The new tax year is here

6 April – it’s the start of the new tax year today. With all your new annual tax allowances now available, this is traditionally a time when people take stock of their finances and make plans for the future.

This year, of course, is like no other, and many of us clearly have other priorities and concerns. But if this period of isolation is giving you the time and space to organise yourself and make plans, here is an update on your allowances and some suggestions from the Bestinvest team on how to get ahead.

 

Your 2020/21 allowances

This tax year:

• Your ISA allowance is £20,000
• The allowance for Junior ISAs has risen from £4,368 to a very generous £9,000
• You can invest up to £40,000 into a pension

 

The benefits of investing early

The sooner you make the most of your allowances, the sooner you reap the benefits. Investing early in the tax year will give your money more time to grow tax-free, which could result in higher returns.

Open an ISA                       Open a SIPP

 

Regular investing to cope with volatile markets

Drip feeding money into investments rather than paying it all in in one go can smooth out the highs and lows of the markets. If markets are down one month, you’ll get more for your money and vice versa. Investing regularly is also a great habit to get into – and a really easy one to achieve because all you need to do is set up a Direct Debit.

If you’re new to Bestinvest, you’ll need to open an account first and then set up monthly savings.

Open an ISA                      Open a SIPP

 

Give your investments an overhaul

Why not take this opportunity to give your investments an overhaul?

• If you need to brush up on your investing skills, we’ve got a fun series of Investing 101 lessons and videos for you

   

• If you’re looking for investment inspiration, try Our Top-rated Funds guide

• If you don’t want to choose your own investments, why not try a Ready-made Portfolio?

• And if you think your investments could do with a new lease of life, have you considered transferring them?

 

Don’t forget the kids

This tax year the Junior ISA allowance has risen to a whopping £9,000 from £4,368 so if you have the cash to spare, these kids accounts have just got a whole lot more attractive. And for the really forward thinking among you, you can actually open a pension for a child, invest up to £2,880 a year and the Government will contribute another 20% tax relief making this up to £3,600.

 

It’s good to talk

While everyone at Bestinvest is safely at home at the moment, you’ll be pleased to know that our friendly telephone team have taken their phones home with them and are eager to talk to you. Just give them a call on 020 7189 2400 with any questions you have.