Where to put redundancy money

sweetmoneysaver

Hi,

I will keep you posted. My appointment with the IFA is on 19th October so I'll post after that.

I totally agree about things working out if your husband gets another job quickly. It can be a great chance to turn financial matters around ... depending on the package of course! If I can match my salary or not to far off it, I can clear my debts and start again. Try to think positively, I know it can be hard, but a change like this can also be a great opportunity.

Good luck with everything. Let me know how things go.

Jo.

sweetmoneysaver

Hi Amanda65,

Well saw the IFA for a first run through of things and this was his advice:

1. Set up a cash ISA - £3,000
2. Set up an Equity ISA - £4,000 (for the longer term investment)
3. Repeat step 1. for the other partner/spouse
4. Transfer money into children's accounts, but don't invest anything greater than an amount that will yield £100/year in interest. This will depend on the interest rate on the account
5. Put money in a higher rate savings account for ready cash
6. Transfer money into lower tax rate payer's account to maximise interest
7. Use Premium bond and National Savings accounts but obviously these will yield relative low returns or possibly nothing in the case of PBs.
8. Use some of redundancy payment to pay into pension. This is partucularly useful if you have another job lined up and won't miss some of the money. This needs to be done at the time of redundancy and will be tax free but is probably more useful for sums over £30K will would then be taxed at your highest rate of tax.
9. make sure an R85 form is filled in for the kids accounts and your husband if he is not earning.
10. Don't forget to do ISA's pre April and then on April 6th to span across 2 tax years.

Hopefully a combination of these might work for you.

Did you contact anybody about the amount of savings you can have before losing benefits? I haven't checked this out but somebody at work said it was £8K. If this is the case and you have £13K, then some creative accounting in your name rather than your husband's may help.

I wish your family luck and hope your husband finds a job soon. Let me know how you get on.

Jo.

lipidicman

I hope that advice didn't cost too much, Martin has taught a lot of people those things for free. I also hope that the IFA gave you some more specific advice for your particular circumstances, those sound a bit general!

sweetmoneysaver

It was free through my company and yes I was rather disappointed! However, I have share schemes (3 different scheme types) which he has given me advice on as there are some complicated tax and CGT issues as some may come out of plans early when being made redundant. I think Amanda65 wanted some ideas for putting the £13K somewhere whilst her husband found a new job. I am still unclear though as to what the criteria are for being able to claim benefits after losing your job apart from getting NI contributions paid.

dunstonh

Sometimes simple is best. ISAs have made a lot of other products redundant or at least pushed them down the pecking order.

Amanda65

Thanks Jo - that's all very helpful. So far no news on teh job front so we will keep plugging away and who knows. my first lot of premium bonds could yield me a million in November (ha ha!!!). Good luck with what you have ahead as well. x