Maybe your adviser is like the average adviser who listens to their client for less than two minutes before pulling out a product brochure.
Perhaps your adviser treats your money as the customer instead of you. What I mean by that is their primary focus is on maximising your wealth under their management and using tax minimising strategies to justify their recommendations.
Potentially they recommend locking your money away in illiquid, overseas or highly volatile assets to simply save on income or capital gains tax.
Possibly they explore strategies to minimise inheritance tax payable on death, when you want to see your family enjoy gifts while you are alive and they are young and in need of the money most.
Maybe they are simply wanting you to accumulate and keep funds under their management for as long as possible so that they can build their recurring revenues deducted as a percentage of your funds under their management.
What if your adviser got to know you first and asked you what would make an ideal life, and based their planning around that?
Here the goals you set are about you and what you want, then and only then is the financial architecture put in place to support your life plan in the most tax efficient way possible.
Here the primary focus is on optimising your life satisfaction. This may involve taking income, drawing down on capital or making gifts. Then your adviser explores the best way to do this from a tax perspective.
The adviser considers needs for liquidity, such as access to your savings early to suit a life plan. The adviser properly considers investment risk and geographical risk when exploring tax shelters, and the need for values-based investments.
Imagine this. Your adviser charges a fixed fee for the work they do. Without conflict of interest. Without incentive for keeping your life savings with them for as long as possible.
We're sure you would agree, if you feel you are being forced into someone else's plan and you would like to oversee your own, then you need a system you can trust.
Well, a non-intermediating tax planning system is that trusted process.
It's important because the conversation about your life must take place before the conversation about your money. That way, the plan is productive for you and your family. If it's done the other way around, if your money is looked at first, then the plan will be exhaustive or destructive for you. And, productive for your adviser. For example, maximising your pension pot can limit access to your life savings before age 55, or post age 55 there can be huge tax liabilities on large unanticipated withdrawals. Yet such strategies are highly profitable to financial intermediaries and their firms.
It is important because you need a lifetime cash flow forecast to model these scenarios properly. This is omitted when advisers just talk about their products. You could be very limited, restricted in your options, or risk losing money altogether in some "attractive tax saving strategies". Tax saving is important, but your life goals are far more important and must be considered first.
It's important because you want to be the primary beneficiary of your tax savings, rather than your adviser or their firm.
Some tax mitigating strategies are irreversible. For example, locking money into a retirement plan or gifting to a trust. Without a life plan you could be left with regrets. There again. If you don't consider tax implications, you could be looking at losing income, capital or lifetime/ death gifts to the taxman. The ideal plan is to look at what your money needs to do for you first, and then consider the tax mitigation planning.
For your initial no obligation consultation to review your financial planning requirements, please book via our Shop. The price is £45. Place your order today and we will contact you within two-working-days by phone or email to arrange an appointment at a time that is convenient for you.