All I want for Christmas is…….?/2010

All I want for Christmas is…….?/2010

First of all, I would like to thank our clients and enquiries for their business over the course of 2010 and the team at Churchouse Financial Planning Limited look forward to serving you further in 2011 and beyond.

The year of 2010 and beyond…

In reflecting on the year, it seems a long time ago since a night’s sleep was lost for the General Election and the hazy summer days of the World Cup. Snow seems to be a rather too regular feature of the year at both ends and of course, ‘Austerity’ was another buzz word that we have all endured and are likely to endure for some months to come. With the VAT rise from 17.5% to 20.0% due to appear on the 04^th January and Bank of England base rates seemingly frozen (excuse the topical pun) at 0.5% savers and borrowers will feel the effects of these issues in 2011.

Inflation has also to figure in these thoughts and the Consumer Proces Index (CPI) rose to 3.3% in November 2010 (from 3.2% in October), with a continued target of 2.0%.

Christmas spending and debt

Before we get to the New Year, Christmas is nearly upon us and many will feel the financial stress of funding what can be an expensive period. Clearly, this year will see the availability of credit potentially reduced and this may well be a good thing in keeping debts under control. As most are aware, the bills for credit cards usually arrive around the 20^th January in the following year and this needs to be borne in mind when you are queuing at the till this month. Remember, many employers pay staff early in December to meet the demands of the extra Christmas costs, which means that you then have around 6 weeks before you are paid again.

Protecting the family

This leads me to think further about other issues for financial planning. I am not referring to buying a pension policy for your spouse for Christmas , as noted in my book, Sign Here, Here and Here!…Journey of a Financial Adviser. I am referring to other issues to protect your family, such as making sure your life assurance planning covers your liabilities, such as mortgage and loans, leaving some excess to ensure that your family has some cash in the event of your death. If your employment offers benefits, such as death in service cover, then make sure that your nomination in the event of your death is correct and documented accordingly.

Protecting income and capital

Also, you should think about protection of your income in the event of a critical illness or inability to work due to ill health. This can be covered by plans such as Income Protection plans (sometimes known as PHI cover) or, as a compliment to this type of cover, a Critical Illness type cover. Again, you employer may protect your income if you are unable to work, but you should check this with your HR department. You don’t want to find out too late that you are not covered. The premiums for both types of plan vary and will be affected by your medical circumstances, age, sex and other things, such as smoker status or occupation. These types of cover are subject to medical underwriting and this can take a little while to arrange. If you are planning to start cover in the New Year, you might want to start the application process early to make sure you have time to ensure cover is ready for you.

Take advice

Talk to an Independent Financial Adviser (IFA) to help you understand your existing cover and, as the title of this blog suggest, what you want (maybe not just for Christmas!)

We are all different and therefore, this article should not be seen or used as individual advice. Seek Independent Financial Advice for your circumstances.

Further details of the book and our service are available at our websites, www.signherehereandhere.co.uk or www.churchouse.com

Keith Churchouse, Chartered Financial Planner

ISO22222 Certified Financial Planner

Director of Churchouse Financial Planning Limited

Churchouse Financial Planning Limited is authorised and regulated by the Financial Services Authority. The Financial Services Authority does not regulate taxation advice.