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Reaching the minimum pension age and being able to access your retirement savings might mean new possibilities opening up. You may start thinking about giving up work, withdrawing a lump sum to pursue a goal, or using your pension to boost your regular income.

It’s an exciting time, but it’s also important to evaluate your decisions and consider how they could affect your long-term plans. Indeed, spending too much too soon could lead to a shortfall later in life.

Usually, you can access your pension from age 55 (rising to 57 in 2028). For many people, this milestone will come before their planned retirement date.

Yet, January 2025 research from Legal & General suggests 1 in 5 people access their pension at 55.

32% of those withdrawing from their pension at 55 said it was to cover essential expenses. However, 46% simply said they did so “because they could”.

Worryingly, 27% of UK adults aged over 50 make decisions about their pension without seeking any advice or guidance. It could mean a significant proportion of those accessing their pension as soon as possible don’t fully understand the long-term implications it could have.

If you’re thinking about withdrawing money from your pension, here are three potential risks to consider first.

1. It could increase your risk of running out of money later in life

Pensions are often among the largest assets people own. So, it’s not surprising that some look at the value and believe they have enough to splurge.

Yet, it’s important to consider why you’ve saved into a pension – to create financial security once you give up work.

If you start accessing your pension at 55, you could be at greater risk of facing a shortfall later in life as it’s likely to need to last several decades. Indeed, according to the Office for National Statistics, the average 55-year-old woman will live until they’re 87. For a man of the same age, life expectancy is 84.

Even if you don’t plan to take a regular income from your pension straightaway, withdrawing a lump sum can have a significant effect on the value of your retirement savings.

Your pension is normally invested with the aim of delivering long-term growth. Taking a lump sum could mean investment returns are lower than expected, which, in turn, may lead to a lower income when you retire.

That’s not to say you shouldn’t access your pension at 55, whether you want to use the money to travel or start reducing your working hours. However, understanding the potential long-term implications of doing so and how it might affect your retirement lifestyle is important.

2. You may face an unexpected tax bill

You can usually withdraw up to 25% of your pension without facing a tax bill, either as a lump sum or spread across multiple withdrawals.

However, if you exceed the 25% tax-free portion, your pension withdrawals may become liable for Income Tax. According to the Legal & General study, around a third of those accessing their pension at 55 are withdrawing more than 25%.

The withdrawal above the tax-free amount would be added to your other sources of income when calculating your Income Tax liability. So, you might want to consider whether it would push you into a higher tax bracket and increase your overall tax bill.

It’s also worth noting that if you receive means-tested benefits, taking a lump sum or income from your pension could affect your entitlement – something a quarter of people didn’t realise.

3. It could limit how much you can tax-efficiently save in your pension

Accessing your pension might reduce how much you can tax-efficiently contribute to your pension each tax year.

In 2024/25, the pension Annual Allowance is £60,000. This is the amount you can personally contribute while retaining tax relief benefits. However, you can only claim tax relief on up to 100% of your annual earnings.

You can normally withdraw your tax-free lump sum from your pension without affecting the Annual Allowance, but if you take a flexible income, you might trigger the Money Purchase Annual Allowance (MPAA).

The MPAA is just £10,000 in 2024/25. As a result, it can significantly reduce how much you’re able to tax-efficiently add to your pension and it might negatively affect your retirement income.

Financial planning could help you understand the effect of accessing your pension at 55

One of the challenges of understanding whether accessing your pension sooner is the right decision for you is that you often need to consider the long-term effects.

Financial planning could help you see how accessing your pension at 55 might affect your long-term finances and review other options as part of a wider financial plan. If you withdraw some of your pension now, it could help you feel more confident, or you might decide an alternative option makes more sense for you.

If you’d like to access your pension, we’re here to help you calculate the potential long-term consequences and more. Please get in touch to arrange a meeting.

Please note: This blog is for general information only and does not constitute financial advice, which should be based on your individual circumstances. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation, and regulation, which are subject to change in the future.

The Murdoch family’s messy dispute over who will retain control of Rupert Murdoch’s media empire when he passes away has been grabbing headlines. While your affairs might not be in the spotlight, the case offers some useful insight into how to avoid family disputes.

Following his second divorce in 1999, Rupert Murdoch established a trust foundation to hold the family’s stake in News Corp. While the Murdoch family holds a 14% stake, it controls 41% of the company votes. The trust set out that when Rupert dies, control of the company would be split between his four oldest children.

A dispute arose when Rupert sought to change the terms of the trust so that his oldest son, Lachlan, would retain control and remove the voting power of his other three children.

The ensuing court case generated media attention and, ultimately, the court ruled that the family trust could not be changed.

So, what can you learn from the case when handling your estate plan and potential disputes?

1. Effective communication with loved ones is important

When setting out your estate plan or making changes to it, effective communication can make all the difference.

Rupert has stated that he believes the change to the trust was necessary to ensure the long-term profitability of News Corp. However, his three children who were set to lose their voting rights were reportedly blindsided by the news.

When someone is surprised, they might be more likely to act based on the emotions they’re feeling and it could lead to disputes escalating.

So, being clear about your wishes and setting aside some time to talk to your beneficiaries could help you understand each other’s perspective and get everyone on the same page.

2. Disputes aren’t always about monetary value

Your estate covers all of your assets, from investments to material items. When you think about which ones will be the most important to your beneficiaries, you may believe it’s the assets with the highest monetary value, but this isn’t always the case.

Indeed, emotional attachment could lead to disputes too.

In the Murdoch case, modifying the trust wouldn’t have affected the financial inheritance of the beneficiaries, only their voting rights in News Corp. Yet, they felt strongly enough about it to go to court to block the changes.

While you might not be passing on a multi-billion-pound company, your estate is likely to hold assets that are valuable to your loved ones. Even if they don’t have a high financial value it could lead to bitter disputes.

Again, speaking to your loved ones could help you form a clearer idea about what’s important to them and where issues might occur. You may find they value a particular piece of jewellery for sentimental reasons, or they’d like to inherit a painting that reminds them of a childhood home.

When you’re writing your will, you might choose to name specific items you’d like to go to a particular beneficiary.

3. Consider your family dynamics

While passing on assets that will be equally split or controlled by your children might seem like a fair way to distribute your estate, family dynamics can be complex.

For some families, sharing assets or working together to manage them can be effective.

However, if your children have very different views on how to manage wealth, it could lead to conflicts arising. For example, if your children jointly inherited your home, would there be potential conflicts around what to do with the property and who would take responsibility for different tasks?

In some cases, passing on separate assets to each beneficiary could make more sense.

An estate plan could help you understand your assets and how you might pass them on in a way that aligns with your wishes and family dynamic.

4. Consider potential conflicts when making an estate plan

Being proactive may help you avoid conflicts in the future. Considering where disputes might occur could allow you to have important conversations with loved ones or take steps to minimise the chance of them occurring before they arise.

So, when making your estate plan, you might want to consider questions like how a relationship breaking down could affect how your assets are distributed. For instance, you may take steps to ensure wealth would remain within your family if your child divorced their current partner.

5. Carefully consider your goals before establishing a trust

A trust can be a useful tool if you want to pass on assets in a way that allows you to retain some control.

When creating a trust, you’ll name a trustee to manage the trust on behalf of the beneficiaries, and you can set out conditions. The conditions you can apply depends on the type of trust you set up. So, if you want to create a nest egg for your grandchild, you might state the assets can only be used to cover educational costs during their childhood and they’ll receive full control of the trust when they turn 25.

As Rupert Murdoch has discovered, changing the terms of a trust once it’s established can be very difficult or, in some cases, impossible. Similarly, once you’ve placed assets in a trust, you may not be able to remove them.

So, if you think a trust could be right for you, take your time to assess your options.

Seeking professional advice when establishing a trust could be valuable. A financial planner might help you assess which assets to use and how transferring them may affect your financial security. In addition, a solicitor can offer advice on the different types of trusts and minimise the risk of mistakes or contradictions occurring when writing a trust deed.

6. Carry out regular estate plan reviews

As the Murdoch case has highlighted, your wishes might change over time. So, regular reviews of your estate plan could help ensure it continues to reflect your circumstances and goals.

It’s often advised that you review your estate plan following major life events or every five years.

Contact us to talk about your estate plan

Whether you need to create an estate plan or would like to review an existing one, we can help. We could work with you to understand your long-term goals, ensure your financial security later in life, and consider how you might pass on wealth during your lifetime or when you pass away.

Please get in touch to arrange a meeting.

The Financial Conduct Authority does not regulate estate planning, trusts, or will writing.

At the start of February 2025, the Bank of England (BoE) cut the interest base rate. If you have a variable- or tracker-rate mortgage, it could mean your repayments will go down. While that’s likely to be welcome news, you might want to consider overpaying your mortgage – it could save you thousands of pounds over the full mortgage term.

As well as saving money, overpaying your mortgage could mean the debt is paid off sooner. For many families, being mortgage-free is a milestone they’re looking forward to that could provide greater financial freedom and take a weight off their shoulders.

So, read on to find out why you might want to consider overpaying your mortgage.

Overpayments reduce the balance of your mortgage

If you have a repayment mortgage, your regular monthly repayments will cover the interest accrued and a portion will be used to reduce the debt.

As a result, a large proportion of your repayments could be going towards the interest, especially if you have a long mortgage term.

For example, if you borrow £150,000 through a repayment mortgage with a 25-year term and an interest rate of 4.5%, your monthly repayment would be £833 and you’d pay £9,996 over a year.

Yet, during the first year of your mortgage, your mortgage debt would reduce by just £3,325 because most of your repayment is covering the accrued interest.

As your outstanding mortgage balance falls, the amount of interest added slowly declines and a larger portion of your repayments will go towards reducing the debt.

In contrast, when you make a mortgage overpayment, this will reduce the outstanding balance. So, it can be an effective way to reduce your mortgage term and means that less interest is accrued.

Even small regular mortgage overpayments could save you thousands of pounds

According to Santander calculations from January 2025, overpaying your mortgage by the equivalent cost of just a few pints a week could save you thousands of pounds.

With the average pint of larger now costing £4.81, just three pints a week can add up to £57 a month.

The research shows that if you had a 25-year repayment mortgage of £200,000 with an interest rate of 4.5%, and you overpaid by £57 each month, you’d save £12,983 in interest alone. What’s more, you’d be mortgage-free two years and one month earlier than planned.

If you increase the regular amount you were overpaying, the benefits are even larger. In the same scenario, if you overpaid by £144 a month, the cost of around 30 pints, you’d save more than £28,000 and take four years and eight months off your mortgage term.

So, even small but regular overpayments have the potential to save you thousands of pounds when you look at the effect of them over the long term.

As well as making regular overpayments, you might choose to pay off a lump sum too.

Let’s say you have a £150,000 repayment mortgage and 15 years left on the term with a 4.5% interest rate. If you used a £15,000 lump sum as an overpayment, you’d save more than £13,000 in interest alone over the full mortgage term. You’d also be mortgage-free two years earlier than expected.

So, next time you receive a bonus or you’re deciding where to save a lump sum, you might want to consider using it to overpay your mortgage.

You might also choose to combine regular and lump sum overpayments to reduce your mortgage debt as quickly as you can.

Check if you could face an early repayment charge

Before you make regular or one-off mortgage overpayments, be sure to check your mortgage agreement.

If you have a mortgage deal in place, you could face an early repayment charge (ERC). Usually, you can pay up to 10% of the outstanding mortgage balance as an overpayment each year without an ERC applying. However, this isn’t always the case, so checking your mortgage terms could help you avoid an unexpected fee.

Contact our team to talk about your mortgage

As well as overpaying, taking out a new mortgage with a more competitive interest rate could also help save you money in the short and long term. If you’d like to talk to our team about your mortgage options, please get in touch.

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.

Those who have retired or are nearing the milestone are consistently overlooking the risk of financial shocks when compared to other generations, a survey published in PensionsAge in December 2024 suggests.

According to the report, 43% of over-50s had thought about financial shocks but not included the risks in their retirement plan. A further 32% haven’t considered risks at all.

Later in life, you might feel more financially secure than you did when you were younger, and if you no longer work, you don’t need to consider the risk of losing your job or being unable to carry out your role due to illness. So, it’s easy to see why weighing up financial shocks may become less of a priority in your later years.

However, financial shocks still have the potential to have a significant effect on your financial security and lifestyle. Read on to discover three shocks you may want to consider when you review your retirement plan.

1. An illness could affect your short- and long-term finances

During your working life, illness may have been a financial shock you incorporated into your financial plan as it could limit your ability to work. While an illness may not affect your income in retirement, it could still derail your finances.

For example, your outgoings could rise significantly. If you’re ill, you might need to factor in the cost of travelling to appointments and increased heating bills, or you might even choose to pay for private medical care. In some cases, a long-term diagnosis could lead to other large costs, such as needing to adapt your home or pay for a carer to provide support in your daily life.

If you haven’t budgeted for these outgoings or don’t have an emergency fund you can use, the cost of being ill could mean you deplete your pension and other assets quicker than you expect. This might leave you in a financially vulnerable position later in life.

Despite this, illness is something only 19% of over-50s considered when setting out their retirement plan. Similarly, just 17% had thought about the possibility of going into care.

2. A partner passing away may leave an income gap

The death of your partner can be difficult to think about. Indeed, it’s something only 18% of over-50s have fully planned for and almost a third have avoided the topic completely.

Yet, it may be an important part of creating long-term financial security for both you and your loved one. If one of you passed away, how would it affect the surviving partner’s finances in the short- and long-term?

For instance, if just one of you has an annuity that pays a regular income throughout retirement, this would stop when the person passes away, potentially leaving an income gap for the surviving partner. To mitigate this risk, you might select a joint annuity instead, which would continue to pay an income to the surviving partner for the rest of their life.

So, while these types of conversations can be emotional and challenging, having them and adjusting your retirement plan, if necessary, could offer peace of mind that you or your partner will be financially secure if the other passes away.

3. You might want to support other family members

If your child, grandchild, or other loved ones faced a financial emergency, would you want to offer them support?

Many people will answer “yes” to this question. Yet, only a small proportion of over-50s have considered how they’d lend a helping hand in retirement. As part of their retirement plan, 16% of parents have included a provision in case their children need urgent financial support and 7% have thought about how they may need to support their parents.

If you haven’t thought about how you’d lend support, it could mean you’re unsure how to respond if a loved one approaches you for help. It may lead to a decision that’s not right for you and could affect your long-term finances.

For instance, if you were to withdraw a lump sum from your pension to gift to your child, you could be faced with a larger tax bill than you expect, and it might have an impact on the long-term investment returns of your pension. Instead, depending on your circumstances, depleting other assets, like savings, could be more efficient.

Making this type of financial shock part of your retirement plan could mean you’re able to feel confident in the support you provide.

While you’re weighing up how to support your loved ones, you may want to review your wider estate plan, which includes setting out how you’d like your assets to be distributed. For some, this will involve writing a will that will state how assets are to be divided when you die. You may also consider gifting during your lifetime.

If you’d like support when reviewing your estate plan, please get in touch.

Considering financial shocks could boost your confidence in retirement

While weighing up the risk of financial shocks might seem like a daunting task, it may lead to you feeling more confident about your retirement. Knowing you’ve taken steps to improve your financial security, even if something unexpected happens, could allow you to focus on enjoying the next chapter of your life.

Get in touch with our team to talk about which steps may mitigate the effect of financial shocks during your retirement.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

The Financial Conduct Authority does not regulate tax planning or estate planning.

How long do you leave essential tasks on your to-do list? If you’ve put off tasks because they feel overwhelming, you’re not alone, but delays could be harmful. Read on to find out how financial planning may help you overcome decision paralysis.

According to a January 2025 study from the Post Office, half of adults in the UK have delayed important tasks because they feel too overwhelmed. As well as potentially affecting your plans, procrastinating can harm your wellbeing. Indeed, 63% of survey participants said they feel “weighted down” by their to-do lists.

Commonly delayed tasks include writing a will (25%) and filling in tax returns (18%). For those under 35, managing a pension was also a common sticking point, with 87% feeling overwhelmed by the task.

For some, procrastination can be due to having too many options or worrying about making the “right” decision, leading to decision paralysis – where you know you should tackle a task but don’t know where to start or what to do next.

If it’s financial tasks you’ve been putting off, working with a financial planner could help you overcome decision paralysis.

We can help you prioritise your to-do list

If you have a long to-do list, one of the first challenges might be deciding where to start. Should you write your will first, or spend some time reviewing your pension options?

As your financial planner, we could help you prioritise the tasks depending on your circumstances and needs. Having a clear order could mean your list feels more manageable and give you the confidence to focus on one thing at a time, which could be more productive than trying to multitask.

We can explain the different options to you

Modern life often means you have a lot of options. While this can be a good thing, it may also feel overwhelming as well – how do you sift through all the different options and decide what’s right for you?

This can affect many aspects of your to-do list, including financial tasks. Perhaps you want to start investing but aren’t sure where to invest or how to create a balanced portfolio that reflects your goals. Or maybe you want to set up a trust to protect assets for your child, but you aren’t sure how to compare the different types of trust.

Working with a professional means you have someone to turn to when you have questions. It might mean your options are clearer and you feel empowered to make a decision.

With 30% of people telling the Post Office survey too much information was a barrier for them completing tasks, having someone who can simplify the details and highlight which parts might be important for you could be invaluable.

We can help you understand the long-term effect of your decisions

Financial decisions may be complex and could affect your long-term financial security. So, decision paralysis might occur if you’re worried about making the “right” choice.

Let’s say you’re ready to retire and access your pension. You may be concerned about withdrawing too much and running out later in life. Or you may be unsure if purchasing an annuity or taking a flexible income is right for your lifestyle.

A financial planner could help you understand the long-term effects of your decisions, so you can feel confident about the future.

This may include using cashflow modelling to visualise how your wealth might change depending on how much income you withdraw from your pension each year. You could even use it to model financial shocks to see how you might create a safety net, which may put your mind at ease and help you move forward with a decision.

We can handle tasks on your behalf

43% of UK adults told the Post Office survey that they would hire a personal assistant to help them with life admin if they could.

If you want to take a hands-off approach to managing your finances, building a long-term relationship with a financial planner could be right for you. We’d take the time to understand your aspirations and how your assets might be used to support them to create a tailored plan.

With regular reviews, we can work with you to ensure your plan continues to reflect changes to your circumstances and wishes and make adjustments if necessary.

Contact us to create a financial plan that works for you

If you’d like to review your finances and how they might support long-term goals, please get in touch. We could work with you to create a tailored plan that suits your needs, offers a clear direction, and provide ongoing support should you have any questions or concerns.

The Financial Conduct Authority does not regulate trusts or will writing.

When you’re making large financial decisions, basing them on facts and logic could help you choose the option that’s best suited to your needs. Yet, even when you take this approach, cognitive biases may affect the conclusions you draw.

Over the last few months, you’ve read about how past experiences and emotions might affect your financial decisions. Now, read on to find out more about cognitive bias.

Cognitive bias refers to processing errors that might arise from problems with your memory, attention, attribution, or other mental mistakes.

Lots of different factors can affect how you think from your attention wandering if you’re feeling stressed about something else to mental shortcuts known as “heuristics”. Cognitive bias happens to everyone, so read on to discover how it could affect your financial decisions.

1. Confirmation bias

Researching your options when making an investment decision is important. However, confirmation bias might mean you don’t give new information the attention it deserves.

With this bias, you’d favour data that corroborates your pre-existing belief. So, if you already believe that a particular investment opportunity is right for you, you’ll seek out information that supports this view. It could mean you dismiss vital details because it contradicts what your mind has already decided.

By focusing on information that confirms your belief, you may end up making investment decisions that aren’t appropriate for your goals or financial circumstances.

2. Anchoring bias

Anchoring bias occurs when you rely too heavily on a single piece of information, so your views are “anchored” when making decisions.

When you’re investing, the anchor might be the first piece of data you see, such as the value of a stock or share, or you might focus on it because of where it’s come from, like a trusted friend.

Tethering your decisions to a piece of information that might not be relevant can be damaging.

For example, as an investor, you may anchor how you value a particular investment to the price you initially paid for it rather than assessing its current or future value. This could mean you’re more likely to hold on to an investment even if that doesn’t align with your wider investment strategy.

Anchoring bias could lead to you avoiding new opportunities or failing to make changes because you’re focused on a particular data point instead of looking at the bigger picture.

3. Framing bias

How opportunities are presented to you could affect how you perceive them.

Imagine you’re talking to a friend about an investment. If they say there’s a 20% chance that you’ll lose all your money, you’re likely to start worrying about how the loss could affect your finances. On the other hand, if they said there’s an 80% chance of success, it can sound far more appealing.

Even though both statements convey the same chance of success and failure, they can lead to very different outcomes. You may be more likely to make riskier decisions if it’s communicated to you in a positive way that focuses on potential gains.

4. Sample size neglect

Researching financial options can feel overwhelming, whether you’re looking for the best way to invest or are seeking financial protection, as there’s often a lot to weigh up. One shortcut that could lead to bias is basing your decisions on a small sample size.

If you’re looking for the best account for your savings, you might ask family or friends and follow their advice. However, what’s right for them, might not be suitable for you, and if you researched your own options, you could find that a different account is better suited to your needs.

Alternatively, you might review investments and see that a particular sector has performed well over the last few months, so you decide to move more of your money into this area. Yet, as you’re basing a decision on short-term figures, you could miss out on wider trends and inadvertently increase the financial risk you’re taking.

Sample size neglect may lead to overconfidence in predictions that are based on limited experiences.

5. Loss Aversion

Loss aversion is similar to framing bias as it’s about how you perceive losses and gains.

The theory suggests that you feel losses more keenly than you do gains. So, if your investment portfolio falls by 5%, it would affect your emotions more than if it had increased by 5%.

For some investors, this cognitive bias could lead to them becoming risk-averse and potentially missing out on opportunities, even if they’re appropriate for them. A cautious approach may seem “safe”, but it has the potential to harm your long-term wealth creation and affect your plans.

An outside perspective could help you limit the effects of bias

It can be difficult to recognise when bias might be affecting your decisions. Sometimes an outside perspective could help you identify where past experiences, emotions or cognitive errors are influencing the conclusions you’ve drawn.

As financial planners, we can work with you to create a financial plan that aligns with your goals and circumstances. Please get in touch if you’d like to arrange a meeting.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

This year, World Sleep Day will take place on the 14 March.

The event encourages you to prioritise your sleep and learn more about the incredible biological process that you spend around a third of our life taking part in.

So, if you want to learn more about how and why we rest, read on to discover five interesting insights into the science of sleep.

1. No one knows why we sleep

Scientists used to believe that the brain used sleep to flush out toxins, but new research suggests that the opposite might be true and that exercise may be more effective at helping the brain get rid of damaging molecules.

While we aren’t sure why we sleep, scientists do know how important it is.

Sleep affects almost every type of tissue and system in the body, so a chronic lack of sleep or poor-quality sleep can increase your risk of health problems such as:

Diabetes
Obesity
Depression
High blood pressure
Cardiovascular disease

If you are having trouble sleeping, it is important to make changes to your lifestyle or see a doctor so you can avoid these potential negative effects.

2. You can’t catch up on sleep

Adults should have seven to nine hours of sleep every night.

We’ve all been guilty of sleeping in longer on one day to make up for a night of lost sleep. However, a recent study found that sleeping extra to compensate for lost rest decreased participants’ reaction times and their ability to focus.

It’s better to practice good sleep hygiene by waking up and going to bed at the same time every night, including the weekends. And if you ever wake up tired, try solving it with a nap later in the day rather than a lie-in.

3. Sleep may help your social life

We’ve all avoided a social gathering now and again because we feel tired – but did you know that a lack of sleep can actively harm your social life?

Several sleep studies have concluded that people are less sociable when they’re deprived of rest, as well as less empathetic towards others.

This is because the brain has a network that acts like an alarm system that goes off whenever someone is near us. On no sleep, this system is highly sensitive and encourages us to stay further away from other people.

So, if you often find yourself irritable around others or wanting to stay away, it might be a good idea to consider whether you are getting enough sleep.

4. Your brain consolidates memories as you sleep

Recent research found that two substages of sleep help you to avoid “catastrophic forgetting”, where your brain rewrites or distorts one memory when new ones are created.

While your pupils are contracted during sleep, the brain replays and consolidates new memories, and when your pupils are dilated, it replays older ones.

This groundbreaking research has helped scientists understand how your brain separates new knowledge in a way that doesn’t interfere with the information already in your mind.

5. There are some strange ways to fall asleep

There are many common tips to help you fall asleep at night, such as avoiding caffeine or turning off electronic devices before bed.

But if you are still struggling, there are also some stranger ways to help you drift off.

Curl your toes

Repeatedly curling and uncurling your toes may help you fall asleep.

This simple exercise relaxes your muscles and focuses your concentration on a single part of your body, turning it into an easy meditative action.

Don’t sleep

If anxiety over how long it takes you to fall asleep is keeping you awake, you might benefit from trying not to sleep.

Lying in bed and trying to keep yourself awake all night often paradoxically leads to you unintentionally dozing off without focusing on the anxiety keeping you up.

Get out of bed

Similarly, if you’re struggling to sleep, forcing it won’t help. Sometimes, it’s better to get out of bed and try your hand at a different activity for a while before trying again.

Doing something that relaxes you – such as reading a book or completing a crossword – can help to encourage feelings of tiredness so you can drift off faster when you climb back into bed.

Worry on purpose

It’s important not to ignore the worries keeping you up at night.

Instead of dismissing them altogether, carve out some time to consider your concerns earlier in your day. Spend ten minutes writing down your fears or speaking to a loved one about them so they aren’t plaguing your mind when it’s time to rest.

Exhaust your mind rather than your body

Regular exercise can help you sleep. However, exercising just before bed doesn’t guarantee a good night’s sleep, because your brain is still awake no matter how tired your body is.

Instead, try to tire yourself out mentally by teaching yourself something new, solving a puzzle, or indulging in your favourite hobby.

Concerns around potential trade wars following President Trump’s inauguration weighed on investment markets in January 2025, but there was positive news too. Read on to discover some of the factors that may have affected the performance of your investments.

Keep in mind that short-term market movements are part of investing and taking a long-term view is an important investment strategy for many people.

UK

Headline figures were positive for the UK.

UK inflation fell to 2.5% in the 12 months to December 2024, data from the Office for National Statistics (ONS) shows. According to the Guardian, there’s a 74% chance the Bank of England (BoE) will cut interest rates in February as a result.

The ONS also reported the UK economy returned to growth in November 2024, as GDP increased by 0.1%. While it’s only a small rise, it follows three months of stagnation.

What’s more, the International Monetary Fund expects the UK to grow by 1.6% in 2025 and be the third-strongest G7 economy in terms of growth.

In encouraging news for the chancellor, at the World Economic Forum, PwC revealed that the UK is the second-most attractive country for investment, only falling behind the US. It marks the highest rank for the UK in the 28 years PwC has carried out the survey.

Sharp rises in borrowing led to the UK bond market making headlines.

On 8 January, UK government debt hit its highest level since the 2008 financial crisis, just a day after 30-year bond yields were at the highest level since 1998. Bonds rising could lead to mortgage lenders increasing rates and could affect the value of pensions, particularly those who are nearing retirement and are more likely to hold bonds.

Markets calmed down the following day but continued to experience ups and downs throughout January.

After the turmoil in the bond market, the FTSE 100 – an index of the 100 largest companies listed on the London Stock Exchange – was down 0.9% on 10 January. The biggest faller was financial group Schroders, which saw a dip of 4.3%.

Yet, just weeks later, the FTSE 100 hit a record high and exceeded 8,500 points for the first time on 17 January. The boost of around 1% was linked to speculation that there would be several interest rate cuts this year thanks to falling inflation.

However, many businesses still aren’t confident.

According to the British Chambers of Commerce (BCC), confidence among British businesses fell to the lowest level since former prime minister Liz Truss’s mini-Budget in September 2022. The pessimism was linked to chancellor Rachel Reeves’s £40 billion tax increases, which have placed a large burden on businesses. The BCC survey suggests 55% of firms plan to raise prices as a result.

Similarly, a survey from the BoE suggests more than half of UK firms plan to cut jobs or raise prices in response to employer National Insurance contributions increasing in April 2025.

The effects of the chancellor’s Budget were also evident in S&P Global’s Purchasing Managers’ Index (PMI).

The index fell to an 11-month low in December and into contraction territory. Rob Dobson, director at S&P Global Market Intelligence, noted there were also sharp staffing cuts as some companies acted now to “restructure operations in advance of rises in employer National Insurance and minimum wage levels”.

Europe

Data paints a gloomy picture for the eurozone.

As expected, following an interest rate cut by the European Central Bank to boost the flagging economy, inflation across the eurozone increased. In the 12 months to December 2024, inflation was 2.4%.

Germany – the largest economy in the bloc – reported GDP falling 0.2% in 2024 when compared to the previous year, and it follows a decline of 0.3% in 2023.

According to an index from sentix, the challenges Germany is facing are negatively affecting investor morale across the eurozone. Indeed, investor confidence fell to a one-year low at the start of 2025. Germany is set to hold a snap general election in February, which could ease some of the uncertainty investors are feeling.

PMI figures from the Hamburg Commercial Bank fail to offer investors optimism.

While the eurozone service sector improved, it was still in decline at the end of 2024. In addition, the construction sector continues to contract and new orders fell markedly, suggesting that a recovery isn’t on the horizon.

US

Dominating the headlines in the US in January was the inauguration of Donald Trump, which took place on 20 January. Trump will serve a second term as US president and promised a “golden age” for America in his inaugural address.

In the first days of his presidency, Trump continued to make similar trade threats to those he made during his campaign. He suggested a 10% tariff on Chinese-made goods arriving in the US could be implemented as early as 1 February 2025. Trump also hinted that he was considering levies on imports from the EU, as well as a potential 25% tariff on the US’s two largest trading partners, Mexico and Canada.

According to the US Bureau of Labor Statistics, inflation increased to 2.9% in the 12 months to December 2024, up from 2.7% a month earlier. The inflation data could mean the Federal Reserve is less likely to cut interest rates in the coming months.

Indeed, on 13 January, Wall Street fell when it opened as traders expect interest rates to remain where they are.

Technology-focused index Nasdaq fell 1.3% and the S&P 500, which tracks the 500 largest companies listed on stock exchanges in the US, lost 0.8%. Pharmaceutical firm Moderna experienced the largest slump when share prices fell 24% after the company cut its outlook due to shrinking demand for its Covid-19 vaccine.

Markets faced more turmoil on 27 January. The emergence of a low-cost Chinese AI model, DeepSeek, led to concerns about the sustainability of the US artificial intelligence boom.

According to Bloomberg, shares in US chipmaker Nvidia fell by 17% and erased $589 billion (£473 billion) from the company’s market capitalisation – the biggest in US stock market history.

Other US technology giants saw share prices fall too. Microsoft, Meta Platforms and Alphabet, which is the parent company of Google, saw losses between 2.2% and 3.6%. AI server makers saw even sharper drops, with Dell Technologies and Super Micro Computer sliding by 7.2% and 8.9% respectively.

PMI data from S&P Global indicates business could pick up at the start of 2024. In fact, the service sector posted its biggest growth in output and new orders in December 2024 since May 2022. The jump was linked to firms anticipating more business-friendly policies under the Trump administration.

Asia

Threats of trade tariffs from the US in 2025 meant Chinese manufacturers rushed to fill orders at the end of 2024. Indeed, exports increased by 10.7% in December 2024 when compared to a year earlier, according to official customs data. With exports outpacing imports, China’s trade surplus was just under $1 trillion (£0.8 trillion) in 2024.

China’s National Bureau of Statistics also reported the economy hit its official target of growing by 5% in 2024.

Chinese manufacturer BYD could be on track to overtake US technology giant Tesla this year. BYD revealed it sold 1.76 million battery electric cars in 2024 falling only behind Elon Musk’s company, which sold 1.79 million. In fact, when including hybrid vehicles, BYD surpassed Tesla.

However, the new year didn’t start positively in the Chinese stock market. On 2 January, weak manufacturing data contributed to a sell-off of Chinese stock. The Chinese Stock Exchange fell by 2.7%, and the Chinese yuan also fell to a 14-month low against the US dollar.

Please note:

This blog is for general information only and does not constitute financial advice, which should be based on your individual circumstances. The information is aimed at retail clients only.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

A cashflow model is a valuable tool that lets you understand how the value of your estate and individual assets might change in the future. But, to get the most out of it, you need to look beyond the numbers.

A cashflow model provides a graphical representation of all your assets, such as investments, property and pension, as well as income, expenditures and debt. It forecasts how each of these will change over time.

To start, you’ll need to input information into a cashflow model, such as the value of your assets now, your household spending, or how much you’re contributing to your pension.

To calculate long-term changes, you may need to make certain assumptions too. You might factor in regular wage increases or the projected returns of your pension.

While the outcomes of a cashflow model cannot be guaranteed, it could provide you with a useful overview of your finances and how they might change throughout your lifetime.

With so much data, it’s easy to get bogged down in the numbers. Yet, moving past the figures could help you turn goals into reality and prepare for the unexpected.

Combining a cashflow model with your goals could help form an effective financial plan

A cashflow model provides a snapshot of your finances, and financial planning can help tie this to your goals.

When you think about why you’re saving through a pension, it’s probably the lifestyle you want to enjoy that comes to mind, rather than the figure you need to save.

So, you might think “I want to retire at 60 and maintain my current lifestyle” rather than “I want to save £500,000 in my pension”.

As a result, it’s important to think about what your lifestyle goals are when using a cashflow model if you want to get the most out of it. When you stop working, your outgoings often change, so in this scenario, you might calculate how much you’d need to maintain your current lifestyle.

You can then add this information to the cashflow model and see what would happen if you withdrew this income from your pension from the age of 60 – is there a chance your pension could fall short? Could you retire sooner and still be financially secure?

By combining your goals with a long-term view of your finances, you can work with your financial planner to create an effective financial plan that’s tailored to you.

A cashflow model could identify potential weaknesses in your current financial plan

As well as goals, your cashflow model can be used to help you address concerns you might have about your financial security and events outside of your control.

For example, if your family rely on your income, you might worry about how you’d cope financially if you were unable to work. Updating the information used to create the cashflow model could help you understand the short- and long-term impact.

You might find you have enough saved in an emergency fund to cover six months of expenses before you’d have to use other assets. So, to create an additional safety net, you may take out appropriate financial protection that would begin to pay a regular income after six months.

Taking an extended break from work may affect long-term goals as well. You might halt pension contributions, which could affect your income when you reach retirement, or use savings that had been earmarked for another use.

Much like how a cashflow model could help you understand your goals, it can also be useful when you want to identify risks or weaknesses in your current financial plan.

A cashflow model could help you make informed financial decisions now

One of the benefits of cashflow modelling is that it may identify potential financial gaps that could affect your future. Being aware of these sooner often means you’re in a better position to take steps to bridge the gaps or adjust your plan.

Let’s say you discover there could be a potential shortfall in retirement because you aren’t contributing enough to your pension. If you identify this 20 years before you plan to retire, a small, regular increase to your contributions could be enough to keep you on track without making changes to your retirement plans. However, if you don’t realise until you reach the milestone, you may have fewer options.

Alternatively, if you find you’re in a better financial position than you expected, you might want to adjust your lifestyle now or update long-term plans.

After finding out you’re comfortably on track to have “enough” saved for retirement, you might decide to start building a nest egg for your child to provide a helping hand when they reach adulthood. If you’re confident in your financial future, you might also feel secure enough to increase your disposable income now and start doing more of the things you enjoy.

Contact us to talk about your long-term finances

Please get in touch if you’d like to talk about creating a long-term financial plan that focuses on your aspirations and addresses concerns you might have about the future.

Please note:

This blog is for general information only and does not constitute financial advice, which should be based on your individual circumstances. The information is aimed at retail clients only.

The Financial Conduct Authority does not regulate cashflow planning.