Nearly two weeks have passed since the referendum and it's all change. Blue Spire answer a few questions and offer help and advice.

Politically 

• Boris Johnson won't become the new Prime Minister - yet
• Nigel Farage has stepped down as UKIP leader
• George Osbourne, instead of implementing an emergency budget, has announced a future cut in Corporation Tax, to encourage investment in the UK
• Economically
• The Bank of England may reintroduce Quantitative Easing and interest rates may fall further
• Some investment markets have bounced back following falls they suffered immediately after the referendum result

Questions and Opinion

Why could currency fluctuations be bad for the UK?

• Many world commodities are bought in dollars.  As the pound has fallen significantly against this currency, we can expect price rises in many of the goods we buy
• You may get less currency if you're holidaying in the Eurozone

What could happen if the Bank of England reintroduces Quantitative Easing

• We could see another fall in annuity rates, which means those approaching retirement may get a lower income if they need to buy an annuity in the short-term.  However, they will have other retirement options open to them, which may give them a better deal
• What could happen to property prices?
• In the short-term buyers may delay or cancel their purchase, due to uncertainty about their financial circumstances, and concerns they may be buying 'at the top of the market'.  This may lead to lower demand and falls in house prices.  Over the longer term we would expect these losses to even out.
• We've already seen the suspension of Standard Life, AVIVA and M&G property funds, as many investors withdraw money from these types of funds.

Are we heading for another recession?

It's too early to tell but if the general uncertainty continues it could mean consumers delay or cancel other purchases, which could lead to slower economic growth, lower wage rises, etc

Will the government row back on it's commitments?

The 'triple lock' for the State Pension may be altered or removed as it's very expensive - currently, the basic State Pension increases each year by the highest of:

• the growth in earnings in the UK
• the growth in prices in the UK
• 2.5%

In summary, we're probably not out of the woods yet. For further comment you can visit:

• EU referendum - from What if, to What now http://www.bbc.co.uk/programmes/b07h2v30
• BBC Money Box - Brexit - what does it mean for your finances http://www.bbc.co.uk/programmes/b07h2vjm

 

How can Blue Spire help?

They'll guide you through these short term issues and provide advice on how you can still achieve what's important to you

If you need to contact them please use the following: Email - info@blue-spire.com