While inflation is stabilising in many major economies, markets continue to experience some volatility, which may have affected your investment portfolio. 

According to the latest International Monetary Fund’s Global Financial Stability Report, markets could be underestimating the risks of conflicts and upcoming elections.

Indeed, the rising price of gold suggests some investors are seeking a safe haven amid news of interest rate cuts, the upcoming US election, and escalating tensions in the Middle East. On 18 October, the price of gold hit $2,700 (£2,083) an ounce for the first time.

Read on to discover what else may have affected your investments in October 2024.

UK

The headline news in the UK in October 2024 was chancellor Rachel Reeves’ delivery of the Autumn Budget – the first from the Labour Party in 14 years. 

She announced a raft of reforms, including £40 billion in tax rises to address the “black hole” in the public finances. Among the announcements were changes to Capital Gains Tax, Inheritance Tax, Stamp Duty, and employer National Insurance contributions. 

Following the Budget on 31 October, the FTSE 100 – an index of the 100 largest companies on the London Stock Exchange – slumped to its lowest level in almost three months as investors reacted to the updates.

The latest GDP figures released by the Office for National Statistics (ONS) offered some welcome news. After the economy flatlined in June and July, it returned to growth in August and was up 0.2%.

Inflation figures were also positive. The ONS data shows that inflation was 1.7% in the 12 months to September 2024 – the first time it’s been below the Bank of England’s (BoE) 2% target in three and a half years.

The news led to the FTSE 100 rising by 0.65% on 16 October. 

Inflation falling paves the way for the BoE to make further interest rate cuts, which would be welcomed by borrowers. Indeed, the BoE hinted that it could be more aggressive with rate cuts in the coming months. 

Lower interest rates could boost the property market, and homebuilders benefited from the BoE’s outlook as a result. On 3 October, Persimmon was the top riser on the FTSE 100 after a 3.1% increase. Vistry and Barratt also gained. 

Yet, it wasn’t all good news for the housebuilding sector. Just days later, Vistry issued a profit warning and said this year’s pre-tax profits would be around £80 million lower than expected. The announcement led to shares in the company plunging by almost a third. 

Data suggests the manufacturing sector is struggling. According to S&P Global’s Purchasing Managers’ Index (PMI), confidence in the sector suffered its biggest drop since March 2020 in September. The fall was linked to the Autumn Budget with businesses reportedly taking a “wait and see” approach before making decisions. 

Overall, business outlook could be gloomy. Trade credit insurance firm Allianz Trade predicts UK business insolvencies will rise by 5% this year when compared to 2023 to more than 29,000. That figure would be a 12-year high and around 30% above pre-pandemic levels.

However, some businesses are bucking the trend. At a time when many other retailers are struggling, fast-fashion giant Shein’s UK arm reported sales surpassed £1.5 billion for the first time in 2023, up from £1.12 billion in the previous year. 

Europe

The eurozone’s key data is similar to the UK.

In the 12 months to September 2024, inflation in the eurozone fell below the 2% target to 1.7%. The news led to the European Central Bank (ECB) cutting interest rates for the third time this year – all key rates were trimmed by 25 basis points.

However, the ECB warned that inflation was expected to rise in the coming months.

PMI data indicates the eurozone economy is stuck in a rut. In October the PMI reading was 49.7 after a slight rise from 49.6 in September – only a figure above 50 indicates the economy is growing.

The manufacturing sector in particular is struggling, with a PMI reading of 45.0, indicating contraction. The bloc’s two largest members are dragging the figure down. Germany recorded its worst decline in factory conditions in 12 months, and France’s manufacturing sector is also contracting. 

The UK wasn’t the only country to review taxation in October. According to Bloomberg, Italy’s finance minister said it plans to raise taxes on companies that have benefited the most from the economic turbulence of recent years to bring down the country’s deficit. 

In response, Italy’s MIB share index, which tracks the 40 leading companies listed on the Borsa Italiana, fell 1.35% on 3 October. 

US

Official figures show inflation in the US continues to near its 2% target when it fell to 2.4% in September 2024.

After recent concerns that the US economy could fall into a recession, job data indicates the economy isn’t weakening and businesses are feeling confident. According to the Bureau of Labor Statistics, the number of jobs increased by 254,000 in September.

The data led to the dollar rising and Wall Street rallying on 4 October. On the back of the news, the Dow Jones Industrial Average was up 0.55%, while the S&P 500 gained 0.75%, and the Nasdaq jumped 1.2%. 

Asia

China and the EU continued their trade tit-for-tat, which had a knock-on effect on French spirit makers.

At the start of the month, the EU voted to increase tariffs on Chinese-made electric vehicles from 10% to up to 45% for the next five years. Beijing labelled the tariffs as “protectionist” and, just days later, announced temporary anti-dumping measures on imports of brandy from the EU. France’s trade ministry said the measures were “incomprehensible” and violated free trade.

Among the French companies affected were spirit makers Remy Cointreau and Pernod Ricard, which saw shares fall by 8% and 4% respectively on 8 October. 

A Chinese press briefing also affected markets when investors were disappointed that officials didn’t announce any major stimulus measures. On 9 October, the Shenzhen Composite Index tumbled by 8.2% – its biggest fall since 1997 – while the Shanghai Stock Exchange lost 6.6% and the benchmark CSI 300 fell by 7.1%. 

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. 

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

If you’ve ever struggled to find motivation, you’ll know how draining it can feel to push through and finish your work.

Getting out of a rut can be difficult, but is far from impossible. Finding a way to boost your creativity and approach your work with fresh eyes can help you leap back into your projects with renewed energy.

Indeed, recent research from Stanford University has found that changing your location could help you escape a creative rut.

Read on to discover why it’s important to find your motivation again and simple tips on how you can boost your creativity.

What is a “creative rut”?

We’ve all fallen victim to a creative rut at some point or another. Suddenly, a project that you used to be excited about stops being so fun, you lose inspiration, and working on something you used to love feels like a chore.

This can look like:

• Long-term procrastination
• A feeling of monotony
• Struggling for inspiration or motivation
• A lack of new ideas.

Creative ruts can often go hand in hand with burnout, which occurs when you spend a prolonged amount of time working too hard without taking breaks.

Why is it important to break out of a creative rut?

Creativity offers lots of benefits to your mental health and productivity across all areas of your life.

For example, creativity can:

• Increase workplace success
• Help you maintain loving relationships
• Improve healthy psychological functioning.

It’s also important to remember that everything you create, no matter how big or small, has the potential to improve people’s lives, whether that’s by bringing a smile to their faces or inspiring others to create their own art.

Changing your location could help you escape a creative rut

During their research, the Stanford scientists aimed to discover whether a change of location and a walk could improve their participants’ creativity.

Across their studies, they found that the participants who walked – no matter the distance or location – had an average increase in creative output of around 60%.

Furthermore, walking exhibited a residual effect on creativity. Not only did the participants’ creative output increase during a walk but their subsequent seated creativity after a walk was much higher than the group who remained seated the whole time.

To see how the location change affected the participants’ creativity, they also had them sit and walk in various locations. 

They found that all the participants – including the ones who didn’t walk at all – had a slight increase in productivity when moved from one location to another between tests.

5 practical ways to leave a creative rut behind

With this research in mind, there are a few tricks you can try if you need to escape a creative rut.

1. Go on walks

Adding a walk to your daily routine can help you boost your creativity and hopefully spark some much-needed inspiration.

One interesting thing the study concluded is that walking indoors on a treadmill was as effective as when the participants walked outdoors on a bustling university campus.

So, whether you take a stroll through your local park, walk to work, or invest in a treadmill, getting your body moving can help you regain your motivation.

2. Switch up your location

If you’re used to working in one location, you might be able to spark inspiration by moving your project somewhere else.

For example, if you usually work at your desk, then try taking your laptop to the kitchen table or meeting room, or even further afield, such as your local café.

3. Try something new

Trying something new can help you find a new perspective if you’re stuck on a specific aspect of your project.

For example, if you’re suffering from writer’s block, then why not try taking your current project in a completely unexpected direction?

Moving onto another aspect of your creative project and returning to the part you struggled with when you have more motivation and experience can help you power through the tough parts of your creative journey.

4. Look for inspiration

If inspiration isn’t coming naturally to you, sometimes you must hunt it down.

Speak to the people who motivate you, whether this be supportive friends and family members or a mentor who can help you with your creative project.

Enjoying other people’s art can also spark inspiration. Wander around a gallery, read a fantastic book, or watch a new movie to refresh your love for your project and generate some ideas.

5. Take a break

Working and thinking about a creative project non-stop can lead to burnout.

Instead of trying to force the motivation to come back to you by trying these other tips, sometimes you just need a break. 

Spend a few days or even a few weeks if you can indulging in your other hobbies or completing other work projects. When inspiration inevitably hits you again, you can jump back into your project with renewed energy and enthusiasm.

As a self-employed worker, managing your finances can be more complex. One area you might have overlooked or be unsure where to start with is saving for your retirement. 

According to the House of Commons Library, there are 4.24 million self-employed workers in the UK as of July 2024, and research indicates many don’t understand pensions.

Indeed, an interactive investor survey asked self-employed workers three basic pension questions and found that just 9% could answer all three correctly. 

You’re responsible for managing your wealth to secure your future financial security and freedom. So, even if retirement is decades away, spending some time understanding your options and which is right for you could be valuable.

You might have money set aside, such as savings or investments, that you’ve earmarked for retirement. While these options could offer more flexibility, you may be missing out on thousands of pounds that could boost your retirement income by not contributing to a pension. 

So, read on to discover the pension basics you need to know. 

Pension contributions benefit from tax relief

One of the key reasons why pensions are a tax-efficient way to save for retirement is that your contributions benefit from tax relief. 

To encourage people to save for their future, some of the money you’d have paid in Income Tax will be added to your pension instead. As a result, it provides a boost to your retirement savings.

The amount you receive through pension tax relief depends on the rate of Income Tax you pay.

So, if you’re a basic-rate taxpayer and want to boost your pension by £1,000, you’d only need to add £800 as you’d receive a further £200 in tax relief. For higher- and additional-rate taxpayers the amount would fall to £600 and £550 respectively. 

Usually, your pension provider will automatically claim tax relief at the basic rate for you. If you’re a higher- or additional-rate taxpayer, you’ll need to complete a self-assessment tax return to claim your full entitlement. 

You should note that the Annual Allowance limits how much you can contribute to your pension while retaining tax relief. For most people in 2024/25, the Annual Allowance is £60,000 or up to 100% of annual earnings. However, your allowance may be lower if you’re a high earner or have previously taken a flexible income from your pension.

If you’d like to understand how much you can tax-efficiently contribute to your pension, please contact us.

Pension contributions are invested tax-efficiently 

It’s not just tax relief that makes pensions tax-efficient either – they also provide a tax-efficient way to invest. 

To provide your retirement savings with an opportunity to grow over the long term, they will typically be invested. Investments held in a pension are not liable for Capital Gains Tax. So, if you want to invest for a long-term goal, a pension could make sense. 

Keep in mind that all investments carry some risk. Whether you’re investing in a fund in your personal pension or in individual assets through a self-invested personal pension, it’s important to consider what level of risk is appropriate for you and your financial circumstances.

You can access your pension savings from age 55

The interactive investor survey found that just 25% of self-employed workers aged between 35 and 54 knew when they could access their pension savings.

Normally, you can start to withdraw money from your pension when you turn 55 (rising to 57 in 2028). So, you might be able to access your pension sooner than you expect. You could even start to access the savings while you’re still working, which may allow you to phase into retirement gradually. 

There are tax benefits when accessing your pension too. 

If your total income exceeds the Personal Allowance, which is £12,570 in 2024/25, your pension withdrawals will usually be liable for Income Tax. However, you can take 25% of your pension (up to a maximum of £268,275 in 2024/25) tax-free – something that fewer than 1 in 5 middle-aged self-employed workers knew.

There are several ways to create an income once you’re ready to retire. You could:

• Purchase an annuity to generate a regular income for life
• Create a flexible income through drawdown
• Withdraw lump sums.

You may also mix the above three options to create a retirement income that suits your lifestyle.

So, a pension provides a tax-efficient way to invest for your future and could offer more flexibility than you expect when you reach the milestone. 

As a self-employed worker, you’ll be responsible for opening a pension, managing your contributions, and ensuring you’re on track for the retirement you’re looking forward to. If you’d like support planning your retirement, we’re here to help. 

Contact us to discuss your pension and retirement

Whether you’d like to discuss opening a pension or review your existing retirement savings, please contact us. We can work with you to create a financial plan that balances your savings towards your short- and long-term goals.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.  

Levels and bases of, and reliefs from, taxation are subject to change and their value will depend upon personal circumstances. Taxation and pension legislation may change in the future.

Drawdown pension plans (unsecured income) are complex and are not suitable for everyone. Pension decisions can affect your income for the rest of your life (and that of any partner and other dependants). Where benefits are accessed on a flexible basis, these are not fixed or safeguarded for life. If security of income is important to you then you should consider purchasing an annuity or taking a scheme pension to provide a secured level of income.

If you’re working and contributing to your pension, you might think you don’t need to do any more retirement planning just yet. However, seeking retirement advice in your 30s and 40s could mean you’re in a better position when you’re ready to give up work.

According to a survey published in IFA Magazine, putting off retirement planning is something many workers are guilty of.

Indeed, it found that just 5% of Brits aged between 35 and 44 had taken financial advice to help them prepare for retirement. Even among older generations, many haven’t sought professional support – only 10% of 45- to 54-year-olds and 21% of those aged over 55 had sought retirement advice. 

Here are five smart reasons why you shouldn’t put off planning for retirement, even if the milestone is decades away. 

1. A goal could keep you on track

If you’re not sure how much you need to save for the retirement you want, it can be difficult to understand if you’re on track. Setting a goal could motivate you to contribute regularly or even increase how much you’re adding to your pension. 

The final goal for your pension can seem like an impossible challenge. Remember, it’s not just your contributions that will support your long-term goals, but often employer contributions, tax relief, and investment growth too. So, understanding how your pension will grow could make your target seem more manageable. 

2. Identifying a gap sooner could mean you have more options

When you review your pension alongside your retirement aspirations, you might find there’s a potential shortfall.

The good news is that by identifying the gap in your 30s or 40s, you could have more options. For example, you might adjust your retirement date or planned retirement lifestyle.

Alternatively, with decades until you’re ready to give up work, you could increase your pension contributions to bridge the gap. As your pension is usually invested, increasing contributions sooner could mean a relatively small increase to your regular contributions has a much larger effect on the value of your pension at retirement than you expect. 

3. Discover if you’re making the most out of your pension savings

Reviewing your pension now could help you discover ways to get more out of your savings. 

To encourage workers to save for the future, you often receive tax relief on your contributions – so, some of the money you’ve paid in Income Tax is added to your pension. In 2024/25, your total tax-relievable contributions, including those of your employer plus tax relief, can equal up to 100% of your annual earnings or a maximum of £60,000; this is known as the “Annual Allowance”.

Your pension provider will typically claim tax relief at the basic rate on your behalf. However, if you’re a higher- or additional-rate taxpayer, you’ll need to complete a self-assessment tax return to claim your full entitlement. You can only claim back tax relief from the last four tax years. As a result, putting off reviewing your pension until you retire could mean you miss out on tax relief. 

You should note that if you’re a high earner or have already taken a flexible income from your pension, your Annual Allowance may be lower. Please contact us if you’d like to discuss how much you could add to your pension tax-efficiently. 

There could be other ways to boost your pension that you may have overlooked too. For instance, your employer may increase their contributions in line with yours. 

4. Review how you invest your pension

Normally, your pension will be invested. This provides your retirement savings with an opportunity to grow. 

As you’ll often be investing for decades through a pension, the performance of your investments could have a huge effect on the income you can create later in life. Taking financial advice in your 30s and 40s could offer a valuable chance to check your pension is invested in a way that aligns with your risk profile and goals.

While investment returns cannot be guaranteed, we could also work with you to help you understand how investment returns might provide long-term financial security.

5. You could discover you’re able to retire sooner than expected 

If you could retire five years sooner and still be financially secure, would you?

One of the challenges of retirement planning is calculating how much you need to save to be financially secure for the rest of your life. You might worry about running out of money in your later years or not having enough to cover unexpected costs. 

An early pension review could highlight that you’re in a better financial position than you expect and give you the confidence to retire sooner.

Contact us if you’d like to talk about your retirement plans

Whether retirement is just around the corner or decades away, we could help you plan for retirement. With a tailored plan, you could find you’re in a better financial position and have more freedom when you’re ready to give up work. Please contact us to arrange a meeting.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.  

Levels and bases of, and reliefs from, taxation are subject to change and their value will depend upon personal circumstances. Taxation and pension legislation may change in the future.

The value of pensions and any income from them can fall as well as rise. You may not get back the full amount invested.