Tips to stay on top of financial planning next year
By Kirsten Hastings, 22 Dec 15
This year has brought about a significant number of changes that impacted the personal finance landscape. There have already been a number of announcements which will affect people’s financial plans, says Andy Cumming, head of advice at Close Brothers Asset Management, who outlines four key things to watch out for in 2016.
Keep an eye on the lifetime allowance:
In the March Budget, George Osborne cut the lifetime allowance on pension savings from 1.25m to 1m ($1.5m, €1.38m). While £1m may seem like a very generous amount, and many will assume it is not one for them to consider, a surprising number will be in the bracket affected.
Those in final salary schemes that will pay approximately £35,000 – £40,000 a year, with inflation added in over the years, could see themselves knocking on the door of the £1m allowance sooner than they think.
It’s vital that savers don’t rule themselves out of this before they have thought ahead, and considered their potential income in 20 to 30 years’ time.