ISAs have been around for more than two decades, but they’ve changed significantly since they were first introduced. This guide can help you understand why using an ISA to save or invest could be a valuable part of your financial plan.

Read the guide to find out:

  • Why ISAs are a tax-efficient way to save and invest
  • Discover the different types of ISA you can choose from
  • What you should consider when deciding if you should save or invest through an ISA
  • How Junior ISAs could help you build a nest egg for children or grandchildren
  • How you could leave your ISA to loved ones when you pass away.

Download your copy of “The essential guide to ISAs” to understand why around 12 million adults contribute to their ISAs each year.

If you have any questions about the topics covered in the guide, please contact us. We can help you manage your savings and investments in a way that reflects your goals, including ISAs if they’re appropriate for you.

A phone with TED on the screen.

Learn tips that could improve your mindset and help you reach your goals with these popular TED talks.

TED started as a conference where ideas about technology, entertainment, and design converged in 1986. Today, the online platform boasts a huge number of talks covering numerous topics, from behavioural economics to medical research. Since first posting online in 2007, TED has become an excellent place to listen to experts, hear different points of view, and find inspiration.

Here are some of the most-watched TED talks from the last 30 years you should add to your playlist.

1. How great leaders inspire action

Leadership expert Simon Sinek shares his simple approach for inspirational leadership.

He explains why some companies and people can achieve things that “defy all the assumptions” and argues that focusing on “why” is important. Understanding why your organisation exists or why you get out of bed in the morning can improve communication. Among the varied examples Sinek draws on to support his model are Apple and Martin Luther King Jr. 

If you have a leadership role, taking 20 minutes to listen to this TED talk could change your approach and lead to better results.

2. Inside the mind of a master procrastinator

Do you often find that you’re reading the news or Wikipedia when you should be completing an unrelated task? Or that a five-minute break to watch a video on YouTube has led you down a rabbit hole? In this funny and insightful talk, Tim Urban discusses his habit of waiting until the last minute to get things done.

The talk encourages you to think about what you’re procrastinating on and whether it’s a task you can afford to put off. Urban highlights how time can pass you by, so being aware of what’s important to you is a job that you should start today.

3. How to speak so that people want to listen to you

Effective communication is vital in your professional and personal life. If you’ve ever felt like no one is listening when you’re talking, Julian Treasure offers some tips and simple vocal exercises that can make your speaking more powerful.

The talk highlights the things you should avoid when speaking, from negativity to exaggeration. It then explains how to increase the power of your speaking and how your delivery affects the meaning of your words.

Embracing some of the tips can help you feel more confident next time you need to deliver a pitch, approach someone new, or even deliver an amusing anecdote to your friends.

4. What makes a good life? Lessons from the longest study on happiness

Robert Waldinger was the director of a 75-year-old study on adult development. During his research, he’s learnt some things about what leads to a happy, fulfilling life. In this talk, he shares three life lessons from the study.

When speaking to young adults, the study found that 80% said becoming rich was a major life goal, and 50% wanted to become famous. Yet, the study that tracked lives over decades found that it’s good relationships that keep people happier and healthier.

So, listen to this talk to discover three big lessons about relationships and why they’re so important for your long-term happiness.

5. The puzzle of motivation

What motivates you or the team you manage? Career analyst Dan Pink believes that traditional rewards aren’t as effective as you may think.

He argues that incentives like bonuses and commissions block creativity and dull thinking. Yet, it’s still a common approach to motivating employees. Instead, Pink puts forward an alternative that focuses on three different elements – autonomy, mastery, and purpose.

This insightful talk could change the way you set out your own goals as well as motivate others that you lead.

6. How to make stress your friend

Stress is something that everyone experiences, but how we respond to it can change the effect it has. Psychologist Kelly McGonigal urges you to see stress as something that could be positive.

While stress has been linked to poor health, she argues that it’s the belief that stress is bad for you that has a harmful effect. Changing your mindset about stress could improve your wellbeing, she says. In one example she explained that common signs of stress, such as your heart pounding or breathing faster, can also indicate that your body is energised and preparing to meet a challenge.

Knowing how to handle stress can mean you can overcome obstacles and doubt to reach your goals. 

A couple watching a film on a home cinema screen.

Given that energy prices have soared, it’s not surprising that energy efficiency measures have become essential to homeowners. However, a survey found some trends that you might not expect and it could change how you view your property if you’re thinking about updating it.

According to Halifax, almost half of homeowners want to make improvements to their property within the next few years. So, what should you focus on? 

According to 62% of people, a good Wi-Fi connection is essential. It’s easy to see why this would be important. Whether you’re working from home, enjoying streaming a TV show, or connecting with family and friends, you’ll often be using the internet. 

Another unsurprising must-have is energy efficiency measures, which 58% of people said were crucial. Over the last year, household energy bills have soared for many families. So, cost-cutting measures, like insulation, energy-efficient appliances, or renewable energy sources could save money in the long run.

Considering energy efficiency could also make your home more attractive if you want to sell it in the future.

Separate research from Legal & General suggests that potential buyers would be willing to pay a premium of up to 10.5% for a low-carbon home. Demand is growing too; searches for mortgages that consider the Energy Performance Certificate (EPC) rating, which measures a property’s energy efficiency, increased by 34% in July 2022.

So, while energy-efficient measures can be costly to install initially, they could pay you back through lower energy bills and potentially a higher sale price.

Making spaces functional with a utility room (40%) and study space (27%) has also become more popular. If you’re thinking about updating the layout of your home or how you use different rooms, giving each space a designated purpose could be useful.

5 upcoming trends that could make your property more attractive

As well as the must-haves you’d expect to find in a home, the survey uncovered upcoming trends that some homeowners already consider essential features.

  1. Home cinema: 1 in 10 homeowners want to watch the latest box set or film in style with a home cinema set up.
  2. Boiling water tap: Kettles are deemed too slow for 9% of people, who believe a boiling water tap is now a must-have kitchen gadget.
  3. Dressing room: If you have a spare room, turning it into a dressing room could make your home more attractive, as 7% consider this additional space to be a must-have. However, losing a bedroom or storage could reduce the value of your property too.
  4. Home gym: 7% of homeowners don’t want to pay for a gym membership and consider a home gym essential for improving their health and fitness.
  5. Hot tub: Perhaps surprisingly given rising energy prices, 3% of homeowners believe that a hot tub is a must-have feature for their home.

Don’t forget about your garden: A quarter of potential buyers say a beautiful outdoor space could tempt them

When updating your property, don’t forget about the outside.

Gardens and outdoor spaces became a key feature during Covid-19 lockdowns when families couldn’t go out. The Halifax survey suggests that gardens are still an important part of creating the perfect home. In fact, 26% of people said a beautiful garden could convince them to buy a property they may otherwise discount.

There are two key features that prospective buyers focus on:

  1. Grass: While grass can require work to maintain, the survey found that almost half (47%) of people say it’s their preference and would choose it over artificial options or paving.
  2. Outdoor building: Whether a shed that’s handy for storage or an outbuilding that’s perfect for entertaining, 33% of people consider an outdoor building an important feature.

Gardening has plenty of benefits. As well as giving you an outside space to enjoy, it can be great exercise and provide a mental health boost too. However, if you’re hoping to sell your home, be cautious of creating a high-maintenance plot – 47% of people said it’d put them off a property.

Contact us to talk about your home

Whether you want to create a beautiful home to live in or are getting ready to move, we could help.

In some cases, you could borrow more against your home through your mortgage, which you could use to turn your property into your dream home. If it’s something you’re thinking about, we could help you understand the long-term cost, find a lender that’s right for you, and offer support throughout the application process.

If you’re planning to move, we’re also here to help you find a mortgage for your new property. Please contact us to arrange a meeting.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.

Think carefully before securing other debts against your home.

Two women talking while drinking coffee.

This year’s theme for International Women’s Day is “embrace equity”. While huge strides have been made in improving financial independence for women, there’s still a significant gap. It could harm your overall wellbeing and your options in the future.

If you want to take steps to improve your long-term financial security, there are things you can do now.

1. Don’t overlook your pension

Your pension is often important for financial security later in life. A report from Royal London suggests that pensions are something just 12% of women feel very confident about, compared to 21% of men.

The research also found that women are more likely to be concerned about a range of retirement challenges, including running out of money during their lifetime and not leaving a legacy.

Taking the time to understand your pension and how it’ll grow during your career could help put your mind at ease. It’s also a process that could help you identify a potential shortfall sooner and mean you have more time to bridge a gap if necessary.

One of the reasons women often have less in their pension when compared to men is that they’re more likely to take career breaks. Even if you’re not auto-enrolled into a pension by an employer, you can continue making contributions to either an existing pension or a new one.

If you pause pension contributions, you should still review your savings. It can help you understand how your pension investments are performing and whether you’re on track to reach your long-term goal.

2. Review your State Pension

As well as your retirement savings, the State Pension is often crucial later in life. As it will provide an income from when you reach the State Pension Age, it can provide some certainty and help you cover essential outgoings.

On average, women receive less from the State Pension than men. According to government figures, men that have retired since 2016 received an average of £160.09 from the State Pension in 2022/23. For women, this falls to £152.90.

How much you receive from the State Pension depends on your National Insurance contributions (NICs). Women are more likely to take a career break or work part-time for a variety of reasons, such as raising children, which could affect their NICs.

Usually, you will need 35 qualifying years on your National Insurance (NI) record to be eligible for the full State Pension. If you have fewer years, you’ll usually receive a proportion of the full amount.

You can check how many years are on your NI record and how much you could receive from the State Pension by using the government’s State Pension forecast tool. This can help you understand how much you’re likely to receive when you retire and fill potential gaps.

As well as checking your NI record, you should also check if you’re entitled to benefits that could boost your NI qualifying years. For instance, if you apply for Child Benefit and your child is under 12, you’ll automatically receive NI credits, even if your family isn’t eligible for financial support. It’s a step that could improve your financial wellbeing later in life.

3. Understand when to save and invest

Research from the Royal Mint suggests there is a gender gap when it comes to investing. The findings indicate that women are more risk-averse and feel less confident about their investment knowledge.

26% of women said they invest regularly, compared to 53% of men. If you have long-term goals, investing could provide you with a way to grow your wealth over a long time frame. With women less likely to invest, it could mean that many are missing out on potential returns by opting for cash accounts instead.

If your saving goal is more than five years away and your financial position is secure, considering investing could make sense. While returns cannot be guaranteed and investing involves risk, you can invest in a way that matches your risk profile. It could help you get more out of your money.

4. Review your finances when your circumstances change

Taking stock of your finances when your circumstances change can help ensure you remain on track. From changing careers to having children, many life events can affect your finances as well as your priorities.

By reviewing your finances regularly, you can identify potential challenges or opportunities.

One example of why reviewing your finances is important is that women are often negatively affected financially when a relationship breaks down.

The Royal London study stated that women typically walk away from divorce “substantially worse off” than men, especially when pensions are considered. A divorced man aged 45–54 on average has pension wealth of £42,000, compared to £16,000 for women. This is often because a pension is not viewed as a joint asset, but a review could highlight where women are missing out.

5. Book a meeting with a financial planner

Seeking professional advice throughout your life can be valuable and it could help you make the most of your assets. It can help you understand the steps you need to reach your goals as well as things like how you could reduce your tax bill.

The Royal London report suggests that men are more likely to discuss money matters with third parties. For instance, while 73% of men would discuss their money with a financial institution, 66% of women said the same. It could mean some women are missing out on advice that could improve their financial wellbeing.

Booking a meeting with a financial planner allows you to ask questions, understand if you’re on track, and create a tailored plan that considers your goals. Please contact us to arrange a meeting.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future results.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. 

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Father and adult son talking.

Are you worried about Inheritance Tax (IHT) or how you’ll pass on your wealth to loved ones? For some people, pensions can provide a way to tax-efficiently leave wealth to family. Here’s what you need to know.

While IHT currently affects around 1 in 20 estates, it’s a concern for many families. As key IHT thresholds are frozen, it’s something that more people will need to consider as they plan how to pass on their assets.

For the 2023/24 tax year, the nil-rate band is £325,000. If the value of your estate is below this threshold, no IHT will be due. It has been at this level since 2009/10 and is frozen until 2027/28.

In addition, if you leave property to your children or grandchildren, the residence nil-rate band could increase how much you can pass on before IHT is due by up to £175,000 in the 2023/24 tax year. This allowance is also frozen until 2027/28.

So, you may be able to pass on up to £500,000 before you need to consider IHT. You can also pass on unused allowances to your spouse or civil partner.

As inflation means the value of your estate could be rising, IHT may be something you should think about even if your estate isn’t currently exceeding the threshold. The standard rate of IHT is 40%, so it could significantly reduce the wealth you leave behind. However, there are steps you can take to reduce a potential IHT bill, including making your pension part of your estate plan.

Crucially, money that remains in your pension isn’t considered part of your estate when calculating IHT.

The topic has recently been in the news after the Institute for Fiscal Studies called for the government to end the “overly generous” tax treatment of pensions at death. The organisation believes that pensions should be included in IHT calculations so that the tax is spread evenly across all forms of wealth.

Here’s what you need to know about pensions and tax.

What tax will your pension be liable for when you pass away?

While a pension is usually considered outside of your estate for IHT purposes, that doesn’t automatically mean there will be no tax due. How much tax your beneficiary could pay will depend on:

  • The age you pass away
  • Their other income
  • How they access the savings.

Usually, if you pass away before you’re 75, your loved one will not need to pay tax whether they choose to take a lump sum, purchase an annuity, or flexibly access the savings. However, there are exceptions. For example, if the value of your pension exceeds the Lifetime Allowance, which is £1,073,100 for the 2023/24 tax year, a lump sum withdrawal would be liable for a 55% charge, while purchasing an annuity or taking a flexible income would lead to a 25% penalty.

If you pass away after the age of 75, the beneficiary will usually have to pay Income Tax on withdrawals. So, it’s important that you consider other income they have, from a salary to interest from savings, and the rate of Income Tax they pay.

Your beneficiary should also consider how their decisions could reduce their tax liability. Spreading out withdrawals across several tax years can make sense to avoid moving into a higher Income Tax band, for instance.

3 practical things you should do if you want to pass on your pension to loved ones

1. Only withdraw money you need from your pension

Your retirement savings are only considered outside of your estate for IHT purposes if they remain in your pension. So, if you want to pass your pension on to loved ones, you should manage your withdrawals.

Think about only withdrawing the income you need from your pension flexibly and leaving the remainder where it is. As well as making sense for IHT purposes in some cases, this approach means your savings could continue to be invested tax-efficiently and potentially grow further throughout your retirement.

2. Talk to the potential beneficiary

If you leave your pension to your loved one, how much tax they’ll be liable for could depend on their income from other sources and how they plan to access the money. As a result, it’s worth having a conversation with the potential beneficiary about how they’d use the asset. It could help them get more out of the legacy you leave behind.

3. Complete an expression of wishes

As your pension isn’t normally covered by your will, you must complete an expression of wishes to state who you’d like to receive your pension savings.

An expression of wishes isn’t legally binding, but it’s still an important document. When you pass away, the pension scheme trustees or administrator will use it to decide what should happen to your remaining pension.

If you have more than one pension, make sure you complete an expression of wishes for each one.

Contact us to talk about your pension and Inheritance Tax

While the government hasn’t responded to the calls for change around pensions and IHT, it’s important to remember that legislation can change. Working with a financial planner can help ensure that your plan continues to reflect current rules.

If you’d like to discuss what you can do to reduce a potential IHT bill or your options when accessing your pension, please contact us.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The Financial Conduct Authority does not regulate tax planning.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

A woman sitting at a table with a laptop

If you’re saving into a defined contribution (DC) pension, you can choose how you access the money. You’ll also be responsible for ensuring the savings provide you with an income for the rest of your life, so understanding the different options available to you is crucial.

Most workers saving for retirement will have a DC pension. This is where your pension contributions, along with those made by your employer and tax relief, are added to a pot. This pot is then typically invested with the goal of delivering long-term growth.

Pensions are often invested through a fund that pools together your savings with that of others. You can usually choose from a selection of funds, but you won’t need to make day-to-day investment decisions.

When you retire, your pension will hold a sum of money that consists of contributions made throughout your working life and investment returns. But how do you turn this pot of money into an income? You usually have three main options, and each has its pros and cons.

1. Purchase an annuity

Annuities were once a common way to turn a pension pot into an income. However, they fell out of favour when the government introduced Pension Freedoms in 2015. Yet, rising annuity rates and uncertainty due to high levels of inflation mean they’re becoming more popular again.

An annuity is an insurance product that you buy, often with savings in your pension. It will then provide a reliable income for the rest of your life. As a result, it can be a useful way to create financial certainty, as you don’t run the risk of running out of money in your later years.

You can choose an annuity that rises in line with inflation to protect your spending power throughout retirement. You may also choose to purchase a joint annuity, which would continue to provide your partner with an income if you pass away.

How much you’d receive from an annuity will depend on the annuity rate. So, reviewing different options if you decide an annuity is right for you is essential.

2. Use flexi-access drawdown

If you’d prefer to be in control of your income, flexi-access drawdown is an option.

Typically, money held in your pension will remain invested and you can adjust the income you receive from it. For example, you could increase or decrease your income to suit your needs. As your savings are often invested, they have the opportunity to continue to grow further. However, keep in mind you will be exposed to investment risk and returns cannot be guaranteed.

You’ll also need to be mindful of how long your savings will need to last. Taking too high an income at the start of retirement could mean you run out later. If you’re using flexi-access drawdown you should feel confident about the income you’re taking and its sustainability.

3. Withdraw lump sums

Another flexible option is to take lump sums from your pension as and when you need to. This could be useful if your pension is supplementing other sources of income.

As with flexi-access drawdown, what remains in your pension will usually be invested. You could also choose to take your entire pension in one lump sum.

However, you should keep in mind that pension withdrawals could be liable for Income Tax. So, you could face a large bill if you withdraw a significant lump sum.

You don’t have to pick a single option

You don’t just have to pick one option either, you can mix and match to create a plan that suits you.

So, you could choose to take a lump sum out of your pension when you first retire. This could help you pay for one-off costs, like updating your home, or experiences, such as travelling the world.

You may then use a portion of what’s left to purchase an annuity to provide a base income that covers your essential outgoings. The remainder you could access flexibly to supplement your income when you need it.

What’s important is that you consider your income needs throughout retirement and ensure you have a sustainable income to provide security in your later years. Arranging a meeting with a financial planner can be valuable and help you create a long-term plan that matches your goals.

How a financial planner could help you in retirement

It can be difficult to know which option is right for you. The decisions you make at the start of retirement could affect your financial security for the rest of your life, and tailored financial advice can give you peace of mind.

We’ll work with you to set out what you want to get out of retirement and how your pension could help you achieve this. As well as understanding how to access your DC pension, a financial planner could also help you:

  • Set out your long-term goals
  • Understand and minimise tax when taking income from your pension or other assets
  • Assess how to use other assets, like investments or property, to support your retirement goals
  • Have confidence that you could weather financial shocks
  • Create a plan to pass on assets to loved ones during your lifetime or when you pass away.

If you’re nearing retirement and have questions or would like to discuss your options, please get in touch.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future results.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. 

A couple laughing together as they eat al fresco.

When you think about retirement planning, what challenges come to mind? While ensuring you have enough saved and that you don’t run out of money are common concerns, there is one you may have overlooked: changing from a saving to a spending mindset.

To secure your retirement, putting money away has likely become a habit that you’ve embraced for decades. Perhaps you contributed to a pension, made sure your mortgage was paid off, or invested with a long-term plan. These positive habits could have helped you towards greater flexibility and more security later in life.

However, once you retire, it’s not just your routine that changes – your relationship with money may do too.

Rather than building up assets, you’ll often start to deplete them. You may take an income from your pension and use other assets as well. While a happy retirement is what you’ve made sacrifices for in the past, it can be more difficult than you think to start spending the nest egg you’ve created.

Not switching your mindset could mean that despite efforts during your working life to build the retirement you want, it falls short of expectations, even if you have the finances to reach your goals.

So, how can financial planning help you change your mindset when you retire?

Financial planning can help you understand what lifestyle you want

When you think of financial planning, it’s probably the money side of things that come to mind first, like managing investments or highlighting potential tax allowances. This is an important part of financial planning, but it’s not the whole picture.

Effective financial planning starts with understanding what you want to achieve. For those at retirement, focusing on what you want your lifestyle to look like once you give up work is an essential part of the process. Do you envision yourself travelling the world, retiring by the coast, or spending time on hobbies?

Setting out what makes you happy can mean you feel more comfortable depleting your assets. Yet, a report from Aegon finds that just 1 in 5 people are very aware of the day-to-day experiences that give them joy and purpose. As you get ready for retirement, it can be a useful exercise to think about what you’re looking forward to.

It’s only once you set out your goals that the financial planning process starts to look at how your assets and actions can help you reach them.

A long-term financial plan can give you the confidence to deplete your assets

One of the reasons why retirees are often reluctant to deplete assets is that they worry they’ll run out of money. It’s a sensible concern – the decisions you make at the start of retirement could affect your finances for the rest of your life.

Yet, spending too little during your retirement could mean you miss out on experiences.

A survey from abrdn found that almost half of retirees worry that they’ll run out of money during their lifetime. Despite this, only 1 in 5 people are seeking professional financial advice. A financial plan that’s been tailored to you can give you confidence that you’re financially secure.

A financial plan can help you understand what income is sustainable by considering a range of factors, from longevity to inflation. It can also allow you to voice concerns, such as how you’d cope if investment performance didn’t meet expectations or you needed care later in life, and create a safety net if necessary.

A financial plan will consider the assets you want to leave for loved ones

As well as your own financial security, you may be worried about that of your loved ones. Perhaps you worry that depleting assets now will mean you don’t leave an inheritance to your children or grandchildren.

An LV= survey found that 88% of people hope to leave money to their family in their will. A financial plan can also ease your mind here. A financial planner can help you understand how the value of your assets could change during your retirement and how to effectively pass on wealth to the next generation.

Contact us to talk about your retirement goals

If you are nearing retirement or have already retired, please get in touch. We can work with you to create a financial plan that suits your goals and gives you the confidence to use the assets you’ve built up during your working life.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The value of your investments (and any income from them) can go down as well as up, which would have an impact on the level of pension benefits available.

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances. Levels, bases of and reliefs from taxation may change in subsequent Finance Acts.