The race to the top of the money tree

The race to the top of the money tree

In just a week the longest general election campaign in living memory will be over.

After the debates and arguments, party leaders will finally face the verdict of the general public they have spent the past few months avoiding while preaching at stage-managed events.

For those of us interested in personal finances, both professionally and personally, this promises to be a pivotal election.

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I cannot recall an election in which so many promises have been made, but with such reluctance to specify from where the money will come.

We have the prospect of the Scottish National Party, whose leader is not standing for the UK parliament, dictating policy south of the border.

Incidentally, why would Nicola Sturgeon stand when as first minister of Scotland she is entitled to a £144,687 salary – that is £2,000 a year more than the UK prime minister’s salary? Currently she draws £135,605 due to a voluntary pay freeze.

What now seems inevitable is that post-election horse trading will render manifesto promises meaningless.

Last time the Lib Dems pulled the Tories towards the centre. This time a coalition that will pull Labour even further to the left is looking increasingly likely.

“An end to austerity,” we hear the politicians shout. “Let us spend today and let our children pay the bills and interest,” is what this really means.

For financial advisers and investors this is not a comfortable time. There have been dire warnings of what political uncertainty could do to the stock market and the currency markets.

But global events tend to have far more effect on stock markets than the parochial decisions of our prime ministers.

We have had a pretty decent five years, personal finance-wise. Higher income tax allowances and reforms to pensions and Isas have all been welcome.

All right, not everything in the garden has been rosy, but someone has to pay the bills.

We now have the prospect of all that progress being sent down the plughole by a bunch of politicians who think they have the right to spend the money we earn.

Whoever is elected we are promised more fiddling with pensions tax relief when what we need now is a period of stability.

There will be more complex decisions facing investors who will be prevented from using pensions by the lower £1m lifetime allowance.

There will be further clampdowns on tax avoidance, more changes to reliefs, and no doubt someone will find a reason to fiddle with Isas.

All in all, I suspect we will soon be living through interesting times when we could all do with a period of mundane dullness.


Cheeky charges

Did you catch the Direct Line-commissioned survey listing the most-loathed fees and charges?

Not surprisingly unreasonable parking charges topped the list. My personal hate is the unavoidable surcharges on concert and cinema tickets, which came in at number three.