NFU Mutual advising people to max out Pension & ISA contributions before the budget

hallmark

https://finance.yahoo.com/news/savers-urged-maximise-tax-allowances-050000661.html

Interested on what are other's views on this.

I'm expecting the budget to be grim, however I think there's almost zero chance that either ISA or Pension contribution allowances/rules for 2024-2025 will change.   How can it possibly, when many people will already have maxed out both? (not to mention the chaos it would cause employers).

Yes CGT can change with immediate effect, but ISAs and Pensions, zero chance IMO.

But what do other's think?

ColdIron

From the many threads on these boards and elsewhere, increased enquiries to financial advisors along with mild to wild speculation from financial publications it's clear that there is a lot of fear about

Who knows how many decisions people have made that they will come to regret

It strikes me as irresponsible to have stoked it up and allow it to run unconstrained. I can see no advantage to be gained by the current state of affairs. People naturally like certainty and we have nearly seven more weeks of this to go

InvesterJones

I presume people will already have been maxing these out as soon as possible anyway - little point holding onto money outside of tax shelters when you could put it within.

molerat

People with a vested interest in you putting more money into your pension tell you to urgently put more money into your pension.

Hoenir

What the general population think will have zero bearing on the budget. 

Sarahspangles

I doubt these advisors are willing to put anything in writing beyond the NFU’S advice:

Sean McCann, a financial adviser at NFU Mutual, said: “We are advising people to take advantage of the tax allowances that are there at the moment.
“If people are planning on maximising their pensions they should do it before the Budget. We are advising people that allowances are pretty healthy at the moment so if you are planning to use them do it before now.”

Which amounts to “Do what you were already planning to do”. Although if you read his last sentence, time travel will be involved.

It’s clear that people are not going to feel better off after the budget, and the Government has been open about this. So you can see why ‘advisors’ are keen to sell products now.

TheBanker

Sarahspangles said:

I doubt these advisors are willing to put anything in writing beyond the NFU’S advice:

Sean McCann, a financial adviser at NFU Mutual, said: “We are advising people to take advantage of the tax allowances that are there at the moment.
“If people are planning on maximising their pensions they should do it before the Budget. We are advising people that allowances are pretty healthy at the moment so if you are planning to use them do it before now.”

Which amounts to “Do what you were already planning to do”. Although if you read his last sentence, time travel will be involved.

It’s clear that people are not going to feel better off after the budget, and the Government has been open about this. So you can see why ‘advisors’ are keen to sell products now.

Well they do say the best time to start investing is twenty years ago, but the second best time is now...

Aretnap

Very much a case of Mandy Rice-Davis Applies ("They would say that, wouldn't they?")

I mean, a company that makes it's money (partly) from people putting their money into ISAs and pensions is hardly likely to say "no, don't bother putting your money into ISAs and pensions", are they?

It's been absolutely reliable for as long as I can remember that financial services companies put out press releases before every budget warning the public to make use of their pension and ISA allowances while they still can, and for these to be dutifully copied out by the press. It's really just a form of free advertising.

Aretnap

Also, there has been a lot of (equally wild) speculation about cuts to the amount of tax free money that you can withdraw from pensions. Have NFU Mutual put out a press statement suggesting that customers should withdraw their 25% tax free cash while they still can? Thought not. 

Why would a company that manages pensions suggest that people should pay money into pensions in a panic, but not that they should withdraw it from pensions in a panic? I've thought about this question for a while, but can't really figure it out. It's one of life's mysteries I suppose.

zagfles

hallmark said:

https://finance.yahoo.com/news/savers-urged-maximise-tax-allowances-050000661.html

Interested on what are other's views on this.

I'm expecting the budget to be grim, however I think there's almost zero chance that either ISA or Pension contribution allowances/rules for 2024-2025 will change.   How can it possibly, when many people will already have maxed out both? (not to mention the chaos it would cause employers).

Yes CGT can change with immediate effect, but ISAs and Pensions, zero chance IMO.

But what do other's think?

Why do you think that? Look at what has actually happened in the past.

In the April 2009 budget the last Labour govt intended to restrict tax relief for high earners to basic rate, but they knew that they couldn't realistically implement it before April 2011. And they knew that would give a window where high earners could stuff their pensions. So they introduced anti-forestalling legislation, applying from the date of the budget, to stop them.
See 
Microsoft Word - Pension Anti-Forestalling Rules 2010 (rosan-ifa.com)
Budget 2009 Building Britain's Future HC 407 (publishing.service.gov.uk)  5.90 onwards

In the end the actual main change never happened because of the change of govt. But the anti-forestalling legislation did happen. 

This govt could simply cut and paste the 2009 budget, maybe changing the limit as to what constitutes a high earner. 

ISAs would be just as easy. If they wanted to reduce the ISA allowance, they could do similar. 

Grumpy_chap

zagfles said:

changing the limit as to what constitutes a high earner. 

Well, that article you linked indicated that "high earner" was £150k and reduced to £130k.  I suspect by now, "high earner" will be £50k or less.