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Friday 5 June 2015
Friday 5 June 2015
Friday 5 June 2015
Friday 5 June 2015
It may feel like a distant memory, but the 1970s and 1980s saw periods of double-digit inflation, peaking at nearly 25% in 1975. During those turbulent years, Britain’s economy struggled with strikes, chaos, and record unemployment, reaching over three million in 1982.
Fast forward to today, and while the aftermath of 2008 brought challenges, we now find ourselves in a deflationary period – a time when prices remain low or fall dramatically. While this may not suit manufacturers or property developers, it’s great news for consumers and those willing to seize the opportunities deflation offers.
Here’s a quick guide to how you can benefit.
1. Remortgage and Reduce Your Mortgage Payments
Financial advisors often recommend reviewing your mortgage deal every three years. If you’re approaching that point, or simply wondering, “How do I reduce my mortgage payments?”, now could be an excellent time to remortgage with a new provider.
Why Remortgage Now?
Interest rates on mortgages are historically low, making deals more affordable than they’ve been for decades.
The mortgage market is currently more buyer-friendly than it has been in years.
Things to Consider:
Fixed-rate or variable-rate deals both offer advantages, depending on your circumstances.
While mortgage lenders now carry out thorough affordability checks, those who qualify can benefit greatly.
If you meet the criteria, you could significantly reduce your monthly payments or lock in a competitive rate for years to come.
2. Investing for Growth: Shares and Dividends
The falling cost of fuel has had a positive ripple effect across several sectors, improving the balance sheets of industries like:
Road haulage
Food manufacturing
Construction
Car manufacturing
Why This Matters for Investors:
Companies with reduced overheads often experience improved profits and dividends, creating attractive opportunities for investment.
Note: While investing in shares during a deflationary period can offer growth potential, remember:
The value of investments can go down as well as up, and you might not get back what you put in.
If you’re considering shares or funds, consult a financial adviser to align your investments with your goals and risk appetite.
3. Making Big Purchases: A Buyer’s Market
When borrowing, fuel, and property costs decline, consumer goods and commodities often follow suit. This can make big-ticket purchases far more affordable than usual.
Opportunities to Consider:
Investing in your home: Renovations, extensions, or repairs can be tackled at a lower cost.
Business essentials: Buy expensive but necessary equipment for your business while prices are competitive.
Second properties: If you’ve considered investing in property, now could be the time to explore options.
You can gauge the competitiveness of the economy by browsing platforms like eBay, Amazon, and Groupon, where bargains often reflect broader price trends.
Spend Strategically
While it’s tempting to splurge on luxuries (that hot tub you’ve always wanted, for example), this period of deflation is better viewed as an opportunity to make smart, long-term purchases that will improve your financial well-being.
4. Seek Impartial Financial Advice
If you’re unsure how best to take advantage of these opportunities, consulting a qualified financial adviser can help you:
Understand your options for remortgaging or investing.
Plan big purchases to align with your long-term financial goals.
Manage your risk effectively, particularly in investments.
Final Thoughts
Periods of deflation offer a unique chance for consumers and investors to benefit from lower costs and greater affordability. Whether you’re remortgaging, investing for growth, or making a strategic big purchase, now is the time to act wisely.
Take advantage of these opportunities to strengthen your financial position – and, as always, consider seeking professional advice to ensure you’re making the most of the current market.
It may feel like a distant memory, but the 1970s and 1980s saw periods of double-digit inflation, peaking at nearly 25% in 1975. During those turbulent years, Britain’s economy struggled with strikes, chaos, and record unemployment, reaching over three million in 1982.
Fast forward to today, and while the aftermath of 2008 brought challenges, we now find ourselves in a deflationary period – a time when prices remain low or fall dramatically. While this may not suit manufacturers or property developers, it’s great news for consumers and those willing to seize the opportunities deflation offers.
Here’s a quick guide to how you can benefit.
1. Remortgage and Reduce Your Mortgage Payments
Financial advisors often recommend reviewing your mortgage deal every three years. If you’re approaching that point, or simply wondering, “How do I reduce my mortgage payments?”, now could be an excellent time to remortgage with a new provider.
Why Remortgage Now?
Interest rates on mortgages are historically low, making deals more affordable than they’ve been for decades.
The mortgage market is currently more buyer-friendly than it has been in years.
Things to Consider:
Fixed-rate or variable-rate deals both offer advantages, depending on your circumstances.
While mortgage lenders now carry out thorough affordability checks, those who qualify can benefit greatly.
If you meet the criteria, you could significantly reduce your monthly payments or lock in a competitive rate for years to come.
2. Investing for Growth: Shares and Dividends
The falling cost of fuel has had a positive ripple effect across several sectors, improving the balance sheets of industries like:
Road haulage
Food manufacturing
Construction
Car manufacturing
Why This Matters for Investors:
Companies with reduced overheads often experience improved profits and dividends, creating attractive opportunities for investment.
Note: While investing in shares during a deflationary period can offer growth potential, remember:
The value of investments can go down as well as up, and you might not get back what you put in.
If you’re considering shares or funds, consult a financial adviser to align your investments with your goals and risk appetite.
3. Making Big Purchases: A Buyer’s Market
When borrowing, fuel, and property costs decline, consumer goods and commodities often follow suit. This can make big-ticket purchases far more affordable than usual.
Opportunities to Consider:
Investing in your home: Renovations, extensions, or repairs can be tackled at a lower cost.
Business essentials: Buy expensive but necessary equipment for your business while prices are competitive.
Second properties: If you’ve considered investing in property, now could be the time to explore options.
You can gauge the competitiveness of the economy by browsing platforms like eBay, Amazon, and Groupon, where bargains often reflect broader price trends.
Spend Strategically
While it’s tempting to splurge on luxuries (that hot tub you’ve always wanted, for example), this period of deflation is better viewed as an opportunity to make smart, long-term purchases that will improve your financial well-being.
4. Seek Impartial Financial Advice
If you’re unsure how best to take advantage of these opportunities, consulting a qualified financial adviser can help you:
Understand your options for remortgaging or investing.
Plan big purchases to align with your long-term financial goals.
Manage your risk effectively, particularly in investments.
Final Thoughts
Periods of deflation offer a unique chance for consumers and investors to benefit from lower costs and greater affordability. Whether you’re remortgaging, investing for growth, or making a strategic big purchase, now is the time to act wisely.
Take advantage of these opportunities to strengthen your financial position – and, as always, consider seeking professional advice to ensure you’re making the most of the current market.
