Pensions

2 March 2021

What does the March Budget hold in store?

The tussle between economic stagnation and combustion leaves the Chancellor performing a high wire tight rope act in next week’s Budget. On one side lies spiralling government debt and potentially rampant inflation, on the other side, a faltering economy, and more job losses.

The Budget is likely to remain focused more on providing support for the...

20 July 2020

How to avoid a 90% annual allowance cut if you need to access your pension

Even before Covid-19 hit, the money purchase annual allowance (MPAA) felt like an unfair punishment for savers whose only crime was accessing taxable income from their pension pot.

During this crisis many more over 55s will be facing salary cuts or joblessness, while others will need to use their savings to help loved ones struggling to make ends...

8 July 2020

Stamp duty sugar rush for the housing market

Today’s statement was always likely to focus on ‘good’ news items designed to stir the UK economy from its economic slumber. We got that in the form of a big VAT cut for the hospitality sector, new job creation programmes and a headline-grabbing reduction in stamp duty.

However, the Chancellor was clear stabilising the public finances and paying...

4 June 2020

UK workers prepared to pay extra 4% income tax to fund £300bn pandemic bill

Battling back from Covid-19 is going to be a long hard journey. As the UK Government eases lockdown restrictions and state support for the economy is slowly scaled back, debate will inevitably pivot towards how the near £300billion black hole in public finances should be filled.

While the Coalition Government opted for public spending cuts to...

12 May 2020

1.7 million younger savers vulnerable to ‘early access’ pension scams during Coronavirus crisis

The UK National Cyber Security Centre have warned Coronavirus is the “top lure” currently being used by online criminals. One in 8 (16%) of people under 55 with a pension would consider an offer to access their fund early to help get them through the Covid-19 crisis. Younger savers are more at risk, with one in every five (21%) or 1.7 million* 18...

4 May 2020

Five things you should consider when accessing your pension during Covid-19

Over 1 million people have enrolled into the Government’s furlough scheme, while millions more are facing either unemployment, pay cuts or severe job insecurity. 1 in 10 (11%) of over 55s with a pension have either already accessed or plan to access their retirement pot earlier than anticipated as a result of Covid-19*.

Tom Selby, Senior Analyst...

16 April 2020

Pension vs Lifetime ISA: the tale of the tape for retirement investors

The Lifetime ISA (LISA), which is the first dual-purpose product aimed at both first-time buyers and retirement savers, has just celebrated its third anniversary.

The LISA has split opinion across the industry, with some arguing it is a useful alternative to traditional pensions and others warning it creates the wrong incentives and should be...

15 April 2020

Peak pension freedoms season: Five things to consider when flexibly accessing your retirement pot

The start of the new tax year is peak pension withdrawal season for UK savers. In each year since the pension freedoms were launched in April 2015, the first three months of the tax year (from 6 April to 6 July) has seen significantly higher withdrawal levels than any of the subsequent quarters.

In most cases this will simply reflect people making...

25 March 2020

The quirks that mean you can pay up to 200,000% in tax – and how to avoid them

The loss of some benefits and allowances can potentially result in effective tax rates way above the highest income tax band in the UK:

Loss of benefit / allowance Maximum effective tax rate Child benefit 57.89% Personal allowance 60% Personal savings allowance 22500% Married couples allowance 25000% Tax free child care 200000%

The complicated and...

24 March 2020

Beware rise in pension scams as Coronavirus fraud reports surge 400%

While the country hunkers down in the hope of slowing the spread of Coronavirus, the economic fallout will inevitably lead to an increase in the number of vulnerable or potentially vulnerable people in the UK. In such an environment unscrupulous scammers will already be plotting ways to take advantage during what for many will be a time of serious...

6 March 2020

The personal finance announcements to look out for in next week’s Budget

New Chancellor, Rishi Sunak will make his first Budget announcement next Wednesday, 11 March. Laura Suter, personal finance analyst at AJ Bell and Tom Selby, senior analyst at AJ Bell, outline what people should be looking out for in relation to their personal finances.

Pensions Urgent measures to address the NHS pension tax taper problem

While...

2 March 2020

Four reasons for the pensions gap – and how to tackle them

The nation isn’t saving enough for their retirement, but women end up with pension pots lower than men – which can have a dramatic difference to their lifestyle in retirement.

Women face a triple whammy when it comes to their pensions: they are not saving enough; they are not investing that money and so could be missing out on higher returns over...

26 February 2020

Self-employed pensions: Making retirement work for you

The UK is in the midst of an entrepreneurial boom. The level of self-employment surged from 3.8 million in 2008 to almost 5 million today, according to the Office for National Statistics.

While this trend is among the defining characteristics of the post-financial crisis economic recovery, it also presents a retirement challenge. Because, as the...

20 February 2020

Key changes for 2020/21 tax year

Every new tax year brings in changes to the rules and allowances for how much people can invest and where. And the 2020/21 tax year is no different. Below is a list of the major changes we can expect to see next tax year – covering pensions and savings, property, and employment status. Not all the detail is pinned down yet; we are still waiting for...

18 February 2020

Is the Government about to scrap higher-rate pension tax relief?

You may have read reports recently suggesting the Government is considering reforms to pension tax relief at the Budget on 11th March. We're here to separate pension fact from fiction.

How does pension tax relief work at the moment?

When you pay money into a pension it is free from income tax, with total annual contributions (including tax...

9 December 2019

Election watch: How the major parties shape up for your finances

This election has seen an unprecedented focus on policies aimed squarely at pensioners, with all parties keen to bolster support ahead of polling day on 12th December.

Pensions are arguably the big story of the Labour campaign, with the party committing £58 billion in compensation to the WASPI women and freezing proposed increases in the state...

28 November 2019

How the Conservative manifesto could affect personal finances

The Conservative election manifesto might not be as radical as Labour’s but there are still plenty of proposals that would have an impact on people’s finances and long term savings.

AJ Bell’s analysts consider the key pensions and personal finance pledges put forward by the party.

National Insurance and income tax U-turn

National Insurance rates...

28 November 2019

Green Party manifesto promises radical shake-up for people’s finances

The Green Party has published its election manifesto, including various proposals that would affect savers and retirees.

Based on recent polling, it is possible the next Government will be a coalition comprising a number of the minor parties. The views of these parties are therefore probably more important than ever before.

AJ Bell’s analysts...

28 November 2019

What would the Liberal Democrat manifesto mean for your finances?

The Liberal Democrats published their manifesto as the general election battle picked up pace.

While the Conservative and Labour documents will understandably draw the most attention, the minor parties could yet have a crucial say in the future direction of the country.

AJ Bell’s analysts consider the key pensions and personal finance pledges put...

28 November 2019

The potential impact of the Labour manifesto on people's finances and long term savings

Labour has published its election manifesto with plenty of proposals that could have a big impact on people’s finances and long term savings.

AJ Bell’s analysts consider the key pensions and personal finance pledges put forward by the party.

Freeze in state pension age increases beyond 66

Make no bones about it – this is a gargantuan promise from...

19 November 2019

Government proposes emergency NHS pension tax fix but does it risk creating more problems?

The dog’s breakfast that is the annual allowance tax taper is getting more and more ridiculous by the day. It is ludicrous that the UK’s mind-bogglingly complex pension tax system is now causing significant capacity issues for the NHS – effectively putting people’s lives at risk as senior consultants refuse shifts to avoid huge tax bills.

In...

11 November 2019

Average pension scam victims lose 22 years of savings in just 24 hours

Hubris and trusting the ‘advice’ of strangers are proving to be the undoing of scam victims. This is a recipe for disaster as fraudsters prey on the good nature of hard-working savers.

The results of scams are often heartbreaking, with thousands of people losing pensions they have worked their entire lives to diligently build up. In many cases...

30 October 2019

How the general election could affect people’s finances

With the UK heading towards a general election on 12 December, Laura Suter, personal finance analyst at AJ Bell and Tom Selby, senior analyst at AJ Bell, look at how the outcome could affect people’s personal finances in some key areas.

Income tax

Boris Johnson pledged a number of changes to personal finances in his campaign to be elected prime...

15 October 2019

Five pension problems the Treasury needs to focus on

The Treasury has confirmed the 2019 Budget setting out this Government’s fiscal agenda is scheduled for 6 November.

While there is no guarantee this administration will actually survive that long, there are various issues demanding Chancellor Sajid Javid’s attention.

1. Scrap the pension tax taper

The strains being placed on the NHS as a result of...

9 October 2019

How Monday’s Queen’s Speech could affect personal finances

Assuming we finally get a Queen’s Speech on Monday, any impact on our personal finances is likely to come via a Pensions Bill setting out the Government’s legislative priorities for savers and those already in retirement.

What are some of the key areas a Pensions Bill could focus on?

The Government wants to introduce the principles of Open...