Town Close Financial Planning (TCFP) Investment Update

We are pleased to announce an important evolution in our investment approach. Towards the end of this year the plan is to move away from our current model portfolio system and into two dedicated funds: Market Growth and Market Defensive, that TCFP directly manages.

This change will allow us to manage your investments effectively, improve portfolio responsiveness, and optimise costs.

Since we started in 2014, we’ve always looked for ways to improve our service to you and your outcomes, for example:

• Introducing cashflow forecasting to help you plan ahead.

• Switching to model portfolios, which cut costs and make managing investments more efficient.

• Moving from advisory to discretionary investment management, so we can make decisions faster and take advantage of market opportunities.

This next step – creating our own funds – is a natural evolution. It will make us more nimble,reduce admin, and give us more investment flexibility.

Right now, making changes to your portfolio takes time. We have to rebalance everything in bulk, which isn’t as quick as we’d like. With these new funds, we can make real-time investment decisions, which should improve returns.

Yes, costs will go up slightly (by around 0.35% – 0.45% per year), but we expect this to be more than offset by better performance and efficiency. Here’s how:

• We can access institutional pricing.

• The larger scale of the funds will help keep overall costs down.

• Investment changes won’t trigger capital gains tax, meaning fewer tax implications for you.

To put this into perspective, we believe these efficiencies will more than cover the slight cost increase, improving your overall returns over time.

The Market Growth Fund (focused on equities) and the Market Defensive Fund (focused on bonds) will each hold around 20 carefully chosen investments. This allows us to be much more precise with asset allocation than our current four-fund model. We’ll have the flexibility to make tactical adjustments and take advantage of opportunities as they arise.

Instead of seeing lots of different holdings in your portfolio, you’ll now see just two: MGTSTown Close Market Growth and MGTS Town Close Market Defensive. Inside these, you’ll find familiar names like Vanguard, HSBC, Invesco and iShares, giving us the diversification we want while keeping things simple for you. You’ll also be able to track their performance easily, with daily pricing and clear reporting.

Your existing investments will be transferred into these two funds, but the way we manage your money and your overall strategy will remain the same. You’ll still be invested in a carefully balanced mix of equities and bonds, tailored to your needs.

• Your financial plan and risk level won’t change.

• The same team will be managing your investments.

• We’ll continue to oversee everything as we always have.

• Who is managing the funds? We’ve partnered with Margetts, a company with a solid track record in fund administration. They’ll handle the day-to-day running of the funds, while we’ll continue to manage investment decisions.

• What if something happens to Jeremy? Steve Williams and Scott Mordrick are both fully qualified to step in immediately if needed, ensuring continuity in investment management. We also have a backup plan in place with external advisors if necessary.

• What about risk? This change is designed to reduce risk by making us more agile and efficient. You’ll still be invested in a well-diversified portfolio, just managed in a smarter way. Plus, as a regulated fund structure, it offers additional investor protections.

• Now – The process of setting up the funds is underway.

• Over the next 6 months – We’ll be working behind the scenes to get everything ready.

• Test Phase – We’ll start with staff and personal accounts to make sure everything runs smoothly.

• Main Transition – We’ll move client portfolios over a weekend to keep disruption to a minimum.

• Review & Feedback – Once everything is up and running, we’ll check in to makesure you’re happy and answer any questions.

We’ll keep you updated at every stage and make sure the transition is seamless.

We know this is a big change, and you might have questions. That’s why we’re holding a liveQ&A session where you can hear more about the new funds, ask anything on your mind, and chat with our investment team.

This is an exciting next step for TCFP, and we truly believe it will make a positive difference for you. If you’d like to chat before then, just give us a call or drop us an email – we’re always happy to help.