Seven Miles Financial Planning (SMFP) provides financial planning and education for individuals and small businesses to help them achieve their lifetime dreams and goals.
This month, our ‘Interview with...’ is with Ian Miles.
Tell us about your business
Seven Miles Financial Planning (SMFP) was set up at an infamous time just over 2 years ago as the country was about to move into lockdown. Despite this significant change in our environment the purpose of the business is no different: to provide financial planning and education for individuals and small businesses to help in achieving their lifetime dreams and goals. In addition to this commercial help, I am involved with providing financial education in schools and the workplace.
What is it about financial planning that means so much to you?
I originally qualified as a chartered accountant and so have always been involved with numbers. But the financial environment is complex and combined with a natural sense of curiosity my original roles in the commercial corporate world became an ideal platform to explain the numbers to non-financial colleagues and managers both in terms of what the numbers represent and even more importantly what future actions mean for a business or individual.
Quantifying those actions through a financial planning process gives insight about affordability as well as allowing decision makers to see and understand the impact of their operational decisions or more prosaically what is needed to fund an education, save for a house or plan for your retirement to name just a few examples.
You renamed your company to Seven Miles Financial Planning. The seven is a significant part of your name, can you explain its meaning.
As I hinted in my last response every action or decision has a financial repercussion. Our lives and careers are punctuated by significant lifetime milestones which all merit a financial conversation and some financial planning. Financial planning is not carried out for its own sake but to support the optimal achievement and management of those milestones and when I state them (all seven) it becomes clear as to why:
i) Growing Up
ii) Further Education and requalifying
iii) Entering the workplace
iv) Relationships (both beginning and ending)
v) Parenthood and caring
vi) Later Life Planning, including retirement, and finally by no means least
vii) Ill health, infirmity and death
When do you think it is the right time to start planning your finances?
I am often accused of being flippant and this response may be seen that way, but this is the first of my seven milestones. While it is often interpreted as the stage when a young family can start to help their siblings, it is also very much the time when financial literacy and good savings habits can be instilled in youngsters; not to forget the basic management of money to ensure that money is looked upon with seriousness but not foreboding or fear.
As things stand, we are miles away from these laudable aims but just think what young men and women are confronted with as soon as they leave the school gates, or even more ominously what might be infiltrating their phones. (Things that I never had to encounter with my quill and ink at school!)
Is it too late for someone in their 40’s or 50’s to plan for retirement?
It is never too late to initiate this process but there has been concern over the years that individuals and businesses need to be encouraged to save for retirement. If you are employed the government has introduced the process of auto-enrolment but this doesn’t cover the self-employed.
The tax system treats very favourably contributions to pension schemes and there is now much more flexibility about what can be done with pension funds. However, there remains an advice gap with many individuals thinking it is too expensive to get financial advice while the rules around pensions remain complex.
My advice is to save as much as you can afford, do it on a regular monthly basis but do it at the same time as you receive your income into a low-cost platform
What should people do if they have pensions in multiple companies?
If there are no special guarantees surrounding the pensions, it is a matter of good housekeeping to consolidate your pensions. However, this area is ripe for scamming with notorious examples of individuals in certain company schemes giving up very generous protected rights. This means that any pension transfer (with a value over £30k) cannot be done without financial advice.
Is having your eggs in one basket a good or bad thing? What if you move your pensions to one company which subsequently goes under?
The answer to the first part of your question is that you should not hold all your eggs in one basket.
I hope I can widen your question out to describe the broad approach to investment advice that I and my financial network St. James’s Place follow. In summary the following key principles apply:
i) Ensure that you have sufficient cash easily available to meet your short-term needs, including allowance for emergencies
ii) Take a clear view of the timeframe for which you are able to invest your money
iii) Don’t overlook the impact that inflation can have on the spending power of your money
iv) Spread your investments across a number of different asset classes and investment managers, to reduce the danger of all your investments falling in value at the same time.
The question about what happens to your pension if the provider goes under is unfortunately complex but in essence the potential support for members of a failed scheme is determined by the type of pension scheme. Up until the end of the last century, most pension schemes were so called defined benefit plans with risks of the scheme firmly with the company. (It is a type of pension that pays you a retirement income based upon your salary and how long you’ve worked for your employer. Defined benefit pensions include “final salary” and “career average” pension schemes). Since the turn of the century companies have aimed to pass this risk on and the majority of schemes established since then have been defined contribution schemes with defined benefit schemes closed to new members and benefits reduced. (Defined contribution schemes are also known as a money-purchase scheme and includes workplace and personal pensions. With this type of pension, you build up a pension pot to pay you a retirement income. It’s based on how much you and/or your employer contribute and how much this grows).
Hence, if the scheme goes under and it is a defined benefit plan it is protected by a government agency called The Pension Protection Fund (PPF). The PPF might step in and pay members retirement income as compensation if employers become insolvent and the scheme doesn’t have enough funds to pay their benefits. The compensation might not be the same as if the employer hadn’t gone bust. The level of protection depends on whether you had passed your normal pension age when your employer became insolvent. The rules are complex, but the PPF does act as an effective safety net.
Contrast this with a defined contribution scheme. This type of scheme isn’t covered by the Pension Protection Fund. But there several layers that help to keep your money as safe as possible.
Firstly, all registered pension schemes in the UK will be regulated by either the Financial Conduct Authority (FCA) or The Pensions Regulator (TPR). These are both independent bodies which aim to protect members, reducing the possibility of things going wrong. These organisations set out the rules under which pension schemes must operate and how they must manage the investments of pension plans.
To protect investors’ money, there are strict rules that govern the financial strength of companies, as well as the systems and controls they must have in place to protect your investments. These organisations have many powers, including the ability to inspect the operations and risk controls your pension providers have in place. Providers have to report regularly on their financial strength.
Are there any big changes on the horizon that you know about that the general public may not be aware of?
Before even talking about regulation the biggest influence on the public in the next year or so will be inflation and cost of living rises on their savings and household budgets which for many families and businesses will not have been something they have ever experienced. There are strategies to mitigate this and many organisations and agencies including financial advisers to help.
With respect to regulation the march of the use of crypto is still an unregulated activity but the size of the market is suggestive that it really needs to come under the control of the regulators in order to offer better consumer protection so watch this space.
More prosaically small businesses currently have only a passing contact with HMRC filing annual accounts and sending these to the tax office. From 2024 the self-employed (above a certain revenue threshold) will need to complete FIVE returns each year. The cynics amongst us think this is another step towards quarterly tax payments.
How long have you been a Partner of St. James’s Place Wealth Management?
Officially I was approved as a regulated financial adviser in Dec 2019, so just over 2 years ago.
The 6-7 months prior to that was spent at St. James’s Place Academy that provides the soft skills to become an adviser and the time and resource to pass the six exams needed to achieve regulated status.
You are in effect your own business. What lessons have you learned as a small business owner?
A number of things:
i) Have confidence that you know more than you realise!
And if I do get a question that I don’t know the answer, the power of the organisation behind me will wriggle it out.
ii) Don’t be a loner!
I am comfortable with my own company and am resourceful, but support is needed. This not only helps your own wellbeing and work/life balance but also ensures that you keep focused on your main business objectives. Indeed, I have even outsourced items within my comfort zone such as company administration and accounting.
iii) There are no quick wins but consistent repetition of sound practices
Your networking, posting social media messages, following up on contacts are all practices that will yield results but not immediately.
If there is anything that you would do differently, what would that be?
Get a routine established earlier and follow up more effectively with contacts.
How do you promote your business and services?
Networking and social media, as well as old school campaign distribution such as Christmas cards and Tax Year-End promotion.
What are your ambitions for the next 5 years?
My mission is to help individuals and businesses to achieve their dreams and goals through a professional and bespoke approach to financial planning through a level of uncompromised integrity. To fulfil this my goals are to:
i) Grow my assets under management to £5m
ii) Become a recognised tax and pensions specialist
If you would like to get in touch with Ian, or find out more about Seven Miles Financial Planning, visit https://partnership.sjp.co.uk/partner/ianmiles or go to his LinkedIn profile.
Seven Miles Financial Planning is an Appointed Representative of and represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products The “St. James’s Place Partnership” and the titles “Partner” and “Partner Practice” are marketing terms used to describe St. James’s Place representatives.
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