An independent (financial adviser’s) view

I hadn’t reckoned on this happening. An author actually read and replied to one of my book reviews. The problem is that it wasn’t one of my most flattering and I now feel guilty. To actually write a book is quite a thing, getting it published another still and finding anyone to buy and read it an achievement - just walk into any Waterstones and see how many thousands are in print at any given time. So, sorry, Ben Aitken; although he did, with humility, say that it could easily lose a hundred pages. Anyway, it’s forty years since Frankie’s ’Two Tribes’ (parents/kids etc.) was in the charts, a reminder of the circles and rhymes of history as we’re back in a Cold War, even down to prisoner exchanges. And back to the 1930s, with racists rioting on the streets. This, however, made me smile: I bought my friend an elephant for his room. He said ‘Thank you’. I said ‘Don’t mention it.’ You're right, it doesn't take much...

“Bank of England cuts interest rates to 5%”

It’s not a big cut, just 5% of 5.25% to 5%, in fact, a quarter of a percent or 25 basis points as they insist on calling it. It won’t, in the scheme of things, make much difference to your mortgage if you have one or your savings if you have any.? It is, however, an indication of the ‘direction of travel’, in other words, rates will continue to fall over a period, probably of years. The consensus seems to be that around 3.5% is where they should eventually settle. Much higher, of course, than they were for some ten years, but nowhere near the 16% that many continue to remind me that they remember ‘and we coped so they should all just get on with it' etc.. Anyway, potentially good news for both our economy and your investments. Particularly if the US follows suit.

“We’ll have to increase taxes, says Reeves”

You heard it here last, and you’ve already heard plenty of it here already in recent weeks, alas. Of course some taxes will have to go up, but none that will affect working people. So it’s likely to be those layabout rich fat cats paying high rate tax, with investments, savings and decent pensions. Yes, probably me and many of our clients, if the many rumours are to be believed. But what can we do? If we don’t feel like one of those with ‘broad shoulders’, it’s not going to be that easy to suddenly become the sort of ‘hard-working family’ that won’t be affected. And if the model of draft legislation for the one tax rise already announced is followed, taking pre-emptive action won’t help, as it effectively says that private school fees paid in advance will still be VAT-able. We don’t know where the bombs will drop, so no point in staying in the shelter until 30th October. Que sera, I’m afraid.

“Average rental cost breaks 2023 ‘ceiling’, rises to ￡1,470”

Surely if you can afford to pay nearly ￡1,500 in rent, you can afford a mortgage? Well, yes, depending on the term, interest rate and so on, quite likely a mortgage of around ￡300,000. Yet around 35% of us are renting, rising to over 40% of 25-40 year-olds. So what’s the problem? Deposits and income levels. The old dilemma, if you’re renting and it’s costing you that much, how can you save? Few can and as a result it’s only those with generous (or, sadly, dead) parents who might have enough to put down. And even if two of you are on an above average salary, average being currently around ￡35,000, you’ll struggle to meet most lenders affordability measures. Will building lots of new houses in a field near you help the cause? Not for quite a while, I fear.

“Regulation now makes crypto a viable asset class”

So what’s going on with the crypto currencies? Are they/ is it now a mainstream thing? Still much contradictory stuff, I’d say. In the same week as a headline saying it’s all good, our regulators are now regulating it, came news of big fines for a money exchange firm letting money launderers launder on the nod using crypto currencies. And yet in the US, Kamala is getting a hard time for ‘ignoring the future’ and not speaking at a big crypto conference already featuring both Trump and Kennedy. The trouble is that proper regulation of anything online seems pretty much impossible if you live in a half-decent democracy. Try doing anything dodgy in China or many a middle-eastern state and you’d soon have men in suits or uniforms knocking at your door; but their definition of dodgy is probably very different to ours. So my advice, if you’re not a drug dealer and/ or don’t have money to burn, is still to avoid.?

Having just finished 'Went to London, Took the Dog', Nina Stbbe’s latest, I revisited her first, ‘Love, Nina’, and realised that it should have been on my recent list of ‘books I liked so much I read them again’, immediately in this case. It was?based on letters to her sister and memories of her time as nanny to the children of a high-powered London literary editor. Nina is an innocent from Northampton, and has no idea, when the likes of Alan Bennett come round for tea, that she is rubbing shoulders with the great and the good. She’d been hoping she might bump into Elton John or Johnny Rotten. And this, coupled with her beautifully dry style, led me to write at the time that ‘I haven’t laughed so much in years’. Her new diaries are a return to literary north London after separation and with grown-up children. We all change, and the change is from not knowing to knowing a lot, as she is now part of that world and name-dropping rather than looking?on with an outsider’s eye. Still flashes of hilarity, but if you haven’t already, start with her first.