KELLY CLARKSON - ListedMagazine.com

MONEY TALK
You could save yourself
£1,000s with the right
fi nancial advice, as
Ali Wood discovers
“
With the right
fi nancial advice
our future should
be plain sailing.
Scared by fi nance? Me, too. The
last time I received fi nancial advice
was when my mortgage lender
congratulated me on my engagement,
swiftly followed by a Booker prizewinning
depiction of my life as a
widow...(would you be needing life
insurance with that madam?). The time
before that I was in school uniform,
working out how many GSCE A-grades
would get me a pool table. So, with
scant fi nancial knowledge built on
the foundations of threats and bribes,
I wondered, as I approach my 30th
birthday, what it would be like to take
independent fi nancial advice.
I contacted Lewis Innovative
Investment, which provides
independent advice on everything from
investment and savings to pensions,
life assurance and mortgages. I
invited them to our home to look at our
fi nances, to see how we could get rich
quick...or at least learn to be a bit wiser
with our savings.
Our objectives, I explained over a cup
of tea, were to build wealth in the form
of investment properties and take
advantage of tax reliefs and savings.
James also added that he’d like to retire
at 45 on an income of £50,000. Nice...but
realistic?
Lee and Steve assessed our attitude to
risk, looked at our current savings and
investments, and discussed topics we’d
so far managed to avoid such as wills
and pensions (surely we’re never going
to get old and die?) Here’s what we
discovered:
Protection
I don’t have life and critical illness
cover, which could be tricky now that
I run my own business, should the
worst happen. It would cost James and
me £37 a month for joint cover, which
would pay out £75,000 on diagnosis of
most critical illnesses, and £134,000
in the event of death. For comparison
purposes, we’re talking the equivalent
of Sky Sports, Broadband and Talk...
tough call.
Savings and investment
We’ve talked about raising £200,000
in the next fi ve years for a business
venture. We wondered if entering the
buy-to-let market might be a good way
to ‘build wealth’ before then. Steve and
Lee pointed out that this would mean
48 www.listedmagazine.com
”
paying interest on the entire amount we
borrowed to fund it. A good alternative
would be to use cash ISAs, and raise
capital when we need it, against equity
on our own property, possibly switching
to interest-only.
Tax savings
This came as quite a surprise. James
has no pension, but his salary package
means that he could benefi t greatly by
taking one out. We learned that if he
were to credit a portion of his earnings
to a pension, he could obtain over
£1,000 a year in tax relief for the cost of
£1,600... meaning more money for that
Caribbean SAGA cruise!
As for myself, I have £6,000 in a Money
Purchase pension scheme where my
previous employer matched my own
contributions and the funds were
invested by Fidelity. Steve and Lee
approved of the scheme but suggested
I shifted the balance of the portfolio
in line with my current attitude to risk,
which is more conservative than it was
six years ago.
Wills
Steve and Lee revisited the topic of
wills decidedly more tactfully that my
mortgage lender had. Now that James
is retiring on £50k a year, I felt this was
a much sunnier proposition.
Conclusion
Steve and Lee started with our goals
and worked backwards exploring ways
to help us achieve them. We learnt so
much more than we could go into detail
here, and in the 15-page report that
arrived the next week, we discovered
ways to save and invest, that I’m sure
will prove useful for life. They spoke
English, not legalese, and I even
enjoyed reading the report, which isn’t
bad for a fi nance-phobic!
This review and the accompanying
fi gures are in respect of Ali and
James’ situation only and should not
be taken in a wider context. If you’d
like a fi nancial review, contact
Stephen or Lee, at Lewis Innovative
Investment, 41 Commercial Road,
Poole, Dorset BH14 0HU.
Tel: 01202 718400 or
www.lewisinvestment.co.uk.