Do you want to create a legacy by passing on assets to your loved ones? There’s more than one way to do it, and you might want to combine several different options.
As part of your estate plan, you might want to consider who you’d like to benefit from your estate and how you will pass on assets. Here are four methods for transferring some of your wealth to loved ones.
Your estate plan doesn’t just cover passing assets to loved ones when you pass away. You might also want to gift assets during your lifetime.
There are several key benefits to creating a living legacy.
First, it could help you provide financial assistance to your loved ones when they need it most. For example, you might gift a lump sum when your children are preparing to buy their first home. A well-timed gift could have a greater impact on your beneficiaries’ financial wellbeing than an inheritance. Plus, you also get to see the comfort your gift provides.
Second, if your estate could be liable for Inheritance Tax (IHT), gifting during your lifetime could reduce a potential bill. If the value of your entire estate is below the nil-rate band (£325,000 in 2026/27), then no IHT will be due. If the value of your estate exceeds this threshold, you might benefit from considering IHT and strategies to reduce it.
Keep in mind that not all gifts are considered outside your estate immediately for IHT purposes. Gifts that are not paid as part of your allowances may be included when calculating IHT for up to seven years after they are given.
In addition, take some time to understand the long-term implications that gift giving now would have on your financial security.
The traditional way to pass on assets is through a will after you die. You can use your will to name who you’d like to benefit from your estate.
You can choose how you want your assets to be distributed. You might:
While it is possible to write a valid will yourself, seeking legal advice could minimise the chance of mistakes occurring.
Once you’ve written your will, it’s important to keep it up to date to ensure it continues to reflect your wishes.
Your pension isn’t usually covered by your will. Instead, you’ll need to complete an expression of wish form with each provider you hold a pension with.
This form states who you’d like to receive your pension wealth when you pass away. An expression of wish isn’t legally binding, but it is something your pension provider will take into account when making a decision.
From April 2027, pensions will be included in your estate for IHT purposes, so you may benefit from reviewing how you’d like to use your pension and pass it on.
A trust is a legal arrangement that holds assets for the benefit of your named beneficiaries. You may use a trust to pass on assets during your lifetime or when you pass away.
There are several different types of trust that have different purposes, and the arrangement of them is often complex. It’s typically difficult or impossible to retrieve assets once they’ve been placed in a trust. As a result, it’s a good idea to seek specialist legal advice to understand if a trust could be right for you and what type of trust might be suitable. Keep in mind, your personal circumstances and goals will affect your options, and trusts are not an appropriate option for everyone.
As settlor of a trust, you can set out how and when you’d like the assets in the trust to be used, which the trustee, who will manage the trust, will follow.
For example, you might decide to place assets in a trust for a child and state that the trustee may make withdrawals for educational purposes, and that the beneficiary can have full control of the assets once they turn 25.
Alternatively, you could state that the beneficiary may receive the dividends paid by investments, but they cannot sell the stocks and shares.
In some cases, you may still benefit from the assets placed in trust during your lifetime.
Like gifts, assets placed in a trust are not automatically outside your estate when making IHT calculations.
If you have any questions about your estate plan and how you might pass on assets to loved ones, please contact us.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate cashflow modelling, will writing, estate planning, or trusts.
From 6 April 2027, many unused pension pots will be included in Inheritance Tax (IHT) calculations.
Since the government announced the change in the 2024 Autumn Budget, an increasing number of people have opted to withdraw their tax-free lump sum from their pension as soon as they can.
Currently, you can access your pension from age 55 (rising to 57 from April 2028). According to MoneyWeek (9 April 2026), the number of 55-year-olds taking their lump sum reached a five-year high in 2024/25.
However, while many people may be hoping to reduce their pension’s IHT liability, taking funds early might not be as tax-efficient as you think. Not only could funds still be subject to IHT if they remain part of your estate, but they could also be subject to other taxes – depending on how you use them.
Before rushing to withdraw your lump sum, it’s important to take a step back and carefully review your financial plan. Here are five questions you should answer before making a decision.
While most unused funds in private pensions will be included in IHT calculations from April 2027, that doesn’t necessarily mean any tax will be due.
As of 2026/27, IHT is only charged on the portion of your estate exceeding your nil-rate band:
The portion of your estate exceeding your nil-rate band is typically taxed at 40%.
It’s worth considering that your pension pot is likely to reduce as you draw down an income, depending on how long you live.
Remember, your tax liability, including taxes that may be applied to your estate after you pass away, is affected by your personal circumstances, as are the allowances and exemptions that are applicable. A financial planner could help you assess your tax liability.
You can generally withdraw a portion of your pension without being charged Income Tax. As of 2026/27, this is capped at 25% of your total funds, or the £268,275 Lump Sum Allowance, whichever is lower.
After you have taken your tax-free lump sum, withdrawals are typically subject to Income Tax at your marginal rate.
So, if your total income means you exceed the higher-rate threshold, a portion could be liable for Income Tax at the same rate as IHT (40%).
If you only take your tax-free lump sum, it’s worth considering that more of your withdrawals in retirement will be charged Income Tax, as you’ve used up your tax-free allowance.
When funds are invested in a pension, growth is generally exempt from Capital Gains Tax (CGT) and Dividend Tax. Income Tax is only charged once you draw down more than your tax-free lump sum.
However, taking money from your pot early could result in it being taxed outside of your pension.
Ultimately, removing funds from your pension isn’t necessarily the most tax-efficient option. If the money remains in your estate when you die, it may still be liable for IHT.
If you choose to invest your money, either through a pension, Stocks and Shares ISA, or through a general investment account, keep in mind that the value could fall as well as rise.
Without careful planning, taking funds from your pension early could leave you short of your required income in retirement.
As a result, you may have to adjust your lifestyle or risk running out of funds later in retirement.
A financial planner can help you calculate how much income you could need in retirement, based on your ideal lifestyle, tax liabilities, and average inflation. Once you understand how much you’re likely to spend, you can determine whether you can afford to withdraw from your pension early.
Naturally, you want to pass as much of your wealth as possible on to your chosen beneficiaries.
There are a few ways you can help reduce the IHT charged on your pension and wider estate:
These strategies might not be appropriate for all circumstances. It’s important to consult with a financial planner for guidance before making any irreversible decisions that could affect your finances.
Please contact us if you have any questions about how the IHT changes could affect your retirement plan and tax liability.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate estate planning, tax planning, or will writing.
Retirement is a significant life transition. Some of the financial habits that served you well during your working life might no longer suit your retirement lifestyle.
Sticking to your current financial habits could mean you miss out on opportunities to enjoy your retirement, or even mean you risk using up your savings too soon. Read on to find out why.
As you retire, you’ll often move away from earning an income and building wealth towards depleting your assets.
If you’ve established a good money habit of regularly saving or investing during your working life, it might be difficult to now spend your wealth. It’s something retirees might feel nervous about because they may worry they won’t have enough for later life.
Indeed, according to an Aviva survey (12 May 2025), only half of mid-retirees aged between 65 and 75 who do not pay for financial advice are confident they’re on track to make their pension savings last for life.
Holding on to the habit of limiting your spending could mean the retirement you’ve worked hard to secure doesn’t live up to your expectations, even if you’re financially secure enough to pursue your aspirations.
Alternatively, if you continue with your current money habits and spend as though you have a salary coming in, you might risk withdrawing too much from your pension.
Retirement could also affect what’s appropriate in other areas of your financial plan.
For example, if you continue to invest in the same manner, you might be taking too much risk if you plan to access the money soon. Similarly, if you have debt, how you manage repayment might shift if you don’t have a guaranteed income in retirement.
Balancing different priorities and goals in retirement can be tricky, but a long-term plan could help you adjust your financial habits to suit your short- and long-term needs.
A key challenge when managing your retirement finances is that you need to consider how your assets and income needs could change over time. If you retire in your 60s, you might need to create a retirement plan that spans several decades.
A cashflow model could help you visualise your wealth and how it might change.
Your financial planner will start by inputting data about your current finances, and then make certain assumptions to show how your finances could change. These assumptions might include your income needs based on average inflation, your plans, or expected investment returns.
You can then start to test different scenarios to assess how they’d affect your long-term financial security. So, as you prepare to transition into retirement, you might use your cashflow model to help answer questions like:
With this information, you may feel more comfortable adjusting your money habits, such as using assets to create an income that allows you to get the most out of retirement.
It’s important to note that while a cashflow model can be a useful tool as part of your long-term plan, the outcomes cannot be guaranteed.
In addition, a cashflow model relies on accurate data. So, you should regularly update it to reflect changes to your finances, overall circumstances, or goals.
If you’d like to talk about your retirement finances and how we could support you as you transition into the next stage of your life, please get in touch.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate cashflow modelling.
Reaching your long-term goals often requires careful planning and consistent action. A financial plan could help you work towards these goals and, in some cases, investing may play an important role too.
In previous blogs, you’ve read about how you might reach short- or medium-term goals. Now, read on to discover some key considerations for long-term goals.
You’re likely working towards multiple long-term goals that will take many years to reach. Among them might be creating an education fund for your children or saving enough to retire comfortably.
Goals like these are often important for your wellbeing, and knowing you’re working towards them can be reassuring. However, it can also be challenging.
One of the key difficulties is being unsure whether you’re on track. Imagine you have young children and you want to build a nest egg that will support them if they choose to pursue further education. You’ll need to understand what costs your child might face, what external factors could influence these costs, and the fact that you might be contributing to the fund for more than a decade.
Regular financial reviews could help you assess your progress and highlight where adjustments might be necessary.
In addition, long-term goals might feel overwhelming. For example, the amount you calculate you need in your pension before you can retire might seem like an impossible sum.
A financial plan could help you understand how you might reach your target amount by accounting for contributions and potential growth over your working life. As a result, being proactive when planning for the long term may help you feel more confident about your future.
A clear objective could give your decisions direction when you’re working towards a long-term goal, and investing could help your money grow at a faster pace.
As investments may experience volatility, investing is not usually a strategy that’s suitable for short- or medium-term goals. But if your goal is more than five years away, it might be a suitable option.
Inflation may reduce the real value of your assets. As the value of goods and services is rising, if the value of your assets doesn’t keep pace with or exceed the rate of inflation, you can buy less with them. Over a long-term time frame, inflation can have a dramatic effect.
Imagine you had placed £10,000 in a savings account in 2000. According to the Bank of England’s inflation calculator, your money would need to have grown to £19,514 to maintain the same spending power in April 2026, due to average annual inflation of 2.58%.
If the savings account hasn’t delivered interest that matches inflation, the value of your money has fallen in real terms.
When you’re putting money aside for a long-term goal, investing might help its value to rise at a faster pace than inflation, so you’re able to reach your target sooner.
For example, according to the Guardian (31 December 2025), the FTSE 100 – an index comprising the 100 largest companies listed on the London Stock Exchange – delivered returns of 21.5% in 2025, marking its best 12-month performance since 2009.
The Office for National Statistics (21 January 2026) reported that inflation in the 12 months to December 2025 was 3.6%. As a result, if your money was invested in the FTSE 100, it could have outpaced inflation and grown in real terms.
For this reason, pensions are typically invested, and this approach could make sense for other long-term goals as well.
However, it’s important to note that investments carry risk, and investment returns cannot be guaranteed. There is a risk that you’ll lose money when investing, and past performance is not a reliable indicator of future performance.
A financial plan could help you identify what level of risk is appropriate for you by considering a variety of factors, from your investment time frame to your other assets.
If you’d like to talk about creating a financial plan that supports your long-term goals, please get in touch.
Next month, read our blog to find out how a tailored financial plan could help you balance short-, medium-, and long-term goals.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
Inheritance Tax (IHT) is a growing concern for many people in the UK, with increasing numbers of estates facing a rising tax liability.
Each year, the amount of IHT paid to HMRC is increasing. By 2030/31, the Office for Budget Responsibility (February 2026) forecasts that IHT receipts will reach £14.5 billion, up from £8.3 billion in 2024/25.
Frozen tax-efficient allowances are a key driver behind this trend. As your estate grows, a larger portion could exceed the threshold and become subject to IHT.
What’s more, once your estate reaches £2 million, your tax-efficient allowance can start to reduce, exposing more of your wealth to IHT.
Read on to learn how the value of your estate could affect the amount you can leave behind tax-efficiently.
Your IHT allowances are known as “nil-rate bands”.
As of 2026/27, the nil-rate band is £325,000. This is the amount you can leave behind when you die without the value being included in IHT calculations. The portion of your estate exceeding the nil-rate band is usually taxed at 40%.
You may also have a residence nil-rate band if you leave a primary residence to a direct descendant. This can be up to £175,000, as of 2026/27, bringing your potential tax-efficient allowance to £500,000.
If you’re married or in a civil partnership, the spousal exemption usually allows partners to leave assets to one another tax-free. Any unused nil-rate band typically transfers to the surviving spouse, potentially allowing couples to pass on up to £1 million tax-efficiently.
The nil-rate bands are expected to remain frozen until at least 2031, meaning a larger portion of your estate could be taxable than if the thresholds had risen with inflation.
Remember, the portion of your estate that may be subject to IHT will depend on your personal circumstances. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts.
The residence nil-rate band usually begins tapering once the value of your total estate reaches £2 million.
For every £2 your estate exceeds the threshold, you lose £1 of your residence nil-rate band. So, if your estate were £100,000 over the threshold, your allowance would reduce by £50,000.
The taper continues until your estate reaches £2.35 million, at which point you lose your full residence nil-rate band. This can mean an additional £175,000 of your estate could be subject to 40% tax, potentially increasing your IHT bill by £70,000. For a couple losing the full allowance, the IHT bill could rise by £140,000.F
While married and civilly partnered couples can typically transfer unused nil-rate bands to potentially double their tax-efficient allowance, the taper threshold remains fixed at £2 million. In some cases, if assets are transferred to a surviving spouse, their total estate could exceed the threshold, and they could lose both partners’ residence nil-rate bands.
MoneyWeek (February 2026) reports that the number of estates valued at over £2 million could rise from 3,620 in 2023 to 16,000 by 2030/31.
The level at which the residence nil-rate band begins to taper is set to remain frozen at £2 million until at least 2031, having not changed since it was introduced in 2017.
According to the Bank of England’s (April 2026) inflation calculator, the threshold would have risen to over £2.7 million if it had grown with inflation since 2017.
As earnings rise and asset values increase with inflation, more estates could pass the £2 million threshold and start losing their tax-efficient allowance.
In particular, rising property prices are pushing up the total net value of many estates. With the threshold frozen, it’s important to consider how the value of your assets might grow over the long term when planning to pass them on tax-efficiently.
What’s more, from April 2027, your unused pension pots could be included in your estate for IHT purposes when you pass away. Depending on how much is left in your pension when you die, this could add a significant amount to your estate’s net value, potentially pushing your total over the £2 million threshold.
If you’re worried about your estate exceeding the taper threshold and losing your nil-rate band, you might consider taking proactive steps to mitigate your estate’s IHT liability.
1. Give gifts in your lifetime
Gifting wealth in your lifetime could be an effective way to reduce the value of your estate and the portion of it that’s subject to IHT.
However, gifts that do not qualify for an exemption may be included in your estate for up to seven years after they were given. If you die within seven years, the value of the gift could be subject to IHT at a tapering rate. As a result, your estate might be liable for more tax than anticipated.
It’s also important to ensure gifts are affordable and will not impact your current financial wellbeing or long-term financial goals. A financial planner can support you in incorporating tax-efficient gifting into your wider financial plan.
2. Leave a charitable legacy
If you leave 10% or more of your net estate to charity when you die, your IHT rate could reduce from 40% to 36%. In addition, gifts left to charities when you pass away are not included in IHT calculations. Depending on your circumstances, it could be an effective strategy to reduce your IHT bill while supporting a cause close to your heart.
Additionally, giving to charity during your lifetime can help reduce the size of your estate to mitigate an IHT bill and prevent your residence nil-rate band from being reduced.
3. Place assets in trust
You may be able to mitigate an IHT bill by putting assets in a trust.
Assets held in a trust may still be liable for IHT, depending on the type of trust used and when you pass away. However, typically, the value will not be considered when calculating whether your estate exceeds the £2 million threshold for losing your residence nil-rate band.
The rules for placing assets in trust and the IHT implications can be complex and vary between different trust types. Usually, you will be unable to remove assets from a trust once you have transferred them in. So, it’s important to seek legal and financial advice before making any irreversible decisions.
If you’re worried about your estate’s IHT liability, get in touch to find out how we can support you to pass on wealth tax-efficiently.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate estate planning, tax planning, Inheritance Tax planning, or trusts.
During April 2026, markets have continued to experience volatility as the conflict in the Middle East has developed. Find out what external factors may have affected the performance of your investments.
One effect of the conflict on global markets is the rising price of energy. Indeed, analysis from UBS suggests that March 2026 experienced the largest increase in global energy inflation for at least 25 years.
Remember, market volatility is a part of investing, and it’s important to take a long-term view when reviewing the performance of your portfolio. The value of investments may rise or fall, and you may not get back the full amount you invested.
April 2026 started with the hope that the conflict in the Middle East would be resolved, which led to rallies in European and US markets.
Among the indices that were up on 1 April were the UK’s FTSE 100 (1.85%), France’s CAC 40 (2.3%), Italy’s FTSE MIB (2.6%), Spain’s IBEX (2.7%), and the US’s Dow Jones Industrial Average (0.6%).
However, on the evening of 1 April, US President Donald Trump delivered a primetime address. His speech suggested the situation in the Middle East would escalate and dented hopes of an early end to the conflict.
As a result, when markets opened in Asia-Pacific, Europe, and the US on 2 April, they dipped.
Following news of a ceasefire agreement between Iran and the US on 8 April, the FTSE 100 was up 2.6%. Only three companies fell: oil companies BP and Shell, and British Gas owner Centrica. European stocks were also up – the pan-European Stoxx 600 index jumped 4%.
Yet, it didn’t take long for worries to emerge that a ceasefire would falter. On 9 April, concerns led to Asian and European markets falling again.
The soaring price of oil and the need to reroute some flights led to airline stocks being hit on 13 April when talks between Washington and Tehran broke down. IAG, the parent company of British Airways, was down 2%. Wizz Air (-6.5%) and easyJet (-3.8%) were also among those affected.
On 17 April, it was revealed that the UK government was considering ways to break the link between gas and electricity. The potential change would ease the burden on households and businesses, but could affect the profits of energy companies. When the FTSE 100 opened, it dropped 0.14%, with energy companies among the biggest losers, including SSE (-4%) and Centrica (-3.5%).
Later in the day, Iran announced that the Strait of Hormuz, an important waterway for trade, was now fully open. The news led to indices rising, including the Dow Jones (1.2%), the S&P 500 (0.7%), and the FTSE 100 (0.6%).
However, over the following days, there was uncertainty over a ceasefire and the accessibility of the Strait of Hormuz, which Iran declared closed. As a result, on 20 April, European markets fell when opening. Again, airlines were among the biggest fallers, while stocks in energy producers increased.
On 24 April, Trump threatened the UK with a “big tariff” if the UK did not drop its digital services tax on US social media firms. On opening, the FTSE 100 was 0.46% lower.
In contrast, Japan’s Nikkei closed on a record high thanks to earnings reports from the technology sector. In the week to 24 April, the index was up 2.1%.
The good news continued for the Nikkei when markets reoponed on 27 April. The index surpassed 60,000 points for the first time on the back of peace talks taking place between the US and Iran.
Data from the Office for National Statistics (ONS) suggests the UK economy was on a better footing than expected at the start of the year. GDP in February 2026 increased by 0.5% when compared to January.
Additionally, unemployment unexpectedly dropped to 4.9% in the three months to February 2026. However, wage growth was at its lowest level since 2020. Excluding bonuses, wage growth was 3.6%.
It’s important to note that these indicators were recorded before the conflict in the Middle East, which the International Monetary Fund (IMF) expects to harm the economy. The organisation downgraded the UK’s growth expectations for this year to 0.8%, compared to 1.3% it projected in an earlier forecast.
The economic shocks from the conflict could lead to higher mortgage repayments for 1.3 million households, according to the Bank of England. Potential increases in borrowing costs may also affect businesses.
A construction index from Glenigan suggests that activity in the sector has tumbled due to pressure from the conflict and a persistently weak economy. In the three months to March 2026, work starting on site declined by 17% when compared to the final quarter of 2025.
Similarly, S&P Global Purchasing Managers’ Index (PMI) data shows business activity weakening in the service sector. The PMI was 50.5 in March against a reading of 53.9 in February – a reading above 50 suggests growth.
The PMI for the manufacturing sector also highlighted the effect the conflict is having. UK factories were hit by the biggest month-on-month jump in costs since 1992.
Perhaps unsurprisingly due to ongoing uncertainty, a survey by YouGov and Cebr found that UK consumers are feeling gloomier about their household finances and job security. The survey recorded a reading of 105.8 in March, the lowest figure recorded since December 2023.
Inflation in the eurozone increased faster than expected. In the 12 months to March 2026, the rate of inflation across the bloc was 2.6%. There were significant differences between countries. Denmark reported the lowest rate of inflation of 1%, compared to 9% posted in Romania.
PMI data also indicates that while business activity is growing, it is weakening. According to S&P Global, the PMI reading in March was 50.7, which could suggest the economy is grappling with stagflation.
The ifo Institute reported that German business morale fell to its lowest level since the start of the Covid-19 pandemic in May 2020. Businesses are concerned that rising energy costs due to the ongoing conflict could derail the country’s economic prospects.
The IMF warned that Trump’s trade war would slow the US economy. The organisation said that imposed tariffs would offset the benefits of falling inflation. However, the IMF does expect the US economy to grow by 2.4% in 2026, compared to 2% in 2025.
The energy shock caused by the conflict has led to US inflation rising 0.9% in March 2026 when compared to the previous month. The rate of inflation in the 12 months to March 2026 was 3.3%, putting it above the Federal Reserve’s 2% target.
Figures suggest that the energy shock is already hampering businesses. Indeed, production at US factories, mines, and utility companies fell by 0.5% in March.
A survey from the National Federation of Independent Businesses also suggests that business sentiment fell to an 11-month low due to concerns about oil prices increasing.
To ease concerns over an energy shortage caused by conflict in the Middle East and the potential economic effects, Japanese Prime Minister Sanae Takaichi announced the release of additional oil reserves. It was hoped the move would head off a spike in energy prices.
China beat growth expectations in the first quarter of 2026. Data from the National Bureau of Statistics shows the country’s economy grew by 5% between January and March 2026, 0.5% higher than the previous quarter.
Following this news, credit reference agency Moody’s lifted its outlook for China’s government debt from negative to stable. The organisation said the changes reflect its assessment that the economy will be resilient to ongoing domestic, trade, and geopolitical challenges.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The 2026/27 tax year started on 6 April 2026. While you have until 5 April 2027 to use tax-efficient allowances and exemptions, making a plan now could be valuable.
Here are four powerful reasons to consider your tax strategy for the current tax year.
Using tax year allowances and exemptions is often associated with the end of a tax year.
However, leaving decisions until the last minute could mean it’s more stressful than it needs to be, and you might make a rushed decision that isn’t right for you. In addition, delays could occur, which means you miss the 5 April 2027 deadline.
Instead, using the start of the year to review decisions means you have plenty of time to assess what’s right for you.
If you have a lump sum to save or invest, using allowances early in the tax year means you could potentially benefit from additional months of interest or returns. When you consider the effect of compounding, you could be better off using some of your allowances now.
One option to consider is your ISA annual subscription limit. In 2026/27, you can place up to £20,000 into ISAs. You can choose to save or invest in an ISA to suit your goals.
Adding a lump sum to ISAs at the start of the tax year or drip-feeding contributions over the months could yield better results than waiting until April 2027, particularly when you factor in compounding.
Similarly, the pension Annual Allowance is £60,000 or 100% of your annual income, whichever is lower, in 2026/27. This is the amount you can add to your pension this tax year while retaining tax relief.
Your pension is usually invested. Depositing a sum now could mean your additional contribution has a longer period to potentially deliver returns and boost your retirement savings.
Remember that all investments carry some risk, and it’s important to understand what level is appropriate for you. Investment returns are not guaranteed, and you could lose money.
If you plan to dispose of assets, you might need to pay Capital Gains Tax (CGT) if you make a profit.
The Annual Exempt Amount means you can make up to £3,000 in gains in 2026/27 before tax may be due. Reviewing your options now could allow you to create an effective strategy for disposing of assets.
For example, if you have several assets to dispose of, you might spread the sale of them across the current and next tax years to use the Annual Exempt Amount for both years. Alternatively, you can pass on assets to your spouse or civil partner tax-free, which may allow you to use both your allowances.
Setting a plan early in the tax year means you have time to consider your tax position and goals, and adjust your plan if necessary.
Your personal circumstances will affect which tax allowances you may be able to use and your overall tax liability, which a financial planner could help you assess.
Over the course of the year, you might want to gift assets to loved ones. This could support beneficiaries and also make sense from an Inheritance Tax (IHT) perspective.
In 2026/27, the nil-rate band is £325,000. This is the amount you can pass on when you die before your estate might become liable for IHT. Fortunately, there are ways to mitigate a potential IHT bill, including passing on your assets during your lifetime.
Not all gifts are immediately outside of your estate when calculating IHT. Some gifts may be included in your estate for up to seven years, so making use of these allowances might be an important IHT strategy.
In 2026/27, gifting allowances include:
Reviewing your plans now means you can make them part of your budget and overall plan. It could also allow you to identify effective ways to support your family and friends.
Your financial circumstances and goals will affect which allowances and exemptions are appropriate for you. If you’d like to discuss how you might improve your tax efficiency in 2026/27 and work with us to create a tailored plan, please get in touch.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.The Financial Conduct Authority does not regulate tax planning, Inheritance Tax planning or estate planning.
Building wealth without a financial plan may be like searching for a destination without a map. You might miss the most efficient route, take an unnecessary detour, or miss your intended target altogether. A clear plan could be essential for helping you reach your goals.
If you’re simply accumulating wealth, your assets don’t have a clear structure. Seeing the balance in your bank account rise can be comforting, but you’re taking a passive approach.
In contrast, with a financial plan, your assets have an intentional structure designed with your goals in mind. As a result, the decisions you make are deliberate.
If the value of your assets is rising, you might assume you’re on the right track, but creating a financial plan is often still valuable.
1. Looking beyond the value of assets could paint a clearer picture
An increase in the value of an asset can feel like you’re on the right track to reaching your financial goals, but the number is only one part of the information you need to build a full picture.
Imagine you’re reviewing your pension and whether you’re on track for retirement. Seeing that you have £300,000 in your pension might feel good. However, that figure alone doesn’t tell you what income you might receive when you retire or when you’ll be able to step back from work.
A financial plan can help you understand what your assets could mean for your lifestyle now and in the future. It could also help you identify potential gaps and provide an opportunity to close them.
2. A financial plan may bring together multiple assets
One of the challenges of simply focusing on wealth is that you might view each asset in isolation. Often, you’ll need to bring together multiple assets to gain a clear idea of your financial health and what your options are.
Returning to the retirement planning example, you may use your pension alongside savings and investments to create an income. In addition, whether you may have debts, such as a mortgage, in retirement will affect the income you’ll need. So, if you only consider your pension, you may be missing essential details.
3. You could identify tax allowances and exemptions
Working with a financial planner could help you identify appropriate tax allowances and exemptions that might allow you to get more out of your finances.
Let’s say you’ve decided to invest £250 a month to support your long-term goals. Using a Stocks and Shares ISA could mean your potential investment returns are not liable for tax. As well as considering tax liability, keep in mind that all investments carry risk and you may not get back the full amount you invested.
Tailored advice might help you recognise how changes to the way you manage your finances could make them more efficient depending on your circumstances.
4. A strategy might help you measure the impact of your decisions
If you’ve not set clear goals and planned for them, it can be difficult to assess the impact of your decisions.
Working with a financial planner to create a cashflow model could provide a way to visualise your finances and how they might change over time. You can use this model to test different scenarios, so you might see the impact of adding money to your pension compared to overpaying your mortgage.
It’s important to note that the outcomes of a cashflow model are not guaranteed, but it can provide useful insights when you’re making decisions.
5. A clear plan could reduce impulsive decisions
Another benefit of understanding the effect of your decisions is that it could reduce impulsive or emotional decision-making, as you’re able to see the bigger picture.
If you’d like support in creating a long-term financial plan, we’re here to help.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate cashflow modelling or tax planning.
Once you have made an investment strategy, often doing nothing is the best course of action. Yet, it’s an approach that might be more difficult to stick to than you expect.
Investment markets often experience volatility, which could tempt investors to make decisions based on short-term emotions. These actions might not align with their strategy and could harm long-term growth.
Instead, trusting your strategy may yield higher returns over the long term. Indeed, a common financial adage is “the best investors are dead”. Rather than responding to news or short-term movements, inactive investors buy and hold assets.
On the surface, doing nothing seems like a simple investment strategy, but common financial biases can make it difficult to follow.
1. Action bias
A key bias that makes doing nothing challenging is action bias, which means investors favour taking fast, decisive steps over extensive planning.
As a result, doing nothing can feel negligent, rather than disciplined. Some investors might also experience a sense of lack of control if they’re not actively managing their investments. Consequently, you might feel as though you must do something, even if it could potentially harm long-term returns.
2. Loss aversion
Loss aversion theory suggests that investors feel the pain of a loss twice as intensely as the joy of gains. So, when markets fall, it can cause emotional discomfort that could push you to act. Doing nothing might compound your worries and make you feel as though you’re ignoring risks.
3. Recency bias
In many situations, people focus on the most recent events, including when considering investment performance. This is known as recency bias.
When markets fall, investors might expect them to continue doing so. This anticipation of further dips could lead investors to take action in an attempt to prevent further losses. While this might seem rational, if it’s not aligned with a strategy, it could turn paper losses into actual ones.
Similarly, recency bias could take hold when markets are performing well. When markets are up, investors might make financial decisions in the belief that the rally will continue, which could lead to some taking more risk than is appropriate for them.
4. Social pressure
Investors are exposed to constant social pressure, which could come from the news, social media, or friends. All these different opinions about what’s happening in investment markets and how you should respond could amplify the sense of urgency.
If you don’t react to social pressure, you might feel like you’re ignoring important information or missing out on a potentially lucrative opportunity. Again, it’s a form of bias that could prompt financial decisions that don’t align with your overall investment strategy or risk profile.
5. Present focus bias
Finally, present focus bias refers to the cognitive tendency to prioritise immediate rewards and the gratification that comes with them over long-term benefits. For investors, this can manifest as making adjustments to their portfolio in a bid to secure returns quickly.
Quickly turning your initial investment into a larger sum to help you reach your goals is an attractive prospect. However, for the average investor, investing should be approached with a long-term outlook that helps balance your goals with investment risk. As a result, the present focus bias could skew your perception of what you should be doing.
An outside perspective could help you identify when bias might be influencing your decisions. As a financial planner, we could offer this and work with you to create an investment strategy that’s tailored to your circumstances and goals. Please get in touch if you’d like to arrange a meeting.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
This guest blog was written by Chris Budd, who wrote the original Financial Wellbeing Book as well as The Four Cornerstones of Financial Wellbeing. He founded the Institute for Financial Wellbeing and has written more than 100 episodes of the Financial Wellbeing Podcast.
Ask small business owners when they plan to sell their business, and you invariably get the same answer: in five years.
Go back a year later, ask the question again, and the answer has typically not changed: in five years.
Five years is a time scale which is close enough to sound real, but far enough away to not have to do anything about it.
Unfortunately, this often means that when the time does come to sell the business, neither the business nor the owner themselves are ready for the sale. As a result, not only does the business not achieve the value they hoped for, but the owner very often struggles personally with the transition.
There are many business advisers out there who can help prepare a business for sale. But what about preparing yourself?
Here are a few tips on how to prepare yourself to sell your business.
I’ve asked this question of many business owners over the years, and the answer typically has two characteristics.
Firstly, it will be a figure such as £1 million. Now, I have a principle in life to never trust a round figure. Somebody who says their business is worth an amount like £1 million probably has not really looked into what the business is worth; they are guessing, often based on what they heard other businesses have been sold for.
Secondly, the question doesn’t ask the value of the business; the question asks what you need to sell it for.
This is where financial planning comes in. Most people think they have an idea of what they need for life after work. However, without a financial plan, this can only be a guess. When selling a business, this can be crucial.
If you think you need £1 million, but the business is only worth £500,000, then you might not be able to sell the business yet. If the business is worth £2 million, however, then you have options.
Key to this financial plan is understanding what life will look like after the business is sold. This is very often where things get especially difficult.
I once worked with a shareholder, founder and chair of a business, Davey Consulting Ltd (name changed). He was aged in his late 60s. He had no particular role in the business, but liked to pop into meetings and offer his opinion. Privately, the employees and executives shared with me that this was a real problem, but nobody wanted to tell him.
I asked: Why didn’t he just retire?
One answer was especially enlightening: “Because today he’s Bob Davey of Davey Consulting Limited. When he retires, he’ll just be Bob Davey.”
Business owners, and founders in particular, often feel defined by their business. They can find it extremely difficult to envisage what life might look like after the business is sold. Consequently, they do not take the first step in preparing themselves for the sale.
One objective of every business owner should be to make themselves the least important person in their business. After all, if you’re the most important person, then that business will be very hard to sell. Understanding what life looks like post-sale and finding a new role in life is a key part of this process.
Someone coming to the end of their career is likely to experience three characteristics in their working life:
Once the business is sold, these three things will go with the business. That financial plan, therefore, needs to start with consideration of how these aspects of their life will be replaced.
This process can take many years. An owner has often spent so much time building the business, investing so much of themselves, that seeing beyond the business to a different life can be very difficult.
Two tips, therefore, are to start early (about five years should do it!), and to get help. Preparing that financial plan should start with what life might look like post-sale, then work out how much is needed to achieve that life.
Once this financial plan has been formed, and the owner feels ready for the sale of their business, the preparation of the business for sale can really begin.
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
