30 June 2014

Rethinking Retirement Planning 1 - Using Pensions as Savings

The March 2014 Budget has shaken up retirement planning. By promising easy access to pension plans (defined contribution ones, anyway) new opportunities - and risks - are opened up. Here we look at your pension as savings.

While pensions are taxed differently*, they look a lot more like ISAs than they used to. When you need some capital to spend you will be able to withdraw it from your pension. Since there is a limit to ISA savings putting spare cash beyond that limit into your pension now seems like a better thing than it used to, since you will be able to get it out again.

But there are dangers. Clearly a pension is there primarily to provide an income in retirement, and if you've spent it all, you are going to have hard times!

So it needs some thought, but the new freedoms are likely to be worth taking advantage of.

*Basically, ISAs are subject to tax on the way in (when you add money to them) since that money comes from taxed income, while pensions are taxed on the way out (when you take an income or withdraw a lump sum - other than the initial tax-free lump sum, that is).

11 June 2014

Who will do the best job with your Will?

A recent research project including the Office of Fair Trading and the Solicitors Regulation Authority reviewed 101 wills provided to consumers.

41 of these were provided by solicitors and 9 of those were deemed unsatisfactory by the researchers.

It was a similar unsatisfactory proportion for non-solicitor will writers.

That strikes me as a pretty high percentage, but the key point is that solicitors don't do a better job than anyone else. And when you consider that only a small part of their training is on wills you couldn't say that they are the experts.

Overall, I'd have to say you are better off going to someone who can provide a wider service and can recognise other needs too. We use full time will-writers to provide our service, and as an independent financial adviser I can also provide Inheritance Tax and other advice.

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