By: Nicholas Hunt
Take a look around at the best buy savings tables in recent times and you'll see that the savings rates offered to people with money to invest are pitifully low. This is of course because of the current economic climate and low base rates.
The amount of interest you can earn on your savings these days is barely enough to keep up with inflation, and in some cases you're effectively paying your bank to store your money in your account for you, as the value of your deposit falls in real terms. This situation is even worse when you consider that tax needs to be paid on the already meagre amount you're earning off your investment - which for many in the UK who have sufficient funds to invest is a full 40% of the return.
With this in mind, does a long term investment earning good returns completely free of tax sound attractive? UK investors have precisely this option in the form of the Individual Savings Account, or ISA as it's more commonly referred to.
Under this government backed scheme, savers can deposit up to £7,200 a year into an account from a variety of providers, and pay no income tax or capital gains tax on the returns.
Up to £3,600 of deposits a year can be in the form of cash deposits which earn interest in much the same way as a normal savings account, while the next £3,600 up to your annual limit must be invested in stocks and shares (managed by your account provider).
Alternatively, the full amount of your yearly deposit allowance can be invested in stocks and shares. Which combination of cash or stocks and shares you choose depends largely on your attitude to risk - stocks and shares will generally perform better over the medium to long term, but as we're seeing at the moment markets can go down as well as up, and so therefore can your investment. The advice of an independent financial professional is always a good idea if you're unsure which of the options is best for you.
Although the amounts involved might not seem to be very significant considering the annual investment limit, over a period of years your investment can grow into a considerable sum if your full allowance is used - and it will be quietly sitting there earning a tax-free return on the cumulative amount deposited along with compounding the interest paid back into the account. It is therefore a great way to save long term, for retirement for example - and who doesn't like the phrase 'tax-free'?
Article Source: ABC Article Directory
Nicholas writes for Your Banking Guide where you read more about tax-free ISA options, as well as compare high interest savings accounts.
Tuesday, March 3, 2009
Making The Most Of Your Cash
By: Alisdair Cosgrove
With the financial climate in the state that it is in we could all do with some help when it comes to saving a little money on our outgoings each month and making our money stretch that little bit further. The rising cost of things such as food, petrol, and energy, coupled with the effects of the global credit crunch, have all taken their toll on most households' finances, and for many people the time has come to take action and try and streamline what goes out of their accounts each month.
There is one effective way in which you could reduce the amount of money that you pay out on your debts each month, and this is through consolidation. With a low rate consolidation loan you can pay off all of your smaller, high interest debts such as credit and store cards, and you can then enjoy having to make just one debt repayment each month rather than several. More importantly you could find that consolidation could help you to save a considerable amount of money on the amount that you have to pay out on your debts every month.
Another way in which you could cut back on how much you pay out each month is by looking at switching some of your services such as your utility or broadband providers. The prices charges by different providers can vary considerably and you could find that you will pay far less with one provider than you are paying with your existing provider. You can check out deals and prices with ease using one of the various price comparison sites in operation today.
We all know that the interest rates on some credit cards can be very high, and if you are making monthly repayments on one or more high interest credit cards you could find that much of your income is going on paying the interest alone. Consider transferring your existing credit card balances onto a 0% balance transfer credit card, as you can then enjoy a period of interest free credit, which can save you a fortune in interest and could help you to clear the credit card debt more quickly.
Many people find that every month they clock up huge fees and charges due to missed or late repayments on credit cards or for exceeding credit limits on overdrafts and cards. Try being more careful about your money and monitor carefully what comes in and goes out of your account so that you never exceed the limit. Also, make sure that all repayments are made on time. A little more care over your accounts could save you a lot of money in charges and could even help you to avoid damage to your credit.
Over recent months many people have stopped shopping at the big name supermarket giants and have switched to the smaller discount supermarkets. Recent research has shown that this can cut your shopping bill by over 20% in some cases, so try out one of the discount supermarkets for your groceries and households goods and see whether this can help you to save money. If you still want to shop at the larger supermarkets keep your eyes open for special offers and promotions that many of the larger supermarkets are now running.
Article Source: ABC Article Directory
Alisdair Cosgrove has been writing personal finance articles for many years and can find more of his work at the UK site TheMoneyStop.co.uk, offering bank accounts along with great best savings accounts along with great bank account and tips on high interest savings accounts.
With the financial climate in the state that it is in we could all do with some help when it comes to saving a little money on our outgoings each month and making our money stretch that little bit further. The rising cost of things such as food, petrol, and energy, coupled with the effects of the global credit crunch, have all taken their toll on most households' finances, and for many people the time has come to take action and try and streamline what goes out of their accounts each month.
There is one effective way in which you could reduce the amount of money that you pay out on your debts each month, and this is through consolidation. With a low rate consolidation loan you can pay off all of your smaller, high interest debts such as credit and store cards, and you can then enjoy having to make just one debt repayment each month rather than several. More importantly you could find that consolidation could help you to save a considerable amount of money on the amount that you have to pay out on your debts every month.
Another way in which you could cut back on how much you pay out each month is by looking at switching some of your services such as your utility or broadband providers. The prices charges by different providers can vary considerably and you could find that you will pay far less with one provider than you are paying with your existing provider. You can check out deals and prices with ease using one of the various price comparison sites in operation today.
We all know that the interest rates on some credit cards can be very high, and if you are making monthly repayments on one or more high interest credit cards you could find that much of your income is going on paying the interest alone. Consider transferring your existing credit card balances onto a 0% balance transfer credit card, as you can then enjoy a period of interest free credit, which can save you a fortune in interest and could help you to clear the credit card debt more quickly.
Many people find that every month they clock up huge fees and charges due to missed or late repayments on credit cards or for exceeding credit limits on overdrafts and cards. Try being more careful about your money and monitor carefully what comes in and goes out of your account so that you never exceed the limit. Also, make sure that all repayments are made on time. A little more care over your accounts could save you a lot of money in charges and could even help you to avoid damage to your credit.
Over recent months many people have stopped shopping at the big name supermarket giants and have switched to the smaller discount supermarkets. Recent research has shown that this can cut your shopping bill by over 20% in some cases, so try out one of the discount supermarkets for your groceries and households goods and see whether this can help you to save money. If you still want to shop at the larger supermarkets keep your eyes open for special offers and promotions that many of the larger supermarkets are now running.
Article Source: ABC Article Directory
Alisdair Cosgrove has been writing personal finance articles for many years and can find more of his work at the UK site TheMoneyStop.co.uk, offering bank accounts along with great best savings accounts along with great bank account and tips on high interest savings accounts.
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