Plan For A Brighter Future
Tuesday, February 10, 2009 17:38
Savings, insurance, pensions… not the most exciting things to think about. However, they are among the most impoartant decisions you’ll ever make.
The following points should be always bear in mind.
First of all, be organised. Separate the savings into three areas—think of short-term as the money that pays today’s needs, medium-term as the funds to help with the purchase of a new car or house, and long-term as the savings that will make your life comfortable in retirement. Then you’ll know exactly how much you’re able to spend now.
Secondly, shop around. Some savings accounts offer better interest rates if you agree to tie up your money for a specific amount of time, so consider what you can commit to. Just make sure that you can stick to the terms and won’t lose out when trying to take the money out early.
Thirdly, save tax-free. There are ways of saving that can earn money. it’s possible to get savings accounts with tax-free interest in the form of a cash ISA. The interest rates tend to be higher than other accounts offer, too, and you will usually have easy access to your money. there are, of course, limits to what you can save each tax year. Check it out for more detailed information on-line.
Fourthly, if you have a family, it might be worth opening a Child Trust Fund, a long-term savings and investment account that your child can withdraw money from when they’re 18. The Government provides 250 pound to start the account and there’s no tax to pay on the income and gains.
Fifthly, be prepared. Insurance is something that all of us would rather not pay for, but it can protect your finances and your family. It’s the unexpected things, such as long-term illness or unemployment, that can really destabilise your finances, so it’s worth being prepared.
Last but not least, try to relax! When you finally get a chance to kick back and relax, you may as well do it properly. Putting away some of your savings into a personal pension will help to ensure that you have enough to support yourself in the future. Or, if you have a job, you may benefit from an employer pension scheme. There are other perks, too—pension contributions attract some tax relief.
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