Whether it’s around the corner, several years or decades away, financially secured retirement requires planning. In order to plan retirement a person should be able to generate an income for life. It is very important to make sure this income never runs out no matter how long an individual lives. It is also vital to ensure that the income is inflation proofed.

Impact of Inflation

Inflation is a trend of increasing prices from one year to the next, consequently, the purchasing power of currency is falling. The rate of inflation represents the real value of your pension and therefore it is necessary to know this in order to have a guide as to the investment return rate to maintain your standard of living expected in retirement.  Inflation can impact a person’s retirement income more than anything else.

A British National retiring at 60 today will be expected to live for 18 years on average after retirement. It is entirely possible for a person retiring at 60 today to live for 40 or even 50 years after retirement. If an individual had set aside a sufficient pension to pay them $5,000 per month at retirement we might feel they have a well-financed retirement. However, without an increase for inflation and an average inflation rate of just 3%, this $5,000 will be worth $3,800 in 10 years, $2800 in 20 years and just $2,067 in 30 years. Considering this, the return from investment should be at least equal to or greater than inflation rate.

Annuity

An annuity is a regular income guaranteed for life. You “buy” an annuity with your pension fund after retirement. Basically you exchange the sum you’ve saved for an annual income.

If you have an occupational pension your employers will normally arrange your annuity when you come to retire. You don’t have any choice in the matter.

If you have a personal pension, as retirement approaches, your pension provider will contact you with an offer of an annuity

When you buy an annuity you lose your pension fund forever by swapping it for the agreed regular income.  There’s no going back and your loved ones do not get whatever’s left over when you die. The pension you saved for years is not yours anymore.

Annuities also have very poor rates. As the insurance company must insure your income for life they generally aim at very low risk investments. A typical annuity rate for a 60 year old is 4%. For example, £100,000 into an annuity will pay an income of £4000 per year with loss of the entire fund on death.

Frozen Pension

In the modern work environment people will tend to move across many different employers. As a result most people will tend to have more than one pension. These pensions that are not being contributed to are referred to as ‘frozen pensions’. These are pensions which are no longer receiving funds from either the member or the employer.

Farringdon Group’s retirement financial planning specialists can help you choose from the full spectrum of both offshore and onshore private pension plans to help you find the best of for you and we can assist to unlock these frozen pension to get this investment working for you and the future.

I hope that you have enjoyed reading this post.

Stuart Yeomans 

CEO

Farringdon Group

Kuala Lumpur : Malaysia

Many expatriate parents feel comfortable placing their children at international schools rather than at local schools. The benefits of a private international school is the peace of mind that their children are being educated to an international standard that applies back home too. Some expatriates are fortunate enough to be offered contracts with school fees contributed by their employer, but for the many who don’t it is a case of having to put money aside to give their children the best possible future.

Next to buying a home, a college education might be the biggest purchase a person makes after buying a home. For example, average tuition costs in the UK is around GBP 3.500-20.000, in Canada prices vary between CAD 15.000-CAD40.000, while in the US it is between USD 20.000-USD 50.000.  As it can be observed, where parents wish to educate their children will dictate the cost. The cost of educating a child in the US is far greater than Canada or United Kingdom.

Education costs have significantly increased over the last decade and according to the College Board these costs will keep climbing.

Of course, no one can predict the cost of education at colleges in 5, 10 or more years. However, following historical trends annual price growth in the range of 4-7% will most certainly continue.

Therefore, in order to ensure that children get the best education that they deserve, early financial planning is important.

Setting up an Educational Plan early gives your money more time to grow and help you benefit from the power of compounding.

Below is a hypothetical example of a Standard Education Fee Planning if you save GBP 1000 over a period of time:

As we can see, even a modest monthly investment can grow to significant university fund, by the time your child needs it.

Our experienced consultants offer expert advice on how to plan for education costs and also how to prioritize your investment money if time and/or funds are limited.

I hope that you have enjoyed reading this post.

Stuart Yeomans 

CEO

Farringdon Group

Kuala Lumpur : Malaysia

We make lifestyle choices to reap the true rewards life has to offer us. Have you made your personal choices? Are you the type who enjoys an active social life, being pro-active within your own community? Do you and your family members routinely take part in sporting events, outdoor adventures and family-related activities?

All of us dream of having the perfect life – being able to travel the world, being able to have enough money to do whatever we want, to enjoy sports and other outdoor activities we and our families like, and enjoying doing all of that while at the same time being ensured we are protected too.

Accidents can happen anytime, anywhere and making sure you and your family are being adequately protected has become a necessity in this world. Being smart and planning ahead helps protect you and your family members. It will ensure you have complete peace of mind as you go about your daily lives doing all the things that you love in your leisure time, be it travel, sport, or adventure, knowing you have all the protection you need via our extensive leisure protection plans.

More often than not, travel insurance isn’t included in your holiday travel plans, and if it is it requires some serious concentration time to find out what is and isn’t covered and to understand the fine print. Holiday plans should be about the destination and finding the best accommodation for your special holiday, which takes a fair amount of time, anyway.

Many travel and healthcare policies operate limitations or exclusions for ‘Adventure’ activities. At Farringdon Group, we have made the effort to design a simple, wide-ranging, and cost-effective Adventure Insurance policy with one of our insurance partners.

No matter the type of sport you play, there is always the risk of injury. Farringdon Group invested a great deal of effort and time in building our Sports Insurance as a stand-alone or Supplemental provision to meet our clients’ needs when they participate in sports or higher-risk recreational activities outside their country of residence.

At Farringdon Group, our leisure protection covers travel, adventure and sports for both business and personal. Contact us for more details on advising the most suitable coverage for you.

I hope you have enjoyed reading this post.

Stuart Yeomans

CEO

Farringdon Group

Kuala Lumpur : Malaysia

Financial advice and financial planning covers broader areas than just guidance for investing.  Nowadays, planning professionals are an essential resource.

Financial advisor’s manage and combine all aspects of individual’s financial life from saving to planning for retirement, to educational funding, managing tax exposure and satisfying insurance needs.

A prepared financial plan can help an individual to take decisions that optimise their financial situation to make the most of their wealth – now and in the future.

Nowadays with the financial industry having a negative reputation, individuals easily assume that given advices just help advisor’s to lure money into their own pockets. And while there are many cases of screwed up portfolios by untrustworthy investment advisers, many individuals should take advantage from having the aid of a financial expert.

A professional planner understands the complexity of the financial environment and is equipped with knowledge to make decisions that help to achieve financial confidence and security.

Following are some of the advantages of using a financial adviser:

1. Identify and Set Realistic Goals. Setting financial goals will help individuals to achieve their needs and will suggest right list outlining what they want or need to accomplish.
2. Secondary Opinion. One of the reason investing is not successful, majority of individual investors take decisions on their own with no training or education. The financial adviser will give you an unemotional, honest and non-obligatory assessment of what needs to be done.
3. Asset Allocation. Individuals may not always allocate their investment strategically, which can lead to under-allocation or over-allocations. Financial advisers will identify risk appetite and tolerance of individuals and set a strategy to achieve widely-diversified portfolio of assets with a suitable risk.
4. Tax Minimization. The tax regimes of countries are constantly changing and becoming more widespread in terms of offshore investments.  Financial advisor’s can help by looking at individual’s investments and how they are structured. Recommendations are done after assessing specific country’s tax regulations in terms of investment and tax liabilities. This may involve the use of trusts to protect assets and even to take them out of estate altogether.
5. Security and Comfort.The right financial advice can also help in planning retirement in terms of how much individuals will need and also provide the guideline to get there. Often pensions suffer from poor returns and a lack of transparency. Financial planning specialists can help you simplify pensions and maximise returns to give the best possible income in retirement.

In a world where personal financial issues have become increasingly and often unnecessarily complex, professional advisor’s help plot a financial course with the confidence that individuals are using their resources wisely while avoiding the common pitfalls that so many fall prey to.

If you have any queries on the above, please do not hesitate to get in touch,

I hope that you have enjoyed reading this post.

Stuart Yeomans

CEO

Farringdon Group

Kuala Lumpur : Malaysia

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