With interest rates continuing to increase, is it better to keep my money in cash rather than investing it in the market?

Due to high levels of inflation, the Bank of England have continued to increase interest rates, with the current base rate (the rate which determines borrowing and lending costs) at 5 per cent. This has led many to question the merits of investing their money versus putting it in a savings account or fixed-rate deposit.

Individual circumstances will be different, and for a short period, savings rates offer a good home for cash. However, we know from history that deposit rates tend to underperform inflation, leading to an erosion in the real value of your savings. As such, for longer time periods, investing your money offers the opportunity to grow your savings in real terms.

With the possibility of a change of government at the end of next year, what can I do to protect my wealth against the risk of higher taxes?

Proposed taxes in an election manifesto may never become law, so attempting to shelter wealth without knowing the specifics of how the tax regime applies to you might not provide the protection you want. Good financial plans are based on known facts, so there is a clear understanding of how the plan meets your objectives.

This is not to say you should ignore risks of changing legislation, and you should diversify how you hold your wealth. Make use of all the relevant tax efficient vehicles, such as ISAs, to ensure your financial plan supports your current objectives and can adapt to changing circumstances.

Great British Life: Rachel Wyatt, Chartered Wealth PlannerRachel Wyatt, Chartered Wealth Planner (Image: Arbuthnot Latham)

How can I best make provisions for my family?

The best way to plan for your loved ones is to consider both the best and worst-case scenarios, and then break this down into short-term and long-term goals.

If you have financial dependents, make sure there are sufficient financial resources available in the event of your death, or if you are unable to work. In both instances, you can take out insurance to pay a lump sum or regular income to assist your family pay down debt and/or replace lost earnings.

You should also make sure you have an up-to-date will, meaning you determine how you want your estate to be distributed after your death. This will protect your partner if you are not married and, if you have a young family, will include appointing a guardian to look after your children.

Arbuthnot Latham provides a comprehensive approach to private banking, commercial banking and wealth management with its four core services; Private Banking; Commercial Banking; Wealth Planning and Investment Management.   

We are here to help you go further. Speak to a member of our team today:


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All images were taken at The Farm Club, a health, wellbeing, and lifestyle space, located in the heart of 300 acres of Cheshire countryside within Mere View Estate, Knutsford.