Interest rates are currently at record lows and inflation is at 10% meaning that the cost of living is rising much faster than your cash savings are growing so you are effectively losing money in real terms.
Over longer time periods, actively managed investments typically grow in value more than cash savings. Of course, investment values can go down as well as up and the value will change day-to-day. However, it is important to not dwell on the value and market movements and remember that you are investing for a long-time period.
At Four Wealth Management, your investments will be actively managed, and you will receive an annual review meeting to check that your investments are still on track to help you meet your individual goals. You can also let your financial adviser know of any changes in your circumstances that might affect your goals or portfolio.
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Lower risk investments
If you are concerned about investing, there are many low-risk investment options that might be suitable for your circumstances. A financial adviser at Four Wealth Management will let you know which options are available to you. These investments may generate enough growth to beat inflation while considering your attitude to risk.
Tax-efficient investment options
Investments can potentially generate higher returns than cash savings, so it is important to protect your returns from tax. The easiest way to do this is to invest through an ISA or a pension.
Currently, in the 2022/23 tax year you can invest up to £20,000 per year into an ISA. Investments in an ISA are free from any further liability to capital gains and income tax.
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Pensions offer the same tax-efficient benefits as an ISA but they also benefit from tax-relief on contributions. You receive tax relief at your income tax rate. The basic tax rate of 20% is automatically added. If you are a higher or additional rate tax payer then you have to claim the relief through your annual tax return.
There are different benefits and limitations of both an ISA and a pension which a financial adviser at Four Wealth Management will fully explain to you before you choose which account(s) to invest in.
Start making more of your money
Book a no-obligation meeting to discuss how to make more of your hard earned savings. Book online now or call us on 0117 973 0500.
The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested. Equities do not provide the security of capital which is characteristic of a deposit with a bank or building society.
The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.
