“Seek not proud riches, but such as you may acquire justly, use soberly, distribute cheerfully, and leave contentedly”
Francis Bacon - philosopher and statesman 1561-1626
So how does it work?
Family Income Protection
To safeguard a family’s financial ease, in the event it suffers the death of either parent. For example, a couple aged 30 could secure a tax-free £2,000/m income for the surviving spouse, and children to adulthood, for a premium of about £30.
For retail investors willing to run their own ISA or pension portfolio, online brokers provide a convenient execution-only transaction service. All brokers are not the same though, so some guidance may help.
Exchange Traded Funds
An ETF tracks an index; accurately, explicitly, inexpensively. For instance, the FTSE Equal-Weight 100, comprising 1% of each stock, and costing only 0.25% per year.
The focus of some IT means they invest in assets beyond the reach of ETF. Among my favourite IT are those in which the owners have already staked a large part of their own prosperity.
Critical Illness Protection
80% of all claims arise from three kinds of illness: heart disease, stroke and cancer. People like me, who are happy to work well beyond 65, might be wise to focus more on life insurance and less on pension.
Small self-administered pension schemes
Thanks to liberal death-benefit rules, and exemption from annuity-purchase; to the owners of family companies, SSAS offer new relevance.
Power of Attorney
One of the most cost-effective financial planning actions anyone can ever take. A PoA supports a person’s freedom to control his own affairs for as long as he continues competent.
Whole-of-life assurance for mitigating inheritance tax
Designed to put a predictable sum of tax-free capital where it’ll be most valuable to a family, on an unpredictable day: whole-of-life assurance in trust is a method I have seen many times work perfectly.
Funds either to smooth investment performance, or to lock-in upward movement
For investors whose highest priority is predictable income, or secure capital; or for investors who’d appreciate resilience to market-shock, and insulation from economic jeopardy.