110k

poshman

Hi all I reach 65 this week and I will be getting 130K pension lump sum
I plan to save about 110K long term say 2 years initially
I dont want to go down the stocks and shares route just want a plain and simple savings account any advice please

atush

what do you mean by 130K lump sum? Is that 25% of your pension? Or is that your total pot size?

If door no2, you wont be getting anywhere near 110K as you will be paying loads of tax on it?

If door no1, why no stocks and shares at all? Long term, they are the only way to beat inflation. And you dont have to bet the farm or be super risky either.

More details?

Anyway, in answer to your Q, nsi or a bunch of interest paying current accts.

xylophone

The OP previously indicated £20,000 per annum pension with £137,000 PCLS.

OP, are you also drawing your state pension? Have you thought of deferring it?

https://www.gov.uk/deferring-state-pension/what-you-may-get

With regard to savings rather than investments, you might consider the current accounts merry-go- round route.

Otherwise, for total simplicity NS&I Income bonds for the lot - http://www.nsandi.com/income-bonds

You'd need to advise HMRC as the interest is paid gross.

Or http://www.thisismoney.co.uk/money/article-1583859/Best-savings-rates-General-savings-Internet-branch.html

poshman

Thank you for your prompt answers and sorry for the vauge question!

I will be getting 145K lump sum then plan to pay off car 8K

Then 22K per year pension

Plan to work another year and not draw gov pension for a year

atush

Ok, so how much will you earn next year?

Will 22K put you over the BRT band?

jimjames

You might want to reconsider the no s&s part.

There is no need to put all the money in the same thing but keeping too much cash for what could be 20-25+ years retirement could mean you have insufficient income in later years.

You could use your S&S ISA allowance for a few years to make sure your money is protected from tax and keep the rest as cash. It will certainly take a while to feed that amount into ISAs.

You'll get around 4% at the moment from equity income funds which is way higher income than any cash isa.

poshman

I should have planned this months ago ! Not sure what BRT band or s &s means

I will be earning 50K salary for the year and 22K pension yearly
Goodness know how much tax i will be paying will both incomes be taxed seperatly
At least i know i wont be paying £300 a month NI.

Lokolo

BRT = Basic Rate Tax
S&S = Stocks and Shares

jimjames

poshman wrote: »

I should have planned this months ago ! Not sure what BRT band or s &s means

I will be earning 50K salary for the year and 22K pension yearly
Goodness know how much tax i will be paying will both incomes be taxed seperatly
At least i know i wont be paying £300 a month NI.

No, you'll be taxed on the total.

So if your salary is paid by your employer net of tax then your pension will be taxed in full at 40%.

xylophone

Goodness know how much tax i will be paying will both incomes be taxed seperatly

In your position I would check tax codes very carefully.

Do you intend to make pension contributions during the year that you are working?

atush

in your case you will be earning 72K, and paying a HUGE amount of HRT. Approx 12K on just the 30K over the allowance?

So I would put 30K PA into a DC pension. Which would be boosted by 40% (ie you will get BRT added to your pension fund and will reclaim the extra from HMRC as lower tax ont her est of your money or by SA if you go that way).

BRT is basic rate tax, HRT is higher rate tax (and boy will you pay it) and s&s is stocks and shares isa (a misnomer as you can use collective funds you dont have to use single shares)