Posted by: WealthIFA | May 20, 2011

Financial News Update we 20/05/2011

How has your week been? It seems to have flown by for me this week and I am not that sure where it went – are we really coming to the end of May?!…

In case you missed it, inflation was up in April from 4% to 4.5% (http://bbc.in/mKeetB).

This relates to the Consumer Prices Index, or CPI, and does not include the cost of mortgages. The Retail Prices Index (RPI) measure of inflation – which includes mortgage interest payments – fell slightly to 5.2% from 5.3% in March but it still represents a high level.

As always, this is great news for borrowers and some (cynics?) could be forgiven for thinking this has been the plan all along, to inflate away the debt we currently have in the UK?….

However, whilst inflation may be good news for debt it is not so good for those with savings on deposit.

When it comes to investing I would suggest that “inflationary risk” should be considered just as much as the “investment risk” side of things. Most clients only seem to consider the latter but the impact of inflation can be detrimental to any cash holdings over a prolonged period.

Remember, generally speaking, cash is good for emergency funds, any planned expenditure you may have and so on but is not so good for long term capital growth or income…

This Week …

Estate Planning

Caught in the IHT net: http://bit.ly/m8QyrO
Office of the Public Guardian – Attorneys: Last chance to object to fee increases http://bit.ly/lYnCaY

Long Term Care

Care home transforms a room into a 1950’s pub: http://bit.ly/jiSiRN
Care package prices set to rise across north Kent http://ow.ly/1cI5gP
Give social care the same priority as the NHS http://ow.ly/1cJf4Y
Workers to be asked to save for cost of care in old age: http://bit.ly/jAmedZ
Social care entitlement: http://bit.ly/lF0VIi

Retirement

Equitable Life payments to start in June, Treasury says http://bbc.in/kaAMHW

Investments

60 second guide to tracker funds: http://bit.ly/lizTBg
Savers in scramble for NS&I product: http://bit.ly/jYbvi8
Guide to inflation-linked savings http://ow.ly/1cIR2Q
The 10 big investment mistakes http://ind.pn/m3pKAX
Premium Bonds are a modern draw http://bbc.in/kgGuqJ

Have a great weekend!

Regards
Kieron

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