With the Covid-19 pandemic an ongoing issue and the winter months fast approaching, lots of the news is understandably focusing on the Government’s changing guidance on social distancing and the prospect of a further lockdown in a bid to avoid overloading the NHS.

From a financial advice viewpoint, this raises the question of further market volatility and the impact it may have on your investments and pensions. Under current rules, Discretionary Investment Managers are required to notify their client if the market value drops by 10% or more but, following the sizeable market downturn we experienced in March, not to mention the subsequent partial recovery, the Financial Conduct Authority announced it would suspend all enforcement of this rule during these unusual times. Whilst we don’t run discretionary portfolios and therefore are not affected by these rules, I was interested to read that this ‘suspension’ has been extended for a further 6 months and, naturally, that could set alarm bells ringing for some people.

If your investments and pensions have been designed for the longer term, and use a combination of different types of asset so that you don’t have “all your eggs in one basket”, relatively short term trends like this shouldn’t cause any major concerns. In many cases our advice to clients is to simply “sit tight and let things settle down” particularly if they don’t expect to need access to their money in the next few years.  But, if you think you may wish to withdraw some of your investments in the coming months, it’s worth looking at the options sooner rather than later so you can begin putting your plans into action. If you think you may be affected by the prospect of further reductions in the value of your investments, and wish to discuss your options with an independent financial adviser, please contact me or my colleague, Gary Mothersill.