FAQs

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Here we provide answers to some of the questions our advisers get asked most frequently...

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General

How much does financial advice cost?

Our initial consultation is usually free of charge and without obligation. We will discuss your financial goals and compare these to where you are now. We will then make a plan to bridge the gap between where you are now and where you want to be.

 

For the majority of cases, our initial charge is between 1% and 3% of the assets we look after for you, depending on how much work we need to do. This will always be agreed with you from the outset. You have the choice of whether you pay any fees directly to us, or by deduction from the investments we recommend.

 

Ongoing charges again will depend on how much is in your portfolios and the amount of ongoing work we agree to do to maintain and review them. Typically, this charge is between 0.5% and 1% per annum. Again, this will always be agreed with you at outset. As with our initial fees, you have the choice on whether you pay us directly or by deduction from your portfolios.

Are financial advice fees tax deductible?

Under normal circumstances they are not. However in certain situations, and if paid by a business rather than an individual, some fees may be classed as a business expense. 

How will I know how much risk to take with my money?

Risk and reward are directly linked. Generally speaking, over time, the more risk you are prepared to take the more reward you will get. However, more risky investments tend to be more volatile. As such, they can go down more than cautious investments in bear markets. 

 

Our process involves a series of questions to determine your attitude to risk and capacity for loss. Once completed, we will recommend investments suitable for your risk profile. 

You may not want to take the same amount of risk with every tranche of money and this is something we factor into your overall portfolio construction and maintenance. Our review process ensures that your portfolio remains in line with your risk profile as your circumstances change with time.

Investments

When is the best time to invest?

Logically, it is best to buy at the bottom of the market and sell at the top, however it is impossible to second guess how markets will behave, particularly when they are volatile. Our advisers will discuss and agree an investment strategy with you to decide whether you would like to invest your money all at once, phase some or all of it into the markets to benefit from pound cost averaging, or combine the two approaches.

How much can I invest into an Individual Savings Account (ISA)?

ISAs are tax free and, as such, contribution limits apply. Our advisers will provide you with details of the different maximum contribution levels and discuss a strategy to ensure you maximise the tax efficiency of your plans. 

 

There are a number of other investment vehicles available, such as Investment Bonds and General Investment Accounts, which can be used in conjunction with ISAs to invest amounts over the ISA allowances. We will discuss how best to blend these plans together to suit your circumstances.

Pensions

Are pension contributions tax deductible?

Generally speaking yes, which makes pension planning an attractive proposition for many people. Rates of tax relief do vary though and maximums exist. Our expert advisers will provide you with full details.

How do pension plans work?

Contributions are made as single premiums, regular premiums, transfers in or a combination of the three. Contributions can be personal, from an employer, or third parties. Most people will accumulate a number of pension plans throughout their working lives and very often benefit from an exercise to consolidate all of these into one place. Find out more about the advantages of pension consolidation here.

 

Typically, 25% of your pension pot is yours tax free with the rest taxed as earned income. It is important to take advice though as this can vary depending on the kind of plan(s) held.

Where should I put my pension?

There are several different kinds of pension. Our advisers will advise you on the most suitable plan to suit your needs.

How do I find out where my pensions are held?

We can help you to track down historic pension plans. Many people are pleasantly surprised of the value of pension plans from the past – particularly those held with previous employers. Read more about tracing lost pensions here.

At what age can I draw my pension?

Generally, personal and company pension benefits can be drawn from age 55. State pensions currently start from age 66 however this will increase from 2026 onwards.

Do you offer Environmental, Social and Governance (ESG) investing?

Our investment process involves discussion around your attitude towards ESG investing. Many investment fund providers now have specific ESG funds with investment philosophies that vary from mainstream funds. It is important that your investment portfolio accurately reflects your ESG views, and our advisers will make appropriate recommendations in this area once your views are known.

Later life planning

How does Inheritance Tax (IHT) work?

IHT is a tax on the estate (the property, money and possessions) of someone who’s died. There is normally no IHT to pay if the value of your estate is below the IHT threshold (currently £325,000), or if you leave everything above the threshold to a spouse, civil partner, charity or certain other approved bodies. Additional allowances may be available on residential property passed on to certain approved parties.

 

Currently, IHT is paid at 40% on any assets over the threshold and has to be paid by the beneficiaries of the estate before excess funds are released.

 

With careful IHT planning, the use of trusts, gifting allowances and certain specialised investments can be used to mitigate the effects of IHT. Our advisers will help you design tax efficient solutions in line with you needs. 

Can you help with later life planning and care home fees?

Individuals will have to pay for their own care if they have income and capital above certain limits. 

 

Income is subject to individual means testing and broadly speaking, anyone with capital currently over £14, 250 will need to contribute to, or pay for all their care. Property may or may not be included depending on who lives in the home.

 

Some types of investments such as pensions and investment bonds may be disregarded, and our advisers will be able to advise you on your options.

Mortgages

How much can I borrow?

Lenders will lend up to five times your gross income, or if there are two of you, four times your combined incomes. The mortgage market is increasingly complex though and our experienced advisers will help you fund the most suitable deal after searching the market.

 

Ideally, to benefit from the keenest rates, you will need at least a 10% deposit. However it may be possible to put down less than this.

There are a number of different types of mortgage available – variable, discounted and fixed. Our mortgage department will be able to advise you on the most suitable option for your circumstances.

 

Mortgage advice fees typically start at around £500, but can vary depending on the complexity of the case.

What are specialist mortgages?

Should you have specialist borrowing requirements, such as purchasing commercial premises, rental or overseas properties, or indeed have adverse credit, we are likely to be able to help you secure the finance you need from our panel of specialist lenders. Find out more about our specialist lending services here.

How long does the mortgage process take?

There is often a chain involved when purchasing a propery, so you are likely to be dependant on others. However, allowing three months from start to finish is not unreasonable. Remortgages may take more or less time than this depending on the complexity of the case.

What if I die, get diagnosed with a critical illness or I am sick for a long time? How will we pay the bills?

There are many different ways to protect your family and business in case anything untoward happens to you. These solutions range from simple life insurance plans, which pay out a lump sum on death, to menu-based cover against death, critical illness and the inability to work. 

 

The use of various options and trusts can also help provide tax efficiency of benefits, with some corporate solutions even benefiting from tax relief. Our advisers are experienced in putting these packages together to suit individual needs.

Do you have unanswered questions?

Book a FREE initial consultation with one of our experienced advisers. Call 0115 947 5545 to arrange your appointment.

Get in touch

For further information on how George Square Financial Management can help you protect and build on your finances, please complete the enquiry form below.

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