Contact

News & Insights

‘Soft’ or ‘hard’ Brexit…

I recently joined a colleague of mine and attended a talk by Lawyers of PLMJ – one of Portugal’s leading legal firms – at the invitation of the Portuguese Chamber of Commerce in the UK. The firm has clearly spent some time internally looking at some ‘key’ areas; attempting to identify what would happen in the event that Article 50 is invoked. Some great detail was provided on subjects such as visas/residency, health, and trade.

While this was all extremely useful and enlightening, I was still left with a feeling of ‘who knows?’

We don’t at this stage know whether this will be a ‘soft’ or ‘hard’ Brexit; whether the UK’s deal with the EU will look like Norway or some other ‘special’ deal. All I know is that none of this would have taken place if the EU had listened to the issues and sought some consensus on the subject of immigration. A great deal of this is evident in the sentiment of far right groups in other Europeans countries – who seem to be gaining ground. Even Merkel herself seemed to finally realise her stance on immigration could impact her remaining in power at the next German general election.

The fact we do know is that a referendum is not a legally binding vote. It would seem that the Prime Minister will invoke article 50 without going to parliament; hence numerous legal cases being raised to ensure that she does. Surely this is a decision that cannot be made without discussion in parliament.

At the morning of writing this piece, I read an interview from the ex-prime minister, Mr Tony Blair, seeking a second referendum and suggesting that the ‘Remainers’ should take to the street and be heard; he also felt that the general opinion of the British public had changed and that leaving the EU was no longer what was wanted.

In the event of a Brexit it may well be the case that we need to seek a Visa or jump through a few more hoops to get residency – but do we really think that Portugal will make it difficult for the British expat to remain and/or move here? Personally – I don’t think so.

The one area of concern I do have is on the subject of pension transfers. If the UK were to leave the EU and move away from EU legislation – what will they do with pension legislation? could they remove the ability for those with UK based pensions to transfer them into the EU through Recognised Overseas Pension Schemes? I think this is a possibility – especially taking into consideration the poor position most defined benefit pension schemes find themselves in.

Pension transfer calculations at this moment seem high versus the guaranteed pension benefits on offer; this coupled with low interest rates and a falling lifetime allowance add up to a perfect time to review any UK-based pensions – a mere 2% increase in interest rates could have an alarming impact on a Transfer Value. Advice in this area, however, is essential.

So whatever the politicians decide to do, I think the feeling of uncertainty will remain with me for the foreseeable future.

 

This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.

Other News

Saving & Investing in Volatile Markets

Luke HuntGenerally speaking, saving money and planning for your future are two key aspects of financial planning. So, getting this right as early as possible should be one of your main priorities, to ensure that there are no nasty surprises down the line. There are a multitude of reasons that you might choose to put money aside, such as for a “rainy day fund”, a house purchase, your children’s education or making sure that you can retire comfortably.

Whatever your objective is, you can save by either putting money aside each month, or, if you have already managed to save money in the bank, look to gain a better rate of interest for a greater return. This could be a particularly advantageous avenue when you consider that in fact, once you take inflation into account, most money on a bank deposit will effectively be losing its value each month.

Read More

Auto-Enrolment increases number of savers, but are they saving enough?

Piggy bankStatistics from the Office for National Statistics (ONS) have shown that a record number of savers are now members of workplace pension schemes.

The figures show that the proportion of employees who are contributing to a company pension has risen significantly in the five years since Auto-Enrolment (AE) began.

AE was introduced in 2012 and makes it compulsory for employers to automatically enrol all eligible employees into a pension scheme unless the employee actively opts out. An employee is eligible for AE if they are aged between 22 and the state pension age and have a salary of more than £10,000.

In 2012, prior to AE, 47 per cent of UK employees were enrolled on a company pension scheme. This figure has now risen to 73 per cent in 2017. In other words, there are over 9.5 million more people saving for their retirement than there were five years ago, and it’s mainly thanks to AE.

Read More

Select your country

Please select your country of residence so we can provide you with the most relevant information:

You are currently viewing the Blacktower Financial Management EU website.

You may be looking for the Blacktower United States website.

Blacktower United States > X Stay on this site

Or choose your country.