Budget 2014 – Good For DIY-Investors?
The Budget 2014 – Supporting DIY-Investors?
Today, George Osborne delivered his 5th Budget as Chancellor. My ears perked up when I heard him announce (live) that he was changing the pension system and it seems at first glance that this 2014 budget will be good for us DIY-Investors.
Another aspect which I believe will be welcomed by DIY-Investors are changes to the ISA system, allowing more to saved in these tax-free wrappers.
A summary of the pension details is set out, in the H.M. Treasury synopsis, in the box below…
[features_box_light_blue width=”75%” + border=”1px”]
In the meantime, as a first step towards this reform, the Chancellor has announced a number of changes to the current rules that will come into effect from 27 March 2014. This will allow people to have greater freedom and choice now over accessing their defined contribution pension savings at retirement. These are:
- reducing the amount of guaranteed income people need in retirement to access their savings flexibly, from £20,000 to 12,000
- increasing the amount of total pension savings that can be taken as a lump sum, from £18,000 to £30,000
- increasing the capped drawdown withdrawal limit from 120% to 150% of an equivalent annuity
- increasing the maximum size of a small pension pot which can be taken as a lump sum (regardless of total pension wealth) from £2,000 to £10,000 and increasing the number of personal pots that can be taken under these rules from two to three
[/features_box_light_blue]
If you would like to look at the Treasury Press Release (factsheet), on the Pension changes, you will find it here:
Greater Choice In Pensions Explained
However, if you would like to look at the whole budget, you will find the 2014 Budget (pdf) Here.
ISA’s Become NISA
A nicer ISA, called a NISA, sounds like a headline makers dream but this is another very positive move for us DIY-Investors. The summary of details, from the HM Treasury, is set out below:
[features_box_light_blue width=”75%” + border=”1px”]
NISAs
From 1 July 2014 ISAs will be reformed into a simpler product, the ‘New ISA’ (NISA), with an overall limit of £15,000 per year. The government is also abolishing the rule that says only half can be saved in cash.
This will give savers complete flexibility to save or invest how they wish, and will benefit over 6 million people previously constrained by the cash and or stocks and shares limits.
The government will also raise the limits for Junior ISAs and Child Trust Funds from £3,720 to £4,000.
[/features_box_light_blue]
This Friday (21st March at 8pm), we’ll be holding a Free Webinar entitled “The 2014 Budget – Good For DIY-Investors?”, to attend, Register Here.
Do you think the 2014 Budget looks promising for us DIY-Investors? Register for the webinar and let us know what you think!
Mick Pavey (19th March 2014)