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Viewing posts categorised under: Spain

Financial open forum, Mallorca

By Susan Worthington
This article is published on: 17th April 2024


A big thank you to all our partners and to those that attended the recent open forum in the Hotel Linder Gold, Bendinat, Mallorca.

The Spectrum Group – Susan Worthington, Jonathan Goodman and Patricia Nadal

Prudential International – Edny van den Broek

Currencies Direct – Aldine Tomlinson, Alfonso Rey & Charlotte Park

Our open forum was the perfect format, that produced plenty of attendee interaction which lots of interesting and thought provoking questions from the audience.

We look forward to our next open forum during the coming months focusing on the financial life of an expat living in Spain.

If you would like to be notified about our next event, please contact me at

What does a stockmarket fall of 36% mean?

By Barry Davys
This article is published on: 11th April 2024


It means your savings need to be organised before it happens

On 16th October 1987, the stock market in the UK fell 14%. By mid-November it was down 36%. It is for this reason you should keep reading.

The share price falls were across the board and good companies fell with the less successful. It was an arbitrary general fall in the FTSE 100 index. It seemed like a very risky time to be investing.

One of these falling shares was M & S. Yet to me it was ridiculous that M & S had been devalued by 36% when the business was in good shape and with prospects for ongoing growth.

I saw an opportunity to invest in the FTSE 100 index as I felt sure the better companies would be re-valued to reflect their sales and prospects. I knew that this was an opportunity to invest in my future, (not to try to make a quick buck).

Some of my clients also put part of their savings in the FTSE 100 index. Many did not. By August 1989 the index had recovered all of its lost ground. By 17th November 1997, it had gone up by 100% and is now 378% higher than it was in October 1987.

“Investing is the intersection of economics and psychology”
Seth Klarman – portfolio manager and billionaire

This is what I learned from those people who did not invest and which I now use to help people look after their savings. I now understand why those other people did not invest. The reason they didn’t is that I had not discussed, in detail, on a one to one basis, the following –

  • Their Attitude to Risk
  • The timeframe of their investments
  • Their capacity for loss

I arguably let those people down as their savings did less well than the people who did invest.

Having learned a lesson from the experience my clients now benefit from this insight.

It is important not to take too much risk, which I understand. But it is also important to take at least some risk, if your circumstances allow it.

It is important to avoid taking no risks. Indeed, I often hear people say “I want to be Cautious” or “It needs to be safe” and they have left money in the bank earning very little and certainly not keeping up with inflation.

If you think putting money in the bank is low risk, you could be right.

However, taking no risk/low risk can be the biggest risk of all and in the worst case an absolute certainty that your money will not keep up with inflation in the long term and you might not enjoy the retirement you had planned.

The risk of not keeping up with inflation, with not building up your savings, is you end up with a pot too small to provide a sustainable income in retirement. But with the right advice and the correct level of risk for you and your circumstances your sustainable income in retirement is much more likely.

What does a stockmarket fall of 36% mean?

Here are the things I consider when helping you judge the balance of risk versus the growth of your savings. A simple online questionnaire allows you to answer questionnaires to give you a suggested risk profile.

However, we do not leave it entirely to a computer to decide your future. I then discuss the suggested profile, answer your questions, double-check the suggested profile with you, and make any recommendations for improvement based on my 36 years of experience. A good blend of AI (artificial intelligence) and EI (experience intelligence).

What does this mean in practice and why trust me? Here is the outcome that clients get from the correct risk profile:

  • Bank accounts – needed to manage day-by-day spending and, separately, for an emergency fund for those unexpected bills
  • Always manage the tax aspect of your savings
  • Balancing flexibility with longer-term savings
  • Separate savings pot for different purposes. Why? If you wish to assist children with buying their house(s) and also want to manage your savings to provide an income in retirement, these aims are different and can therefore benefit from different risk approaches. Helping the children is a one-off event (per child) and is likely to come before your need for retirement income. The need for income in retirement can span 30 or 40 years, from when you stop work to when you pass away
  • In each saving pot, we make sure you have a globally diversified portfolio set of assets
  • Sometimes premium bonds are used for an emergency fund
  • Update your risk profile annually because your circumstances and requirements may change. If so, this may suggest an update to your savings pots which can keep you on track

Here’s why you should trust yourself. Inflation will go up and down but the world’s demographic is changing. Fewer workers mean higher wages and lower state pensions. These things point to higher inflation in the future. Getting the risk balance right on your savings is not a “nice to do”, it is essential. You need to trust that, with the right support, you can improve the likelihood of healthy savings.

Do any of the following apply to your situation ?

Do any of the following apply to your situation ?

    • Have too much money in bank accounts
    • Have recently received an inheritance
    • Are selling a business or have share options about to vest
    • Have losses on your current portfolio
    • Do not review your risk profile annually

If yes, arrange a call with me using my online system to book a time that is convenient for you.

It is an opportunity to get a better outcome from your savings, provide for your family, and help give yourself a sustainable income in retirement. Undoubtedly, you will be more relaxed too knowing that you have the right risk profile for your savings and that it is updated annually.

Top financial tips in Spain – March 2024

By Chris Burke
This article is published on: 28th March 2024


Spring is well underway and it won’t be long before the wonderful feeling of summer is upon us – I personally can’t wait!

Part of my role is to make sure you are financially/economically smart and keep you up to date with ways to reduce taxes, increase wealth and anything else I feel an expatriate living in Spain should know. This month we focus on the following topics:

  • British Passports – additional months rule!
  • Inheritance & Wills – important tax tips
  • What were the best investments of 2023

British Passports – additional months rule reminder!

If you are planning to travel to an EU country (except Ireland), or Switzerland, Norway, Iceland, Liechtenstein, Andorra, Monaco, San Marino or Vatican City, you must follow the Schengen area passport requirements.

Your passport must be:

  • issued less than 10 years before the date you enter the country (check the ‘date of issue’)
  • valid for at least 3 months after the day you plan to leave (check the ‘expiry date’)

Check your passport meets these requirements before you travel. If your passport was issued before 1 October 2018, ´´extra months´´ may have been added to its expiry date.

Surely this is obvious Chris you say? Well, since Brexit I am afraid not. Many people have passports which unknowingly have more than the 10 years validity on them and thus they travel to Spain thinking ‘great, my passport expires in October this year, more than 3 months after I arrive back in the UK from my trip to Spain’. However, the problem is Spain ‘doesn’t accept’ the extra 6 months that were added to the length of this passport.

I mention this because someone on my flight only recently was stopped from leaving the UK due to this. There are no alerts or checks from airlines even with online check-in until you get to the departure gate, a VERY painful way to find out. This applies to Spanish residents also!

Check your passport……. if it has the additional months, make sure you renew it before it’s not valid in Europe. New UK adult passports are now only valid for 10 years.

Inheritance & Wills – important tax tips
One of the FIRST things I tell anyone I meet professionally (whether they ask or not) is that the MOST important person to get on your side in Spain is a good tax adviser/accountant, particularly in respect of inheritance planning, and here is the reason why.

Depending on the relationship to the deceased, the value of the inheritor’s current assets, and the amount they receive, there could be a significant amount of tax to pay in Spain. Just by being organised in many circumstances this can be avoided.

Two case scenarios:

  • Someone retired dies who has a partner but they aren’t living together/aren’t officially a couple for administrative purposes or married
  • Someone dies and leaves money to grandchildren/nieces/nephews

In these scenarios and depending on where they live in Spain, tax could be payable at a rate of up to 72%……………however, this could be avoided by various methods including using gift tax at 5-9% prior to death or changing some administration before the person passes on from this world.

PLEASE make sure you are organised from an inheritance tax perspective if you think this could have an effect on you. Knowing what the potential tax could be will enable you to make important decisions or plan to avoid this.

What were the best investments

What were the best investments of 2023?

Hindsight is a wonderful thing.

However its always important to review and understand what has happened, why, and then decide if you need to change your approach towards most strategies in life, including investing.

Amongst many options, thematic investing has become more and more popular over recent years. To explain this approach simply, you are focusing on a trend/area that you believe will give you higher potential growth on your monies than in a more general investment. For example if you believe that Cyber Security is going to be an area that more people will spend money on in the near future and therefore a good area to invest in, you could target investments that focus solely or predominantly on this specific topic. Because you are being more focused and targeted, this attracts higher risk because your money is invested solely in that area. However, if you are correct then the returns/rewards are generally greater because you have channeled your money into that specific area rather than taking a general approach.

In 2023 it is clear that when you review which investment funds worked well, two key areas stand out more than most (I do not take cryptocurrency into consideration because many investment companies will not consider this, due to still being viewed as an unknown entity, and it being largely unregulated).

Strong performers in 2023 were:

  • Technology
  • US stock markets

However, it’s important to note that the year before this these were both two of the worst performing…….so how do you know what investment funds to pick, how long to hold them and when to make any changes?

Well, by education……by constantly being informed on a range of factors related to these areas, which could include the following:

  • Political
  • Environmental
  • Laws/legislation
  • Economic

Alongside this, considering your investment timelines, your goals and your appetite for risk/reward, then you can start to put together a strategy that with regular reviews and ongoing advice, with someone you trust, will give the best chance of success to achieve your savings and investment goals moving forward.

Click here to read independent reviews on Chris and his advice.

If you would like any more information regarding any of the above, or to talk through your situation initially and receive expert, factual based advice, don’t hesitate to get in touch with me.

Exciting times ahead

By Jeremy Ferguson
This article is published on: 26th March 2024


For those of you who are retirees, you will have lived through an incredible age of change and prosperity. You will remember the days of stopping the car and going to a phone box to make a call, possibly dictating a letter for a colleague to type for you, waiting for the post each morning to see if your recent job interview had been successful. Cars with no seat belts, and only the well-off flying around the world for holidays etc. On and on I could go, but you get my point, I hope.

Most of us would have started to write emails in the mid 90’s, and since then the advances in the use of the internet have increased exponentially. Mobile phones now are quite simply the most amazing multi-media tools, with what seems like the whole world obsessed with them. Maybe they aren’t a good thing for society, only time will tell.

But what I do know is the fact that you can use them to navigate anywhere, watch TV, read the newspaper, write emails, pay for your car parking online, translate between languages etc. All of this just never ceases to amaze me. Could you imagine telling someone a decade ago, this is where we would end up with mobile phones? Overall, this technology at our fingertips is incredibly useful and has changed the way we live.

The next decade is going to see an ever-increasing transformation in the use of technology, not only in our daily lives, but also in business and commerce. I am sure you have all heard of the Artificial Intelligence (AI) race that is underway at the moment.

L'intelligence artificielle (IA)

AI technology has recently been on trial in a Scottish hospital, analysing mammogram data, and managed to spot cancer in a number of patients which had been missed (due to its tiny nature) by the consultants. This is a perfect example of how this technology can be used to improve our lives.

There are four main areas of ongoing technological advance that may be worth observing over the coming years. Companies operating in these sectors offer huge growth potential for their shareholders.

There are AI companies, such as Microsoft, Amazon and Canon; and those specialising in financial technology (Fintech), Sage being prominent in this market, as well as Ricoh; there are robotics specialists, IBM and Adobe for example; and finally, the one we are all bored of hearing about, energy storage – many of the companies in this market are new, so there are few familiar names in there, but SAP is one name some of us may recognise.

The advances we are seeing in these areas are quite incredible, and if you think about it, the technology itself helps to further increase the speed of the new developments. Businesses who embrace these technologies to maximise their efficiency will all benefit from these advances. The knock-on effect will be far reaching and ever present in everyday life.

Retiring to Spain

My clients are retirees here on the Costa Del Sol, now living off pensions and investments they have accrued over the years, and one of my responsibilities is making sure they are getting the most from those investments. With the world changing so quickly, it is essential we pay attention to the management of those funds, in particular to ensure that whoever is making the investment decisions is forward looking in their approach, and importantly understands the new world evolving around us.

Please feel free to email me if you would like to discuss your existing investments and pension funds, to see whether we can help make them work as hard for you in retirement as you did in your working life to accrue them.

L’intelligence artificielle (IA)

By Cedric Privat
This article is published on: 16th March 2024


Opportunité ou menace?
L’arrivée récente d’applications dites “génératives” comme ChatGPT a révélé, à la fois, la maturité de la technologie IA qui lui permet de se déployer dans le secteur grand public, et aussi une propension du public à l’intégrer dans ses usages, y compris dans la création.

Elle est déjà utilisée dans de nombreux domaines, tels que la santé, la finance, la logistique et la production. Néanmoins les bouleversements induits par l’IA sont encore peu visibles.

L’intelligence artificielle suscite à la fois la crainte qu’elle ne remplace massivement des travailleurs humains mais aussi l’espoir d’amélioration des conditions de travail, voire de création de nouveaux métiers. Il est important de prendre conscience des opportunités et des menaces potentielles de l’IA afin de pouvoir l’utiliser de manière responsable et éthique.

Opportunités de l’IA
L’IA offre de nombreuses opportunités pour améliorer nos vies :
• Résoudre des problèmes complexes : l’IA est déjà utilisée pour développer de nouveaux médicaments, pour diagnostiquer des maladies et pour créer des systèmes de défense contre les cyberattaques.
• Améliorer l’efficacité : l’IA peut être utilisée pour automatiser des tâches répétitives ou laborieuses, libérant ainsi les humains pour se concentrer sur des tâches plus créatives et intellectuellement stimulantes.
• Créer de nouvelles opportunités économiques et sociales : Par exemple, développer de nouveaux produits et services, créer de nouveaux emplois et améliorer l’éducation.

Le Forum économique mondial estime d’ailleurs que, d’ici 2025, même si l’IA devrait remplacer quelques 85 millions d’emplois, elle en permettrait la création de 97 millions.

Notons que 60 % des emplois d’aujourd’hui n’existaient pas en 1940.

Menaces de l'IA

Menaces de l’IA
Selon une étude récente de l’Organisation Internationale du Travail (OIT), ce sont les emplois basés sur des compétences cognitives de base, tels que les emplois de bureau ou l’analyse de données, qui sont les plus exposés à l’arrivée de l’IA.
Le chômage : l’IA est utilisée pour automatiser des tâches qui sont actuellement effectuées par des humains, comme la conduite de véhicules, la fabrication de produits et la prestation de services. La création d’emploi en parallèle est-elle assurée?
L’inégalité : l’IA pourrait accroître les inégalités sociales, les personnes ayant accès à l’IA et aux compétences nécessaires pour l’utiliser étant limitées.
Les risques éthiques : tels que la responsabilité des décisions prises par des systèmes d’IA, la protection de la vie privée et la prévention des discriminations.
Puissance des GAFAM (géants du Web) : avec le rôle central qu’occupera l’IA dans de nombreux secteurs d’activité à l’avenir, les acteurs majeurs (Google, Amazon, IBM…) pourraient devenir incontournables et définir eux-mêmes les règles du jeu.

Compte tenu de la puissance de l’outil et de sa rapidité de développement, les pouvoirs publics se sont emparés de la question, notamment pour étudier les impacts dans les secteurs structurels (emploi, éducation, justice, sécurité, santé publique…).

Le rapport du Conseil d’État rédigé en 2022 plaide pour le développement de l’IA dans les services publics sous réserve du respect de sept príncipes :
• la primauté humaine ;
• la performance ;
• l’équité et la non-discrimination ;
• la transparence ;
• la sûreté (cybersécurité) ;
• la soutenabilité environnementale ;
• l’autonomie stratégique.

Le Parlement européen s’est prononcé le 14 juin 2023 en faveur du projet européen de régulation de l’intelligence artificielle.

Un équilibre semble donc possible entre l’adoption de l’IA pour améliorer l’efficacité et la productivité ainsi que la préservation des emplois. Le cadre devra néanmoins être structuré et des programmes de promotion, de formation, d’adaptation et de reconversion seront indispensables.

Le marché mondial de l’IA, qui a été évalué à 136,55 milliards USD en 2022, devrait connaître une croissance annuelle de 37,3 % entre 2023 et 2030. Les promesses de cette 4e révolution industrielle sont donc vertigineuses et les opportunités d’investissement sont nombreuses.

N’hésitez pas à nous contacter afin d’obtenir les réponses d’un professionnel aux questions que vous vous posez.

Sources: cabinet d’étude McKinsey,, Organisation Internationale du Travail

Memories are made of this

By David Hattersley
This article is published on: 12th March 2024


Thank you Deano, glass of wine in one hand and that mellow voice. Don’t worry this older, hopefully wiser Financial Adviser is a bit like that glass of wine, it mellows. Without a doubt, there have been immense changes in both my industry and life.

I started in the industry in 1987,at a time of rapid change. Privatisation, deregulation, right to buy, the “Big Bang” in the City, personal pensions, PEP’s, ISA’s, etc.

Changes in other fields occurred eg. traditional Optical Practices were challenged by a retail outlet offering a greater range of inexpensive glasses. It is now a global brand company. If you can’t read this, you should have gone to ……… !!! Many non Ophthalmic opticians came to own their own franchises and prospered. I dealt with quite a few.

Technology was advancing rapidly. Remember the 1st so called mobile phones? Massive batteries- if you tried to take it on board a plane as hand baggage today a budget airline would say too heavy, and charge you for hold luggage.

My 1st lap Toshiba laptop was used to provide illustrations. The games, awesome! Ping pong and zapping those little creatures coming down from the top. Microsoft was starting to lift off. Search engines were becoming available – eg “Ask Jeeves”.

Papers were full of financial news and even ”the Sun” had a page. No br…ts on that page! There was “Spitting Image” with a fair portrayal of some sectors of the press. A former CEO of a major financial services company told me that he ignored the “daily’s”, and only read the weekly addition of the FT on Saturday. The devils in the detail, so a “fad” can be created by misinformation & lack of due diligence. An example of a “fad” was the Dotcom crash, with “mates in the pub” telling their friends how much they had made. Basic fundamentals were not considered, greed came to the fore. I advised my clients not to purchase these assets, was ignored by one client and sadly he lost money. I experienced other so called opportunities where my advice was ignored and money was lost.

It wasn’t only with individuals where mistakes were made. Less regulated mortgage lending along with Lawson’s last budget in 1998 stopped additional mortgage tax relief to each single unmarried couple. House prices continued to rise in what was already a bubble, but slowed in 1989 and began falling. Then ERM. That crash lead to negative equity and a recession,& the demise of the Major government.

Then Blair was in charge. Cool Britannia, the fall of the Soviet Union, continuing Globalisation, 9/11, and subsequent wars. The banking crisis of 2007, resulted in chaos. Relaxation of regulations, greed, lack of understanding, due diligence and negligence were major contributory factors.

Quantitative Easing was introduced 2008 -2012 leading to a reduction in interest rates. It did not prevent recessions in many parts of the world, but gradually economies began to recover.

The last 4-5 years have been challenging, Covid, war in Ukraine, Gaza, slowdown of growth in China, politics dividing countries, Brexit, looming recession in some countries. It may seem that its never ending but these things are cyclical. It doesn’t matter where the recession is, there is always someone that benefits from it. Warren Buffets quote “When everybody’s being greedy, be fearful, when everybody’s being fearful be greedy”! Apply that to the many of examples I’ve already mentioned this quote certainly rings true.

What I do is simple, nothing has changed the process. Better regulation makes it more complex and detailed, but is that a bad thing? I don’t think so. My role is to understand clients objectives, and help them navigate the complexities. Levels of risk/reward need to be considered. Annual reviews continue the process taking into account any potential changes. Dealing with an ageing population needs compassion, understanding and patience.

Looking back, nothing really changes in my chosen field, life does not follow a straight line and is often unpredictable. Investment should always be based on the long term, short term knee jerk reactions should be avoided. I still love what I do after all these years, it’s in my blood, so please feel free to contact me to arrange a no obligation meeting over coffee.

Do you need to submit a Modelo 720?

By Barry Davys
This article is published on: 16th January 2024


Do you need to submit your M720 to the Hacienda before 31st March?

If you have assets outside of Spain you may need to report these to the Spanish tax man on the Modelo 720. In effect it is a “census” as it does not trigger any payment of tax. However, it does help the Hacienda cross check information.

If you have bought or sold an overseas asset in the last calendar year, you may need to submit a M720, even if you have previously submitted a form. Also, if the value of your overseas assets have increased by more than 20,000€ since you last submitted a form you may also need to re-submit. If the answer is “Yes” you must submit your form before the 31st March.

Here is a link to the obligation to report on the Agencia Tributaria (Hacienda) website which lays out if you need to report your bank accounts, investments and properties that are outside of Spain. Google Translate does a good job of translating this, if needed.

You may have seen in the press that the European Court ruled on the M720 rules. I am pleased to report that the fines for non-reporting or mis-reporting have been struck out by the court and new, much lower, fines will be put in place.

Please note that we are seeing articles saying the M720 is no more. This is not the case. In fact the court, whilst removing the very high fines, also said in it’s ruling that they could see the need for the M720.

Please feel welcome to email me if you have any queries about your Modelo 720. If your query relates to share options and the M720 you can choose a time that is convenient tor you for a call using my online system.

Are there ISAs in Spain?

By Chris Burke
This article is published on: 14th January 2024


When living in Spain it shouldn’t take too long to discover that personal finances work very differently from many other European countries, particularly the UK. Independent advice is hard to find – most people talk to their bank and are told that their main option is to invest in the bank’s own standard products and solutions, which for many people are not suitable or appropriate.

Many people from the UK are used to a more sophisticated way of investing, maximising tax efficiency and mitigation through solutions such as ISAs and pensions. These can greatly reduce the tax you pay making a big difference to the amount of money you end up with, in some cases incredibly so.

Is there a Spanish equivalent of a UK ISA?
In short, there is something very similar. It can greatly reduce the tax you pay as your investment grows and can even be set up for your children to benefit independently.

Are there Spanish equivalents of a private pension in Spain?
Yes, there are, however these are vastly different to in the UK. In the UK you can contribute up to £60,000 per year to a private pension. In Spain you can only contribute €1,500 per year. A self-employed person can contribute an additional €4,250 per year. Very few employers in Spain have their own pension schemes and those that do have a limit of €10,000 per year that can be jointly contributed to.

Reducing the tax on your investments

How does the equivalent of the UK ISA in Spain work?

As your money grows any gain you make is not taxable until you receive this money (achieving compound growth). When you access this money, any gain is offset proportionally against the original investment amount, and as such removing this proportion of the gain. For example, if your investment grows by 50%, any partial withdrawals you make have this portion deducted against the gain you have made. Over the years this can make an incredible difference to the tax you pay, particularly as this investment income falls under Capital Gains tax (savings tax) and not income tax, which can become VERY important when paying tax on your monies (pension income falls under income tax).
As a reminder, the tax rates are:
Capital gains tax ranges from 19-26%, income tax from 24-47%.

Many people use this option for their mid-term and retirement planning because they have some flexibility, are portable should you move elsewhere and are also highly tax efficient and compliant in Spain.

Important note on UK ISA’s

Whilst UK ISAs are tax efficient in the UK (all gains are tax exempt), as a Spanish tax resident this is not the case – any gains that arise in your UK ISA must be declared annually and tax paid on these even if you do not access the money. This makes UK ISAs as a Spanish tax resident very inefficient and why many people look for alternatives.

UK ISA Tip when moving to Spain
Before you become a Spanish tax resident, if you encash your UK ISA you realise any gains that would be taxable when you become a Spanish tax resident. This not only includes any annual gain, but more importantly the gain from inception, which as a Spanish tax resident you would be liable for when you encash.

If you would like any more information regarding any of the above, or to talk through your situation initially and receive expert, fact based advice, don’t hesitate to get in touch with Chris.

Click here to read independent reviews on Chris and his advice.

Interest in deposit accounts

By John Hayward
This article is published on: 11th January 2024

Interest in deposit accounts

As we enter a new year, we face another year of known and, so far, unknown global problems which could impact our finances. Many “experts” will guess and then advise us what will happen but, as so often in the past, be wrong, or lucky if the guess works out to be true. The world is governed by a handful of people. Therefore, there are very few who really know what is happening.

Fortunately, in the Western world at least, we are allowed to get on with our lives with an element of freedom. As financial advisers, especially as old as me, we can make some judgement based on how people react to global events. Some people over react, fed by questionable journalism. In the investment world, this leads to the wealthy becoming wealthier aided by panic selling by the less wealthy enabling the wealthier to buy into the market at a lower cost.

2022 was a rotten year overall for investments. 2020 was not great but people then were more concerned about living with Covid-19 than what was going on with their money. Stock and bond markets both had a torrid time, mainly as a consequence of Covid-19 which introduced high inflation once we had a chance to spend money again. A consequence of this was a reluctance in 2023 to commit to investing at a time where inflation was rampant. History has shown us that investing in traditional markets can overcome inflation. With high inflation came attractive interest on cash, something that we had not seen in decades. Back to the history book and we see that interest rates on deposit accounts have not outpaced inflation over the long term. However, the expression “long-term” seems to disappear from the vocabulary of some investors and short-term problems become the index to follow. Many have caught the interest rate bug over the last few months feeling that doing this would be sensible in the short term and then switch into investment markets when the time is right(?). Paraphrasing Jim Bowen of Bullseye fame, “Let’s look at what they could have won” had they not taken this approach.

Let us look at two different examples of investors. One who was invested on 1st January 2022 with 50% in the Rathbone Strategic Growth fund and 50% in Aegon High Yield Bond fund who decided to sell on 31st December 2022 due to the downturn in 2022 and another who was thinking about investing on 1st January 2023 but decided not to. In both cases, they eventually put their cash into a deposit account with a fixed rate of 5% (for 12 months) in July 2023.

1/1/22 to 31/12/222 1/1/23 to 31/12/23
Rathbone and Aegon -9.10% 11.45%

The person who sold from the two funds at the end of 2022 was 9.10% down for the year and only recouped 2.50% (6 months at 5% p.a.) by the end of 2023 instead of 11.45%.

In a similar way, the potential investor, who was holding off until things improved, missed that particular bus. Again 2.50% versus 11.45%. I appreciate that there are underlying charges with our products but nowhere near 9% a year and there are also tax considerations with the deposit account being taxed annually whereas the Spanish compliant bonds that we promote have tax deferred, if not completely negated.

Very few are smart enough or knowledgeable enough or lucky enough to time markets correctly. In the last year we have seen this proven once again.

When I tell people that they should be prepared to leave their money invested for at least 5 years, I often get the response that they are not young and that they may not survive 5 years. In a region such as the Costa Blanca where I live, with 300 plus days of sunshine a year and plenty of olive oil, the risk people face is living too long! In the “good old days” when the life expectancy was 65 or less, long term care and dementia were not a consideration. Making money work over the long term is not only a good idea but possibly essential.

We have products that can work with you and your family throughout your life, and beyond. Following the scaremongering headlines is not a great idea and can be very harmful to your wealth, and your health.

I know that it is possible to solve a Rubik’s Cube wearing boxing gloves but try it.

Livret A : Protection ou illusion face à l’inflation ?

By Cedric Privat
This article is published on: 5th December 2023


«Vous voulez faire fructifier votre épargne de manière sécurisée et sans payer d’impôt ? Vous pouvez ouvrir un livret A». source site officiel de l’administration française.

Avec pas moins de 56 millions de livrets A comptabilisés à fin 2022, cette publicité semble avoir séduit les Français, mais qu’en est-il réellement de ce placement dont le taux d’intérêt est fixé par l’État ?

Le livret A est le placement préféré des Français. Huit Français sur dix le détiennent et ils ont déposé près de 26 milliards sur ce produit d’épargne sur les six premiers mois de l’année 2023. Du jamais vu…

Le Livret A est un placement sûr et liquide, ce qui signifie que vous pouvez retirer votre argent à tout moment sans pénalité. Le ministre de l’Économie et des Finances, Bruno Le Maire, a récemment fait le choix de maintenir son taux de rémunération à 3% soit l’assurance de bénéficier d’un taux fixe jusqu’en 2025.

Malgré son succès, ce produit d’épargne est souvent critiqué pour sa faible rémunération.

Ci-dessous un comparatif des 5 dernières années face à l’inflation :

Années Taux annuel du livret A Taux d'inflation
2023 2.92% 5.60% (prévision Banque de France)
2022 1.38% 5.20%
2021 0.50% 1.60%
2020 0.52% 0.50%
2019 0.75% 1.10%
Sources: Banque de France, Insee

Récemment, le gouvernement a dérogé à la formule de calcul fixant son rendement, calcul qui aurait potentiellement amené le taux à plus de 4%.

Le Livret A ne protège donc pas les Français d’une perte de pouvoir d’achat, et ne constitue pas un “rempart” contre l’inflation. Le taux réel étant négatif, l’argent placé perd de sa valeur au fil du temps.

Le livret A reste pertinent pour certaines situations
Par nature, le Livret A étant garanti, son rendement est faible. Mais malgré sa faible rémunération, il peut toutefois convenir à certains épargnants.

Il est simple, accessible à tous et garantit un capital entièrement disponible à tout moment.

Il permet de limiter le phénomène d’érosion monétaire pour ces sommes épargnées à court terme, afin de faire face à des besoins exceptionnels.

Le livret A est conçu pour constituer un matelas de sécurité. Il est recommandé de laisser sur son Livret A une épargne de précaution correspondant à 3 à 6 mois de dépenses courantes, de manière à faire face aux imprévus.

Quelles alternatives ?
La réponse dépend principalement des objectifs d’épargne, de la disponibilité recherchée et du profil de risque de chacun.

Pour les épargnants prêts à accepter un peu plus de risque et limiter la disponibilité quelques années, il existe des placements offrant de meilleures perspectives de rendement.

L’assurance-vie (produit le plus diversifié), le placement en actions (le plus dynamique) ou les SCPI (le plus stable) seront les options les plus cohérentes.

Le pouvoir d’achat est au centre des préoccupations des français et l’investissement est un moyen qui permet réellement de se prémunir de l’inflation et de construire ses projets d’avenir. L’épargne et l’investissement ne répondent pas aux mêmes enjeux.

Lorsque l’on dispose a minima de trois ans devant soi, il est inutile de laisser dormir cet argent, que ce soit sur un compte courant ou sur un livret.

N’oublions pas ce principe phare de la finance : il n’y a pas de rendement sans risque.

Le groupe Spectrum à Barcelone se propose d’étudier gratuitement votre situation afin de vous aider, de vous conseiller, de vous orienter ou de vous guider dans vos démarches patrimoniales.

N’hésitez pas à nous contacter afin d’obtenir les réponses d’un professionnel aux questions que vous vous posez.