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top up pension

I have posted this somwhere before Cant find it!

I was asking about savings accounts for the purpose of investing long term as a 'top up' pension, just for some extra money to act as an additional source of income. I.e investment of £100.00 pm over 28 years= £33,600 including interest at 5% this would be £73,042. this would generate roughly £304.00 per month additional income. I was thinking of the sum of £100.00 per month over a period of about 28 years. I was advised to start a stocks and shares ISA,

1) Can someone post a reply with this main link to an S&S ISA?
2) can anyone confirm that any interest/dividens earnt will be non taxible and not count towards the earnings threashold in older age?
3) is this the best way to go about investing this sort of money for what I want?

Thank you
INCREASE INTEREST ON SAVINGS!

...I will thank you if youve been helpful, please do the same! :j

Comments

  • EdInvestor
    EdInvestor Posts: 15,749 Forumite
    wayoflife wrote: »
    I have posted this somwhere before Cant find it!

    I was asking about savings accounts for the purpose of investing long term as a 'top up' pension.. I was advised to start a stocks and shares ISA

    If you are talking about cash savings you need a cash ISA,not an S&S ISA. You can also accumulate cash savings (and get tax relief on them upfront) if you put your money in a SIPP ( a Self Invested Personal Pension), choose one with no anual fee. Not that this is usually done!
    2) can anyone confirm that any interest/dividens earnt will be non taxible and not count towards the earnings threashold in older age?

    If in a pension interest is non taxable but the income when paid out is taxable (you get tax releief going in) and affects the age allowance.There is no tax on gains within an ISA or on income or capital coming out.

    3) is this the best way to go about investing this sort of money for what I want?[/quote]

    Most people would use a stocks and shares ISA to accumulate an addition income in retirment.But this involves risk based investments,as do most pensions.

    Is this what you want?
    Trying to keep it simple...;)
  • wayoflife
    wayoflife Posts: 281 Forumite
    I am looking for 2 options to invest in...

    one is for a main pension for my partner

    another is to act as a top up pension (roughly 20% of full pension each) as a little extra income

    After reading your advice I think the best thing for a main pension is a SIPP. Am I right in saying that Hargreaves is the only SIPP without an annual fee and therefore the best SIPP provider?

    However the rough estimate is that your investments will return roughly 7% growth. Is it worth it when theres this much risk for only 1%? I.e. why not put it in an ISA and get 6% with no risk?
    INCREASE INTEREST ON SAVINGS!

    ...I will thank you if youve been helpful, please do the same! :j
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