the recovery will remain concentrated in developed countries following in China’s footsteps, while the rest of the developing world – countries mostly dependent on manufacturing and commodity export – are likely to experience a far less robust recovery. 

 

Positioning for recovery

Before these positive developments are fully priced in by markets, now is still the time to increase risk exposure. But with ultra-low bond yields and sky-high equity valuations, many investors do not know where to turn. The key is to consider every aspect of an asset’s characteristics, including its merits compared to the available alternatives, as there is always relative value to be found.

Equity valuations, which regained pre-crisis highs in some sectors, may appear expensive given the current economic situation. However, it is necessary to go beyond purely intra-equity market metrics and consider equity valuations within the current rate environment. Taking into account the excess return currently offered by stocks over cash and bonds, equities are not expensive at all. In the US, this equity risk premium is close to a historic high. Therefore, combining both internal equity metrics and risk premia, we still see value in equities. 

 

Covering all bases 

Nevertheless, our confidence in the economic recovery does not discount the high probability of volatility in the markets – due to downside risks such as the speed of the recovery, the geopolitical situation, the likelihood of a second wave and a second lockdown. 

Therefore, diversification is crucial – across asset classes, regions and sectors. In the eventuality of a negative surprise, our exposure to gold, long treasuries and hedging equity strategies will protect the portfolio. Meanwhile, we increased our exposure to US and European equities in May through passive instruments to obtain wide-ranging coverage across all sectors. We also took advantage of the recent lower volatility to purchase additional portfolio protections as they became cheaper. 

Another key to managing downside risk is to focus on quality. We prefer holding proven quality assets which are continuing to perform well – even if they are more ‘expensive’. On the equities side, this means stocks with strong balance sheets, cashflow and brand, which are well positioned for the new normal of digitalisation – such as Google, Mastercard and L’Oréal. On the credit side, we reduced our exposure to high yield, as we anticipate a painful recovery for many companies, and reinvested the money into investment grade corporates – which are supported by the Federal Reserve’s purchasing programme. 

Generating performance while managing risk requires a flexible active approach to asset allocation. Through the crisis, our preference for quality, rigorous diversification and tactical protection have enabled our portfolio to participate in the market recovery, while mitigating downside risk. 

ftse 100
ArticlesMarkets

New Tool Shows The FTSE 100 Is Recovering Slower Than Other Global Markets

ftse 100

New Tool Shows The FTSE 100 Is Recovering Slower Than Other Global Markets

The Coronavirus lockdown decimated economies all over the planet, but while some stock markets are showing signs of recovery, the UK’s FTSE 100 is taking longer to bounce back.

Since falling to its lowest point in March, the FTSE 100 has climbed by 23%, which seems impressive, until you compare it with other global indices. Both the Nasdaq and Dax have risen by over 50%, while other key markets, such as China’s CSI 300, have also significantly outperformed the FTSE since the pandemic hit.

Chris Beauchamp, chief market analyst at IG Markets, Europe’s largest online derivatives trading provider, believes the FTSE 100 is “an index that has become a victim of its own composition”. Financials currently represent its biggest sector and Beauchamp says “a huge chunk of the index in terms of weighting is really underperforming”. 

He adds that the recent resurgence in sterling has also hit the FTSE, as its firms have lost value overseas.

For traders looking to keep track of the global indices and their relative rates of recovery, Daily FX has launched an innovative new tool that provides an instant snapshot of international market performance. 

Market Health allows traders to get a complete picture of global markets and indices in a single place. The free tool provides an instant picture of global market performance, currency strength and exchange opening and closing times. 

Using data from Quandl, Market Health allows users to take a macro look at global markets and indices including the Dow Jones, S&P 500, FTSE 100 and DAX 30 to help formulate and deliver on trading strategies.

Split between three main viewpoints, users can easily switch between world overview, stock exchange open times and index performance.

world overview

The global view combines exchange opening times and currency performance, presented on a world map. The map, displayed as a heat map, shows currency strength against a base currency of your choice.

The stock exchange opening times showcase eight global stock exchange markets with details of exactly when they open and close, how long they’re open for and whether or not they’re closed for any public holidays. 

The performance section groups major market indices into geographical groups and is a quick way to get a picture of whether a geographical market is up or down. Users can also filter by developed or emerging markets.

opening times
exchange performance

Peter Hanks, Analyst at DailyFX, explains how the tool is useful for experienced traders like himself: “It is useful to use the tool on specific days when trying to discern which market or region was most impacted by an event. For example, if the Federal Reserve has an interest rate decision, since the central bank typically has the most influence over the American markets, we would expect to see the most activity in those regions. If, on the other hand, another region has outpaced the US markets, there may be another theme at play that is driving market activity, so the tool is great at providing a bird’s eye view of the market.”

He goes on to explain how the tool is also useful for new traders: “When starting off on your trading journey, understanding the impact of other market sessions is very important. Volatility in one region can easily carry over into another, so being aware of when regions are active or inactive is very useful as the crossover periods are often flush with liquidity and can set the tone for an entire session.”

He explains how the tool is useful in the current situation: “Having an instant view of global market health is particularly useful for fast-moving world events such as today’s pandemic. The Market Health tool will be useful to many for getting a quick snapshot of what Covid-19 is doing to the world’s economies and how the different markets are reacting as we are all in different stages of the health crisis.”

David Iusow, Market Analyst at DailyFX, said: “Before a day begins, a trader needs to know how markets around the world have performed in other time zones. It is the first overview that one can get of the general market conditions and from which one can deduce the start of trading on the domestic stock exchange. Similarly, a market status map facilitates the identification of relative outperformance of markets during regular trading hours. The DailyFX market status has the advantage of a clear and interactive structure, giving traders exactly the benefits, they need to start a day.”

To use the Market Health tool click here: https://www.dailyfx.com/research/market-status

order finances
BankingCash ManagementPrivate BankingPrivate Funds

10 Minute Money Challenges to Get Your Finances in Order

order finances

10 Minute Money Challenges to Get Your Finances in Order

Auditing finances can sometimes feel like a huge chore, and things may have been forgotten about or pushed to the bottom of the to-do list during the pandemic. This guide by KIS Finance has listed some very easy and quick 10-minute money challenges that people can do in order to get their finances back on track if things have started to get out of control.

Check your direct debits and standing orders

A great place to start is by checking through all of your direct debits and standing orders to make sure there’s nothing you’re paying for which you shouldn’t be. You’ll be surprised at how easy it is to miss some payments coming out of your account, especially if they’re small and you’ve got a lot of them, but it’s so important to make sure you’re aware of every single one.

Go to your mobile banking app and go through the lists of direct debits and standing orders. Look at every payment and ask yourself three questions: do you need it?, can you afford it?, and is it worth it?
Bills are obvious; you must pay them. But do you have a gym membership which you only use a couple of times a month? In which case, it may be worth researching into whether you can buy a day pass or pay for gym classes as you go – this could work out much cheaper if you don’t go very often.

Subscription services is another category to look at. Are you paying for three streaming services that all do the same thing? If so, can you live with just one or two of them?

This task shouldn’t take you very long at all, and you’ll be surprised at how much money you can save.

Check for any recurring payments

Another important thing to check for are any recurring payments – otherwise known as Continuous Payment Authorities (CPAs). They work essentially like a direct debit, but they’re different in the fact that they use the long card number instead of your account number and sort code and the company can take money whenever they think they’re owed.

The reason you need to do this separately is because they won’t appear in the lists of direct debits or standing orders, they will appear on your bank statement as if they’re a debit card payment. Most will be taken on a monthly basis, so just have a look through the last few months of bank statements and see what’s coming out regularly.

You may have purposefully set some of these up, Amazon Prime and Spotify are examples. In which case, apply the same three questions as mentioned in the point above and cancel any that you can live without.
However, you may have set some up by mistake and these are important to get rid of. This may have been a free trial that you forgot to cancel, or some retail websites have in the small print that you will be signed up to a monthly CPA after making your first purchase and you didn’t realise. You do have the right to cancel any CPAs that you no longer wish to pay.

Compare your bills

If you’re not somebody who compares suppliers and just let your bills roll over every year, then this task is a must.

In some cases, the difference between the cheapest and most expensive tariffs for products like gas, electricity, and insurances can be hundreds of pounds a year. So, a quick check through a comparison website could make a big difference to your finances.
This should be done just before each of your current tariffs/policies come to an end, so you don’t end up paying any early exit fees. You’ll normally just have to fill out some personal details and any information required for the specific product, then you’ll be given a list of all the providers where the cheapest one is normally at the top. With most comparison websites, they will do a lot of the work for you when it comes to switching, so you just have to select which product you want and make any relevant payments.

This won’t necessarily have any immediate effects on your finances, but it will definitely benefit you in the long run.

Switch bank accounts

Switching bank accounts sounds like a massive job, but most of the major banks now offer an online 7-day switching service where they do everything for you, so actually it doesn’t take much time at all and it’s definitely worth the effort.

All you have to do is go to a comparison website which lists all of the available current accounts and compare who’s offering the best interest rates, perks, and functions. It’s important to do this every once and a while and especially when you have a change in financial situation, for example, an increase in income or a big change in the amount you have saved.

Once you’ve decided on the best current account for you, simply go to their website and say you’d like to open an account with them and then they’ll do the rest. They’ll swap over all of your regular payments like direct debits and standing orders and the only thing you’ll have to do is give your new account details to your employer.

Remove your card details from websites

Most online retail stores give you the option to save your card details after you’ve purchased something in order to make the payment process faster next time. Whilst it’s convenient that you don’t have to fill out the details manually every time, it can actually make you spend more when all the effort is taken out of the process.

If you struggle with spending too much and you’re a bit of an impulse shopper, take some time to go through the websites where your card details are saved and remove them. Then, next time you come to purchase something from that website, having to get your card and fill out the details will just give you a little extra thinking time as to whether it’s something you really need.
This isn’t something that will dramatically change your financial situation, but it is something that will help towards curbing the spending if that’s something you struggle with.

banksy brexit
Capital Markets (stocks and bonds)Markets

What is the Post-Brexit Outlook for Sterling?

banksy brexit

What is the Post-Brexit Outlook for Sterling?

As we head through the agreed Brexit transition period, many questions remain. One of these uncertainties is that there’s no definitive answer whether by 2nd January 2021, a deal will be in place. One of the key areas of concern is what effect Brexit will have on the standing of sterling as, inevitably, the currency will be affected.

It seems like far more than four years ago now that the UK made the momentous, and unexpected, decision that it no longer wanted to be part of the EU. Since then, a great deal of metaphorical water has passed under the bridge and it was only Boris Johnson’s bold election move last December that finally achieved the Tory majority needed to pass the legislation.

But, as we head through the agreed transition period, many questions remain. One thing that is for certain is that there will be no extension to this beyond 1st January 2021. However there is no definitive answer yet on what the arrangements will be concerning the UK’s dealings with the EU after then. It’s equally uncertain whether, by 2nd January, a deal will be in place, and some observers believe that a no-deal Brexit is becoming a real possibility.

One of the key areas of concern is what effect Brexit will have on the standing of sterling as, inevitably, the currency will be affected.

Volatility is key

Perhaps the early signs weren’t good, as its value on the currency markets immediately plunged by around 10% on the announcement back in June 2016 that the country was set to go it alone. Since then, the trend seems to have been that its value has rallied whenever rumours of a softer, more negotiated split with the EU have been circulating. For example, back in October 2019 when it was believed, incorrectly as it turned out, that the transition period might be extended, the value of the currency rallied strongly on the world markets.

But, each time there is a feeling that the future is a little more uncertain, sterling’s essential volatility comes to the fore, once again causing considerable turbulence in the currency exchanges.

Good news for some…

Of course, this isn’t necessarily bad news for everyone – with people who derive some benefits from forex trading being a case in point. Through making the right decisions, and operating using a recommended forex broker, traders stand to benefit from significant changes in relative values between paired currencies. For those in this category, choosing an effective broker is a relatively simple process as in-depth reviews of said brokers abound.

… but not for others
Cargo Ship, By Szeke

Volatility in the value of sterling is, unsurprisingly, not such good news for many other sectors of the UK economy. A prime example is the country’s manufacturing industry, especially in the case of firms that rely on importing components and materials from abroad. At a stroke, they can find themselves having to pay more to continue operating – a cost that they are generally likely to pass straight on to the consumer.

Incidentally, this is not the only impact that Brexit is predicted to have on UK industry. There is a very real fear that it will limit the amount of investment available for research and development which could well have a far wider knock-on effect.

Because the value of sterling has always been so closely linked with confidence in the economy as a whole, the consequences of a country hamstrung in its efforts to develop and innovate could also make themselves apparent.

Looking on the bright side

But we should perhaps be wary of falling into the trap of becoming too pessimistic and gloomy about the prospects for sterling in a post-Brexit world. Deal or no-deal, the UK will definitely be able to open up new trade deals with the rest of the world once the restrictions imposed by EU membership have been lifted. Depending on the nature of those deals, this could mean sterling receives a real shot in the arm and that, now more than ever, will be what everyone should be hoping for.

pension
FundsPensionsPrivate BankingWealth Management

UK Gender Income Gap for Single Pensioners Widens by Almost 20% in Four Years

pension

UK Gender Income Gap for Single Pensioners Widens by Almost 20% in Four Years

Men over the age of 75 receive £114 a week more from their pension income than women of the same age, according to a new report.

Single male pensioners receive up to 26 per cent more income than female pensioners, according to official data compiled by digital wealth advisory firm, Fintuity. The findings, analysed using data compiled by the Office for National Statistics, reveals that the gender pension gap between single men and women was only eight per cent in financial year (FY) 14/15, noting a rise of 18 per cent in four years.

In 2018/19, the average incomes for males, who were under 75 and 75 or over, were £441 and £429 per week, respectively during this period. At the same time, these figures were significantly lower for the same age groups of women: their average income per week reached £333 for those under 75, and £315 for 75 or over.

Furthermore, according to analysis from Fintuity, a woman in her 20s would need to save approximately £1,300 extra per year in order to close the gender pensions gap. However, this average amount increases depending on age. For example, the average 30 year old woman would require an additional £2,000, a 40 year old woman would require an additional £2,900 and a 50 year old woman would need to acquire a further £5,300 in order to close the gender pensions gap.

Gross income of single pensioners consists of different sources, including; benefit income, occupational pension income, personal pension income, investment income and earning income. According to the most recent pensions data, in FY 18/19 occupational pensions income for men was on average 35 per cent higher than women, compared to 23 per cent four years prior.

The personal pension income gap was 63 per cent in FY 18/19, compared to 46 per cent in FY 14/15, and, the investment and earnings income gap between male and female pensioners increased from five and eight per cent in FY 2014/15, to a massive 61 and 74 per cent respectively. Suggesting that women are not as capable of making savings and investments due to low income which results in lower level of pensions.

Ed Downpatrick, Strategy Director, Fintuity comments:

“Despite government initiatives to improve the pensions income for women, it’s clear that no amount of support programmes can make up for the occupational gender disparity in the UK. This problem needs to be tackled head-on, with correct support initiatives put in place to enable women to get a much fairer deal.

“With Fintuity, women and men of all ages can receive professional, yet affordable, financial advice in order to see what options are available to them so that they can manage their pension income. All of this can be conducted online, via our digital platform, making professional financial help more accessible than ever.”

For more information on how to effectively save, spend wisely, understand alternative income routes, or improve monthly pension payments, please visit: https://fintuity.com/ 

Take care of what you share privacy and protection in a pandemic
LegalRegulation

Take care of what you share: privacy and protection in a pandemic

Take care of what you share: privacy and protection in a pandemic

Caroline Holley, Partner, Family & Divorce, and Oliver Lock, Associate, Reputation Management, Farrer & Co

A good reputation, hard won, can be ruined in moments. Never have those words been more true than in this strange new “normal”.

The coronavirus lockdown period has resulted in an exponential increase in the time that people are spending online, with greater use of video calls and social media platforms. This brings with it a number of security and confidentiality issues, some of which may not ordinarily be at the forefront of people’s minds.

Privacy has long been a concern of many, but recently we have seen a sharp rise in confidentiality provisions being included in a range of agreements, such as employment contracts, pre or post nuptial agreements, parenting plans used by separated parents, as well as non-disclosure agreements (NDAs).

Those who have entered into such agreements would be wise to review them in light of their new online lives. Others may think now is the right time to revise agreements to include new, or tighten up existing, confidentiality provisions.

Social Media
Social media use has become more prevalent than ever. People often share huge amounts of personal information on various social platforms, not only in terms of what they say directly, but also information gleaned from photos or videos posted or articles shared or retweeted. The potential pitfalls are wide-ranging and extend beyond simple privacy concerns. Both online and physical security, as well as reputational issues, need to be given careful consideration.

Employment contracts

Contracts for household staff, particularly nannies, regularly include confidentiality provisions, such as clauses preventing disclosure of personal information obtained during employment. However, they can also extend to the employee’s own use of social media. An open Instagram account of a high-profile family’s nanny could disclose the whereabouts of the family, details of their home or private photographs of children. There have been notable incidents where well-known individuals have been burgled when away from home, as a result of information gleaned from social media posts.

Pre and post nuptial agreements

Couples in relationships can have very different approaches to social media. Whereas one half of a couple may enjoy a large following or generate an income from their profile, the other may eschew social media entirely, potentially creating considerable conflict.

Some couples are therefore choosing to agree their intended approach to social media in nuptial agreements, ensuring that the family privacy is protected even in the event of marital breakdown. Right at the outset of their relationship, couples can discuss their views of social media – what they are comfortable sharing and with whom – and having reached a consensus, can record that understanding either in a pre-nuptial agreement or NDA.  As can be imagined, it is much easier to come to a consensus early on in a relationship than it is after it has ended.

Agreements such as these are flexible and entirely bespoke, dealing with the couple’s private life, business affairs or financial information that may have been shared by either party. They may include clauses on whether photographs of future children or of the interior or exterior of their home be shared, a particularly important consideration for those in the public eye.

As the number of people earning an income from their social media presence and posts grows, it has become even more important to consider such agreements, and the potential financial impact of them, when agreeing provision in a pre-nuptial agreement.

Video Calls
The coronavirus epidemic and resulting lockdown has seen many of us have turn to video calls to facilitate many daily activities; from work, and social arrangements, to exercise classes or even church services.

Keeping in touch with the outside world in this way has been a lifeline to many. But some people are using this technology without due consideration of security concerns and, again, confidentiality and privacy issues arise. Users may be sharing far more information than intended – their location, security weaknesses, evidence of expensive artwork on the wall, or even family photos. This is particularly concerning when the call could be recorded, or if there are a number of unknown people on the call. The simplest way to guard against such issues is to add a blank background to all calls, a feature available on most platforms, to ensure privacy, security and reputation are all protected.

What if an agreement is breached?
Breaching an NDA or confidentiality clause may be very easy to do without realising.  For example, it may have been agreed that neither party will share pictures of their children, but one of them forgets to remove family photos from the wall behind them in a video call. For couples on good terms, this may not be such an issue. But should the relationship have broken down, this could have serious consequences. Actual liability will always depend on the exact terms of the agreement and the level of fault asserted. But, as a minimum, parties are usually expected to take reasonable steps to ensure information does not get into the public domain.  

International considerations
Restrictions arising from the pandemic vary between countries and for those who continue to travel, it is important to keep abreast of the differing rules in different locations. In Singapore, for example, it has been reported that permissions to work have been withdrawn from a number of expats as a result of social media images showing them out socialising in breach of lockdown rules there.

Coronavirus has changed the way that we live and work, quite possibly forever. Restrictions are now beginning to lift but even so, our reliance on the growing online world is most likely to remain. It is important to consider these issues as we go forward into the ‘new normal’, remaining alert to possible breaches of agreements and ensuring that in future, appropriate provisions are incorporated into personal agreements.

 

boost economy
Finance

How The UK Furlough Scheme Boosted the Economy

The term furlough refers to a temporary leave of absence. Under the current economic and employment situation, a large number of employees in the UK have been furloughed. The UK Furlough Scheme is providing fixed wages to the employees who would have otherwise been unemployed.

What is the Furlough Scheme, and How Does it Work Now?

The UK Furlough Scheme is the government’s response to the economic damage caused by the coronavirus pandemic and its financial implications. The furlough scheme was launched on April 20, 2020, and aimed to reduce unemployment and related costs. The UK Furlough Scheme comprises of Coronavirus Job Retention Scheme (CJRS) and Self-Employment Income Support Scheme (SEISS).

While Coronavirus Job Retention Scheme focuses on paying the wages of employees who would have been laid off otherwise, the SEISS comes in the form of grants to self-employed individuals whose businesses have been adversely affected by COVID-19. To be eligible for grants under the SEISS, you must earn over 50% of your total income from self-employment, and your average annual profit must be less than £50,000. The individuals must have been self-employed from before April 6, 2019, and must have filed tax returns for the financial year 2018-19. The amount of grant will be based on the average of tax returns for the past three tax years.

For applications to the CJRS, the employers must have started a CJRS scheme before March 19, 2020, and should be enrolled for CJRS online. All employees, whether part-time, full-time, flexible, agency or zero-hour contracts, can be put on furlough. The coverage of the UK Furlough Scheme varies from town to town, depending on the percentage of employees furloughed. For instance, the maximum coverage is in the cities of Crawley, Burnley, Slough, Sunderland, and Birmingham, with the largest number of employees sent home by their employers. Crawley reported 33.7% of the employees furloughed in May 2020, while Cambridge reported 17.4% of the employees furloughed in the same period, being one of the least affected cities.

The employers and self-employed individuals are utilising the UK Furlough Scheme optimally. According to data released by the government, over one million firms were using the job retention scheme in May 2020 wherein the wages of 8.4 million workers have been covered. On the other hand, the self-employed income support scheme received 2.3 million claims for over £6.8 billion in income support. The construction industry has been the most affected and had the highest number of claims under the SEISS. The government has paid out a total of £1.76 billion to 680,000 construction employees who were furloughed due to the pandemic. The companies that have used the schemes include Costain, Morgan Sindall, and Wates, among others.

Updates on the Scheme and How is it Changing

The UK Furlough Scheme was launched on April 20, 2020, and planned to cover the wages for March, April, and May. The furlough scheme was later extended to cover the month of June and has now been announced to run until October 2020. Under the Coronavirus Job Retention Scheme, the government pays 80% of the furloughed employees’ wages to the employer, up to £2,500 per month, in addition to the national insurance and pension contributions.

For the months of June and July, the government will continue to pay the same and employers will not be required to pay anything; however, the employers will need to bear the national insurance and pension payments from August 2020 onwards. For September, the state will pay 70% of the employees’ wages and the employer will be required to take care of the remaining 10% and the insurance and pension payments, while in October 2020, the state will pay 60% and the employer will pay the remaining 20% of the wages.

Similarly, for the SEISS, the government currently pays 80% of the average monthly trading profits, paid out for three months together, capped at £7,500 in total. After the extension of the scheme in May 2020, the government will pay 70% of the average monthly trading profits, capped at a maximum of £6,750.

Benefits of the UK Furlough Scheme

The UK Furlough Scheme has proved to benefit the workers, employers, government and the economy on the whole. The scheme has helped to keep the unemployment rates low and avoid the financial and emotional costs associated with laying off and rehiring employees. Thus, the scheme has limited the damages caused by the pandemic and kept the money flowing in the economy.

Additionally, the advance notice about the furlough prepared people to save up the amount of money they would lose by reducing their expenses. The money saved can then be invested in general investment accounts, money market funds and short-term CDs to generate additional income. The returns on the investment will make up for the lost income.

How Does the Furlough Scheme Affect Pension?

The government has made it clear that furloughed payments are pensionable. The employers can claim the pension contributions made for the furloughed employees; however, the amount is capped at the minimum automatic enrolment contributions equating to 3% of the qualified earnings. For employers making additional pension contributions over and above the minimum, only the minimum amount can be reclaimed from the government.

Moreover, if the employer elects to top up the salary of their employees beyond the 80% offered by the state under the UK Furlough Scheme, the total salary is pensionable. The additional costs related to the top-up wages paid by the employer need to be borne by the employer itself. For the self-employed individuals, it is advisable to continue making payments towards their personal pension schemes or SIPPs every month so that they can sail through the difficult financial times later and also save on taxes.

What is the cost of the Scheme to the UK Government?

The UK Furlough Scheme is currently supporting about 7.5 million jobs. As a result, by June 2020, the government has already spent over £20.8 billion on the Job Retention scheme. The cost is expected to reach £80 billion by the end of October 2020. Furthermore, 70% of the individuals eligible under the SEISS have made a claim, for a total cost of £9 billion to the UK government.

Problems with the Scheme

The UK Furlough Scheme is proving to be highly beneficial for individuals and employers. However, the scheme is very expensive for the government and is costing about £8 billion a month. The generous nature of the scheme can pose potential problems for the economy as it may deter the transition of the economy to recovery. The scheme cannot keep on supporting the jobs that will not remain viable in the post-COVID economy and will only delay the restructuring of the businesses. Despite the high costs associated with the UK Furlough Scheme, it has been a saviour for the UK economy and its workers. The scheme has helped to avoid a surge in unemployment and saved many workers from layoffs. The hold on economic activities and the associated damages would rather be more temporary than permanent, owing to the scheme, as the workers will be able to go back to their businesses and the economy will bounce back sooner than later.