YOU CAN’T PREDICT THE FUTURE BUT YOU CAN PLAN FOR IT

Protecting your income protects a lot more

WHAT IS INCOME PROTECTION?

Your income is probably your most important asset. It funds your whole lifestyle from what’s in your fridge to where you go on holidays. Your children depend on it from birth, right through to college and often beyond.

WHY DO YOU NEED IT?

An Income Protection plan pays you a monthly income if you are unable to work due to any illness, accident or injury. You can ensure you continue to meet your monthly mortgage repayments and household bills and maintain your current standard of living. It will continue to pay you an income until you are well enough to return to work, or if not, until your retirement age.

Income Protection can protect up to 75% of your earned income up to age 65.

The cost of the cover will never increase during the term of your plan (unless you chose to index it or apply to increase your cover)

ASK YOURSELF

• What would happen if your income suddenly stopped because of ill health?
• How long would your employer pay you if you were on prolonged sick leave?
• How would you and your family cope financially after that?

DID YOU KNOW?

Many employers don’t provide any form of sick pay and of those that do, many will only pay you for six months.

If you are self-employed you are not entitled to the State Illness Benefit if you are unable to work due to illness.

AFFORDABLE COVER

Income Protection is more competitive than you may think – the younger you start the less it will cost. And remember your premiums should be eligible for tax relief at your marginal rate of tax.

If you would like to talk about this or need any other financial advice, please call Michael on

086 8440541 or email info@mkfinancial.ie  to arrange an appointment.

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland

Don’t forget - 31st October Tax Deadline!

An Opportunity to Reduce your 2015 Income Tax Bill

Individuals who both pay and file their tax returns through the Revenue On-line Service (ROS) have until Thursday 10th November 2016 to pay a pension contribution and elect to backdate the income tax relief against the 2015 tax year. Those who do not qualify for the ROS extension must do this by 31st October 2016.

How Much Can You Contribute to a Personal Pension, PRSA, PRSA AVC or AVC?

For contributions paid in 2016 and set against 2015 earnings, an earnings cap of €115,000 applies for tax relief purposes to total contributions to PRSAs, Personal Pensions and Employee / AVC contributions to Occupational Pension schemes.

Who Can Contribute?

·         The self-employed,

·         Proprietary Directors (those who own more than 15% of a company)

·         People with non-PAYE income

·         Employees

·         Directors

If you are already in an Occupational Pension Scheme you can also reduce your 2015 tax bill by making an AVC single premium on or before 31st October 2016.

Who can claim Income Tax Relief on AVCs or PRSA AVCs?

Income tax relief on AVCs or PRSA AVCs can be claimed by individuals who are:

·         Employees (Schedule E, PAYE and a member of a company pension scheme)

·         Directors of companies (Schedule E, PAYE and a member of a company pension scheme)

Examples of Schedule E income would include salary, bonuses and benefit-in-kind (BIK).

Where a client has changed employment this may affect their ability to make a pension contribution and backdate the tax relief to the previous year. Once a client leaves an employment where they were a member of a company pension scheme, they cannot make any further pension contributions in respect of the earnings from that employment.

Note: a termination payment made on leaving employment is not considered remuneration for pension purposes. This would include termination payments on redundancy, payment in lieu of notice and other ex-gratia payments. However, part or all of such a termination payment may qualify for tax relief under other available exemptions.

To check if you’re eligible to reduce your tax or receive a rebate for 2015, while helping to fund your pension, contact Michael on 086 8440541 or email info@mkfinancial.ie

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland

Hot Topic #26 Negative Interest Rates – Where to now?

Central banks in Denmark, Sweden, Switzerland and Japan along with the ECB have adopted negative interest rates in a bid to further stimulate lending and boost economic growth. It is debatable as to how effective negative rates are in achieving these aims but central bankers have been credited with helping the world economy recover from the financial crisis and they continue to experiment with unconventional methods.

Negative rates are a drag on the retail banks' profitability as excess reserves put on deposit with the ECB attract a negative rate of 0.4%. The central banks want retail banks to lend this money instead of putting it on deposit with them. Retail banks argue that there isn't the demand.

The banks have, so far, resisted passing negative rates along to retail customers but there are signs that this could be changing: RBS recently sent letters to business customers highlighting a change to its terms & conditions and the possibility of negative deposit rates. A German co-op savings bank will pass on the 0.4% negative charge on deposits over €100,000 from September onwards. Bank of Ireland is to charge corporate and institutional customers on deposits of €10m or more while German insurer Munich Re is reported to have stored in excess of €10m in a vault as a way of avoiding negative rates.

One major problem the banks have with passing negative rates along to the general public is that they would likely see massive withdrawals as customers take their cash out of the banks rather than accept a negative rate. This is clearly easier for customers with smaller levels of savings than corporate customers with millions on deposit (where would Apple Inc. store its $200 billion cash pile?). This would create new problems for the banking system, not to mention the spike in crime that would accompany it.

One possible solution has been proposed: a cashless society. If cash was confined to the history books and all transactions involved a digital transfer through one method or another (plastic cards, phones, apps, etc) financial institutions could impose negative rates on customers and we wouldn't have much choice but to accept it (barter could make a comeback). It is unlikely to happen in the near future but we are heading towards a cashless society and all the pros and cons that go with that.

Most of us do not have to worry about negative interest rates for the moment but, if you have large cash deposits, you should consider diversifying across other asset classes.

Source:  David Coffey - Senior Portfolio Manager, Cantor Fitzgerald

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland

Hot topic #24: It’s time to plan for the longest holiday of your life

Your retirement could last a long time – 20 years would not be exceptional. This is the time that you have worked hard for. Time you owe yourself. Time to spend doing all those things you have always promised yourself.

Without the stresses of having to earn a living, your time will probably be spent travelling. Visiting family or friends in other parts of the world – or visiting places that you’ve always wanted to see. Some of your time perhaps will be spent on hobbies, enjoying existing ones and even picking up new ones. And of course spending quality time with your partner, family and friends. But there’s no such thing as a free holiday. Everything has to be paid for. So will you have enough money to enjoy your retirement to the full? It’s time to plan for the longest holiday of your life Mind the Gap Or will you be faced with a gap in your funds?

As we come into what is the height of the pension season it may be worthwhile reviewing you retirement planning. This is important for everyone whether you are a PAYE worker, Self Employed or a company director.

• PAYE workers are allowed by revenue to make a contribution to an approved retirement scheme before the 31 October 2016 and offset that against tax that was paid in 2015 which may result in a refund from 2015.

• Self-employed can make a contribution before 31 October 2016 and offset this against their final tax bill for 2015 helping them to fund for retirement and also reducing their tax liability.

Company Directors can make a contribution before 31 October 2016 and offset this against their personal liability for 2015.

If you would like to know more ... call Michael on 086 8440541 or email info@mkfinancial.ie for further information.

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland

Hot topic #23: Forget about the Olympics – the big news item this week is the CAO offers

Forget about the Olympics – the big news item this week is the CAO offers …

Have you a child starting school next week or returning to Primary education? 

Everyone wants to give their children a good start in life, and in today’s competitive environment, a degree or professional qualification can be the key to a rewarding career. 

Now is the time to start planning for their 3^rd level education.

But don’t delay! You should start building this educational fund as soon as possible. This will spread the cost over the longest possible period – and give you the maximum opportunity to benefit from potential investment growth. These factors will reduce the amount you need to set aside each year – and might make it more affordable.      

There are three main ways in which you can pre-fund the cost of education – and the most appropriate one for you will depend on your personal circumstances, and how soon the fees will be required:

·       • A capital sum can be invested now

·       •  Regular savings can be set aside out of income and invested

·      •  A combination of a capital sum and regular savings can be arranged.     

The monthly costs incurred by the average student in 2015/2016 were estimated to be: 

    

	Cost of living at home	Cost of living away from home
Rent	N/A	€372	*
Utilities	€33	€33
Parental Subsidy	N/A	€168
Student Contribution Charge	€306	€306
Subsistence - Food & Travel	€184	€291
Books & Class Materials	€33	€74
Personal - Clothing, Toiletries	€77	€77
Social/Miscellaneous	€132	€132
Total	€765	€1,453
Source: Dublin Institute of Technology, 2016. Please note that these are MONTHLY costs		*€372 figure is mean of single room rent in Dublin

Need help with planning ahead ... call Michael on 086 8440541 or email info@mkfinancial.ie for further information.

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland

                  

Hot Topic #22 - Illness or an injury … a second opinion?

Diagnosed with an illness or suffer an injury … would you like a second opinion?

Being diagnosed with a serious illness would be an emotionally overwhelming experience if it happened to you.  You would have lots of questions … What will happen now?  Is the diagnosis correct?  Will the treatment be right?  How can I be sure?  Now, there is someone to help you answer these difficult questions.  The result could save your life.  If you or a loved one were diagnosed with serious illness, Best Doctors - Second Medical Opinion can help.

What is Best Doctors - Second Medical Opinion and how can their service help?

• Best Doctors - Second Medical Opinion is a global organisation which brings the world’s leading medical expertise to you and your family offering a second opinion when you need it most.
• Best Doctors - Second Medical Opinion has a unique and well-renowned network of medical professionals.  Having such expertise at their fingertips and supported by a truly caring service team, is the reason why thousands of people around the world turn to Best Doctors - Second Medical Opinion when they need it most.
• Best Doctors - Second Medical Opinion can help you with those questions that are likely to be racing around your mind if you were diagnosed with a serious illness.

An in-depth review of your medical files will be conducted by a Best Doctors medical specialist to help verify your diagnosis and treatment options.  The process can reduce potentially serious complications that can result from a misdiagnosis, and help you and your treating doctor determine the proper course of action.

But Best Doctors - Second Medical Opinion isn’t just for serious life threatening illness.  You can use the service for any chronic or troubling ailments affecting quality of life.

Here are just some of the conditions for which people rely on Best Doctors - Second Medical Opinion expertise:

                > Sports Injuries                                               > Musculoskeletal conditions

                > Skin Diseases                                                 > Cancer

                > Blood Diseases                                              > Circulatory system conditions

Best Doctors - Second Medical Opinion is available to -

• You
• Your spouse / partner
• Your children up to the age of 18 (or 23 if in full time education).
• Your parents and your spouse’s / partner’s parents

Contact Michael on 086 8440541 or email info@mkfinancial.ie to find out more.

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland.

Hot Topic #21 - Update 2nd August

More than half of Irish workers rely solely on the State pension

47% of the Irish workforce will only receive a state pension worth €230 per week when they retire, according to the Pensions Authority.

The figures emerge as Minister for Social Protection Leo Varadkar launched a consultation process to assess what reforms are required to streamline the existing complex pension system, and introduce a new universal scheme to provide wider pension coverage.

All workers who pay sufficient PRSI contributions are entitled to the state pension of €230 per week.

Out of the 1.9 million in the workforce, a massive 893,000 (47%) will only have that amount to live on in retirement - and face poverty in old age -  as they have made no provision for a supplementary pension.

A further 730,000 are in occupational schemes where both they and their employer make a contribution.

152,000 are funding a supplementary pension scheme on their own, with no employer contribution.

This means that over 1 million employees - a majority of the workforce - are receiving no pension contribution from their employers over and above PRSI.

Leo Varadkar voiced concern that with a growing older population as people live longer, the pension system will be under considerable strain.

The consultation process will focus first on administrative simplification of the pensions system, including issues like management charges, which can eat into benefits, and the qualifications for pension trustees. The Government is also anxious to introduce a universal supplementary workplace retirement scheme into which workers would probably be automatically enrolled - but would have the right to opt out.

The consultation process will consider a number of options, and Mr Varadkar said he was anxious to build a consensus approach.

However, he noted that introducing a new universal scheme could take ten years.

Observers on both employer and union sides acknowledge that reform is essential.

Do you want to be part of the 47% who will have to survive on €230 per week?

Now is a good time to review your Retirement Planning!

Tax Relief is available on contributions.                     

Have you already an arrangement in place that may need reviewing?

You may already have a personal Paid Up pension, or you may be a member of a company scheme of a former employer which you haven’t looked at for years.

This is your money so it is worthwhile to get advice on how best to utilise it for yourself.

You can contact Michael on 086 8440541 or email info@mkfinancial.ie  for a free consultation on how best to proceed.

Michael Keville T/A MK Financial is regulated by the Central Bank of Ireland