What you make of Burnham

How do you feel about Andy Burnham? 

Last week, in response to our survey, you told us that you were broadly neutral about his policies in general but 50% thought he would be negative for your personal finances, with just 7% saying he would be positive. The general vibe was that he would be OK for Britain but “worse for me.”

The major concern was tax. Three-quarters of all respondents worried about Capital Gains Tax

(CGT) and 64% of you were concerned about a potential wealth tax.

The most worried are the very confident investors. Which makes sense. Those who have had higher risk profiles have made the most over the last few years. Not one of those who say they’re a very confident investor thought that Burnham would be positive for their finances. And 55–64-year-olds are the most gloomy.

Maybe that’s just because it’s a bit hot, you’ve got indolent teenagers loafing around doing your nut in (just me?) and you can’t afford to retire or go on the extended beach holidays of the adverts. Or possibly you don’t have the perks of a final salary scheme pension or the triple lock pension, nor the optimism of youth?! 

And men are more negative about Burnham. Women are more likely to reserve judgement and say that they will wait and see.

Your views

In the positive camp:

In the negative camp:

Over in the (angrily) funny camp: 

And the mild despair camp:

Wealth takes centre stage over income

What is clear is that the new global debate has shifted to a focus on wealth over and above income. Most recently, Inheritance Tax has fuelled dissent at home, manifested physically by angry farmers descending on Westminster in tractors to protest.

It’s true that the wealth divide is becoming more pronounced. There are those who have assets and invest. And those who don’t. And this is not just played out amongst the rich and famous.

Anyone who invested £1,000 in the main US S&P 500

index just 3 years ago is now sitting on about £1,600 today. Roughly. Magnify this to £100,000 and there’s a profit of £60,000. One and a half times the average UK annual salary (£39,039 a year according to the Office for National Statistics).

This is just us mere mortals. The most visible rich men in the world today (yes, they’re men) have made billions and often it’s from technology. Elon Musk - someone who I think deserves both the descriptor of genius and tw@t – is their poster boy. He has meddled in politics, stirred up hatred and presided over the cesspit which is X. Many of the richest people in the world have made their money from the very technology which is ruining our children’s mental health and peddling the lies of everyone else being richer, happier, thinner and smarter than us. The essence of their wealth is the source of much unhappiness. No wonder there is disquiet – it’s not just wealth but also how it’s being made. At least homegrown entrepreneur James Dyson made a useful hoover. (Well – sort of – although I swear by a Henry myself…)

Yes, yes, enough waxing lyrical, Holly, what can we do?

• I think higher CGT is a question of when, not if. So, love ISAs. Save as much of your £20,000 annual allowance here as possible. If you like Cash ISAs, remember the changing rules from next April if you’re under 65.

• We can currently make £3,000 of gains tax-free each year. If you’re married or have a civil partner, your tax-free limit could be a gift of love for an investing partner who could transfer gains-making shares to you. Much more romantic than a bunch of chrysanthemums from Esso.

• Love pensions. Higher rate taxpayers in particular. If you pay already taxed income into one, we all generally get basic relief when we pay into a pension (which is 20p for every 80p in England and Wales). So 80p turns into a £, ta da! AND higher rate taxpayers get a tax rebate in January, which is the only fun to be had this month when you are a post-Christmas fattypuff living on a small island in the Northern Hemisphere. Pension contributions are also a good way to get taxable income down – worth investigating for parents who earn around £60k or more, who should investigate the higher-income childcare benefit caps, AND for high earners nudging £100,000 a year.

• Plan for Inheritance Tax (our free webinar will help!). It now impacts about 1 estate in 20 and it’s rising.

• And finally – invest! Yes, AI is over-priced and yes, there will inevitably be a correction and yes, the corporate world is full of weirdo psychopaths, BUT drip-feeding into global stock markets little and often is how we make more of our long-term money. Even if ‘they’ take more and more of it in tax. If you don’t know where to start, try a global shares tracker or ‘Exchange Traded Fund’.

Thank you for tolerating my mild technology CEO bro rant. It’s the first full day back after a summer holiday. I’m missing my lunchtime glass of rose and a snooze! Normal service will resume next week :0) Perhaps ironically, I will close by saying I’m (a touch grumpily) doing more stuff on Instagram (don’t get me started on Zuckerberg) so you can follow me there for more frequent postings on markets, taxes, swimming, wine and my dog. No pouty lips or happy clappy stuff is tolerated.

Holly