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Is your income suffering from record-low interest rates ?
Wealth management specialist Emma Stapley explores your options .
Income is important . It ’ s an obvious statement . The difficulty is that , in an uncertain world , investment income is hard to find right now . Investors looking for income have faced an increasing challenge ever since the financial crisis broke in 2008 . Prudence and vigilance became the order of the day as financial institutions across the globe took extreme measures to protect themselves from global meltdown .
Central Governments across the world also reacted strongly , forcing interest rates to record lows . Nine years on and interest rates in the UK remain almost non-existent . The result is real losses for savers in bank and building society deposits which fail to match inflation .
Investors wanting to secure a better level of income have realised that they must look beyond traditional cash deposits .
History shows that investing in equities , or shares , has provided investors with a better chance of outpacing inflation over the long term versus other asset classes , particularly if the shares are able to increase the dividend payments year after year . Positively , there are indications that the recent trend of increasing dividend payments could be sustainable .
With dividend payouts on the turn , the outlook for equity income funds could also be on the up . Equity income funds have a strong track record for delivering attractive , sustainable income and steady returns over the long term . But it is worth remembering that not all equity income funds are the same . Some are better for income , while others provide better prospects for total return investors through the reinvestment of income . St . James ’ s Place offers a range of equity income funds managed by investment managers with complementary styles .
Corporate bond funds which are , by their nature income producers , remain popular particularly with cautious investors . At St . James ’ s Place we firmly subscribe to the view that a diversified fixed interest strategy with exposure to investment grade , sub-investment grade and senior secured debt will help position your portfolio to benefit from growth across the credit spectrum .
Commercial property felt the full effects of the credit crunch and the fall in property values left many investors nursing significant losses . But again , history suggests that commercial property has a place in a portfolio for income investors . Its long-term track record is strong and , importantly , it offers returns that are lowly correlated to other asset classes . Investors should however note that investing in real asset classes ( equities , corporate bonds and commercial property ) does not provide the security of capital which is characteristic of a deposit account with a bank or building society .
Those investing for income need to remember that no one asset class is the panacea . With
As a Chartered Partner of St . James ’ s Place Wealth Management I have over 20 years ’ experience in the wealth management industry . I strive to provide the highest standard of personal service and quality advice to all of my clients .
Putting my clients firmly at the heart of everything I do enables me to run a genuinely client-focused business . In my experience , no two clients are the same and I therefore ensure that I understand your personal or business objectives and deliver solutions that are right for you .
Call 07795 951454 for more information or your complimentary guide to wealth management .
uncertainty around interest rates , a welldiversified , well-managed portfolio which blends a range of asset classes remains the most suitable strategy for investors to satisfy their longer-term income needs .
At St . James ’ s Place we believe that our ability to tailor solutions to an individual ’ s needs and attitude to risk means your income investments are in good hands .
EMMA STAPLEY
Partner
Mob : 07795 951454 Email : emma . stapley @ sjpp . co . uk
The value of an investment with St . James ’ s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up . You may get back less than you invested .
The Partner represents only St . James ’ s Place Wealth Management plc ( which is authorised and regulated by the Financial Conduct Authority ) for the purpose of advising solely on the Group ’ s wealth management products and services , more details of which are set out on the Group ’ s website www . sjp . co . uk / products . The title ‘ Partner ’ is the marketing term used to describe St . James ’ s Place representatives . Emma Stapley is a trading style of EJS Financial Services Ltd . www . rugbyclubmag . com 23 H2SJP26157 06 / 17