Scrutton Bland Winter Adviser 2019

Workplace Pensions Retirement may be a long way off for

Other considerations likely to affect millennials and young adults Paying off your existing debts: If you have outstanding debts on, for example, credit cards, then you should concentrate on clearing those. The interest rate on credit card debt if you repay the monthly minimum is far higher than any interest on easy-access saving accounts. The only exception to this is student loans. Student loans: Although the general advice to young people is almost always to pay off their debts, in the case of student loans these function more as a graduate tax, with repayments based on how much the person is earning. You are able to pay off the debt early if you wish, but there is no incentive to do so. Child Benefit: Child benefit is paid monthly to all parents from the birth of a child to when they become 16 (or 20 if they are in education or training). If either parent’s total taxable income totals over £50,000 then a tax charge known as the High Income Child Benefit Charge will apply. This also relates to adults if they have a child living with them who is not their own child. Before you commit to any investment product you are strongly advised to get advice from an Independent Financial Adviser. The information above provides an overview of the products and services available to you and should not be used as a guide to investing. For more information please contact james.wright@ scruttonbland.co.uk or tel 0330 058 6559 . Scrutton Bland Financial Services Limited is authorised and regulated by the Financial Conduct Authority, registered number 209451 .

Restrictions: Minimum investment of £1,600 to receive any government top-up. Maximum of £3,000 government top-up, available on properties up to £250,000, or £450,000 in London. How much can be saved into each one per year: You can save up to £1,200 in first month then £200 per month, or £2,400 per year. Other things to bear in mind: Can save into this product until November 2030. The ISA must be used for a deposit by 1 December 2030 to receive the £3,000 government top-up. Ethical Investment Products The kind of funds into which savings providers invest has been of increasing interest to customers, including younger clients. Ethical investments are a range of saving products which go beyond simple financial returns to incorporate the saver’s ethical, social and environmental values into the process. This area is also often referred to as Sustainable and Responsible Investment (SRI). Typically the investment will be placed into company funds which take a responsible approach to environmental, social and governance issues, and which avoid investing in areas such as armaments, human rights abuse and environmental damage. Further independent advice is recommended to determine the specific requirements of the saver.

millennials, but the earlier a person starts saving into a pension the better since every employer is required to contribute to each employee’s pension, and the government will also boost the pension pot in the form of tax relief. Restrictions: Automatic enrolment only applies to employees aged 22 or over. If you are under 22 but earn more than £6,136 (in the tax year 2019-20) you have the right to opt-in to your employer’s scheme and receive employer contributions. If you earn less than £6136 your employer has to give you access to a pension scheme to save into, although they are not required to contribute to it. Other things to bear in mind: If you have opted out of a workplace scheme you have effectively taken a pay cut as you’re unable to receive the employer contributions elsewhere. Online savings only, such as Sbinvest Minimum investment: Varies according to provider: Sbinvest requires £50 savings per month or £1,000 lump sum.

Rates of interest: Varies depending on the saver’s attitude to risk.

Tax implications: An ISA is available for tax free savings, but once savings top £20,000 a General Investment Account will be required.

Premium Bonds (NS&I) Minimum investment: £25

Ease of access: No penalties for withdrawals.

R ates of interest: Nil. Prizes are awarded from a monthly draw. Prizes range from £25 to £1million.

Restrictions: This is a simplified advice investment solution. Independent financial advice should be sought for other investment needs. How much can be saved into each one per year: £20,000 can be saved into an ISA, a General Investment Account up to a further £80,000. Other things to bear in mind: Simplified investment solutions such as Sbinvest are easy to use but don’t offer a full range of investment options, so check if independent financial advice is required.

Tax implications: No tax due on NS&I Premium Bond winnings.

Ease of access: Account holder needs to be 16 years of age.

Restrictions: None.

How much can be saved into each one per year: Maximum total saving of £50,000.

Other things to bear in mind: Winning odds of 24,500 to 1 per £1 Premium Bond. Bonds fully secured by the government.

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