97% of fund managers believe uncontrolled climate change will affect investments

A survey has revealed that the majority of bank and fund managers believe that uncontrolled climate change will impact their investments in the medium term.

Read on to find out how it could affect your finances.

UN: The window for tackling climate change is closing 

In the Paris Agreement in 2015, 195 nations pledged to tackle climate change. The agreement aims to limit global warming to “well below” 2C when compared to pre-industrial levels and to “pursue efforts” to keep warming within a 1.5C limit.  

Scientists have previously warned that crossing the 2C threshold could lead to irreversible changes to ecosystems and the climate. 

However, despite the pledge, the UN warned in 2023 that the window to reach climate goals was closing. A report from the organisation said “much more needs to be done”. 

Exceeding the climate target could disrupt many communities and parts of modern life, which may affect the performance of investments.  

Most bank and fund managers say climate change will impact investments within 5 years

A survey published in FTAdviser asked bank and fund managers how they believe climate change will impact their investments.

The surprising effect your childhood has on your money mindset

Your relationship with money may play a huge role in how you handle financial decisions and your long-term security. Many factors affect your financial decisions, but you might be surprised by how much your childhood experiences still influence you today. 

The majority of parents recognise how important financial education is. Indeed, according to Nationwide, almost 9 in 10 parents to children aged between 8 and 13 say personal finance education would help their children better understand the value of money. 59% also agreed that personal finances were more important than maths. 

Yet, studies suggest these parents might be considering the positive effects of financial education too late.

Research: Money habits could be set by age 7

A 2013 study from Cambridge University indicated that financial habits are formed by the age of seven. The research suggests that children have often formed core behaviours by the age of seven which they will take into adulthood and could affect financial decisions for the rest of their lives. 

4 compelling reasons you might want to consolidate your pension

It’s been more than a decade since auto-enrolment was introduced, and now most workers automatically become members of their employer’s pension scheme. While more people saving for retirement is excellent news, it could mean you end up juggling multiple pots. 

One option is to transfer one pension to another, known as “consolidation”. It’s usually simple to do and there are many reasons why you might want to transfer a pension. However, there are also some potential drawbacks that you may wish to weigh up first. 

Here are four compelling reasons you might want to transfer one pension to another. 

1. It could make it easier to keep track of your savings during your working life

With each job potentially providing you with a pension, the number of pots you might need to manage could become overwhelming during your working life.

Why “safety in numbers” might not apply to investing

Being part of a group can make you feel like you’re less likely to fall victim to a mishap or other negative event. While the hypothesis might be true in some circumstances, the opposite may be said when you’re investing. Read on to find out why failing to follow the crowd could be a good thing.

The inclination to be part of a large group and adopt the behaviours of people around you is sometimes referred to as “herd mentality”. Following the same route as other people can give you a sense of security and help you feel as though you’re making the right decisions. After all, you might think: they can’t all be wrong, can they?

Yet, financial decisions should often be based on your circumstances. So, a safety-in-numbers approach could have the opposite effect and harm your long-term finances.

A fear of missing out could lead to you following the crowd

There are lots of ways that a herd mentality might affect your investment decisions, including a fear of missing out.

Uncertainty drives record numbers to take out income protection. Here’s what you need to know

Figures from the Association of British Insurers (ABI) suggest a record number of families are taking out income protection to create a safety net. Read on to find out how income protection works and whether it could be valuable for you.

Income protection would pay out a regular income if you were unable to work due to an accident or illness. As a result, it could provide you with a way to keep up with your financial commitments if your income unexpectedly stops. Income protection will normally continue to pay an income until you’re able to return to work, retire, or the term ends.

Usually, the sum provided through income protection is a proportion of your regular salary, such as 60%. You’ll need to pay a monthly premium to maintain the cover, the cost of which will depend on a range of factors, such as your age and lifestyle.

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