Peter Robinson is a technical trainer for heavy duty vehicle drivers. His main concern is his inheritance tax liability for the family businesses. He has also been considering buying a house and wants help to prioritise his goals.
We asked a team of financial advisers for guidance: Dane Halling, from Arcturus Investments; Keith Churchouse from Churchouse Financial Planning; and Darren Baker from QED Wealth Management.
Peter Robinson, 26
Salary: Around 30,000
Monthly outgoings: 2,075
Total savings: 8,300
Pension contributions: 800pa
Total debt: 11,000 student loan
Debts & Savings
Darren Baker says: "Peter has been working for just two years now, earning good money and has few cares," he adds. "Peter wants to have a deposit of 25-35,000 available to him to buy a house in two to four years His current savings (all cash), are roughly 1,000 less than the balance left on his student loan. Assuming he wishes to repay this before he takes on a mortgage he will have to save somewhere between 560 and 1,480 a month to achieve his deposit goal."
However, Baker acknowledges that Peter's income is erratic and advises that any savings plan should be flexible.
He suggests Peter concentrates on his short-term goal of saving for a house deposit. But adds that Peter should repay his student debts before taking on a mortgage.
Keith Churchouse adds: "Peter has 7,500 in his current account. For tax-efficient and secure savings, he could also use part of this in Premium Bonds to gain tax free winnings whilst maintaining the capital for three years' time. "
Longer term, Peter could consider diversifying into different investment areas. Dane Halling says: "As he will be the recipient of a significant property portfolio in the long term, a steady investment programme into equities is a logical step."
"To achieve his aim of receiving an income of approximately 18,000 in present-day income, Peter would need a pension fund in excess of around 360,000 as capital," Churchouse says. "He should consider increasing his contribution."
"It is apparent that Peter's family have substantial assets," Baker comments. "He will inherit 50 per cent of this. His family assets include a farm which could benefit from agricultural property relief, exempting some or all of their value from IHT. "Peter should have a will. Although he may not appear to have substantial assets in his own right, he is a partner in the family firm and it is important that the future of this asset is clear."
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