ISA season tax-free saving rewards from Foresters Friendly Society

ISA season is upon us and as investors rush to make the most of their tax-free allowance, Foresters Friendly Society, the mutual provider, will be offering an M&S Gift Card up to the value of £300 for those who apply online by midnight, Friday 5th April 2019.

Foresters has a wide range of offers for consumers who open one of their popular Tax-Exempt Savings Plans (TESP), Child Tax Exempt Savings Plans (CTESP), Junior ISA, Stocks & Shares NISA or Lifetime ISA products by the end of the tax year (5th April).

The deals, which are available exclusively via the Foresters website, offer an M&S Gift Card of up to £300 depending on the value of monthly or lump sum contributions and the duration that the savings are invested.

Paul Osborn, Chief Executive for Foresters Friendly Society commented: “The internet is full of money saving tips and tricks, and for savvier savers the end of ISA season can be a lucrative occasion. Now is the perfect opportunity for those who’ve yet to take advantage of their ISA allowance to do so and take advantage of our M&S Gift Card offers, just by opening an account. It only takes a few clicks to set up a savings plan which will bring lasting value, either to themselves or a loved one.”

For further information and full terms and conditions for the Tax-Free Savings Plans M&S Gift Card offer please visit: www.forestersfriendlysociety.co.uk/giftcard

What kind of ISA is right for you?

How to choose the best ISA for you

Like standard savings accounts, there are several types of ISAs on the market today. This guide takes a closer look at the different types along with the questions to consider when choosing the right ISA for you.

Why do you want to save?

The first step is to think about your motivation for saving. What are your goals? Are you saving for something short term or long term? Do you want to save money every month, every year or simply as a one-off? Think about whether you’ll need regular access to your money or whether you want to lock it away. If you’re saving up for something specific like a house deposit or your retirement, you’ll be pleased to know there’s an ISA specifically designed to help.

To find out more about ISAs, get a free copy of our Beginners Guide.

How comfortable are you with risk?

There are two main types of ISA: Cash ISAs and Stocks & Shares ISAs.

Cash ISAs work much the same as a savings account, whereas Stocks & Shares ISAs invest your money in a number of different assets with the aim of growing your money over the longer term. Unlike a Cash ISA your investment in a Stocks & Shares ISA could go down as well as up, however it can offer the potential for higher returns.

So, before you choose an ISA you need to decide whether you are looking to save or invest.

If you feel OK about balancing risk with the opportunity of growth you might want to consider investing in a Stocks and Shares ISA. If you don’t like this idea, you might prefer to save in a Cash ISA instead.

Find out whether you’re a risk-taker by taking our quiz or learn more about choosing between a Cash ISA and a Stocks and Shares ISA here.

What types of ISAs are available?

Cash ISA

  • What is a Cash ISA? A Cash ISA is the most basic kind of ISA in which you can deposit cash, and the interest is paid tax-free.
  • Who’s it for? Savers aged 16+ who prefer lower risk saving
  • How does it work? You can pay in up to £20,000 in the current 2018-19 tax year and the interest won’t be taxed.

Stocks and Shares ISA

  • What is a Stocks and Shares ISA? Also known as an Investment ISA, a Stocks & Shares ISA is an investment account where any returns you get will be free from tax.
  • Who’s it for? Savers over the age of 18 who are comfortable balancing risk with the opportunity for growth.
  • How does it work? You can put in a maximum of £20,000 in the current tax year. Instead of simply saving your money, you’re investing it in things like stocks and shares, bonds, gilts or commercial properties, to help your savings grow over several years. But depending on how the stock market performs, the value of your investment could go down as well as up and there’s a risk you may get back less than you put in.

Innovative Finance ISA

  • What is an innovative Finance ISA? This ISA lets you use the money in your ISA to invest in the peer-to-peer lending market.
  • Who’s it for? Savers over 18 who are comfortable balancing peer to peer investment risk with the opportunity for better growth.
  • How does it work? Peer-to-peer lending brings borrowers and lenders together. Because there are no bank fees you could get higher returns but individuals aren’t regulated in the same way as financial institutions so the risks can be higher. The IFISA contributes towards your current 2018/19 £20,000 ISA allowance.

Different types of ISAs have also been created to help you save for specific things.

Lifetime ISA – saving towards your first home or retirement

  • What is a Lifetime ISA? This ISA is designed to help you save towards purchasing your first home, or to save towards your retirement, with government help.
  • Who’s it for? For people aged between 18 and 39 who are saving for their first home, which costs less than £450,000, or who are saving towards their retirement from aged 60.
  • How does it work? You can currently put up to £4,000 into a Lifetime ISA each year, then the government tops up your savings with 25% of what you’ve saved that year (up to a total of £1,000). You can pay into a LISA up until your 50th birthday, and unless you are using the money as a deposit for your first home, you will need to wait until you’re 60 to access your savings. You are still able to cash it in for other reasons, but in most cases this would incur a 25% government charge, applied to the whole amount of your withdrawal.

Help to Buy ISA – saving towards your first home

  • What is a Help to Buy ISA? This ISA is designed to help you save for your first home and also has government help.
  • Who’s it for? People over the age of 16 saving for a home.
  • How does it work? You can use a Help to Buy ISA for any property, as long as it is worth less than £250,000 (£450,000 if the property is in London). The allowance works slightly differently in that you can save up to £1,200 in the first month when you open a Help to Buy ISA and up to £200 a month after that.
  • Similar to the Lifetime ISA, the Government adds a 25% top up on contributions, however there are minimum and maximum top up amounts available. You’ll need to save at least £1,600 to receive the minimum top up of £400, and £12,000 for the maximum £3,000 top up.
  • Help to Buy ISAs are available until December 2019, and the bonus will be applied as long as you purchase your first home by 2029.

Junior ISA – saving for your childs future

  • What is a Junior ISA? This ISA is designed to help families save for their children’s future.
  • Who’s it for? Children under 18 years old.
  • How does it work? You can pay up to £4,260 (in the current 2018/2019 tax year) into your child’s Junior ISA. The child can take control of a Junior ISA when they turn 16, but they cannot withdraw money from the account until they are 18.

Can I switch ISA providers?

As well as opening a new ISA, it’s also possible to transfer your existing ISAs to a new provider providing they accept transfers. Never withdraw the funds and transfer them yourself doing so will count towards your ISA allowance for the new tax year, speak to your new ISA provider about this.

To find out more about ISAs, get a free copy of our Beginners Guide.

The content of this article is for information purposes only and does not constitute financial advice. We do not offer financial advice. If you’re unsure as to the suitability of a product you should seek advice from a Financial Adviser. You may have to pay for this advice.

Junior ISA tax deadlines for 2018/2019

If you would like to start a Junior ISA, or if you already pay into one for your child or grandchild, don’t forget to open or top up the account before 5 April 2019 if you want to make the most of the tax-free savings allowance for the 2018/2019 tax year.

How much can I invest in a Junior ISA?

Each tax year there is a maximum amount of money you can save into your Junior ISA. For example, during the 2018/2019 tax year, the savings limit for a Junior ISA is £4,260 and this will increase to £4,368 in 2019/2020. So you can save up to a maximum of £4,260 through regular payments, lump sum payments and top ups into your child or grandchild’s Junior ISA up to 5 April 2019 before the new allowance starts on 6 April 2019.

Can I carry my Junior ISA allowance into a new tax year?

The tax year runs from 6 April in one year to 5 April the following year and your allowance refreshes at the start of each tax year. Any allowance which isn’t used by the end of the tax year will be lost, and cannot be carried through to the following tax year or added to your new allowance.

Who can contribute to a Junior ISA?

Here at Foresters Friendly Society, our Junior ISA is a great way to put money aside for your child’s future whether saving regularly or investing a lump sum each year. As a parent/guardian of the child you can stop, start and change the level of contributions at any time during the year, and once opened anyone (such as parents, grandparents, relatives etc.) can pay into the account. You could even encourage your child to make their own contributions using their pocket money to get them into the habit of saving for the future.

The money you invest in our Junior ISA will be invested in our with-profits Order Insurance Fund, which offers the potential for higher returns than a cash ISA and has less risk than would be associated with a Junior ISA that is invested solely in stocks and shares. Once your child turns 18, they will then be able to access their Junior ISA which can then be invested in an adult ISA, or used for anything from their education to buying their first car.

If you’re interested in opening a Junior ISA for your child and want to find out more about how it works then request an information pack today!

You should be aware that in some investment conditions your child may not get back the value of the original investment. Tax rules may change in the future and depend on individual circumstances. Inflation will affect what your child can buy when they cash-in their Junior ISA.

This blog is intended to provide information, not financial advice, to help you make an informed decision about savings and investments. We do not offer financial advice. You should contact a financial adviser, who may charge a fee, if you want financial advice.

How to open a Junior ISA in the 2018/2019 tax year

If you are thinking about starting a savings account so you can put aside money for your child’s future, you may be considering a Junior ISA (JISA). These accounts are long-term, tax-free savings for children, which they will have access to when they turn 18.

When it comes to opening a Junior ISA, there are some conditions that need to be followed, so we’ve put together an easy guide for you to see if your child would be eligible.

Who can open a Junior ISA?

A Junior ISA can be set up by a parent or guardian, registering their details as the primary contact until their child turns 16.

Your child must live in the UK and be under the age of 18. If your child is living outside of the UK, you can only open a Junior ISA if they depend on you for care or you are a Crown servant.

Children aged 16 or 17 can open a Junior ISA themselves.

What if my child already has a child trust fund?

If your child already has a child trust fund, they won’t be able to open a Junior ISA at the same time, however you can ask your chosen provider if you can transfer your child’s trust fund to the Junior ISA.

What if my child already has a Junior ISA?

If your child already has a Junior ISA with another provider, you can transfer to the Foresters Junior ISA. You should check any conditions your existing provider may have but we can manage the transfer on your behalf making it easier and quicker for you.

How to open a Junior ISA with Foresters Friendly Society

Here at Foresters Friendly Society, you can open a Junior ISA with a lump sum of £500 or set up a direct debit from £10 a month to make regular payments.

You can also top up the account as and when you want. During the current tax year 2018/2019, the saving limit for a Junior ISA is £4,260 which needs to be used by the 5 April 2019 before this year’s entitlement ends and the allowance refreshes to £4,368 for the next tax year.

Anyone (such as Parents, Grandparents, and Relatives etc.) can contribute to the account’s funds, but no one can access the savings. As the child’s parent or guardian, you will manage the account until they turn 16, at which point they can then take control. Once your child turns 18, they will then have access to the funds to either reinvest into an adult ISA or spend as they please.

If you’re interested in opening a Junior ISA for your child and want to find out more about how it works then request an information pack today!

You should be aware that in some investment conditions your child may not get back the value of the original investment. Tax rules may change in the future and depend on individual circumstances. Inflation will affect what your child can buy when they cash-in their Junior ISA.

This blog is intended to provide information, not financial advice, to help you make an informed decision about savings and investments. We do not offer financial advice. You should contact a financial adviser, who may charge a fee, if you want financial advice.

3 things to consider when choosing a Junior ISA in the 2018/2019 tax year

If you are thinking about saving for your child’s future by opening a Junior ISA and are not sure where to start, here is a short checklist of points to consider, to help you along the way.

How long would you like to save for?

You should consider the length of time you will be saving for versus how much you can regularly put away each month or year. The younger your child is when you open a Junior ISA, the more time you will have to reach your savings goal for them.

Which type of Junior ISA is right for you?

Junior ISAs are available as Cash ISAs or Stocks & Shares ISAs and the maximum amount you can invest during the current 2018/2019 tax year is £4,260.

Here at Foresters Friendly Society, our Junior ISA is invested in our with-profits Order Insurance Fund which entails less risk than a Junior ISA that is invested solely in equities since the money is invested across a balanced mix of assets including property, government bonds, and equities. It also offers the potential for higher returns than a cash ISA but has higher risk associated with it. You should also be aware that depending on investment conditions you may not get back the value of your original investment and that inflation will affect what your child can buy when they cash-in their Junior ISA.

Find out more about with profits in this short video:

Have I left it too late?

A Junior ISA can be opened for a child until they turn 18 so it may not be too late to start saving for their future, no matter how big or small. Even if your child is 13 and you put away £50 per month, it would amount to £3,000 before any growth or returns. This could help them with anything from learning to drive to paying towards the costs associated with higher education. Children aged 16 and 17 can open a Junior ISA themselves.

If you’re interested in opening a Junior ISA for your child and want to find out more about how it works then request an information pack today!

Tax rules may change in the future and depend on individual circumstances.

This blog is intended to provide information, not financial advice, to help you make an informed decision about savings and investments. We do not offer financial advice. You should contact a financial adviser, who may charge a fee, if you want financial advice.