Most normal people, and I'm assuming you're one of them, don't wake up in the morning thinking about the Treaty of Lisbon. Neither do most people wake up thinking about annuities. So I would be doubly surprised if anybody (apart from a few pension geeks) woke up today thinking about the Treaty of Lisbon and Annuities in the same thought.
But from 1st March these two seemingly separate things could have a significant and detrimental impact on retirement income. It looks as though men will be hit quite hard, but so could married couples, particularly where the majority of retirement income will come from the man's pension. Before I get everybody's blood pressure up I should point out that if you're already retired and have purchased an annuity with your pension funds, this isn't going to affect you. Relax and enjoy the rest of the day.
For everyone else, here's the story. In September 2010 Dr Juliane Kokott, an Advocate General in the European Court of Justice argued that using a person's gender when underwriting insurance policies was actually sex discrimination, and therefore did not comply with the provisions contained within the Charter for Fundamental Rights.
I had better take a couple of steps back to give you some background. When an insurance company wants to calculate how to charge for a life insurance policy, it will take into consideration a variety of different things, the age of the person, the medical history and the gender. The same happens when working out how much income to pay someone in exchange for their pension fund.
The older a person is the shorter their remaining lifespan, this means that a higher level of income can be paid. Likewise, if someone is in poor health they have a shorter lifespan, and consequently the more income that can be paid. Finally, because men are statistically likely to die at a younger age than a woman, they too receive a higher income because the pension fund does not need to last so long.
Age, health and gender have been legitimate factors in the calculation of insurance, risk and annuity returns but now an unintended consequence of the Treaty of Rome will mean the majority of people will be worse off.
Nature has little regard for the Treaty of Lisbon so unfortunately men, we're still more likely to die at a lower age than women. This means that if insurance companies are compelled to offer same sex annuity rates, the age expectancy for men will rise (on paper rather than in real life), and their annuity income will decrease. That will hit their pockets with a reduction in income of around 5% being talked about, though some commentators have suggested there will be a 13% difference. Put another way, a £100 income payment could fall to between £87 and £95, neither of them a favourable outcome.
The ruling will be announced on March 1st, but many insurance companies have already started to withdraw their current annuity rates in favour of unisex rates. This is because the 14 day acceptance period for annuities would take them beyond the 1st March.
Tuesday, 15 February 2011
Monday, 20 December 2010
Insurance Companies: are they as immoral as Tobacco Companies?
Analogies. They're useful for looking at situations from a different perspective in order to make sense of them. So I want you to consider a scenario where tobacco companies use a cocktail of chemicals to enhance the addictive effects of nicotine in the cigarettes they sold. I guess that's not so hard to believe.
What if those tobacco companies were then told they had to make cigarettes less addictive? What if they were given a specific date by which this must be done? Don't misunderstand me, smoking wouldn't be banned, and smokers would still be able to choose whether to smoke or not, but they wouldn't find themselves addicted.
It would be odd then for tobacco companies to continue selling highly addictive cigarettes in the run up to the ban, whilst at the same time telling smokers how easy it is to kick the habit - wouldn't it? In fact you might feel outraged.
That's how I feel when I hear big Life Insurance Companies telling Financial Advisers how to wean themselves off commission, and at the same time still pushing products that have opaque commission and charging structures. Let's face it, some of the charging structures that exist on single premium life assurance bonds are only there to disguise high levels of commission. The misuse of commission has helped create and perpetuate the myth that financial advice is free.
At the time it must have seemed like a cracking wheeze. Create a charging structure that looked like the insurance company was giving the investor free money! 110% allocation rates, 5% bid offer spread: invest £100,000 and see the bid value rise to £105,000 the minute the money is invested. But if you wanted to cash in, well that's another story - but nobody wants to cash in on day one do they? And if the Annual Management Charge is a mere 1.5% that's OK isn't it. And the Establishment charge - what's that? A tiny 1% per annum and it's only for 5 years. Oh and a teeny weeny policy charge, switch charge, oh and don't forget the underlying fund charges. Confused? Robbed more likely.
Investors must have been confused because they bought these things by the bucket load, and still do. And some advisers have been raking in commissions like there's no tomorrow - which for some is probably true, because they have no intention of taking exams or operating in a world that bans commission.
But I don't want to talk about advisers, I want to focus on the morals of the large financial institutions that allowed this situation to occur in the first place, and who today are operating with dual standards.
Who in their right minds thought it was a good idea to create investment bonds with opaque charging structures? And in a world where investors and advisers were already addicted to commission, then added a heady cocktail of alternative charges and vague percentage points to ramp up the addiction? It must have felt like a stroke of genius!
Now it's come back to bite them. Because all those advisers that never had deep and meaningful conversations with clients about advice, or about how much it costs are floundering. The were duped by the product manufacturers into selling things without realising they were becoming addicted to the easy sale - they never thought it would end. Commission is easy, and can even be made to look like someone else pays. Kerching!
But now, when these insurance companies see their cash cow under threat, they run round offering to help their customers (financial advisers) adapt to change. But not to worry, we'll still retain the opacity of the existing charging structures until the very end. Then, reluctantly they'll turn off the life support machine. There will be some final gasps, shouts of anger and then, for some advisers, it'll be curtains. For others they'll struggle on, gasping for oxygen, and clinging on to whatever hope they've been given by their friendly life company, until they too fall by the wayside.
In my opinion Insurance Companies have acted immorally and operate in a self serving manner - which is completely at odds with their 'mutual' roots. The ending of commission on sales financial products is as much to do with their actions as anyone else's. They should recognise this and feel very ashamed when going into advisers offices offering to teach them how to adapt to the new world order.
What if those tobacco companies were then told they had to make cigarettes less addictive? What if they were given a specific date by which this must be done? Don't misunderstand me, smoking wouldn't be banned, and smokers would still be able to choose whether to smoke or not, but they wouldn't find themselves addicted.
It would be odd then for tobacco companies to continue selling highly addictive cigarettes in the run up to the ban, whilst at the same time telling smokers how easy it is to kick the habit - wouldn't it? In fact you might feel outraged.
That's how I feel when I hear big Life Insurance Companies telling Financial Advisers how to wean themselves off commission, and at the same time still pushing products that have opaque commission and charging structures. Let's face it, some of the charging structures that exist on single premium life assurance bonds are only there to disguise high levels of commission. The misuse of commission has helped create and perpetuate the myth that financial advice is free.
At the time it must have seemed like a cracking wheeze. Create a charging structure that looked like the insurance company was giving the investor free money! 110% allocation rates, 5% bid offer spread: invest £100,000 and see the bid value rise to £105,000 the minute the money is invested. But if you wanted to cash in, well that's another story - but nobody wants to cash in on day one do they? And if the Annual Management Charge is a mere 1.5% that's OK isn't it. And the Establishment charge - what's that? A tiny 1% per annum and it's only for 5 years. Oh and a teeny weeny policy charge, switch charge, oh and don't forget the underlying fund charges. Confused? Robbed more likely.
Investors must have been confused because they bought these things by the bucket load, and still do. And some advisers have been raking in commissions like there's no tomorrow - which for some is probably true, because they have no intention of taking exams or operating in a world that bans commission.
But I don't want to talk about advisers, I want to focus on the morals of the large financial institutions that allowed this situation to occur in the first place, and who today are operating with dual standards.
Who in their right minds thought it was a good idea to create investment bonds with opaque charging structures? And in a world where investors and advisers were already addicted to commission, then added a heady cocktail of alternative charges and vague percentage points to ramp up the addiction? It must have felt like a stroke of genius!
Now it's come back to bite them. Because all those advisers that never had deep and meaningful conversations with clients about advice, or about how much it costs are floundering. The were duped by the product manufacturers into selling things without realising they were becoming addicted to the easy sale - they never thought it would end. Commission is easy, and can even be made to look like someone else pays. Kerching!
But now, when these insurance companies see their cash cow under threat, they run round offering to help their customers (financial advisers) adapt to change. But not to worry, we'll still retain the opacity of the existing charging structures until the very end. Then, reluctantly they'll turn off the life support machine. There will be some final gasps, shouts of anger and then, for some advisers, it'll be curtains. For others they'll struggle on, gasping for oxygen, and clinging on to whatever hope they've been given by their friendly life company, until they too fall by the wayside.
In my opinion Insurance Companies have acted immorally and operate in a self serving manner - which is completely at odds with their 'mutual' roots. The ending of commission on sales financial products is as much to do with their actions as anyone else's. They should recognise this and feel very ashamed when going into advisers offices offering to teach them how to adapt to the new world order.
Thursday, 16 December 2010
The Gift of Giving is Less Sweet with Nectar
An update to my earlier blog today about loyalty points.
If you read my earlier blog "Dreams of a Big Reward Slowly Deflated" you will recall that I was going to donate all the unused points collected on my Nectar Card to Charity. In total I had 21,287 points which equated to approximately £106 if I spent them online with one of the reward partners (each 500 points is worth £2.50).
After a lot of searching I eventually found a page for me to gift these points to Charity - they have a link for donating to the Action for Children charity. It's worth noting that all the Reward partners are prominently listed, but if you want to spend points by gifting to charity you really have to know that this is what you want to do, and then persevere in order to find the page among all the links for Sainsbury's, Amazon, Laithwaites and Debenhams for example.
Finally I found the page and discovered that they would convert my points at a rate of £1 for every 250 points, and they only dealt in multiples of 250 points. That means that to the nearest 250 points my 21,287 points had a value to charity of only £85 - where did the other £21 go?
Discovering that Action for Children would only receive £85 and not £106 was starting to take the shine off my early morning gift of giving - but I carried on and found the a box where I could type in the number of points to be gifted - 21,250 - except that it would only accept 3 digits. Seemingly the maximum I could transfer at any one time was 750 points - or £3. This wasn't going smoothly. It was as if every time I wanted to make this gift another obstacle was put in my way - maybe I would relent and go shopping with iTunes or Argos instead.
So I gave the helpline a call and spoke to a (polite) customer services representative and after much going back and forth with his supervisor finally said that he would transfer all my points to the charity......and then disable my card.
"Hang on a moment" I said, "what do you mean, disable my card? I don't want to disable my card, I just want to give these points to charity and then carry on collecting points so that I might do it again next Christmas."
"No problem" he said, "you can pick up another card next time you go shopping"
"But I don't want to pick up another card, I've got a perfectly serviceable card here. In fact I've had it 8 years and I don't want the bother of having to pick out another card, re-register it, then opt-out from all your retailers emails and junk mail offers every five minutes. Why can't I just give 21,250 points to charity and then carry on as normal?"
Back to the Supervisor, and eventually I was transferred so that I could speak to her directly.
Two minutes later, job done. Points transferred and I keep my card. But it wasn't easy. Surely giving to charity can be a simpler process with Nectar - and why does it have to be financially punitive. Why not gift the points to them so that they can purchase the things they need from retailers so that they get the full value of what the points are worth to me. £106 down to £85 - that's robbery isn't it?
If you read my earlier blog "Dreams of a Big Reward Slowly Deflated" you will recall that I was going to donate all the unused points collected on my Nectar Card to Charity. In total I had 21,287 points which equated to approximately £106 if I spent them online with one of the reward partners (each 500 points is worth £2.50).
After a lot of searching I eventually found a page for me to gift these points to Charity - they have a link for donating to the Action for Children charity. It's worth noting that all the Reward partners are prominently listed, but if you want to spend points by gifting to charity you really have to know that this is what you want to do, and then persevere in order to find the page among all the links for Sainsbury's, Amazon, Laithwaites and Debenhams for example.
Finally I found the page and discovered that they would convert my points at a rate of £1 for every 250 points, and they only dealt in multiples of 250 points. That means that to the nearest 250 points my 21,287 points had a value to charity of only £85 - where did the other £21 go?
Discovering that Action for Children would only receive £85 and not £106 was starting to take the shine off my early morning gift of giving - but I carried on and found the a box where I could type in the number of points to be gifted - 21,250 - except that it would only accept 3 digits. Seemingly the maximum I could transfer at any one time was 750 points - or £3. This wasn't going smoothly. It was as if every time I wanted to make this gift another obstacle was put in my way - maybe I would relent and go shopping with iTunes or Argos instead.
So I gave the helpline a call and spoke to a (polite) customer services representative and after much going back and forth with his supervisor finally said that he would transfer all my points to the charity......and then disable my card.
"Hang on a moment" I said, "what do you mean, disable my card? I don't want to disable my card, I just want to give these points to charity and then carry on collecting points so that I might do it again next Christmas."
"No problem" he said, "you can pick up another card next time you go shopping"
"But I don't want to pick up another card, I've got a perfectly serviceable card here. In fact I've had it 8 years and I don't want the bother of having to pick out another card, re-register it, then opt-out from all your retailers emails and junk mail offers every five minutes. Why can't I just give 21,250 points to charity and then carry on as normal?"
Back to the Supervisor, and eventually I was transferred so that I could speak to her directly.
Two minutes later, job done. Points transferred and I keep my card. But it wasn't easy. Surely giving to charity can be a simpler process with Nectar - and why does it have to be financially punitive. Why not gift the points to them so that they can purchase the things they need from retailers so that they get the full value of what the points are worth to me. £106 down to £85 - that's robbery isn't it?
Dreams of a Big Reward Slowly Deflated
Oh the shame! I've been caught out by inflation. It wouldn't be so bad if it wasn't for the fact, I spend a lot of my time pointing out to others the dangers of inflation. Now I'm looking in the mirror and admitting to myself that I took my eye off the ball. And it's not a new thing, I took my eye off the ball almost 8 years ago and only recently got my eye back on the ball.
It came home to me shortly after my last shopping trip at Sainsburys; they are part of the Nectar Reward Card programme. I was at the check-out (and for a change it wasn't one of the self service ones), and I handed my Nectar Card across so that it could be swiped and my points credited.
"Oooh" said the checkout girl, "you've got a lot of points on your card, you should spend them".
"How much are worth to me" I asked.
"Oh I don't know, maybe £80" she replied.
£80 I thought, surely that can't be right. The points were worth at least that amount in 2002, which was when the Nectar Reward scheme started. Prior to then I had been savings points on the BarclayCard scheme, which eventually merged into the Nectar points scheme, and all my accumulated points transferred across.
In 2002 I had sufficient points on my BarclayCard to exchange for goods valued around £80 - £100 but there was nothing in the catalogue that really inspired me, so I let my points roll over. Over the ensuing 8 years I've been accumulating the odd couple of hundred points here and there. I'm not a serious collector, but in the back of my mind I figured I had built up a sizable number of points that I could exchange for something slightly better than the food mixer I could have had in 2002.
I didn't believe that my points value would have remained static so I went online to check how many points I had, and what I could exchange them for. I was shocked to find that I could exchange my accumulated points for the same bleedin' food mixer I could have had in 2002! What was going on?
The fact is, inflation is what's been going on. The value of my points has been reducing almost as quickly as the rate that I've been accumulating them. In short, inflation has eaten into my points value. These Reward points are hardly rewarding - particularly over a long period of time.
There is a lesson to be learned from this; and that's to spend points often, don't wait to accumulate a large number of points unless you can do it over a short space of time. It's the same with Airmiles. The most recent statistic I read estimated that there were 20 trillion (that's 20,000,000,000,000) unspent airmiles in circulation, across various airline loyalty schemes. I've got enough to fly first class to Tokyo and back, and again to New York and back, but I notice that the number of miles needed to redeem a free flight increases every year, so my points value is slowly deflating.
There's no interest for loyalty it seems. So, if like me you rarely get round to spending them, it might be better to give them to someone who will. I'm going to go online and transfer my Nectar points to charity - that way someone will get their value today. I think I'll keep the airmiles though - I have some travel plans for 2011.
It came home to me shortly after my last shopping trip at Sainsburys; they are part of the Nectar Reward Card programme. I was at the check-out (and for a change it wasn't one of the self service ones), and I handed my Nectar Card across so that it could be swiped and my points credited.
"Oooh" said the checkout girl, "you've got a lot of points on your card, you should spend them".
"How much are worth to me" I asked.
"Oh I don't know, maybe £80" she replied.
£80 I thought, surely that can't be right. The points were worth at least that amount in 2002, which was when the Nectar Reward scheme started. Prior to then I had been savings points on the BarclayCard scheme, which eventually merged into the Nectar points scheme, and all my accumulated points transferred across.
In 2002 I had sufficient points on my BarclayCard to exchange for goods valued around £80 - £100 but there was nothing in the catalogue that really inspired me, so I let my points roll over. Over the ensuing 8 years I've been accumulating the odd couple of hundred points here and there. I'm not a serious collector, but in the back of my mind I figured I had built up a sizable number of points that I could exchange for something slightly better than the food mixer I could have had in 2002.
I didn't believe that my points value would have remained static so I went online to check how many points I had, and what I could exchange them for. I was shocked to find that I could exchange my accumulated points for the same bleedin' food mixer I could have had in 2002! What was going on?
The fact is, inflation is what's been going on. The value of my points has been reducing almost as quickly as the rate that I've been accumulating them. In short, inflation has eaten into my points value. These Reward points are hardly rewarding - particularly over a long period of time.
There is a lesson to be learned from this; and that's to spend points often, don't wait to accumulate a large number of points unless you can do it over a short space of time. It's the same with Airmiles. The most recent statistic I read estimated that there were 20 trillion (that's 20,000,000,000,000) unspent airmiles in circulation, across various airline loyalty schemes. I've got enough to fly first class to Tokyo and back, and again to New York and back, but I notice that the number of miles needed to redeem a free flight increases every year, so my points value is slowly deflating.
There's no interest for loyalty it seems. So, if like me you rarely get round to spending them, it might be better to give them to someone who will. I'm going to go online and transfer my Nectar points to charity - that way someone will get their value today. I think I'll keep the airmiles though - I have some travel plans for 2011.
Wednesday, 15 December 2010
Does Art Imitate Life....Planning? Redoux
After I re-read my earlier piece I felt that I hadn't really looked at the question 'does art imitate life planning' and instead had merely set the scene. Today I want to dig a bit deeper into my thoughts and explain a little better what I was really trying to say.
I should also say that by Life Planning, I am talking about this in the context of Life Financial Planning
If you wanted a portrait to hang on your wall you've got several different options right? You could wander to a tourist venue to find a caricature artists. Depending on the skill of the artist you would expect a sketch with a reasonable likeness of you in about 10 - 30 minutes. It would be relatively inexpensive thing to do. Does this imitate Life Financial Planning - I don't think so. This is more like opening a savings account because you have an idea that you need to save for the future, but there's nothing specific about it.
You may have given it a bit more thought. You may be prepared to spend a bit more money. And you may have a particular style in mind. For example, people who want a Julian Opie style portrait (he is perhaps best known for the original Blur Album cover with the 4 band member's aces - you can see his work on his website) there are many copycat places where you cans end a photograph and have it digitally copied to produce your own 'Blur' like image.
So does this art resemble life planning? Again I don't think so. Sure you have a better idea of what you like and what you don't like. You even have a degree of control over the photograph you submit to be digitally enhanced and reproduced, but it's mass market and formulaic. It will look very much like the thousands of other prints produced this way. Opie's pictures on the other hand cost several thousands, and the original works are tens of thousands of £. Each piece is meticulously crafted to provide an accurate likeness using the minimum amount of information - I find them fascinating pieces and always find something new in them to capture my attention. These massed produced works look individual but they're fairly standard stuff, it's not Life Financial Planning, more like buying an investment with a particular theme. You like Gold this year so you'll buy a Gold Fund, next year it could be Technology.
Further up the ladder you might find a portrait painter advertising in a quality magazine who will work from a photograph. Typically you will be asked to send in a head and shoulders picture, well lit, and in a few weeks you'll get a copy painted in oils. It will have cost a few hundred pounds, but a decent frame might cost more! These pictures can be very hit and miss. The skill of the artist is in turning these around quickly. They're a likenesses rather than an interpretation of the subject.
Again, does it resemble Life Financial Planning. The answer has got to be no. However, I don't want to take too much away from this as it's something that will probably give a lot of pleasure over the years. It feels unique even though it is a quickly produced picture. It would be like taking some very low cost financial advice, with the objective of buying a product rather than receiving any actual financial planning. It has its place.
Move a little further up the ladder and you'll find an artist to actually meet with you. They'll have a studio and a catalogue of previous works. You'll talk about what you're looking for but it will quickly become apparent that this type of artist has a repertoire that he/she works to. A bit like buying Henry Ford's Model T - you can have any colour so long as it's black.
To me this resembles the way that a lot of financial planners work. It's good solid work and the results are broadly bespoke. But it's still not Life Financial Planning - not in my book.
But there are some artists that prefer to engage with their clients to produce a piece of work that the sitter actually wants. You'll not be forced to sit down, facing a quarter turn to the left for example. Instead you will be able to explore and develop themes that are pertinent to you alone. You can add things that have special meaning to you, create a picture that includes things that are not necessarily real - imaginary backdrops that enhance the effect. Pick objects, fabrics and poses that have real meaning to you.
This is what I meant when I asked the question - does art imitate life planning? Yes it does when it is done like this. It's not an inexpensive option, but it is truly personal - a painting that will be unlike any other produced by the same artist. And there will have to be a real connection between artist and sitter - they need to get on, be on the same wavelength. The artist with his/her skill should be able to make suggestions and challenge things, because they have previous experience to inform them. It results in a piece of work that both sides are proud of.
And that's what I was trying to say.
I should also say that by Life Planning, I am talking about this in the context of Life Financial Planning
If you wanted a portrait to hang on your wall you've got several different options right? You could wander to a tourist venue to find a caricature artists. Depending on the skill of the artist you would expect a sketch with a reasonable likeness of you in about 10 - 30 minutes. It would be relatively inexpensive thing to do. Does this imitate Life Financial Planning - I don't think so. This is more like opening a savings account because you have an idea that you need to save for the future, but there's nothing specific about it.
You may have given it a bit more thought. You may be prepared to spend a bit more money. And you may have a particular style in mind. For example, people who want a Julian Opie style portrait (he is perhaps best known for the original Blur Album cover with the 4 band member's aces - you can see his work on his website) there are many copycat places where you cans end a photograph and have it digitally copied to produce your own 'Blur' like image.
So does this art resemble life planning? Again I don't think so. Sure you have a better idea of what you like and what you don't like. You even have a degree of control over the photograph you submit to be digitally enhanced and reproduced, but it's mass market and formulaic. It will look very much like the thousands of other prints produced this way. Opie's pictures on the other hand cost several thousands, and the original works are tens of thousands of £. Each piece is meticulously crafted to provide an accurate likeness using the minimum amount of information - I find them fascinating pieces and always find something new in them to capture my attention. These massed produced works look individual but they're fairly standard stuff, it's not Life Financial Planning, more like buying an investment with a particular theme. You like Gold this year so you'll buy a Gold Fund, next year it could be Technology.
Further up the ladder you might find a portrait painter advertising in a quality magazine who will work from a photograph. Typically you will be asked to send in a head and shoulders picture, well lit, and in a few weeks you'll get a copy painted in oils. It will have cost a few hundred pounds, but a decent frame might cost more! These pictures can be very hit and miss. The skill of the artist is in turning these around quickly. They're a likenesses rather than an interpretation of the subject.
Again, does it resemble Life Financial Planning. The answer has got to be no. However, I don't want to take too much away from this as it's something that will probably give a lot of pleasure over the years. It feels unique even though it is a quickly produced picture. It would be like taking some very low cost financial advice, with the objective of buying a product rather than receiving any actual financial planning. It has its place.
Move a little further up the ladder and you'll find an artist to actually meet with you. They'll have a studio and a catalogue of previous works. You'll talk about what you're looking for but it will quickly become apparent that this type of artist has a repertoire that he/she works to. A bit like buying Henry Ford's Model T - you can have any colour so long as it's black.
To me this resembles the way that a lot of financial planners work. It's good solid work and the results are broadly bespoke. But it's still not Life Financial Planning - not in my book.
But there are some artists that prefer to engage with their clients to produce a piece of work that the sitter actually wants. You'll not be forced to sit down, facing a quarter turn to the left for example. Instead you will be able to explore and develop themes that are pertinent to you alone. You can add things that have special meaning to you, create a picture that includes things that are not necessarily real - imaginary backdrops that enhance the effect. Pick objects, fabrics and poses that have real meaning to you.
This is what I meant when I asked the question - does art imitate life planning? Yes it does when it is done like this. It's not an inexpensive option, but it is truly personal - a painting that will be unlike any other produced by the same artist. And there will have to be a real connection between artist and sitter - they need to get on, be on the same wavelength. The artist with his/her skill should be able to make suggestions and challenge things, because they have previous experience to inform them. It results in a piece of work that both sides are proud of.
And that's what I was trying to say.
Monday, 13 December 2010
A Lesson in Poor Positioning - from American Express
I received a letter over the weekend from American Express. I have a card with them, and have done since 2000. My annual spend on the card seems to vary between £12,000 to £15,000 annually, and I pay it off each month in full. I figure that I've been a pretty good customer based on turnover, and the margin they take from retailers.
I had a little falling out with them a few years ago when they sent me some details I requested under the Data Protection Act - I received a p of data relating to another American Express customer. Highly personal details too. I'd been using a Platinum charge card and I also decided it wasn't worth spending £300 a year for the privilege of holding a Platinum card so I elected to downgrade to a Gold card. I like their reward points programme so I didn't leave them completely.
Things have been ticking along quite nicely - until I received that letter over the weekend. It said, in not so many words, that I was being upgraded from Gold to Platinum. An upgrade - to Platinum. Well perhaps they were stroking my ego after all this time. They've realised that I'm such a great ambassador for their card and it's in their best interests to get me back to Platinum status.
But I was wrong. Reading through the small print it said that my APR would change - upward. This was based on the introduction of an annual fee. Things didn't sound right. What I was reading wasn't an upgrade. I wasn't getting any additional benefits from the card; but I was getting an annual fee tacked on. How was this an upgrade?
I gave them a call. About this upgrade - if we cut to the chase this isn't this merely about changing the colour of the card and then hitting me with a fee? OK not a big fee (£36) but all the same a fee that I don't currently incur.
"That's right", said the guy on the end of the telephone line.
"So how does that make it an upgrade?" I queried.
The long and the short of it is it doesn't, but the marketing department have decided to withdraw this particular gold card product and replace it with a Platinum Credit Card (all these years I thought I had a Gold charge card - it turns out it's a credit card). I'm told it's an upgrade because my interest rate remains the same, other people will experience an interest rate rise which wouldn't be an upgrade.
Rather than be upfront and tell me that the Gold credit card was being withdrawn, they decided to sell it as an upgrade, which it very clearly isn't. If they had said that the only option available to me was a Platinum card but that it had a £36 charge, I might have felt differently - they could have offered me something to justify the £36 - but they haven't. They seem to think that I'll fall over backwards in order to get a Platinum card.
It's wrong on so many levels. Not least because they haven't adequately briefed their call centre about the changes, the poor guy on the end of the phone was fishing around for answers that simply were not there. I see Amex trying to increase their presence in the UK after years of being the card that retailers preferred not to take. But if they think they can lighten the load on retailers by adding to the load on me, they're mistaken. Time to cancel the card I think.
I had a little falling out with them a few years ago when they sent me some details I requested under the Data Protection Act - I received a p of data relating to another American Express customer. Highly personal details too. I'd been using a Platinum charge card and I also decided it wasn't worth spending £300 a year for the privilege of holding a Platinum card so I elected to downgrade to a Gold card. I like their reward points programme so I didn't leave them completely.
Things have been ticking along quite nicely - until I received that letter over the weekend. It said, in not so many words, that I was being upgraded from Gold to Platinum. An upgrade - to Platinum. Well perhaps they were stroking my ego after all this time. They've realised that I'm such a great ambassador for their card and it's in their best interests to get me back to Platinum status.
But I was wrong. Reading through the small print it said that my APR would change - upward. This was based on the introduction of an annual fee. Things didn't sound right. What I was reading wasn't an upgrade. I wasn't getting any additional benefits from the card; but I was getting an annual fee tacked on. How was this an upgrade?
I gave them a call. About this upgrade - if we cut to the chase this isn't this merely about changing the colour of the card and then hitting me with a fee? OK not a big fee (£36) but all the same a fee that I don't currently incur.
"That's right", said the guy on the end of the telephone line.
"So how does that make it an upgrade?" I queried.
The long and the short of it is it doesn't, but the marketing department have decided to withdraw this particular gold card product and replace it with a Platinum Credit Card (all these years I thought I had a Gold charge card - it turns out it's a credit card). I'm told it's an upgrade because my interest rate remains the same, other people will experience an interest rate rise which wouldn't be an upgrade.
Rather than be upfront and tell me that the Gold credit card was being withdrawn, they decided to sell it as an upgrade, which it very clearly isn't. If they had said that the only option available to me was a Platinum card but that it had a £36 charge, I might have felt differently - they could have offered me something to justify the £36 - but they haven't. They seem to think that I'll fall over backwards in order to get a Platinum card.
It's wrong on so many levels. Not least because they haven't adequately briefed their call centre about the changes, the poor guy on the end of the phone was fishing around for answers that simply were not there. I see Amex trying to increase their presence in the UK after years of being the card that retailers preferred not to take. But if they think they can lighten the load on retailers by adding to the load on me, they're mistaken. Time to cancel the card I think.
Does Art Imitate Life...Planning? Part One.
It was my wife's birthday last month. Not just any birthday, it was a milestone birthday, a celebration of another decade passing and a new decade ahead. It was a birthday that demanded serious thought regarding the choice of present - in short, it had to be memorable and fitting.
Several people following me on Twitter - my Twitter page here - already know that I commissioned a portrait of her. I was intrigued by many of the comments I received when I announced to the Twitterverse my choice of birthday present. Although the tone of the Tweets received were positive, it was clear to me that the act of commissioning a portrait was open to a variety of interpretations.
A few people thought that I had taken a photograph and sent it to an artist advertising in a magazine as 'portraits from photographs'. At least one person thought I had gone to a street artist to get a caricature style picture; the same thing had happened to her and it had been a disappointment, she hoped I would have better luck.
We're both art lovers and have a modest art collection. I knew neither of these options would have the desired effect, not only for her, but also for me. It was time to do some real research and then to dig deep in the wallet and commission a portrait that would have a lifetime WOW factor.
And so I found the Artist Stephen Earl Rogers who seemed to have an extremely good technical ability, a contemporary feel to his work, and a pedigree that fit well with what I had in mind. The initial chat with him was reassuring, and his process was not dissimilar to mine - hence the art imitating life planning title.
We arranged to meet over lunch along with my wife. It was a long lunch, over 4 hours of discussion. He told us that if we were to commission a portrait that had real meaning for us we needed to do a lot of preparatory work, and so would he. It would be a long time before anything was actually painted onto canvas. I like the approach, very much in tune with my own approach to financial planning - with a thorough and penetrating discovery phase.
I was interested to hear my wife say that the idea of having her portrait painted was daunting, and the idea of meeting the artist also daunting. Putting her at her ease was quickly done by engaging her in the process and in the outcome. This wasn't the artists painting, or his interpretation, it was to be hers. Any subtle messages were to be hers, he was simply the messenger.
It's an indulgence I know. But what the heck, she's worth it :-)
The time taken to thoroughly investigate what is really wanted is going to be time well spent. Yet not everyone wants this level of preliminary work, or even this type of outcome, whether in art or in financial life planning. Horses for courses springs to mind.
I realise that what I've done so far in this blog post is to set the scene. The question, 'does art imitate life planning' has only been touched on. I think there are some similarities which I will expand in part two - coming shortly.
Several people following me on Twitter - my Twitter page here - already know that I commissioned a portrait of her. I was intrigued by many of the comments I received when I announced to the Twitterverse my choice of birthday present. Although the tone of the Tweets received were positive, it was clear to me that the act of commissioning a portrait was open to a variety of interpretations.
A few people thought that I had taken a photograph and sent it to an artist advertising in a magazine as 'portraits from photographs'. At least one person thought I had gone to a street artist to get a caricature style picture; the same thing had happened to her and it had been a disappointment, she hoped I would have better luck.
We're both art lovers and have a modest art collection. I knew neither of these options would have the desired effect, not only for her, but also for me. It was time to do some real research and then to dig deep in the wallet and commission a portrait that would have a lifetime WOW factor.
And so I found the Artist Stephen Earl Rogers who seemed to have an extremely good technical ability, a contemporary feel to his work, and a pedigree that fit well with what I had in mind. The initial chat with him was reassuring, and his process was not dissimilar to mine - hence the art imitating life planning title.
We arranged to meet over lunch along with my wife. It was a long lunch, over 4 hours of discussion. He told us that if we were to commission a portrait that had real meaning for us we needed to do a lot of preparatory work, and so would he. It would be a long time before anything was actually painted onto canvas. I like the approach, very much in tune with my own approach to financial planning - with a thorough and penetrating discovery phase.
I was interested to hear my wife say that the idea of having her portrait painted was daunting, and the idea of meeting the artist also daunting. Putting her at her ease was quickly done by engaging her in the process and in the outcome. This wasn't the artists painting, or his interpretation, it was to be hers. Any subtle messages were to be hers, he was simply the messenger.
It's an indulgence I know. But what the heck, she's worth it :-)
The time taken to thoroughly investigate what is really wanted is going to be time well spent. Yet not everyone wants this level of preliminary work, or even this type of outcome, whether in art or in financial life planning. Horses for courses springs to mind.
I realise that what I've done so far in this blog post is to set the scene. The question, 'does art imitate life planning' has only been touched on. I think there are some similarities which I will expand in part two - coming shortly.
Sunday, 12 December 2010
Dental Health and University Funding - what's the link?
Catching up with my reading over the weekend I came across a statistic that got me thinking about the state of the nation's dental health and the current student demonstrations about university funding. The statistic, attributed to Datamonitor, came from a report "Kids' nutrition: new perspectives and opportunities" (May 2010).
It states that the average annual amount spent on sweets and chocolate per British child is £372. By comparison the average amount spent on sweets and chocolate per American child each year is £150. A difference of £222
This raises several questions in my mind:
Using a compound interest calculator I took the monthly equivalent of £18.50 and assuming it was invested in a low cost fund with an average growth rate of 7% per annum the final value of the fund would be approximately £7,850 at the end of 18 years.
Because of inflation the real value of £7,850 in closer to £3,623 if inflation averages 2.5% each year over the 18 year term.
OK so £3,623 isn't going to solve the problems of university fees and student debt, but it does make a difference. The knock on effect might be to also create a sense of fiscal responsibility that the Baby Boomer generation never really got a grip of, not collectively anyhow.
Hell, we might just put paid to the jibes from across the pond about the state of British teeth.
It states that the average annual amount spent on sweets and chocolate per British child is £372. By comparison the average amount spent on sweets and chocolate per American child each year is £150. A difference of £222
This raises several questions in my mind:
- If a child's dentistry had to be paid for (as in the US) would standards of personal dental care improve? Would this mean a reduction in the number of sweets bought for children?
- If the difference of £222 each year was invested over 18 years, how large would the resulting fund be? Could this be earmarked for higher education?
- £372 sounds like an awful lot of sweets and chocolates. What long term lessons are we feeding (literally) our children? It's not just the increasing obesity problem, increases in diabetes; are we creating a legacy of potential expensive dental care throughout life?
Using a compound interest calculator I took the monthly equivalent of £18.50 and assuming it was invested in a low cost fund with an average growth rate of 7% per annum the final value of the fund would be approximately £7,850 at the end of 18 years.
Because of inflation the real value of £7,850 in closer to £3,623 if inflation averages 2.5% each year over the 18 year term.
OK so £3,623 isn't going to solve the problems of university fees and student debt, but it does make a difference. The knock on effect might be to also create a sense of fiscal responsibility that the Baby Boomer generation never really got a grip of, not collectively anyhow.
Hell, we might just put paid to the jibes from across the pond about the state of British teeth.
Friday, 10 December 2010
Taxing Santa - Inheritance Tax on Christmas Gifts?
Recent years have seen a lot of focus on the inheritance tax Nil Rate Band. The Conservative government recently promised to raise it to £1 million - but that was before they came to power.
Focusing on this allowance alone ignores the fact that other allowances have not been raised since they were announced in 1986. As a result how many of us are creating potential inheritance tax problems in this season of giving? Will your Christmas Gifts turn into a potential tax on Santa?
Many of the gifts we make throughout the year fall under the Small Gifts exemption, which hasn't changed since it was set in 1986. And it's not just the Small Gifts exemption, virtually all the other allowances that were set at the same time have not been increased. They've been set in concrete for so long that most financial advisers I know can reel them off in their sleep, and so can their clients.
I'm sure you're as aware as I am just how easy is is to breach the £250 limit, and not just when totting up gifts throughout the year. A single gift at Christmas would do it. An iPad for your son perhaps, or a Louis Vuitton handbag for your daughter's special birthday (I'm speaking from experience here) and you've breached the limit before taking anything else into consideration.
Of course, there is another exemption. Gifts out of normal expenditure are not subject to the limits already mentioned, though there are other rules to follow. Larger gifts that fall outside the small gifts exemption limit need to be regular and habitual in nature, and need to come from income without reducing the donor's standard of living.
Larger one off gifts to celebrate special birthdays and occasions may easily breach any established patterns of expenditure, and will create need to be considered for inheritance tax planning purposes.
Ahh, the Spirit of Christmas and the Joys of Giving. It's all just a little bit more complicated that it needs to be. A big help however would be to increase the level of the various gift allowances so that they better reflect current day spending levels.
Pens at the ready, it's time to drop a line to your MP. After all, it would be nice if our giving became a little bit easier.
Focusing on this allowance alone ignores the fact that other allowances have not been raised since they were announced in 1986. As a result how many of us are creating potential inheritance tax problems in this season of giving? Will your Christmas Gifts turn into a potential tax on Santa?
Many of the gifts we make throughout the year fall under the Small Gifts exemption, which hasn't changed since it was set in 1986. And it's not just the Small Gifts exemption, virtually all the other allowances that were set at the same time have not been increased. They've been set in concrete for so long that most financial advisers I know can reel them off in their sleep, and so can their clients.
- Small Gifts Allowance - £250
- Annual Allowance - £3,000
- Gift's in consideration of marriage ranging from £1,000 - £5,000 depending on the relationship
- Gifts to political parties - unlimited (why doesn't that surprise me).
- Small Gifts Allowance - £565
- Annual Allowance - £6,774
- Gifts in consideration of marriage ranging from £2,258 - £11,290 depending on the relationship
I'm sure you're as aware as I am just how easy is is to breach the £250 limit, and not just when totting up gifts throughout the year. A single gift at Christmas would do it. An iPad for your son perhaps, or a Louis Vuitton handbag for your daughter's special birthday (I'm speaking from experience here) and you've breached the limit before taking anything else into consideration.
Of course, there is another exemption. Gifts out of normal expenditure are not subject to the limits already mentioned, though there are other rules to follow. Larger gifts that fall outside the small gifts exemption limit need to be regular and habitual in nature, and need to come from income without reducing the donor's standard of living.
Larger one off gifts to celebrate special birthdays and occasions may easily breach any established patterns of expenditure, and will create need to be considered for inheritance tax planning purposes.
Ahh, the Spirit of Christmas and the Joys of Giving. It's all just a little bit more complicated that it needs to be. A big help however would be to increase the level of the various gift allowances so that they better reflect current day spending levels.
Pens at the ready, it's time to drop a line to your MP. After all, it would be nice if our giving became a little bit easier.
Wednesday, 8 December 2010
HMRC Gobbledygook
Very occasionally we meet a new client who has failed to claim higher rate tax relief on their pension contributions. Basic rate tax relief will almost always be given at source, so that if paying £100 per month into a pension the actual payment made is only £80 and the pension company reclaim the other £20 from Her Majesty's Revenue & Customs (HMRC).
For Higher Rate (40%) tax payers that leaves a further 20% of tax to be reclaimed, but not everyone does this. The amount of tax, when left unclaimed for several years, can be quite significant, and when it is reclaimed can feel like a small windfall. It's not unusual for the amount to run into thousands of pounds.
Although I'm not an accountant I know enough to help these clients reclaim their overpaid tax without incurring more professional fees elsewhere or spending a huge amount of time. Until recently that is.
The last person we assisted had unclaimed tax going back over several years. We drafted a letter for her to send to her pension companies asking for a certificate of contributions paid in each tax year. This ensured that the correct amount could be reclaimed and proof of the contributions available to send to HMRC.
Armed with this information a letter was sent to HMRC on 30th September asking for a refund, in this instance it was approximately £3,500 which had accumulated over several years. On 23rd November HMRC wrote back (that's 54 days, nearly 8 weeks) stating that from 1st April 2010 something they called Overpayment Relief replaced Error or Mistake Relief under Section 33.
It then went on to say that as the time period for amending the the Self Assessment tax returns had passed for all but the most recent year she now needed to write to HM Inspector to amend the return on her behalf.
Well that doesn't sound very helpful. I say this because the original letter asking for a repayment of the overpaid tax had been sent to her HM Inspector of taxes. The letter also gave details of each tax year and the amounts overpaid. This however isn't good enough for HMRC.
She was then told that if she wished to claim Overpayment Relief she needed to write to HM Inspector within four years of the end of the tax year she is claiming for stating that she is making a claim for Overpayment Relief under Schedule 1AB TMA 1970 (Paragraph 51 Schedule 18 Finance Act 1998 for Corporation Tax claims) along with the following
Having seen the original letter to HM Inspector, and the accompanying certificates of contributions paid, all the information asked for has been provided. Do we really need people to quote the relevant tax Schedule and Taxes Act to recover money that rightfully belongs to them?
The letter came from Customer Operations - surely the function of Customer Operations should be to ensure that a claim is directed to the right department internally. Surely if a customer writes a letter to HMRC asking for a tax refund because they have failed to claim pension tax relief, and provides the proof this should be sufficient.
The government say that they abhor waste, red tape and inefficiency. Well judging by this example they don't have to look very far to make some significant savings. Or is the real objective simply to make it too damn difficult for the ordinary man or woman on the street to get their money back?
For Higher Rate (40%) tax payers that leaves a further 20% of tax to be reclaimed, but not everyone does this. The amount of tax, when left unclaimed for several years, can be quite significant, and when it is reclaimed can feel like a small windfall. It's not unusual for the amount to run into thousands of pounds.
Although I'm not an accountant I know enough to help these clients reclaim their overpaid tax without incurring more professional fees elsewhere or spending a huge amount of time. Until recently that is.
The last person we assisted had unclaimed tax going back over several years. We drafted a letter for her to send to her pension companies asking for a certificate of contributions paid in each tax year. This ensured that the correct amount could be reclaimed and proof of the contributions available to send to HMRC.
Armed with this information a letter was sent to HMRC on 30th September asking for a refund, in this instance it was approximately £3,500 which had accumulated over several years. On 23rd November HMRC wrote back (that's 54 days, nearly 8 weeks) stating that from 1st April 2010 something they called Overpayment Relief replaced Error or Mistake Relief under Section 33.
It then went on to say that as the time period for amending the the Self Assessment tax returns had passed for all but the most recent year she now needed to write to HM Inspector to amend the return on her behalf.
Well that doesn't sound very helpful. I say this because the original letter asking for a repayment of the overpaid tax had been sent to her HM Inspector of taxes. The letter also gave details of each tax year and the amounts overpaid. This however isn't good enough for HMRC.
She was then told that if she wished to claim Overpayment Relief she needed to write to HM Inspector within four years of the end of the tax year she is claiming for stating that she is making a claim for Overpayment Relief under Schedule 1AB TMA 1970 (Paragraph 51 Schedule 18 Finance Act 1998 for Corporation Tax claims) along with the following
- The tax year the overpayment was made
- why she considered the overpayment excessive
- if she has previously appealed the payment of assessment
- include documentary proof of the tax deducted or paid in some other way.
Having seen the original letter to HM Inspector, and the accompanying certificates of contributions paid, all the information asked for has been provided. Do we really need people to quote the relevant tax Schedule and Taxes Act to recover money that rightfully belongs to them?
The letter came from Customer Operations - surely the function of Customer Operations should be to ensure that a claim is directed to the right department internally. Surely if a customer writes a letter to HMRC asking for a tax refund because they have failed to claim pension tax relief, and provides the proof this should be sufficient.
The government say that they abhor waste, red tape and inefficiency. Well judging by this example they don't have to look very far to make some significant savings. Or is the real objective simply to make it too damn difficult for the ordinary man or woman on the street to get their money back?
Tuesday, 7 December 2010
What: no box?
For my fiftieth birthday my wife bought me a pair of "made to measure" hand-made shoes from John Lobb of St James's. Entering their shop feels as though you are stepping back in time to something akin to Victorian Britain. Despite being in the centre of London, once you're inside all you hear is the ticking of a large wall clock, and the slow growl of rasps shaping wooden shoe lasts.
Shoe and bootmakers to royalty, the John Lobb shop is a stone's throw from Clarence House and St James's Palace. This John Lobb shop shouldn't be confused with the John Lobb brand now owned by Hermes - The Hermes owned John Lobb sits in Jermyn Street and sells an altogether more fashionable shoe in a very contemporary setting.
A year ago I walked in not knowing what would happen next. I guess I must have had some expectations because my thinking was continually being challenged as I went through their process.
The first thing they did was measure my feet - beforehand I wondered whether they would use a laser system in the same way that people can be measured for bespoke jeans these days. Instead they placed each foot onto a piece of paper, whereon the outline of each foot was traced, and annotated with various measurements and comments. Pen, paper and a cloth tape measure - that was all.
I then selected a style of shoe and the leather I wanted before wandered back out into the street and the 21st century. Was that it? I wandered along the road scratching my head thinking "what happens next"
Nothing much happened for several months, and then I received an email saying my shoes were ready for a first fitting. Excited and apprehensive I made my way to the shop.
Trying them on was like slipping on a pair of your old favourite deck shoes, they were comfortable and went on with no trouble at all. Try as I might I couldn't find fault with them, and there was no reason to send them back for fine tuning. At the time I was slightly disappointed because I was expecting several fitting stages, a bit like a made-to-measure suit. I wanted more faffing about! You know, to give the appearance of greater value for money. Then it was over.
"Leave them with me Sir, we need to keep them to make the shoe trees", and then I left, again scratching my head and wondering what was missing.
Finally a few months later, another email (your shoes are ready for collection) and another trip to St James's. "Care to try them on Sir?" well, OK I suppose so, I thought. And so I tried them on. They fit and they were comfortable. And finally, that was it. Time to pay - luckily my wife was on hand.
After much rustling of paper I was handed my shoes, wrapped in paper like a bag of fish and chips, and popped into a plastic carrier bag. What, no box? No big carboard carrier proudly proclaiming the name of John Lobb, Royal Warrant holders and makers of the world's finest and most expensive shoes. How would I show-off as I wandered around the West End? Scratching my head once again I walked out of the shop and onto the street. The razzamatazz of the big Bond Street brands was a only a short walk away, but it felt a million miles away.
I own a pair of shoes costing as much as two first class return flights from London to New York. There was no limosine service, no complimetary champagne, not even a box to take them home in - yet does it really matter? I'm going to give this some serious thought.
Anyway, my shoes will probably do the same mileage as a return flight to New York - perhaps more! And they're one of a kind (OK they're a pair)and yes I missed the touches that we expect from exceptional service - but did I really miss it, or were my perceptions being challenged - I still don't know.
By the time I arrived home I thought it hilarious. To be given my shoes, among the most expensive shoes in the world, wrapped in paper, and popped in a plastic carrier bag sans box. Well if it's good enough for royalty...
Shoe and bootmakers to royalty, the John Lobb shop is a stone's throw from Clarence House and St James's Palace. This John Lobb shop shouldn't be confused with the John Lobb brand now owned by Hermes - The Hermes owned John Lobb sits in Jermyn Street and sells an altogether more fashionable shoe in a very contemporary setting.
A year ago I walked in not knowing what would happen next. I guess I must have had some expectations because my thinking was continually being challenged as I went through their process.
The first thing they did was measure my feet - beforehand I wondered whether they would use a laser system in the same way that people can be measured for bespoke jeans these days. Instead they placed each foot onto a piece of paper, whereon the outline of each foot was traced, and annotated with various measurements and comments. Pen, paper and a cloth tape measure - that was all.
I then selected a style of shoe and the leather I wanted before wandered back out into the street and the 21st century. Was that it? I wandered along the road scratching my head thinking "what happens next"
Nothing much happened for several months, and then I received an email saying my shoes were ready for a first fitting. Excited and apprehensive I made my way to the shop.
Trying them on was like slipping on a pair of your old favourite deck shoes, they were comfortable and went on with no trouble at all. Try as I might I couldn't find fault with them, and there was no reason to send them back for fine tuning. At the time I was slightly disappointed because I was expecting several fitting stages, a bit like a made-to-measure suit. I wanted more faffing about! You know, to give the appearance of greater value for money. Then it was over.
"Leave them with me Sir, we need to keep them to make the shoe trees", and then I left, again scratching my head and wondering what was missing.
Finally a few months later, another email (your shoes are ready for collection) and another trip to St James's. "Care to try them on Sir?" well, OK I suppose so, I thought. And so I tried them on. They fit and they were comfortable. And finally, that was it. Time to pay - luckily my wife was on hand.
After much rustling of paper I was handed my shoes, wrapped in paper like a bag of fish and chips, and popped into a plastic carrier bag. What, no box? No big carboard carrier proudly proclaiming the name of John Lobb, Royal Warrant holders and makers of the world's finest and most expensive shoes. How would I show-off as I wandered around the West End? Scratching my head once again I walked out of the shop and onto the street. The razzamatazz of the big Bond Street brands was a only a short walk away, but it felt a million miles away.
I own a pair of shoes costing as much as two first class return flights from London to New York. There was no limosine service, no complimetary champagne, not even a box to take them home in - yet does it really matter? I'm going to give this some serious thought.
Anyway, my shoes will probably do the same mileage as a return flight to New York - perhaps more! And they're one of a kind (OK they're a pair)and yes I missed the touches that we expect from exceptional service - but did I really miss it, or were my perceptions being challenged - I still don't know.
By the time I arrived home I thought it hilarious. To be given my shoes, among the most expensive shoes in the world, wrapped in paper, and popped in a plastic carrier bag sans box. Well if it's good enough for royalty...
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