Rachel Reeves will deliver her second budget on 26th November 2025, and with speculation mounting regarding the potential changes, it can be hard to cut through the noise and make good decisions about what action to take, and importantly, not to take. 

What is likely to be in the Autumn Budget?

Speculation has been rife about potential changes in a number of areas, so what might these changes look like?

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Pensions

As has been the case in previous years, a reduction in individuals’ tax free cash entitlements is rumoured once again to be in the Autumn 2025 budget.  These rumours have been fuelled by reports that Pensions Minister Torsten Bell, who in 2019 had stated that the tax free lump sum should be limited to £40,000, had been appointed as a key aid for the Chancellor ahead of the budget.  However, while a change is of course possible, it is important to note that:

• When tax free cash has been reduced before (by reductions to the then Lifetime Allowance), protections (such as Fixed Protection 2012, 2014 and 2016) were put in place to ensure individuals who had already built up pension savings were not disadvantaged.
• The current Labour government previously tried to reinstate the Lifetime Allowance, which the previous Conservative government had scrapped.  However, the government abandoned these plans when they realised it was unworkable to exclude Doctors (who had been retiring due to the high tax rates they were subjected to through a combination of the lifetime allowance and the annual allowance) from the Lifetime Allowance tax charge.  Having now finalised legislation around the Lump Sum Allowance, a further change affecting Doctors’ pensions could prove very unpopular.
• Pension legislation notoriously takes months or years to finalise, as was the case with the recent Lump Sum Allowance (LSA) changes and as is currently the case with the legislation which will bring pensions into scope for inheritance tax from April 2027.  This could indicate any reduction may come into force at a given date in future, rather than with immediate effect.

To make a change ‘overnight’ would be administratively difficult for pension providers.

Capital Gains Tax (CGT) 

Despite the administrative issues associated with implementing an overnight change as outlined above, one change that was brought in with immediate effect in last year’s budget was an increase in the main rate of capital gains tax from 10% to 18% for basic rate tax payers and 20% to 24% for higher rate tax payers.  These increases weren’t as substantial as some thought they would be, so there is the possibility of further increases.  However, there are question marks over how much revenue such an increase would actually raise given individuals can simply choose to stop selling their assets.

Inheritance Tax (IHT)

This is the area that saw arguably the biggest changes in the 2024 budget with:

• Pensions brought into scope for inheritance tax purposes from April 2027
• Business Relief and Agricultural Relief limited to £1m per person and 50% of the full rate thereafter
• AIM shares Inheritance Tax Relief limited to 50% of the full rate   

The government may see the estimated £5.5 trillion of wealth that is expected to be passed down from ‘Baby Boomers’ over the next two decades (known as the ‘Great Wealth Transfer’) as a target for additional taxation. This could include a tax on gifting (currently gifting to individuals is unlimited if the donor lives 7 years from the date of the gift) or a reduction in the tax free allowances available on death (for example the removal of the Residence Nil Rate Band – RNRB).  For this reason, those considering making a gift in the not too distant future could consider making the gift before the budget, though only if the implications of this on their overall financial situation are fully understood.   

ISAs 

There are rumours that there will be a reduction to the Cash ISA allowance. However, a cut to the Stocks and Shares ISA allowance is perhaps less likely given Reeves spoke positively about Stocks and Shares ISAs in her Mansion House speech in July.

Salary Sacrifice

This is the ability for employees’ pension contributions to be paid directly into their workplace pensions, reducing both employer and employee national insurance contributions.  Limiting or removing the ability to do this could raise significant revenue for the government without them needing to renege on their manifesto commitment not to increase tax on working people (income tax, national insurance or VAT).

Other rumours 

Other recent rumours include: 

• An increase in tax with a corresponding reduction in National Insurance.  This could in theory raise revenue without raising tax on ‘working people’, with landlords and pensioners instead footing the bill.
• A further freezing of income tax bandings.  Though this is described by many as a stealth tax as it means more and more individuals will move into higher tax bandings over time, these have been frozen since 2021/22 until 2028 and an extension of this freeze to 2029/30 could raise an estimated £7bn p.a.
• A tax on Limited Liability Partnerships (LLPs) favoured by Solicitors, Accountants and Doctors, as such arrangements allow individuals to be self-employed and not subject to employer’s national insurance contributions.
• A windfall tax on banks, though the Chief Executive of Lloyds Banking Group Chalie Nunn argued this would impact banks’ ability to lend.

An increase in gambling taxes, though the Chairman of Betfred Fred Done has stated all its shops on UK high streets could close if the rumoured changes were implemented. 

When does the Autumn budget take effect? 

Though the budget will take place on 26th November 2025, most changes are expecting to come into effect from the next tax year on 6 April 2026 and beyond.

What can you do to protect your wealth?

In an environment where taxes are increasing, it is becoming more and more important to:

Utilise the various tax allowances that are available to you and your family, for example:

• Your ISA allowances
• Your pension contribution allowances
• Your capital gains tax, savings and dividend allowances
• Your personal income tax allowance.

Have a plan in place with diversified sources of income and investments.  This way you can adapt your plan as a result of any changes in the budget.

In summary, it is clear that the state of public finances mean taxes will need to increase in the upcoming budget and Labour’s manifesto commitment not to increase tax on ‘people working’ has led to mounting speculation that changes will be made to a number of different areas. These headlines are usually followed by a quote from a leader within the industry in question stating how the tax increase would be devastating for that industry and how the government should look elsewhere. As Private Eye’s headline from September rightly stated: ‘Raise taxes for other people’, agrees everyone, so some difficult decisions will need to be made.

To consider the potential impact of the budget on your overall financial situation, please get in touch or contact your TPO Adviser. 

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning or tax advice. 

The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). 

The value of your investments (any income derived from them) can go down as well as up, so you could get back less than you invested.  This could also have an impact on the level of pension benefits available.

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation which are subject to change. You should seek advice to understand your options at retirement.

When is the Autumn Budget? 

As we head into the final months of the year, attention is turning towards one of the key economic milestones, the Autumn Budget. Scheduled for 26th November this year, the Budget is an essential part of the financial calendar, not just for policymakers and economists, but for households, businesses and advisers to understand the direction of travel.

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While every Budget matters, the stakes feel especially high this year. The economic outlook remains uncertain, government borrowing costs have rocketed, and a growing number of taxpayers are already feeling the pain from continued frozen allowances and the changes announced in last year's Budget.

So, what exactly is the Autumn Budget for, and why is it such an important event? 

Understanding the Budget’s role 

The Autumn Budget is the government’s main opportunity each year to set out its plans for taxation, public spending and economic strategy. It’s when the Chancellor outlines how the government will raise and allocate money in the year ahead, usually supported by economic forecasts from the Office for Budget Responsibility (OBR).

These forecasts cover everything from inflation and interest rates to borrowing, debt levels, and projected economic growth, all of which shape the decisions being made in the Budget itself.

The Autumn Budget is often accompanied by a Spending Review, which sets departmental budgets for the medium term, though not necessarily every year. In contrast, the Spring Statement, usually delivered in March, tends to be lighter, more of an economic update than a full fiscal event, though it can include policy changes when needed.

In recent years, the Autumn Budget has become the main fiscal moment of the year. The Spring Statement, while still useful, is generally more reflective in tone. Some recent commentary has suggested that the government may be considering a move to just one formal fiscal event per year, but as of now, the current two-event framework remains firmly in place. 

Raising revenue by stealth 

One of the most effective tools for raising revenue in recent times has been the simple decision to freeze tax thresholds and allowances, rather than increase them in line with inflation. This is often referred to as “fiscal drag” or stealth tax.

The concept is straightforward. When income tax thresholds stay fixed, but wages rise, even modestly, more people are pulled into higher tax bands. Likewise, with allowances reduced for capital gains or frozen for inheritance tax, for example, more estates and investments gains become taxable over time.

These quiet changes can bring in billions in additional revenue without altering headline tax rates, and they’ve become a central part of the government’s fiscal approach. The freeze on the personal allowance and higher-rate income tax threshold began in 2021 and is currently extended to at least 2028, with rumours this could be further extended in the coming Budget.  

For financial planning, this makes the Autumn Budget a critical event. It’s not just about new taxes or reliefs being introduced or withdrawn; it’s about understanding how existing policies evolve by, some cases, staying exactly the same.

How will the Autumn Budget affect me?

With the Autumn Budget fast approaching, attention is turning to what the Chancellor might announce this time around.

While nothing is confirmed, early speculation includes: 

• An extension of existing tax band freezes, particularly income tax and inheritance tax thresholds
• Restrictions on pension tax reliefs or changes to contribution limits
• Restrictions on the tax-free cash available from pensions, though it is important to remember when the tax-free lump sum has been reduced before, protections were put in place to ensure individuals who had already built up savings in their pensions were not disadvantaged.
• Property tax reforms, potentially around stamp duty or council tax
• ISA reforms, possible reduction in the Cash ISA allowance 

This is purely speculation at this point so it’s advisable not to make rash decisions before knowing exactly what the outcome will be. However, given the current economic environment, including sluggish growth and high debt interest costs, the government has limited room to manoeuvre, so sadly it’s wise to be prepared. Potentially, if there were financial decisions you were planning to make anyway, that could possibly be impacted by the Budget, now could be the time to make them. 

How we can help 

Whether you're a business owner, investor, retiree or employee, the Autumn Budget can affect you in ways both obvious and subtle. Whether through active policy changes or passive revenue generation via fiscal drag.

We’re following developments closely now and in the run-up to November’s announcement. We’ll be keeping these pages updated with the latest news, including on the day of the Budget with a full run down of all the announcements

In the meantime, if you’re concerned in anyway how the Budget may affect your finances, why not get in touch and see if we can help. 

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

FAQs

Global equities moved higher in September with most major indices making positive returns, with US equities leading the way returning 4% (in sterling terms). This meant it was another strong quarter for risk assets as market enthusiasm around AI gained momentum, trade tensions were eased and we saw the Federal Reserve cut rates for the first time since December 2024. 

Figure 1. Regional equity returns (Source: Pacific Asset Management, September 2025)
 
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US Tech - AI sentiment continues to shine brightly

Much has been made about the AI theme in recent weeks as investors contemplate whether we are entering a golden age of heightened productivity or whether the Nvidia circular economy, in which Nvidia invests or lends money to other companies who in turn use Nvidia Graphics Processing Unit (GPU) may be creating an inflated perception of the demand for AI. 

This creates an innovators dilemma for Corporate America: if they don’t embrace new technology they risk losing their competitive edge…..think Blockbuster video dismissing ‘streaming’ as being too expensive and instead continuing to focus on their bricks and mortar model back in the 2000s.

The fear of being left behind has seen management teams at US technology companies adopt a cavalier approach with Mark Zuckerberg (CEO of Meta) expressing that misspending a couple of hundred of billion in the US would be ‘unfortunate’ but ‘the risk is higher on the other side’. Similar comments have been made by Larry Ellison of Oracle and Sundar Pichai of Alphabet.

The ability to invest billions of dollars in projects with uncertain returns has been made possible only by the exceptional financial strength of leading US technology companies. Simply put, few firms have the scale or resilience to take such risks. In today’s market - where investors are rewarding companies viewed as ‘enablers’ and ‘beneficiaries’ of the emerging AI economy - this dynamic has led to a renewed period of narrow leadership, with a small group of companies driving the majority of returns.

This can be seen in the returns of US Technology companies.  After a challenging start to the year they’ve returned over 30% since April compared to the 14% return of the broader market.  Meanwhile technology companies as a share of the US equity market have more than doubled to 35% from 15% in September 2006. 

Figure 2. Returns of US Mega Cap companies (Source: Pacific Asset Management, September 2025)

Figure 3. US Equity Market: Sector composition (Source: Pacific Asset Management, September 2025)

Are we entering ‘financial bubble’ territory?

This combination of enthusiasm, unprecedented levels of spending and market moves have raised the inevitable question of valuations and whether we are in a ‘financial bubble’. The challenge lies in that bubbles in markets are only known after the fact - one person’s richly valued stock is another’s growth company of the future. 

What is worth noting, however, is that there are several ways to gain exposure to the AI theme beyond simply buying US technology companies. Chinese technology firms, for instance, which trade at significantly lower valuations than their US counterparts, rose 12.6% last month. Meanwhile, sectors such as clean energy - which will form critical infrastructure in an AI-driven world - could also present attractive opportunities for investors.

This challenges the convention that the US is the only game in town as the rally in technology companies outside of the US has supported a broader rally in emerging market equities with strong returns seen in China, Taiwan and South Korea. This combined with a weakening dollar and emerging market economies having lower levels of debt than their western peers - the average debt-to-GDP ratio of Emerging Markets (EM) economies is 75%, while for Developed Markets (DM) economies it is 110% - means the outlook continues to look positive. 

Gold looks polished as safe haven prices soar

Another notable development in markets is the continued rally in gold. While the surge in AI-related stocks might suggest unbridled investor optimism, the historic safe-haven asset has also been on the rise. The price of gold reached $4,000 per troy ounce briefly, as investors sought diversification amid concerns over the fiscal profligacy of Western governments, heightened political instability, and a weaker US dollar. Meanwhile, gold mining companies gained 21% over the same period, benefiting not only from higher gold prices but also from a marked improvement in corporate balance sheets across the sector. 

This highlights the importance of not only being regionally diversified and looking beyond the US but also expanding into asset classes beyond traditional equities and bonds - such as real assets and alternatives. While it’s impossible to know with certainty when a market bubble might form or burst, investors should always prepare prudently and take a diversified approach to managing their investments.
 
If you have any questions or concerns about your investments or your future plans, don’t hesitate to get in touch with your TPO Adviser or contact us centrally through our website.

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This information in this article is correct as at 10/10/2025.

This market update is for general information only, does not constitute individual advice and should not be used to inform financial decisions. Investment returns are not guaranteed, and you may get back less than originally invested; past performance is not a guide to future returns.


 

The terms advice and guidance are often used interchangeably when it comes to financial matters, but in reality, they are very different. And in today’s fast-changing financial landscape, understanding this difference is essential.

Since the introduction of the Pension Freedoms in 2015, individuals have had greater control over how and when they access their defined contribution (DC) pension pots. In response, the government established services to offer free, impartial guidance aiming to help people aged 50+ understand their options and avoid costly mistakes.

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One such service is the MoneyHelper platform, provided by the Money and Pensions Service (MaPS), previously known as Pension Wise. The idea was (and still is) to ensure people receive basic, unbiased information before making decisions about their retirement income.

As UK Pensions Minister Guy Opperman put it, “We will introduce new provisions requiring trustees of occupational pension schemes to nudge members to appropriate guidance when they seek to access their pension through the pension freedoms.”

This “nudge” while helpful, begs the question: is general guidance really enough when you're making decisions about what could be hundreds of thousands of pounds of lifetime savings?

What’s the difference between guidance and advice?

Guidance

Guidance is all about information rather than recommendations that are specifically tailored to your situation. It helps you better understand the options available, but the responsibility to decide and act lies entirely with you.

Government services like MoneyHelper for example, or your pension provider’s website may offer generalised content, online tools, or telephone support to guide you through the basics of pensions, investments, or budgeting.

In fact, anyone, including friends or colleagues, can technically give “guidance”. But remember, they aren’t liable for the outcome, and you're not protected if things go wrong.

What you won’t get from guidance:

• Personalised recommendations
• Product suggestions
• A risk assessment of your circumstances
• A regulated professional who is accountable for their advice

Advice

Advice, by contrast, is personal, specific, and regulated. When you take financial advice, you're working with a qualified and authorised Financial Adviser who assesses your entire financial situation, whether that be your goals, risk tolerance or future plans, then recommends a course of action tailored to you.

You’re also protected. Advisers are regulated by the Financial Conduct Authority (FCA) and must adhere to strict standards. If something goes wrong, you may have access to the Financial Ombudsman Service and Financial Services Compensation Scheme.

What about the cost? And is it worth it?

Guidance is usually free and is offered by government-backed services or your pension/investment provider, for example. It’s a good starting point, especially if you just want to understand your options or educate yourself.

Advice, however, is a paid professional service, and like any other expert service, the cost reflects the time and complexity involved.

There are two main types of advisers:

• Independent Financial Advisers (IFAs), who offer whole-of-market advice across a full range of products and providers. All our advisers at The Private Office are Independent Financial Advisers.
• Restricted Advisers, who are limited in the scope of advice they can give, often tied to a particular provider or product range.

Choosing the right type of adviser can significantly impact your financial outcomes. Independent advice means you're more likely to get the best solution for you rather than for the adviser’s institution. 

The rise and possible risks of AI in financial guidance

A key change in the advice landscape is the increasing use of Artificial Intelligence (AI), particularly Large Language Models (LLMs) like ChatGPT and other advanced systems. 

Using LLMs as a substitute for regulated financial advice carries several risks. To be balanced, however, on one hand, there are benefits, including speed, ease of access and lower (or no) cost. But the pitfalls are real and therefore need to be carefully considered.

Here are some of the potential risks:

1. Inaccuracy & outdated / partial information
   LLMs may rely on data that is not fully up to date, or doesn’t reflect recent regulatory, tax or product changes. They also generate plausible‑sounding but false or misleading information, known as hallucinations, from time to time.
2. Lack of holistic view
   AI tools typically only see what you tell them. They can’t pick up life‑events you haven’t mentioned, emotional preferences, long‑term goals, or unexpected future needs. A human adviser can ask probing follow‑up questions to uncover things you may not have thought to tell them.
3. No regulatory protection
   Advice from AI tools is not regulated in the way financial advice from an FCA‑authorised adviser is. If things go wrong, there is no ombudsman to make claims, no compensation scheme, and no requirement that those giving the advice act in your “best interests.”
4. Overconfidence & misplaced trust
   Because LLMs are good at generating fluent, confident text, people may overestimate their reliability.
5. Potential for financial loss
   Applying generic or inappropriate advice could cost money e.g. picking wrong investment vehicles or mismanaging tax implications.

The value of advice is still stronger than ever 

It can often be a daunting task for individuals to think about their financial futures. Working with a qualified financial adviser can help to alleviate the burden of worry, become better educated on their finances and receive actionable advice on how to improve their situations.

An update to the International Longevity Centre’s research showed the long-term value of advice:

• Advised individuals can be up to 24% better off after a decade compared to those who don’t take advice.
• The benefits are especially strong for those with modest wealth, proving that advice isn't just for the wealthy.
• Those who seek advice regularly (e.g. annually) see even stronger outcomes over time. 

In Summary – Guidance vs Advice

You get what you pay for, and when it comes to your lifetime savings and financial future, that advice could make all the difference.

Start with a free, no-obligation consultation

If you’re thinking about the next stage in your financial journey and want trusted, independent advice, get in touch to arrange your free consultation with a qualified adviser. 

At The Private Office, we offer chartered, independent, whole-of-market advice, recognised as the gold standard in the industry. If you have £100,000 or more in pensions, savings or investments, you can start with a free initial consultation (worth £500) with one of our regulated Financial Advisers.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate tax advice or cashflow modelling.

The prospect of living to 100 is a concept that has evolved from a distant dream into a tangible reality for a growing number of people. While modern medicine and healthier lifestyles have made it possible to live longer, the question of whether our finances can keep pace with our longevity is a critical one. For many, the traditional notion of retirement at 65 followed by a relatively short period of relaxation is a thing of the past. The increasing life expectancy coupled with the complexities of the modern world are prompting us to rethink our financial futures. The challenge is not just to live a long life, but to ensure that it is a comfortable one, free from financial worry.

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The changing landscape of retirement

The traditional retirement we all plan for is undergoing a significant change. The dual factors of increasing life expectancy and the recent rising cost of living have turned the conventional wisdom on its head. Retirement is no longer a fixed point in time but a new phase of life that could span thirty or even forty years. This extended period requires a more robust financial plan than was previously necessary. The era of retiring and simply living off a single fixed income for life is fading, as we all look forward to a longer and in many cases more active retirement. 

Instead, individuals are seeking a diverse stream of incomes from various sources to support a new, longer retirement. This could include a combination of pensions, investments, and even part-time work to supplement savings. The rise of the gig economy and flexible working arrangements has also enabled more people to continue earning a living well into what would have traditionally been considered their retirement years. This shift in mindset is not just about necessity; it is also about a desire to remain active and engaged with society.

What you need to live on

The figures from the Office for National Statistics* reveal that the number of centenarians in England and Wales has reached a record high. This demographic shift has important implications for financial planning. It means that the pension pot we build during our working lives may need to stretch for an additional two decades or more. Consider the difference a single decade can make. Our calculations highlighted that a couple needing an income of £25,000 per year from their pension pot only may need a pension value of around £425,000 for a retirement that lasts 20 years, but that same couple would need an additional £159,000 just to last them until the age of 100. The reality for many is that the state pension alone provides a basic safety net but falls well short of supporting a comfortable lifestyle in retirement. 

As we look at the latest Retirement Living Standards** data from the Pensions and Lifetime Savings Association, or PLSA, it becomes clear that building your own wealth is crucial. For a single person to achieve a minimum standard of living, which covers all their basic needs with some left over for fun, they would require an income of £13,400 a year. To reach a moderate standard, allowing for more financial security and flexibility, the figure rises to £31,700 a year, while a comfortable lifestyle requires an annual income of £43,900. For a two-person household, the figures are £21,600 for a minimum standard, £43,900 for a moderate one, and £60,600 for a comfortable lifestyle. This is a clear reminder that we need to take control of our financial futures and ensure that we are saving enough for the lifestyle we desire in retirement.

The family factor

As financial pressures grow, an increasingly common phenomenon is the 'bank of mum and dad'. While it might seem like a simple way to help a child get onto the property ladder or pay for a grandchild's education, the financial support offered to the younger generation is putting a significant strain on the retirement savings of their parents. Many well-meaning parents are using their own hard-earned pension pots to assist their children and in doing so are affecting their own financial security. 

This act of generosity can inadvertently create a new layer of risk for their own retirement plans. The money that was carefully set aside for their later years is being used for immediate family needs, reducing the total wealth available to them when they stop working. This places even greater importance on having a comprehensive and forward-looking financial plan that accounts for both your own needs and the needs of your family, without compromising your own long-term wellbeing. This intergenerational financial pressure highlights the need for a holistic approach to financial planning, one that considers the entire family's financial health and requirements, not just that of the individual.

Planning for the future

For most people, the idea of living to 100 is intimidating from a financial standpoint. The question of whether you can afford to live that long often feels like a difficult one to answer. This is where the true value of financial planning comes into its own. At its heart, financial planning is not just about numbers; it is about providing peace of mind. A good financial plan will provide a clear and concise visual picture of your financial future, helping you to understand the impact of your decisions on your wealth over time. 

For us at The Private Office, cash flow planning is central to how we work with our clients. We begin by gaining a deep understanding of your current financial situation, including all your sources of income, capital and your expenditures. We use this detailed information to create a dynamic cash flow model that illustrates what your financial future might look like for you under different scenarios. This approach allows us to test your wealth against potential events like a market downturn, higher than expected inflation, a long-term health issue, or unexpected expenses. It also gives us the opportunity to see how your wealth can support you to achieve your life goals such as funding your children’s education, renovating your home, or retiring earlier than planned. By providing this comprehensive visual overview, we can work together to ensure you have the financial freedom to live a long and fulfilling life.

Use our retirement calculator

No one has a crystal ball. But what you do have is a range of tools that can help you understand whether your plans are on track. Our retirement calculator is one of the most useful, especially if you’re hoping to retire at 55.

By inputting your current savings, your target retirement age, and the income you’d like to receive, our retirement calculator can provide an estimate of how long your money might last – and what you’d need to contribute to reach your goal.

Retirement Calculator

A useful tool to get a basic understanding of what your future retirement plans look like is our retirement calculator. From your own personal circumstances , you will be able to forecast an estimate of the pension income you will get when you retire and receive a target retirement income to aim for based on your choices.  

It’s important to remember that these tools are only as accurate as the assumptions they’re based on. Investment growth, inflation, life expectancy and future tax rules are all variables. But using a calculator is an excellent way to create a picture of what your retirement might look like – and how close you are to achieving it. This is not guaranteed and is for illustrative purposes only.

How we can help you

A comprehensive financial plan allows you to make informed decisions about your future with confidence and clarity. Living to 100 may seem like a distant challenge, but with the right financial planning and advice, it is a future you can look forward to. We’re offering anyone with £100,000 or more in savings, pensions or investment a free retirement review, worth £500. Why not get in to speak to one of our team for a free initial consultation.

Sources:

* Office for National Statistics

** Retirement Living Standards

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

A pension is a long-term investment. The value of an investment and the income from it could go down as well as up.  The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

The Financial Conduct Authority (FCA) does not regulate tax advice or cashflow modelling.

Despite emerging headline risks, global equities continued their positive momentum from the summer with equities broadly higher across major global regions.

US: Strong earnings, AI concerns

Starting with US markets, equities were flat in sterling terms (up 2% in US$) as we witnessed renewed investor scepticism over the commercial benefits of AI. Technology stocks suffered as a research paper from Massachusetts Institute of Technology (MIT) showed fewer than 5% of AI pilot programmes were profitable. Even Nvidia, which delivered one of the earnings season’s highlights with 56% year on year revenue growth, saw its share price fall after a data centre revenue miss - a reminder of the lofty expectations currently priced in.

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Despite the relative “disappointment” of Nvidia’s earnings, it was another strong period for US corporates with 81% of companies reporting a positive earnings surprise with companies reporting greater earnings than the markets had been expecting. Furthermore, cyclical sectors - sectors which are sensitive to the health of the US economy improved in Q2 with financials and consumer discretionary sectors reporting higher earnings growth than in Q1. 

In a case of “bad news is good news”, US unemployment rose to 4.2%, but equities found support after Federal Reserve Chair Powell’s Jackson Hole remarks signalled shifting economic risks - leading to a belief that this could justify interest rate cuts. 

Japan: Growth surprise and political change

Japanese equities advanced on news of a trade deal with the US, easing pressure on export focused companies. Positive GDP growth also surprised to the upside, with the economy expanding 0.3% quarter on quarter. Meanwhile President Ishiba is likely to step down as his party, the Liberal Democratic Party, is looking to hold an internal leadership vote which would see him ousted following their loss of a majority in the recent lower house election. Markets have reacted positively to this news with the expectation that his replacement will be more market friendly and look to increase government spending.  

Europe: Gains despite political turmoil 

In Europe, political turmoil in France weighed on local markets, but at an aggregate level, European equities posted gains, building on strong year to date performance. This outperformance is a result of a combination of cheap valuations, increased fiscal stimulus and investors looking beyond the US for opportunities. 


Figure 1. Regional equity returns (Source: Pacific Asset Management, August 2025).

UK Macro Economy and Inflation 

The global economy continues to show resilience, but UK inflation once again surprised to the upside, reaching 3.8% in July versus expectations of 3.7%. Over the past year, UK inflation has more than doubled, while Eurozone inflation has risen more modestly from 1.7% in September 2024 to 2.1% (see Figure 2).


Figure 2. Inflation (Source: Pacific Asset Management, August 2025). 

Drivers of the UK’s higher inflation include rising household costs such as electricity, water and utilities, faster wage growth than in Europe, and the impact of new taxes and regulations. This poses a challenge for the Bank of England, whose 2% inflation target remains a distant target at this time. The employment market is also showing signs of strain, with unemployment climbing to 4.7% - the highest in four years.

Rates, Yields and Fiscal Pressures

In early August, the Bank of England cut rates by 0.25% to 4%, a two year low, but cautioned that further cuts may be less likely than markets expect. Yields moved higher, with the 30 year gilt reaching a 27 year peak. This creates a vicious cycle for the UK government: higher yields raise borrowing costs, adding to the debt burden and pushing yields up further (see Figure 3).

Figure 3. 30yr UK Government Bond yield (Source: Pacific Asset Management, August 2025). 

However, it is worth noting this is not a UK specific issue. Across developed markets, yields are rising as investors question long term government fiscal stability. Political consequences are also emerging in France, Prime Minister François Bayrou lost a confidence vote over a €43.8 billion budget cut aimed at reassuring markets about fiscal discipline. This means France will see its fifth Prime Minister in less than two years, adding to the feeling of political and economic uncertainty.

Attention will soon turn to the UK’s Budget announcement on 26 November, with speculation building over the measures that may be introduced to address fiscal challenges. 

We will, of course, keep you informed as soon as we have more clarity. Until then, I’m reminded of a remark by former President of the European Commission, Jean Claude Juncker: “We all know what to do, but we don’t know how to get re-elected once we have done it.”

If you have any questions or concerns about your investments or your future plans, don’t hesitate to get in touch with your TPO Adviser or contact us centrally through our website.

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This information in this article is correct as at 09/09/2025.

This market update is for general information only, does not constitute individual advice and should not be used to inform financial decisions. Investment returns are not guaranteed, and you may get back less than originally invested; past performance is not a guide to future returns.

Following a strong run in May and June, markets maintained their upward momentum in July, with risk assets once again delivering healthy returns. Equities benefited from a combination of easing global trade tensions, resilient corporate earnings, and greater policy clarity, particularly from the US. While concerns around inflation and government borrowing remain, investors found several reasons to stay positive on the outlook.

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US Policy clarity points the way

One of the key macro developments came from the United States, where the “One Big Beautiful Bill Act” (OBBBA) was passed. The bill outlines front-loaded tax cuts paired with long-term spending reductions, signalling a more expansionary fiscal stance. While the initial market reaction included a sell-off in US Treasuries as investors digested the long-term implications for debt, equities rallied as the bill was seen as reducing short-term political and economic uncertainty. 

Markets also welcomed progress on trade. Although the temporary pause on reciprocal tariffs between the U.S. and China is set to expire in early August, July brought signs of cooperation. Renewed trade dialogues with Japan, Vietnam and the EU supported risk sentiment. 

Equities and Bonds - a positive picture, generally!

Equities continued their upward march. Global developed markets rose by 5% in July (in sterling terms), with U.S. stocks once again leading the way. The S&P 500 reached new highs as nearly 80% of reporting companies exceeded both earnings and revenue expectations for Q2 2025. The so-called "Magnificent 7" tech giants continued to outperform, though strength was also seen in cyclicals and financials. 

UK equities benefited from a rally in energy and materials companies, which continue to trade on low valuations. Notably, both BP and Shell saw gains over the month. At the same time, signs of a revival in the Chinese economy - driven by improving activity and ongoing policy support boosted Chinese equities and supported broader Emerging Market performance.


Figure 1. Regional equity returns (Source: Pacific Asset Management, July 2025). 

While equity markets rallied, bond markets were more mixed. U.S. Treasury yields rose again as investors grappled with an uncertain inflation outlook and reassessed the likelihood of interest rate cuts in light of fresh fiscal stimulus. This debate played out publicly within the Federal Reserve, which elected to keep rates on hold despite two Governors - Bowman and Waller - dissenting and voting for a cut, marking the first dual dissent since 1993 (see Figure 2).


Figure 2. Federal Reserve voting record: Number of dissents (Source: Pacific Asset Management, July 2025). 

European yields also edged higher, while U.K. gilts came under pressure following a hotter-than-expected inflation print, with core CPI rising to 3.7%. In Japan, 10-year government bond yields reached 1.6%, the highest level in years, as markets priced in sticky inflation and growing political uncertainty. 

In contrast to sovereign debt markets, corporate credit held up well in July. Credit spreads tightened modestly, supported by strong earnings, healthy balance sheets, and continued demand for yield. Both investment-grade and high-yield bonds saw steady inflows, highlighting investor confidence in the underlying fundamentals of corporate issuers.

The outlook for the year - steady as she goes!

As we head into the latter part of the year, investor sentiment appears cautiously optimistic. The strong performance of risk assets over recent months has been underpinned by solid earnings, stable economic data, and improving global trade dynamics. However, with equity markets pricing in a relatively positive outlook, the bar for up-side surprises is getting higher. 

Inflation remains a key variable to monitor. While headline inflation has eased significantly across most regions, underlying pressures particularly in labour and services remain persistent in some economies. Central banks continue to walk a careful line, trying to support growth while ensuring inflation expectations remain controlled. Whether this delicate balancing act can continue without unsettling markets is likely to be a central theme in the months ahead.

Fiscal policy will also be an area of ongoing focus. The ‘OBBBA’ and similar initiatives elsewhere reflect a broader willingness among governments to support growth through targeted stimulus. While these measures have helped underpin market confidence in the short term, they also bring questions about long-term debt sustainability. At present, markets appear comfortable with that trade-off, but investors will be watching closely for signs of strain.

For now, financial markets are navigating these conflicting drivers with a sense of cautious confidence. Earnings remain a key support, and global growth, while not without challenges is holding up better than many had feared earlier in the year. 

As always, a diversified approach and close attention to the evolving macro and policy landscape will be key to managing portfolios through what remains a complex and fast-moving environment.

If you have any questions or concerns about your investments or your future plans, don’t hesitate to get in touch with your TPO Adviser or contact us centrally through our website.

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This information in this article is correct as at 08/08/2025.

This market update is for general information only, does not constitute individual advice and should not be used to inform financial decisions. Investment returns are not guaranteed, and you may get back less than originally invested; past performance is not a guide to future returns.

The introduction of VAT on private school fees in January 2025 has marked a significant turning point for families and private schools alike. Already grappling with inflation and rising living costs, parents now face an even steeper financial hurdle to provide their children with an independent education. Schools themselves are also under pressure, contending with squeezed budgets and declining enrolments.

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Since the start of the year, more than 32,000 pupils have left private education in the UK, many moving into the state sector. In the same period, at least 21 private schools have closed their doors permanently due to reduced demand and increasing running costs, this in addition to those who closed pre-empting the increase in taxes, both VAT and employers National Insurance. 

Despite some of the political controversy surrounding the role of fee-paying schools, the fact remains that the parents of over 620,000 children choose an independent school.

Many middle-class families spend decades planning in the cost of a private education to their finances, but despite the perception of some, it remains the case that for many, affording a private education is the result of tough decisions and compromises, often made years before a child ever sets foot in a classroom.

With the cost of living in the UK remaining elevated, many parents will find themselves increasingly stretched in covering Private School fees, which have displayed an average increase of 7.1% from 2024 and some reports suggest this has doubled in 2025. 

Figure 1 - Fee increases since 2000 (like-for-like)*

*Source: ONS, ISC Census, 2023

With school fees in England averaging £18,036 a year for day fees, or £42,300 for boarders, this is the highest level on record.  Looking back to 2013, the average annual cost of sending a child to a Private School with boarding was £27,600. There is also the implicit sums to be paid beyond the headline fees. The cost of lunches across the school year, musical lessons and overseas trips can often mean that real cost is actually far higher. These are averages and generally junior schools cost much less than senior schools; so many parents face a stark choice at age 11 or 13 when costs can increase significantly.

This, coupled with the added strain of paying such fees from income that has often already been taxed at 40 or 45%, means that many who have previously worked hard to privately educate their children may be reconsidering the affordability of doing so. With many families often having more than one child in education at once, this only serves to add to the pressure on the balance sheet of the Bank of Mum and Dad, or Grandma and Grandad.

Unfortunately, school fees cannot be offset against a tax bill, however there may be some measures that can be taken through careful planning and structuring that can help to ease the burden.

Many could be missing a trick with some of the options available for reducing the all-in cost on parents or grandparents to giving their children or grandchildren an independent education:

Paying fees upfront 

Perhaps the simplest option, but with the most significant initial cost. Although less suitable for those concerned with shorter-term affordability, those with sufficient liquid wealth who are willing to take a longer-term view may benefit from paying the cost of their child’s education as a one-off lump sum.

As detailed earlier, private school fees can inflate significantly over the course of an education so there may be merit in locking in a lower cost by paying everything at the outlay. This is something that is offered by many schools.

Some schools will also offer investment schemes, wherein parents or grandparents pay a lump sum in advance which is then invested by the school into low-risk investments. As private schools have charitable status, the returns on the investment will be tax-free. If you were to make the same investments yourself, you could have to pay tax on the growth.

Before considering either of these options you should take advice, paying in advance is in effect making a loan to a business, often a small one and some institutions that have closed their doors offered such options.

Family Investment Companies

Sometimes considered as an alternative to trusts, for those with larger amounts of investable wealth, properly structured they can be excellent planning tools for a family.

Like adults, all children have a personal allowance of £12,570 which can be earned tax free. Similarly, they will also have a dividend allowance of £500 for the 2025/26 tax year.

Given that many school-age children are unlikely to have earnings using up the full extent of their allowances, allocating non-voting shares to children so that these allowances can be utilised can be an effective way to pay fees tax-efficiently, and make use of assets that are already generating capital growth or income for the company.

This can be particularly effective where more than one child is attending a fee-paying school as each child will have their own allowances.

An important point to note is that this option only works where the shares in the company are gifted by grandparents rather than parents. This distinction matters as parents will be taxed on their minor children’s income where they have gifted shares to their children.

The parental rule applies to income and not gains, so in some circumstances funds settled by parents could use a child’s capital gains exemption and then pay the lower rate of CGT, currently 18% for gains in the basic rate tax band, up to £37,700

Family Trust Options 

Trusts are separate legal entities, managed and controlled by trustees for the benefit of the trust’s beneficiaries. Like with companies, beneficiaries of a trust will be taxed on any income in their personal name. Therefore, a grandparent settling funds into a trust structure can be a useful way of reducing an inheritance tax liability, whilst retaining control and paying fees tax-efficiently. If a trust is set up by parents then tax falls back on the parents, so this route is only effective for grandparents, or where funds are earmarked for later in life, when the beneficiaries are adult.

Offshore Bonds

For those already holding, or considering the set-up of an offshore bond, there are also planning options:

Bonds are normally split into multiple policy “segments”, and a grandparent can gift segments to the child who encashes it to pay for school fees in a given year or term.  

The policy segments can be assigned to children when they reach school age via a Bare Trust. As a result (providing that the grandparents have invested wisely and reviewed their investment on a regular basis) the tax on the gain would, in theory, be payable by the children. However, if within their personal tax allowances, it will be tax-free.

How we can help 

As with most complex areas of planning there is a balance to be struck between tax-efficiency, control and flexibility. Whilst the savings can be significant if things are structured correctly, the margin for error is high and can leave you in a worse position than at the outset if the appropriate steps are not taken. There are a number of nuances above that are detailed in this article and it is therefore important to seek professional advice in exploring your options to ensure that you do not fall foul of HMRC rules.

Why not contact us today to speak to one of our experts for a free initial consultation?

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The information contained within this article is for guidance only and does not constitute advice which should be sought before taking any action or inaction. Investment returns are not guaranteed and you may get less than you originally invested.

The Financial Conduct Authority (FCA) does not regulate Trusts.

Retiring at 55 is an appealing prospect. Many people dream of stepping away from work while they’re still active enough to enjoy their newly afforded free time. But while the desire may be common, achieving it is something altogether more complex. Early retirement means giving up years of income and stretching your savings and investments over a longer retirement. For some, this can be done. For others, it may require a more nuanced approach.

So, what does retiring at 55 really take? And how do you know if it’s possible for you?

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How much do you need to retire at 55?

The answer to this depends on not just your retirement savings but also on the lifestyle you want to lead once you’ve stopped working. Recent figures from The Pensions and Lifetime Savings Association looked at average retirement income in a more lifestyle focused manner.  The groups are split into Minimum, Moderate and Comfortable with a single person varying between an income of £13,400 a year for a minimum retirement to £43,900 a year for a comfortable retirement. For a couple these figures varied from £21,600 to £60,600 respectively.

But retiring at 55 has many additional challenges. Unlike those retiring at state pension age, you may need to support yourself entirely from your own savings for at least 12 years or more, depending on when you qualify for the state pension to supplement your savings. The state pension is unlikely to cover all your needs. The full new state pension currently pays around £11,973 a year as of April 2025, provided you’ve paid at least 35 years of qualifying National Insurance contributions. Until then, your private pension, ISAs, savings, or other investments will need to do all the heavy lifting.

Can I afford to retire at 55?

You may already have a decent pension pot and additional investments. You may own your home outright or have other sources of income, such as rental property. But even with a solid base, it’s vital to understand whether your money will last.

One of the common challenges early retirees face is the temptation to draw too much too soon. The earlier you access your pension, the longer it needs to last – and the more vulnerable it becomes to poor investment performance or inflation. If you withdraw too aggressively during a market downturn, you risk depleting your pot much faster than expected. This is known as sequencing risk and you can read more about it here.

There’s also the issue of timing. From 2028, the minimum age for accessing defined contribution pensions will rise from 55 to 57, unless you have any existing pension age protections in place. If you turn 55 after this point, your earliest retirement date may be later than you expect. And if you were planning to use your pension as your main income source, this could impact your strategy.

It's worth considering whether full retirement is even what you really want. Semi-retirement, perhaps reducing your hours, freelancing or consulting, can give you more flexibility.

Use our retirement calculator

No one has a crystal ball. But what you do have is a range of tools that can help you understand whether your plans are on track. Our retirement calculator is one of the most useful, especially if you’re hoping to retire at 55.

By inputting your current savings, your target retirement age, and the income you’d like to receive, our retirement calculator can provide an estimate of how long your money might last – and what you’d need to contribute to reach your goal.

Retirement Calculator

A useful tool to get a basic understanding of what your future retirement plans look like is our retirement calculator. From your own personal circumstances , you will be able to forecast an estimate of the pension income you will get when you retire and receive a target retirement income to aim for based on your choices.  

It’s important to remember that these tools are only as accurate as the assumptions they’re based on. Investment growth, inflation, life expectancy and future tax rules are all variables. But using a calculator is an excellent way to create a picture of what your retirement might look like – and how close you are to achieving it. This is not guaranteed and is for illustrative purposes only.

How to really look into your financial future

While calculators give you a high-level snapshot, cash flow forecasting takes your planning a step further. It is a more personalised approach that helps model your financial future in detail.

A cash flow forecast looks at all aspects of your income, spending and assets, both now and in retirement. It takes into account your savings, pensions, investments, property, and any planned large expenses, like helping children with a house deposit or taking a round-the-world trip.

What makes it powerful is that it’s dynamic. With the help of your financial planner, you can run scenarios to see how your financial position changes if you retire earlier, downsize your home, delay your state pension, or take lump sums from your pension. You can also test the impact of market downturns, inflation spikes, or a longer-than-expected retirement.

This kind of planning gives you greater confidence in your decisions. Rather than relying on rules of thumb, you can understand exactly what is affordable – and what changes might be needed to get there.

At The Private Office, we believe cash flow forecasting is a key part of any long-term financial strategy. It provides a visual projection of your financial life, highlighting when and where gaps might arise and helping you take action early to avoid them.

Pension drawdown or annuity – which is best for early retirees?

If you’re planning to retire at 55, it’s likely you’ll be managing your pension using drawdown rather than buying an annuity. Drawdown allows you to keep your pension invested while taking income as needed. This offers more flexibility, especially for those who expect their income needs to change over time.

However, it also means more responsibility. You’ll need to keep an eye on investment performance, monitor your spending, and ensure your pot lasts. For some, this can be daunting, and this is where advice becomes so valuable.

Annuities, on the other hand, offer peace of mind through guaranteed income for life in exchange for flexible access to a ‘pot of money’. But if you buy one at 55, the rates are generally much lower than if you wait until your 60s or later. For that reason, many early retirees opt to draw down first, possibly considering an annuity later on when the rates become more attractive or even a combination of the two later in life.

Is early retirement realistic for you?

For some people, retiring at 55 is entirely realistic. For others, it might require adjustments to spending, saving more in the years ahead, or even considering part-time work to bridge the gap.

What’s most important is having a plan. That plan should be based on careful analysis, not guesswork. It should be flexible enough to adjust when life changes. And it should take account of your goals and values, not just the numbers.

Seeking financial advice can play a critical role here. We can help you define your goals, assess your current position and build a strategy that puts you on the right path, whether that means retiring at 55, or simply retiring with confidence, whenever the time is right for you.

We’re currently offering those with £100,000 or more in cash, investments or defined contribution pensions a free cash flow forecast review worth £500. For more information why not get in touch.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate cash flow planning or tax advice. 

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can down as well as up which would have an impact on the level of pension benefits available.  

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation which are subject to change. You should seek advice to understand your options at retirement.

Quarter 2 2025 Reflecting on ‘interesting times’! 

Q2 (April - June 2025) was another eventful quarter for investors, marked by shifting trade policies and heightened geopolitical risks in the Middle East. Despite this, markets remained resilient as the worst-case scenarios, failed to materialise.

The announcement of the US-China trade deal on June 11, giving the US access to China’s rare earth minerals, helped ease investor uncertainty. The deal also reduced tariffs on Chinese goods from 146% to 30% and this was subsequently followed by a separate agreement with Vietnam. While the initial tariff on Vietnamese goods stood at 46% on “Liberation Day”, it was later reduced to 20% for direct imports, and 40% for trans-shipped Chinese goods. This marked a significant step in the US’s effort to prevent tariff ‘avoidance’ via Vietnam.

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In the Middle East, tensions escalated between Israel and Iran after Israel launched an airstrike on Iranian nuclear facilities. Oil prices briefly spiked above $80 per barrel, reflecting fears of supply disruption through the Strait of Hormuz, which carries nearly 20% of global oil shipments. The subsequent involvement from the US risked a further fall-out, however, despite Iran launching (a well telegraphed) airstrike on US facilities in Qatar, a truce was ultimately agreed, and the price of oil fell back to below $70 dollar a barrel.

In equity markets, we saw the positive momentum from May continue with most major markets advancing last month (see Figure 1).


Figure 1. Regional market returns (in GBP terms) (Source: FE Analytics, July 2025)

Once again, the S&P 500 had a strong month, delivering a return of 3.2% (in GBP terms). Investors looked beyond the uptick in inflation - its first rise in four months - and the contraction in U.S. GDP, instead focusing on easing geopolitical tensions, an improved trade outlook, and stronger-than-expected corporate earnings.

Gains were broad-based across most sectors with technology stocks once again performing well, climbing more than 7% over the past month.

What a first half! – the key points of 2025 so far

June marked the end of a remarkable first half of the year - not only for U.S. technology companies, which rebounded strongly with a 14% gain in Q2 after falling 15% in Q1- but also for the broader S&P 500. The index staged one of the fastest recoveries in recent history. After declining 20%, it took just 57 days to recover from the falls - making it the quickest rebound since the 1950s. For context, the average recovery time from a similar decline has historically been 511 days (see Figure 2).


Figure 2. S&P 500: Days to recover from a 20% drawdown (Source: Norgate Data, Pacific Asset Management, July 2025) 

Beyond the U.S., Euro Area GDP grew by 0.6% quarter-on-quarter in Q1, following a 0.3% increase in Q4 2024. This marks the fastest pace of expansion since Q2 2022. In response to moderating inflation - now at 2% - the European Central Bank (ECB) delivered another 25-basis point rate cut, lowering its benchmark rate to 2%. This was the ECB’s eighth rate cut over the past 12 months. The combination of accelerating growth, declining inflation, easing monetary policy, and ongoing fiscal support has helped drive European equities to a return of nearly 14% in 2025 year-to-date.

In the UK, the Bank of England voted 6–3 to maintain interest rates at 4.25%. However, with signs of labour market stress and slowing economic momentum - as evidenced by a 0.3% contraction in GDP in April - markets are now pricing in two additional 25 basis point cuts before year-end.

Despite ongoing economic and fiscal challenges, the FTSE 100 reached an all-time high last month. Investors looked beyond domestic headwinds, turning to UK equities as an alternative to U.S. markets. The index was further boosted by strong gains in major oil companies such as BP and Shell, which rallied in the immediate aftermath of the Israel–Iran conflict, as rising geopolitical tensions pushed oil prices higher.

Is US ‘exceptionalism’ back?

The recent rally in U.S. equities has led some to suggest that the much quoted "U.S. exceptionalism" is back. While we agree that the outlook has improved - not only for the U.S., but for the global economy - we believe the bigger story lies in the broader structural shifts underway. In a previous update, we discussed how President Trump’s perspective on the U.S.’s global role could mark a watershed moment. His re-election and subsequent policy direction may serve as a pivotal catalyst for change in global territories beyond U.S. borders.

Consider Europe as an example. At the start of the year, both France and Germany were facing political uncertainty, neither with a stable incumbent government. A previous lack of fiscal investment had contributed to low growth across the Euro area. Fast forward to today, and the landscape has shifted significantly: Germany is now planning to deploy €1 trillion in spending, support for the European Union has surged - driven by a "rally around the flag" effect - and European policymakers are signalling a strong intent to step up and fill the leadership void left by a possibly more isolationist U.S.

Time will tell how this transformation plays out, however, it's already clear that President Trump’s return has acted as a catalyst for much-needed strategic realignment in Europe. 

Looking to the future?

Looking ahead, we do not expect U.S. exceptionalism to persist in the same way it has over the past decade. That said, this is not a call to “sell the U.S.” The United States remains home to some of the most innovative, and resilient companies in the world, underpinned by a deeply entrenched capitalist ethos that is unlikely to fade. However, opportunities outside the U.S. have grown meaningfully - particularly among companies trading at more attractive valuations and better positioned to benefit from a world in which the U.S. becomes more domestically focused.
 
In this environment, diversification remains essential - not only as a tool for managing risk in a rapidly evolving world, but also as a means to take advantage of emerging opportunities across global markets.

As ever, if you have any questions about our commentary or would like to discuss your own portfolio in more detail, get in touch with your Adviser or contact us centrally through our website.

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This information in this article is correct as at 11/07/2025.

This market update is for general information only, does not constitute individual advice and should not be used to inform financial decisions. Investment returns are not guaranteed, and you may get back less than originally invested; past performance is not a guide to future returns.