Savings. They’re not just for the sensible.
Friday, February 10, 2017
There are few things more satisfying than a savings plan.
Let’s face it, we’ve all got future goals. From the little things we’ve always promised ourselves to the landmark life events we need to plan ahead for. House deposits are needed. Daughters get married. Children grow up and go to university – and all these things cost money. Lots of it. Just as a for-instance, Brides Magazine put the cost of the average wedding at a whopping £30,111.
Hang on a minute; over £30K? Let’s think about that for a second. That’s enough to buy a classic sixties Jag isn’t it? A swimming pool for your home. A round-the-world cruise (one where you actually get a window). Haven’t you devoted decades of expenditure to your little darlings already? Isn’t it payback time for you?
The delightful dilemma
Once you really get stuck into saving, this can become quite an enjoyable quandary. You start to see your money building up, and your imagination grows with it.
And it’s not just confined to big ticket items. For instance, you know the loft needs re-lagging, when suddenly that new tablet catches your eye. Next minute you’re thinking, why fork out for something you can’t even see?
But while you’re busy being pulled this way and that – angel on one shoulder whispering “270mm is the new recommended insulation thickness”, devil on the other murmuring “your old 100mm lagging is fine” – choosing the best way to build your savings could prove less of a difficult decision.
An ISA (or Individual Savings Account), for example, is a way of saving where your money can grow tax-free. Which makes it one of the most efficient ways to save, because you hang on to more of your money, which could reduce the time it takes to get to your goal.
The taxman is no longer the axe man
He’s vilified by every hard-working man and woman in the UK. He’s even been berated in a song by the Beatles. But the ‘taxman’, that faceless and much-maligned government official, simply gets a bad press. He would actually love you to keep more of your money.
The government gave us the ISA to encourage us to save. Furthermore, over the years the amount we can all put away before triggering tax has gone up and up – and really quite generously. Today, and until 5th April 2017, you can save up to £15,240 in a cash or stocks and shares ISA, and in the 2017-2018 tax year this allowance goes up to £20,000 - and every penny of the interest is tax-free.
Not just a saver, an investor
There are many types of ISA: Cash ISAs, Stocks and Shares ISAs, Lifetime ISAs, Help-to-Buy ISAs – and they’re all easy to open.
Cash ISAs, for instance, may suit if you’re a saver who wants to earn tax-free interest on the money you put away in the short term. But if you’ve a longer-term savings goal in mind, like some of the ones we’ve been talking about, a Stocks and Shares ISA, like the one we provide, might be more your thing. Especially if you’re comfortable balancing risk with the opportunity for growth. But don’t worry, you don’t need to be a Wall Street investor like Gordon Gekko to get the returns. Our NISA, New Individual Savings Account, is an ISA with real investment experts behind it.
Whatever you decide, we’re flexible
The Foresters Friendly Society Stocks & Shares NISA (to give it its full name) is a flexible tax-free way to make the most of your annual ISA savings allowance, whatever your budget.
You can pay in lump sums or make regular top ups by direct debit. Regular or partial withdrawals can be made too, subject to conditions, (should you suddenly decide you need the money for that tablet NOW).
What’s more, if you’ve already got an ISA, it’s easy to transfer into a Foresters NISA. We’ll manage everything on your behalf.
Of course, it’s worth being aware that in some investment conditions you may not get back the full amount originally invested. Also, tax rules change, and can depend on individual circumstances.
But think about it. Think about all the things you should be saving for. Then what you could buy yourself for the same money. As an exercise it could be just a bit of fun. Then again, it could change your life forever.
Find out more about the Foresters ISA and how to apply >