Now that Theresa May has formerly triggered Article 50, are we going to make a dog’s breakfast of Brexit or can we look forward to dining at the Ritz?
Despite all of its implications for financial planning, I have steered clear of commenting on Brexit for the past six months. My personal view remains that the Referendum result was the best possible outcome for the UK, but I believe it is vitally important we recognise that the next few years may bring significant challenges for financial markets. To protect clients, it is going to be essential that advisers stay alert to the risks, as well as the benefits of leaving the European Union.
The past 40 years have seen the tentacles of the EU become embedded in every aspect of our lives, with the result that, as we start the exit process, nothing can be taken for granted. Wherever one looks there is potential uncertainty or concern and, with increased uncertainty, comes increased risks as well as – hopefully – opportunities. The challenge will be cutting through the headlines and chatter over the next two years to provide the comfort and advice your clients will need.
Add into the mix uncertainties across the world from Mr Trump, to Russia, China and North Korea, along with the powder keg and human tragedy of the Middle East, and you can begin to appreciate the importance and value of financial advice to clients and indeed the wider public.
The good news is that we start the exit process in good shape economically, as the Armageddon forecast by the Remainers has failed to materialise. The lower pound is helping exports and, while it is too early to say that we are entering every Chancellor’s dream: an export-led boom, the signs are encouraging.
My conclusion is that trying to pretend to clients that you know how to second-guess these markets would be a flawed strategy. Far better that you highlight the massive uncertainties and opt for expertly managed, balanced portfolios that reflect the performance of markets and assets across the world.
‘Steady as she goes’ financial planning may not be as sexy as being a fund-picker, but it will ensure that the outcome of the Brexit negotiations does not become a dog’s breakfast for you or your clients, and fine dining will remain an option.
Ken Davy is chairman of SimplyBiz Group