Virtue Money Blog 2019

VIRTUE MONEY
BLOG

2019 Edition

© 2019 Virtue Money

Contents

WOMEN AND RETIREMENT

• Pension Provision
• Tips for retirement saving
• Guidance websites

CASHFLOW MODELLING
FINANCIAL ADVICE – WHAT’S THE COST?

• Introduction to an Independent Financial Adviser
• Common Financial matters we can help with
• Understanding fees

BUSINESS PROTECTION – WHY YOU MIGHT NEED IT

• Covering your greatest business asset – You
• Business types and different business protections
• Key points to consider

PENSIONS – DO YOU KNOW WHERE ALL YOUR POTS ARE?

• Pension Dashboards
• Methods to track down your pension pots
• What to think about once you have located all your pots

THE NEXT GENERATION AND THEIR FINANCIAL QUESTIONS

Through the eyes of our very own Paraplanner Susan Ralston

CONTACTING VIRTUE MONEY
VIRTUE OUT AND ABOUT

WOMEN AND RETIREMENT

Pension Provision

Both Aegon and Scottish Widows have recently conducted surveys to see where women
are, regarding their pension provision. Unfortunately, the findings of the surveys prove
grim reading as both show that women are woefully under prepared for their retirement
compared with men!

Aegon’s study found that 15% of women have no pension provision at all compared with
11% of men and that women are half as likely as men to be confident about their ability
to have a comfortable retirement.

Although, this year’s Scottish Widows report findings are encouraging as they show that
women are starting to save more for their retirement with autoenrolment really helping
to highlight to both women and men the need to save for retirement. However, the
report also shows that the narrowing gap is happening slowly and in part can be
attributed to the fact that the number of men saving enough is in decline.

Aegon’s survey findings echo a 2017 AJ Bell survey which found that on average women
are retiring with a pension pot of around £59,000 which is around two fifths of the
average men’s pension pot of £143,000.

Tips for Retirement Saving

Here are some of the reasons for this pension gender disparity;

• The gap between women’s and men’s pay mirrors the retirement savings gap,
lower pay equals lower retirement savings.

• Women may have breaks in their careers or reduce their working hours to have or
look after children.

• Women may also take breaks or reduce their working hours to care for elderly
relatives.

So, how can women concerned about their lack of retirement saving go about tackling
this issue?

The best way is to have a plan and ask yourself questions like;

• How much do I need in retirement to cover my essential expenses?
• Find out what your State Pension Entitlement is, you can do this by visiting the

Government Pension Service website.
• What pensions do you have? If you’ve had several employers throughout your

working life you might have old pension schemes with them. Have a look through
your paperwork or contact your old employers directly to find out what you have
and where.

• Do you want to consolidate all these old “pension pots”? This may help you keep
track of your pension savings and could save you money on charges? It’s always a
good idea to seek financial advice before doing this though, to make sure it is
actually the best option for you.

• If you can then put a plan in place to begin increasing your pension contributions.
If you are finding money tight then why not consider putting your bonus in as a
one-off contribution or increase monthly contributions if you get a pay rise!

• If you’re in your employer’s pension scheme, then check it out. What fund is the
scheme’s default? Remember this is your money and you do have a say in where it
is invested.

• What other assets do you have, do you have property or savings? These together
with your pension pot(s) might mean you are in a better retirement position than
you think.

Guidance Websites

If you want guidance on pensions, then there are several websites you could look at;

• Pension Wise
• The Pension Advisory Service
• Unbiased

If, however you feel that you would like some financial advice on your pension (or
investments or protection for that matter) then please either call us on 0345 034 3424 or
email [email protected] and we can make an appointment with one of our
advisers. The first appointment is free of charge and no obligation, so you have nothing
to lose.

New Talent Awards 2019

Congratulations to our Marketing Coordinator, Eilidh, for being selected for the
finals of the Professional Adviser New Talent Awards 2019 for Social Media
Personality of the Year! These awards are to celebrate the emerging talent in

financial advice - recognising and identifying the sector's future leaders as well as
shining the spotlight on the organisations and individuals that are helping develop

and foster new talent in the industry.

CASHFLOW MODELLING

How much money do you need?
You may know your current income and expenditure and have a clear understanding
regarding your immediate financial situation, but what about next year, the following

year, 10 years’ time or retirement?
What do you know regarding your financial behaviour that will affect the rest of your

life?
These are the questions that will affect your financial stance.

AT VIRTUE MONEY WE BELIEVE THAT CASHFLOW MODELLING IS A FANTASTIC WAY TO
PLAN YOUR RETIREMENT.

So, what is Cashflow Modelling?
We input detailed information supplied by you into our software system and can build in
various “what if” scenarios; what if the children go to university? What if we pay off the

mortgage early? What if we want to go on that once in a lifetime holiday? Cashflow
Modelling helps to identify a course of action needed to ensure that your financial future

isn’t just pie in the sky.
Cashflow modelling helps you shine a light on your goals and objectives and gives you a

clear understanding on your finances to give you a brighter future and help you
understand ‘How much’. Essentially, it’s about helping you enjoy the best possible life

with the money you have.

FINANCIAL ADVICE – WHAT’S THE COST?

There will be times in your life when you need to think about different financial products
to suit different financial situations. That’s where an Independent Financial Adviser firm,
like Virtue Money, comes in. We can guide you through the process and give you advice
to help you make the right decision about the most suitable product(s) for your situation.
Introduction to an Independent Financial Adviser
As Virtue Money is an Independent Adviser we can advise on, and sell products, from any
provider right across the market. This means that we’re not restricted to certain products
and providers and can give you a bespoke solution tailor-made to you and your situation.
Whilst the advice will not be free and there may be “Robo-advice” options available,
however, if your situation dictates a complex product, even the people that you would
say are “money-smart” see that there is an intrinsic value in paying for advice to make
sure that the right product is chosen in any given situation.

Common Financial Matters We Can Help With

The most common financial matters that we can help with are Annuities, Life Insurance,
Critical Illness, Income Protection, Pensions and Investments. It should be noted,
however, that this is not a comprehensive list and there are many more products and
situations that we deal with on a daily basis.

The first consultation is free of charge and you are under no obligation to use us if you
don’t feel like we’re a good match. It is always a good idea to come to the meeting with a
summary of your financial situation, things like any savings or debts you have, details of
existing plans and pensions, a rough idea of your income and expenditure and what your
future plans look like.

Having a list of questions that you might have about your finances is also a fantastic idea,
remember “there are no silly questions”.

Understanding Fees

If you would like to proceed down the advice route after the initial consultation, then
there several ways that the fee will be worked out depending on your situation;

• Percentage Fee – this is a percentage of the money that you want to receive
advice on or have managed.

• Fixed Fee per service – if you prefer to deal with us on a transactional rather than
an ongoing basis then this might be the option for you.

• Hourly Rate – Depending on the situation this option might be a more favourable
one for you where instead of taking a percentage we would look at the cost of the
advice on an hourly rate basis.

Please bear in mind, we will also discuss the matter of the cost with you and you
will never be hit with an unexplained bill for our services.

I suppose the question that you now need to ask yourself is “Can I afford not to
have advice?” If the answer is no, then please do not hesitate to contact us and
we can arrange a suitably convenient time for your initial free consultation with
one of our Financial Advisers.



BUSINESS PROTECTION – WHY YOU MIGHT NEED IT

Covering Your Greatest Business Asset – You

If you are a business owner and employ staff, you will have insurance to cover your
employees if they have a workplace accident. If you have a factory or office, chances are
you will have insurance on these.

However, you may have forgotten about protecting your most important assets – you as
the owner or people key to your business.

Not enough businesses take time to consider, and indeed, seek cover if a key person in
the business falls ill (including critical illness) or dies.

What would happen to the day-to-day running of your company? Would your income
take a hit If a key person is affected?

Could you repay business debts or afford to pay the surviving spouse, of the key
member, the value of the business owned by the Partner or Director?

Business Types and Different Business Protections

There are different types of businesses, all of which need protection, however, not all
businesses need to protect the same things:

• Limited Company –You may have a business loan, loan account or a business
overdraft which would need to be protected.

• Limited Liability Partnership and Partnerships – Do you have key people who
contribute to the success of your business?

• Sole Traders – Although you cannot own property or plans (these would be
owned by the individual owner), what would happen if you or a co-owner were to
suffer a serious illness or die?

People who are self-employed generally find that their business and personal finances
are often interdependent. This means that you would look to protect yourself and your
family. This could mean looking at Business Protection, Income Protection and Life
Insurance.

Key Points to Consider

If you are a Director or a Partner in a business, you would look at business protection to
bridge the gap should you, your partner or other directors fall ill or die. How could you
afford to recruit someone qualified to take on the role of the key person?

What if you already have personal protection? That’s great, and it means that your family
would be covered in the event of your death, disability or critical illness. But what about
your business? If you could no longer work because of a disability or a critical illness how
would your business cope and if you could go back to work afterwards would there still
be a business to go back to?

Dragon’s Spine

Virtue Money are proud to be Gold Sponsors of the Larbert and Falkirk 41 Club Take
on the Dragon’s Spine. The team of 14 men, took on the Dragon's Spine on the 30th
May - a 420-mile cycle round the coastline of Wales for Alzheimer Scotland, taking a
massive 5 days to complete! Amongst the 14, was our very own Adviser, Grant. The

team managed to raise a total of £22,115!

PENSIONS – DO YOU KNOW WHERE ALL YOUR POTS

ARE?

The government is currently consulting on proposals for a new pension dashboard to
enable pension savers in the UK to view all their pensions under one online login.
According to the Pension Dashboard Prototype Project, during our working lifetime, the
average adult in the UK may have up to 11 different jobs. This means potentially 11
different pension pots which may be why they also estimate £400M of pensions monies
are unclaimed.

Pension Dashboard

The Secretary of State for Work and Pensions, Amber Rudd, sent a written statement to
Parliament in April 2019 advising that the Government expected to see the first workable
models of the Pensions Dashboard developed and tested in 2019. Although pension
schemes will be given 3-4 years to get the data of their members ready for inclusion on
the Dashboards.

Rudd added that the dashboard project would eventually “enable people to access their
pension information in a single place online, in a clear and simple form”. Industry experts
have suggested that the benefits of the Dashboard could be that we:

• Have a better understanding of our likely finances in retirement, based on our
current situation

• Have a clearer grasp of the need for financial advice
• Be motivated to increase our pension contributions
• Have more inclination to take a proactive role in managing our potential

retirement.

Until the dashboard comes into play though, where are your pension pots? Have you lost
track of some?

Methods to Track your Pension Pots

The Money Advice Service website has a myriad of advice on how to track down old
pensions. You could write to your old employer or provider (if known) and there are
templates on the website to help you do this.

Both employers and providers can change their names making it difficult to trace them. If
this is the case, you could try the Pension Tracing Services. It’s a free service which
searches a database of more than 200,000 workplace and personal pension schemes to
try and find the contact details you need.

Once you’ve located all your pension pots what do you do with them? How have they
performed? What are the charges on each of the plans?

What to think about when you have located all your pots

You might be thinking of merging multiple pension pots into one and there can be
potential advantages of doing this.

You can keep track of and manage your pension savings more easily, it might save money
if you can transfer from higher-cost schemes to a lower-cost one and open the possibility
of a greater choice of investments.

Unless you’re confident that you understand the costs, benefits and risks involved then
you will probably want financial advice on this matter.

FDAMH (Falkirk and District Association for Mental Health) is Virtue
Money’s Charity of the Year 2019. FDAMH is a Mental Health
Charity that promotes mental wellbeing by providing a range of
services and creating a safe and supportive environment to all who
require support.

Established in 1981, their vision is to be regarded as a centre of
excellence at providing services, training and education in relation to
mental wellbeing and contribute to the work of reducing the stigma
and discrimination commonly associated with mental ill health.

The charity supports individuals to recover from mental ill health by
acknowledging that recovery is a unique voyage of self-discovery
and personal growth, prevent deterioration in mental wellbeing and
provide support, education and training related to mental health to
carers and across the local community.

FDAMH’s Scottish charity number is SC011889

[email protected]

THE NEXT GENERATION AND THEIR FINANCIAL

QUESTIONS

Susan Ralston, Paraplanner & Mum

My middle child has recently been offered her first job and with the offer came a mountain of
paperwork for her to complete and that’s where mother generally comes in.

“What’s Death in Service” she asked, “do I want to join the pension scheme” (she’s only 18)
“and if I do what should I contribute?”

Things are so much more complicated now, when I joined the bank after leaving school, I was
automatically enrolled in the Defined Benefit Pension Scheme which had the Death in
Service element within it. To be honest I had no idea what a pension even was, but it was all
taken care of for me.

Private sector Defined Benefit Pension Schemes are now a thing of the past and the age at
which our children will be eligible for State Pension is being pushed up. Realistically they will
probably be over 70 before they qualify, if it even still exists then.

Making sure our children save for their retirement and understand why they need to is
paramount if we want them to be able to retire when the time comes.

How do they prioritise their money however, they have maybe passed their driving test and
would like a car? As much as we love them, we need them to have an eye on their future and
start saving up for a deposit for a house. They’re young though and want to enjoy their free
time (can we blame them?) They want to go to festivals and concerts, and if your “young
person” is anything like mine buy trainers!

I’m fortunate in as much as my child has opened a “Help to Buy” ISA and makes monthly
contributions into it. Her plan being that by the time she’s 23 she should have saved enough
(along with the 25% bonus from the government) to look to purchase her first home.

We freely speak about money and my idea is to encourage all of my children to start saving
right from the off, that way they don’t need to think about it, it just makes sense to them.

There is a lot of information on the Money Advice Service website – Beginners Guide to
managing your money and Managing your money using the jam-jar approach are just a few of
the many articles available to view.

Your children may be considering university, speaking to parents in that situation, it can be an
expensive business, have you thought about how you can either fund or help your child in
that situation?

CONTACTING VIRTUE MONEY

Virtue Money is a family run Independent Financial Adviser firm based in Linlithgow. We help
you to manage your financial goals, and really specialise in helping you with pensions or
investments.
There is no crystal ball to tell you what your financial future will look like however with a
bit of a plan there is a way to give you a clearer picture of what retirement can look like
for you.
If you would like to find out more about Virtue Money, please contact us on 0345 034
3424 or email [email protected] to arrange a free appointment with one of our
advisers who will talk you through the process and the costs involved. Our website also
provides you with more information at https://virtuemoney.com/contact-us/

Follow us on social media also

“Virtue Money have been our financial advisors for about three years. Right from the start
we have enjoyed their professional, friendly and ‘whole person’ approach as epitomised by
the pre-retirement workshop we were invited to shortly after our engagement with them.
That workshop focused as much on issues of health and well-being for those approaching
retirement as it did on financial matters and, thus, offered a good indication of the values
which underpin the company.

They have been very attentive to us as customers, communicating with us regularly and
providing what is often quite complex information in ways that are easy to understand.
They are thorough, quick to respond to any queries and we consider the service provided
to be excellent. We really appreciate the relationship we have. Always taking an interest in
us as people and our family as well as being very prepared for our meetings with relevant
paperwork provided to us beforehand. The service has given us financial peace of mind.” –
A testimonial from a client

The guidance and/or advice contained within this blog is subject to the UK regulatory regime, and is therefore
targeted at consumers based in the UK.
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