Government must encourage financial resilience: Nicol

Government must encourage financial resilience: Nicol

The government must help people plan for their futures by delivering policies that support savings and investment, and encourage self-reliance, David Nicol has said.

The chief executive of Brewin Dolphin claimed there was an urgent need for policies to incentivise people to focus on their future.

Mr Nicol added: “The obstacles that currently stand – whether inheritance or capital gains tax, imbalanced savings incentives or pension growth limits – must be removed to promote a savings culture that is badly needed.”

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He said the wealth manager has a seven-point plan it hoped would help breed a savings culture and financial resilience.

Proposals included more financial education in schools, encouraging savings for children, increasing AE contributions to 10 per cent by 2020, and a 30-day drawdown cooling-off period.

Long-term investment should also be encouraged by reforming CGT and IHT rules.

In March, Policy Exchange published a 61-page manifesto urging the next government to overhaul the saving sector to make saving easier, more flexible and accessible.

Steve Hughes, head of economic and social policy at the Westminster-based think tank, said recent initiatives aimed at driving a savings culture needed to go further to ensure it was open to all.

Last December Which? found that 49 per cent of people were worried about their level of savings. The consumer group called on the government to put in place a national savings strategy, developed with the financial services industry, employers and consumer groups.

According to OECD data for 2012, the UK has one of the lowest savings ratios among the leading developed nations. France tops the table with 15.8 per cent and the UK sits in 13th place with 5.4 per cent, 0.2 per cent more than the Slovak Republic.

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Floyd Fombo, financial planner at Bristol-based Rathmore Financial, said: “The fact there has been no savings culture has been a big problem. The pension reforms were a starting point but people had access to capital who were financially uneducated.

“You can start in schools but the question is, how to educate people today? The government has a big role to play but also families should be responsible.”