Advance Group
Looking back at previous newsletters, they are reminiscent of a drunk trying to find his way home. They know they should get somewhere, can’t quite remember where it is, and have no particular idea of which is the best way.
So this one is different. This is the fine upstanding, teetotal clergyman of newsletters. A definite destination, a sturdy pair of brogues, and a fully charged sat nav. In a break from tradition this newsletter has a theme and something to say.
The theme is numbers, so what may you ask does it have in common with the Women's Global Challenge in Washington DC, the Farnborough Air Show, the Harry Hardy Peach Lecture or the conference of the European Association of Social Anthropologists??
The answer is simple…they all come round every 2 years. (although we are intending to resign from this club and increase frequency)
See what we did there, introduced the theme with the number 2. Anybody not following this should stop reading now and turn on the telly, “I’m a celebrity and can’t believe it’s not butter” has just started.
Consider these things: -
- Degrees
- Coins in a Fountain
- Steps to Heaven
- French Hens
- Blind Mice
- Wise Men
- Little Maids From School
The perceptive amongst you will have noticed a link, and that is of course 3.
Three is the Carlsberg number, probably the best number in the World.
WWW, BBC, IFA, FBI, RAC, FSA……….all instantly recognisable by their three letter initials. Perhaps FSA is not immediately apparent to all of you, it could be Food Standards Agency or Financial Services Authority. Obviously to us it is the latter, but imagine if they got confused and IFAs were regulated by the shouting judges from MasterChef, or worse, Gary Rhodes. On the other hand could they make more of a dog’s dinner of it than the other bunch?
Research has shown that when faced with more than three initials, confusion reigns supreme, and goldfish memory syndrome sets in, such that no matter how long the acronym, only the first three letters can be recalled. Experts have suggested that this is the reason Del Boy and Rodney were largely unsuccessful with Trotters Independent Trading Company Limited.
Less than three and the user is left with a feeling of loss and bereavement and the constant nag that something is missing.
People in the more remote areas of the UK (Wales) tell harrowing tales of long passed heavy drinkers wandering the highways arm in arm with roadside patrol men, eternally searching for the elusive third initial. (This is a subtle reference to two organisations with the same two letter initials, anyone not understanding should again switch on the telly and look for anything containing Noel Edmonds).
As a rule we are happy with three, but now we are faced the five letters of the apocalypse MiFID. With five letters, one of which is not even a capital, it is clearly an abomination to all right thinking people. Furthermore it is discriminatory. Why is the first I in lower case while the second is a capital, is it any less deserving? Obviously a support group of people wearing sandals and chunky knit sweaters has been established to protect little I’s interests.
Rather that what does it mean, our first question is how did it come about?
Extensive investigation has revealed that it is a translation from the Chinese. Apparently done by the same individual who carefully translated a sign in Beijing into English prohibiting the parking of bicycles. It read
“It is here prohibition against to stop to put the bicycle and throw to lose the result complacent”
In classic Eric Morecambe style, all the words are there but not necessarily in the right order.
Similarly with MiFID. It stands for Markets In Financial Instruments Directive. (Please note use of the capital I in both words. We don’t want to be accused of anti-capitalism).
Any the wiser? Of course not, we told Ainsley Harriet at the FSA, it wouldn’t mean much to most people but all we got back was a recipe for sticky toffee pudding.
What it does do is change some of the hoops we have to jump through before we can advise you.
Those of you old enough to remember Monty Python may recall the private club in Australia where rule 1 was the every one would be called Bruce. Well, rule one in our new club is that every one will be known as a retail client, rather than a private customer. (Can you feel the difference?)
Rule 2 is that if you move overseas to join all the Johnnies in Euroland, we won’t be able to continue to advise you. Even if we learn fluent Clousseau, we’ll have to drop you like a hot pomme de terre.
All this very important stuff is contained in our new “Client Agreement” which used to be our Terms of Business letter, and to make sure you know exactly what’s going on we’ve enclosed a copy for you. Read it carefully, as apparently the implementation of MiFID is going to cost 1 billion Euros, and rumour has it that anyone who cannot answer three simple questions correctly, will have their worldly goods confiscated under ARS (Asset Redistribution Strategy), and will be deported to the Forest of Dean under ROT (Re-education of Thickos).
Be Warned!!
Following the numbers theme and having done 2 and 3 you might be expecting 4. But past performance is not necessarily a reliable guide to the future so forget it, smart Alec.
Here’s a good one, 7.
Days of the week, deadly sins, dwarfs (or is it dwarves).
Anyone of less than giant proportions will appear positively Herve Villechaize like when compared to the new Companies Act. (He was the little chap on Fantasy Island… “The plane, boss the plane” and was only 3 ft 2 inches tall).
It is the largest piece of legislation ever passed and if all the sheets of paper are put it one pile it stands 7 ft high.
If you are a director of a company you can bet your life there’ll be something in there that will affect you. Please feel free to wade through it on your own. If you’d rather not, Advance Business Consultants can make sure you’re not buried by it.
Seven is also your ISA allowance for the year, only in this case it comes in thousands. Don’t be put off by the fiddler’s elbow markets (up and down you see??), an ISA is still likely to be one of the first pots to fill with your savings. There are still some cracking good funds about and its all tax free.
The next number in the sequence is 19.
There are now 19 people working at the Advance Group. Anyone who can name them all will be reported to the police as you must have been stalking us or have been committing some devious Internet identity fraud.
Obviously personnel change over the years, but now we don’t let Ben do the interviewing any more we seem to keep people for longer.
Ben and Keith still carry out most of the regulated financial advice.
Lesley is on reception and will probably be the one who answers the phone, Karen is the office manager and compliance expert. She makes sure that if anyone from the Food Standards Agency does visit us, they won’t find any salmonella or mouse droppings. Mike, Julie, Paul and Caroline administrate and keep all our ducks in a row.
Upstairs, the accountants office is rather like Hogwarts, Lots of strange unfathomable things go on overseen by David, our own Dumbledore. Slightly shorter and a bit more grumpy than the real version but nevertheless able to produce magical results with a set of figures. The rest of them up there are John, Katy, Rebecca, Lisa, Agnes, Jo, another Julie (she’s Australian) and Dave. Then Ken and Christine do our internal financial management.
Not many of us bite, and we haven’t had to use the straight jacket for ages now, so you’re always welcome to visit (just avoid the full moon).
Its 19 months (about) since Standard Life demutualised, and it looks like our concerns about this were not without foundation. They have announced their intention to lose another 1000 jobs, but in the meanwhile three of the top men have taken whacking great salary rises. They made a complete mess of their proposed takeover of Resolution and have managed to send out the wrong details to hundreds of customers.
Furthermore the company has just announced it will be withdrawing from the protection market. This is another move towards greater profitability, and while there is nothing wrong with wanting to be profitable it is indicative of what we suspected would happen. Standard Life is no longer interested in the small investor and simple everyday products, preferring to concentrate its efforts on high value, high profit business. This is a 190 degree turn away from its traditional business base.
If you still have a Standard Life policy you might want to think about reviewing your decision.
What about the proposed new capital gains tax rate? Another 18. At the moment if you have a capital gain it is added to your normal income and taxed accordingly.
In the future everyone will pay CGT at 18%. Good news for higher rate tax payers. Obviously, as with any change to the tax regime, there are loads of long words in tiny print that could have an effect so if this is a worry give one of our tax boffins a ring. (01225 338600)
The figures become a bit larger at his point. 3600 is a popular number with manufacturers of electronic equipment. Nokia makes a 3600 mobile phone.
There is an indestructible iPod cover with that number. (Apparently after having been tested to destruction it was deemed to be indestructible. You would have thought they might have found something a bit more fundamental to use such an astounding compound for, than protecting a music player).
Evidently one of the best digital film scanners on the market is the 3600.
All good stuff but of little consequence, unless of course cars, planes and other things that carry people start being made of iPod covers. However £3600 is the amount anyone from the age of 0 to 75 can put into a stakeholder pension in a year.
That really is right, as long as the individual has moved from foetus to real wailing baby, he can have a stakeholder pension.
No income is necessary and anybody can make the payments. Take note Grandma.
Imagine that, the apple of your eye comes out of University at age 23, with a degree in contemporary wombling, and a pension fund of about £175,000 before he’s even started work. Think of it as an investment in your own future. He’ll be able to retire early and will be able to afford to put you in a home.
The last and biggest number of all is 24billion. This is reportedly the amount we, the Great British Taxpayer lent Northern Rock. It would take over 900,000 years for someone on an average salary to earn that much.
Even at his monumental salary, Michael Schumacher, the highest paid sportsman ever would have had to keep his foot on the pedal for over 400 years.
Presumably the name Northern Rock was chosen to convey stability and longevity, with the benefit of hindsight, Northern Marshmallow might have been more appropriate.Of course if King Richard of Branson takes over it could become Northern Virgin. That’s going to be interesting if you put that in your Internet search engine.
Any of you with a mortgage or savings with Our Friends in the North, should not panic, but it would certainly be a good time to review. One of the effects of this situation has been to contract the non-standard mortgage market.
For most of you fine citizens this will have little effect, but anyone deriving income from something other than a straightforward PAYE salary may find loans a little harder to come by.
Buy to lets, self-certification and anything sub-prime could be a little prickly in the next few months. This means if you are in one of these categories you’re going to need more time to sort it out. We can help but don’t leave it until the last minute to call us. We can do miracles but they tend to take a while.
Don’t forget your self-assessment return will be due shortly after Christmas. The boys and girls of Advance Business Consultants are pacing the floor in eager anticipation of the annual onslaught. They look forward to this time the whole year and have sharpened their pencils and polished up the balls on the abacus.
So if you need any help give us a call, but don’t leave it too late.
Finally, we would like to be able to send this newsletter out to everyone by e-mail, so if you have received it through the normal post, we’d be really grateful if you could send us your e-mail address. We promise not to send adverts for Viagra or dating services and we won’t offer you the opportunity to invest in a Nigerian money transfer scheme as long as you send us your bank details.
Please e-mail us at harrold@advanceinvestments.com
Merry Christmas one and all and one last thought, if you’re driving this yuletide, don’t forget to take the car.
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