Money Management articles from January 2006

Money Management archives from January 2006

Better to give than receive?
January 1, 2006... Zopa, a new online borrowing/lending exchange, is in talks with an IFA network about a potential tie-up and is actively seeking further links with other networks and national IFAs. The talks centre on offering IFAs an initial commission for...

ARROW visits miss the target.
January 1, 2006... More than two thirds of IFA firms are frustrated by the lack of guidance provided by the FSA's advanced risk responsive operating framework (ARROW) visits, according to a survey of 136 firms. The FSA established ARROW visits in March 2002...

Closed but not forgotten.
January 1, 2006... Recently released figures from the FSA on closed with profits funds confirm concerns that closed funds do not perform as well as open funds. While 34% of open funds were top quartile, just 15% of funds that have been closed for one to five...

Time called for carry back.
January 1, 2006... Time is running out for personal and stakeholder pension policyholders to use the carry back facility to maximise contributions and tax relief. The end of January marks the final deadline for post-1988 individual pension policyholders to...

Online, on message.
January 1, 2006... Health insurer BUPA has finally taken steps to rectify its lack of presence in the protection e-business market. The insurer has developed an extranet to allow online applications for critical illness and life products, admitting that it has...

Tax relief.
January 1, 2006... Small family IFA firms will be breathing a sigh of relief after an appeal court ruling overturned a High Court decision that could have seen husband and wife companies landed with potentially huge tax bills. The decision allowed Geoff Jones of...

In search of the pensions ombudsman.
January 1, 2006... With a backlog of 1,700 complaints, the pensions ombudsman (PO) is one of the financial industry's most overstretched bodies. In response it has published a guide that it hopes will stem the flow of cases that it receives by...

Blast from the past.
January 1, 2006... Back in January 1981, Money Management looked at the issue of mortgage repayments and whether or not an unexpected windfall should be used to pay off a mortgage early or be invested in a savings account. Many advisers at the time argued...

Correction.(Correction Notice)
January 1, 2006... We regret that the cash in and current values for Standard Life for years 2-5 in the Table of results in the with profits bonds supplement included with the December 2005 issue were the wrong way around. Also, the 3 year cash in value for...

New York competition results.
January 1, 2006... THE DRAW FOR THE NEW York prize draw competition took place on 1 December and the lucky winner was Richard Shanks of Flint, Bishop & Barnett, of Derby. The competition, featured in the November issue of Money Management was sponsored by...

20 January, 2048.
January 1, 2006... Without a doubt, the biggest challenge facing the pensions industry today, both private and State funded, is the issue of greatly increased longevity. The average life expectancy age is far less important than the actual life expectancy past...

Spoilt for choice.
January 1, 2006... The SIPP offers access to more than 1,000 funds from 53 providers, plus direct equity and securities portfolios, hedge funds, investment trusts, warrants, deposit accounts, trustee investment plans, discretionary managed services and commercial...

Betting on the rising sun.
January 1, 2006... Close Fund Management has launched the Japanese Accelerated Return Fund II, which aims to return five times the growth of the Nikkei 225 during its six-year life. If the index rises by less than 16% over the six years, the investor...

Global bricks and mortar.
January 1, 2006... Schroder and US based- global property securities manager, European Investors Incorporated, have launched a fund that invests in listed property companies and real estate investment trusts (REITs). Run as an unconstrained total return fund,...

Titan or Titanic.
January 1, 2006... Nvesta's new structured product dangles a juicy carrot in front of investors, offering 7.5% gross annual income and the potential for capital growth of up to 5% per quarter. The Global Titans Income Enhancer gives investors a portfolio of...

Equity release me.
January 1, 2006... Homeowners aged 60 and over are being offered a home reversion plan that pays 6% interest for up to 12 years on cash released but not drawn down. The Cash Release Plan, launched by Economic Lifestyle, is portable and can be transferred to...

Multiply your pension.
January 1, 2006... The new pensions tax regime promises us simplicity. In the new world it will be much easier to pay in contributions to a pension to build a fund for retirement. Limits will be abolished, the potential of tax relief increased, and people will be...

Spread thinly.
January 1, 2006... Corporate bonds have been selling like hot cakes since mid-2005. In four out of the five months to October, the UK corporate bond sector has been the best seller in terms of net retail sales, knocking the equity income sector off the top spot...

Putting out philas.
January 1, 2006... The loss of tax relief on esoteric SIPPs investments has not deterred Stanley Gibbons from promoting its Rare Stamp Investment fund. The fund, which aims to produce an average annual return of 10% net (not guaranteed), invests and trades in...

Who'd want to be a trustee?
January 1, 2006... The relationship between the trustees of final salary pension schemes and the sponsoring employers of these schemes is about to come under new pressures. Until now, this relationship has in general been positive and constructive, but all...

Baby bonds.
January 1, 2006... More than 100,000 children born to Muslim families in the UK are currently eligible for the child trust fund (CTF) voucher. Children's Mutual has been swift to take note of this and has launched the UK's only Sharia-compliant CTF. The...

Turner round II.
January 1, 2006... Three years ago, in December 2002, the Government set up the independent Pensions Commission, chaired by Adair Turner, to look at long term trends in pensions savings, and to assess whether there was any need to move beyond the current...

Flouting the rules.
January 1, 2006... The head of regulatory services at the FSA has said that the Financial Ombudsman Service (FOS) has over-stepped its jurisdiction, hearing cases outside of the three-year notice period for endowment mortgage misselling. Money Management can...

Should I stay or should I go?
January 1, 2006... In the rush to protect pension- holders' tax-free cash allowances, many advisers had put the wheels in motion to transfer their clients' pensions through Section 32 buyout bonds. Likewise, trustees of occupational pension schemes were looking...

Is a national scheme credible?
January 1, 2006... The Pension Commission's proposal for a state run pension saving scheme would displace personal and stakeholder pension plans, with providers, consultants and advisers effectively excluded. Even if the pensions industry were to play a part...

Market gets HIP.
January 1, 2006... Home information packs (HIPs) are set to transform the business of buying and selling a house in England and Wales, according to the Office of the Deputy Prime Minister (ODPM). But not everyone is convinced that they will make a great deal...

Income all ye faithful.
January 1, 2006... If most IFAs were asked to name their favourite unit trust sector, UK Equity Income would probably be the instinctive answer. Over the past five years it has taken the centre ground in the IFA market, becoming the core asset class of choice...

Tried, tested and rediscovered.
January 1, 2006... The performance of UK Equity Income funds over the last five years has prompted a rash of new funds and earned the support of investors. Cynical observers might suggest that this, coupled with significant rises in the valuations of many...

Income confidential.
January 1, 2006... If IFAs were asked to design a fund that met the requirements of a typical client, the outcome would probably resemble a UK Equity Income fund. Over the past five years in particular, the sector and its fund managers have been hugely popular...

Charges compensation.
January 1, 2006... Legal & General is facing a AGBP1.3m bill after understating charges on thousands of policies over a 10-year period. L&G has written to 7,500 pension, investment bond and unit-linked endowment policyholders admitting that some fund charges were...

The battle for wrap business.
January 1, 2006... While promoting benefits for advisers and clients, the aim of wraps is to create new links between advisers and fund managers, with supermarket-based wraps, personalised investment management based wraps on the US model, or 'full wraps' on the...

Goodbye vanilla.
January 1, 2006... When investing for income, it would seem like common sense to look for companies offering high dividends. But simply selecting a group of stocks that are currently on high yields is likely to end in grief. Many high yield names have high yields...

Pre Budget report.
January 1, 2006... The Chancellor Gordon Brown shocked everyone with his surprise U-turn on residential property and other exotic investments into SIPPs post A-Day. This grabbed most of the national press headlines in the few days after the pre Budget statement,...

Portal power.
January 1, 2006... The biggest challenge facing portals and providers in 2006 will be keeping pace with industry change and turning it to their advantage. Various innovations and service developments have propelled the software beyond that of a quotation engine,...

Adding the human touch.
January 1, 2006... The pace of industry change showed no sign of slacking in 2005, a year of massive regulatory change bought about by the FSA. From the implementation of the ICOB rules for general insurance and the depolarisation of the financial advice market...

Taking stock.
January 1, 2006... There seems to be a human tendency to equate more expensive with better. No one has benefited more from this than fund managers, which probably explains why investors have generally made more money buying the fund managers than their products....

The case for technology.
January 1, 2006... Even the most stalwart technophobe financial adviser now recognises that the 'paperless' IFA business is on the way to becoming the norm. More product providers are improving their extranet services, portals are expanding links with providers...

Stepping it up.
January 1, 2006... In the year since general insurance regulation was ushered in, the advantage to the protection market of effective e-commerce has become increasingly clear. In effect, the industry has gone from a situation where just one or two insurers were...

Turner proposes Government issued longevity bonds.
January 1, 2006... Pensions commission chairman Adair Turner believes that the UK Government could play a role as an issuer of long end longevity bonds in order to support the annuity industry that is facing a shortage. Longevity bonds are considered the...

A-Day already.
January 1, 2006... Standard Life is already applying the post A-Day borrowing limits for commercial property purchases in SIPP applications, months ahead of schedule. As of A-Day, the borrowing limit for commercial property purchases in new SIPP applications will...

Freedom of speech.
January 1, 2006... Employers are effectively being given a carte blanche by the Government to promote their group personal and stakeholder pensions to staff without requiring FSA authorisation. A series of recent low-key Government rulings have been brought...

Pension mishandling report delayed.
January 1, 2006... A report by the Parliamentary Ombudsman into Government mishandling of the collapse of occupational pension schemes has been delayed for a second time. The report, which will decide whether the Government's actions caused 85,000 people to lose...

Residential property U-turn.
January 1, 2006... Chancellor Gordon Brown stunned pension providers and holders with his pre Budget report, effectively reversing his earlier decision to allow SIPPs to hold residential property and exotic investments such as wine and art after A-Day. The...

Extra heavy levy.
January 1, 2006... News that IFA firms face a steep rise in the contributions that they pay to the Financial Services Compensation Scheme came as a nasty shock. The reason for the increase is that there has been a substantial increase in the number of...