With the second week of 2011 upon us, you might have had a fair dose of top financial planning resolutions, fitness diets and monthly goals. Navigating through the amount of financial planning advice out there can be a daunting task at this time of the year. With the end of the tax year less than three months away, there is also the added pressure of sifting through the multiple government reforms and recognising the ones which may impact your personal income and portfolio bottom line.
To help you order your financial planning priorities and stay on top of upcoming tax and pension policy changes, we turned to four experienced financial planners:
Yvonne Goodwin founder of Yvonne Goodwin Wealth Management 
Dennis Hall founder of Yellowtail 
Alex Riley director in Bunker Riley 
Peter Sudlow, principal of Sapienter Wealth Management 
This is the third question we posed to the four advisers this week. Catch up on their views on top priorities for financial planning in 2011 and whether or not the time is right for portfolio rebalancing, given the recent strong performance in equity markets.
Question: Given various government reforms coming up which changes did they think investors should be most aware or weary of and how can they prepare to accommodate them?
Governments cannot stop tinkering with our tax system or the savings and investment schemes that work around it, comments Dennis Hall. But the average investor will be largely unaffected by reform from an investment perspective due to the fact that most investors will not exceed the limits set on particular investments, takes the view Alex Riley.
Know How Policy Change Affects You
It is therefore essential to know what the upcoming government changes are and whether or not you fall within the bracket of the affected. Annual pension plan contributions, for example, will be tax exempt up to £50,000 in the fiscal year 2011/2012 instead of £255,000 as it has been in the 2010/2011 tax year. Dennis Hall reminds investors that although the pension changes will take effect on 6th April 2011, there are some pension schemes that have their scheme year running from January to January, and therefore pension changes may affect some investors sooner. In addition, capital gains in excess of £10,100 (£20,200 combined for couples) will be taxed at a new rate after this April. On a brighter note, the ISA allowance, currently £10,200 is due to rise to £10,680 in the next tax year.
Keep Up with Policy Changes
You can make sure policy changes do not take you by surprise by using a budget card/update from accountancy firms, which tend to make good lists of the main points, suggest Peter Sudlow. And of course, as Yvonne Goodwin points out, a meeting with a trusted adviser should cover policy matters at least annually.
If you find your earnings or investments outside of the limits stipulated above, says Riley, then regular planning is the key as many investors do not realise that utilising spousal exemptions, or placing assets in the hands of the lesser taxed spouse, or making use of unused ISA allowances via ‘bed & ISA’ of existing assets are all viable planning exercises.
And while the future of Pension and ISA savings seems reasonably clear for now, Hall points out, the bigger question will be "what is the future for Venture Capital Trusts and Enterprise Investment Schemes?" These are currently under review and investors who use these vehicles should not wait until the last minute to make their investments and claim their tax relief.
Keep it Simple
On a final note, Riley advocates keeping it simple as HMRC is getting tough on the niche specialist tax schemes and getting out of one of them could cause a significant headache.
