Investing for the 30-55s

Please note this blog post was published over 12 months ago and so may not include the most up-to-date information, for example where regulation around investing has changed.

Investing for the 30-55s

Investment strategies for the different age groups today have altered immensely from how they used to be. Cultural differences, lower salaries and a higher cost of living have all resulted in us both spending our money and saving it in vast contrast to that of both our grandparents and parents. Research has shown that those of us born in the eighties and early nineties are the hardest hit in terms of monetary value, however that should not dissuade us from being optimistic and saving for our future.

The way we spend and save during our thirties to fifties can change dramatically from one person to the next. However, what we believe to be the most important things to spend our money on is virtually the same. This could be due to the fact that this period in our lives is when we’re generally parents, aunties, uncles and guardians. Buying a property, building a pot of money for our children and their future and paying into a pension are all the key areas we look to plough our money into.

Nowadays, it is during our thirties that many of us decide to settle down, get married and start a family. In fact, we’re getting married 7.1 years later than those marrying in 1981. This can mean that a chunk of the money that we ought to be saving during this period in our lives, is actually going on large pay-outs. Not only this, but we’re also having children later in our lives than we did previously.

So what can we do when we’re 30-55 in order to prepare for retirement, save for our children’s future and make up some of the money that we may spend during our thirties? There are two key products that could be beneficial to you:

  • Stocks & Shares ISA
  • Personal Pension

Stocks & Shares ISA

A Stocks & Shares ISA gives you the opportunity to invest your money rather than simply save it into a bank account, and therefore, give it the potential to grow. ISAs offer great tax relief and in today’s market there are plenty of options of how to invest your money which could give you a greater return.

At True Potential Investor we give you the opportunity to self-invest into a Stocks & Shares ISA. You can open an account from as little as £50, be safe in the knowledge that should you have a query, our team of dedicated staff are on-hand to help out, and have the opportunity of tracking your investment 24/7 via our iOS and Android tablet and mobile apps. Not only this, but you’ll gain access to our award-winning technology, impulseSave®, that allows you to top up your account at any time from just £1.

Personal Pension

On almost a weekly basis we’re confronted with negative stories of our country’s state pensions, leaving many of us with little confidence in our financial state of affairs come retirement. However, by opening a Personal Pension as early into your working life as possible, you could be giving yourself an extra bit of financial security by knowing that you’ll have another pot of money to see you through your retirement. There are several reasons why opening a personal pension can be beneficial such as the tax relief, variety of ways to draw your pension and knowledge that your pension will be passed onto your loved ones in the event of your death (providing you state this with your provider).

During your working life you may be tempted to pause payments into your pension in order to fund other commitments, however by doing so, you risk missing out not only on that money come retirement, but the potential gains in return that could be made from that extra payment. Not only this, but with each pay rise you receive, it could be beneficial to raise the amount you put away for your pension.

With workplace pensions now in play for most companies, many of you will be paying into a pension through this. The minimum percentage both you and your employer pay in will rise in accordance to Government rules, however you can chose to increase the amount you pay in so you can opt to pay in more than the minimum required amount.

It may be worth noting that for some of you who may require access to your retirement savings before you turn 55, as well as saving into a pension, you may choose to pay into a Stocks & Shares ISA. Having an ISA gives you more flexibility than a pension which will lock your money in until you come to retire, which could be a good thing for some, but not all.

True Potential Portfolios

For both our Stocks & Shares ISA and TPI Pension, we offer clients the opportunity to invest into True Potential Portfolios. This range of discretionary managed portfolios are managed by our expert investment team and investment committee. What really makes these Portfolios unique in the market is the fact that we work with a range of leading fund managers including UBS Asset Management, Goldman Sachs, Allianz, Columbia Threadneedle, Schroders, SEI, Close Brothers and 7IM.

We then use ‘Advanced Diversification’ to blend a range of active and passive funds to create an offering that has over 120,000 holdings. And, with over 5,000 investment professionals in over 200 locations taking care of your investment, every minute of the day someone is thinking about your financial future. Plus, by using our own funds in the Portfolios, we get faster access to data which results in a low cost, which we then pass on to our investors.

No matter whether you are 30 or 55, planning for the future is a necessity that we must all face. The sooner you start, the bigger your pot could grow, but it’s never too late to start investing.

With investing, your capital is at risk. Investments can fluctuate in value and you may get back less than you invest. Past performance is not a guide to future performance. Tax rules can change at any time. This blog is not personal financial advice.

Global Markets, Personal Finance