- Close to half of HNWIs have made changes to their wealth planning in the last year
- 23% have done so to support their loved ones, with one in ten bringing gifting plans forward
High Net Worth Investors (HNWIs) have been adapting their financial plans in order to support loved ones over the last 12 months according to new research from Rathbones.
Close to half of HNWIs (45%) said they have made changes to their wealth planning in the last 12 months.
A quarter (23%) of HNWIs claimed to have changed plans in the last 12 months in order to support their loved ones with key milestones. Indeed, when asked what changes they had made to their financial planning, one in ten (12%) HNWIs had brought forward their gifting plans. A further 16% said they had changed the nature of their planned financial gifts.
The upcoming General Election was another key driver for HNWIs to review their plans, with 20% saying they had been prompted to change their plans due to speculation around tax rises from a new government. Additionally, 16% said they made changes because of the predicted change in government. With the Institute for Fiscal Studies (IFS) warning tax rises over the next five years will be “hard to avoid” whatever party is in power, many HNWIs are taking early, precautionary measures.
HNWIs had also reviewed their investment strategies in light of current macroeconomic conditions, with 17% changing their strategy in the last 12 months. In addition, 25% reviewed their plans over the last twelve months due to ongoing high interest rates.
Olly Cheng, Financial Planning Director at Rathbones comments: “Economically the last twelve months have brought up many financial planning challenges. With CPI only just now back down to the 2% target and higher than usual interest rates, individuals with savings and investments will not only have to ensure they are planning effectively to prepare for the long term but may also want to step in and help support any loved ones struggling with higher costs.
“It’s encouraging to see that so many people are taking proactive steps to adapt to changes in the economic landscape. Recent conditions have made it more difficult for people to use their savings and investments to cover their own needs throughout their lifetime in addition to supporting loved ones or charitable causes. However, adjusting their short-term strategy can help mitigate these recent challenges. As with any General Election, taxation and the treatment of wealth could change with a new government so it is important to stay alert to possible measures, and taking appropriate steps now will stand people in good stead in the long term. For those who are unsure what a new government or change in policy may mean for them, speaking to a financial planner will help plan for the various potential eventualities.”
For more on what a change in government may mean for HNWIs and how to plan, please see here.
