Lockdown – an opportunity?
Lockdown – an opportunity?
The unprecedented last few months have provided a pause for many, provoking thoughts about what they really value in life.
At Creaseys, we work with clients to understand their ‘Bigger Picture’ – what makes them tick, what’s important to them and crucially where they want to get to – so we can support them on their journey to get there.
In conversations with clients during lockdown we have discovered more about what they have appreciated during this time and, for some, the changes they would like to make as we ease out of it.
Simple pleasures such as being able to eat together as a family, additional free time without the commute or opportunities to get outdoors and exercise more have prompted questions from clients about the changes they’d like to make in their lives.
Are there things you want to do? Would you – could you – work less? Do you have the information you need to make decisions? Are you ready to think about an exit strategy from the business? Are there gifts you’d like to make?
Here are just a few of the things we’ve been discussing with individuals and businesses:
This period of reflection has led to some of our clients considering how they can protect their families and provide for them in the long term. We have worked closely with them in assessing their objectives and considering the setting up of investment vehicles allowing wealth to accumulate for younger generations, whilst allowing the older generation to retain control for the time being.
Wills and gifts
More time at home and the pandemic’s health risks has prompted clients to review and consider updating their Wills; indeed for some getting one in place. We’ve been talking to clients about steps they might take to protect their family wealth from inheritance tax. Gifting can be an important part of this which can prompt questions regarding control of assets as well as when is an appropriate time? And how much? We support our clients to help them make informed decisions.
Our sister business Creaseys Wealth has been sharing lots of content about individual’s personal financial situations in recent weeks, and we wanted to share one of their latest pieces with you. When it comes to managing finances, we know that technical excellence is imperative, but have you ever thought about the emotional benefits of working with a trusted financial adviser? Here they highlight the importance of having a relationship with your adviser that covers facts and feelings. Find out more.
Tax payments reminder
Some of our clients will be taking advantage of the opportunity to delay the payment of their 31 July self-assessment payment on account to 31 January next year. This can be done without incurring interest or penalties.
For businesses and their owners:
Exit and succession planning
For many business owners, the day-to-day running of a business can often take precedence over thinking about the future. Once up and running they set their long-term goal to either sell the business or pass it on to the next generation and then work hard in the business to make this happen. However, the last few months has brought many clients plans back into focus as they have been forced to consider not only the short-term impact on their businesses, but also to take a step-back and review their long-term plan.
Clients are asking questions such as, ‘Is now a good time to sell?’, ‘How much is my business worth now?’, or ‘What do I need to do now to achieve a sale?’. For a few clients the experience over the last few months has lead them to want to accelerate their exit plans and re-evaluate what is next, and they want to know ‘Will the sales proceeds be enough to fund my retirement?’. We have worked alongside our clients to help them understand the answer to these questions; the solutions have not always been obvious. We have ensured our clients understand their options and what each means for them.
Due to the rapidly changing economic environment over the last few months, entrepreneurial clients have taken the opportunity to review their corporate structures to assess whether certain assets should be protected from volatile trading businesses. For some this has resulted in groups being restructured and assets such as property and intellectual property being transferred to holding companies so they are separated from the underlying trading businesses.
Enhanced management reporting
More than ever, clients are investing greater effort into preparing more detailed and more timely management information. Circumstances have meant business-owners wanting to review more detailed management information on a weekly, rather than monthly (or even quarterly) basis, to be able to make crucial decisions more swiftly. They have wanted to make greater use of their accounting software to identify profitable and weaker areas of the business. We have been supporting clients to optimise use of the budgeting tools in their accounting packages, such as Xero, Sage and QuickBooks, allowing them to track actual performance against their COVID-19-revised forecasts.
Cash flow monitoring
When lockdown began, our message to clients was ‘cash is king’ and that the preservation of liquidity during uncertain times had to be a priority for business-owners. We‘ve seen clients of all sizes making huge changes to how they monitor their cash flow requirements; those with advanced cash flow management systems in place before COVID-19 have adapted their reporting to stress test a variety of scenarios, from the very pessimistic to the moderately optimistic, allowing them to make business-critical decisions at the earliest opportunity; and those who previously had little appetite for detailed cash flow forecasting models have very quickly needed to build these from the ground up. With the Job Retention Scheme soon coming to an end, cash flow monitoring and forecasting have been – and will continue to be – imperative for our clients.
We can provide support and advice to enable you to make an informed decision about your next steps and are experienced in putting a plan together to help you achieve your dreams.
Get in touch with our team on 01892 546546 to find out how we can help you.