Belgium – home of: Hercule Poirot, Tin Tin, 2,600 chocolatiers (UK has 80), Charlemagne (founder of the Holy Roman Empire), Magritte, Jean-Claude van Damme, Eddy Merckx (5x winner Tour de France), Gerardus Mercator (think maps) to name but a few – not bad for a country only created in 1830.

For my fourth visit, Thursday 06.59 hrs at St Pancras International and 15 www.brxbondstreet.co.uk members are on the Eurostar to Brussels Midi. A 10 minute taxi ride to Grand Place where a guide has been organised by the Main Tourism Office. We meet at their office in the town hall, which she points out is not quite symmetrical due to the two architects involved hating each other, rather than too much beer.

At Number 10 Grand Place is the newly renovated Belgian Brewers’ Museum with a well chosen web address www.beerparadise.be – entrance €6 with a free beer afterwards where on my visit at the end of the day, it is reassuring to see two policemen having a beer. Tucked round to the side in an alleyway is a brass statue which people touch once for good luck – although we are advised to wash our hands afterwards!  A child’s head just above the main statue is touched if you want a baby, while a little mouse down to the left is if you want to have an affair with someone. Who said Belgians were boring?? Our guide Monica, says we can pop back later if we are feeling a bit shy here but as she is saying this one blonde lady walks past our group, touches the mouse and wanders off with a smile on her face.

5 minutes walk away is the Manneken Pis which has no clothes today and is just as crowded as last year http://www.georgeemsden.co.uk/2008/04/another-fine-kettle-of-fish-youve-got-me-into/

By this time, three have treated themselves to waffles with cream and fresh fruit and it is time to go uptown past what were originally poor areas. Brussels inhabitants are used to living in suburbs and it seems central properties are not very popular for rentals. Belgians do not take themselves too seriously and are proud of their sense of humour as the main heading means “And who will walk the dog?” slightly more imaginative than No Dogs Allowed. Reports of the death of Belgium as a nation after last year’s political crisis, are greatly exagerated and while a few per cent of each of the two main communities would like to see the country split up, the vast majority do not. Top of the hill is the must see http://www.fine-arts-museum.be/ next to a new Magritte Museum opening 2nd June 2009 http://www.musee-magritte-museum.be/

2009 is The Year of the Comic Strip http://www.brusselscomics.com/en/index.cfm where The Smurfs are another Belgian invention. Brussels itself has two large parks with the biggest in the south and next biggest in the north with its Heysel Sports Stadium and Atomium from the 1958 World Fair – both easily reached via metro or bus.

Monica leaves us after > 2 hours in Gallerie de la Reine http://www.ilotsacre.be/images/virtualvisit/galeriedelareine-koninginnegalerij.htm (think Burlington Arcade) just near our restaurant in Rue des Bouchers. Second surprise of the day is lobbyist Julia Harrison of www.fdblueprint.be who has been in Brussels for 20 years. Clients include UK companies wanting to do more business in Europe which brings her back to the UK about twice a month. Strangely in the these troubled times, huge EU grant funds are barely touched but as with any public money, one has to know the procedure to apply.

The UK has 3 ambassadors in Belgium, one to NATO, one to the EU legislature and one to the nation of Belgium itself. Property prices in Belgium are descrcribed as “a gift” as setting up a business is apparently cheaper than setting one up in the UK. All sounds a bit tough on the French where a professional connection told me last year, there has been an exodus of businesses escaping French bureaucracy with agencies to help French businesses set up in the UK at Ashford, the last Eurostar stop before the tunnel.

Strangest item in the day is tax – not what you would expect on a jolly with your friends in a foreign country. A bendy bus with film poster showing French pop star turned actor Johnny Hallyday goes past and Monica informs us that Monsieur Johnny (huge star in France) previously applied for Belgian nationality (like his father) so he could pay less tax while living in Monaco. Brings back memories of a tax wheeze The Belgian Tax Holiday http://www.taxationweb.co.uk/tax-articles/general/is-it-the-end-for-the-belgian-tax-holiday.html whereby UK nationals could avoid Capital Gains Tax by living in Belgium for a while. Belgium has (had?) no Capital Gains Tax, so sell off your assets at a huge profit while living in Belgium, and voila! pay no tax at all. Alas, all killed off a few years ago by our Prime Minister when he was at No 11. Last on this exciting subject is  Julia who points out that the right sort of business structure e.g. representative office, freelance or whatever can save significant amounts of tax. But most important point to remember with business in Brussels is that it all works on relationships – c’est la vie.

Friday night, all’s quiet after a full week. Wife wakes up early Saturday morning with severe difficulty in breathing. Ambulance called and straight to local A&E. Oxygen produces immediate improvement and we are handed over to a new shift. Lots of health questions about allergies etc where the info is already in the hospital files, but A&E does not have access to this. It is quiet apart from a mad woman shouting and after 4 hours we are moved to an intermediate area where it will be decided whether she goes home or stays as an in-patient. Young lady doctor we met at the start of wife’s chemo-therapy in January questions us for > 20 minutes, and we are left on our own. Popping out half an hour later finds her looking at two computer screens and on the phone to a doctor who has written a medical paper which may or may not be relevant to her case (this is Saturday afternoon).

Things have quietened down so there is time to look at e-mails via my mobile. A client who moved to the US four years ago has cancer. She is pleased it has been caught early before it reached the lymph system, but part of the remedy is a single mastectomy. In 2002 she insisted that her husband had Critical Illness Cover at a cost of £100 per month but for reasons of affordability, did not insure herself.

Next e-mail is from my sister-in-law in Germany. My very fit brother (he’s a sports teacher) is in hospital. On Wednesday he feels unwell. Same on Thursday but he has promised to give some material to a colleague & does not want to let her down and prepares to go to work. Wife suggests he stays at home and fortuitously, the colleague calls round and collects the material she needs – there is now no need for him to go to work and to cap it all, he now has difficulty in walking back into the house. Family doctor is called and she is round in 3 minutes with an ambulance called shortly after. Day is spent in ICU and explanation given. A minor abdominal operation a few weeks previously has caused a thrombosis in the leg causing a lung embolism. Had this happened on a long airline flight a few weeks previously to visit family in Latin America or had he gone to work that day, he would have died.

Reminds me of one of Benjamin Franklin’s famous sayings. His best known one is perhaps, In this life nothing is certain save death & taxes but the appropriate one here might be, He that would thrive, should listen to his wife – (sorry guys).

For a change, let me step into the area of non-pension politics where the furore over MPs expenses seems to have turned into political gangrene, with the Prime Minister reluctantly giving our disgraced Speaker the elbow. But a peerage (Lord Gorbals?) plus keeping his £1.3 million pension pot may be the poison left over which will kill off the government. An earlier Prime Ministerial purge in July 1962, gave rise to the famous quip from Jeremy Thorpe (former leader of the Liberal Party) Greater love hath no man than than this, that he give up his friends for his life. http://www.independent.co.uk/opinion/night-of-the-long-knives-a-nasty-purge-which-shocked-even-the-dog-1434493.html For the more secular or those of you who don’t quite get it, the root of this quip is here in the New Testament http://scripturetext.com/john/15-13.htm

One Thursday am finally able to attend Open Coffee http://www.meetup.com/opencoffee/?a=wm1_gn at UCL. First contact Steve tells me about Agile Computing where he & other IT specialists team up on ad hoc basis in a fairly loose network. His experience of the waste he encounters regularly in large organisations prompts me to offload my feelings about the cumbersome CRM system I am familiar with used by half the IFAs in the UK, prompting an interesting comment: The Broken gets fixed, The Bad lasts forever! Second contact is a very bright Chinese lady busy here in the UK as a managment consultant. Nearly as much time is spent travelling round the world as is spent here and we trade backgrounds. She has had two previous business ventures which have failed she says, something few Brits would be brave enough to admit two minutes after meeting someone. Here a business failure is seen as a personal failure whereas in the US for example, the response is likley to be, Tell me about your next one. Most recent was a desktop publishing venture where modern technology could reprint that book you like, have lost or want to give someone as a present, in two minutes. Music from someone’s laptop behind me leads me to a third contact who can produce attractive corporate videos/animations very economically. He is a bit reluctant to go out for funding due to economic condidtions but I am able to point out that shortgage of money is not the main issue with start-ups. He has no business cards, does not contact me so am unable to help.

The Achilles Heel of many new businesses seems to be the business plan. Most innovators or entrepreneurs don’t have one or know how to write one. This is not a criticism, it’s just a different skillset. Business Link http://www.businesslink.gov.uk/bdotg/action/home?domain=www.businesslink.gov.uk&target=http://www.businesslink.gov.uk/&tc=000KW021413519 runs courses on writing them while other people will charge £5-10k for one. If you really are just an ideas person, Micro Funding http://www.microfunding.co.uk/ will happily do all this for you (if they like the idea) but apparently at the cost of 70 per cent of your business.

Back in the mainstream, a client wants to take his pension benefits and the pension figures are very interesting. Client requests figures for 5 and 10 year guarantee periods as the nightmare scenario is to take your pension and die say, one month afterwards resulting in a windfall profit for the insurance company. Fortunately guaranteeing a pension payment in an annuity is cheap and the difference between having a 5 year payment guarantee period and a 10 year one here is only £18 a year.

Based on £100,000 annuity purchase guaranteed for 10 years with a 50 per cent spouse’s pension, annual income available looks like: £5,620 level (no escalation) starting at £2,780 if increasing at RPI, starting at £3,400 if escalating at 3% p.a. and starting at £2,390 with a 5% p.a. escalating income. The latter might look poor value, but the increasing payments catch up the level payments after 15 years whereas the 3% escalating payments only catch up the level payments after 21 years. Small legal point here, the estate of someone who dies during an annuity guarantee period cannot be wound up until the guarantee period has run off.

Interesting week. Phone call Thursday finds me back at my management consultants office where a pension scheme member wants income protection? Something odd here as the employers are more generous than average and Ulrica, my very efficient admin colleague confirms that PHI (Permanent Health Insurance) is included in the employee benefits package – 65% of salary payable after 3 months illness to age 65 so what is really needed here? Being in the West End anyway allows me to meet the client 90 minutes later and find out what he really wants.

First item is mortgage protection where he has a quote from Tesco.com at a very low price. More details are given but this is so cheap it is obviously for decreasing cover which the client confirms. Decreasing cover would be applicable to a repayment mortgage where the loan and the amount of life cover decrease over the mortgage term. Is decreasing cover best here when a move to a larger property maybe on the cards later on?  Further discussion here brings out personal details which will probably not not allow cover at standard rates. Problem with the cheapest insurers is that they will use practically any excuse to increase the premium &/or slap on an exclusion. If you fit the narrow market sector that they are aiming for then fine, but slightly outside these and they ain’t so cheap anymore or even worse you ain’t covered.

Mortgage protection is also required but again the personal circumstances suggest that a trust arrangement would be best so that any (death) claim can be paid out before Grant of Probate. The latter is applied for by an Executor if you have made a will, and an Administrator if you have not. With a life policy in trust, you and a partner for example, own the policy so the claim proceeds do not form part of your estate for Inheritance Tax (IHT) purposes possibly avoiding IHT altogether and usually speeding up payment. My suggestion that we look at the more practical Critical Illness protection too, is well received.

Last but not least from the meeting, client reveals that redundancy cover is the most pressing need. 27 people have been “let go” recently but under something called a Compromise Agreement?? Still awaiting full details here but it suggests that under the agreement, the employees are allowed to walk away from their jobs so they can say they were not pushed?? This type of agreement is new to me but my gut tells me that this will not be an allowable grounds for a redundancy claim where the termination of employment has to be involuntary.

Another example of the dangers of buying direct come from fellow www.brx.bondstreet.co.uk member Mike Nightingale of http://www.greenparkinsurance.co.uk who deals with general insurance. Dealt with the latter in one exam paper early in the nineties and been happy to leave it to others ever since. General Insurance cover is usually via annual contracts and invariably has something in the small print called General Average which is designed to protect the insurer rather than you the insured, against people under-insuring their valuables.

With a small claim this might not be an issue, but in the event of a major loss caused by say, flooding where carpets, flooring perhaps, electrics and all electric/electronic appliances ruined not to mention replastering, redecoration required plus say living with your family in a hotel for 4 months (has happened to one of my clients) could result in a huge claim. First person round will be a loss adjuster who as well as assessing your loss, will also report on what the amount of cover should have been. If you have insured for say, £50,000 contents and loss adjuster thinks you should have insured for £70,000 you will not get full £50,000 if there is a total loss of contents. You will get £35,714 where the calculation is £50,000 (your amount insured) x 50/70. This clause is standard in house contents insurance policies but is it mentioned when you go on-line? As ever, there is a difference between price and value and cheapest can often be terrible value. The fact this oversight or omission was innocent is not the point.

The other disadvantage of annual contracts is that the insurer does not have to renew them! Most memorable case of this was a few years ago in the foot and mouth crisis. On the front page, was the story of an elderly farming couple who had paid their insurance premiums for > 30 years but just as they were about to make a claim, the insurer withdrew from that type of business and they were unable to afford the monster premiums of the few insurers still in that market. Annual contracts are impossible to avoid with most general insurance contracts e.g. home or motor insurance, but easily avoidable if you are looking to provide some income or lump-sum protection for yourself, and usually much better value. The reason Permanent Health Insurance has Permanent in the name is the that the insurer is not allowed to stop offering that type of protection as long as you keep paying the premiums.

End of a busy day finds me at www.schneiderfx.com one of three FSA-registered FX brokers in town where I am reminded for the second time in < a week that 70 per cent of UK banks’ profits currently are from FX business! Schneider and indeed the other FX brokers work on a spread of about two per cent whereas the high street banks we love, work on 4 per cent plus. Anyone buying an overseas property for example, and paying for it via their own bank is chucking a few hundred quid at least out of the window. Schneider’s niche seems to be using market timing – something that is very dangerous for people in the equity markets but seems to work 90 per cent of the time in the FX markets.

If a foreign currency bill needs to be paid, and the counterparty can afford to wait 24 or 48 hours, then the buy or sell trade can be done when the price moves outside the daily average spread, saving the client here some useful cash. London is home to 40 per cent of worldwide FX business and in the window of a few hours when New York is open too, 70 per cent of the world’s FX business is done. Once London closes and Asian markets take over, rates can spike or move much more on thinner trade volumes. Schneider group’s annual business volume is US$75 trillion or US$75,000,000 million and have the largest non-bank dealing room in London. When at school, I had never heard of a trillion but now we read of them practically every week. Bottle of plonk to the first reader to spot the first mention of quadrillion (a thousand trillion) in the financial press – Zimbabwe with its runaway inflation excepted.

Have a good weekend.

Finally, apologies to readers who just got a heading and no text, when trying to read last week’s blog Financial Planning for People with Cancer http://www.georgeemsden.co.uk/2009/05/financial-planning-for-people-with-cancer/ Cause apparently, is compatibility problems as I use Mozilla as my main browser rather than Internet Explorer.

To hear this blog as a podcast, please click on the player. [audio:http://www.green-shoot.com/podcast/georgeemsdenspodcast_financecancer.mp3]

By way of a change, a few thoughts for people who are caught…

You’ve got cancer? 20 years ago people wouldn’t even say the word – it was the BIG C. These days, you can hardly open the newspaper without reading that someone famous has got it. Now it catches more than a quarter of the population, some of your friends, colleagues or family may have had it. And now you are in that group??

Researching this topic, I found lots of non-financial information, support and advice out there but very little financial material for people with cancer or other serious illnesses. This blog will try to plug that gap and involves asking yourself some big questions. First step is to do an audit or rather draw up your own balance sheet or set of accounts.

Any piece of paper will do for now but divide it into four sections.

First two are assets and liabilities – what you’ve got and what you owe.

Second two are income and expenditure – how much you earn and how much you spend

If you have avoided doing this for ages and don’t have a clue, get the information from your bank statements, but do it. This isn’t rocket science. If you take it slowly, step by step it is really quite easy and it helps you know where you stand financially. To be quite frank, if you cannot face doing this I doubt if this article is going to be of much benefit to you. As a last resort, get a friend or family member to help if you cannot face this exercise alone, but it is really important.

Next make a list of places you have worked and note which ones might have offered you a pension – possible if you worked there for > 2 years. Then make a list of insurance, savings or any other life policies you may have had. There are £billons of unclaimed policies out there which are sometimes called Orphan Assets. To make it even more silly, insurance companies are taxed on these. If the insurance or pension company has changed its name or been taken over, the ABI Association of British Insurers http://www.abi.org.uk/Search/default.asp will tell you the latest name or new owner.

If you have shares, make a list. You can get the prices from a newspaper or the internet.

As soon as you can, write to the companies concerned or broker if applicable and get the current value. With pensions, ask who the Nominated Beneficiaries are – the people who will get that pension benefit if you die before taking them. This may need updating especially if you have married or now have children, for example.

For most people in this country, their biggest asset is their home, their biggest debt is their mortgage while the largest pool of money with their name on it is their pension.

Now the biggest question…..How long have you been given or what are your chances?? Will you be able to continue working? Will you be able to travel or drive a car? Will you need care? Who might be able to help you?

If you have > two years, then you might as well carry on as normal for as long as possible. I really do love stories where people confound the medics and carry on for years after they were told they would be dead, but attitude here plays a large part. Having always had an interest in aviation, I have never forgotten the stories of an early aviation pioneer who took up flying in the early twentieth century, as his doctors told him he had < a year to live. He was still going strong years later.

Another interesting story is that of Dilys Gannon who was given 4 months to live at one point   http://www.colonichydrotherapyuk.com/dylis-story.htm  Her reaction upon her diagnosis was to buy a plane ticket! And > 10 years on she is alive, healthy and with a thriving practice of the treatment that helped her.

You can even buy life insurance for yourself on-line which will pay out provided you live for two years.

People with < average life expectancy can get higher annuity rates for their pension so don’t buy any annuities without checking this. A broker can really help you here.

But if you have < two years to live, it is time to think. There is nothing sadder than dying thinking If only  …………..but strangely, a short life expectancy may enable you to achieve one or two of your goals, that you might not have bothered about otherwise.

Take another piece of paper, and write some headings: People, Things, Places. You might want to adapt this with headings like: Family, Colleagues, Hobbies, Sports.

Now the fun part, and yes I mean you ought to be able to get some enjoyment out of this. What have you always wanted to do? Learn to swim properly? Who or where have you always wanted to visit? Do the tango in Argentina? What bands or entertainers do you like but have never seen live? Pretend you have won the Lottery and let your mind run free here and don’t bother about the practicalities. Keep the list handy and a notepad and pencil with you so you can write things down as they pop into your mind.

It does not matter how long the list is or how many items are on it. Once you have done the above exercises you will have:

* A financial picture of you. How Much?

* Your doctors have told how long you have got and what quality of life you can expect for that time. How Long?

* A list of everything you wanted to achieve. What, who or maybe How Many?

Now it is a simple process of rationalising it and seeing what is achievable within your financial resources. Again this is not rocket science. Put the list on the fridge door or carry a copy with you. The human mind is quite capable of rationalising a long list like this and the things that you can do will make themselves known.

Wish I could say the above was my own invention, but my friend and time management guru Mark Forster beat me to it with his AutoFocus System http://www.markforster.net/autofocus-system/ N.B. I had to watch this video three times over a number of days before the penny really dropped.

However, achieving some of the goals will need money, but you may have > you think, which is the real point behind this exercise. The cherries on the cake here can be pensions & life policies.

Critical Illness Benefit is king of the hill here and the lump-sum will be paid after the claim paperwork has been done and checked. The case mentioned in my 30 January 2009 blog http://www.georgeemsden.co.uk/2009/01/a-bolt-from-the-blue-barack-obama/paid out this week i.e. after 3 months

Many life insurance policies have Terminal Illness Benefit. This means that if your life expectancy is < 12 months, they will pay out while you are alive. N.B. This will depend on what answers your GP gives to the insurance company.

Policies which have Waiver of Premium Benefit will be kept in force by the insurance company if you are ill for > 6 months.

You may be able to sell the (life) policy to a specialist broker who will give you a discounted part of the amount insured – something that is common in America.

Pensions can be paid out in cash tax-free where life expectancy is a year or less which can seriously improve the quality of life for the short time left. Whether this happens or not, again will depend on the answers given by your doctor. See previous blog http://www.georgeemsden.co.uk/2009/02/home-is-where-the-heart-is/

The cash can help pay for travel, adapting your home, paying for extra care if you need it, that balloon flight you have always wondered about, visiting family in Australia or far away, see that old school friend or whatever you have wanted to do but somehow were too busy….

Important point here is that the above exercise can make you feel that you are back in control of your life again, at least for while and make your last days more fulfilling and happier than they might have been.

Acknowledgements: Phil Calvert for the original idea http://www.ecademy.com/account.php?id=53930 Mike Southon for helping me develop it http://www.beermat.biz/ Rhidian Jones for adapting the text to podcast style  http://r2m.agi-emerald.co.uk/page/Management_Team and soundman Johnny Mindlin for recording and editing it  http://www.green-shoot.co.uk/