Monthly Archives

April 2024

Behind the scenes at FAS – part 2

By | Financial Planning

Many outside of our industry may not be familiar with the role of a paraplanner within a financial services firm. The National Careers Service defines a paraplanner as an individual that helps a financial adviser with technical and administrative tasks. Whilst this may be true, this definition barely covers the varied and highly skilled work undertaken by our own paraplanning team, which is integral to the continued success of the business.

Our paraplanning team

The FAS paraplanning team is office based and consists of seven staff split across our Folkestone and Maidstone offices. Boasting many years of combined industry experience, the team provide vital support in all aspects of the business, from report writing to financial analysis and calculations. We continue to strengthen our dedicated team of paraplanners to support growth in the business.

FAS paraplanners

It is fair to say that the paraplanners at FAS need to be skilled in several areas, as these various strengths are called upon daily depending on the nature of the job in hand. Primarily, the FAS paraplanning role is to compile client recommendation reports following adviser meetings. Working closely with the advisory team, our paraplanners have a major input in the preparation of the report letter, together with the collation of supporting documentation, such as illustrations and key features documents.

Our paraplanners often engage with clients in relation to reports that have been issued, and as a result, many FAS clients may well become familiar with some of our paraplanning team through direct contact.

A key element of the paraplanner’s role is to undertake the necessary research and analysis to support the recommendation being made to a client, involving the use of industry leading financial research software. The team often liaise with product providers to discuss how an investment is implemented whilst obtaining the necessary forms or documentation, as required.

As an independent firm of advisers, we can recommend financial solutions from across the whole of the market. Our paraplanning team take full advantage of our independent status when preparing recommendation reports by comparing a wide range of product costs and features, which are then discussed with advisers before completing the report.

Once a client proceeds with a recommendation, it is the responsibility of the paraplanner to check the returned signed documentation and notify our administration team of any important considerations, so that the implementation stage goes as smoothly as possible. There is ongoing daily communication between our paraplanning and administration teams to ensure adviser/client needs are adhered to and service standards remain high.

Qualified support

To ensure that the highest level of technical knowledge and support is given, all our paraplanners are at least Diploma qualified – the Chartered Insurance Institute’s Diploma requires the student to pass six examinations, covering all areas of financial advice, including regulation and industry ethics.

In fact, several of our paraplanners have reached Chartered status, which means that they have attained the highest standard of qualification in the industry. This helps demonstrate the importance we place on delivering the very best advice from highly qualified individuals.

FAS follow a strict regime of continuing professional development to ensure its staff keep themselves fully abreast of changes in legislation and reinforce their technical knowledge. Our paraplanning team are required to undertake a prescribed number of hours of learning each year, covering a wide range of topics. This ensures our paraplanners keep up to date with any changes in taxation rules, as well as regulatory requirements and compliance.

Meeting preparation

Our paraplanners often assist advisers in preparing the necessary documentation for a client review meeting. We provide a robust review service, and preparation is needed in advance of a meeting, so that an adviser has access to detailed performance return calculations and supporting evidence to aid discussion with a client. The paraplanner’s role here is not just limited to gathering and collating data, as advisers and paraplanners will work together to discuss financial planning opportunities that may require discussion at a client meeting, and the preparation of a meeting agenda.

Technical expertise

We often find that our clients have complex financial circumstances, where finding the right solution and strategy is key to successful financial planning. Our paraplanning team use their technical skills to prepare tax calculations, cash flow analysis and formulate strategic plans, in conjunction with the lead adviser, to ensure that the most appropriate recommendation is made to a client. Often specialist knowledge is required, for example where Trust planning or Inheritance Tax mitigation is the desired course of action.

Dealing with compliance

Compliance with regulatory requirements is a vital and necessary part of the role of a paraplanner. Our paraplanners need to ensure that recommendation reports are produced in a compliant manner, and that record keeping of the analysis and research undertaken to support a recommendation is correctly documented.

A team effort

The paraplanning team at FAS play a key role in the business, assisting advisers with key research, analysis, meeting preparation and the writing of recommendation reports issued to clients. Working in conjunction with our administration and adviser teams, our paraplanners also provide vital support to all other areas of the business, such as collating tax return information for accountants and portfolio details for probate cases.

We hope you have enjoyed this further look behind the scenes, and in the next and final part of the series, we will focus on our adviser team.

Later Life Planning – planning all the way through life!

By | Financial Planning

The last 25 years have changed the way we live. Now we can access information instantly, share experiences with people across the world, and reap the benefits of rapid technological change. These benefits include increased living standards and healthcare, and longer life spans. A longer life means your pensions and any other investment income in retirement have to last for longer; maintaining financial planning advice is more vital than ever to ensure you don’t outlive your income; and families may now stretch across more than three generations, making estate planning more of a challenge.

Financial planning for later life is, in many respects, the same as planning at earlier life stages. However, the emphasis will often change. For example, income will normally become a more important focus of investment than growth and planning for inheritance tax and potential care fees come to the fore.

Setting your goals

The first step in creating any plan is to decide what you want to achieve. There is no such thing as a standard, one-size-fits all solution – you need a personal plan designed around your goals. For example:

  • What should the balance be between maintaining your lifestyle and preserving what you pass on to your family?
  • Do you wish to stay living where you are today? Ultimately you may have no choice but to move to residential or nursing care, but in-home care can defer that transfer – albeit at a cost.
  • If you are still working, perhaps part time, how long will you continue to do so before fully retiring?
  • Are you prepared to rely solely on the NHS for your healthcare?

Careful income planning can be key to making the most of later life. Money concerns are never welcome, particularly if the opportunity to earn your way out of them is no longer open to you.

The transition from work to retirement is now often a gradual process. You might not want the instant change to 100% leisure time. Alternatively, you may need to earn extra income to cover a pension or other shortfall, perhaps because of the continuing increases in state pension age. Whatever your reason, national statistics show that men and women still work beyond their state retirement age. However, it is unwise to assume that you can rely on continued earnings for a long period of time. Factors such as your or your partner’s health, your enthusiasm, and the type of work you’re engaged in could mean you have to stop work at some point. If you think you will have to continue working indefinitely, then your non-retirement plans almost certainly need a serious review!

The role of pensions

Pensions, both state and private, are usually the main source of income in later life. For growing numbers of people, some pension income will be via income drawdown, rather than the traditional pension annuity. The drawdown approach offers flexibility suited to gradual retirement, but ongoing management is vital. The level of withdrawals needs regular review: taking too much from a fund can mean you outlive your pension, whereas the opposite could mean a lower than desired standard of living, thereby building up funds that your children, grandchildren or chosen benefactors will ultimately benefit from.

Investment management

What you require from your investments could alter over time and investment horizons naturally tend to shorten as you get older. For example, you may wish to increase the emphasis on security of income rather than income growth. To maintain a coherent approach, it is important to review your investments as a single portfolio, rather than as compartmentalised direct holdings, ISAs, life policies and pensions.


Income and tax sometimes seem inseparable, but this need not be the case. The flexible pension regime created ways to draw regular payments which are not fully taxed as income or are even tax free. Other investment structures can produce similar results if you think of your income requirement as a series of regular payments. For couples, tax savings can sometimes be achieved by simply rearranging who owns investments. The aim is to maximise use of an individual’s allowances and tax bands.

Long Term Care

Financial planning for social care is a highly complex area requiring specialist expertise. It had been made more complicated by the fact that, until September 2021, there had been no long-term plan for funding social care in England. Following new legislation, from October 2025 in England there will be an index-linked £86,000 cap on the total personal care costs (which excludes accommodation costs) that must be paid by an individual and capital limits will be raised for means-tested contributions, with the upper limit moving to £100,000.

Planning the future of your estate

You should ask yourself, what do you want to happen to your estate? That question affects more than inheritance tax (IHT) planning. Your estate and IHT are inextricably linked, but the most IHT efficient planning may not be ‘family efficient’ estate planning.

Protecting assets during your lifetime

The current and, to a lesser extent, future funding rules for long-term care can result in your estate being whittled down to pay care home fees. The average stay in a residential care home in England is around 30 months and average fees can exceed £1,200 a week in some parts of the UK. It may be possible to plan your affairs to limit the cost, but this is an area where in-depth knowledge is vital, and many dangerous myths exist – such as ‘just give it all away first’. To mitigate IHT, you should consider not only your will, but also any opportunities you have to make lifetime gifts. Today’s IHT regime has a favourable treatment for lifetime gifts. For example, outright gifts made more than seven years before death are completely free of IHT, as are regular gifts, regardless of size, when made out of income, provided that they do not reduce your standard of living.


Trusts have long been used as a way of controlling lifetime gifts or legacies after they have been made. For example, a trust could be used to provide income from a portfolio for a surviving spouse, while also ensuring capital passes to children from a previous marriage when the surviving spouse dies. Trusts have often been associated with tax planning, but over the years legislation has been tightened. Now, most trusts are subject to the highest rates of income tax and capital gains tax, meaning that they can be disadvantageous from a tax viewpoint. Nevertheless, trusts continue to have a role to play, particularly when the would-be recipients of a gift or legacy are minor children or young adults.

Generation skipping

A five-generation family is a real possibility today, thanks to increased life expectancies. This can create some difficult estate planning decisions. Purely from an IHT viewpoint, the best option is to pass assets straight to the youngest generation, avoiding the tax that might otherwise be incurred on the trickle down through generations. However, the generations overlooked by such a strategy may be more in need of funds than their children or grandchildren. There might even be an expectation from the older generation of support with their care costs. As with so many other areas of later life planning, compromises may be necessary and sound advice essential.

How we can help

Later Life planning can be complicated with conflicting goals and uncertain timings. However, our experienced financial planners can provide advice on the following areas, so you are not alone. Please do get in touch if you wish to discuss any of these in more detail:

  • IHT and estate planning
  • Managing your pension arrangements
  • Your options for funding long-term care
  • Identifying opportunities to reduce your income tax bill
  • Managing your investments, including pension assets
  • The costs of downsizing and the alternatives available to you.

ISA rules refreshed

By | Savings

Launched as the follow-up to the Personal Equity Plan (PEP), the Individual Savings Account (ISA) has just reached its 25 year anniversary. Prior to the start of this tax year, ISA regulations have remained largely unchanged for some time. The updated ISA rules taking effect from 6th April 2024 will, however, lead to greater choice for savers and investors, further reinforcing the benefits of using your ISA allowance.

ISAs provide a tax-free wrapper in which any income earned is exempt from Income Tax, and in the case of Stocks and Shares, any gains are free from Capital Gains Tax. There are five types of ISA, with Cash ISAs and Stocks and Shares ISAs being the most well known. The Lifetime ISA and Innovative Finance ISA are less popular, and the fifth ISA, the Junior ISA, is only open to those under the age of 18. The maximum an individual can save in an ISA in any tax year is £20,000, and the subscription can be split across the different ISA types. The Junior ISA has a £9,000 subscription limit.

There is no facility to carry forward unused ISA allowances, and therefore it is important to make regular use of the allowances as they become available each tax year.

Split your ISA across providers

Until 5th April 2024, the ISA rules restricted an individual to opening just one ISA of each type in a tax year. These restrictions have now been lifted, and you can now invest in multiple ISAs of the same type, in a single tax year. For example, you could split your ISA subscription between a fixed rate Cash ISA with one bank or building society, and a variable rate Cash ISA with another institution. Similarly, you could split a subscription into a Stocks and Shares ISA across different ISA providers. The new freedom does not, however, extend to Junior ISAs or Lifetime ISAs, where the single provider per tax year limit remains.

Less restrictive transfer rules

The ISA rules on transfers have been relaxed to give investors more freedom and choice. Before 5th April, partial transfers of ISA money paid in the current tax year were not permitted – you had to transfer the whole ISA balance. You can now make a partial transfer of money that is subscribed in the same tax year. For example, you could invest £20,000 into a variable rate Cash ISA, and later in the tax year, partially transfer £10,000 of that subscription into a Fixed Rate Cash ISA.

Loophole for 16 and 17 year olds closed

The new legislation has closed the loophole that has previously allowed those aged 16 and 17 to save £29,000 tax free each year. Under the old rules, the minimum age for a Cash ISA was 16, which allowed someone aged 16 or 17 to subscribe £20,000 into a Cash ISA and £9,000 in a Junior ISA, which is open to those under the age of 18. The rules have been tightened, with only those aged 18 or over now being able to open a Cash ISA.

British ISA

Many clients have asked us for further information on the British ISA, which was announced in the Budget statement last month. The statement confirmed that the British ISA would provide individuals with an additional ISA allowance of £5,000, on top of the existing ISA allowance, which could be used to invest in UK companies. The eligibility rules for the British ISA are yet to be announced, and the Government are currently engaging in a consultation period with the industry, which is set to run until 6th June. Whilst it remains a possibility that the British ISA will become available later in the current tax year, it is far more likely that the allowance will not become available until April 2025.

NS&I Bonds

Another of the announcements in the March Budget was the latest round of National Savings & Investments (NS&I) savings bonds. The new issues have been labelled as “British Savings Bonds”, but in essence they are simply a new moniker for the Guaranteed Growth and Income Bonds. These are long established savings products, where all income earned is taxable.

The new issues do not offer anywhere near the market leading rate of interest offered on the last round of Bonds, which were only available for a short period last Autumn. The new British Bond issues are both fixed for a 3 year term, and the interest rate payable (4.15% per annum on the Growth Bond and 4.07% per annum on the Income Bond) is uncompetitive when compared with similar fixed rate bonds offered by Banks and Building Societies. The only real positive factor to consider is that the products are backed by the Treasury and therefore offer greater protection than the standard £85,000 Financial Services Compensation Scheme (FSCS) protection limit.

Time to review existing savings

With the new tax year upon us, we feel this would be an ideal time to reassess your existing savings arrangements. Cash interest rates have been higher over the last 12 months than they have been for some time, although we expect that UK base interest rates will begin to fall later this year. As a result, it may be a good time to consider the level of savings you hold and whether surplus savings could be more productively invested in other assets, such as Equities or Corporate  Bonds. Speak to one of our independent advisers to carry out an assessment of your existing cash savings, and to make sure you are making best use of your ISA allowance.

The value of independent advice

By | Financial Planning

Whilst it is a topic we have covered previously, we make no apology using this week’s Wealth Matters to reinforce the benefits of independent financial advice, and potential pitfalls when using a restricted adviser.

Understanding the difference

Financial advice can be provided on either an independent or restricted basis; however, many people may not immediately understand the difference between the two. Firms need to clearly inform clients whether they offer independent or restricted advice when engaging with a client; however, many restricted firms do not do this, and thus mislead clients.

Independent financial advisers (IFAs) are not tied to any specific financial products, providers or investment institution, so they can offer impartial advice tailored to their client’s needs. In contrast, restricted advisers can only recommend certain products and solutions from a very limited range of options, and in some cases, will only be able to recommend products from a single provider.

Using a restricted financial adviser doesn’t necessarily mean you’ll be getting ‘bad’ advice, as all financial advisers must have a similar minimum level of qualifications and meet the same standards. It does, however, mean that the choices available as a client of a restricted firm may well be limited, which may lead to missed opportunities, or a sub-optimal solution.

At FAS, we choose to be completely independent so that we can research and recommend financial products spanning the whole of the market. In doing so, our advice is unbiased and unrestricted. We are very proud of our independence, and our ability to recommend the most appropriate product or service from across the marketplace helps us to achieve our aim of providing the best advice to clients.

Value for money

Some may make the mistake of assuming a restricted adviser will offer better value for money, as they perceive the amount of work undertaken in recommending a product from a limited range will prove more cost effective; however, this is not the case, and in our experience, the opposite is found to be true. We often meet new clients who have received advice from a restricted firm, and when undertaking unbiased cost comparisons, the restricted firm prove to be expensive compared to the cost of independent advice. One factor is our ability to look across the whole of the investment market and potentially access more cost-effective options that may not be offered through a restricted adviser.

What independence means to FAS

To help demonstrate the importance we place on our independent status, we look at three key areas where our day-to-day advice is enhanced by our independence.

1. Independence in fund selection

The UK fund management industry continues to grow in size with around 3000 funds being available to UK retail investors, covering both active and passively managed fund solutions across the widest range of asset classes, sectors and geographies.

Being an independent firm affords us complete freedom in the investments and funds we recommend are held within client portfolios. The FAS Investment Committee always take a wholly unbiased view when it comes to fund selection, selecting the most appropriate funds from across the whole of the market, without restriction. Comprehensive research and analysis is undertaken on all investment funds available to UK retail investors every quarter, and where funds pass our filters, we engage with fund managers to carry out more detailed analysis.

Funds that we currently recommend to clients need to fight for their place on our recommended list at each quarterly review. In the event that a fund underperforms, we discuss performance with fund managers, and have no hesitation in removing a fund from our recommended list if we feel better prospects lie elsewhere. Our focus on strong fund performance, together with our desire to access competitively priced solutions, can help our clients meet their financial goals, such as saving for retirement, more quickly.

2. Independence in product selection

As an independent firm, we always look to recommend the most appropriate product provider from across the whole of the marketplace. We undertake a regular whole of market review of platforms and product providers, considering factors such as platform cost, service levels received and changes in product features. This whole of market approach means that we can feel confident that the recommendations made to our clients are based on a comprehensive review of the full range of options available.

In a similar manner, we monitor and regularly review platforms that have been recommended to clients, and should a more appropriate solution become available, we have the ability to recommend that the client moves to a platform that provides lower costs, or improved levels of service.

3. Independence in financial solutions

A key benefit of our independent status is the ability to take a totally unrestricted view as to the solutions that would best fit an individual client’s circumstances. This is a particularly important element that supports our holistic approach to financial planning. For example, for those in later life, we are able to recommend esoteric investments, such as business relief solutions for inheritance tax planning, and for individuals who are seeking a high degree of tax efficiency, we can look across the range of Venture Capital Trust, and Enterprise Investment Schemes, if appropriate, given a client’s attitude to risk and objectives.

Why independence matters

We are very proud of our independent status, which we feel allows us to provide the best advice by being able to recommend products and solutions from across the whole of the market. If you currently receive advice from a restricted adviser, you may not be receiving poor advice; however, it may well be sensible to consider the limitations under which the adviser is working.

For example, the limited range of fund options offered by a restricted adviser could lead to underperformance, when compared to recognised benchmarks and peers. Given our experience, it may also be wise to review costs and charges, to see whether the restricted adviser is offering good value for money. Speak to one of our independent advisers, who are happy to take an unbiased and impartial review of your existing financial arrangements.