What should I do to turn over a new financial leaf? |
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Source: Financial Mail Women's Forum, 8th May 2010 I am a self-employed woman of 50 who has never really gotten to grips with her finances. I have a small pension pot of £12,000, £5,000 in an ISA and £1,000 savings but am becoming increasingly concerned that this will simply not be enough to fund my retirement. I am prepared to knuckle down and stop spending - I can afford to put around £400 per month away. What do you recommend? - Angela, Sheffield I would suggest that you split the £400 per month between personal pensions and an equity ISA. One of the advantages of contributing to a pension is that you will benefit from tax relief on your contributions and receive up to 25% of your pension tax free when you do decide to retire; however, on the down side, you cannot access the pension until 55 (based on current legislation), so it is important that you have sufficient medium term investments in place. An equity ISA is a tax efficient way to invest and, although you will not benefit from any tax relief on your contributions, you will not pay any tax on subsequent withdrawals from the plan. - Lesley Collins, Chief Executive, Independent Women |
