Re: Completely confused please help!! :(

sjane2008

Hi there.

Well financially at present I have managed to clear my debts via £250 on a credit card (this is left to boost credit rating rather than always paying in full).

However...at 28 I have suddenly felt a little concerned. I have no pension (and find this extremely confusing and don't wish to pay for a broker), no health or dental plan, and no real savings. I now earn above £20000 a yr so can now start planning.

Is it worth while, due to the state of the economy just putting money into premium bonds or some other way/account ie self investing to cover the above rather than commiting to a pension etc or savings fund right now and then waiting til the economy stables? Also looking for income protection too as thought would def be a good time for this?

Any help much appreciated!!!

Rafter

SJ,

Well done getting debt free.

If you are employed you should join your employers scheme as their contributions will boost your pension pot.

If you are self employed you have options. You can get a pension plan up and running which will save you tax but cannot be accessed until you retire and isn't totally flexible.

Alternatively you can start building up some tax free savings, either ISAs or national savings.

The problem with premium bonds or simple cash isas is that the interest will only just about keep pace with inflation. You really need to think about stocks and shares ISAs which although riskier are likely to grow faster in the longer term and therefore give you a bigger pot of money when you retire.

Income protection has got more expensive and may be difficult to get if you are self employed. You can buy policies online. However, we do have a good social security system in this country and you have to ask yourself how long it would realistically take to get another job, even paying less than you are currently on. If the answer is less than two months, then income protection may be a waste of money because the policy will only pay for a very short period if any.

Good luck

R.