Savings & Investments
Making your savings go further
Investing can be complex and its never too early to start planning your future.
At Newstead Clark, our expert independent financial advisers will work with you directly to construct an investment strategy that fits your goals and objectives. Whether you are looking to generate an income, invest for growth, reduce your income tax bill, or even avoid long term care costs, we can help.
Take the first step now and book a free initial consultation with one of our advisers.
Below are a list of potential investments and how they may be right for you.
Investment Saving Account(ISA)
Individual Savings Accounts (ISA) are a tax-free saving vehicle. Most people are aware of cash ISA’s, which operate like a traditional savings account however, stocks and shares ISA’s invest in the stock market and can potentially give better returns than a cash ISA, but with a higher risk. You can invest upto £20,000 per tax year into an ISA and have proven to play a key part in many peoples financial and retirement plans.
Why invest into an ISA?
- The amount of gain your investment achieves is unlimited and free of capital gains tax.
- You can invest upto £20,000 per tax year and this can be through regular or lump sum contributions.
- You can withdraw funds from ISAs without incurring a tax liability. Keep in mind our experts would advise against making early withdrawals.
- You can pass your ISA savings onto your spouse if you were to pass away, through an ‘inherited Isa allowance’. This is a one-off payment that is equal in value to the amount that was saved in the account, in addition to the allowance.
ISAs are highly portable. It is possible to switch from one provider to another to take advantage of superior interest rates and deals. You could also transfer your funds from a cash-based ISA to a stocks and shares account, and vice versa.
Open-Ended Investment Company (OEIC)
Open Ended Investment Companies are professionally managed collective investment funds. Managers pool money from many investors and buy shares, bonds, property or cash assets and other investments.
Are there advantages to investing in an OEIC?
- Diversification - OEICs can offer greater potential for growth and can help to reduce your investment risk as your money is spread across a range of assets.
- Expert management - Your investment is managed by a professional fund manager, supported by expert research and market analysts to help you achieve your goals.
Economies of scale – When you invest in an OEIC your money is pooled with that of other investors, enabling fund managers to achieve economies of scale when they buy and sell holdings on your behalf.
Investment Bonds
An investment bond is a life insurance policy where you invest a lump sum in a variety of available assets. With an investment bond, a lump sum is paid out at death, end of term or surrender. When the bond is cashed in, how much you get back depends on the success of the investment and any withdrawals made.
So, what are the advantages of an investment bond?
- Inheritance Tax mitigation if gifted into trust
- Tax deferment especially offshore bonds
- Income planning
Venture Capital Trusts (VCTs)
Venture Capital Trust (VCT) are listed companies that invest in other, smaller companies. The tax benefits include Income Tax relief and Capital Gains Tax exemption. Whilst the potential return is higher, there is also an increased risk associated with investing in smaller, unlisted companies.
Why invest in a VCT?
- VCTs offer growth potential as you are investing in smaller, VCT-qualifying companies.
- You can claim up to 30% upfront income tax relief on the amount you invest (upto £200,000), provided you keep your VCT shares for at least five years.
- Tax-free capital gains – If you decide to sell your VCT shares and you make a profit, the proceeds won’t be liable for capital gains tax.
- Tax-free dividends – If your VCT pays dividends, there is no tax to pay, and you won’t need to declare them on your tax return.
Risk Warning:
When investing your capital is at risk.
The value of your investment can go down as well as up and you may not get back the full amount invested.
Investments do not include the same security of capital which is afforded with a deposit account.
VCT’s are high-risk products and are not suitable for everyone. To understand the features and risks please
speak to a qualified investment adviser.
If you would like to know more book a free initial meeting with one of our experts today.
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