These days, having some money put aside can make a big difference. Our Investments and Savings give us peace of mind, should anything unexpected happen - for example, random bills, repairs or losing your job. Alternatively, Our Investments and Savings can help us buy our ideal house, car or holiday.
There are various ways you can help increase the value of your Investments and Savings. You might prefer a safe way to grow your money, such as Savings accounts and ISAs, or higher risk products such as OEICS or VCTs that can offer greater returns. You can decide which method suits you best.
We have listed some examples below of the Investment and Saving options available. A Financial Adviser will be able to create a bespoke strategy for your unique Financial situation. The Financial Adviser will assess your income, expenditure, financial goals and attitude towards risk.
Tax has a habit of eroding your Investments and Savings, so one of the easiest ways to increase your money is through an ISA.
ISAs do not incur any Income Tax or Capital Gains Tax on any increase in value. Despite there being many different types of ISAs, the 2 main categories are Cash ISAs, and Stocks and Shares ISAs.
A Cash ISA will accumulate interest every year, although the interest can vary from ISA to ISA.
Stocks and Shares ISAs are as the name suggests, invested in the stock market and shares of companies. This type of ISA is considered more of a longer term investment.
As of July 2014, all ISAs became NISAs (New Individual Savings Accounts). The annual limit for a NISA is currently set at £15,000 and can be a mix of both a Cash ISA and Stocks and Shares ISA. The limit will be increased to £15,240 in the 2015 Tax Year.
No one is better placed to offer advice on how to arrange your ISA than a Financial Adviser. They can provide you with a wide range of all the best deals currently on the market in order to help you maximise your ISA.
All the High Street banks offer savings accounts and it can be a good way of building up your savings.
Be sure to check the performance of your savings account, seeing as the interest rate is low and can be problematic for savers. Your best option might be to consider an ISA, because any interest you make from your savings account is subject to Tax.
National Savings and Investments (or NS&I) is a safe way to save money via a government backed agency that is for both adults and children.
Financial Products that are a part of the NS&I are: Income Bonds, Premium Bonds, Children Bonds, ISAs, Savings Accounts and Saving Certificates.
Most of the Financial Products listed offer Tax-Free savings, although they do not offer the most competitive interest rates.
Open Ended Investment Companies are collective Investments Schemes, where the money you have invested is pooled together with other Investors, which aims to spread the risk involved. They will then use this sum of money to invest in stocks, shares, property and bonds.
Naturally, the value of your investment within the OEIC is determined by the markets, and can either decrease or increase.
OEICs are considered long term investments and can increase your initial Investment by a decent amount.
A Financial Adviser will be able to explain the various OEICs on offer and help you choose an Investment that is right for you.
Unit Trusts are similar to OEICS, but In a Unit Trust, you can buy or sell ‘units’ of a fund. The fund manager (who runs the Unit Trust) will invest in various different companies, properties or bonds that will increase in value over time. The fund can either be Actively managed or Passively managed.
Actively managed funds are run by a fund manager who decides the best investment for the fund, this is regarded as a high-risk investment.
Passively managed funds track the market and are regarded as a lower-risk investment.
Offshore investments is where your money is invested outside the UK. Overseas Investments provide an opportunity to increase your savings, seeing as the funds are not subjected to the same rules and regulations they would be in the UK, which means greater freedom to maximise your returns. However, with fewer regulations comes greater risk, if anything does go wrong.
Offshore Investments can provide you with the opportunity to reach a far wider range of markets than are available to you in the UK, and enables you to take full advantage of growth in emerging markets. Naturally, that Investment could fall at a similar rate.
Tax relief may also be available on some of your Investments, depending on which country it is. This is a complicated area where you will undoubtedly benefit from liaising with a Financial Adviser.
If you would like to discuss Investments and Savings with a Financial Adviser near you, please click on the button below.