There are certain tips that you can follow to help with managing your personal finances before the end of the tax year. Most people don’t even consider half of these things, and they are missing out. With all of the different ways to boost your finances, it is crucial that you spend some time getting this information before doing anything.
1. Take Advantage of your ISA Allowance
It is always a good idea to use the money in your ISA so that you don’t end up losing it. While you may think that you don’t have any real reason to use your allowance right now, it’s still a good idea to put it in the bank or invest it. Once you do one of these two things with your allowance, it cannot be taxed. You should never ignore the end-of-the-tax-year deadline, because you’ll just be losing money that you could otherwise benefit from.
2. Come up with a Plan for Investing
If you are interested in investing your money, you first need to come up with a solid plan for doing so. Before you take advantage of a stocks and shared ISA, you need to take a look at some of the investment opportunities that exist. It’s never a good idea to rush into this kind of decision, because you will almost certainly regret it. Investing is rarely a sure thing, so you need to do everything you can to minimize your risk.
3. Give it Away
You may also want to consider giving away some of your money to someone you know as a gift. You will be able to give away £3,000 in gifts each tax year without having it be counted as part of your estate. This is important to do if you want to give someone money or a gift without paying taxes on it later on. It is particularly crucial for those with larger estates to consider this. In case you didn’t know, you can give money to your spouse or civil partner tax-free, assuming they live somewhere in the UK. It is a good idea for everyone to know these things.
4. Decide on the right ISA
It’s never too early to start thinking about what sort of ISA you are going to take advantage of next year. There are cash ISAs, stocks and shares, and lifetime ISAs. It is important that you review your options until you find one that can benefit you the most. The more you plan ahead, the better your chances will be of benefiting financially. If you want to buy your first house, you should really look into getting a Help to Buy ISA.
5. Have a Will Made up
It is important for almost everyone to have a will, especially those who have a family of their own. You shouldn’t have to spend very much to get this document written up, and it will give you peace of mind. You can trust that your partner and children will get everything that is coming to them in the event of your death. Those who do not have a will can plunge their family into a very unpleasant situation. In fact, your loved ones might not get everything you want them to if you don’t have a will made before you pass on. You can have this done fairly quickly, and it is well worth the expense. The larger your estate, the more sense it makes to have a will. Even many younger people should have a will in place.
6. Keep up with Relevant Changes
The government always seems to be changing the laws when it comes to matters of personal finance, so you need to keep on top of them as best you can. Some of these changes could affect you in a big way, which is all the more reason to stay in the know. The personal allowance for income tax changes from time to time, and it affects millions of people across the UK. When you make an effort to stay up to date in these matters, you can protect yourself and your finances.
It is also to put as much into your pension as possible before the end of the tax year. There is no question that pension contributions are the most practical and efficient way to invest your money. Start taking the necessary steps to make your pension pot as large as possible so you can get to where you want to be on time. You can pay into your pension by as much as £40,000 per year, which includes contributions made by your employer. The sooner you start taking these important steps, the better off you will be in the future.