What else could I be doing with my money?

12 October 2021

Question by Sam

What else could I be doing with my money beyond the things I already do, (i.e. investing in an ISA and pension) and that consumer sites recommend, specifically in regards to passing on wealth to my son?


Answered by Boring Money

Hi Sam,

Thank you for your question.

It is difficult to answer your question without further information, but the information below should help.

In the UK, you can save up to £40,000pa or 100% of your salary in a pension, whichever is lowest. A Stocks & Shares ISA can also receive £20,000pa. Until you reach this level, most people don't need to look much further in terms of investments. But there are some other options.

Depending on your son's age, you could open a Junior ISA (JISA) and contribute up to £9,000pa. This would become your son's own Stocks & Shares ISA from age 18 onwards.

If you mean passing on wealth on your death, a pension is incredibly tax-efficient in many ways. You receive tax-relief on the funds going in, the funds grow tax free and you can access some funds in future tax-free. Pensions are passed on outside of your estate, so they do not attract inheritance tax. Most assets outside on your pension will be subject to inheritance tax.

There are also gifts you can make each year which are exempt from inheritance tax.

I hope that helps for now. There are many other options but very difficult to comment without knowing your full circumstances and proving regulated advice.

Oliver

*This answer is for information purposes only and should not be relied upon for advice.

Answered by

Boring Money