Are you prepared for retirement?
New research from pension provider LV has found that 66% of people between the ages of 45 to 49 feel unprepared for retirement. Half of the people surveyed also stated that they feel unsure what income option they would like to take in retirement as well.
It is important to remember that everyone’s circumstances are different and there is no one size fits all approach. The importance of flexibility, the desire for a guaranteed income and attitude to risk as well as capacity for loss will need to be considered.
It is also worth bearing in mind that it may not necessarily just be a straight choice between flexi access drawdown and annuity. A blended approach of the two strategies may work best for some people.
Changes made in the autumn budget of 2024 have added another layer of complexity as unused pension funds and death benefits will be included in the estate from 6th April 2027 unless left to a spouse or civil partner.
If you are nearing retirement, or even if this is many years away, it is important to prepare and plan in order that you meet your goals and objectives and have the retirement that you deserve. Please contact the office and we can help with retirement planning, keeping you on track to achieve your goals and IHT mitigation strategies.Darren Fuller- Clear Senior Paraplanner
Food for Thought
Jeremy Clarkson has transformed the face of farming in a remarkable way. Clarkson’s Farm is by far and away Amazon Prime’s biggest UK success story.
The super smart studio executives at Amazon Prime must be in despair with the UK market.
They plough money into big budget fantasy/action/sci-fi blockbusters, and all the Brits want to do is watch a driving journalist fail to plough a field or get hit in the privates by his own goats, or stare, uncomprehending, at Gerald!
Source: Clarkson’s Farm
This renewed focus on farming might just have come at the right time for the UK.
In the Second World War these posters were everywhere…
Source: Imperial War Museum
At this time the UK imported 55 million tonnes of food a year, almost entirely by sea. With German attacks on shipping, and capacity also needed for other bulk goods, food self-sufficiency was massively encouraged and important.
Today there are no U-boat wolf-packs in the Atlantic, but supply chains are becoming an issue again. The world is dealing with the impacts of Covid, the closure of the Suez Canal, Ukraine, tariffs, and rising tension in the Middle East, all in rapid succession.
And when it comes to food independence, the UK doesn’t stack up too well:
Self-sustaining = green, not self-sustaining = red
- We are only self-sustaining in two of the seven major food groups.
- France is covered in four of seven.
- China, despite having about a billion more people than the US, is better off.
- It’s only Guyana, in the whole world, that can support itself …
So how can we find a solution? British farming is part of it – as is high intensity agricultural-tech (we have super-productive greenhouses in Thanet).
And, of course, there’s doing it yourself. By the middle of the Second World War, over 1.4 million families had allotments and were digging for victory. There are only about 300,000 allotments in use today…
Source 7iMThe price of rice is not so nice!
ご飯 is the Japanese word “Gohan”.
For any manga fans, this note isn’t about the Dragonball Z character from your childhood…!
Gohan translates directly as “cooked rice”.
For centuries, rice has been the household staple in Japan; in the 1960s, the average Japanese citizen ate 120kg of rice each year, costing them 25% of their food budget.
Because of how important rice has traditionally been in the Japanese diet, “gohan” is regularly used to mean “meal of any sort”.
Rice = food.
This can tell us something about inflation – or rather, the psychology around it.
Because although rice consumption has halved since the 1960s (~50kg a year), and it’s only around 5% of the average food budget, the cultural importance remains.Rice = food.
So when the price of rice does this:
Source: Statistics Bureau of Japan/7IM
… it doesn’t just feel like a one-off shock, it feels like a whole way of life is being eroded.
The two psychological effects at work here are salience and anchoring.
- Salience describes the fact that as humans, our attention is caught by certain things (whether we like it or not). And in Japan, Rice = food. And of course, once people start worrying, the media amplify the issue.
- Anchoring is about where our expectations are set. It’s not just that the price of rice has nearly doubled. It’s that it’s been basically flat for the 20 years before.
The official statistics might say that core Japanese inflation is 3.1% per year… but to a family in Tokyo who are paying twice as much for rice (= food!) as they were last year, and who have been used to the price of rice being flat for two decades, inflation feels much higher!
This is making the Japanese population extremely stressed and worried about their living costs. They are blaming the government causing the agriculture minister to resign. Their elections in a few weeks’ time are going to be very interesting!
Source – 7iMBidding is big business
The most valuable painting ever sold at auction was Salvator Mundi which sold for $450m in 2017.
Source: Leonardo da Vinci – Getty Images
It was sold, broadly, in an auction process which you would expect. Something like this:
Source: Sotheby’s
A rapid-fire auctioneer gabbling and gavelling away, as people make curious gestures to signal their bid, a bit like in the painting!
But.
There are actual auctions happening constantly which make $450m look like pocket change.
In particular, Internet search. Google searches generate about $260 BILLION per year in advertising revenue*.
The sponsored slot at the top of the screen is the most valuable.
Source: Google
Of course Google doesn’t use a gavel! They use something called Generalised Second Price auctions (GSP) to try to make sure that no-one pays too much or too little:
- All sellers say their maximum bid to appear in the top slot.
- The seller with the highest bid wins.
- But they pay the next highest bid.
So, in the search above, for slot #1 Sports Direct would pay whatever Adidas had bid. And Adidas would pay whatever Hoka had bid. And so on.
This is the psychology:
- Imagine Sports Direct were prepared to bid £200 for slot #1.
- Imagine Adidas were prepared to bid £100 for slot #1.
- Sports Direct’s ideal would be to pay £100.01 –just enough to beat Adidas, and saving itself £99.99 it doesn’t need to pay.
- So, Sports Direct pays £100 (Google is prepared to miss out on the extra 1p to keep advertisers coming back)
- And Adidas’ pain at coming second is eased by knowing that it will pay HOKA’s third-place price for a second-place slot.
So, everyone’s annoyance at losing the auction is cancelled out by getting the next-best spot at a discount! And this is happening in the background every time someone searches for anything.
Lots of papers have been written on whether this is the best theoretical system, but Google has been using it since 2004 so it must be more than smart enough!
We’ll leave you with our favourite auction story.
In 2015, a Chinese billionaire bought a Modigliani painting for $170 million. And he bought it on a credit card, so that his family could bank the reward points and “continue flying for free”! That’s how you stay a billionaire…
Source:7iMOù est l’Uranium? En Afrique!
Nuclear power has been struggling with PR for decades.
That’s partly due to high-profile problems: Three Mile Island, Chernobyl, Fukushima.
…. but also, believe it or not, The Simpsons haven’t helped!
Source: The Simpsons, 20th Century Fox
Yes, really! In fact, the US Department of Energy has released a blog tackling the negative spin from Homer and his colleagues over the last three decades. – https://www.energy.gov/ne/articles/7-things-simpsons-got-wrong-about-nuclear
Why are they going after The Simpsons? Well, because nuclear demand is back, so we need to get comfortable with it!
- There’s old tech; countries like Japan, Belgium and Sweden are switching back on some of their mothballed power plants or extending the life of their existing ones. China has 23 reactors under construction. India’s planning to build 18.
- There’s new tech; Small Modular Reactors which are quicker and easier to build. Powering towns, not cities. Backing up green grids when the wind drops or the clouds come.
- And there’s new demand; over the course of the twentieth century, it was only nations who had the balance sheet and longevity to be able to fund nuclear power. But now, there are plenty of companies of nation-like size, with long time horizons and an insatiable thirst for electricity. Amazon, Meta and Microsoft have all recently signed deals for nuclear power.
This of course means that will be a lot more need for Uranium. But supply is rapidly going to become an issue. Especially for European countries like France.
Europe finds itself very much lacking in radioactive resources – and a long way away from friendly places that do.Top five global uranium producers (and % of global production)
Source: 7IM/World Nuclear Association
You would have to count Kazakhstan and Uzbekistan out (main markets are China ☹ and Russia ☹ ☹).
Canada might help, but it has the world’s largest uranium import market over the border and tariffs won’t change that. Australia has a little bit of spare stuff but is eyeing up India and Japan.
Looks like the French embassy soirees in Windhoek (capital of Namibia) are about to go up a notch…
Donna Smith
Following on from our February newsletter where we introduced Donna, an international women’s pool player who the charity sponsors, we now have some updates on her success over recent months:
- European Championship in February took place in Malta. Donna represented Scotland and made it through to the last 64 of the singles event.
- Scottish Masters in March – Donna reached the semi-finals.
- Tour 1 Greenock in March – Again Donna fought her way to the semi-final stage.
- Tours 2 & 3 Edinburgh in May – Tour 2 Donna finished a respectable 5th but put in a great performance to finish as runner up of Tour 3.
Due to work commitments, Donna could not take part in Tour 4 or the Scottish Open, but is looking forward to Tour 5 and the Scottish Ladies Singles in August playing in Aberdeen. She is also taking part in the Ladies Series in Goole and reached the semi-finals of the third event.
Playing at this competitive level is exciting and challenging, and Donna’s game continues to improve.
For further information check the website – https://clear-minds.co.uk/
The charity is currently working with 17 therapists, funding 31 past and present clients by paying more than 1354 hours of counselling.
To support this work you can donate by following this link:
https://www.justgiving.com/clearminds
