Page 42 - Phonebox Magazine September 2016

Traditionally, pension rules have been far more complicated than ISA rules and the relative simplicity of ISAs has no doubt been a major factor in their popularity as a tax e cient form of saving. Whilst there have been numerous attempts to simplify pensions in recent years and whilst some of the changes have achieved this and have been very positive, the rules still remain relatively complex. Now, however, there is a very real risk that investors will be confused by the wide range of ISAs on o er and by their relative merits in comparison to pensions.
There is already a wide range of ISAs on o er, such as the traditional Cash ISA, the Stocks and Shares ISA and the Junior ISA. We also now have a Help to Buy ISA (designed to help people take their rst steps on the property ladder), an Innovative Finance ISA (for specialist higher risk savings and investments, such as peer to peer loans) and an Inheritance ISA (allowing someone to inherit their partner’s ISA on death)! To
further complicate matters, next April sees the introduction of the Lifetime ISA, aimed at the under 40’s and designed to help people save either for a deposit on a property or for retirement as an alternative to a pension.
All these ISAs undoubtedly o er speci c bene ts but the danger of providing so much choice is that you confuse and alienate savers. Furthermore, the Lifetime ISA will compete with pensions and, without advice, there is clearly a risk that savers will make the wrong decision.
If you would like to discuss or review your own investment or retirement plans then please call us. Initial meetings are without charge and we are happy to come to see you in the comfort of your own home. See our advert below.
This article does not constitute advice and should not be taken as a recommendation to undertake any course of action mentioned without consulting a relevant professional.
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42 Phonebox Magazine | September 2016
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