Bulletin - April 2018
April's edition of our Bulletin
Bulletin – April 2018
Digital assets in Wills
Have you thought about your digital assets when making your Will and Lasting Powers of Attorney?
Technology has transformed how we live, improved how we interact and communicate with each other, given greater convenience, a wealth of up-to-date knowledge and news and transformed how we shop. But what happens when you die or lose capacity? Have you given any thought to what happens to your digital life?
Most people know how they would like their physical assets to be dealt with and have written a Will so that their estate can be passed onto their loved ones and beneficiaries and appointed executors to administer their estate. Have you thought about your digital assets, what will happen to these on your death or if you lose capacity to manage your affairs?
Digital assets include any accounts that you open online, email accounts, social networking, bank accounts even your own websites. Although they may not all have a monetary value you do need to take some time to think about how you would like them to be dealt with when you die.
Some of these may be valuable such as bank accounts and Paypal accounts; indeed all online accounts. Your photos, family videos and music collections may have sentimental value. Your Facebook, Linked In and Twitter accounts may have social value. If you have your own website and domain name, these could lapse if fees become due and your executors can’t deal with them promptly.
You should therefore take steps to ensure that your executors will be aware of all of your online assets and more importantly that they will be able to access them. The first step is to keep a record of your digital assets, so they are clearly identified and available to your executors. If you do not leave instructions, your executors may not even know about these accounts. The next step is to think about how to leave your sign-in details and passwords. Have you thought about using a password manager that offers online, safe storage for your usernames and passwords? These details can then be made available to a nominated person on your death. Please ensure that any method you choose is secure, AND do not include these details in your Will as it becomes a public document once you have died!
Are your executors computer literate and able to manage these accounts, or do you wish to appoint separate executors to manage your digital assets? Be aware that not all of your online assets are yours to pass down to your beneficiaries; some accounts have licence agreements that allow you to access your purchases in your lifetime but end on your death. So, your executors’ legal authority to handle your digital property may be restricted. Some accounts can be closed or memorialised or you may be able to make an advance decision depending on the terms and conditions.
Have you made a Lasting Power of Attorney? Have you thought about granting access to digital assets in the LPA? This is particularly important for online bank accounts as otherwise anyone logging into your account on your behalf may be committing an offence under the Computer Misuse Act 1990.
If you would like us to review your Will or LPA or discuss this further please contact us and we will be pleased to help you.
We are pleased to confirm the dates for this year’s annual seminars which will be:
Wednesday, 26th September at the NLC, London and
Thursday, 27th September at Denbies Wine Estate, Dorking.
Please save one of the dates, and more information will follow. This year we will be holding a KMG panel discussion and a bigger Q&A session.
To ensure we accommodate as many questions as we can, we would ask you to submit to us before the event any questions you would like to put to the KMG team or our speaker, however, questions are very much welcome on the day! We will send you more information in early summer, but in the meantime, if you have any questions please contact me.
It’s all about trust
Trust is a rare commodity that is being abused in many ways and for all sorts of reasons.
We did not trust either side of the Brexit argument and a major part of this dilemma has been the way in which the European experiment has been misrepresented and misunderstood by us all for 40 years.
We increasingly worry about the money that we use as it is being abused by governments and central bankers who are creating more and more money out of nowhere to fund a welfare system we cannot afford. Ironically, we do not want to pay higher taxes, and yet still expect wonderful services; so do we even trust ourselves? We know that money-printing is in effect debt manufacturing, and we know that deep down the debt we are raising and creating will never ever be paid off.
We do not trust technology companies with our data; just look at the Facebook dilemma. By the same token, technology also means that we do not need to believe or trust in the political and/or administrative systems of global governments because power is increasingly at our fingertips to find the information we need and to trade in the world as we wish to without being individually and irresponsibly controlled by the state. But do we trust ourselves? We all choose to ignore some issues, it is part of human behaviour, and that is what makes predictions about the future impossible, and yet fascinating!
So, who do we trust? Trust is in our state of mind. It is built upon our experience. It is affected by the actions of people and institutions with whom we live and work each day, and is confirmed by the results we experience from those in whom we place our confidence.
If you are reading this article it is probably because you have placed your trust in KMG. Why?
- KMG does not over-promise and under-deliver
- KMG constantly keeps clients informed and educated in the ever-changing world in which we live
- KMG tries to predict and warn of future events which may affect financial affairs not just individually but in general across the whole of life
- KMG has been around for a long time, we intend to be around for a long time
- Not many companies can claim to be looking after four generations of the same family
- KMG doesn’t have a crystal ball and we don’t claim to be anything that we are not, but we can genuinely claim to have built a substantial account in the “MATTER OF TRUST”
- KMG clients rely upon us in a whole range of subliminal ways to help with a wider range of issues other than simply investing money.
At KMG, we minimise taxation where possible, we try to minimise volatility where possible, we never over-promise investment results and we err on the side of caution when considering future investment returns. Trust is a febrile matter; one that can be broken very easily and very quickly.
We recognise how important trust is to you. Our primary objective is to preserve that trust and continue to earn that trust by looking after you and the clients you refer to us in the absolute knowledge and trust that the referral will be dealt with in a trustworthy and honest way.
There is no price that you can place on the trust that you have given to us. The value of that trust is consequently priceless. Thank you.
How on earth should you invest today?
Firstly, things are rarely as bad as you think. We are taught, by the press and by our instinct, to latch on to headlines that sensational events are the norm and much more widespread and important than they usually are.
Think about what is moving markets today. It is the fear of trade war between the US and other parts of the world. There is an underlying fear of what might happen in the Middle East and between Russia, the US and the UK in particular and it is the uncertainty of what will happen when the process of quantitative easing goes into reverse; in other words when money is pulled out of the system and interest rates rise. Finally, regulation is catching up with these mega-tech companies of Facebook and Amazon.
I am not saying that at KMG we are ignoring such news, rather we are trying as hard as possible to think about what is behind the headline. How easy is it to get caught up in what is affecting us today and forget what it was that scared us yesterday? Very rarely do they materialise into something tangible.
Rather than thinking about all those wonderful negative topics that we discuss at dinner. Think about the most amazing progress that has been made over the recent past:
- poverty – the number people living in extreme poverty has halved over the past 20 years
- education – the average length of time in education has risen for both boys and girls across the World and literacy has increased from just 35% in 1960 to over 85% today
- health – nearly all children are vaccinated against one or more illnesses that caused untold misery and death in the past
- getting richer – the vast majority of people around the world now live in middle income countries, not the attention grabbing images of famine or war struck nations (where a surprisingly small amount of the world’s population actually live). They are not rich, and we would view their living standards as dramatically worse than our own, but they are not living hand to mouth, and are not starving. More importantly things are generally getting better.
Much of the above we have taken for granted in the West for more years than we would like to remember, but the important thing is that there are more people alive than ever, with more money and more education and who are likely to live for a longer time.
There is a greater requirement for services, for energy and the driving requirement for new ways and new technology to manage all of this whilst not running out of water and without boiling the world. None of this is new; in fact, it has been one of the few trends accurately forecasted decades ahead of time. There has been no real excuse for the mess the UK is in, the arrival of millions of baby-boomer retirees has not been a surprise. Watch the rates of birth and mortality, and you can see what happens.
So, what are we doing now at KMG? If we can look past the ‘now’ and tap into the undeniable trends of the future, then we can continue to generate significant profits in the years ahead.
We do not like holding more cash in the portfolio than is necessary, although there are times where we must. Equity remains our preferred investment as the best way to extract value in the future as interest rates rise (slowly) and we are looking to put the cash in the portfolio to good use.
We are looking at specific themes around demographics, including those countries where populations are more attractive and potentially dynamic. So, don’t be surprised to see mention of India and China surfacing again.
Finally, and overwhelmingly, we are able to take a long-term view and by doing so we can avoid the mistake of getting caught by the news of today and look for the opportunities of the future.
We continue to report on this subject from time to time as we feel that this will be crucial to developments in financial services in the future. Having come across this piece about Microsoft we thought we would share it with you. If you visit the following site:
you will read first hand the developments at Microsoft and the cartoon video further down the page is a useful explanation to Blockchains. We hope you enjoy!
Changes at 7IM
For those clients who hold their KMG investments with 7IM, we are delighted to confirm that we have negotiated a new deal with the platform reducing charges. Investments up to £1million will now attract a reduced charge of 0.25% and assets over £1 million will continue to be charged 0.15%.
In the past the platform has not always been cost effective for some of our clients and we now hope this change will allow those clients to also take advantage of this investment platform. 7IM has one of the largest investment horizons with a great range of fund opportunities which your adviser will be pleased to discuss with you at your next meeting!
We are delighted to have relaunched our website this month with a fresh new look.
Included in our site are useful links to platform websites where you can register to view your investments. We hope to continue to develop the site to a more interactive experience.
In the meantime, we hope you find the site interesting and easy to navigate, but as always we welcome your feedback and views!