Welcome to our February newsletter

David's humbling charity trip to Rwanda

David Hughes, Partner and Compliance Officer at Anderson Lloyd, has been humbled by his fact-finding mission to a ground-breaking centre for disabled children in Rwanda.

He travelled to the Komera Centre, Mushubati, Western Province, in his role as Chairman of the International and Foundation Committee for the Rotary Club of Truro Boscawen.

The eventual aim is to raise money, through Rotary, to improve the infrastructure of the centre, particularly toilet and shower facilities. Currently, children in wheel chairs have to be bodily lifted into the showers and as they get older this becomes more and more undignified. There is also a plan to make the water supply more sustainable, since most of the water tanks are failing and to introduce a biodigester using the methane created to cook with rather than using charcoal fires.

The Komera Centre is an innovative project which has been used as a blueprint for others in the country. It was established in 2007 and now has 72 boarders and 70 day students who come from all over the province and are taught working skills - gardening, textiles and building - together with communication skills. Parents are also taught communication skills.



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Lloyd's and Which? pull back from giving protection advice
 
It's been revealed that Lloyds will no longer offer standalone advice on protection products - which puts at risk some 1200 jobs within the organisation. Which? has decided not to advise its members.

Giving advice has become far more complex. Changes to the regulatory system means that it's a job that has to be done thoroughly and for large organisations a lot of work has to be undertaken for an unsubstantial return (in the eyes of the larger institutions). There's also the cost of training advisers and retaining them - precisely the reason why the big players of the past pulled out -  for example, Abbey Life, Hambro Life and so on.

Is advice needed? Isn't it possible to go online and buy protection products - life insurance, critical illness, etc.

It is possible. But which plan, how much for and should it be written in trust?

Good to talk to an independent financial adviser.

Pre election savings boost

Significant among the casualties of the 2008 crash and resulting low interest rates have been the many people who are cautious - and prefer to put their money on deposit, rather than take risks in the financial markets.

Now, several months before an election, the Chancellor has offered them some hope with National Savings Bonds at 4%.

Prior to this announcement, it meant tying up funds for three to five years to obtain somewhere nudging 3%.

Like all headline rates it sounds good, but do remember that you have to wait a year to obtain the interest. So if you're looking for monthly income, it's not ideal and you will be taxed at your highest marginal rate on the interest. That means for basic rate taxpayers 4% becomes 3.2% - a smidgeon above what you could obtain before.

Investing and Tax Planning go hand in hand

Look in the window of your local bank or building society and they will be advertising their best rate of interest - the bait to lure you in.
 
Now if the rate they are describing is their latest ISA offering - and providing it’s not a bond that locks you in for a period after the teaser rate has expired, it’s worth looking at.
 
Other than that, your deposit account is taxed at your marginal rate. In some circumstances it can be paid net of 20% tax. So a rate of 0.5% is in effect 0.4% after tax. If inflation is 1%, your money is worth minus 0.6%
 
The market place has a number of different tax wrappers to consider.  They’re just that – a blanket wrapped around your money against the cold winds of taxation.

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Everyone's circumstances are different, so why not work with a Financial Adviser at Anderson Lloyd and explore all the options available - and what's right for you!