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Make your money work harder for you
Whether you’re focused on what needs doing today, or you’re setting out your goals for tomorrow, we want to help you get more from your money.
Find the right balance
A smart financial plan relies on balance. But first you need to consider your personal situation. The 50 30 20 rule is a good place to start.
Explore ways you can make your money work for you.
- Investments.
- Pensions.
- Mortgage.
- Your estate.
Define your financial goals
Not sure where to begin? Start with the basics.
A plan for your investments
Remember that investments can go up and down, so you might get back less than you put in.
A plan for your pension
Tweaking your contributions could help to boost your pension pot.
Increase your pension pot
Adding extra money to your pension is a smart way to prepare for retirement and benefit from tax relief.
Tax relief is where HMRC tops up your qualifying pension contributions at the basic rate of tax. For example, if you’re a basic-rate taxpayer, the government adds £25 for every £100 you contribute. Higher or additional rate taxpayers could claim extra tax relief through their self-assessment.
Tax treatment depends on individual circumstances and may be subject to change.
From age 55, you can usually start to access your pension. This minimum age will rise to 57 from 06 April 2028. But being able to take your pension doesn’t always mean it’s the right time for you. Leaving your pension invested for longer can give it more time to grow and could help support your plans for later life. An independent financial adviser may help you with the right options for you.
A plan for your property
If you have a mortgage, you might want to pay it off early. This can be a good idea, but you may be better to tackle other debts with higher interest rates first.
If you have a fixed-rate mortgage and expect higher repayments in the future, try to pay more while the interest rate is lower. This can reduce the impact of future rate increases.
Also, check for any early repayment charges, as some lenders allow up to 10% overpayment each year without penalties. You may want to get independent financial advice to see what options are best for you.
Could your home give you a source of income later?
Owning your home can be a huge asset. You have the option to use it as a potential source of income in your later life. There are several ways to use your home for financial benefit, but it’s important to consider your options carefully.
Things to think about if moving is part of your plan
If selling your home is part of your plan, make sure it makes financial sense.
Consider your home’s value, the housing market’s performance, and its readiness for sale. More importantly, make sure the move aligns with your lifestyle goals, especially in your later years.
- Factor in all costs. Consider the overall financial picture, including the cost of living in your new home.
- Move for the right reasons. Consider cost, location, social and health benefits.
- Think about the future. Find somewhere practical for later life that you’ll be happy in for many years.
- Equity release. This allows homeowners aged 55+ to unlock tax-free cash from their property value without moving.
A plan for your estate
Think about your future care needs and what will happen to your estate when you’re gone. Having a plan can give you peace of mind, knowing everything will be taken care of.
You may want to think about
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One of the most important things you can do is have a will. This ensures that everything is handled according to your wishes. It’s also wise to review your will regularly, as your priorities and circumstances can change over time.
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It might be a good idea to set up a power of attorney. This allows someone you trust to make decisions for you if you can’t do it yourself.
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If you have a life insurance policy, you can appoint a beneficiary that would receive the benefits after you’re gone.
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Most people pass their home on to their family. If your estate exceeds the Inheritance Tax allowance, gifting your home to your children could secure an extra tax-free allowance of up to £175,000. Find more information on the government website.
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To pass on your remaining pension savings to family or friends, nominate a pension beneficiary and inform your pension provider. You can find out more from our pension experts at Scottish Widows.
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Later life care can be expensive, so it’s good to know what your options are. Talk with your family and make a plan to make sure you get the care you might need.
Another thing to think about is a funeral plan. This will guarantee you get the type of funeral you want.
With a funeral plan, you pay upfront for most of your funeral at today’s prices. Getting a plan from a funeral director or provider allows you to set aside for funeral costs. You can pay in a lump sum or monthly instalments.
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If Lloyds is the named executor and you need support to deal with an estate or would like to find out more about our services, call us.
Our initial support and guidance is fee-free and without obligation. If you think the service is right for you, we’ll explain our fees and charges to act as executor or administrator in an estate. Fees and charges for our services are charged to the estate.
Take the next step
We can help you make the first steps to making your money work harder.
Further support
We have more support to help you through your financial stage in life.
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Important legal information