Financial planning, inheritance and wealth management in the UK during the coronavirus pandemic

Unless you’ve been living under a rock for the past four or five months, you will have heard about the current global pandemic, COVID-19, a new strain of coronavirus (named as such because under the microscope the viruses are covered in pointed structures that surround them like a corona, or crown).

In fact, if you have been living under a rock, it’s probably best you stay there! Self-isolation and social distancing are two ways we can flatten the curve in the number of cases, reduce the virus’s impact on the most vulnerable in society.

In this blog, we’ll discuss the current COVID-19 outbreak, the effect it has had on the UK economy and offer some much-needed advice on how to limit potential impacts on your financial planning, tax planning and pension pot.

How has coronavirus affected the UK economy?

COVID-19 has caused ripples of damage to the UK and the wider global economy in recent months. The airline, leisure and hospitality industries are three of the main sectors to be affected which has led to convulsing markets after investors panicked.

In terms of figures, the FTSE had a sharp fall and reached an eight-year low on Monday 23 March as fears of a great recession worsened.

The main symptom is uncertainty as this rapidly changing situation appears to be altering on a daily, almost hourly basis.

What we can diagnose is that ultimately COVID-19 will have a ‘significant impact’ according to Chancellor Rishi Sunak.

How to help keep your investments safe and your financial plan secure

Since 1995, Equilibrium Financial Planning has built up a wealth of expertise, helping clients action effective, fruitful financial plans in both rain and shine.

So, we thought we’d outline a few ways you can keep your financial future on track during these uncertain times.

If you have a financial plan, you don’t need to panic

We talk about the importance of financial planning all the time here at Equilibrium, because when things like pandemics, global crises and other such things arise, it’s vital you have a plan in place.

Markets and economies have dealt with huge blows in the past (see the 2008 great recession, 9/11, World War 2, Cuban Missile Crisis) and have gone on to recover. Though understandably stressful at the time, life went on and the stock market continued its historical upward trend.

The best thing to do in these times is to trust your long term financial plan and, if you don’t have one, now is the time to put one in place. The more you look at and obsess over your financial plan, the more likely you are to consider making irrational decisions based on inflammatory news that changes on a daily basis. Adopting a long-term strategy is the best way to manage your money in this crisis.

Other benefits of financial planning…

• Improved income management: Effective tax planning helps you manage your income and gives you a clearer idea of fees you’ll need for specific financial activities.
• Improved family security: A big reason people choose to build a financial plan. Having one ensures you have all the right policies in place.
• Increased cash flow:A greater understanding of your incomings and outgoings, as well as your spending and tax, can make a real difference when it comes to improving your cash flow.

Stay calm about investments

Again, with your investment portfolio, it’s vital that you do not panic and instead adopt a long-term approach.

Our investment planning services help to ensure that you choose a strategy that will shield against short-to-medium term effects of market volatility and other exogenous shocks such as, say, a global pandemic… not sure how we came up with that suggestion!

Click here to discover more about investment planning.

Don’t ignore your retirement plans

Despite these testing times, it’s still important to remember your future.

Because a pension plan is open to risk, much like any other investment, it’s important to plan early and be prepared for ups and downs along the way. Planning early gives you a long time to accumulate a ‘pot’ whilst investment will mitigate the risk.

It can be hard to know how much you should set aside for future retirement plans but thankfully we have a wealth of expertise that you can lean on.

We really want to stress how important it is to think long-term about your retirement plans. Things will recover despite the ongoing news about COVID-19, the fear it is instilling and the effects it’s having on the economy. Making irrational decisions now based on a global pandemic that may only be around for a year or so is only going to cause your investment and pension pot to decrease in value.

Warren Buffet, arguably one of the world’s greatest investors, said: “Buy or sell your business based on today’s headlines…you can’t predict the market by reading the daily newspaper.”

In summary, whilst COVID-19 will be in our lives for the short and medium-term, your financial planning, investments and retirement plans will be with you and your family for life.

Hear from our clients

We pride ourselves on giving clients the best experience at Equilibrium Financial Planning and we have a series of client testimonials that advocate our services.

If you’re unsure about where to start your investment portfolio, retirement plans or financial planning, feel free to give us a call and our friendly experts would be happy to answer any questions you may have.

And, finally, please make sure to keep you and your family safe during this pandemic.

This isn’t related at all to investment funds, money management or pension plans but it’s the most  important thing to do at the minute.

We care about your financial plan but we also care about your health and wellbeing, so be sure to look after yourself!

Risk warning: the content contained in this blog is solely intended for the entertainment of the reader and does not constitute a solicitation of advice. The value of your investments will fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.