"I never have the faintest idea what the stock market is going to do in the next six months, or the next year, or the next two. But I think it is very easy to see what is likely to happen over the long term"

- Warren Buffet


Wealth Management

In our view, anyone that says they can predict the future should be carefully avoided. That goes for inflation, interest rates, individual shares, asset classes and the economy. However, we do believe that markets work and that we can harness the positive effects of markets for our clients.

Costs, Taxes, Risk and Asset Allocation:
(The parts of wealth management that you can control!)

Costs

With recent market developments Financial Planners are well positioned to provide clients with low-cost access to the markets and the benefits of investment growth.

Taxes

Pay the tax man no more than he is due! Pensions, ISAs, Venture Capital Trusts* and Capital Gains Tax allowances are just a few of the main tools available to protect your wealth from Her Majesty’s Revenue and Customs.

Investment Risk

Very few investors spend enough time considering their attitude to investment risk. We will go through a tried and tested approach to establish your attitude to investment risk before designing an investment portfolio that is in line with your attitude to investment risk.

*Venture Capital Trusts are very high risk investments and are therefore not suitable for everyone and advice should be sought before investing in them.

Asset Allocation

Roger Ibbotson and Paul Kaplan published a landmark study in 2001 titled "Does Asset Allocation Policy Explain 40%, 90%, or 100% of Performance?”. The report confirmed that more than 90% of the variation in portfolio return is explained by asset allocation decisions. It is not the selection of individual stocks or bonds driving performance. It is the asset allocation that makes the difference in the long-term.

In short, successful wealth management begins with a properly diversified investment portfolio. Constructing such a portfolio with income tax, capital gains tax or inheritance tax issues in mind is a complicated process that benefits from the guidance of a qualified, professional adviser.



To discuss matters further please call Michael Fairweather on 0131 556 0739 or email michael@reallifefinancialplanning.com

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