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       CM12 9AJ

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Your Home is at risk if you do not keep up any mortgage or payments secured upon it!

You should remember that past performance is not necessarily a guide to the future. Market and currency movements may cause the value of units, and the value derived from them, to fall as well as rise and you may get back less than you invested when you decide to sell your units. The tax treatment of investments and pensions is not guaranteed and may change in the future.  

The yearning for a high income is quite normal, as all through their working life people desire a higher income to improve their lot and perhaps save for retirement. But drawing a high income can be very damaging to the value of your savings and your future.

If your income is more than your regular monthly expenditure, what are you going to do with any extra income from your savings? Save it for a holiday perhaps? But if your capital is already saved why take “income” out and then put it back again!

Many times we have met couples that are drawing the interest and dividends from Peps, ISA’s and deposit accounts and allowing the money to accumulate in instant access high street accounts. These accounts pay virtually no interest so why take money every month from an account paying say 4% gross and put it in a “high street” account paying perhaps nothing!

Provided that you have access to your capital (Say no to 90 day notice accounts!) then nine times out of ten you will not need “income” unless your regular bills are higher than your regular expenditure.  

The key to successful money management is a detailed budget, so you know where your money goes and a balanced portfolio of cash and shares preferably all tax-free. A good Independent Financial Adviser will look initially at a detailed budget and make recommendations to trim it accordingly before making suggestions about real investment and income levels.

For example do you know that a taxpayer needs £9,000 in a deposit account to rent a £30.00 a month TV & Video combination? (£30.00 x 12 = £360/4.0% x 100 = £9,000.) Surely it is better to buy the equipment for say £1,000 (or a lot less) and invest £8,000 for your future.

Think about what you actually need your capital or savings to do.

Firstly keep its value. Your Capital must grow each year by the rate of inflation simply to keep its purchasing power. To grow it must produce a return higher than inflation.

Secondly produce rising income either now or in future if required. Your bills will be larger in future than they are today. Rates, water sewage etc. will all increase over the years ahead. Interest rates are the same as forty years ago and cannot rise indefinitely so you must invest capital to produce rising income rather than rely on interest rates alone.