17th September 2018 at 2:13pm
By Elle Tucker
Who doesn’t love this time of year? The slight crispness in the air, the hint of orange and red amongst the leaves, the urge to buy new stationery…
However old or young you are, that ‘back to school’ feeling can make you want to get super organised.
You don’t have to be saving for school or university fees to benefit from giving your finances a once-over to make sure you’re taking the right steps to give yourself the future you want.
So, sharpen your pencil – it’s time your finances had an examination.
‘Autumn’ clean your bank account
Step one of your review – go through your bank statements with a highlighter pen and get on top of your income and outgoings. Better still, manage them online.
Check for any free subscription trials that have ended which you’re now being charged for and insurance policies for items you no longer have, or that have renewed without you being notified.
Pay extra attention to those direct debits. Cancel anything you don’t need and redirect some of the money to your savings instead.
A few small changes now can help build a stronger savings buffer and could make a big difference to your future.
Let technology upgrade your money management
If you want to really get a handle on your money, new apps can give you an overview of everything you earn, owe or spend in a single place.
Technology like this is revolutionising how many of us manage our money, allowing you to see multiple accounts from different places.
The same is true about your pension and other savings, with apps letting you manage or top-up your savings.
Read more about apps that can help your budgeting.
The season to save
Pension Awareness Day lands during September, so why not take the opportunity to get on top of your pension.
If reviewing your finances frees up some spare pounds and pence, consider saving a bit more into your pension.
The tax relief on your pension contributions makes pensions a great way to save for your future, whatever the time of year.
Find any mislaid pensions
Recent research* has revealed that the number of people who’ve lost track of a pension has increased – and it could mean more than 7 million people have misplaced some of their retirement savings.
If you’ve lost a pension, don’t worry – it isn’t that unusual. Read our article ‘Tracking down a lost pension’ to find out the easiest way to go about finding yours.
Your first port of call should be your pension provider, or you can contact the Government’s Pension Tracing Service.
Bring your pensions together
If you’ve accumulated a few pensions, it might make sense to combine them into one.
Having all your pension savings in one place means one set of paperwork and one provider.
This could make it easier to check how much you’ve saved – and how your pension investments are performing, bearing in mind that the value of your fund can go down as well as up and you may get back less than you paid in.
And having one pension can make it easier to save into. Top it up when you want (maybe you got a bonus at work and want to save it as tax-efficiently as possible into your pension) and if you go online or use an app, it’s quick and simple.
Combining your pensions isn’t right for everyone. Before you consider this you need to be sure that you aren’t giving up any valuable guarantees that your pensions give you. Get to know what you’ve got first before making any decisions.
While you are thinking about your pension it is worth considering and reviewing where your money is invested as this could make a big difference to the lifestyle you can afford when you stop working. You can read more about choosing and reviewing your pension investments here.
Make the most of your tax-friendly savings
The end of the summer is also a good opportunity to think about your ISA savings, if you have some.
An ISA can be a useful way for saving for things like holidays, a wedding, or education fees – things that you are more likely to need in the short or medium term.
Your ISA allowance now sits at a generous £20,000 each year, so, if you’re thinking about an ISA – or topping up an existing one, don’t leave it until the end of the tax year to make the most of it.
Instead, why not make the most of any tax-efficient growth now, and then start saving again in the new tax year next April – when you’ll be able to save up to £20,000 again?
There’s a lot to consider when it comes to choosing where to put your savings. Make sure you take your time to think about what’s right for you.
Tax return: Start early to make tax less taxing
On the subject of tax, if you do self-assessment, have you thought of doing your tax return early this year? Autumn could be the ideal time.
The deadline for paper tax returns is the end of October, but you have until 31 January to submit yours online for the 2017-18 tax year.
You can actually submit your tax return from 6 April at the start of the new tax year. Yet, many people leave it to the last minute – and end up doing theirs on Christmas Day, or even right at the end of January deadline.
Sorting it out early will be a weight off your mind. You’ll know how much you’re likely to be due to the taxman, and make the most of any important allowances and tax reliefs you are entitled to.
Part of this is down to using your tax return to claim back any higher or additional tax relief you are entitled to on contributions you’ve paid into your pension. Read more on maximising pension tax breaks here. You may even be due a tax rebate!
What have we learned at savings school?
That with your finances in better shape, you could get the opportunity to make the most of your money, and top your savings up.
Whatever stage you’re at, if you can learn the lessons and graduate from savings school with top marks you’ll certainly have a lot to look forward to.
Elle Tucker is a freelance journalist
The views expressed in this article should not be regarded as financial advice and information is correct as of September 2018. It’s important to remember that a pension is a long-term investment and its value can go down as well as up. It could be worth less than was paid in. Remember that the value of all investments can go down as well as up and may be worth less than you paid in. Laws and tax rules may change in the future. *https://www.ftadviser.com/pensions/2018/05/30/millions-may-have-lost-their-pension/