Take control of your finances in an uncertain world

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Take control of finances

Please note that this article is over six months old. While Blevins Franks takes care to make sure that information is accurate on the date of publication, some content may change over time. You should not rely on the accuracy of legislation and tax information in this article; take professional advice for your circumstances.

Take steps to control your financial future.  For peace of mind, it’s worth spending a bit of time to review your pensions, savings and investments, tax planning, and estate planning to make sure it’s on track to achieve your objectives.

The last few years have emphasised how uncertain life can be. Brexit and the pandemic have now been followed by the worrying and upsetting events in Ukraine.

This perhaps makes it more important for you to take control where you can, as much as you can, particularly when it comes to your family’s long-term future and security.  So here, we look at the key wealth management considerations that should be reviewed from time to time.

Take control through good pension planning

For most of us, our pension funds are key to our long-term financial security. The UK pension freedoms may no longer be ‘new’ but they can still cause uncertainty when deciding what you should do with yours.  The more choice there is, the harder it can be to decide, and each option has pros and cons.

Many expatriates have chosen to transfer UK pensions to a Qualifying Recognised Overseas Pension Scheme (QROPS) for the advantages they can offer, such as income and currency flexibility. But, they don’t suit everyone – you may find it more beneficial, for example, to reinvest UK pension funds into investment arrangements which are compliant and provide advantages in your new country of residence, or even leave your UK pension where it is.

Also, the UK has recently made changes that make transferring to QROPS more difficult. In any case, with pensions, you should always take personalised, regulated pensions advice to ensure you take the best course of action for your particular circumstances.

Review your savings and investments

It’s impossible to control what will happen in the markets in the future. We can’t know what geopolitical events may cause volatility or prices to rise; or what interest rates will be five, ten, or twenty years from now.

But you can take steps to build an investment portfolio that:

  • Is based on your risk profile, circumstances, time horizon, and objectives
  • Includes suitable asset allocation and diversification to control risk
  • Is designed to provide capital growth over the long term to beat inflation so you can maintain your spending power through retirement.

Geopolitical events, like those we’re seeing at the moment, can cause significant market turbulence, but that doesn’t mean it’s the time for impulsive reactions or short-term changes.

History has shown that ‘timing’ markets is incredibly difficult, especially where out-sized market movements are involved. And in timing, an investor needs to get it right twice –  when to encash some investments and when to get back in the market.

Getting one right is rarely achieved, as the news has already arrived by the time you can look to act (so markets will already have reacted). The same also applies when markets move sharply upward as we saw after the initial covid news in 2020.

Investing is a marathon, not a sprint, so being patient and sticking with the plan can pay off.

Take control of your estate planning

While we cannot avoid death, with good estate planning we can control who receives our assets and when. Is your legacy on track to go to your chosen heirs according to your wishes and with minimal taxation? Take care to understand the succession laws and inheritance taxes in your country of residence, and anywhere else you have assets and heirs. Be sure to review the pros and cons of using the EU succession regulation ‘Brussels IV’ to override local ‘forced heirship’ rules.

You need a strategy that achieves your wishes while making the process as straightforward and tax-efficient as possible for your heirs. And, don’t forget your own needs; consider the tax implications to find the optimum solution for your wealth during your lifetime too.

Take control of your tax planning

The way you structure your assets and wealth can make a significant difference to your tax bill. You need to make sure your arrangements are structured appropriately for your life abroad as well as your particular aims, circumstance, goals, and risk appetite.

Are you taking advantage of tax-efficient structures available where you live? Besides tax savings, these may offer additional benefits such as currency and income flexibility and estate planning advantages.

Take control of your finances by being informed

Ultimately, cross-border tax and financial planning is complex. While you can do some groundwork yourself, you will benefit from talking to a specialist adviser with in-depth knowledge of the tax regime in your country of residence, and its interaction with UK rules.

The regulatory structures surrounding tax planning and financial management is continuously evolving, so be sure to subscribe to our newsletter and stay up to date

Blevins Franks can help you take advantage of available tax, investment, pensions, and estate planning opportunities to ensure you do what works best for you and your family, today, tomorrow, and in the future.

Contact us today.

Tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; individuals should seek personalised advice.