23 May Planning for the General Election
We’re readying ourselves for a snap election. Many of our clients will be asking themselves and their advisers ‘what does the vote mean for me?’ and if you’re reading this article when it was published at the end of May, you have just over a week to decide how you will vote in the general election.
When faced with an election, or an explosive news story, our decisions can be effected by media hype. However, we can learn from the U.S. election last November and Donald Trump’s tense election campaign. Despite many prophecies of doom, economic performance in the US has remained steady.
If we compare this month’s numbers to last November’s, the US unemployment rate has dropped1, house prices have continued to rise2 and U.S. GDP has increased to a – all traditional indicators of a healthy economy.
What’s happening in the UK?
The announcement of the snap election on 18th April caused a dip in the value of the pound and FTSE 1005. But both have rallied in the past month. The pound has recovered to similar levels, but the FTSE 100 continues to climb past April’s figures.
With these numbers, it’s important to remember that it is the nature of the markets to fluctuate – taking confidence from the prospect of relative certainty, or unnerved by uncertainty.
As investments are typically designed for the long term, we build strategies designed to ride out the peaks and troughs of economic cycles.
What might affect my finances?
Taxation and policy changes will always impact financial planning – but it’s unlikely that we’ll find out what they are, and how they’ll affect you until the new Parliament is opened.
An area where we might see the next government focus on is the Triple Lock commitment to the state pension as it confronts the affordability of George Osborne’s pledge to pensioners.
As part of our commitment to clients, we’ll keep you up to date on this topic and others relevant to financial planning. In between your scheduled Forward Planning meetings you’ll receive Money Matters, our Budget commentary, Budget summary report and regular email editions of Compass.
This article is for general information and is not intended to be relied upon by you in making or not making any investment decisions. It is recommended that you seek independent financial advice before making any financial decisions.