As the Government begins to ease the Covid-19 lockdown, a small level of normality is being resumed for some. But with mistrust in the stock market and financial anxiety high, what have we learned about planning for later life and how can investors be guided through this stage of financial planning in a time of such uncertainty?
For most, 2020 will be a financial year we will rather forget. The FTSE 100 Index experienced its second largest one day fall in history, 59% have reported a loss of income1 and there is discussion that the recession could turn into an entrenched depression. Those planning for a long retirement with heavy reliance on their hard-earned capital could be forgiven for shying away from any financial plan with the word investment attached. But this anxiety can lead people to retreat to perceived safe-haven assets like cash and forgo potential investment benefits. Stockpiling (cash not pasta) to provide for basic financial needs can result in capital erosion and leave other areas of later life planning, such as inheritance tax efficiency or flexible access, neglected.
For many, the pandemic has brought about a focus on mortality. As a result, we have seen an increase in enquiries about passing wealth to loved ones efficiently, which is of course a crucial part of later life planning.
But I have written before about the importance of looking beyond legacy planning in achieving a holistic approach to later life planning. There are numerous objectives to meet simultaneously, including preserving assets, seeking a return to pay for retirement, avoiding volatility, optimising tax-efficiency, and planning for unpredictable costs such as care.
When planning in later life, most services neglect the majority of these outcomes, often focussing only on one aspect, such as income or tax efficiency rather than taking a holistic approach. In the current environment, which has created a lot of uncertainty and anxiety, re-visiting investors’ full range of objectives and focussing on the outcomes they require is key to not making uninformed, irreversible decisions.
Most investors planning for later life are in the decumulation phase, with little or no new income and a focus on paying for retirement. To limit capital erosion, especially for those in the earlier stages of later life planning, a return on capital is therefore desirable and certainly should not be considered unattainable. However, when investments are relied upon for ongoing specific needs, volatility is the ever-present enemy. The recent volatility, though extreme, has heightened awareness of how investments can be impacted by market sentiment, so investors should be made aware of how to access the return required without the need for exposure to volatile markets.
Volatility risk can be mitigated by the use of unlisted investments that are not subject to the same systemic risk as all listed investments. For instance, private trading companies carry the benefits of being valued solely on their fundamentals, rather than short-term sentiment. To deliberately target predictable returns, they can engage in secured lending, meaning investors are not exposed to equity or operational risk. Lenders who select quality counterparties and operate under robust lending criteria, can achieve targeted, stable long-term returns.
Life is unpredictable and no matter what stage of life you are at, unexpected costs continue to present themselves. Be it a family wedding, home improvements or the cost of care for example, it pays to be able to access savings. Therefore, flexibility is key to later life planning and investors should be deterred from making irreversible decisions that may only meet their tax efficiency or income objectives but neglect the potential need to access their assets.
For example, there has been an increase in demand for fixed-term annuities since the Covid-19 pandemic2, and although this solves the problem of a reliable income, with no volatility, it removes the flexibility people in later life might need if their circumstances change.
Financial planning for inter-generational wealth transfer in the UK is needed as the country is set to hand over £55tn2 between generations over the next 40 years. But as we all live longer, investment objectives are becoming more complex and varied, putting great onus on the financial adviser to deliver a flexible solution to best ensure an optimal client outcome. Ingenious Estate Planning is a family of flexible services that focus on outcomes in later life, targeting low volatility and steady return, investing in companies that should qualify the investment for inheritance tax relief after two years.
For more information on Ingenious Estate Planning Services, contact our client relationship team at investments@theingeniousgroup.com
– 1Source: ONS: Personal and economic well-being in Great Britain, May 2020
– 2 Source: The Great Wealth Transfer is Coming, Putting Advisers at Risk, July 2015
It is widely known that the UK’s population is ageing. In fact, by 2060, people will spend a third of their lives in retirement, according to AgeUK1. While the prospect of a long and healthy retirement is of course appealing, unfortunately living longer brings its own challenges and a need to plan accordingly to optimise well-being.
Ageing increases the likelihood of requiring professional care due to the increased propensity of disability or chronic and complex health conditions. One in three women and one in five men are likely to require residential care in later life2 and many more will require professional or informal care at home.
While this paints a somewhat gloomy picture, forward planning can alleviate stress and hardship at what is undeniably a difficult time for families. While some seek professional advice through care consultancies directly, financial advisers can also be a valuable resource. By considering your clients’ later life planning in a holistic way, you can advise on financial preparation as well as providing valuable planning resources. This can include involvement of your clients’ families, making the role of the financial adviser indispensable in times of need.
Through sharing some of Ingenious Care service’s insights into the complexities of the UK care system, we hope to help you build on your knowledge and emphasise the importance of planning ahead.
The UK’s care system is fragmented and relies on communication between the NHS, Social Services, families and care providers. Each has responsibility for different parts of an individual’s care across an infinite number of possible scenarios. Without experience, it can be problematic to navigate towards the best outcome.
From the individual and their family’s point of view, this is made harder as they are asked to be experts in something they have most likely never experienced before. Getting the care of a loved one right first time is crucial to their well-being and the experience of the whole family.
‘The challenges faced by those entering and receiving care should not be underestimated; there are many inherent barriers to people making well-informed choices in this sector.’ The Competitions and Markets Authority.
The UK offers many different types of care and care settings. These range extensively from day centres, visiting care and live-in care, to care homes providing residential and nursing care, with many variations and specialisms in between. Many people assume they would choose a care home based on their judgment of a noteworthy feature, a beautiful garden or period building perhaps. But when care is needed, everyone’s situation is unique. Choice is determined by a variety of factors, including the type of care required, location, affordability, quality, and other personal choices.
In 2016/17 there were 8,500 domiciliary care providers in England, with high numbers of suppliers leaving and joining the market, employing around 680,000 people. The quality of this care varied with 81% being rated ‘good’ by the Government Inspectorate CQC and 16% rated ‘requiring improvement’.
In addition, there were approximately 11,300 care homes in the UK, managed by around 5,500 providers. Again, the variation in quality is enormous. In England, 58% were rated ‘good’ by CQC, while 27% ‘required improvement’ 3.
There is also an increasing use of assistive technology for people wanting to protect their health and wellbeing and live independently. There are three types to consider.
Assistive devices include a whole range of products such as walking sticks, grab rails, stair lifts and electronic pill dispensers, all designed to help people remain safe at home.
Telecare devices range from items such as personal alarms, fall detectors and intruder alarms to in-home monitoring. For example, motion sensors and pressure mats can monitor normal behaviour patterns and send alerts to a chosen emergency contact or call centre if they detect that something may be wrong, such as a prolonged lack of movement or a fall.
Telehealth devices are used to enable health professionals to remotely monitor long-term health conditions, such as diabetes or high blood pressure.
Different approaches suit different needs and individuals. One certainty is that there are a vast range of care options available and selecting the right one can hugely enhance well-being. But the system is complicated and when people are not equipped to ask the right questions or speak to all the possible agencies, they can suffer and pay more than is required. Prices can differ greatly, but importantly, highest cost does not necessarily determine the best quality or most appropriate care.
Through forward planning and considering local care options prior to any care need, financial advisers can help clients invest towards the cost of care and ensure that funds are accessible if care should be required.
The cost of care often comes as a shock to families. In the South East of England, the cost of privately funded domiciliary care currently varies from around £17-£26 per hour on weekdays, while care home rates (covering all types of care) range from around £800-£2,000 per week. That’s £41,600-£104,000 per annum4.
There are sources of state funding, some of which are means-tested. For example, those in England with assets of over £23,250, who do not qualify on health grounds, will be required to pay for most of their own care. For residential care, the £23,250 includes the value of their house (unless the individual concerned has a partner or other dependent who will continue to live in the house). However, the rules are quite detailed, and vary across England, Scotland, Wales and Northern Ireland.
There are other types of funding available, for instance attendance allowance, and financial advisers or other independent specialists can be an invaluable resource to families making plans for care to ensure all applicable funding is received. Because ‘expensive’ does not necessarily mean ‘best’, professional advice helps ensure that clients avoid any inappropriate costs and benefit from all available allowances.
Through being aware of the vast array of services available in the UK care system and the costs involved, financial advisers can initiate conversations with clients to encourage forward planning for this complicated topic. Planning gives families time and distance to prepare, away from an emergency and leads to better outcomes.
A simple way of providing this advice is through Ingenious Care services. This is a complimentary advice service available to investors in Ingenious Estate Planning (IEP), offering bespoke advice to individuals and their families to help navigate the complexities discussed within this article. Our nationwide team of dedicated care advisers provides help and support on all aspects of care, whether planning ahead or facing an emergency. They help people make the best possible decisions and avoid costly mistakes.
Sources
1AgeUK , 2019, 2LaingBuisson, 2014, 3Kings Fund, December 2018, 4Grace Consulting market research, Q1 2020.
First published on Wealth Adviser.
The Covid-19 pandemic has shone a spotlight on the UK’s later life care system. Like many essential services, it has come under extreme pressure and is rising to this enormous challenge, but it is a worrying time for those who are in care or need to consider care services for themselves or their family. Financial advisers should be involved in every aspect of later life planning for their clients, including preparedness for professional care, so we spoke to one of the country’s leading care advisers to find out more about the pressures and complexities of the care system during this crisis.
Grace Consulting provide families with bespoke, independent advice on how to find the best possible care solutions for their needs and wishes.
As with all key services, the care system is learning as-we-go with this new virus. Care homes have had to close their doors to visitors, which can be distressing for residents and their families and shielding at home can lead to social isolation. Patients are being discharged from hospital more rapidly than usual and there are staff shortages, due to self-isolation and the stress and emotional strain being put on carers. According to LaingBuisson, as of 15 April 2020, an estimated 12% of care home front line staff were unavailable for work. Care facilities are having to rapidly adapt existing practices, causing disruption within homes and agencies. It is a very complex combination of conditions to navigate while prioritising the best interests of the individual.
At Grace Consulting, we are reassured that in most cases our clients with care in place are managing well. When Grace Care Advisers call to check how they are managing, they rarely express concern about the current situation, just gratitude to the dedication of their carers. For example, carers in care homes are making great efforts to take phones to people and to help with tablet video calls (not always with total success!). Some are sending regular photographs to families. Each kind intervention helps to keep families in contact and reduce anxiety.
These unprecedented times have brought to the fore the benefits of planning for later life. There has inevitably been an increase in the need for rapid decision making where people have been taken urgently to hospital due to sudden illness and where families have been unable to visit due to social distancing and restrictions on movement of people.
Additionally, we have witnessed a more acute focus on mortality across the population. This has brought about an openness to discuss, plan, and increase propensity to engage in conversations about later life care between family and loved ones. We hope that once the pandemic is over, and we can meet up again with our family and loved ones, we will continue to see the benefits of this. Financial advisers and independent care advisers can help facilitate these conversations and make sure that funds are in place to help realise these plans if the time comes.
Yes. This pandemic has shone a light on the importance of the care sector and its incredible work. An increased awareness of the hugely valuable and onerous role carers play has garnered new respect for the sector. Services have ramped up in an extraordinarily short time period as the Government has been forced to fast track initiatives that have been on the agenda for some time. This has provided us with the tools we require to continue to meet our client’s needs. We have been able to offer advice based on new and fast-changing guidelines and maintain open lines of communications with care facilities so families can continue to monitor the care provision of loved ones. We have worked with various agencies and government bodies to accommodate demand for temporary care after hospital discharge as well as working with individuals to plan for longer-term solutions. All this has been enabled by a streamlined communication between health and social care bodies.
This experience should encourage people to start planning for care earlier than before, to put contingency plans in place and where necessary consider setting up powers of attorney, not just for finance, but also for health and welfare. This gives individuals the control over decisions that may be made for them in an emergency and loved ones the confidence that they are doing the right thing by the individual.
We have also seen the incredible support technology can give in times of emergency or isolation. We encourage every family to set up smart phones and tablets that can enable them to continue communicating with loved ones. Something we are no doubt all benefiting from at the moment.
The bespoke and independent guidance services of Grace Consulting are available as a complimentary facility to all investors in the Ingenious Estate Planning range of services. Speak to your local professional Ingenious contact or get in touch for more information.
The Covid-19 pandemic has created a huge need for specialist care for vulnerable people in the UK. Be it an emergency care requirement, assistance with avoiding social isolation, or support for a family unable to visit a loved one in a care facility, the Ingenious Care Service provides bespoke support for our investors and their families.
The Ingenious Care Service is available at no cost to Ingenious Estate Planning investors, and their families, who select the additional Care service when they invest. The specialist support is provided by market leader Grace Consulting, to help investors plan for later life care needs, whenever they need it the most.
There is currently a raft of information from the Government and care facilities, making an already complex system very hard to navigate. Here are some of the issues we are helping to support, but our advisers are on hand to help with your personal circumstances.
Existing Investors, or their family members, requiring support should contact Grace Consulting directly on 01483 203066 and ask to speak to your personal Care Adviser who will provide guidance tailored to your own personal situation.
Ingenious Care Services are available as a no-cost option to Investors in Ingenious Estate Planning, our market leading suite of later life solutions. For more information please contact;
Simon Harryman, Senior Business Development Director
07949 747828
As we all manage the challenges raised by Covid-19, here at Ingenious we have put together a Q&A that we hope will help our investors understand our ongoing response to Government advice.
Have Ingenious Group’s operations been impacted by Covid-19 and associated guidance?
Following the Prime Minister’s direction for the UK population to remain at home with no unnecessary travel, Ingenious has taken the decision to close our office in Soho’s Golden Square as of 24 March 2020. However, we would like to reassure all our advisers and investors that we remain fully open for business. Procedures already put in place on Wednesday 18 March ensure there will be no impact on the management of your investments. With the latest advice and office closure, we do ask that you avoid all communications by post and follow further guidance outlined below. If you have any questions regarding either new or existing investments, please just let us know via clientservices@theingeniousgroup.co.uk and we will be delighted to help.
How is Ingenious coordinating its response to Government advice relating to Covid-19?
Our response to the current situation is being led by our CEO, Neil Forster, and his Crisis Management Team, drawn from experts across the business. We established the Crisis Management Team some time ago to respond to any number of unexpected events which could have a detrimental and lasting impact on our business and on the investments we manage.
This team sets and implements our Business Continuity Plan under the guidance of our Board of Directors. Our Business Continuity Plan has been regularly tested and will ensure that our business remains very much open and fully functioning during this period of uncertainty through the implementation of remote working. As you can imagine, we have been in daily contact with each other over the last couple of weeks, anticipating exactly this sort of business outcome.
What steps are Ingenious taking to maintain effective management and stewardship of my investment(s)?
Effective management and stewardship of our clients’ investments is at the forefront of priorities during our response to Government advice. To protect the well-being of the Ingenious team and the communities we operate in, our colleagues will be working remotely over coming weeks and we have taken extensive measures to ensure we can continue to deliver the high level of governance and operational efficiency that our clients are used to.
We have ensured that everyone in our business has access to the hardware and software they require to work remotely for an indefinite period, including team collaboration software and business continuity processes. We have made arrangements for those of our team that require access to specialist systems whilst working remotely, such as finance systems, client relationships software and other specialist valuation models for example. We have also been working closely with key business partners, such as our custodians, and have received confirmation of the steps they have taken to ensure continuity of support to you and your clients. We will remain in heightened contact with all our business partners during this period of uncertainty.
As an investor, are there any steps I need to take in relation to my investments with Ingenious?
Our investors do not need to take any action. Our investment teams will continue to actively monitor all our existing investments and we will keep you informed of any material developments on a specific investment basis. In the meantime, we would encourage you to use myIngenious to view the latest reporting and commentary for all existing investments. If you do not yet have access to this, please get in touch via clientservices@theingeniousgroup.co.uk and we will be happy to organise this for you.
How do I make an application for a new investment at this time?
We are very much open to receive and process new applications, though encourage investors to do so by email, online documents and electronic payments as outlined below, so we can process your application as quickly as possible. Please avoid hard copy applications and cheques where possible.
*Please edit to reflect the signatory type and insert the full name of the signatory after the statement.
As Government advice continues to change, please refer to this page which will be updated regularly.
If you have any questions, we are here to help. Please let us know by emailing us at: clientservices@theingeniousgroup.co.uk.
Ingenious is proud to congratulate Renée Zellweger on her Academy Award® for Best Actress for her role as Judy Garland. Judy was produced by Confit Productions, an investee company managed by Ingenious, with partners Pathe, BBC Films and Calamity Films.
The Oscar® win completes a busy awards season for the film during which Renée Zellweger won every major award for Best Actress, including the Golden Globe, the Screen Actors Guild award and the BAFTA award.
To date the film has achieved over $39m in Worldwide Box Office, including $24m in North America, where it was released by LD Entertainment and Roadside Attractions.
We are proud to announce that two films produced by investee companies managed by Ingenious will showcase at the forthcoming Berlin Film Festival:
We are proud to announce that four films produced by investee companies managed by Ingenious will showcase at the forthcoming Sundance Film Festival:
Ingenious Media is proud to announce that seven films produced by investee companies managed by Ingenious will showcase at the forthcoming Venice and Toronto Film Festivals.The Burnt Orange Heresy, produced by Achille Productions, has been selected as the closing film of the Venice Film Festival and will also screen at the Toronto Film Festival. Starring Claes Bang, Elizabeth Debicki, Donald Sutherland and Mick Jagger this noir thriller tells the story of an art critic who is hired to steal a painting from one of the most enigmatic artists. The operation spins out of control as he becomes consumed by his own greed and insecurity.
Seberg, produced by Nelly Films, narrates the true story of an FBI Agent, played by Jack O’Connell, who is assigned to investigate the iconic actress Jean Seberg (Kristen Stewart) when she becomes embroiled in the tumultuous civil rights movement in the late sixties in Los Angeles. The film will hold its World Premiere on the first Friday of the Venice Film Festival and subsequently at Toronto.
Military Wives, produced by Koliko Films, stars Kristin Scott Thomas and Sharon Horgan who start a military wives choir whilst their husbands are on a tour in Afghanistan. Music and laughter transform their lives as the women help each other overcome their fear for loved ones in combat. The film will hold its World Premiere at Toronto;
Tim Roth and Clive Owen star in The Song of Names, produced by Riba Films, which will also premiere at Toronto. This emotional detective story is spread over two continents and half a century. Beneath the film’s stunning musical revelations burn the horror of a war and the lost souls extinguished from history.
Dirt Music, produced by Pelgo Films, will premiere at Toronto. The films tells the story of a woman stranded in a relationship with a man she doesn’t love, in a small fishing village on the coast of Australia. An encounter with a local pariah results in an affair that dredges up secrets and changes all of their lives. Starring Kelly MacDonald and Garrett Hedlund, and from the producers of Brooklyn and Lion the story is based on the award-winning novel by Tim Winton.
Patrick McKenna, founder of Ingenious, has been selected as a member of the judging panel for this year’s Achates Philanthropy Prize. He will also chair the panel for the individual prize.
The Achates Philanthropy Prize is a national campaign to promote giving to the arts. It celebrates businesses, individuals and trusts that have supported culture for the first time within the last 12 months, with the aim of encouraging cultural organisations to engage more with first-time donors to advance the arts.
There are two awards, one for a business and one for an individual or trust. The winners will be appointed as custodian of one of the two prize sculptures for a year, while their nominating cultural organisation will receive a £5,000 donation from the Achates Philanthropy Foundation.
The 2019 Call for Entries opens on Monday 1 July, and both Awards will be presented at a special event at Rich Mix on Tuesday 19 November 2019.
For more information and to find out how to apply, please visit: www.achates.org.uk.
