See how saving can make all the difference whether for day-to-day life, the years ahead or for your long-term future.
Save for today
Saving for today makes everyday life easier to manage. There’s less stress. Plus, it’s the ideal way to start saving for a better long-term future.
Being able to pay for your ‘must haves’ like bills and food, without going into debt also gives you peace of mind.
Cars, computers, kettles. If you have money to mend or replace, it’s an easier fix.
Enjoy stress and debt free holidays and festive days, when you have money to make them a treat.
If you want to save for up to one year, accounts that give you easier access to your money can be the way to go. Be careful, inflation might reduce the value of your money.
Product | How they work |
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Individual Savings Account (ISA) |
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Instant Access Savings Account |
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Save for up to five years
It’s time to start thinking bigger and better. Start looking to the future and think about the things you’ll want or might need. Then make it happen.
You might need to get a new car, or a home extension. Having money saved is cheaper than loans, because you don’t pay interest.
Put down a deposit, get married, or help a child with education. Planning your money makes the journey easier.
Redundancy, major illness or going out of business. Some experts think you should save between three to six months’ salary.
If you want to save for up to five years, you might think about locking your money away for some time for better returns, if you can afford it.
Product | How they work |
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Individual Savings Account (ISA) |
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Savings Bonds |
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Regular Savings Accounts |
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Save for the long-term
Long-term saving is mostly for retirement or a major life goal, like paying off your mortgage. They might seem far off for some, but this doesn’t make them less likely to happen. For many of us, one long-term savings goal is retirement.
Starting early might allow you to take your benefits earlier, and could allow you to make lower regular payments.
For long-term savings, many people use investment funds. These might invest in company shares on the stock market, for example. The growth in the investment will then depend on how well the shares perform. Investing has more risk than savings accounts or cash ISAs.
Inflation is how the increase in prices lowers the spending power of your money. Investments aim to beat any increases in inflation. But, it’s riskier.
Over the long-term, investments aim to do better than savings accounts. But there are risks that investments won’t perform well.
It’s important you understand that returns aren’t guaranteed. You may not get back what you put in.
This means that tax is added to your pension by the Government. So, if you’re a basic rate taxpayer, for every £80 you save, the Government will top up your pension with £20. If you’re a higher or additional rate taxpayer, you can claim for extra tax relief on your tax return.
See the options you have to plan for your long-term future.
Product | How they work |
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Workplace Pension |
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Individual Pension |
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Individual Savings Accounts (ISA) |
There are cash, stocks and shares, innovative finance and Lifetime ISAs. There’s no tax on any growth on any of these. If you want to save for the longer term, stocks and shares ISAs and Lifetime ISAs may be a good idea.
You can spread up to £20,000 (for the tax year 2020/2021) across all the different types of ISAs. But you can’t have more than one of each type of ISA in a tax year. |
General Investment Account (GIA) |
This is an account you use to invest in funds, like the stock market or property funds. Money in these can be taxed. Anyone can have one of these if they’re over 18 and live in the UK. |
Property |
Many people consider investing in property to fund their retirement.
There are a lot of risks involved in property. Finding tenants, problem tenants, maintenance bills and falling property values to mention a few. Tax is also important. Rent is now taxed at your highest rate of Income Tax. That’s before any costs or deductions. You may also have to pay Capital Gains Tax when you sell a home, if you have more than one property. |
With all the suggestions above, please be aware that your tax depends on your circumstances, which can change. Tax rules can also change in the future. |
Find out how Scottish Widows can help you save for your future or provide retirement incomes.
Whatever stage of the retirement journey you’re at, get the basics before you go any further.
If you need to ask us a question about pensions or retirement, then get in touch. There are lots of ways to contact us.