Professional Paraplanner spoke to Victoria Barber, head of Strategic Partnerships at TIME Investments, about the impact of the pandemic on the advice sector, the growing urgency for IHT solutions and how TIME is supporting paraplanners and advisers.
It’s fair to say Covid-19 has disrupted and impacted our lives in unprecedented ways and for many, it has served as stark reminder of the importance of being financially prepared.
“I read a statistic that showed there was a 267% rise in people making Wills during the pandemic, which is truly phenomenal,” says Victoria Barber, head of Strategic Partnerships at TIME Investments.
“One of the massive impacts of Covid is that people have become so much more concerned about their own mortality and it’s one of the first times in a long time that many people’s employment has also been threatened. As a result, we’ve seen people much more inclined to get their finances in order and financial planners I’ve spoken to have said they’ve never been so busy.
“I think we are seeing a really interesting turn for the advice industry,” she adds.
While the pandemic may have accelerated people’s desire to safeguard their finances, the importance of planning for the future is a drum that TIME Investments has been beating since its inception 10 years ago.
Founded in 2011 by Nigel Ashfield, when Alpha Real Capital acquired the property fund management business of Close Brothers Group plc, TIME has built its reputation on delivering tax-efficient investment solutions that seek to provide clients with “peace of mind” for the future.
“Our USP as a business is that we are conservative and considered in our approach. We never try to do anything outlandish or rash, our ethos is caution and patience,” explains Victoria.
The business was originally launched with two long-standing successful offerings – a long income ground rent fund which launched in 1993 and a first-of-its-kind inheritance tax planning service which launched in 1995. Building on this foundation, TIME launched further funds and now offers clients five income funds and three inheritance tax solutions.
Despite volatile markets, TIME has enjoyed steady growth over the last decade, with the group surpassing £4 billion in assets under management this year.
IHT solutions
Victoria joined the company in June 2021 where her role is building relationships with and supporting advisers, service providers, paraplanners and industry bodies. She says she is excited about what the future holds for the advice industry.
“There’s been much talk about the concept of the Great Wealth Transfer between generations, but it’s happening now and there’s never been such a need for estate planning,” says Victoria. “The Baby Boomer generation has benefited hugely from large investment gains and a phenomenal rise in house prices. Those who bought property 30 years ago, particularly in London, could now be finding themselves sat in houses worth more than £1 million.
“It has created a generation of ‘accidental millionaires’ who still have the mindset that they’re not wealthy and may not even be aware that their estate is subject to IHT. In reality, they need to be giving serious consideration to their tax liabilities.”
A nationwide study carried out by TIME revealed that 52% of over-55s do not know what their IHT liability is and nearly a third (31%) have never checked the rules on IHT or how it applies to them personally.
To help clients protect their assets from inheritance tax, TIME specialises in providing inheritance tax solutions using Business Relief, which can allow qualifying shares to be passed on free of IHT after just two years. By opting for this route, clients can avoid gifting large sums of money and are able to retain access to their investment, subject to liquidity. It’s also much quicker than the traditional planning routes which can take up to seven years to be effective, notes Victoria.
TIME’s flagship solution TIME Advance focuses on investing in asset-backed businesses , targeting a net return of between 3% – 4.5% per year.
Victoria says of the solution: “The main aim of the portfolio is to protect assets from inheritance tax through the use of Business Relief; we aim to achieve returns of between 3 and 4.5% per annum which is currently just above inflation. Investors currently have access to a well-diversified range of different sectors, including secured lending, self-storage, forestry and renewable energy.”
Indeed, renewable energy is a big focus for the portfolio, with investments in solar and wind energy as well as biomass and hydro energy.
TIME also provides clients with the option of a second IHT solution, TIME AIM, which invests in a portfolio of AIM-listed companies.
“TIME AIM takes a slightly different approach to traditional portfolios in the market,” Victoria explains. “It’s actively managed but follows a disciplined, data-driven process to select companies. It will typically invest in around 30 companies but a key criterion is that those companies qualify for Business Relief.”
It is an approach that has paid off, with returns of over 50% over the past 12 months, despite volatility in the markets.
In addition, TIME also administers TIME CTC designed for businesses that are concerned the amount of cash they are holding might threaten Business Relief qualification should the owner pass away.
“It was really important for us that we offer a solution that allows business owners to get their money working for them in a more efficient way,” says Victoria.
For Victoria, IHT planning is only set to become more important going forwards, particularly as the Government looks for ways to balance its books in the wake of its vast pandemic spending.
“We’re seeing a lot of rumours around changes to IHT rules and capital gains tax and it’s inevitable that we will see further tax rises in the future,” says Victoria. “From our perspective, if IHT receipts continue to rise there will be an increased need to look at options such as Business Relief investments for clients.
“One thing we are seeing a lot of in discussions with advisers is the need to have the conversation around estate planning much earlier. Whether or not that leads to actions being taken immediately, it’s crucial that advisers understand their client’s long-term goals in their 50s rather than wait until their late 60s/70s.”
Estate planning has also become a more pressing concern given the longer life expectancy that younger generations face.
Victoria says: “Life expectancy continues to increase and more and more people are living to see their 100th birthday. We are likely to see multi-stage lives evolve so there will be a need for more flexible financial planning to cater for these different stages.
“People will think of finances in a different way and having financial planners and paraplanners who understand this change will be really important.”
Supporting paraplanners
“We have one of the largest adviser support teams in the market,” says Victoria. “We have a client service team to help with all post-sales enquiries as well as in-house technical specialists and regionally-based sales people who can travel to advisers’ offices. We also run lots of training online. Our aim is to help advisers and paraplanners.”
Over the Covid period, TIME ran ‘bite size planning’ made up of 30-minute technical sessions per week which attracted over 1,000 attendees. Not surprisingly, Will provisions proved to be one of the most popular.
“It wasn’t product focused at all, it was really about looking at estate planning differently and helping advisers and paraplanners by providing technical advice and it went down really well,” says Victoria.
TIME is also helping advisers and paraplanners meet the needs of a growing cohort of environmentally aware clients with its impact investment report.
Explaining the reasoning behind the report, Victoria says: “Our report, which sits alongside our standard illustration, shows investors the output of their investment, for example if they invested X amount in TIME Advance, how much carbon would that offset? How much renewable energy would be generated? How many lightbulbs would that power? It looks at the positive impact element and breaks it down for clients in a really clear way.
“We felt it was a really nice thing for advisers and paraplanners to look at when considering solutions for their clients, as we’re seeing more and more people concerned about the positive impact credentials of their investment. Being able to demonstrate this impact can offer them clarity and comfort.”
TIME also offers an online IHT calculator which not only considers a client’s liability today but makes assumptions based on future growth including house prices and fluctuations in investments.
And it doesn’t end there. In its bid to make its service as simple and accessible as possible for advisers and paraplanners, TIME is on the cusp of launching a new adviser portal.
Victoria adds: “We are really excited to offer more support to the paraplanning community and this portal will allow so much of our process to be brought online in an easy to navigate way. I think it will be a real game changer.”
Sources:
1 ‘The Year In Wills Report’, Farewill, January 2021
2 ‘Passing on the Pounds: The rise of the UK’s inheritance economy’, Kings Court Trust, February 2017
3 ‘Property millionaires double in a decade’, Savills, June 2017
4 Research conducted by independent market research company Consumer Intelligence among 1,019 UK adults aged 18-plus between February 19th and 22nd 2021
5 TIME Investments, data correct as at 31 August 2021
6 https://www.thetimes.co.uk/article/record-number-of-people-aged-100-and-over-in-britain-96jd9gplp
Important Information
For professional advisers and paraplanners only. Opinions expressed in this interview are the interviewees own and do not necessarily reflect the view of TIME Investments.
This article was first published in the November 2021 issue of Professional Paraplanner.
