Certainly, the past three weeks have been some of the most exciting and troubling times I have experienced as a consumer money journalist.
On 23 June, the day of the EU referendum vote, I wrote a personal finance column for The Mail on Sunday stating that on the back of a ‘remain’ win, it was crucial for the government to get back on track and carry on with its day job of ensuring the economy remained in growth mode.
Of course, the next day, at 5.30am, when my radio clock rang out like a shrill gull on acid and Radio 4 alerted me to the fact that the Brexiteers had won against all the odds, my column was redundant (I have kept a copy for posterity’s sake).
Within an hour of scurrying out of bed and getting on a Boris Bike to hurry to work, I was told by the editor that I had a 16-page special to produce on how Brexit would impact our finances. Hairy stuff; but by Saturday afternoon, the job was completed – albeit with little sleep and enough stress to induce hair loss, and stomach cramps which have yet to go away.
Within an hour of scurrying out of bed, I was told by the editor that I had a 16-page special to produce on how Brexit would impact our finances.There is no doubt that the fallout from – and response to – the Brexit vote will have a major impact on the UK economy in the months and years ahead.
The political landscape is shifting all the time, with tectonic plates regularly colliding against each other while the financial markets are in a volatile mood.
Sterling remains subdued, gilt yields are tight, and the UK stock market resembles a yo-yo. Worryingly, some of the country’s biggest property funds have pulled up the drawbridge, suspending withdrawals and stoking fears of a commercial property crash.
Although the anointment of Theresa May as Prime Minister may bring a semblance of calm, I doubt it. While uncertainty remains, we are in for a rocky ride.
Against a frothy political, financial and economic backdrop, I have been able to send out some simple messages to readers in recent weeks and days.
1. Lock down your mortgage payments with a fixed-rate loan (preferably a five-year one).
2. Ensure your cash savings are earning a half decent rate of interest.
3. Utilise your tax-friendly savings allowances and tax reliefs (Isas, pensions and personal savings allowance).
4. Be wary of locking into a rock-bottom pension annuity rate, ensuring you shop around for an annuity that suits your circumstances and takes into account any health issues.
5. Be careful not to denude your drawdown pension pot with punishing withdrawals.
6. Keep investing through thick and thin and through monumental stock market gyrations.
7. Ensure your investment portfolio is sufficiently diversified.
8. Shop around for the best currency deal – and certainly do not wait until you get to the airport before buying your euros.
I think these bits of advice (personal finance nuggets, I call them) have been useful to many readers, especially those who, sadly, do not have access to quality independent financial advice for whatever reason.
But beyond these, I am not sure what more I can say about money post-Brexit vote. Certainly, I am not in the game of second-guessing where stock markets will go from here. I would much prefer to encourage people to think long-term rather than wonder whether it is currently better to invest in FTSE 100 shares or FTSE 250 stocks.
In among the turmoil, what I have been reassured by is the phlegmatic attitude of our country’s adviser community.
In the wake of the Brexit vote, I sent an email to a number of advisers asking them for their response to such uncertain times. To a man and a woman, they were calmness personified: “Post-Brexit, we sent round a discussion document reassuring clients that their portfolios are robust enough to suffer any fall out from Brexit,” said Mark Rogers, managing director of Birmingham-based financial planner Clay Rogers & Partners.
He added: “We are where we are, and our portfolios and the investment recommendations agreed with clients are for the longer term. All our clients have a cash flow plan, and we haven’t adjusted these plans as a result of Brexit. Things are pretty much normal as we see it.”
Scott Gallacher, a chartered financial planner with Leicester-based Rowley Turton, said he had yet to take a call from a client panicking about the implications for their finances. He added: “We wrote to clients asking them to pick up the phone and call us if they were concerned.
“We also reminded them that despite markets falling in the second half of 2008, the average investor who sat tight and rode out the storms would be approximately 30 per cent better off today than those people who panicked and switched into cash.”
Similar sentiments were made by Neil Rossiter, of Taunton-based Blackdown Financial – “An overwhelming majority of clients were calm, and understood the need for patience” – and Claire Walsh, of Brighton-based adviser Aspect 8 – “I reminded clients about our long-term investment philosophy, and many thanked me for the reassurance.”
All sensible comments. There is only one way forward. Think long-term – and sleep peacefully at night.
Jeff Prestridge is personal finance editor of the Mail on Sunday
