Savings or pension

Lancasterman

i have some spare cash over and above my savings limit ,with interest rates so low, should I put it in an isa or into a pension for best returns. I am 56 yrs old . Any advice .

grumiofoundation

What do you mean by “ISA”?

Assuming you are talking about a stocks and shares ISA vs Pension (the tax wrappers). 

The returns you get are determined by the investment you choose not the wrapper. 

Pension will give you a head start de to tax relief (amount of a head start will depend on what tax you pay now and will pay in retirement) but you sacrifice accessibility. 

Edit: realised “The tax wrappers” sound like the worst band in history....

eskbanker

Lancasterman said:

i have some spare cash over and above my savings limit

What do you mean by this too?  If you mean that you're earning more than a grand in interest and, together with other income,  are therefore liable to pay some income tax, that's not necessarily a reason in itself to look beyond cash savings, but it is likely that other options may help.  Pensions or other investments may be part of that, or even just premium bonds, but so much depends on your whole financial circumstances rather than the small fragment you've chosen to share thus far....

grumiofoundation said:
realised “The tax wrappers” sound like the worst band in history....

Even worse than HMRC Hammer's legendary "U Can't Tax This"?

grumiofoundation

 Even worse than HMRC Hammer's legendary "U Can't Tax This"?

Well personally I prefer Vanilla ISA...

Lancasterman

By “over and above my savings limit” I mean as much as I need to keep in a 0.01 % interest savings account for emergencies.

dunstonh

So, what are you objectives with this money?   Is it short term money, medium term, long term?  growth or income providing or what?

Thrugelmir

Lancasterman said:

By “over and above my savings limit” I mean as much as I need to keep in a 0.01 % interest savings account for emergencies.

Here's one account you can immediately better that with.

https://www.marcus.co.uk/uk/en/savings/online-savings-account

Albermarle

Thrugelmir said:

Lancasterman said:

By “over and above my savings limit” I mean as much as I need to keep in a 0.01 % interest savings account for emergencies.

Here's one account you can immediately better that with.

https://www.marcus.co.uk/uk/en/savings/online-savings-account

Or Premium Bonds 

Albermarle

Lancasterman said:

i have some spare cash over and above my savings limit ,with interest rates so low, should I put it in an isa or into a pension for best returns. I am 56 yrs old . Any advice .

Do you have any knowledge of investing ? If not then you need to start learning at least the basics before committing any money to either a pension or a S&S ISA.

Eco_Miser

Why don't you keep it in a 0.5% account?

https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/#easyaccesstable

colsten

Just a few more questions....
How old are you?
Are you a BR or HR tax payer?
If you are in a works pension scheme, can you make additional payments, and would those be matched by your employer (partially or fully)?
Does your partner have a pension?
How would you/your family cope if your income ceased?
What is your attitude to risk? How much of your savings would you be prepared to lose?

If you are not happy to share your answers to these questions on an Internet Forum, please do at least consider them when making your decision