What else could I be doing with my money beyond the things I already do?

12 October 2021

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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 Oliver McDonald

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

Oliver McDonald

Director & Independent Financial Adviser

I have worked in financial services for 15 years gaining extensive experience in financial planning. I am a people person. You will rarely find me explaining complex spreadsheets or using jargon. I keep my conversations at a high level and realised early on that financial planning is all about helping my clients achieve the lifestyle they want in future. I work with individuals, business owners and entrepreneurs. I specialise in retirement planning, investments and business protection.