Since April, when the new rules came into effect, the Association of British Insurers say savers have withdrawn £4.7 billion from their pension pots.

£2.5 billion was paid out in 166,700 cash lump sum payments – an average payment of £15,000, while another £2.2 billion was paid out in income drawdown to 606,000 people (£3,600 on average).

Meanwhile, canny investors have continued to commit money to a range of pension savings schemes. Of a total of £5 billion invested,  £2.9 billion was put into income drawdown products with an average fund size of £65,000. Another £2.2 billion was invested into annuities, with an average size of £53,300.

ABI Chairman Paul Evans said the figures showed people were looking for the best deal for their retirement.

‘Around half are now switching away from the company they saved with to secure the best deal for their retirement income,’ he said.

‘Overall, customers appear to be behaving rationally, and I think we can all be proud of the speed with which we responded to help the government’s reforms succeed.’

http://citywire.co.uk/new-model-adviser/news/pension-freedoms-savers-withdraw-4-7bn-since-april/a855167?ref=new-model-adviser-latest-news-list

Whether you are a saver or borrower you will be well aware that interest rates have been at historic lows – and for much longer than anyone predicted.  So which way will they go next?

As Governor of the Bank of England, Mark Carney has the unenviable job of setting UK interest rates alongside the Monetary Policy Committee.

Inevitably every public statement by Mr Carney is pored over by financial analysts to see if he is giving any clues to future rate moves.

Take a recent article in the Telegraph headlined: “UK interest rate rise not a guarantee, says Carney”.

It said:  “Mr Carney urged UK households to prepare for tighter monetary policy now. ‘If we think there is a prospect, a possibility – that’s a possibility not a certainty – of rate rises, then that is far, far better to let the British people know so they can prepare.’ he said. “

Any the wiser? As clear as mud? You wouldn’t be alone…

Perhaps the only fair conclusion is to take good advice and make sure you adopt an appropriate and balanced approach to your financial future.

http://www.telegraph.co.uk/finance/mark-carney/11953606/UK-rate-rise-not-a-guarantee-says-Mark-Carney.html

Much has been made in the media recently about the new pension freedoms which have been unleashed by the UK Treasury. There have even been reports of 20-year-olds asking when they can ‘cash in’…

Like all good stories, the reality of the pension changes introduced is quite a bit different. Yes, people now reaching their pensionable age will have greater freedom to say what they would like to do with their pot.

If you are lucky enough to be 55 after 6 April 2015, the perceived limitation of having to buy an annuity has been lifted so that pensioners will potentially have control of 100% of their fund.

But, the situation will vary depending on the type of pension scheme you are in.

If you have a “defined contribution” pension, you will be eligible for the pension freedoms when you reach age 55. If your pension is ‘defined benefit’ (otherwise called ‘final salary’), you may be eligible for the freedoms, but you will need to transfer the money to a suitable scheme first. You should take advice on this because guarantees can be lost.

If you’ve got a ‘final salary’ pension as a civil servant  you may, in some cases, be able to transfer the benefits to another scheme, as above. But some public-sector schemes, known as “unfunded” arrangements, will be excluded.

And, did you know that the age you can take your pension is also increasing? From 2028 it will rise in line with the age you can take your State Pension. For someone aged between 36 and 44 now that will mean waiting until you’re at least 58.

Confused? You may well be. By all means give us a call!

Tel: 0845 094 2970      

Email: admin@nexuswp.co.uk

Both the UK and Scottish Governments have introduced changes to the way tax is levied on house purchase transactions.

Doing away with the tiered system where buyers paid a flat rate of tax depending on which bracket the purchase fell into, there is now a ‘progressive’ scale which applies to all purchases.

All house buyers will pay 0% tax on the first portion of the house price – up to £145k in Scotland and £125k in the rest of the UK.

A levy of 2% is then made on the next portion up to £250,000 and a 5% rate applying to the next portion.

The rates increase up 12% on the most expensive properties as per the following table:-

Calculate your tax

Both HMRC and Revenue Scotland have produced online tax calculators to allow you to see how the changes may affect you. Click the links below.

HMRC

Revenue Scotland

Having grown-up children living at home could cost you dearly in terms of your planning for retirement, according to a study.

The recent recession and the ever-growing gulf between house prices and salaries means that adult children are increasingly having to stay with mum and dad while they save up a deposit.

And a survey by peer to peer lender Zopa puts the cost of that at an average of £32,664 and that four in ten parents face pushing back their retirement a further three years just to support their children.

Typical things which parents usually find they have to stump up for include weddings, a first car and university fees.  The research also found that girls are more expensive to accommodate than boys. Daughters cost their parents an average of £35,920, while sons cost them around £30,251.  

Nearly two in three parents have dipped into their savings, and seven in ten said they have adjusted their lifestyle to cater for the extra costs.