We all need to be financially savvy. Whether you’re just starting out with your career or you’re starting to build up a healthy nest egg, it’s important to protect your money when planning for the future.
There are numerous options on the market, all with pros and cons. So which do you choose? It all boils down to your individual financial situation. Can you afford to lock money away for a period of time? Do you need instant access to your savings? How much are you looking to put away? What do you want to use it for in the future? These are all questions you should be thinking about when deciding what is the ideal vehicle for your savings.
First step, take a look at this quick guide on the perfect way to plan for your financial future from Aldermore Bank.
This is the most common form of savings. It enables you to put your money away in a savings account which you can access quickly and easily at any time. Not only can you dip into your savings as and when you need them, you can also put money away at any point.
Choosing Aldermore instant access savings accounts you can open an account with as little as £1,000 and will have unlimited withdrawals and can add to your savings at any point. It’s the perfect flexible solution for those who are starting to build up their savings. Dip in when you need it, and add again when you’re being frugal.
Fixed Rate Savings Account
If you’re starting to make some more considerable savings and have enough income to lock your money away for a year or two, you can really plan for your financial future with a fixed rate savings account.
This will guarantee a fixed rate of interest for a specific term giving you a layer of protection for your savings, whatever happens in the market. With the uncertainty surrounding the UK economy, this can prove to be a vital layer of protection.
Choosing this option will of course depend on your current financial circumstances, but if you can afford to do it, it could be vital for your financial future.
For many financial experts, an ISA is the cornerstone of your savings future. The reason behind this is with the real benefit of ISAs lying with the fact they are essentially tax free.
An ISA isn’t an investment in itself, it’s best viewed as a protective wrapper for your savings. Whilst they remain inside the ISA they are free from tax, giving you more scope to earn interest. There are two different ISAs on the market – Cash and Investment (also termed stocks and shares), however, within these categories there are various differences.
For example you can have cash ISAs in the form of fixed rate ISAs, giving you a fixed rate on your savings and the protection you need from both the tax man and fluctuations in the market.
For the current financial year you can invest £5640 in a cash ISA and is something everyone with any savings should investigate.
There are many options out there; it all depends on you.