2 Autumn Statement announcements you may have missed that could simplify your finances Investments 18/12/2023 Jeremy Hunt delivered his second Autumn Statement as chancellor on 22 November 2023. While the headline news was cuts to National Insurance rates for employees and self-employed workers, there may have been less attention-grabbing changes that could make your finances easier to manage. Read on to discover how ISA and pension changes might be useful to you. 1. ISAs are set to become simpler ISAs were launched in 1999 to promote saving and investing in a tax-efficient way. Statistics suggest they’ve achieved that goal – according to the government, in 2021/22, 11.8 million ISAs were subscribed to, with around £66.9 billion added to accounts. Yet, over the years, ISAs have become more complicated. New ISAs have been launched, including the Lifetime ISA, aimed at aspiring first-time buyers, and the Innovative Finance ISA, which allows you to invest in peer-to-peer loans that are typically higher-risk than traditional investments. There are also rules around contributing to multiple ISAs during the same tax year and transferring between different providers.
How to help your family manage your affairs when you pass away Protection 28/11/2023 Planning for your death can be emotionally difficult, but it could be a huge help to your loved ones. Research suggests administering an estate after a loved one has passed away can affect mental health and finances. Read on to learn more about some of the steps you could take to help your family manage your affairs. According to the Exizent Bereavement Index 2023, more than half of people dealing with bereavement and administering an estate say it’s harmed their mental health. Furthermore, 28% said they suffered financial difficulties. This was driven by unexpected costs, Inheritance Tax (IHT) obligations, or pressure to distribute assets. In fact, just 1% of people said they found the probate process easier than expected. 6 practical steps you could take now to ease the burden on your loved ones 1.
More people than ever celebrate their 100th birthday. Here’s why it affects financial plans Retirement 14/11/2023 More people in England and Wales are celebrating their 100th birthday. It could have implications for your financial plan and creating an income in retirement. According to a release from the Office for National Statistics (ONS), on Census Day in 2021, there were 13,924 centenarians living in England and Wales. The oldest person to complete the census was 112. While centenarians represent just 0.02% of the total population, the number of people celebrating the milestone is growing rapidly. In fact, when compared to 100 years ago, the number of centenarians has increased 127-fold. Between 2011 and 2021, the number of people over 100 increased by 24.5%. Once population is taken into account, the UK ranks as the ninth country for the highest number of centenarians. Centenarians will have lived through the second world war and decimalisation The almost 14,000 centenarians who completed the 2021 census have lived through many defining moments.
Inflation has cost savers £113 billion in real terms in the last year Lifestyle 18/10/2023 High inflation over the last year has collectively cost savers billions of pounds in real terms, according to an Independent report. Have you considered the effect the rising cost of living could have on your wealth? While inflation may not reduce how much you have in your savings account, in real terms, the value may fall. As the cost of goods and services rises, what you could purchase with your savings falls. Usually, this happens at a gradual pace. However, as inflation has been higher than the Bank of England’s (BoE) 2% target for two years, the effect has been more noticeable. If the interest rate your savings earn doesn’t keep pace with inflation, the value of your money decreases. Inflation could reduce the value of your savings in real terms, but cash may still be useful The BoE calculations suggest £10,000 in 2021 would have to have grown to £11,774 in August 2023 just to have the same spending power.
3 essential factors to consider if you plan to gift wealth to avoid Inheritance Tax Lifestyle 18/10/2023 Figures suggest more families are gifting to avoid Inheritance Tax (IHT). While passing on assets to loved ones may seem like a clear solution, it isn’t always so simple. More estates are becoming liable for IHT as thresholds for paying the tax are frozen. The Office for Budget Responsibility predicts HMRC will collect £8.4 billion from IHT receipts in 2027/28, compared to £7 billion in 2022/23. The portion of your estate that exceeds IHT thresholds could be taxed at a standard rate of 40%. So, it’s not surprising that families are looking for ways to mitigate a potential bill. According to a Telegraph report, the number of people who have gifted assets that would become exempt from IHT if they survived a further seven years increased by 48% between 2009/10 and 2019/20. If the value of your estate exceeds the nil-rate band, which is £325,000 in 2023/24, your estate may be liable for IHT.
