Matthew Douglas named ‘Best IFA in East of England’ at National Awards

We’re so proud to share that we have been named as the “Best Financial Advice firm in The East of England” at the annual Citywire New Model Adviser Conference & Awards 2024.

The annual event, organised by Citywire - a London-based media group covering the global asset management industry - celebrates the very best financial planners across the length and breadth of the UK.

We faced stiff competition from many highly-recognised firms, including Beckett Investment Management Group, Chadwicks, Kingsfleet and SG Wealth Management.

Our Director, Russell Brett, attended the awards ceremony at London’s Park Plaza Westminster Bridge Hotel. He said:

“We’re absolutely thrilled to be named the Best IFA in the East of England in Citywire’s NMA Awards. We pride ourselves on providing the very best service to all of our valuable clients, both in the East of England and further afield.

“We’re constantly striving to improve our offering, and I’m so pleased that this has been recognised once again on a national level, especially after facing such strong competition against other high-performing firms in our region.

“I’d like to offer my appreciation to Citywire for once again hosting a fantastic event, and to the whole team at Matthew Douglas for their constant determination, hard work and ambition that has got us to where we are today.”

Our Managing Director, Matthew Pescott Frost, also attended the awards ceremony in London, alongside our Independent Financial Adviser, Frank Wampamba. Matthew said:

“In over 20 years of business, this company has grown into a successful, multi-award winning firm, boasting a fantastic team of individuals who go above and beyond for our clients. We now provide support and guidance to over 800 families whether they’re based in the East of England or further afield.

“This award is testament to their hard work; it most definitely is a team effort, and I was very proud to represent them by accepting this award in London alongside my colleagues, Russell and Frank.

“It’s taken sheer perseverance! We do a good job, we’ve got a great legacy team, and a young team coming through – doing our bit to help the industry develop – and we plan to consolidate next year. Our youngsters are in their 20s and they’re being primed to take over in around four or five years.

“Independent financial planning is essential. We are genuinely independent – all our shareholders actually work in the business, and not many firms can say that.”

You can read more about it here.


Citywire Outsourcing 2023

Cultivating ‘great relationships’: Matthew Douglas features in Citywire’s Outsourcing 2023 Report

What makes a perfect union between adviser and discretionary fund manager? Our CEO, Matthew Pescott Frost, explains in Citywire’s newest report.

Citywire, the financial news site, has released a special new report for investors talking about why financial advisers work with discretionary trust managers; how these partnerships are formed, and how they benefit clients.

Broken down into three distinct chapters, the Outsourcing 2023 Report explores:

  • Catalysts driving demand for outsourcing
  • Discretionary fund managers reveal their secrets for the perfect partnership
  • Outsourcing 360: what other functions are being outsourced besides investment management?

In chapter 2 of the report, our CEO Matthew Pescott Frost explains our recent outsourcing journey with Evelyn Partners, which began last year.

Under this partnership, clients with invested assets below £250,000 are offered a bespoke managed portfolio run by Evelyn, on our behalf. This constitutes nearly half of our clients, but critically only 15% of assets under advice.

Very often, these clients have less demanding portfolios, but are still growing their assets and saving for the future. Of course, this doesn’t mean that these portfolios are any less vital than our wealth clients - but it is prudent from an admin and time perspective to outsource this offering so that we can focus on the generally more  nuanced needs of our larger clients.

“The strength of any relationship is a strong mutual understanding,” explains Matthew. “We’re now 10 months into our discretionary fund manager [DFM] partnership and I can see the competitive edge it’s providing us.”

To explore what makes the perfect partnership between discretionary fund managers, read the full report here: 

https://citywire.com/new-model-adviser/special-reports/outsourcing-2023 


Citywire Top 100 NMA 2023

Matthew Douglas listed in Top 100 Advice firms for 10th year running!

We’re so proud to announce that we have once again been listed in the annual Citywire New Model Adviser Top 100, which celebrates the very best of the UK’s professional financial planning community.

Matthew Douglas Ltd is also the only Independent Financial Advice (IFA) business across East Anglia to have achieved this for ten consecutive years.

Top 100 Citywire

Here’s why we were nominated

Survey responses for the list were assessed using a point-scoring system, looking for evidence of the following:

Well-qualified staff

Robust investment propositions

Carefully segmented client bases

Good use of technology

Willingness to share best practice

Client education

Recruitment

Contribution to professional standards

….and more!

The use of a weighting system meant that large and small firms were compared fairly, to ensure that no bias was seen to larger corporations.

Citywire said: “The business, which prides itself on having a diverse range of ages, background and ethnicities among its employees, was recently nominated for a national diversity award. More than half of the firm’s employees are less than 40 years old.

“The business engages regularly with local charities and has close partnerships with local schools and universities. Its advisers offer personal finance sessions and career advice at three schools and a targeted service, called Springboard, for the children of its advice clients. The firm also offers work placements to students at Essex University.”

Here’s what our Director, Matthew Pescott Frost, had to say about the news:

“We’re absolutely thrilled to once again have been named in the Citywire NMA’s Top 100 for the tenth year in a row. It’s such an incredible achievement and one that we are very proud of at Matthew Douglas.

“It’s a credit to our whole team that we have been able to achieve this for ten consecutive years, and really reflects the hard work that everyone puts in - both when directly helping clients and all of the work that’s done behind the scenes in the office.

“To also be the only firm across the whole of East Anglia to achieve this is just fantastic. We really go above and beyond for our customers, and that’s reflected in our ability to retain this award for so many years.”

You can read more about it here.


Money questions

SJP announces fee overhaul for post-2025 clients

SJP has announced that they will be set to overhaul the firm’s fee structure following regulatory pressure, but only for clients who join them post-2025. This means that all existing clients, and those who invest with the firm between now and 2025, will not benefit from these changes.

In a Stock Exchange notice on 17th October, the £158.6bn giant said the updates will result in three key changes: the removal of early withdrawal fees, plus any new investment bond and pension business will operate with initial charges, together with ongoing charges from 2025.

SJP announces fee overhaul for post-2025 clients; Matthew Douglas

In a Stock Exchange notice on 17th October, the £158.6bn giant said the updates will result in three key changes: the removal of early withdrawal fees, plus any new investment bond and pension business will operate with initial charges, together with ongoing charges from 2025.

SJP has long faced scrutiny from industry professionals for their ‘expensive’ charges and exit penalties, and now the UK’s biggest wealth manager has bowed to pressure to ensure that it complies with new customer duty requirements. .

The changes will come into effect in the second half of 2025, meaning that clients still have to wait two years before they’ll benefit from lower fees.

The firm has also announced that it plans to improve disclosure on fees by “unbundling” them into component parts - meaning that there will now be separate charges for initial and ongoing advice, plus product administration and investment management. Currently, it discloses fees on an ‘all inclusive’ basis - meaning that many clients struggle to understand what they’re actually paying for and how much it’ll cost.

SJP has also stated that next year it will introduce a ‘more consistent’ approach to fund charges to reflect the value that each fund provides. This move comes after the firm’s share price fell by over 20% in mid-October. 

Matthew Pescott Frost shares his views on the announcement:

“These changes are ultimately all to do with consumer duty rules. SJP has got away with it for so long, but now they’ve reluctantly been forced to make these alterations - even though they’ve still got two years to go before these new rules actually come into effect. Pressure has definitely been building on them for some time now.

“The new FCA consumer duty directive means that in our industry, you now have to justify everything that you do - and rightly so! If you’re recommending a product to a client, regulators have every right to ask you to justify why you recommended it, to ensure that you’re providing the correct option and working solely in the best interests of your client. 

“We’re likely going to see some unhappy SJP clients as a result of these changes, as ultimately, their existing customers (and those from now until 2025) will still be subject to the same high fees and exit charges that we’ve become accustomed to. Share prices have been falling significantly since these rumours began, which is not a surprise.

“After 2025, we should see a much more dynamic market, as clients at SJP will be free to move if they’re unhappy without facing any large penalties. Currently, exit fees with the firm lie at 6% in the first year of investments, then slowly reducing each year for six years - meaning that it can be very difficult to move. Only after spending six years with the firm can customers leave without paying any fees - up until 2025.

“Here at Matthew Douglas, we very much welcome these new and improved consumer duty regulations. Feel free to get in touch with our advisers if you have any concerns following the SJP announcement.”

 


Romantic Senior Couple Sitting On Wooden Jetty By Lake

The hidden impact of inflation on savings

A closer look at a financial understanding among Britons

A recent study has revealed that over half of the British population may not fully comprehend the hidden impact of inflation on their savings and buying power[1]. The research explored participants’ understanding of basic financial principles, including inflation, compound interest, risk and return, and the significance of life stages in financial planning.

Surprisingly, only 44% of respondents could accurately determine the buying power of money when considering both savings interest rates and inflation. This lack of understanding persisted even among those who rated their financial knowledge as ‘very or moderately good,’ with only 50% answering correctly.

Impact of compound interest and inflation on savings
Moreover, less than four in ten (37%) participants grasped the concept of compound interest on savings. This figure rose to only 45% for those who considered themselves ‘very’ or ‘somewhat’ confident in their financial knowledge.

While it is encouraging that nearly six out of ten people believe they possess good financial knowledge, their confidence may be misplaced. Understanding the impact of compound interest and inflation on savings is essential, as these are crucial factors in making sound financial decisions.

Riskier investments are less suitable for older individuals
The study also assessed participants’ comprehension of fundamental investment principles, such as the relationship between risk and return and how risk profiles should change according to one’s life stage.

Almost two-thirds of respondents understood that higher risk generally results in higher rewards, a percentage that increased to 71% among those who were confident in their financial knowledge. However, only 48% recognised that riskier investments are less suitable for older individuals, as they have less time to recover from potential losses.

Reviewing financial choices at different life stages
This gap in understanding was more pronounced among younger age groups (under 44), with just 39% showing comprehension of the need to adjust risk profiles based on age. It is essential to review financial choices at different life stages or after significant life events to ensure they remain appropriate.

The study highlights the need for better financial education and awareness, as a lack of understanding can lead to poor financial decisions with long-lasting consequences. By improving our knowledge of essential financial principles, we can make more informed choices and safeguard our financial well-being for years to come.

Source data:
[1] The research was conducted by Censuswide with 2004 18+ nat rep between 04.11.2022 - 07.11.2022. Censuswide abide by and employ members of the Market Research Society which is based on the ESOMAR principles and are members of The British Polling Council.


Pleasant family couple sitting at big wooden table in modern kitchen

Are we entering an Investment Bond renaissance?

Exploring why they are an attractive option to mass-affluent investors

Onshore investment bonds typically carry a lower risk and contribute significantly to a well-rounded portfolio. Historically, numerous investors have opted for a 60% equities and 40% bonds split in their portfolios, as these two assets often (keep in mind, not always) exhibit contrasting performances under varying economic circumstances – a beneficial attribute during market volatility.

Following the Capital Gains Tax (CGT) changes announced in last year’s November Budget, many investors are likely considering investment bonds a more attractive option. The Chancellor’s decision to reduce the CGT allowance to £6,000 this year and to £3,000 in April 2024 means investment bonds are more attractive to mass-affluent investors who previously held money in OEICs and unit trusts.

Investment bonds offer several benefits:

Onshore bonds are not liable to CGT. Onshore bonds are treated as having already paid 20% tax on any gains when calculating a chargeable gain. In reality, the tax deducted is likely to be less than this.

They can be ideal for Inheritance Tax (IHT) planning and are exempt from IHT after seven years if held in a trust.

Investors can withdraw up to 5% of their initial investment annually without triggering a chargeable event or any immediate tax liability.

Top slicing relief available to reduce tax liability, which can eliminate or significantly reduce any tax liability when a chargeable event is incurred – helpful if investors are in the accumulation phase and are preparing for retirement (maybe a higher rate taxpayer while owning the bond, but a basic rate taxpayer when encashing).

Options to assign a bond (for example, between husband and wife). For tax purposes, the assignment will generally be treated as if the new owner had always owned it - If one is a basic rate taxpayer, they could have no tax to pay on encashment.

Have you exhausted your other tax allowances?
Changes to CGT and the tax-free dividend allowances are also likely to appeal to investors looking to reduce IHT liabilities and those who have used their Individual Savings Account (ISA) allowances or received a large windfall payment.

THIS ARTICLE DOES NOT CONSTITUTE TAX OR LEGAL ADVICE AND SHOULD NOT BE RELIED UPON AS SUCH.

THE VALUE OF YOUR INVESTMENTS CAN GO DOWN AS WELL AS UP AND YOU MAY GET BACK LESS THAN YOU INVESTED.

THE TAX TREATMENT IS DEPENDENT ON INDIVIDUAL CIRCUMSTANCES AND MAY BE SUBJECT TO CHANGE IN FUTURE. FOR GUIDANCE, SEEK PROFESSIONAL ADVICE.