TRICIA PHILLIPS
TWO-fifths of people aged over 50 have helped children or grandchildren financially in the last six months. Living inheritances have helped youngsters get onto the property ladder, and with university costs and paying off debt, according to research from Retirement Advantage. Andrew Tulley, pensions technical director at Retirement Advantage, said: “There are some simple rules to remember when gifting which should ensure you don’t fall foul of the tax man. The main thing for those aged 55 or over who are thinking of gifting some of their pension, is that any withdrawal over the first 25% is treated as income and will be taxed as such.”
Other things to consider are: you can gift £3,000 a year without falling foul of tax laws under your annual exemption and you can also gift up to £1,000 (or £2,500 for a grandchild or £5,000 for a child) for wedding or civil ceremonies. You can make small gifts up to £250 per person as many times as you wish in the tax year so long as you haven’t used another exemption for the same person.
Coventry Building Society has increased the rate on its Easy Access ISA from 0.9% to 1.05% for new and existing customers.
It has also opened its Easy Access to previous years’ ISA funds. You can save from £1 and open accounts in branch, online at thecoventry.co.uk or by calling 0800 121 8899. One of the biggest financial concerns for British adults is not
having enough money in a pension pot to fund their desired lifestyle during retirement.
Yet, a third are failing to invest money to help support this. One in five say they don’t know which retirement product would suit them best, while more than a quarter find the changes to the pensions system too confusing.
David Newman, head of pensions at Close Brothers Asset Management who carried out the study, said: “Confusion persists around the UK pension system and the products available. This is only going to increase as we see products like the Lifetime ISA became more widely know. “Part and parcel of saving smartly is doing so via the correct vehicle. Bridging this knowledge gap is central to the long-term financial health of prospective retirees.”
Citizens Advice is warning that the expansion of Universal Credit from five to 50 areas a month from October is a “disaster waiting to happen”. The charity analysed over 50,000 cases and found that eight out of 10 on Universal Credit are at risk of eviction, visits from bailiffs and even prison because they are struggling with debt. CAB is calling on the Government to halt the roll-out of Universal Credit until problems with the benefit are fixed.