Stock Markets

You will have no doubt seen further press coverage regarding stock market downturn and the impact of sub prime mortgage debt in America. This volatility is likely to continue into the coming month and we would recommend that you stay calm until this period of uncertainty has passed. The events of the last few weeks have been a useful lesson for all investors to see that losses can be made, as well as gains, but it is important to not let a wobble affect your financial stability. When the sea gets rough and decision making is tested, the importance of a strong crew supporting you cannot be underestimated - here at Argyle, we are that crew and we manage well constructed and well monitored portfolios on your behalf.

We hope you appreciated our additional newsletter in August on stock market volatility and its relevance to your own portfolio. We were pleased to see that many of you, following receipt of the newsletter, visited your account online (some for the very first time) to view your portfolio details. We actively encourage this interaction and would like to remind you that all you need is your account number and your PIN to access your information at any time. If you do not have this information, we would be happy to supply you with new security details.

Child Trust Funds

Whilst it has been 10 years since Princess Diana died, another significant anniversary has just passed with virtually no coverage. It was 5 years ago that the Government introduced Child Trust Funds (CTFs) by giving every new born a minimum of £250 to be invested on their behalf until the age of 18. Over 2.6 million accounts have been set up but over a quarter of the vouchers sent out have not yet been used. Parents have a year to invest the voucher in a long-term CTF account - either cash, stakeholder or equity, before the money is allocated to a default provider.

The surprising news being reported from CTF providers is the lack of additional monies being added into these accounts. Parents, relatives and friends can invest up to £1,200 a year into the CTF on top of the start-up voucher, which can then grow free of tax. Making regular contributions could boost the account significantly over the long term and can help saving in a tax free fashion.

There looks to be increased prominence given to these accounts now as part of a newly announced Government initiative where Primary school children are to be taught basic personal finance using CTFs as a learning tool. As part of their maths lessons children will learn how to open a bank account, understand concepts like interest rates, and plan for their financial future.

Ed Balls, secretary of state for children, schools and families, said: ‘It’s never too early to encourage children to think about money and saving for the future and we want to ensure that every child, no matter what their background, has the financial skills to achieve whatever they want in life.

‘The CTF provides children with a financial head start and through the extra funds announced we plan to use it to make personal finance real and tangible in the classroom. By the time the first children with a child trust fund leave school they will have the skills and confidence to manage their money well.’

If you would like advice on how to invest one of these vouchers or how you can invest money for a grandchild before you get quizzed by them about it, please do not hesitate to contact us.

www.argylefinancialgroup.co.uk