While the French National Football Team might be due to play Belgium later today as part of Euro 2024, so far is has been the political landscape which has provided the arguably more exciting competition.

The French football team limped to second place in their group, scoring just two goals in three games. In contrast the election first round saw its highest turnout of voters since the 1990s, as three ideologically opposed parties battle it out for the 577 seats that are up for grabs.

Marine Le Pen’s right wing National Rally (RN) looks to have triumphed in this round, winning around a third of all votes. A left-wing alliance, the New Popular Front, won 28% of the vote, while Macron’s Party came in third, with just over 20%.

A second round will now take place for candidates who won between 12.5% and 50% of the votes in their constituency. With the majority of seats likely still up for grabs between the three main parties, there is room for discussions between Macron’s Ensemble party and the New Popular Front on potential deals to prevent an RN outright majority.

For investors, this election has so far provided short-term uncertainty. However, long-term, we won’t know the full impact until a winner is officially declared. Regardless of the result, it is important to remember that the French equities market consists of mainly international companies, with Amundi reporting that over 80% of sales come from abroad.

Offering further detail, Vincent Mortier, Group CIO at Amundi noted: “Sectors with higher domestic exposure and greater sensitivity to political uncertainty have been affected the most. This is the case of more regulated sectors, such as utilities and infrastructure, as the market weighs the risks related to potential privatisation, nationalisation or revision of contracts.”

“Financials are also vulnerable to uncertainty, notably because banks are major holders of government bonds. The market is also pricing risks related to potential changes in taxation. However, large French banks are well capitalised, have diversified business models, and already trade at a discount to the European banking sector and their long-term average.”

In other markets, US stocks continued their strong run last week, with the S&P 500 and NASDAQ continuing to trade at record highs, although falls on Friday took some of the sheen off the performance. The big talking point in the US was the Presidential debate, where incumbent Joe Biden appeared to lose his train of thought on several occasions, leading to further worries about his age. With the election not until November, there still doesn’t appear to be a clear front runner, however this uncertainty was more than counteracted by the ongoing AI-driven optimism in the World’s largest economy.

Returning to the Euros, the England Football Team has looked perhaps even more uninspiring than the French so far, despite progressing through to the Quarter finals. Progress came courtesy of a last-minute wonder goal from Jude Bellingham. Rishi Sunak will be hoping for the similar last-minute miracle, as poll after poll shows Labour on course for a large majority in the UK Election later this week. For Mark Dowding, Chief Investment Officer at BlueBay, however: “The upcoming election in the UK has been long decided. Without there being much of a contest, the upcoming vote on July 4th seems to be generating about as much excitement as the country’s football team, with this seeming to send most people to sleep.”

60 years old is the new middle age. We’re all living longer, and by 2034, more than one million UK families may have multiple generations in retirement simultaneously– a 32% increase on today’s figure of 813,000.¹

Family wealth and financial wellbeing often pivot around inheritances. They can be life-changing sums of money, enabling families to pay off a mortgage, or send children to university. However, longer lifespans mean there’s less family money for the next generation to inherit.

“You’re more likely to inherit in your sixties now,” says Tony Clark, Senior Propositions Manager at SJP. “By that age, you may be mortgage-free, or even retired yourself.”

“So, the question is, do you really need the money? Would it be better spent helping younger family members who are struggling with mortgage payments, or paying nursery or school fees? Or could it help elderly relatives shoulder the huge cost burden of long-term care?“

Five questions to ask yourself if you’re a multi-retiree family.

1. Should an inheritance skip a generation, and if so, is the family in agreement on who should get what, and when?

2. Has the family as a whole, discussed the possibility of long-term care for more than one generation – who would help out, and how would costs be covered? Social care is something few people save for, but most of us are likely to need.

3. If you’re a blended family with several generations already in retirement, have you thought about how to pass money on to grandchildren from earlier relationships, fairly and tax efficiently? Have existing Wills or Death in Service benefits been updated to reflect these wishes?

4. Do adult family members have Powers of Attorney in place? Most people don’t think about putting this simple financial safeguard in place until they’re retired, but anyone may need a Power of Attorney at any age, even if it’s only to cover a temporary period of incapacity.

5. Are your finances set to be as tax efficient as they can be? The more you use all your allowances, the less tax you may pay – and the longer your money will last.

If you think you need to make some changes to your financial plans, or put new ones in place, contact us today.

The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.

Source

¹Research conducted  by Opinium, among 4,000 UK adults between 27th February – 8th March 2024. All results are weighted to nationally representative criteria. Estimating the number of families with multiple retired generations relies on looking at the age of children of the eldest age groups and projecting how changing demographics will impact these figures. We know approximately how many older age groups have a child aged 65 and above currently, and we have applied those percentages to the ONS projections of increased numbers of adults aged 80-89 and 90+, to ascertain future numbers of families with more than one generation in retirement.

“Not a single vote must go to the National Rally. France does not deserve that.”

French Prime Minister Gabriel Attal says his party will do whatever it takes to prevent RN gaining control of Parliament.