Planning for retirement

Article Abstract:

Employees should begin making plans for retirement, especially if they are over 50 years of age. The first step is to select a trustworthy financial advisor. The issues to consider when making retirement plans include the percentage of income allocated to daily expenses, luxuries, leisure, and savings; the value of possessions, the amount of available capital, and potential capital expenditures. The next step is to determine the retirement date, the desired lifestyle during retirement, and the income necessary to maintain that lifestyle, followed by a more precise evaluation of future finances. Employees should rely on a company pension plan or a personal pension plan instead of a government pension, and they should make the maximum contribution possible. Investment vehicles include relatively risk-free premium bonds and bank deposits, and riskier unit trusts and investment trusts.

Employment, Demographic aspects, Retirement planning

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Best buys in PEPs

Article Abstract:

A personal equity plan (PEP) permits a sizable amount of money to be invested in shares, unit trusts, and investment trusts without added taxation on the resulting income or capital gain. Because they are tax-efficient, PEPs may be used in repaying mortgages, or in financial planning that requires large amounts of cash in the future. Potential investors in the UK, however, should take into consideration some PEP charges, the risk involved in investing, and their preference for income over growth. Those interested in PEPs may choose from the three types currently available: general PEPs, unit or investment trust PEPs, and mixed PEPs. A fourth type, a single-company PEP, is set to be introduced in 1992.

Evaluation, Laws, regulations and rules, Investments, Income tax, Capital gains tax

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Tax efficient savings

Article Abstract:

UK taxpayers can take legal steps to reduce their income taxes. Taxpayers can avoid paying income taxes on interest by using a tax-exempt special savings account. National Savings Certificates can be beneficial for taxpayers who wish to avoid income taxes and ensure security. Personal equity plans offer tax shelters from income taxes and capital gains taxes. Taxpayers should determine which type of investment vehicle is most appropriate by viewing their financial position from the perspective of their whole personal financial plan.

Analysis, Tax planning, Tax shelters

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