GBI Magazine’s question series returns, as we aim to find out our readers thoughts and views on some of the topics dominating the financial services and investments sector in 2024. Our most recent focused once again on a diverse range of influential topics being widely discussed, from the regulatory environments influence on tax-efficient investment recommendations, capital growth and risk when it comes to long term wealth preservation, and lastly, growth and innovation in the different tax-efficient investment strategies. Readers have shared their views, and the results have since been listed below.
1) How has the recent regulatory environment influenced your recommendations for tax-efficient investments?
Question one aimed to gain insight into participants thoughts and views in regards to the recent regulatory environment and its influence on recommending tax-efficient investments. When analysing the findings of data, the majority of participants with a leading 66.7%, stated that the regulatory environment has not impacted the recommendations that they provide to clients, with 40% stating that regulations have in fact impacted the advice that they may give when it comes to tax-efficient investments.
A standout 0% made it clear that the regulatory environment has not yet significantly changed their approach in the recommendations that they provide. Based on these results, it is visible that the recent regulatory environment has not had a substantial impact on participants and how they recommend the best tax-efficient investment options for their clients.
2) If capital growth and risk were identical across all options, which tax-efficient investment would you prefer for long-term wealth preservation?
Question two’s purpose aimed to determine which tax efficient investments would participants prefer for long term-wealth preservation if capital growth and risk were identical across all the options available. The considerable favourite is EIS/VCT’s, with a leading 80% of participants stating that they would prefer long-term wealth preservation under this investment type, ISAs fell in second place with 60% of participants feeling this investment type would be the most beneficial for preserving long-term wealth.
AIM IHT Portfolios were noticeably lower, with 13.3% optingfor this investment type should capital growth and risk be identical across all options. In the findings, pension schemes have once again fallen short with 0% of participants opting for this investment type to preserve their wealth. It is clear that there is much progress to be made in regards to pension schemes having a positive perception surrounding them, this could be due to a number of factors including a general lack of understanding in determining which option is the most beneficial with a multitude of various pension scheme options being available. The results of this question in particular show that advisers and clients alike opting for other options to preserve their wealth in the long-term.
3) In the next 5 years, which tax-efficient investment strategy do you expect to see the most innovation or growth in?
The final question examined which tax-efficient investment strategy is expected to see the most innovation or growth in, within the next 5 years. With AI, and technology ever developing with an influx of ground breaking technological advancements being made more frequently, technology-driven platforms for tax planning claimed the first place spot with 66.7% of participants stating that they see this strategy to have the most innovation or growth in. It is no secret that with the pace that technology is advancing with financial services, that the next 5 years hold endless possibilities, which is why the results of this question come as no surprise.
In second place, green or sustainable tax-efficient investments are perceived to have the most innovation or growth in the next 5 years, with organisations feeling the pressure from environment groups to become more sustainable and planet friendly, it is also extremely likely that this strategy is in for huge levels of growth within the next few years. Organisations are being held to higher standards to ensure that they are operating on a much greener approach, leading to sustainable investment types becoming ever more popularly in the near future. Alternative asset classes in AIM IHT Portfolios, along with the expansion of EIS/VCT opportunities both received 33.3.% of votes, with participants perceiving both investment strategies of having the same level of innovation or growth within the next 5 years. Time will tell which form of tax-efficient investments do truly thrive in the next few years, and we look forward to seeing all of the developments that are headed our way.
We would once again like to say a huge thank you to each and every one of our readers and followers who got involved with our most recent question series, we highly value being able to gain insight into our readers views and thoughts on many of the factors influencing our industry. Be sure to keep an eye out on our GBI Magazine, and IFA Magazine‘s social media accounts for our next topics of focus!
Discover a selection of Tax Efficient Opportunities on our Open Offers page.
